Here is the news release.......comments are welcome
DataWave Systems Inc DTV
Shares issued 26,873,374 Jan 11 close $0.40
Tue 12 Jan 99 News Release
Mr. Clive Barwin reports
DataWave Systems and Chadwell Hall Holdings Ltd. (CHH) have signed an agreement to merge DataWave into Chadwell Hall, a privately held British Virgin Island company. CHH must offer to acquire all of the issued shares of the company from the shareholders on or before May 1, 1999, provided certain conditions are met. In consideration for their DataWave shares, each shareholder of the company will receive common shares of Clariti Telecommunications International Ltd., a Delaware company owned by CHH. CHH is a holding company that has numerous telecommunications investments
throughout Europe and is a large shareholder of Clariti. Clariti is a telecommunications company that is traded on the Over the Counter Electronic Bulletin Board in the United States under the symbol CLRI.
Clariti is pursuing a business strategy of bringing innovative, affordable telecommunications products and services to markets worldwide. Clariti is developing the world's first low-cost digital voice paging system for use
on FM radio frequencies, based on Clariti's patented technology. Clariti has recently acquired Global First Holdings Ltd. from CHH in a share for
share exchange. Global is now a 100 per cent owned subsidiary of Clariti with expected 1999 revenues to exceed $100-million (U.S.).
CHH and the company have agreed upon a valuation of the company of $12-million (U.S.) (after the company converts approximately $4-million (U.S.) of debt into equity) and on an exchange ratio of one Clariti share
for the requisite number of DataWave common shares to achieve this valuation, based on the trading price of Clariti shares as of the effective
closing date of the merger. In no event shall the exchange ratio of DataWave shares for Clariti shares exceed 12:1. The valuation and exchange
will be subject to a fairness opinion to be provided to an independent committee of the company's board of directors.
The merger will be completed under a plan of arrangement under British Columbia law.
The offer is also conditional upon the following: that one-half of the shares of the company currently held in escrow be released and the remaining one-half cancelled on or before the closing date of the merger; and that the company issue shares in exchange for its indebtedness to ATTI in the amount of $3-million (U.S.) and certain other trade payables in the amount of $1-million (U.S.) prior to completion of the merger. The exchange of this debt into shares will be done based on the closing price of Clariti's shares prior to the closing of the transaction.
Clariti's share price is currently approximately $2.00 (U.S.). If at the date of completing the merger the price of Clariti's shares is still
trading at $2.00 (U.S.), the company's shareholders can expect to receive one Clariti share for every 6.34 DataWave shares. If Clariti's share price
is below $2.00 (U.S.) at the time of completing the merger, then DataWave shareholders would receive more Clariti shares. Conversely, if the price is higher than $2.00 (U.S.), then DataWave shareholders would receive fewer
Clariti shares, subject to a maximum exchange ratio of 12 DataWave shares for each Clariti share.
The directors of the company expect to recommend the acceptance of the offer subject to a satisfactory fairness opinion being obtained.
Paul |
