Aviat U.S., Inc. entered into a non-binding letter of interest to acquire Redline Communications Group Inc. (TSX:RDL) from a group of shareholders for CAD 15.5 million on January 18, 2022. Aviat U.S., Inc. entered into an arrangement agreement to acquire Redline Communications Group Inc. from a group of shareholders on April 13, 2022. Under the agreement, Aviat will acquire all outstanding shares of Redline for CAD 0.90 per common share, in an all-cash transaction valued at approximately CAD 16.2 million, debt free basis. Aviat expects to fully fund the acquisition from cash on hand from the balance sheet. The Arrangement Agreement also provides for the payment of a termination fee of CAD 0.65 million to Aviat in the event the Transaction is terminated in certain specified circumstances, including if Aviat does not exercise its right to match in the context of a superior proposal supported by Redline. The Transaction has been unanimously approved by Aviat's Board of Directors. The full Board of the Directors of Redline unanimously approved the Transaction. The transaction is subject to customary closing conditions and necessary regulatory approvals. The Transaction will be carried out by way of a Court-approved plan of arrangement under the Canada Business Corporations Act. The implementation of the Arrangement will be subject to the approval of at least 66 2/3% of the votes cast by Redline shareholders. Redline's Board of Directors established a Special Committee of independent directors (D. Neil McDonnell and Josef Vejvoda) to oversee the Transaction discussions and the Arrangement. Redline Communications Group shareholders meeting will be held on June 21, 2022. All directors and executive officers of Redline and certain other shareholders of Redline, holding approximately 29.7% of the issued and outstanding Redline Shares as of the date hereof, have entered into voting and support agreements in favour of Aviat. As of June 21, 2022, the transaction was approved by Redline shareholders. As of June 29, 2022, Redline Communications obtained a final order from the Ontario Superior Court of Justice (Commercial List) approving the transaction.

The transaction is expected to close within four months. As of June 29, 2022, the transaction is expected to close in the first half of July 2022. It is expected this deal to be immediately accretive to Aviat's gross margin %, Adjusted EBITDA, non-GAAP EPS, and Free Cash Flow all in the first year. Evans & Evans, Inc., financial advisor to Redline, has provided a fairness opinion to the Board of Directors of Redline. Cat Youdan of Blake, Cassels & Graydon LLP acted as legal advisor to Aviat Networks, Inc. Richard Yoon, Iaint Mant of Fasken Martineau DuMoulin LLP acted as legal advisor to Redline. Computershare Investor Services acted as transfer agent to Redline.

Aviat U.S., Inc. completed the acquisition of Redline Communications Group Inc. (TSX:RDL) from a group of shareholders on July 5, 2022. The Redline common shares are expected to be delisted from the Toronto Stock Exchange on or about July 7, 2022 and Redline has made an application to cease to be a reporting issuer under applicable Canadian securities law. The common shares were delisted from the Toronto Stock Exchange at the close of business on July 6, 2022.