Common Stock Listed
Toronto
Trading Symbol: AVP
VANCOUVER, Nov. 19, 2012 /PRNewswire/ - Avcorp Industries
Inc. (TSX: AVP) (the "Company" or "Avcorp") is pleased to report
that it has received the determination of an appointed arbitration
panel constituted to adjudicate outstanding issues relating to cost
reimbursements and compensation payable to Avcorp in connection
with the transition of Cessna Aircraft Company ("Cessna")
production work back to Cessna and other suppliers. The transition
of Cessna production work was first announced by the Company on
December 17, 2010 and immediately
following notification by Cessna, the Company had attempted to
negotiate compensation payments as contemplated by the Cessna
Strategic Alliance Agreement (the "SAA"). Only when negotiations
and mediation were unsuccessful did the Company refer the matter to
binding arbitration.
The binding arbitration award, delivered to the
Company on November 16, 2012,
determined that: the SAA was an exclusive agreement between Cessna
and Avcorp; Cessna could not unilaterally transition production
work from Avcorp; Avcorp had fulfilled the requirements of the SAA;
and, Avcorp suffered damages as a result of Cessna transitioning
production work from Avcorp. In addition, all counterclaims that
were advanced by Cessna were denied. The quantum of damages was
assessed by the arbitration panel at USD
27,391,372, which amount is payable to Avcorp within 30 days
of the arbitration award.
About Avcorp
Avcorp designs and builds major airframe structures for some of the
world's leading aircraft companies, including BAE Systems, Boeing,
and Bombardier. With more than 50 years of experience, over 400
skilled employees and 354,000 square feet of facilities in
Delta BC and Burlington ON, Avcorp
offers integrated composite and metallic aircraft structures to
aircraft manufacturers, a distinct advantage in the pursuit of
contracts for new aircraft designs, which require lower‐cost, light
weight, strong, reliable structures. Our Burlington location also offers composite
repairs for commercial aircraft. Avcorp is a Canadian public
company traded on the Toronto Stock Exchange (TSX:AVP).
(signed)
MARK VAN
ROOIJ
PRESIDENT and CHIEF EXECUTIVE OFFICER
Forward-Looking Statements
This management discussion and analysis should
be read in conjunction with the Company's audited financial
statements. Certain statements in this report and other oral
and written statements made by the Company from time to time are
forward-looking statements, including those that discuss
strategies, goals, outlook or other non-historical matters; or
projected revenues, income, returns or other financial
measures. These forward-looking statements are subject to
risks and uncertainties that may cause actual results to differ
materially from those contained in the statements, including the
following: (a) the ability of the Company to renegotiate its
debt agreements under which it is in default; (b) the extent to
which the Company is able to achieve savings from its restructuring
plans; (c) uncertainty in estimating the amount and timing of
restructuring charges and related costs; (d) changes in worldwide
economic and political conditions that impact interest and foreign
exchange rates; (e) the occurrence of work stoppages and
strikes at key facilities of the Company or the Company's customers
or suppliers; (f) government funding and program approvals
affecting products being developed or sold under government
programs; (g) cost and delivery performance under various program
and development contracts; (h) the adequacy of cost estimates
for various customer care programs including servicing warranties;
(i) the ability to control costs and successful implementation of
various cost reduction programs; (j) the timing of certifications
of new aircraft products; (k) the occurrence of further downturns
in customer markets to which the Company products are sold or
supplied or where the Company offers financing; (l) changes in
aircraft delivery schedules or cancellation of orders; (m) the
Company's ability to offset, through cost reductions, raw material
price increases and pricing pressure brought by original equipment
manufacturer customers; (n) the availability and cost of insurance;
(o) the Company's ability to maintain portfolio credit quality; (p)
the Company's access to debt financing at competitive rates; and
(q) uncertainty in estimating contingent liabilities and
establishing reserves tailored to address such contingencies.
SOURCE Avcorp Industries Inc.