HTN Inc.

July 08, 2011 10:32 ET

HTN Inc. Enters Agreement to Sell Assets

TORONTO, ONTARIO--(Marketwire - July 8, 2011) -


HTN Inc. ("HTN" or the "Company") (TSX VENTURE:HET) announces that, subject to applicable regulatory and shareholder approval, it has entered into an asset purchase agreement (the "Agreement") with an arm's length Ontario based private corporation ("Privco"), to sell all or substantially all of the assets of HTN, the majority of which are currently held in the wholly owned private subsidiary HTN (Ontario) Inc. ("HTN Ontario") to Privco in exchange for cash (the "Transaction").

Under the terms of the Agreement, HTN will receive up to $1.8 million dollars in cash, with $1.6 million being received upon closing and an additional (a) $100,000 and up to (b) $200,000 to be received one year after closing, based on the retention of at least (a) 500 or up to (b) 1,000 of the Company's existing clients at the end of the first year after closing of the Transaction.

It is management's current expectation that on conclusion of the Transaction, the Company will use the proceeds received from the sale of its assets to discharge any remaining liabilities of the Company, wind-up and dissolve HTN Ontario and distribute the Company's remaining cash to its shareholders. Management presently anticipates that it will maintain HTN as a public shell for a possible future transaction to attempt to maximize shareholder value. In the event that no suitable transaction for the public shell is found within a reasonable period of time, management anticipates that it would seek shareholder approval to wind-up and dissolve the Company.

An Annual and Special Meeting of Shareholders (the "Meeting") has been called for August 30, 2011 to consider (i) the annual business of the Company; (ii) a resolution which would approve the Transaction as contemplated in the Agreement; and (iii) a resolution to approve the delisting of the Company from the TSX Venture Exchange and listing on the NEX board of the TSX Venture Exchange. The resolution to approve the Transaction must be approved by two-thirds of the votes cast at the meeting.

The decision to sell substantially all of HTN's assets resulted from a lengthy review of strategic alternatives available to the Company by the board of directors of HTN. In their continuing efforts to preserve shareholder value, the Company negotiated the Transaction which provides Shareholders with an opportunity to realize value for their shares in the context of the Company's present circumstances. Currently, the Company's revenue base is severely threatened by recent changes to the availability of funding and the increasingly prohibitive and expensive certification requirements, imposed on vendors, to achieve such funding. With the newest certification program, clients will receive funding for purchasing certified products as opposed to the Company's existing products, unless they are certified. As a result, the Company is facing the potential rapid loss of its client base to competing vendors with certified products. Privco, a competing company with a certified product which is significantly larger than HTN (in terms of annual revenues and resources), will ensure the Company's current clients receive continuity in service and additional product opportunities, including the opportunity to receive funding.

Based on the Company's review of strategic alternatives, and after reviewing the merits of the Transaction, the Company is of the view that the consideration to be received for the Transaction from Privco is believed to be in excess of the price that could be received through any other process in a reasonable timeframe. In this context, the HTN board of directors believes the actions announced today are in the best interests of HTN and its shareholders, as they present the possibility of the Company's shareholders receiving a special dividend out of the proceeds of sale of the Transaction. The board of directors unanimously recommends that shareholders vote in favour of the Resolution.

The Agreement contains customary terms and conditions for an agreement of this nature including the ability of the Board to respond to any superior proposals that may be received prior to closing of the Transaction, and contains a $100,000 break fee payable in certain circumstances. As part of the Transaction, it is expected that certain members of the Company`s management team, employees and contractors will receive offers of employment from Privco on comparable terms to their current employment.

HTN anticipates that a proxy and information circular for the Meeting, which will provide greater detail on the Transaction, including the anticipated amount of the anticipated dividend, will be mailed to shareholders very shortly and will be available at

About HTN Inc.

HTN Inc. (, an acronym for Health Transaction Network, is a medical/healthcare information technology company and software support organization, which pioneered the use of on-line healthcare transaction networks in the province of Ontario, Canada, where the company's head offices have been located since the company's inception in 1994. With its flagship HERO™ (Healthcare Electronic Resources On-line) and HERO™ CMS products, HTN Inc. provides the latest in cost effective, computerized automation to medical offices, clinics, hospitals and other medical facilities – providing users with improved workflow, faster information retrieval and overall operating efficiencies while seamlessly enabling them to electronically exchange/share clinical and transactional information with other healthcare facilities, providers, payers, insurers, patients, and suppliers.

READER ADVISORY: FORWARD-LOOKING STATEMENTS Certain information set forth in this document, including management's assessment of HTN's future plans and operations, closing of the Transaction, creating a shell company and declaration of a special dividend, contain forward-looking statements. By their nature, forward-looking statements are subject to numerous risks and uncertainties, some of which are beyond these parties' control, including the impact of general economic conditions, industry conditions, competition from other industry participants, the lack of availability of qualified personnel or management, stock market volatility and ability to access sufficient capital from internal and external sources. Readers are cautioned that the assumptions used in the preparation of such information, although considered reasonable at the time of preparation, may prove to be imprecise and, as such, undue reliance should not be placed on forward-looking statements. HTN's actual results, performance or achievements could differ materially from those expressed in, or implied by, these forward-looking statements and, accordingly, no assurance can be given that any of the events anticipated by the forward-looking statements will transpire or occur, or if any of them do so, what benefits that HTN will derive therefrom. HTN disclaims any intention or obligation to update or review any forward-looking statements, whether as a result of new information, future events or otherwise. The Transaction may not close when planned or at all or on the terms and conditions set forth herein. The completion of the Transaction is subject to several risks including the failure of HTN to obtain the necessary shareholder, regulatory and other third party approvals or satisfy the other conditions to proceed with the Transaction.

Neither the TSX Venture Exchange nor its Regulation Services Provider (as the term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

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