Arbutus Distributors Ltd.: News Release

Marketwired

VANCOUVER, BRITISH COLUMBIA--(Marketwired - Jul 5, 2013) - Arbutus Distributors Ltd. (the "Offeror") announces that it acquired (the "Acquisition") CDN$580,000 principal amount of 10% second lien convertible debentures (the "Debentures") of Tree Island Steel Ltd. ("Tree Island"). These Debentures represent 3.14% of the outstanding Debentures of Tree Island.

The Offeror acquired the Debentures at a price of CDN$122 per Debenture. The principal amount of each Debenture is convertible into Common Shares of Tree Island at a conversion price of $0.50 per Common Share, being a conversion rate of 200 Common Shares for each CDN$100 principal amount of Debenture so converted. The additional Debentures purchased by the acquirer are convertible into 1,160,000 Common shares of Tree Island (the "Common Shares"), subject to anti-dilution adjustments.

The Offeror continues to maintain ownership and control of its previously acquired CDN$4,014,400 principal amount of the Debentures. These Debentures are convertible into 8,028,800 Common Shares of Tree Island, subject to anti-dilution adjustments. After giving effect to the Acquisition, the Offeror would own or control CDN$4,594,400 principal amount of the Debentures. These Debentures represent 24.85% of the outstanding Debentures of Tree Island.

As of July 5, 2013, the Offeror has ownership of 311,000 common shares of Tree Island. In addition, the warrants previously issued to the Offeror are exercisable into 1,125,000 Common Shares of Tree Island (the "Warrants"). After giving effect to the Acquisition and to the conversion of all Debentures and exercise of all Warrants, assuming that no other securityholder converts its convertible securities, the Offeror would own or control 10,624,800 Common Shares, representing approximately 31.36% of the 33,879,950 Common Shares of Tree Island that would then be outstanding on a fully diluted basis.

The securities in Tree Island are held by the Offeror for investment purposes. The Offeror may increase or decrease its ownership position in the future.

Contact:
Arbutus Distributors Ltd.
604-682-2911
604-682-2729

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