ST. JOHN'S, March 20 /CNW/ - March 20, 2008 /CNW/ - Rutter Inc.
(TSX: RUT) announced today that it has reached an agreement with its senior
lender to amend the terms of Rutter's long term debentures. Rutter currently
has a debenture in the principal amount of $15 million at 12% interest
maturing in December 2008, and a debenture in the principal amount of $25
million at interest rates varying up to 16% which matures December 2012.
In commenting on the agreement, Donald I. Clarke, Chairman and CEO said,
"I am very pleased that we were able to strengthen Rutter's future. These
amendments demonstrate the lender's confidence in Rutter as we work toward
achieving the financial performance in our business units that we are very
confident we can reach over the coming months for the benefit of all
Included under the agreement announced today are: (i) the suspension of
certain borrowing covenants until the end of February 2009 at which time
Rutter's performance is expected to align with the covenant requirements. The
Company has previously disclosed default of these covenants in its August 31,
2007 and subsequent financial statements; (ii) a one time fee of $600,000;
(iii) the granting of 6 million warrants to the lender at an exercise price of
$0.28, expiring December 6, 2012. Rutter may, under certain circumstances
after the warrants are issued, reduce the number of warrants available;
(iv) an interest surcharge of 2% effective March 1, 2008 payable as long as
the Company is not in compliance with its original borrowing covenants (v) the
repayment of the $15 million debenture on November 30, 2008, one month earlier
than currently scheduled; and (vi) an agreement to repay $5 million of the
$25 million debenture on November 30, 2008. The remaining principal balance
will be due for repayment in accordance with the original debenture agreement.
In addition, Rutter has the right, in certain circumstances, to make lump sum
payments on the debentures.
The terms of the amendment are subject to Rutter receiving the necessary
regulatory approvals including the approval of the TSX.
About Rutter Inc. - Rutter Inc. is a global enterprise focused on
providing innovative, 21st century technologies and engineering solutions that
improve the efficiency and safety of operating assets in marine,
transportation, oil and gas and other industrial sectors. Key activities of
the enterprise include technology development and marketing, outsource
manufacturing of electronics and electronic subassemblies and automation and
control systems engineering. For more information see www.rutter.ca.
This press release may contain forward-looking statements that involve
risks and uncertainties. These forward-looking statements reflect our current
expectations and are subject to a number of risks and uncertainties including,
but not limited to, change in technology and general market conditions. Due to
the many risks and uncertainties, Rutter Inc. cannot assure that
forward-looking statements that may be contained in this press release will be
The TSX has not reviewed and does not accept responsibility for the
adequacy or accuracy of this release.
For further information:
For further information: Karen M. Snook, Chief Financial Officer, Rutter
Inc., (709) 368-3174; Dan Herder, Corporate Secretary, Rutter Inc., (709)