CRAiLAR Technologies Inc. announces additional commitments of up to $3 million of secured convertible debentures

CRAiLAR Technologies Inc. announces additional commitments of up to $3 million
                      of secured convertible debentures

PR Newswire

VICTORIA, BC and PORTLAND, OR, Feb. 12, 2013

VICTORIA,  BC  and  PORTLAND,  OR,  Feb.  12,  2013  /PRNewswire/  -   CRAiLAR 
Technologies Inc. (TSXV: CL) (OTCBB: CRLRF) ("CL" or the "Company") is pleased
to  announce  that  it  has  received  commitments  from  a  small  group   of 
institutions to  raise  an aggregate  of  not less  than  $3.0 million,  on  a 
non-brokered deal basis, by way of a private placement offering of up to  $5.0 
million 10.0% secured subordinated  convertible debentures (the  "Debentures") 
of the Company at a price of $1,000 per Debenture (the "Offering").

"This funding is an important step in  the growth strategy for the Company  as 
we apply to move to a senior U.S. exchange platform," said Ken Barker, CEO  of 
CRAiLAR. "The assurance that this private investor confidence provides to the
public market, while we  simultaneously prepare to  deliver finished fiber  at 
increased capacities  from our  Pamplico,  S.C. manufacturing  facility,  puts 
CRAiLAR in an ideal position for  introduction on a more visible and  globally 
accessible platform."

The Offering is intended to be completed on essentially the same terms as  the 
offering previously announced by the Company on August 23, 2012 (the "Previous
Private Placement"). Under the Previous Private Placement, the Company  sought 
to raise  an aggregate  of $18.0  million and  closed on  approximately  $12.5 
million of debentures  and equity units.  The Offering at  minimum $3  million 
will  substantially  complete  the  funding  goal  of  the  Previous   Private 
Placement. The Offering is expected to close on or about February 19, 2013.

Terms of Financing

The Debentures will  mature on September  30, 2017 (the  "Maturity Date")  and 
will accrue interest  at a rate  of 10.0% per  annum payable semi-annually  in 
arrears on March 31^st and September  30^th in each year commencing  September 
30^th, 2013. The September 30^th, 2013 interest payment will represent accrued
interest for  the period  from the  Closing Date  (as defined  below). At  the 
holder's option, the  Debentures may be  converted into common  shares in  the 
capital of the Company (each a "Share") at  any time up to the earlier of  the 
Maturity Date and the business day immediately preceding the date specified by
the Company for redemption of the Debentures. The conversion price, subject to
adjustment in certain circumstances, will be $2.90 per Share (the  "Conversion 
Price"), being  a conversion  rate of  approximately 344.828  Shares for  each 
$1,000 principal amount of Debentures.

The Debentures will  be direct obligations  of the Company.  Crailar Inc.,  a 
wholly-owned U.S. subsidiary  of the  Company ("Crailar US"),  will provide  a 
limited guarantee of the obligations of the Company under the Debentures and a
security interest  over  certain  assets  of  Crailar  US  having  an  initial 
acquisition cost of  approximately $5.5 million  (the "Secured Assets").  The 
security granted in  respect of  the Debentures  will be  subordinated to  the 
security granted in  respect of the  Company's secured convertible  debentures 
issued on September 20, 2012 and will  be limited to the Secured Assets.  The 
Debentures will otherwise rank  subordinate in right  of payment of  principal 
and interest to all present and  future senior obligations of the Company  and 
rank equally to all present and future unsecured indebtedness of the Company.

The Debentures will not be redeemable  before September 30, 2015. On or  after 
September 30, 2015,  and prior to  Maturity, the Company  may, at its  option, 
subject to providing not more than 60 and not less than 30 days' prior notice,
redeem the Debentures, in whole  or, from time to time,  in part, at par  plus 
accrued and unpaid interest provided that the volume weighted average  trading 
price of the common  shares of the  Company on the  TSX Venture Exchange  (the 
"Exchange") during the 20  consecutive trading days  ending five trading  days 
preceding the date on which the notice of redemption is given is not less than
125% of the Conversion Price.

The Debentures contain a change of control provision, whereby upon a change of
control, as set forth in  the Debentures, the Company  shall make an offer  in 
writing to  the  holders of  the  Debentures  to, at  the  Debenture  holder's 
election, either (i) purchase the Debentures  at 100% of the principal  amount 
thereof plus accrued and  unpaid interest, or (ii)  convert the Debentures  at 
the change of control conversion price,  which is a declining discount to  the 
Conversion Price the closer the change of control occurs to the Maturity Date.

