Baylin Acquires Advantech Wireless Inc.'s Radio Frequency and Microwave Divisions - Seite 2

Expected benefits of the Acquisition for Baylin include:

• Based on consensus research estimates, the Acquisition would:
  • be significantly accretive to EPS even before synergies; and
  • result in pro-forma LTM EBITDA of approximately $10 million⁽¹⁾;
• Complementary products strengthen Baylin's offering in wireless infrastructure, allowing it to offer "turnkey" solutions to its customers;
• Gives Baylin access to new untapped verticals;
• Greater sales reach through an expanded geographical footprint in North America, South America and Europe;
• Potential cost synergies through optimization of supply chain, implementation of lean manufacturing, improved procurement practices, and rationalization of corporate overhead; and
• Baylin would acquire title to the "Advantech" business name, intellectual property, customer contracts and other licenses, rights and contracts.

(1)	Pro-forma figures represent the combination of Baylin and Advantech's LTM figures as of September 30, 2017. Revenue and cost synergies are not included. Figures are unaudited.

The principals of Advantech have entered into a consulting agreement with Baylin, pursuant to which they will provide their services to Baylin for a period of two years.

Details on Debt Financing

In connection with the Acquisition, Baylin has entered into a credit agreement with Crown Capital Partners Inc. ("Crown"), pursuant to which Crown will provide a $33 million term loan, with a rate of 9.0% per annum and maturing in 60 months. In addition, a total of 682,500 warrants of Baylin were issued to Crown.

Post the Acquisition, Baylin will have over $10 million in cash and a net debt/pro-forma LTM EBITDA⁽¹⁾ ratio of approximately 2.4x.

Advisors

Raymond James acted as exclusive financial advisor and Aird & Berlis LLP acted as legal counsel to Baylin on the Acquisition. Raymond James also acted as exclusive advisor to Baylin on the debt capital raise.

Conference Call Information

Baylin will host a conference call on January 17^th, 2018, at 9:45 a.m. (ET) to discuss the Acquisition. The call will be hosted by Randy Dewey, President and Chief Executive Officer, and Michael Wolfe, Chief Financial Officer. All interested parties are invited to participate.