TIKRF ikcro Sends Letter to Shareholders

ikcro Sends Letter to ShareholdersBusiness Wire "US Press Releases "
TEL AVIV, Israel--(BUSINESS WIRE)--
Tikcro Technologies Ltd. (OTCBB: TIKRF) today announced the mailing of the following letter to all Tikcro shareholders: November 13, 2007
Dear Fellow Shareholders:
I am writing to update you on the efforts of your Board of Directors
to maximize shareholder value and to address some public comments
recently made in a letter from a shareholder of Tikcro.
Our Course of Action
As you know, Tikcro sold all of its operating assets in April 2003.
Since then, we have explored various alternatives and business
opportunities. To date, Tikcro has evaluated numerous potential
business combinations and other opportunities with a variety of
companies. Our goal has always been to explore the best course of
action for Tikcro that would maximize shareholder value in the long
run.
Consistent with our goal, we explored several potentially interesting
opportunities in the past years and engaged in extensive due
diligence and negotiations in 2007 in connection with two of these
opportunities. One involved a company with which we had signed a
letter of intent. However, we decided to terminate the discussions
due to the discovery of certain information during the course of our
due diligence review. Thereafter, we became actively involved in
negotiating another potentially attractive acquisition opportunity.
Ultimately, the target's board of directors decided to pursue other
financing alternatives.
The Reality about Management's Efforts and its Compensation
We were disappointed to learn from comments made by that certain
shareholder that there is a perception that management is over paid.
In reality, the facts demonstrate that the opposite is the case.
Since May 2003, I have served as Tikcro's Chief Executive Officer for
no compensation, and our four directors (including myself) have
received compensation of only $1,000 per Board meeting. (Our two
statutory outside directors also receive 11,000 stock options per
year at the market price of Tikcro's shares at the time of
shareholder approval.) During this period, Tikcro had no officers or
employees on its payroll. All the work on potential transactions was
accomplished under the direction of Eric Paneth, who is also a large
shareholder and director of Tikcro, and me without any compensation
to us.
We imposed strict financial discipline at Tikcro which, combined with
the lack of employee compensation expense, preserved Tikcro's primary
asset, its cash. As a result, Tikcro's cash position has increased
over the past several years.
With respect to compensation, and further to comments made by the
shareholder, I would like to clarify the basis for the Board's
proposal last year to grant stock options to Eric Paneth and to me, a
proposal that was ultimately withdrawn by us. The proposal involved
the grant to Eric and me of stock options at Tikcro's market price on
the date of grant that would vest only if there was significant
increase in the price of Tikcro's shares. While Eric and I ultimately
decided to waive this proposal, it is important for our shareholders
to understand the rationale and terms of this proposal.
The Board appreciated that our efforts on behalf of Tikcro were
performed without any compensation to us. Because Eric and I did not
want to receive any compensation unless we succeeded in significantly
enhancing shareholder value, the Board created a proposal to grant us
contingent stock options that would be linked to significant
increases in Tikcro's share price.
In his letter, the shareholder stated that these options were to be
issued at "a price that was significantly below the cash value of
Tikcro's ordinary shares." In reality, the options were to be granted
at the market price of Tikcro's shares at the time of shareholder
approval. Also, the shareholder failed to mention in his letter that
vesting of the options would have occurred in three installments,
only on the condition that the market price of Tikcro's shares would
have increased by 200%, 300% and 400%, respectively.
It is quite amazing that the shareholder felt the need to discuss and
misconstrue a proposal that was ultimately withdrawn. We just want to
set the record straight.
Shareholder's Proposed Transaction
In his letter, the shareholder referred to a particular transaction
that he had introduced to Tikcro. Your Board of Directors gave
serious consideration to that proposed transaction and tried to
negotiate terms that would be satisfactory to Tikcro. However, the
other party was inflexible, and your Board decided in good faith to
terminate the discussions.
Going Forward
Going forward, we are still committed to maximize shareholder value
and explore strategic alternatives that are in the best interests of
Tikcro's shareholders. We will continue to diligently explore the
best course of action for Tikcro, including attempting to merge or
effect a business combination with another company or to acquire
minority stakes in one or more operating companies. We continue to
seek opportunities that will benefit all of Tikcro's shareholders and
look forward to your continued support.
Very truly yours,
Izhak Tamir
Chairman of the Board
and Chief Executive Officer
About Tikcro Technologies:
Until the closing of the Assets Transaction with STMicroelectronics in 2003, Tikcro Technologies Ltd. (formerly known as Tioga Technologies Ltd.) developed standard integrated circuits (ICs) for broadband communications applications. Substantially all of its assets and related liabilities were sold to STMicroelectronics. Tikcro is headquartered in Tel Aviv, Israel. For more information, visit Tikcro website at www.tikcro.com.
Safe Harbor Statement
Certain of the statements contained herein may be considered forward-looking statements that involve risks and uncertainties including, but not limited to, risks related to the asset purchase agreement with STM and risks of operations in Israel. Such risks and uncertainties are set forth in the Company's SEC reports including the Company's Form 20-F. Actual results may materially differ. Results of operations in any past period should not be considered indicative of the results to be expected for future periods. We undertake no duty to update any forward-looking information.
Source: Tikcro Technologies Ltd.