TORONTO, June 18 /CNW/ - Further to Rapid Brands Inc.'s (the "Company") (TSX-V: RAP) press release dated April 20, 2010, the Company announces that on June 17, 2010 it has closed its previously announced transaction with Block Capital Partners LLC (the "Buyer"), and Roger Block in connection with the sale to the Buyer of all of the issued and outstanding shares of the Company's wholly-owned operating subsidiary, Rapid Refill Corp. (the "Subsidiary") for US$1 million, subject to certain adjustments, plus the acceptance of approximately US$1 million of debt of the Subsidiary representing a total enterprise value of approximately US$2 million, (the "Transaction").
The Transaction was subject to shareholder approval, which was received at the Company's annual and special shareholder meeting (the "Meeting") held on June 15, 2010. At the Meeting, in addition to current directors Ronald Schmeichel and Kevin Taylor, Jordan Kupinsky was elected as a director of the Company to serve until the next annual meeting of shareholders.
As part of the closing of the Transaction, Roger Block resigned from the board as Vice-Chairman, Chief Executive Officer ("CEO") and Secretary of the Company, Ross Johnson resigned as Chief Financial Officer ("CFO") of the Company and Jason Block resigned as Chief Operating Officer of the Company. Ronald Schmeichel, a current director of the Company, has been appointed the new CEO and Secretary and Elena Masters has been appointed the CFO.
On closing, the Company received US$384,468.82 in cash which includes an amount equal to the accounts payable of the Company other than the accounts payable arising from the costs incurred by the Company relating to the Transaction and a secured promissory note in the principal amount of US$650,000.
The Company's main business after the Transaction will be identifying and evaluating assets or businesses with a view to completing a transaction. The net cash proceeds received at closing after deducting the costs relating to the Transaction will be utilized to identify and evaluate assets or businesses with a view to completing a transaction.
The Company's board has determined that it is in the best interests of the Company to be continued from British Columbia under the laws of Canada and to change its name to RAP Acquisition Corp. Following the Transaction, the Company intends to identify and evaluate assets or businesses with a view to completing a transaction. The change of name and continuance under the laws of Canada would provide the greatest jurisdictional flexibility and would make the Company more accessible for possible transactions in the future. Shareholder approval for the change of name and the continuance under the laws of Canada has been obtained at the Meeting.
Following the Transaction, the Company will remain a reporting issuer and the Company's listing will be transferred from the TSX Venture Exchange to NEX as the Company will no longer have an operating business.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
Forward Looking Statements
By their very nature, forward-looking statements involve inherent risks and uncertainties, both general and specific, which give rise to the possibility that predictions, forecasts, projections and other forward-looking statements will not be achieved. We caution you not to place undue reliance on these statements as a number of important factors could cause our actual results to differ materially from those expressed in such forward-looking statements. These statements are not a guarantee of future performance and are subject to risks and uncertainties that could cause actual results to differ materially including management of market, liquidity and funding and operational risks, the impact of changes in laws and enforcement thereof, the strength of the overall economy, our ability to manage costs and other variable operating expenses and other factors set forth in reports and other documents filed with the relevant Canadian securities regulatory authorities from time to time including our quarterly and annual management discussion and analysis. We caution that the foregoing list of factors that may affect future results is not exhaustive.
In addition, we have made assumptions in the preparation of this release including that the operating requirements of our current business will not materially change necessitating material change to our operating expense structure. The foregoing assumptions, although considered reasonable by us at the date of this release, could prove to be inaccurate and consequently our actual results could differ materially from expectations set out herein. This assumption covers significant areas, but is not comprehensive in scope. Please see previously issued documents to provide additional information and details as well as other potential risks.
SOURCE RAP Acquisition Corp.
For further information: For further information: Ronald D. Schmeichel, Director and CEO, Rapid Brands Inc., Tel: 416 972-6294, Email: firstname.lastname@example.org