VANCOUVER, BRITISH COLUMBIA--(Marketwire - July 19, 2012) - Functional Technologies Corp. (TSX VENTURE:FEB)(OTCQX:FEBTF) (the "Company") reports the signing of the agreements relating to the Company's sale of non-core assets and technologies through the sale of its subsidiaries, Phyterra Bio Inc. ("PBI") and Maritime Pulse Drying Inc. ("MPD"), as well as certain assets of Phyterra Yeast Inc., to a company owned by Garth Greenham and Michael Horne, who resigned from their positions as executive officers and directors of the Company and its subsidiaries effective June 30, 2012. The primary assets included in this transaction are related to equipment, property and leaseholds associated with a yeast and microorganism production facility which are no longer core to the Company's execution strategy.
Existing and planned partnerships with yeast and micro-organism producers allow the Company to further its corporate objectives without the large capital costs, operational overhead and dilution of management bandwidth required to complete the setup of a production facility.
The sale transactions will close in two stages, the first to be held following receipt of requisite consents and releases as well as receipt of TSX Venture Exchange approval, and the second to be held on October 31, 2012. In consideration, the purchaser will, provided that both closings occur, assume financial obligations totaling approximately $3.1 million and will issue to the Company a royalty note in the amount of $1.0 million securing the payment of a royalty over future revenues of PBI and MPD. The Company has agreed to make support payments amounting to a long term unsecured note to the purchaser in the maximum aggregate amount of $1.2 million, which may be used solely for the purpose of supporting and developing the business, assets and operations of PBI and MPD.
Upon completion of this transaction, the Company will have completed its objective of streamlining its research and development group, senior management team and core strategic commercial objectives while significantly improving its balance sheet and reducing its operating overhead by approximately 60%.
About Functional Technologies Corp.
Functional Technologies develops and commercializes proprietary, advanced yeast-based solutions to significant challenges in the food, beverage and healthcare industries. The Company's platform improves the performance of innate yeast functions, and prevents the formation of naturally occurring toxins and contaminants that either affect final product quality or are classified by the World Health Organization as probable human carcinogens. Functional Technologies' lead technologies include yeasts that prevent and reduce the formation of the foul-smelling hydrogen sulphide (H2S) and the carcinogens acrylamide and ethyl carbamate (more commonly known as urethane), by-products of food and beverage processing. These contaminants are found in many commonly consumed items, such as fermented food products and alcoholic beverages, and baked and fried foods. For more information, please visit our website at www.functionaltechcorp.com.
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.