CCAAUNIQUE BROADBAND SYSTEMS, INC. COMMENCES CCAA PROCEEDINGS AND FILES NOTICE OF APPEAL OF SUMMARY JUDGMENT MOTIONS
TORONTO, July 5, 2011 /CNW/ - Unique Broadband Systems, Inc. ("UBS" or the "Company") (TSX Venture: UBS) announced today that it and its wholly ownedsubsidiary UBS Wireless Systems Inc. have commenced proceedings underthe Companies' Creditors Arrangement Act (the "CCAA") and that the court has made an order staying all proceedings againstthe Company and its directors until August 5, 2011. RSM Richter Inc.(the "Monitor") has been appointed as monitor to oversee the Company's business andcash flow. Further information with respect to the CCAA proceedingscan be found on the Monitor's website at www.rsmrchter.com.
The Company has been successful over the past year in significantlyreducing operating expenses, settling certain claims and obtaining thereversal of approximately $1.8 million of awards granted by theCompany's prior board in 2009. Notwithstanding these achievements, theapproximately $16.7 million in termination and other payments beingpursued in claims against UBS involving, among others, JolianInvestments Limited ("Jolian"), Gerald McGoey, DOL Technologies Inc. ("DOL") and Alex Dolgonos (collectively the "Plaintiff Group") have precipitated the commencement of proceedings under the CCAA,which the Company views as the best course of action to preserve itsassets.
The CCAA proceeding has been commenced to, among other things:
(a) facilitate the determination and compromise or arrangement ofcreditor claims against UBS;
(b) to permit the company to propose a plan to realize value fromthe company's accumulated tax losses and public listing;
(c) avert a imminent liquidity crisis being caused bylitigation-related expenses that will prevent UBS from continuing tocarry on business for the benefit of its stakeholders and defending theproceedings brought by the Plaintiff Group;
(d) stay all payables owing by UBS, including the requirement tofund the litigation costs of both Jolian and DOL as recently ordered bythe court: and
(c) provide a process to determine the claims being asserted against UBSby the Plaintiff Group in a more cost effective and expeditious manner.
While under protection from its creditors, the Company's board ofdirectors will continue to manage the Company. In addition, UBS willcontinue to provide certain services to LOOK Communications Inc.pursuant to the management services agreement between the parties.
UBS also announced that, in connection with the claims and counterclaimsinvolving, among others, the Plaintiff Group, the Company has appealedthe decision of the court in connection with motions for summaryjudgment brought by UBS and the Plaintiff Group relating to theindemnification of the Plaintiff Group's legal expenses described inthe Company's press release dated May 31, 2011.
About Unique Broadband Systems, Inc.
UBS's shares are listed on the TSX Venture Exchange under the symbols"UBS". More information on UBS can be found at www.sedar.com.
The corporate information contained in this release includesforward-looking statements regarding future events and costs thatinvolve risks and uncertainties that could cause actual results todiffer materially. Assumptions used in the preparation of suchinformation, although considered reasonable by UBS at the time ofpreparation, may prove to be incorrect. The actual results achieved mayvary from the information provided herein and the variations may bematerial. Consequently, there is no representation by UBS that actualresults achieved will be the same in whole or in part as thoseforecast.
Neither the 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.