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Changes in Material Facts of Previously Filed Early Warning Reports of Melbye Skandinavia AS

Apr 18 2013 12:00AM

Marketwire

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CALGARY, ALBERTA -- (Marketwired) -- 04/18/13 -- Pursuant to early warning disclosure requirements of applicable securities laws, Melbye Skandinavia AS ("Melbye") announces that there have been further changes in material facts contained in its early warning reports dated September 6, 2012 and March 18, 2013 (collectively, the "Prior Early Warning Reports"), filed in connection with (1) the acquisition by Melbye from Werklund Capital Corporation ("Werklund") of a 50% undivided interest in the $6,000,000 principal amount debenture (the "Debenture") granted by RS Technologies Inc. ("RS") to Werklund and dated July 2011 (and executed and delivered on or about July 5, 2011), as well as the security and ancillary documents related to the Debenture, (2) final advances under the Debenture by Melbye and Werklund, (3) the application of RS to the Alberta Court of Queen's Bench (the "Court") under the Companies' Creditors Arrangement Act (Canada) (the "CCAA") for protection from its creditors, in respect of which the Court granted an initial order on March 14, 2013 (the "Initial Order"), among other things, staying all proceedings against RS until April 12, 2013, and (4) the grant by Melbye and Werklund of an interim credit facility (the "Interim Facility") in favour of RS to finance its operations and costs incurred during the CCAA proceedings. In the Initial Order, the Court approved a maximum amount available under the Interim Facility of $750,000.

On April 11, 2013, the Court granted RS's application for an extension of the stay of proceedings contained in the Initial Order under the CCAA to June 28, 2013.

In conjunction with the CCAA proceedings of RS, FTI Consulting Canada Inc., in its capacity as a court-appointed monitor (the "Monitor"), applied for and obtained an order (the "SISP Order") approving sale and investor solicitation procedures (the "SISP"), pursuant to which the Monitor was authorized and directed to solicit bids from interested parties to purchase all of the assets or shares of RS. The complete terms of the SISP are appended to the SISP Order.

In the SISP Order the Court also authorized and directed the Monitor and RS to execute an asset and share purchase agreement (the "Stalking Horse Credit Bid") with Melbye and Werklund, and declared that such agreement was a stalking horse credit bid for the purposes of the SISP. Under the Stalking Horse Credit Bid, Melbye and Werklund offered to purchase either (1) all of a new class of shares of RS (the "Share Purchase"), conditional on, among other things, the approval and sanctioning of a plan of compromise and arrangement under the CCAA and the Business Corporations Act (Alberta), or (2) all of the assets of RS (other than certain excluded assets) (the "Asset Purchase"), provided certain conditions are satisfied. The purchase price under the Stalking Horse Credit Bid is the aggregate of the amounts outstanding under the Debenture and the Interim Facility, as well as the aggregate of certain obligations of RS, including the accrued and unpaid priority payables, unpaid restructuring costs (including the professional costs of the Monitor and of counsel to the Monitor and RS) and the amount outstanding under a key employee retention plan.

The form of the Stalking Horse Credit Bid has been appended to the Second Report of the Monitor dated April 10, 2013 prepared in the CCAA proceedings of RS.

Under the Stalking Horse Credit Bid, Melbye and Werklund are to each acquire one-half of the shares of RS in a Share Purchase, or an undivided one-half interest of the applicable assets of RS in an Asset Purchase. Melbye and Werklund currently intend to acquire all of the shares or assets of RS pursuant to the Stalking Horse Credit Bid.

If closing of the Stalking Horse Credit Bid does not occur in stipulated circumstances, a break-fee equal to 3.5% of the purchase price under the Stalking Horse Credit Bid will be payable to Melbye and Werklund.

The Monitor has obtained a Court order permitting an increase in the amount that RS is permitted to borrow pursuant to the Interim Facility. The amount that RS is permitted to borrow under the Interim Facility has been increased from $750,000 (of which $600,000 has been drawn to date, and has been advanced equally by Melbye and Werklund) to a maximum amount of $2,750,000.

There has been no change in the ownership of the Debenture by Melbye and Werklund from that reflected in the Prior Early Warning Reports.

Melbye will be filing a related early warning report as required by National Instrument 62-103.

Further information may be obtained by contacting Christian Aasheim, Chief Executive Officer of Melbye, at: Telephone: 011 47-63-87-0151 and Facsimile: 011 47-63-87-0151. Melbye's head office is located at Probst Stabelsvei 22, 2012 Skedsmokorset, Norway.



Contacts:
Melbye Skandinavia AS
Christian Aasheim
Chief Executive Officer
011 47-63-87-0151
011 47-63-87-0151 (FAX)





Source: Marketwire


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