The Offering is scheduled to close on or about February 19, 2013 (the "Closing
Date") and is subject to certain conditions including, but not limited to, the
receipt of all necessary approvals, including the approval of the Exchange.

It is anticipated that the Company will  pay cash finders' fees equal to  7.0% 
of the gross proceeds of the Offering.

The net proceeds of the  Offering will be used  to fund the Company's  capital 
program and for general corporate purposes.

The Debentures  have not  been and  will not  be registered  under the  United 
States Securities Act of 1933, as amended (the "U.S. Securities Act"), and may
not be offered or sold in the United States absent registration or  applicable 
exemption from the  registration requirements.  This press  release shall  not 
constitute an offer to sell or the  solicitation of an offer to buy nor  shall 
there be any sale of the Debentures  in any jurisdiction in which such  offer, 
solicitation or sale would be unlawful. Any public offering of the  Debentures 
to be  made in  the  United States  must  be made  by  means of  a  prospectus 
containing detailed information about the  Company and management, as well  as 
financial statements.

The Debentures to be issued by the Company will be "restricted securities"  as 
defined under Rule 144(a)(3) of the  U.S. Securities Act and will contain  the 
appropriate restrictive legends  as required  under the  U.S. Securities  Act, 
National Instrument 45-102 and as required by the Exchange.

Neither the Exchange  nor its Regulation  Services Provider (as  that term  is 
defined in  the  policies of  the  Exchange) accepts  responsibility  for  the 
adequacy or accuracy of this release.

About CRAiLAR Technologies Inc.

CRAiLAR®  Technologies   Inc.,   previously  known   as   Naturally   Advanced 
Technologies  Inc.,  offers  cost-effective  and  environmentally  sustainable 
natural fiber in  the form  of flax,  hemp and other  best fibers  for use  in 
textile, industrial,  energy,  medical and  composite  material  applications. 
Produced using a  fraction of water  and chemical inputs  compared with  other 
natural fibers,  CRAiLAR Flax  is used  primarily as  a compliment  to  cotton 
today, and aims to  supplement the impending natural  fiber gap caused by  the 
increased use of cotton and other  natural fibers in emerging global  markets. 
The  Company  supplies  its  CRAiLAR  Flax  to  HanesBrands,  Georgia-Pacific, 
Brilliant Global Knitwear, Tuscarora Yarns, and Target for commercial use, and
to Levi Strauss & Co., Cintas, Carhartt, Ashland, Target, PVH Corp and Lenzing
for evaluation and development. The Company was founded in 1998 as a  provider 
of  environmentally  friendly,   socially  responsible   clothing.  For   more 
information, visit www.crailar.com.

ADVISORY: This press  release contains  forward looking  statements which  may 
include statements concerning completion of any proposed acquisitions, capital
programs, debt, funds flow from operations,  closing date of the Offering  and 
the anticipated use of the net proceeds of the Offering. Although CL believes
that the  expectations  reflected  in these  forward  looking  statements  are 
reasonable, undue reliance should not be placed on them because CL can give no
assurance that they will prove to be correct. Since forward looking statements
address future  events  and conditions,  by  their very  nature  they  involve 
inherent  risks  and  uncertainties.  Any  proposed  acquisition  may  not  be 
completed if required  approvals or  some other  condition to  closing is  not 
satisfied. The closing of the Offering could  be delayed if CL is not able  to 
obtain the necessary regulatory and stock exchange approvals on the  timelines 
it has planned. The Offering will not  be completed at all if these  approvals 
are not obtained  or some  other condition to  the closing  is not  satisfied. 
Accordingly, there is a  risk that any proposed  acquisition or offering  will 
not be completed within the  anticipated time or at  all. The intended use  of 
the net proceeds of the Offering by CL might change if the board of  directors 
of CL determines that it  would be in the best  interests of CL to deploy  the 
proceeds for some other purpose.

The forward looking statements contained in this press release are made as  of 
the date hereof and CL undertakes no obligations to update publicly or  revise 
any forward looking  statements or  information, whether  as a  result of  new 
information, future  events or  otherwise, unless  so required  by  applicable 
securities laws.

The Exchange has neither approved nor  disapproved the contents of this  press 
release.

SOURCE Crailar Technologies Inc.

Contact:

Media Contact:
Ryan Leverenz
CRAiLAR Technologies Inc.
(415) 999-1418
ryan.leverenz@naturallyadvanced.com

Investor Contact:
Mark McPartland
MZ Group
(646) 593-7140
ir@crailar.com

Corporate Officer:
Guy Prevost
Chief Financial Officer
CRAiLAR Technologies Inc.
(866) 436-7869
ir@crailar.com
 
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