Press release from Marketwire
Armtec Infrastructure Income Fund Announces Closing of Bought Deal Financing
Wednesday, June 30, 2010
GUELPH, ONTARIO--(Marketwire - June 30, 2010) - Armtec Infrastructure Income Fund (TSX:ARF.UN) ("Armtec" or "the Fund") is pleased to announce that it has completed the issue and sale of 40,000 convertible unsecured subordinated debentures ("Debentures") of the Fund to a syndicate of underwriters at a price of $1,000 per Debenture, representing an aggregate of $40,000,000 principal amount of Debentures (the "Offering"). The syndicate of underwriters was co-led by Scotia Capital Inc. and BMO Capital Markets and included TD Securities Inc., National Bank Financial Inc., Canaccord Genuity Corp., M Partners Inc. and Raymond James Ltd.
The Debentures will mature on June 30, 2017 and will accrue interest at the rate of 6.50% per annum payable semi-annually in arrears on June 30 and December 31 in each year, commencing on December 31, 2010. At the holder's option, the Debentures may be converted into trust units of the Fund at any time prior to the earlier of the maturity date and the date of redemption specified by the Fund at a conversion price of $26.90 per unit.
The Debentures will be direct, unsecured indebtedness of Armtec, ranking subordinate to all present and future senior indebtedness of the Fund and ranking equally with all other unsecured indebtedness that is not senior indebtedness.
The Debentures may not be redeemed by the Fund before July 1, 2013, except in the event of the satisfaction of certain conditions after a "Change of Control" as defined in the indenture governing the Debentures. On or after July 1, 2013 and prior to July 1, 2015, Armtec may, at its option, redeem the Debentures, in whole or in part, provided that the volume weighted average trading price of the trust units of the Fund on the Toronto Stock Exchange during the 20 consecutive trading days ending on the fifth trading day preceding the date on which the notice of redemption is given is not less than 125% of the conversion price. On or after July 1, 2015 and prior to the maturity date, Armtec may, at its option, redeem the Debentures, in whole or in part, from time to time at a price equal to the principal amount thereof plus accrued and unpaid interest.
Proceeds from the Offering will be used to repay indebtedness and for general corporate purposes.
The securities offered have not and will not be registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements of such Act. This press release shall not constitute an offer to sell or the solicitation of an offer to buy the securities in any jurisdiction.
ABOUT ARMTEC INFRASTRUCTURE INCOME FUND
Armtec Infrastructure Income Fund is a leading manufacturer and marketer of a comprehensive range of infrastructure products and engineered construction solutions for customers in a diverse cross-section of industries that are located in every region of Canada, as well as in selected markets globally. These markets include Canada's national and regional public infrastructure markets and private sector markets in construction, commercial building, agricultural drainage and natural resources. Operating through its network of regional offices and production facilities across the country, Armtec's broad range of engineered solutions include products for drainage, bridge applications, soil retention, rehabilitation and water management systems including corrugated high-density polyethylene, corrugated steel and concrete pipe; an array of architectural and structural precast and pre-stressed concrete products from steps, paving stones, slabs and wall panels to highly engineered structural components designed and installed for projects such as bridges, sports venues and parking garages; and, a full suite of noise barriers, acoustic enclosure and wall systems along with associated retaining wall and traffic barrier systems. Armtec Infrastructure Income Fund is listed on the TSX under the ARF.UN symbol. For more information, please visit www.armtecincomefund.com.
RISKS AND UNCERTAINTIES
The Fund is subject to certain risks and uncertainties that could have a material adverse effect on the Fund's results of operations, business prospects, financial condition, cash distributions to unitholders and the trading price of the Fund's units. These uncertainties and risks include, but are not limited to: industry cyclicality; competition; acquisition and expansion risk; capital and liquidity risk; current global financial conditions; reduction in demand for products; information management; credit risk; relationships with suppliers; lack of long-term agreements; expiration of rights under license and distribution arrangements; availability and price volatility of raw materials; product liability; intellectual property; reliance on key personnel; labour markets; environmental; collective bargaining; currency fluctuations; interest rates; uninsured and underinsured losses; operating hazards; risk of future legal proceedings; securities laws compliance and corporate governance standards; geographical risk; seasonality and adverse weather; geopolitical; and certain risks related to the structure of the Fund including dependence on the Fund's subsidiaries; income tax matters; unitholder limited liability; leverage and restrictive covenants; credit facilities; nature of units; distribution of securities on redemption or termination of the Fund; restrictions on potential growth; effect of market interest rates on price of units; undiversified and illiquid holdings in Armtec Operating Trust; potential dilution. Cash distributions are not guaranteed. Further information about these and other risks and uncertainties can be found in the disclosure documents filed by Armtec Infrastructure Income Fund with the securities regulatory authorities, available at www.sedar.com.
This news release may contain "forward-looking" statements within the meaning of applicable securities legislation which involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Fund or industry results, to be materially different from any future results, events, expectations, performance or achievements expressed or implied by such forward-looking statements. All such forward-looking statements are made pursuant to the "safe harbour" provisions of applicable Canadian securities legislation. Forward-looking statements may include comments with respect to use of proceeds by the Fund from the Debenture offering. Forward-looking statements typically contain such words or phrases such as "may", "outlook", "objective", "intend", "estimate", "anticipate", "should", "could", "would", "will", "expect", "believe", "plan" and other similar terminology suggesting future outcomes or events. These statements reflect current expectations regarding future events and operating performance and are based on information currently available to the Fund's management.
Forward-looking statements involve numerous assumptions, and significant and inherent risks and uncertainties, should not be read as guarantees of future performance or results and will not necessarily be accurate indications of whether or not such results will be achieved. You should not unduly rely on forward-looking statements as a number of factors, many of which are beyond the control of the Fund, could cause actual results to differ materially from the results discussed in the forward-looking statements, including, but not limited to the factors discussed under "Risks and Uncertainties" and in the Fund's materials filed with the Canadian securities regulatory authorities from time to time including the Annual Information Form and the prospectus relating to the Debenture offering. Although the forward-looking statements contained in this release are based upon what management of the Fund believes are reasonable assumptions, the Fund cannot assure investors that actual results will be consistent with these forward-looking statements. All forward-looking statements in this news release are qualified by these cautionary statements. These forward-looking statements and outlook are made as of the date of this news release and, except as required by applicable law, the Fund assumes no obligation to update or revise them to reflect new events or circumstances.
FOR FURTHER INFORMATION PLEASE CONTACT:
Armtec Limited Partnership Charles M. Phillips President & Chief Executive Officer (519) 822-0210 (519) 822-8894 (FAX)or
Armtec Limited Partnership James R. Newell Chief Financial Officer (519) 822-0210 (519) 822-8894 (FAX)or
Armtec Limited Partnership Carrie Boutcher Vice President, Investor Relations & Treasurer (519) 822-0210 (519) 822-8894 (FAX)