RS Technologies Provides Operational Update

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CALGARY, Oct. 12 /CNW/ - RS Technologies Inc. ("RS") (RS - TSX), a technology innovator and manufacturer of advanced composite products for infrastructure markets, today provided the following operational update: 

• RS has received the requisite approval of the holders of its $10 million principal amount of 15 percent secured redeemable convertible debentures due December 17, 2013 (the "Debentures") to accelerate the maturity date of the Debentures to October 20, 2010. RS intends to satisfy its obligation to repay the entire $10 million principal amount of the Debentures and accrued and unpaid interest thereon by issuing and delivering to the holders of the Debentures on October 20, 2010 common shares of RS. The number of common shares issued will be determined by dividing such principal amount of the Debentures and accrued and unpaid interest thereon by 85 percent of the volume weighted average trading price per common share of RS for the five consecutive trading days ending on October 13, 2010.
• The directors of RS have advanced an aggregate of $900,000 to RS in order that RS may continue as a going concern until the end of October 2010 by which time RS plans to have secured additional funding to continue as a going concern to the end of 2010.
• RS has undertaken cost reduction measures, including staff reductions at its Calgary, Alberta office and plant locations and its Tilbury, Ontario manufacturing facility. In addition, RS will operate its production cells at a reduced capacity so as to both accelerate cost reduction initiatives relating to manufacturing equipment and processes and monetize existing inventories. RS has largely eliminated its commitments to external consultants and continues to explore other avenues for general and administrative cost savings.

The securities offered have not been and will not be registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act"), and may not be offered or sold within the United States or to, or for the account or benefit of, U.S. persons except in certain transactions exempt from the registration requirements of the U.S. Securities Act.

About RS

RS is an ISO 9001:2008 certified technology innovator that develops advanced composite material products for infrastructure markets. The composite products manufactured using the company's proprietary resins and processes are typically lighter, more durable and longer-lasting than competing products made from the traditional building blocks of wood, steel or concrete. RS's flagship product is its award-winning RStandard® composite pole. The pole is used as transmission and distribution poles to carry electric grids and as communication structures for various uses including wireless networks and microwave communications systems.

For the latest on RS's developments, go to the company's website at www.grouprsi.com.

"RStandard" is a registered trademark of RS.

Certain information set forth in this news release, including management's assessment of RS's future plans and operations and the issuance of common shares of RS on October 20, 2010 to satisfy all of the principal amount of the Debentures and accrued and unpaid interest thereon, contains forward-looking statements which are based on RS's current internal expectations, estimates, projections, assumptions and beliefs, which may prove to be incorrect. Some of the forward-looking statements may be identified by words such as "expects", "anticipates", "believes", "projects", "plans" and similar expressions. These statements are not guarantees of future performance and undue reliance should not be placed on them. Such forward-looking statements necessarily involve known and unknown risks and uncertainties, which may cause RS's actual performance and financial results in future periods to differ materially from any projections of future performance or results expressed or implied by such forward-looking statements. These risks and uncertainties include, among other things, RS not securing additional funds for its working capital needs to continue as a going concern past the end of October 2010,  RS's lack of revenues and unpredictability of future revenues; the uncertainty of the profitability of existing and contemplated products of RS; RS's ability to raise capital on acceptable terms when needed; RS's ability to attract and retain key employees; competition from established competitors with greater resources; the uncertainty of the developing markets in which RS operates; the risks associated with rapidly changing technology; RS's reliance on third parties to supply raw materials and the cost of such raw materials; intellectual property risks, foreign exchange rate fluctuations and changes in general economic, market and business conditions. Many of these risks and uncertainties are described in RS's annual information form for the year ended December 31, 2009 and other documents RS files with the Canadian securities authorities. The forward-looking statements are made as of the date hereof and RS assumes no obligation to update or revise such statements to reflect new events or circumstances except as required by applicable securities laws.

For further information:

RS Technologies Inc.
Laurien Abel, Investor Relations and Communications
Tel: [phone] Fax: [phone]
Email: [email protected]