TSX VENTURE : FCT
NGSTON, ON, Feb. 1 /CNW Telbec/ - Fuel Cell Technologies Corporation
("FCT"), today announced the signing of an agreement with Madison Pacific
Properties Inc. ("Madison") under which FCTC will reorganize its business and
receive from Madison an investment of $1,550,000. The reorganization will take
place by way of a statutory arrangement. FCT currently has 48,940,000 issued
and outstanding Common Shares.
Madison, a Vancouver-based, TSX listed, real estate company (TSX:MPC),
has provided FCT with a non-refundable deposit of $200,000, and has also
established an interim, secured, demand credit facility (the "Facility") for
FCT, to a maximum of $300,000. The deposit amounts and any amounts borrowed by
FCT from Madison will be applied to the Madison investment.
Under the arrangement, FCT will consolidate its Common Shares on a 10 to
1 basis. FCT will then reorganize its capital into non-voting, participating,
Class A Shares, voting, participating, Class B Shares, and non-voting, fixed
price, redeemable, non-participating, Preferred Shares. Each Common Share of
FCT will be exchanged for one Class A Share, one Class B Share and one
Preferred Share.
Madison will invest $1,550,000 inclusive of any amounts advanced under
the Facility in FCT in exchange for the issuance of 72,602,667 Class A Shares
and 3,200,000 Class B Shares.
FCT's operating subsidiary, Fuel Cell Technologies Ltd. ("FCTL") will
sell all of its assets and business, including the advance of Madison's
investment, to a new subsidiary of FCTL, named FCT Opco Inc. ("Opco"), in
exchange for assumption of specified liabilities.
All of the issued and outstanding Preferred Shares of FCT will be
exchanged for voting, participating, Common Shares of Opco, on a
share-for-share basis.
Following the consolidation of FCT Common Shares, for each Common Share
of FCT held, a shareholder will hold one non-voting, participating, Class A
Share and one voting, participating, Class B Share of FCT, and one voting,
participating Common Share of Opco. Opco will change its name to the name of
FCTL and will hold all of the operating assets and business of FCTL, and the
net proceeds of the investment made by Madison in FCT will be used by Opco to
continue the solid oxide fuel cell system business acquired from FCTL. Upon
the completion o the arrangement, Opco will not be a reporting issuer.
FCT will change its name to MPP Properties Inc., appoint new management
and, subject to the satisfaction of all applicable regulatory requirements,
intends to qualify as a real estate issuer, and list for trading its Class A
Shares and Class B Shares on the TSX Venture Exchange. After the arrangement,
former FCT shareholders will hold approximately 11.4% of the equity of MPP
Properties Inc., with the remaining equity being held by Madison.
Following the arrangement, MPP Properties Inc. is expected to acquire a
portfolio of commercial and industrial real estate assets in exchange for the
issuance of Class A Shares of FCT.
Over the past decade, FCT has designed and built custom fuel cell power
systems. Fuel cell systems are the future of power generation because of their
environmental benefits and high efficiency. FCT's 5kW SOFC systems are
designed to operate on a variety of readily available fuels and provide a
highly efficient, environmentally friendly method to produce on-site
electricity and heat that can be used in a variety of remote, commercial,
industrial and residential applications.
The completion of the arrangement and reorganization described above will
be subject to a number of conditions, including the approval of an interim
order by the Ontario court for the manner of disclosure and notice to FCT
shareholders, the receipt of approval of the securityholders of FCT by special
resolution at a Special Meeting of Shareholders, the final approval of the
Ontario court, and the approval of TSX Venture Exchange.
THERE CAN BE NO ASSURANCE THAT THE ARRANGEMENT AND REORGANIZATION
DESCRIBED ABOVE WILL BE COMPLETED AS PROPOSED, OR AT ALL. INVESTORS ARE
CAUTIONED THAT, EXCEPT AS DISCLOSED IN THE MANAGEMENT INFORMATION CIRCULAR TO
BE PREPARED AND SENT TO FCT SHAREHOLDERS IN CONNECTION WITH THE ARRANGEMENT,
ANY INFORMATION RELEASED OR RECEIVED REGARDING THE ARRANGEMENT MAY NOT BE
ACCURATE OR COMPLETE AND SHOULD NOT BE RELIED ON. TRADING IN THE SHARES OF FCT
SHOULD BE CONSIDERED HIGHLY SPECULATIVE.
THE TSX VENTURE EXCHANGE HAS IN NO WAY PASSED UPON THE MERITS OF THE
PROPOSED ARRANGEMENT OR RELATED TRANSACTIONS, AND HAS NEITHER APPROVED
NOR DISAPPROVED THE CONTENTS OF THIS PRESS RELEASE.
