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Publish Date : 03-May-2013

Veramark Technologies, Inc. (the "Company"), a leading provider of Telecom Expense Management ("TEM") solutions, today announced that it has entered into a definitive merger agreement with Varsity Acquisition LLC ("Varsity") and All Big Ten Holdings, Inc., a wholly-owned subsidiary of Varsity ("Merger Sub") under which Merger Sub will acquire all of the outstanding common stock of the Company, par value $0.10 per share, for $0.98 per share in cash. The $0.98 per share price represents a 38% premium over the 90-day average of the Company's shares and a 29% premium to the closing price of the Company's shares on April 30, 2013.

A special committee of the Company's Board of Directors, consisting solely of independent directors, and the Company's Board of Directors have both unanimously approved the transaction. The Special Committee undertook deliberate and comprehensive negotiations with Varsity to obtain an attractive cash offer for the Company's shareholders. In determining whether to approve the transaction, the Special Committee also obtained and considered a fairness opinion from an independent third-party advisor. The Special Committee ultimately concluded that Varsity's offer is fair to, and in the best interest of, the Company's shareholders.

Under the terms of the agreement, Merger Sub will commence a tender offer to purchase all outstanding shares of the Company on the fifth business day following the end of a 45-day "go-shop" period. Merger Sub's obligation to purchase the shares of the Company's common stock tendered in the tender offer is subject to certain conditions, including that the number of shares of the Company's common stock that have been validly tendered and not properly withdrawn, together with the shares beneficially owned by Varsity or Merger Sub, if any, represent at least a majority of the outstanding shares of the Company's common stock.

If Merger Sub owns at least 90% of the Company's outstanding shares as a result of its current shareholdings, shares tendered in the tender offer and the issuance of new shares by the Company pursuant to a "top-up" provision in the merger agreement, Merger Sub intends to cause the Company to enter into a short-form merger pursuant to which shares not tendered in the tender offer would be converted into the right to receive $0.98 per share in cash without interest. If Merger Sub does not own at least 90% of the Company's outstanding shares as a result of its current shareholdings, shares tendered in the tender offer and the issuance of new shares by the Company pursuant to the top-up provision in the merger agreement, the Company intends to solicit proxies from its shareholders in support of a merger between the Company and Merger Sub.

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