--_004_YQXPR01MB2488BFFC792210F6F6617D0BAED20YQXPR01MB2488CANP_ Content-Type: multipart/alternative; boundary="_000_YQXPR01MB2488BFFC792210F6F6617D0BAED20YQXPR01MB2488CANP_" --_000_YQXPR01MB2488BFFC792210F6F6617D0BAED20YQXPR01MB2488CANP_ Content-Type: text/plain; charset="iso-8859-1" Content-Transfer-Encoding: quoted-printable Further to our call this morning pursuant to which you raised your continue= d concerns regarding the unfavourable exchange rate trend which results in = the decrease of a CAD equivalent purchase price based on the initial US$5,5= 00,000 purchase price, the following is a suggested message that you may wa= nt to convey to your contacts at the purchaser: "While we appreciate that we had discussed the unfavourable change in the C= AD/USD exchange rate in a previous call and are reluctant to revisit this i= ssue, the disparity between the prevailing rate in August (when we signed t= he LOI) and the continued trend of the strengthening of the Canadian Dollar= against the US Dollar at the present time has become very significant from= our perspective at this point. The purchase price for the enterprise was = designated in US Dollars, and we naturally calculated the amount that would= be paid to us in CAD at the time. The deal has been pending for many mont= hs however and, since the signing of the LOI, the exchange rate has decreas= ed markedly from over 1.32 to approx. 1.27, resulting in a net decrease of = the purchase price of over CA$280,000. We would respectfully request that the purchase price be designated in Cana= dian currency in order to eliminated the foreign exchange risk on our side.= This is logical, as the corporation and its shareholders deal exclusivel= y in Canadian currency. Our proposal is to confirm the purchase price at C= A$7,140,000, including a holdback of CA$640,000. This figure represents a = compromise between the CAD equivalent of US$5,500,000 at CA$7,282,000 at th= e time that the LOI was signed and the current CAD equivalent based on the = present exchange rate at CA$7,000,000. Establishing the purchase price in CAD would neutralize the currency risk o= n our end and could potentially benefit you if the Canadian Dollar drops in= value prior to closing. We appreciate you considering the above proposal. Yours truly," Michael Gaon Associ=E9 / Partner 514-878-2861 ext. 115 mgaon@kklex.com [kkemail] ______________________________ Kugler Kandestin S.E.N.C.R.L. / LLP Avocats * Lawyers 1, Place Ville-Marie, Suite 1170 Montr=E9al, QC H3B 2A7 Canada T=E9l. : 514-878-2861 Fax : 514-875-8424 www.kklex.com Ce courriel est confidentiel, peut =EAtre prot=E9g=E9 par le secret profess= ionnel et est =E0 l'usage exclusif de son destinataire. Toute autre personn= e est par les pr=E9sentes avis=E9e qu'il lui est strictement interdit de le= diffuser ou de le reproduire. Si le destinataire ne peut =EAtre joint ou v= ous est inconnu, veuillez informer l'exp=E9diteur par courriel imm=E9diatem= ent et d=E9truire ce message