Audiotech Healthcare Corporation - Hearing Healthcare

Acquisition clarrified
Audiotech Healthcare Corp.(AUD-CDNX)
April 4, 2001

Mr. Osvaldo Iadarola reports

In news in Stockwatch April 3, 2001, the company disseminated a news release with respect to the acquisition of an additional share interest in Audiology & Hearing Aid Services Inc. (Idaho) reporting that the company had acquired an additional 40-per-cent share interest in the company.

This press release is intended to clarify the nature and terms of the transaction reported April 3.

Audiotech Healthcare, in fact, has acquired the balance of the shares of Audiology & Hearing Aid Services Inc. (Idaho) and now holds a 100-per-cent share interest in the company. Audiotech had originally acquired a 50-per-cent share interest in Audiology & Hearing Aid Services Inc. (Idaho) in July, 1998.

Payment in full has been made for an additional 40-per-cent share interest in the amount of $153,000 (U.S.). As payment for the balance of 10 per cent of the shares, Audiotech Healthcare delivered to the vendor, Dr. Gerald Mill, a promissory note in the amount of $42,500 (U.S.) payable on or before Sept. 1, 2001. Pending payment in full of the promissory note, the remaining 10 per cent of the shares of Audiology & Hearing Aid Services Inc. (Idaho) are held in escrow. Upon satisfaction of the promissory note, the remaining 10-per-cent share interest will be released to Audiotech Healthcare.

Audiology & Hearing Aid Services Inc. (AHAS) currently operates hearing care clinics in Idaho Falls and Rexburg, Idaho, which generate combined annual revenues of approximately $1-million (Canadian). Dr. Mill, PhD, the founder of AHAS, has agreed to remain as a director of AHAS following the completion of the transaction. Dr. Mill has been instrumental in the growth and successful operation of AHAS since its inception.

Commenting on the acquisition, Audiotech president and chief executive officer, Osvaldo (Ozzie) Iadarola, said: "AHAS has proven to be one of our most profitable business units. We fully anticipate that this transaction will have a meaningful positive contribution to Audiotech's operating earnings. Of equal importance, we feel that we have proven the success of our U.S. acquisition model from both an operational and financial perspective. The experience derived from our acquisition of AHAS will be employed as we continue to seek further acquisitions in the Northwest U.S. We presently have negotiations ongoing on several fronts and hope to be in a position to announce a definitive agreement shortly."