2008-06-13 23:14:26 -

- Sitrick And Company Anita-Marie Laurie or Maya Pogoda, 310-788-2850 Meridian Technologies Inc., the automotive industry's largest supplier of magnesium die casting assemblies, today announced that it has reached a restructuring agreement with its lenders. Under the terms of the agreement, a newly reorganized company is being created with a recapitalized balance sheet and significantly lower debt burden.

The

Company's secured lenders, led by GE Commercial Finance as agent, have agreed to provide the newly reorganized company with $55 million in new financing, consisting of a $30 million revolving credit facility and a $25 million term loan upon closing. In addition to the new financing, the Company's secured lenders will exchange a significant portion of the existing debt for all of the equity in the newly reorganized company that is being created by this transaction. The result will be a new Meridian Lightweight Technologies with a significantly deleveraged balance sheet, and sufficient liquidity to support its operations and execute its strategic plan to return to profitability.

"This agreement is excellent news for our company, our employees and our suppliers and customers worldwide because it means that the cloud of uncertainty that has created doubts about our long-term viability has been swept away," said Chief Restructuring Officer Robert M. Caruso. "We are extremely pleased that going forward we will have the support of an owner with resources necessary to successfully operate our business."

To effectuate the transaction, today the Company filed an application for creditor protection under the Companies' Creditors Arrangement Act (CCAA) in the Ontario Superior Court of Justice along with a Plan of Arrangement (the "Plan") that has the support of the court Monitor and substantially all of the Company's key constituents, including the Company's major customers. The application includes only Meridian's Canadian and UK operations.

To fund operations during the CCAA process, the secured lenders have arranged $20 million in interim financing. Once sanctioned by the Court, the Plan will effectively transfer ownership of the Company's assets, including the equity of the Company's subsidiaries, to the new Meridian Lightweight Technologies. Since the CCAA proceeding is only necessary to effectuate the restructuring, all of the Company's facilities around the world will continue to operate on their normal daily schedules, employees will be paid normally and suppliers will continue to be paid in the ordinary course.

"We are seeking to have the Plan approved and sanctioned by the court very quickly. Because of the new financing and expedited timeframe of the CCAA proceedings, we do not expect that our suppliers, customers or employees will notice any difference in our daily operations while we use the CCAA process to implement this transaction," Mr. Caruso said.

The Company does not intend to commence a Chapter 11 case in the United States or a similar insolvency proceeding anywhere else in the world.

The Company has developed, and is in the process of implementing, a long-term strategic plan to strengthen the company operationally, including reducing its cost structure and opening a new manufacturing facility in Mexico by year end. Additionally, the Company will continue with its commitment to provide customers the high quality light weight solutions they rely on.

"This transaction, including the new capital and reduced debt level that will result from it, is the last step necessary to position the new Meridian Lightweight Technologies to overcome the current industry conditions that have hampered our ability to achieve sustainable profitability, including increasing magnesium costs, declining OEM production volumes and a weakened U.S. dollar," concluded Mr. Caruso.

About Meridian

Meridian Technologies Inc. is the largest supplier of lightweight magnesium castings in the world serving most of the Global automotive manufacturers in three continents with more than 1,200 dedicated employees. Meridian lightweight applications allow vehicle buyers to save an estimated 17 million liters of fuel annually and reduce emissions by 55,000 metric tons of carbon dioxide per year. For more than 25 years, Meridian has been aggressively seeking new and progressive ways to raise the bar on magnesium die casting design and manufacturing securing its position as the leader in the industry.

Files CCAA to Implement New Capital Structure

Daily Operations to Continue Normally Worldwide During Brief CCAA
Process