Mr. Brian Baker reports

MELCOR DEVELOPMENTS LTD. ANNOUNCES COMMON SHARE MARKET PRICE FOR REDEMPTION OF DEBENTURES

Upon redemption of its currently outstanding $40.0-million 6.25-per-cent convertible unsecured subordinated debentures due Feb. 8, 2017, for which a redemption notice was issued on June 24, 2014, common shares of Melcor Developments Ltd., each with an issue price of $24.66, will be issued to satisfy the principal amount of the debentures. Consequently, holders of debentures who have not elected to convert their debentures on or prior to Aug. 7, 2014, will receive 40.56 common shares for each $1,000 principal amount of debentures redeemed, plus a cash payment for accrued unpaid interest up to, but excluding, the Aug. 8, 2014, redemption date.

Pursuant to the terms of the debentures, the redemption issue price is calculated as 95 per cent of the volume-weighted average trading price of the common shares on the Toronto Stock Exchange for the 20 consecutive trading days ending on the fifth trading day preceding the redemption date.

Each holder not wishing to receive common shares upon redemption at the redemption issue price will have the right to convert their debentures into common shares at a conversion price of $18.51 per common share at any time on or prior to Aug. 7, 2014. A holder electing to convert the principal amount of their debentures will receive 54.02 common shares for each $1,000 principal amount of debentures converted, plus a cash payment for accrued unpaid interest up to, but excluding, the conversion date.

No fractional shares will be issued on redemption or conversion, but, in lieu thereof, the company shall pay the cash equivalent thereof determined on the basis of the current market price of the common shares on the redemption date or conversion date, as applicable (less any tax required to be deducted, if any).

We seek Safe Harbor.