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Press release from Marketwire

ENTREC Corporation Announces a $20 Million Bought Deal Convertible Debenture Offering

Wednesday, October 10, 2012

ENTREC Corporation Announces a $20 Million Bought Deal Convertible Debenture Offering16:41 EDT Wednesday, October 10, 2012TORONTO, ONTARIO--(Marketwire - Oct. 10, 2012) -NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR DISSEMINATION IN THE UNITED STATES. ENTREC Corporation ("ENTREC" or the "Company") (TSX VENTURE:ENT), today announced that it has entered into an agreement with a syndicate of underwriters led by National Bank Financial Inc. to sell to the public, on a bought deal basis, $20 million principal amount of convertible unsecured subordinated debentures (the "Debentures") at a price of $1,000 per Debenture (the "Offering"). The Company has granted the underwriters an over-allotment option to purchase up to an additional $3 million of Debentures at the same price, exercisable in whole or in part for a period of 30 days following closing of the Offering, to cover over-allotments. If the over-allotment option is exercised in full, the total gross proceeds to ENTREC from the sale of Debentures will be $23 million. The Company intends to use the net proceeds from the Offering for future acquisitions, to reduce indebtedness and for general corporate purposes. The Debentures will bear interest from the date of issue at 7.0% per annum, payable semi-annually in arrears on October 31 and April 30 each year commencing April 30, 2013. The Debentures will have a maturity date of October 31, 2017 (the "Maturity Date"). The Debentures will be convertible at the holder's option at any time prior to the close of business on the earlier of the Maturity Date and the business day immediately preceding the date specified by the Company for redemption of the Debentures into common shares at a conversion price ("Conversion Price") of $2.60 per common share, being a conversion rate of 384.6154 common shares for each $1,000 principal amount of Debentures. The Debentures are not redeemable prior to October 31, 2015. On and after October 31, 2015 and prior to October 31, 2016 the Debentures are redeemable at par provided that the market price for ENTREC shares prior to the date of notice of redemption is not less than 125% of the Conversion Price. On and after October 31, 2016, the Debentures will be redeemable at par. Upon conversion, in lieu of shares, the Company may elect to pay the holder in cash. In addition, subject to any required regulatory approval, the Company has the option to satisfy its obligation to repay the principal amount of the Debentures on redemption or maturity in freely tradable shares (based on 95% of the market price on the date of redemption or maturity). In certain circumstances where a holder elects to convert Debentures in connection with a change of control prior to maturity, the holder may be entitled to receive additional shares as a make-whole premium. Closing of the Offering is expected to occur on or about October 30, 2012. The Offering is subject to normal regulatory approvals, including approval of the TSX Venture Exchange. The Debentures will be offered in each of the provinces of Canada (except Quebec) by way of a short form prospectus that will be filed with securities regulatory authorities in all provinces of Canada (except Quebec). The securities offered have not been 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 applicable exemption from the registration requirements. This news release does not constitute an offer to sell or the solicitation of any offer to buy nor will there be any sale of these securities in any province, state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such province, state or jurisdiction. No securities regulatory authority has either approved or disapproved of the contents of this news release. The securities being offered have not been, and will not be, registered under the United States Securities Act of 1933, as amended (the "U.S. Securities Act"), or any state securities laws, and may not be offered or sold in the United States unless pursuant to an exemption therefrom. This press release is for information purposes only and does not constitute an offer to sell or a solicitation of an offer to buy any securities of ENTREC Corporation in any jurisdiction. About ENTREC ENTREC specializes in the lifting, transportation (over the road and on-site), loading, off-loading and setting of overweight and oversized cargo for the oil and gas, construction, petrochemical, mining and power generation industries. The common shares of ENTREC trade on the TSX Venture Exchange under the trading symbol "ENT". This press release contains statements that may constitute "forward-looking statements" within the meaning of applicable Canadian securities legislation. These forward-looking statements include, among others, statements regarding business strategy, plans and other expectations, beliefs, goals, objectives, information and statements about possible future events. Readers are cautioned not to place undue reliance on such forward-looking statements. Forward-looking statements are based on current expectations, estimates and assumptions that involve a number of risks, which could cause actual results to vary and in some instances to differ materially from those anticipated by ENTREC Corporation and described in the forward-looking statements contained in this press release. No assurance can be given that any of the events anticipated by the forward-looking statements will transpire or occur or, if any of them do so, what benefits ENTREC Corporation will derive there-from. FOR FURTHER INFORMATION PLEASE CONTACT: Rod MarlinENTREC CorporationChairman & CEO(780) 960-5647ORJohn M. StevensENTREC CorporationPresident & COO(780) 960-5625ORJason VandenbergENTREC CorporationCFO(780) 960-5630