MPL COMMUNICATIONS INC.

MPL COMMUNICATIONS INC.

February 11, 2011 22:05 ET

MPL Communications Inc.: Update on Court-Ordered Payment in Minority Shareholder Action

TORONTO, ONTARIO--(Marketwire - Feb. 11, 2011) - On Nov. 25, 2010, MPL Communications Inc. was informed that a court order had been entered in the Alberta Court of Queen's Bench Judgment Roll on November 18, 2010. The order set aside an agreement previously approved by the MPL board with regard to the payment of the amounts owed by Marpep Publishing Limited.

In its place the court ordered that Stephen Pepper and Barrie Martland would be jointly and severally responsible together with Marpep for the original judgment amount plus interest originally awarded to MPL from Marpep.

Further, the court ordered that 5,745,556 MPL shares owned by Marpep, 1,729,250 MPL shares owned by Mr. Pepper and 1,086,250 MPL shares owned by Mr. Martland be sold with the proceeds to be paid to MPL in reduction of the judgment award. The sale is to be conducted by sealed bid with bids for cash and with a set closing date. Counsels are to agree on an appropriate process.

If, after the sale of the shares, there were a deficiency owing in the amount of the judgment award, the matter would be addressed by the MPL board. However, payment of the judgment will remain under supervision of the court.

The court also ordered that no retiring allowance be paid or negotiated by the MPL Board for either Mr. Pepper or Mr. Martland without independent expert input.

On Dec. 15, 2010, MPL, Marpep and Messrs. Martland and Pepper filed an appeal in the Court of Appeal of Alberta in which they have appealed parts of the original Court of Queen's Bench judgment originally pronounced Sept. 17, 2010, and entered Nov. 18, 2010.

Specifically, the appellants claim that the trial judge erred in rejecting a payment proposal by Marpep which the MPL board had accepted on May 27, 2010; that joint and several liabilities should not have been imposed on Messrs. Martland and Pepper; that ordering the sale of MPL stock owned by Messrs. Martland and Pepper in their registered retirement funds violated protection from judgment creditors; and the court erred in invalidating the severance clauses in MPL's employment contracts with Messrs. Martland and Pepper.

Contact Information

  • MPL Communications Inc.
    Stephen D. Pepper
    Chairman
    (416) 869-1177
    spepper@mplcomm.com
    or
    MPL Communications Inc.
    133 Richmond St. West
    Toronto, ON
    M5H 3M8