TELEHOP PROVIDES CORPORATE UPDATE AND CALLS SHAREHOLDERS' MEETING
08 Février 2011 - 12:48AM
PR Newswire (Canada)
TORONTO, Feb. 7 /CNW/ -- TORONTO, Feb. 7 /CNW/ - Telehop
Communications Inc. (TSXV-HOP), a leader in the telecommunications
services industry, announces that in light of recent events its
board of directors (the "Board") believes that an update to its
shareholders is appropriate. The Company will expand upon this
update at an annual and special meeting of shareholders to be held
on Wednesday, May 25, 2011 (the "Meeting") at which time the
Company will more fully outline how it believes it can best
accomplish its strategic goals of growing its business through
acquisitions and internally: (i) in the HomePhone market and in its
subscription services, through aggressive solicitation of
prospective and existing customers and by targeting ethnic markets,
and (ii) by developing the calling card division of Telehop
into a major player in the Canadian Prepaid Calling card market.
Requisition of Shareholders' Meeting On January 27, 2011, the
Company received a requisition from Mrs. E. Mignonne Spiegelman
(the widow of the founder of Telehop and the reported holder of
1,677,080 common shares, or 12.52% of the issued and outstanding
shares) to call a special meeting of shareholders for the purpose
of removing each of the five current directors and replacing them
with a new slate of seven directors. A resolution to this effect
will be tabled at the Meeting. From recent discussions with Mrs.
Spiegelman, it is clear that Mrs. Spiegelman wishes to replace the
current board so that, among other things, she can assume the
position of Chief Executive Officer of Telehop. The Board has asked
Mrs. Spiegelman on several occasions for a business plan which
would allow the Board to understand what changes she and her
proposed nominees intend to effect and so far none has been
forthcoming. The Board is unanimously of the view that Mrs.
Spiegelman is not qualified to assume the role of Chief Executive
Officer of Telehop and as a result the Board is compelled to
request that shareholders reject the proposal being put forward by
Mrs. Spiegelman. Meeting Further details, including the exact time
and location of the Meeting and record date will be announced in
due course and will be contained in a formal notice of meeting and
management information circular to be mailed to shareholders and
filed on SEDAR at www.sedar.com prior to the Meeting. Shareholders
are encouraged to read the documents carefully and in their
entirety once available. Status of Operations Due to disruptions in
the activities of Telehop because of the death of its founder,
Hersh Spiegelman, the lack of innovation or progress for the
Company in the period preceding his demise, the numerous affairs of
the Company that needed attention and adjustment, and the very
substantial outlays for executive salaries, benefits and the
continuing payment of significant death benefits over a period of
84 weeks (which will finally be fully paid this spring), the
revenues of Telehop and its cash reserves have been eroded. In this
period of disruption, Mr. Fulvio Ciano capably took the position as
CEO and to his considerable credit, recently stabilized revenues
and arrested the decline in EBITDA and activities and put the
Company on a firm footing. Through his efforts, the Board believes
that Telehop is now uniquely positioned to move forward as a
dynamic and respected player in the telecommunications industry.
The Board believes that the Company is now returning to a positive
EBITDA and that profitability is imminent. Staff morale is
excellent. Dedicated employees serve the Company well, and
facilities exist for substantial expansion and forward momentum.
The Company remains debt free, the owner of the premier 10-10-100
long Distance number that is remarkably unique in the industry, one
of Canada's few Equal Access Long Distance Providers, and one of
the very few Class "A" telecommunications carriers, which is
remarkable for Telehop's size. Chief Executive Officer In the
period following the founder's demise, Mr. Ciano was requested to
assume the position of Chief Executive Officer. At the time of Mr.
Ciano's appointment as CEO, he accepted the position on the
condition that it was likely that his mandate would not exceed two
years. Regretfully that time period is now ending and Mr. Ciano has
informed the Board that he is not prepared to remain with the
Company past this two-year period. Mr. Ciano has given notice that
he intends to resign in order to pursue other interests. Mr. Ciano
is managing his departure date to co-ordinate with the timing of
the engagement of his successor. The Board wishes to express its
sincere appreciation for the fine efforts made by Mr. Ciano under
very trying circumstances and the remarkable restructuring of the
affairs of the Company under his stewardship. The Board wishes Mr.
