SHERBROOKE, QC, Aug. 12 /CNW Telbec/ - Shermag Inc. (TSX:SMG) and its
subsidiaries (the "Company") today announced that it has obtained from the
Québec Superior Court the authorization to proceed with a transaction between
the Company and Groupe Bermex Inc. ("Bermex") further to Bermex's offer which
was accepted by the Company on July 31 (the "Transaction").
The Company also obtained from the Québec Superior Court the approval of
an interim financing from Bermex of up to $3,000,000 to finance the operations
of the Company until the closing of the Transaction, in addition to the
existing credit facilities granted by Geosam Investments Limited.
The Transaction is an essential step towards the completion of Shermag's
restructuring efforts and the presentation of a plan of arrangement to its
creditors. The Transaction will also allow Shermag to preserve the existing
In the context of the Transaction, the Company also obtained an extension
of the stay of proceedings against Shermag and its subsidiaries (the
"Company") under the Companies' Creditors Arrangement Act (the "CCAA") until
October 16, 2009. Shermag has been operating under the protection of the CCAA
since May 5, 2008.
Shermag Inc., headquartered in Sherbrooke, Québec, designs, produces,
markets and distributes high-quality residential furniture. Shermag presently
has 227 active employees and is a manufacturer and importer with its
manufacturing operations and global sourcing division.
This news release contains forward-looking statements about the Company's
operations, objectives, strategies, financial situation and performance. These
statements are made based on assumptions and management's best estimates with
regard to future events. However, the business of the Company is subject to
risks and uncertainties that could cause actual results to differ from
expected results. Important factors that could cause such differences are
changes in pricing pressure being exerted by competitors, particularly
Asian-based companies, or significant movement in the Canadian/US dollar
exchange rate. This is not an exhaustive list. A broader evaluation of risk
factors that could affect future performance can be found in the Company's
Annual MD&A and Annual Information Form, filed with Canadian securities
regulatory authorities. Given these risks and uncertainties, investors should
not place undue reliance on forward-looking statements as a prediction of
actual results. The Company disclaims any intention or obligation to publicly
update or revise any forward-looking statements, whether as a result of new
information, future events or otherwise.
For further information:
For further information: Shermag Inc., (819) 566-1515