Section 192 Process Concludes
TORONTO and MONTREAL, May 14 /CNW/ - Look Communications Inc. today
announced that the Ontario Superior Court of Justice has approved the
agreement with Rogers Communications and Bell Canada (through their joint
venture, Inukshuk Wireless Partnership ("Inukshuk")), for the sale of its
spectrum and broadcast licence pursuant to the Sales Process Order approved by
the Court on January 21, 2009.
Under the agreement, Inukshuk will pay Look $80 million for Look's 92 MHz
of spectrum which is equivalent to coverage of approximately 1.8 billion
MHz/Pops. As part of the agreement, Look and Bell Canada have also resolved
all outstanding litigation.
The Agreement of Purchase and Sale (the "Agreement") allows Inukshuk to
acquire Look's spectrum (2596 to 2686 MHz and 2689 to 2690 MHz inclusive) for
$80 million cash. Payment is scheduled in three instalments and the purchased
spectrum will not be transferred unless and until full consideration is paid.
If for any reason the full $80 million is not paid, or not paid according to
the agreed upon schedule, any payments made to Look are non-refundable and the
spectrum would be retained by Look. The payment schedule is as follows:
1. A $30 million non-refundable payment due immediately;
2. A $20 million non-refundable payment to be made no later than
December 31, 2009; and
3. A $30 million final payment to be made no later than the earlier of
regulatory approval of the transaction or May 14, 2012.
Look understands that Inukshuk is interested in completing the Agreement
as soon as possible and as a result Look will commence the orderly wind down
of its present operations over the course of the next 90 days. Further details
of this action will be provided to Look's subscribers over the next few weeks.
A condition precedent to the Agreement was the resolution of all
litigation between Look and Bell Canada which, among other things, was
resolved in the following manner:
1. Bell and Look providing each other with mutual full and final
releases from any and all current litigation;
2. Look paying Bell $16 million as full and final settlement, to be paid
contemporaneously with the initial $30 million non-refundable payment
from Inukshuk as part of the Agreement. The amount includes
approximately $10 million in trade payables carried by Look plus an
additional $6 million payment;
3. As Look winds down its operations over the course of the next 90
days, Look will pay to Inukshuk all revenues collected from its DSL
Internet subscribers on Bell's network for services provided during
the wind down period net of all applicable taxes in lieu of the
current $360,000 currently paid to Bell on a monthly basis; and
4. All contracts between Bell and Look can be terminated without
A further condition precedent to the Agreement, required by Rogers, was
that Unique Broadband Systems (TSX Venture: UBS), Look's parent company (with
a 51.8 per cent economic interest in Look), was required to settle its
litigation with Microcell et al. (a Rogers' subsidiary). At the request of
Look, UBS agreed to settle the litigation. UBS will provide the required
irrevocable release, and will receive $4 million from Rogers, upon Inukshuk's
first payment of $30 million to Look. The defendants to UBS' action all deny
liability and the settlement is not an admission of any kind.
Now that the Final Approval Order has been received from the Court, and
the Section 192 process concluded, Look will continue to pursue opportunities
with interested parties to maximize the value of its remaining three assets,
1. Tax Attributes - Approximately $300 million in tax attributes;
2. Subscribers - Approximately 25,000 video and Internet subscribers;
3. Network - A network consisting of two network operating centers (in
Toronto and Montreal), 26 one-way broadcast sites and 10 two-way
Unique Broadband Systems (TSX Venture: UBS), Look's parent company (with
a 51.8 per cent economic interest in Look), has indicated that it will
consider all of its options to assist Look in realizing value for the
remaining assets. One option for UBS, among others, is the sale of its
interest in Look to facilitate the full value of Look's tax attributes.
About Look Communications Inc.
Look's mission has been to be an M3 - Mobile Multi Media -
communications, entertainment and information service provider in Ontario and
Québec. The Corporation currently delivers a full range of communications
services including high-speed and dial-up Internet access, digital television
distribution, and superior customer service to both the business and
residential markets. The Corporation provides its digital television
distribution and wireless Internet services using its approximately 100 MHz of
Multipoint Distribution System spectrum in the 2.5 to 2.7 GHz frequency band
covering approximately 18 million people (1.8 billion MHz/Pops) in the
provinces of Ontario and Quebec. Look's shares are listed on the TSX Venture
Exchange under the symbols "LOK" for Multiple Voting Shares and "LOK.A" for
Subordinate Voting Shares. Look's website may be found at www.look.ca.
About Unique Broadband Systems, Inc.
UBS is a publicly listed Canadian company that has a 51.8 per cent fully
diluted economic interest in Look Communications Inc. and other assets. With
its licensed spectrum through its subsidiary, Look, UBS is a Canadian digital
television broadcaster and broadband wireless service provider. The Company's
web site may be found at www.uniquebroadband.com.
Caution Regarding Forward-Looking Information
The corporate information contained in this release includes
forward-looking statements regarding future events and the future performance
of Look that involve risks and uncertainties that could cause actual results
to differ materially. Assumptions used in the preparation of such information,
although considered reasonable by Look at the time of preparation, may prove
to be incorrect. The actual results achieved may vary from the information
provided herein and the variations may be material. Consequently, there is no
representation by Look that actual results achieved will be the same in whole
or in part as those forecasts.
Neither the TSX Venture Exchange nor its Regulation Services Provider (as
that term is defined in the policies of the TSX Venture Exchange) accepts
responsibility for the adequacy or accuracy of this release.
For further information:
For further information: Peter Block, Investor and Media Relations,
firstname.lastname@example.org, (647) 259-3284