Ciano well in his future endeavors. The Compensation Committee,
under the direction of the Board, has initiated a search for a
suitable CEO. Private Placement Because of the large payout of
death benefits to the estate of the Company's founder, and the
operating losses in recent years before stability was re-achieved,
much of the cash reserves of the Company were dissipated. In order
to properly position the Company for acquisitions, for expansion,
for improvements to its facilities and for increasing marketing
activity and the acquisition of additional customers, the Board
believes that the Company needs additional liquidity and therefore
a private placement is required. Accordingly, and subject to
regulatory approval including that of the TSX Venture Exchange ,
Telehop intends to complete a private placement of common shares or
common shares and warrants for gross proceeds of $2,000,000 to
$3,000,000 (the "Offering"). Telehop expects to pay a finder's fee
in respect of securities sold by qualified finders pursuant to the
Offering. The Company will provide further details regarding this
proposed financing within the next several weeks. The net proceeds
of the Offering will be used to give effect to the Company's
strategic goals, and for working capital. Certain insiders and
related parties of Telehop will be allowed to participate in the
Offering in order to ensure that they are not deprived of the
opportunity to maintain their current percentage ownership in the
Company. The participation of such persons in the Offering may
compel the Company to seek shareholder approval of such
transaction. In such circumstances, shareholder approval would be
sought at the Meeting and the closing of the Offering would be made
subject to such shareholder approval. In determining shareholder
approval, the votes held by all such related parties who
participate in the Offering may be excluded in accordance with
applicable securities laws. Receipt of Expressions of Interest In
the period since the founder's demise, and over the past few
months, the Board has received informal and unsolicited
communications from arm's length third parties purportedly offering
to acquire at least a majority of the outstanding common shares of
the Company. The Board has determined that the offers are either
not capable of being accepted or simply objectionable in light of
the conditions and/or offer price. The Board has not and is not
pursuing any such or similar transactions, but is mindful of the
desire of all shareholders to enhance shareholder value. The Board
is firmly of the view that, at this moment in time, the best way to
enhance shareholder value is to pursue the Company's strategic
goals. The Board believes that the Company is uniquely positioned
and has unique assets that are not currently recognized by the
market value of its shares. About Telehop Communications Telehop
was founded and is headquartered in Toronto, Ontario, since 1993,
and has grown into an alternative telecommunications provider to
both residential and business customers. Telehop originally began
offering residential and business two-way monthly 'flat rate'
calling services in the Greater Toronto area between communities
where a call would otherwise be a long distance call. In 1994,
Telehop became one of Canada's few Equal Access Long Distance
Providers, allowing it to offer its customers full service long
distance calling globally at significantly lower rates. The
Canadian Radio-television and Telecommunications Commission (CRTC)
has licensed Telehop as a Class "A" telecommunications carrier.
Telehop's dedication and priority is providing homes and businesses
with exceptional phone services at competitive rates without
sacrificing quality or service. With Telehop, Satisfaction is
Everything. 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. Forward-Looking Information This news
release contains forward-looking information and forward-looking
statements (collectively "forward looking statements"), within the
meaning of applicable securities laws, including with respect to
the Company's intention to complete a private placement, give
effect to strategic goals and initiatives and return to
profitability. Such forward looking statements are based upon
assumptions, and estimates made by the Board and management in
light of its experience, current conditions and its expectations of
future developments as well as other factors which it believes to
be reasonable and relevant. Forward looking statements involve
known and unknown risks, uncertainties and other factors that may
cause our actual results to differ materially from those expressed
or implied in the forward looking statements and, accordingly,
readers should not place undue reliance on those statements. Risks
and uncertainties that may cause actual results to vary include,
but are not limited to, the Company's ability to complete the
aforementioned private placement including obtaining shareholder
approval thereof if required, the decision by the shareholders at
the Meeting with respect to which directors are elected, economic
and market conditions, the ability of the Company to retain a
suitable CEO on a timely basis and those more fully described in
the Company's Management's Discussion and Analysis for its 2010
fiscal quarters and in other Company filings with securities
and regulatory authorities which are available at www.sedar.com.
Should one or more risks and uncertainties materialize or should
any assumptions prove incorrect, then actual results could vary
materially from those expressed or implied in the forward looking
statements and accordingly, readers should not place undue reliance
on those statements. Readers are cautioned that the foregoing lists
of risks, uncertainties, assumptions and other factors are not
exhaustive. The forward looking statements contained in this news
release are made as of the date hereof and the Company undertakes
no obligation to update publicly or revise any forward-looking
statements contained herein or in any other documents filed with
securities regulatory authorities, whether as a result of new
information, future events or otherwise, except in accordance with
applicable securities laws. To view this news release in HTML
formatting, please use the following URL:
http://www.newswire.ca/en/releases/archive/February2011/07/c8719.html
pMr. Fulvio Cianobr/ CEObr/ (416) 494 4490br/ a
href="mailto:fciano@telehop.com" cr="true"fciano@telehop.com/a/p
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