TORONTO--(BUSINESS WIRE)--

Telehop Communications Inc. (TSX-V:HOP) announced it has agreed with its debenture holders to effect a partial conversion into common shares and reduce the interest rate on the remaining balance and extend the final maturity date. The particulars of the restructuring are as follows:

1. That effective December 31^st, 2016, the interest rate on the debentures shall be reduced from 10% per annum to 7.5% per annum;

2. That the Corporation be required to pay $150,000 of principal on the 31^st of December, 2018, and a further $300,000 principal on the 31^st of December 2019, and the balance of the principal outstanding on the 31^st December 2020;

3. That any prepayment of principal other than as set out in the foregoing paragraph, be accompanied by penalty payment of 2% of the amount of principal prepaid;

4. That the repayment of the principal by the Corporation be secured by a general security agreement on all of its assets, subject to postponement in favour of any prior general security agreement that may hereafter be issued by the Corporation in favour of the Corporation's institutional banker up to $500,000;

5. That 25% of the principal amount of $3 million excluding accrued interest, namely $750,000 be converted pro rata among all debenture holders into common shares of the Corporation at a price of $0.05 per share, resulting in the issuance of 15 million common shares of the Corporation. Interest shall accrue on the converted portion of the debentures to the date of conversion, and be paid at such time of conversion.

The restructuring is subject to approval by the TSX Venture Exchange.

About Telehop

Telehop was founded and headquartered in Toronto, Ont., in 1993, and has grown into one of the largest alternative telecommunications providers to both residential and business customers.

Telehop originally began offering residential and business two-way monthly flat-rate calling services in the Greater Toronto Area between communities where a call would otherwise be a long-distance call. In 1994, Telehop became one of Canada's few equal-access long-distance providers, allowing it to offer its customers full-service long-distance calling globally at significantly lower rates. Telehop has broadened into home phone, business services and wireless communications.

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