/Not for distribution to U.S. newswire services or for dissemination in
TORONTO, Nov. 22, 2011 /CNW/ - Chemtrade Logistics Income Fund (TSX:
CHE:UN) ("Chemtrade") today announced that it has entered into an
agreement with a syndicate of underwriters led by Scotia Capital Inc.
and including BMO Capital Markets, TD Securities Inc., CIBC and
National Bank Financial Inc. pursuant to which the underwriters will
purchase $80 million principal amount of convertible unsecured
subordinated debentures (the "Debentures") at a price of $1,000 per
Debenture. Chemtrade has also granted the underwriters an
over-allotment option to purchase up to an additional $12 million
aggregate principal amount of Debentures at the same price, exercisable
in whole or in part at any time for a period of 30 days following
closing of the offering.
The Debentures will mature on December 31, 2018 and will accrue interest
at the rate of 5.75% per annum payable semi-annually in arrears on June
30 and December 31 in each year, commencing on June 30, 2012. At the
holder's option, the Debentures may be converted into trust units of
Chemtrade at any time prior to the earlier of the maturity date and the
date of redemption specified by Chemtrade at a conversion price of
$20.00 per unit.
The Debentures will be direct, unsecured obligations of Chemtrade,
subordinated to other indebtedness of Chemtrade and ranking equally
with all other unsecured subordinated indebtedness.
The Debentures will not be redeemable before January 1, 2015. On or
after January 1, 2015 and prior to January 1, 2017, Chemtrade 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 Chemtrade
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 January 1, 2017 and prior to the maturity date, Chemtrade
may, at its option, redeem the Debentures, in whole or in part, from
time to time at par plus accrued and unpaid interest.
Chemtrade will use the net proceeds of the offering to repay existing
indebtedness under its credit facility and for general trust purposes.
The offering is scheduled to close on or about December 12, 2011 and is
subject to certain conditions including, but not limited to, the
receipt of all necessary approvals, including the approval of the
Toronto Stock Exchange.
A preliminary short-form prospectus will be filed with securities
regulatory authorities in all provinces of Canada. 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.
Chemtrade operates a diversified business providing industrial chemicals
and services to customers in North America and around the world.
Chemtrade is one of North America's largest suppliers of sulphuric
acid, liquid sulphur dioxide and sodium hydrosulphite, and a leading
processor of spent acid. Chemtrade is also a leading regional supplier
of sulphur, sodium chlorate, phosphorous pentasulphide, zinc oxide, and
water treatment chemicals. Chemtrade also provides industrial services
such as processing hydrogen sulphide and other by-products and waste
Caution regarding forward-looking statements
Certain statements contained in this news release constitute
forward-looking statements within the meaning of certain securities
laws, including the Securities Act (Ontario). Forward-looking statements can be generally identified by
the use of words such as "anticipate", "continue", "estimate",
"expect", "expected", "intend", "may", "will", "project", "plan",
"should", "believe" and similar expressions. Specifically,
forward-looking statements in this news release include statements respecting certain future expectations about:
Chemtrade's ability to complete the offering, the timing for the
completion of the offering and the intended use of the proceeds.
Forward-looking statements in this news release describe the
expectations of Chemtrade and its subsidiaries as of the date hereof.
These statements involve known and unknown risks, uncertainties and
other factors that may cause actual results or events to differ
materially from those anticipated in such forward-looking statements
for a variety of reasons, including without limitation the risks and
uncertainties detailed under the "RISK FACTORS" section of Chemtrade's latest Annual Information Form and the "RISKS AND UNCERTAINTIES" section of Chemtrade's most recent Management
Discussion & Analysis.
Although Chemtrade believes the expectations reflected in these
forward-looking statements and the assumptions upon which they are
based are reasonable, no assurance can be given that actual results
will be consistent with such forward-looking statements, and they
should not be unduly relied upon. With respect to the forward-looking
statements contained in this news release, Chemtrade has made
assumptions regarding: there being no significant disruptions affecting
the operations of Chemtrade and its subsidiaries, whether due to labour
disruptions, supply disruptions, power disruptions, transportation
disruptions, damage to equipment or otherwise; and global economic
Chemtrade disclaims any intention or obligation to update any
forward-looking statement even if new information becomes available, as
a result of future events or for any other reason. The forward-looking
statements contained herein are expressly qualified in their entirety
by this cautionary statement.
Further information can be found in the disclosure documents filed by
Chemtrade Logistics Income Fund with the securities regulatory
authorities, available at www.sedar.com.
SOURCE Chemtrade Logistics Income Fund
For further information:
| Mark Davis |
President and CEO
Tel: (416) 496-4176
| Rohit Bhardwaj |
Vice President Finance & CFO
Tel: (416) 496-4177