OMT Inc.
TSX VENTURE : OMT

OMT Inc.

May 27, 2009 13:14 ET

OMT Announces Sale of Intertain Media

WINNIPEG, MANITOBA--(Marketwire - May 27, 2009) - OMT Inc. (the "Corporation") (TSX VENTURE:OMT) announced today that it has entered into a letter of intent dated May 12, 2009 (the "Letter of Intent") with respect to the sale by the Corporation of all of the issued and outstanding common shares (the "Intertain Shares") of Intertain Media Inc. ("Intertain"), a wholly-owned subsidiary of the Corporation (the "Transaction") for aggregate consideration estimated to be $172,500.

Intertain Media Inc. is currently a division of the Corporation that deploys background music, in-store messaging, on-hold features and digital signage services to retail and commercial clients across Canada.

The Corporation undertook a 10 month process to seek interested parties to acquire Intertain, employing the services of a professional advisor. The Board of Directors had determined that the potential sale of Intertain would be in the best interest of the company considering Intertain had experienced limited recent growth and would require continued investment to realize its possible future potential.

At the conclusion of this sale review process, the independent directors of the Corporation considered three proposals, two proposals external to the corporation and a proposal from Mr. Bill Baines, Chief Executive Officer of the Corporation. The independent directors of the Corporation considered all of the proposals received and determined that the proposal from Mr. Baines was superior in a number of ways, including total valuation, certainty of closing and the ability to participate in potential future transactions involving Intertain, and unanimously approved the Transaction. The purchaser of the Intertain Shares will be Bill Baines, Chief Executive Officer of the Corporation and / or related parties (the "Purchaser"). Mr. Baines will also continue in his role of CEO of OMT Inc.

"With the favourable conclusion of this transaction," stated Murray Bamforth, an Independent Director, "the Corporation is now better positioned to focus on growing its much larger iMediaTouch radio broadcast automation business."

The consideration for the Intertain Shares is estimated to be $172,500, subject to adjustments as set forth below, and will be paid by the Purchaser as follows:

(a) $50,000 is payable by the Purchaser on the closing date, net of all closing entries. The $1.3 million intercompany payable from Intertain to the Corporation is excluded from the liabilities assumed by Intertain at the time of the closing of the Transaction;

(b) Intertain (once owned by the Purchaser) will pay to the Corporation an amount equal to 50% of the actual gross margin on of a specified customer contract now underway (currently estimated to be $32,500) upon receipt by Intertain of the final cash payment from the customer; and

(c) Intertain (once owned by the Purchaser) will pay to the Corporation $90,000, $30,000 of which is payable on each of the first, second and third anniversaries of the closing of the Transaction.

The Letter of Intent also provides that the Corporation will realize additional benefits in the event that the Purchaser subsequently sells the Intertain Shares, or the intellectual property of Intertain, within one year of the closing date of the Transaction.

The Corporation will pay a fee to Wellington West Capital Inc. in an amount of up to 7% of the gross proceeds to the Corporation in consideration for its services provided in assisting in the solicitation of offers for the Intertain Shares. The Transaction will have an effective date of May 31, 2009 and a closing date soon thereafter. The closing of the transaction is subject to certain conditions, including final required approvals, and the completion and execution of a definitive purchase and sale agreement.

The Transaction is supported by GrowthWorks Canadian Fund Ltd. and Renaissance Capital Manitoba Ventures Limited Partnership, which own 22.08% and 29.44% of the outstanding common shares of the Corporation, respectively. Accordingly, the Transaction is exempt from the formal valuation requirement and the minority security holder approval requirements of Exchange Policy 5.9 by virtue of the fact that the Transaction is supported by two control persons of the Corporation who are not interested parties with respect to the Transaction.

About OMT

OMT Inc. (TSX VENTURE:OMT) is a technology solutions and content provider to the broadcast, entertainment and retail industries across North America and Internationally. iMediaTouch is OMT's radio broadcast solution used by our clients to distribute audio content heard by millions of people worldwide through television, radio, satellite, cable and internet broadcasts. To learn more about our Company, products and services, visit www.omt.net.


Contact Information

  • OMT Inc.
    Bill Baines
    Executive Chairman, President and Chief Executive Officer
    (204) 949-0795
    Email: bbaines@omt.net
    or
    OMT Inc.
    Murray Bamforth
    Independent Director
    (204) 770-3800
    Email: mbamforth@msn.com
    Website: www.omt.net