ST. JOHN'S, NL, March 7 /CNW/ - Rutter Inc. (TSX: RUT). Rutter Inc.
wishes to provide an update on the sale of its DORIS Engineering SA (DORIS)
shares and its strategy for addressing the Company's immediate and long-term
working capital requirements.
"The pending sale of our DORIS shares is expected to yield considerably
more than the $8.1 million we paid for them and will more than address the
capital requirements of Rutter at its current size," said Donald I. Clarke,
Chairman and CEO of Rutter Inc. "Rutter has commissioned an independent
valuation of DORIS and I am pleased to report that other DORIS shareholders
have expressed their written interest in exercising their first right of
refusal to purchasing our shares. We are confident that we will be able to
reach agreement on price and conclude the sale within the earlier announced
June 30, 2007 time frame."
In the interim, to address immediate working capital requirements,
Rutter Inc. has been successful in arranging an unsecured bridging loan for
$2 million (details provided below) from certain of its directors and
long-term shareholders. Rutter Inc. has also received approval from its
debenture holders to further defer December interest payments previously
deferred to February 28, 2007 until June 30, 2007.
"Rutter will use the proceeds of the DORIS transaction to permanently pay
out the balance of its $9 million operating line with its current lender and
any deferred interest payments. The remainder will be used for working capital
and retirement of short term debt," said Clarke. "This action will greatly
improve financial ratios and strengthen Rutter's balance sheet considerably.
Our Technologies segment is performing well and we are doing the right things
to ensure Engineering Services returns to profitability in the near term. With
an improved balance sheet and a focus on profitability, we have every
confidence that Rutter will be able to recapitalize and resume its plans for
growth and expansion," he concluded.
The $2 Million Bridging Loan -The term of the $2.0 million loan, which is
subject to the necessary approvals, is for the lesser of 12 months or the
closing of the sale of the DORIS shares. The loan carries an annual interest
rate of 10% with a 5% discount. Loan participants will also receive a total of
600,000 warrants, each exercisable to acquire one common share of Rutter for a
period of 18 months at a price of $0.65 per share.
About Rutter Inc. - Represented worldwide, Rutter Inc. is a global
enterprise focused on providing innovative, 21st century technologies and
engineering solutions that improve the efficiency and safety of marine,
transportation and operations in other industrial sectors. Key activities of
the enterprise include product development and marketing, technology
manufacturing 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: Paul Snow, Director of Communications &
Investor Relations, (709) 368-3174