TORONTO, Sept. 26 /PRNewswire-FirstCall/ -- Tahera Diamond Corporation (TSX-TAH) (the "Company").
Tahera Diamond Corporation announces that, as a result of the Court-approved marketing process undertaken in the Company's ongoing proceedings under the Companies' Creditors Arrangement Act (the "CCAA"), a Plan Sponsorship Agreement (the "Agreement") has been signed with 0835732 BC Ltd. (the "Plan Sponsor"), a privately held company owned by a group of Vancouver based resource explorationists and developers. The Company will be seeking Court approval of the Agreement on September 29, 2008.
The Plan Sponsorship Agreement contemplates transactions whereby the Company's liabilities will be compromised pursuant to a plan of arrangement under the CCAA (the "CCAA Plan"), with the cash to be funded by the Plan Sponsor being used for payments to creditors and payments of the costs of the CCAA Plan and the Plan Sponsor obtaining 100% of the equity of the Company via a concurrent reorganization pursuant to the Canada Business Corporations Act. The Agreement is subject to a number of conditions, including the completion of satisfactory due diligence by the Plan Sponsor on or before October 31, 2008, and the necessary creditor and Court approvals of the CCAA Plan. It is anticipated that the CCAA Plan will be filed immediately after waiver of the due diligence conditions.
The cash consideration being paid by the Plan Sponsor under the Agreement is insufficient to pay all of the claims of creditors of the Company in full. It is currently contemplated that if the restructuring plan is ultimately approved and implemented, the existing shares of the Company will be cancelled or acquired by the Plan Sponsor which will ultimately acquire the Company. No value will remain available to shareholders as a result of this transaction.
FORWARD LOOKING STATEMENTS
Certain information regarding the Company in this news release including management's assessment of future plans and operations and the timing thereof, may constitute forward-looking statements under applicable securities laws and may necessarily involve risks including, without limitation, risks associated with mineral exploration, development, exploitation, production, marketing and transportation, loss of markets, volatility of commodity and diamond prices, currency fluctuations, imprecision of reserve and resource estimates, environmental risks, competition from other producers, inability to retain services, delays resulting from or inability to obtain required regulatory approvals, the ability to access sufficient capital and the uncertainty involved in Court proceedings and the implementation of the CCAA Plan. As a consequence, the Company'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 events anticipated by the forward looking statements will transpire or occur, or, if any of them do so, what benefits the Company will derive therefrom. Readers are cautioned that the foregoing list of factors is not exhaustive. Furthermore, the forward-looking statements contained in this news release are made as of the date this news release and the Company does not undertake any obligation to update publicly or to revise any of the included forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required by applicable securities laws.
Tahera Diamond Corporation
R. Peter Gillin - Chairman and CEO
