ARISE Announces Execution of Letter of Intent in Respect of Bridge Loan and Business Combination and Closes First Tranche of up to $1,500,000 Bridge Loan (cnw)

WATERLOO, ON, Oct. 18, 2011 /CNW/ - ARISE Technologies Corporation (TSX: APV and Frankfurt: A3T) ("ARISE" or the "Company"), which is a leader in high-performance, high-quality, cost-effective solar technology, today announced that the Company has entered into a non-binding letter of intent with Radiant Offshore Fund Ltd ("Radiant") with respect to (i) the provision by Radiant of bridge loan financing for the support of the Company's Canadian operations in the amount of up to $1.5 million to be provided in three tranches ("Bridge Loan") and (ii) a business combination between ARISE and a currently unnamed third party which would combine the ongoing Canadian operations of ARISE with the operations of the unnamed party.

The first tranche of the Bridge Loan, in the amount of $150,000 has now been advanced to ARISE. A second tranche of $200,000 is scheduled to be advanced today subject to the satisfaction of certain conditions, including the execution of additional security documentation and the entering into of a subordination agreement by one of ARISE's current lenders. The purpose of the Bridge Loan is to provide working capital bridge financing to Canadian operations of the Company. Each tranche of the Bridge Loan matures six months after its advance subject to acceleration in certain events, including if a business combination agreement is not executed by ARISE by October 25, 2011. The Bridge Loan bears interest at a rate of 12.0% per annum. Advancement of the final $1.15 million tranche of the Bridge Loan is subject to certain conditions including the execution of a business combination agreement.

ARISE and the unnamed third party are currently conducting due diligence in respect of each others operations to establish the relative values of the entities for the purpose of the proposed business combination.

Any business combination is expected to require and will be conditional upon approval from the shareholders of ARISE to be obtained at a yet to be scheduled special meeting as well as various regulatory consent requirements including certain requirements of the Toronto Stock Exchange.

In addition, the Company announces that it and Haverstock Master Fund, Ltd. have entered into an amending agreement in respect of the share purchase warrants previously issued to Haverstock in May 2011 and July 2011. In consideration for Haverstock agreeing to extend the maturity of its bridge loan to the Company from September 30 to November 30 and to subordinate its security position in the Company's assets in certain circumstances, the Company has agreed to reduce the exercise price of the 1,500,000 share purchase warrants issued to Haverstock in 2011 to $0.05. The share purchase warrants originally were exercisable at between $0.21 and $0.10. In addition, the amount due under the Haverstock bridge loan was increased by $25,000.

About Radiant

Radiant Investment Management Ltd. (RIML) is an event-driven hedge fund that employs a variety of strategies to generate alpha returns for its investors. RIML made their first investment in Arise Technologies in June 2010 and continues to be supportive of management and their direction. RIML's head office is located in Toronto, Canada and RIML has onshore and offshore funds.

About Haverstock

Haverstock is an institutional investor with an investment objective to seek capital appreciation through the general strategy of investing in public securities of U.S. and non-U.S. companies, through direct equity purchases from such companies. The portfolio manager of Haverstock, David Ratzker, has structured more than US$300 million worth of private equity investments in publicly traded corporations in a variety of sectors including energy, cleantech, telecommunications, consumer, and education.