CALGARY, Jan. 6 /CNW/ - HSE Integrated Ltd. ("HSE" or the "Company") today announces that it has received a written requisition (the "Requisition") from Forum National Investments Ltd. ("Forum") to call a special meeting of the Company's shareholders (the "Meeting"). The Requisition states that the business to be transacted at the Meeting is to vote on a resolution to remove from office all of the current directors of HSE (the "Board"), and to fill the vacancies with a new slate of directors put forward by Forum. This would include Dan Clozza, CEO of Forum, and Martin Tutschek, CFO of Forum.
Pursuant to section 142 of the Business Corporations Act (Alberta) (the "ABCA"), a registered or beneficial owner of not less than five per cent of the issued common shares of HSE has the right to requisition HSE's directors to call a shareholder meeting. In its Requisition, Forum states that it is the beneficial holder of 3,211,000 common shares of HSE which constituted 8.5% of the 37,575,675 issued and outstanding common shares of HSE on the date of the Requisition.
The Board advises that it has resolved to call the Meeting for the purposes stated in the Requisition for May 14, 2010, the same date as its upcoming Annual General Meeting of shareholders.
The Board believes that the May Meeting date is the appropriate time to deal with Forum's Requisition as it will provide the Company time to complete and distribute to shareholders its Annual Report including the annual audited financial statements for the year ended December 31, 2009, together with the Management's Discussion and Analysis thereon. The Board believes this information is important for shareholders to be able to make a reasoned judgment on the business to be transacted at the Meeting, including the performance of the current Board and whether a new board of directors as put forward by Forum is the best course of action for the Company going forward.
David Yager, Chairman and CEO of HSE, made the following comments regarding this issue:
"The 2009 fiscal year was one of the most challenging for businesses worldwide in recent history. This includes HSE. Our business and revenues shrank due to a decline in commodity prices, capital spending and industrial activity.
Regardless, HSE - under the direction and support of its experienced and dedicated Board of Directors - weathered the storm quite well and is well-positioned in 2010 and beyond to exploit a recovery that began in the second half of 2009. In a highly challenging business environment, HSE maintained its core operating and technical team, all its important business units, the majority of its field service locations, and at the same time substantially reduced long-term bank debt. In addition, HSE opened new service locations and introduced new and valuable services offerings. Throughout 2009 HSE maintained a strong balance sheet. The outlook for 2010 is very encouraging.
HSE understands that its Board of Directors and, ultimately, its executive team, hold their positions at the discretion of the shareholders. We respect the process by which the Board is appointed and elected. We also respect the legal right of a larger shareholder such as Forum to request a meeting to nominate and possibly elect a new Board of Directors.
It should not be overlooked that shareholder meetings are expensive and time-consuming. After considerable internal deliberation, the Board feels that it is not in the best interests of the Company and its shareholders to convene two meetings within the first half of 2010, as the matters set forth in the Requisition can and will be dealt with on the date of the May AGM."
Forum and its CEO, Dan Clozza, are well known to the Board. On July 20, 2009, Forum purported to launch an unsolicited takeover bid for the Company. The bid was to exchange four HSE shares for one share of Forum. Forum trades on the OTC Bulletin Board ("OCTBB") exchange (symbol - FMNLF) in the United States. Forum is primarily in the leisure travel business but also has a business unit in the "life settlement market" that buys life insurance policies from the holder.
In Forum's Offer to Purchase ("Offer") document dated August 12, 2009, Forum explained the mathematics of the transaction in a misleading manner. The arithmetic used by Forum did not take into account the significant dilution impact of the Forum preferred shares and stock options. This dilution would have reduced the value to HSE shareholders significantly.
It should also be noted that since the time of the original bid the trading price of Forum shares has fallen from US$2.90 to US$0.75 (the last trade was on December 18, 2009). Over the last two years Forum stock has fallen from US$18.00 to US$0.75.
Further, the Offer was not in compliance with Alberta securities laws. On application by the Company, the Alberta Securities Commission (the "ASC") convened a hearing on August 25, 2009 to consider the Offer. Following that hearing, the ASC issued a cease-trade against the Offer, as Forum did not comply with Part 14 of the Securities Act (Alberta) (the "Act") in relation to the Bid. The ASC ordered that the distribution on and after August 25, 2009 of any document, record or materials used or issued in relation to the Offer was restrained, permanently, although the Offer had already been mailed to HSE shareholders. This resulted in considerable confusion among shareholders and expense for the Company. In reaching its decision to grant the orders, the ASC specifically noted that: (i) there were numerous repeated prohibited representations to the effect that Forum would be applying to the Toronto Stock Exchange for listing and statements which were in breach of the Act and could mislead investors with respect to the liquidity of Forum shares; (ii) on its face the Forum circular appeared to breach the Act; and (iii) the Offer did not comply in important respects with Alberta securities laws.
Because Forum's takeover Offer was never legally constituted, HSE's Board never issued a formal response to shareholders. However based on the information provided and a preliminary review undertaken, the Board was concerned that the Offer would not represent appropriate value for our shareholders.
HSE is an integrated, national supplier of industrial Health, Safety and Environmental services. From its head office in Calgary, Alberta, it serves its clients from field service locations in Alberta, British Columbia, Saskatchewan, Ontario, Nova Scotia, New Brunswick, Newfoundland-Labrador and Michigan. HSE also operates in Texas through a jointly owned company called Boots & Coots HSE Services LLP. HSE trades on the TSX under the symbol "HSL".
Forward Looking Statements
This news release contains forward-looking information and statements (collectively "forward-looking statements") within the meaning of applicable securities laws concerning, among other things, the Company's prospects, expected revenues, expenses, profits, financial position, strategic direction, and growth initiatives, all of which are subject to risks, uncertainties and assumptions. These forward-looking statements are identified by their use of terms and phrases such as expect, anticipate, estimate, believe, may, will, would, could, might, intend, plan, continue, ongoing, project, objective and other similar terms and phrases. These forward-looking statements are based on certain assumptions and analyses made by the Company based on its experience and assessment of current conditions, known trends, expected future developments and other factors it believes are appropriate under the circumstances. Such forward-looking statements are subject to inherent risks and uncertainties. There is significant risk that the forward-looking statements will not prove to be accurate. Readers are cautioned not to place undue reliance on forward-looking statements as a number of factors could cause actual future results and events to differ materially from that expressed in the forward-looking statements. Accordingly this news release is subject to the disclaimer and qualified by the assumptions and risk factors referred to in the Management Discussion and Analysis in the 2009 third quarter report, in the 2008 annual report, and in other filings with securities commissions in Canada as reported in the Company's profile at www.sedar.com. Any forward-looking statements in this news release speak only as of the date of this news release. Except as required by law, the Company disclaims any intention to update or revise any forward-looking statements to reflect new events or circumstances
SOURCE HSE Integrated Ltd.
For further information: For further information: HSE Integrated Ltd., David Yager, Chairman & CEO, Telephone: (403) 266-1833, E-Mail: firstname.lastname@example.org