MathStar Board of Directors Responds to Revised Tender Offer from Tiberius Capital II, LLC
27 June 2009 - 6:08AM
PR Newswire (US)
Board Continues Its Recommendation That Stockholders Not Tender
Their Shares to Tiberius Capital II, LLC HILLSBORO, Ore., June 26
/PRNewswire-FirstCall/ -- MathStar, Inc. (Pink Sheets: MATH) today
announced that its Board of Directors continues to recommend that
MathStar stockholders reject the $1.15 per share cash tender offer
from Tiberius Capital II, LLC (Tiberius). On June 22, 2009,
Tiberius issued a press release and filed with the Securities and
Exchange Commission an amended Tender Offer Statement announcing
that it was revising its tender offer to purchase approximately 51%
of the outstanding shares of MathStar, Inc. for $1.15 per share by
extending the tender offer term by approximately 24 hours and
waiving the condition that Tiberius must control MathStar's Board
of Directors. The MathStar Board of Directors continues to
recommend AGAINST shareholders tendering their MathStar shares to
Tiberius for the following reasons: -- The Tiberius tender offer is
a blatantly inadequate offer. The successful completion of the
tender offer would result in Tiberius paying approximately $5.3
million to obtain 51% of MathStar's common stock and control of
MathStar's cash and securities in the amount of $14.0 million, plus
MathStar's intellectual property, representing at least a 62%
discount. -- MathStar believes that Tiberius is attempting to
mislead MathStar shareholders as to the value of MathStar's
technology. In its June 22 press release, Tiberius states that the
market has "rejected the technology." Yet in its original Tender
Offer Statement and press release dated June 1, 2009, Tiberius
states that its potential strategies for MathStar include
exploiting MathStar's technology assets. In addition, in
conversations between John M. Fife of Tiberius and Douglas M. Pihl
of MathStar held in May 2009, Mr. Fife told Mr. Pihl that Tiberius
wanted to retain Mr. Pihl to sell MathStar's technology, which
indicates that as recently as May 2009 Tiberius believed that the
technology has value. -- MathStar believes that Tiberius is
attempting to mislead MathStar's shareholders as to the value of
MathStar's net operating loss carryforwards ("NOLs"). In its June
22 press release, Tiberius characterizes the desire of the MathStar
Board to preserve the NOLs as a "pipe dream." Yet in the
conversations between Mr. Pihl and Mr. Fife in May, Mr. Fife
discussed with Mr. Pihl Mr. Fife's desire and detailed plan to
preserve the NOLs, indicating that he believed they had value. The
Board's reasons for recommending that you reject the Tiberius
tender offer are explained in more detail in MathStar's
Solicitation/Recommendation Statement on Schedule 14D-9, as amended
(MathStar Statement) filed with the Securities and Exchange
Commission (SEC). You may review and obtain copies of the MathStar
Statement and all amendments thereto free of charge at the SEC's
website at http://www.sec.gov/. You may also obtain copies of the
MathStar Statement at http://www.mathstar.com/ or by contacting
calling MathStar's information agent, The Proxy Advisory Group,
LLC, at (888) 337-7699 (888-33PROXY) and requesting a copy.
MathStar's Board continues to conduct due diligence on two
potential opportunities that it believes could enhance shareholder
value. Although MathStar cannot make any assurances, the Company is
optimistic that one of these opportunities could result in a
transaction proposal to shareholders. MathStar's Board has engaged
outside advisors to analyze the business plans, the technology and
the market opportunity for each approach as well as to perform due
diligence and to assist in negotiations. The MathStar Board
believes, assuming successful due diligence and the negotiation of
favorable transaction terms, each of these opportunities offers the
potential to create more value than the Tiberius tender offer.
MathStar will provide shareholders with additional information
should either of these alternatives result in a definitive
agreement. Statements in this press release, other than historical
information, may be "forward-looking" in nature within the meaning
of the Private Securities Litigation Reform Act of 1995 and are
subject to various risks, uncertainties and assumptions. These
statements are based on management's current expectations,
estimates and projections about MathStar and include, but are not
limited to, those set forth in the section of MathStar's Annual
Report on Form 10-K for the year ended December 31, 2008 filed with
the Securities and Exchange Commission on March 31, 2009 under the
heading "Item 1A. Risk Factors" and in our Quarterly Report on Form
10-Q for the quarter ended March 31, 2009. MathStar undertakes no
obligation to update any forward-looking statements in order to
reflect events or circumstances that may arise after the date of
this release. DATASOURCE: MathStar, Inc. CONTACT: Douglas Pihl of
MathStar, Inc., +1-503-726-5500, Web Site: http://www.mathstar.com/
Copyright