On November 2, 2022 TAAL announced that it had entered into a definitive acquisition agreement where Calvin Ayre, who currently owns approximately 38.5% of the outstanding common shares, would indirectly acquire all of the remaining common shares by way of a statutory plan of arrangement and take the Company private. The full news release can be found here.

Given this news the Company wants to make sure that investors have a resource, as many of you have been reaching out with questions. Below are some frequently asked questions and answers about the transaction.

An information circular is expected to be sent to shareholders and filed on SEDAR in late November for the special meeting of shareholders proposed to be held in late December 2022. Investors should read the circular to understand their rights and options concerning the transaction.
 

FAQ

 
1. What is the timeline for the go private transaction and when is it expected to close?

  • The Company expects to mail an information circular for a Special Meeting in November 2022 and hold the Special Meeting in late December 2022. If approved by shareholders, the transaction is expected to close shortly following the Special Meeting.

 
2. Has the Board of Directors approved the transaction?

  • Following a unanimous recommendation from a special committee of independent directors, the Company’s Board of Directors unanimously approved the go-private transaction. We unanimously recommend that shareholders vote in favour of this transaction at the special meeting of shareholders to be held to approve the transaction.

 
3. Has the company received a third-party fairness opinion?

  • Leede Jones Gable Inc. acted as the special committee’s independent financial advisor and provided an opinion that as of November 2, 2022 and subject to the assumptions, limitations and qualifications to be set out in the fairness opinion letter, the consideration to be received by the Company’s shareholders (other than Mr. Ayre) is fair, from a financial point of view, to shareholders.

 
4. How did the Board determine this is this best path forward for the Company?

  • A special committee of independent directors (the “Special Committee”) comprised of Deborah Rosati, Marco Strub, Michael Darcy and Daniel Diemers reviewed the transaction. The Special Committee worked with Leede Jones and independent legal advisor Skylaw Professional Corporation to review the transaction. Both the Special Committee and the Board determined that the Transaction is in the best interests of the Company and fair too.

 
5. I am a shareholder what are my options?

  • As a shareholder, you have the option to vote for or against this transaction. As always, you can also indirectly vote by selling your shares in the open market or buying more.
  • Shareholders will also have a right to “dissent” to the transaction. Further details will be available in the circular in connection with the special meeting.

 
6. If the transaction closes what should shareholders expect?

  • If the transaction closes, as a shareholder you will receive C$1.07 per share, after which you will neither have ownership in the Company nor future voting rights. TAAL shares will cease trading on the Canadian Securities Exchange and the Over-the Counter market.

 
7. When and how do shareholders vote on this transaction?

  • The Company expects to mail and file on SEDAR an information circular for a special meeting of its shareholders in November 2022 and hold the special meeting in late December 2022. If approved by shareholders, the transaction is expected to close shortly following the special meeting.

 
8. Will we receive cash for our public shares or do we become private shareholders?

  • Pursuant to a court-approved plan of arrangement, the acquiror will purchase all of the common shares not currently owned at a price of C$1.07 per common share in cash.

 
9. If I have warrants in the Company what will happen?

  • You can exercise your warrants prior to the special meeting of the shareholders, in that case you would be able to vote the shares at the meeting. If the transaction proceeds thereafter you would then receive C$1.07 per share or if the go-private transaction does not proceed, you can hold or sell the shares from your exercised warrants.
  • If you do not exercise your warrants prior to the special meeting of the shareholders, all out-of-the-money warrants will be cancelled. Any in-the-money warrants will receive a cash amount equal to the in-the-money amount. At this time according to our records all warrants are currently out-of-the-money.

 
10. I own options, what are my options and what do I need to do?

  • You can exercise your options prior to the special meeting of the shareholders, in that case you would be able to vote the shares at the meeting. If the transaction proceeds thereafter you would then receive C$1.07 per share or if the go-private transaction does not proceed, you can hold or sell the shares from your exercised options.
  • If you do not exercise your options prior to the special meeting of the shareholders, all out-of-the-money options will be cancelled. Any in-the-money options will receive a cash amount equal to the in-the-money amount. According to our records all options are currently out-of-the-money.

 
11. Why does management and the Board believe going private is the best option?

  • As you know, TAAL is transitioning to become a Metanet Services Provider. Metanet is the next generation of global data commerce, whereby transactions are completed without third-party intervention. We have traction now, with several early adopters of our Metanet solutions. However, building this next growth phase will require significant capital, which may be challenging to obtain during these volatile markets without significantly diluting existing shareholders. With the support of an existing major shareholder, our Board determined that going private would be the best option to optimize shareholder return at this moment in the Company’s evolution.
  • Further details of what led to the Board’s decision will be provided in the circular for the special meeting of the shareholders.

 
12. Why has management not sought competing offers?

  • Management is permitted to seek competing offers until the transaction is final, however, such offers are very difficult to secure and management has been unable to date to finalize an acceptable financing to fund TAAL’s activities or to attract a competing offer. Metanet Services is a very new industry where little consolidation has occurred. Several other significant companies in the blockchain technology space have failed or are facing bankruptcy.
  • This go-private opportunity came up quickly from a major supporting shareholder and was offered at almost a 40% premium to TAAL’s 10-day volume weighted average price. Management and the Board determined that delaying accepting the offer in the face of increased operating costs and possible lower coin prices would have likely resulted in lower valuations for TAAL and therefore a lower per/share offer price.

 
13. What is the plan for the business once it goes private?

  • As part of the going private process, the buyer has asked the management team to continue business as usual activity and support customers and all existing approved Q4’22 projects. However, all new Opex and Capex investments are on hold until the outcome of the going private transaction has been determined.

 
14. Should this transaction get approved, will TAAL’s business or revenue models change?

  • For now, TAAL’s operations will continue as before and therefore our business and revenue models. However, this does not mean that it could not change in the future as opportunities present themselves.

 
15.If I have other questions is there anyone to contact?

  • For further information, contact: