TSX VENTURE SYMBOL: HOP
TORONTO, June 27 /CNW/ - On June 18th, Telehop Communications Inc.
("Telehop") (TSXV-HOP) announced that it was in receipt of a letter proposal
respecting the purchase of all the outstanding shares of the Corporation from
an arm's length strategic industry participant. The Board of Directors of
Telehop and its advisors have been engaged in discussion with the bidder and
are now in a position to report the following:
The aggregate offer price will be up to Cdn. $10,690,800 for 100% of the
equity interests of Telehop, subject to the terms of an Amalgamation Agreement
which must be completed within 45 days of signing. During this 45 day period,
the Bidder will operate on an exclusive basis. The offer currently expires on
July 4, 2008 and as with all offers, it may be withdrawn before acceptance by
the Bidder at anytime.
The Maximum Offer Price represents a price per share of CAD $0.80 based
on 13,363,500 Shares outstanding as of June 10, 2008. The offer imposes a
number of other conditions upon the Company typical in an offer of this type,
including but not limited to allowing the bidder to reduce the offer price on
a dollar for dollar basis should working capital at the closing of the
transaction be less than $3,000,000 and should budgeted restructuring costs
exceed $2,500,000. The offer is conditional upon completion of due diligence
to the satisfaction of the bidder, subject to approval of the bidders bankers,
subject to a minimum take up of 66 2/3% of shareholders, subject to the
necessary regulatory approvals, subject to shareholders' approval, subject to
a material adverse effect, subject to unanimous board recommendation, amongst
other things. The bid is no longer subject to a deposit from the Company, the
bid provides the board with a fiduciary out should a superior bid emerge and
also provides the bidder with the right to match any superior bid. A break fee
of $300,000 would be owed to the Bidder in certain circumstances.
The Board of Directors and its advisors will continue to negotiate with
the Bidder in the coming days and will announce when an agreement has been
reached or when the Board believes that good faith negotiations cannot achieve
consensus between the Company and the Bidder using its business judgement.
There is a significant risk to completing any transaction of this nature;
shareholders are advised to seek the appropriate investment advice relevant to
their circumstances and level of sophistication.
For further information:
For further information: Telehop Communications Inc., Gary Clifford,