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TORONTO, May 20, 2014 /CNW/ - Chemtrade Logistics Income Fund
("Chemtrade" or the "Fund") (TSX: CHE.UN) announced today a public
offering, on a "bought deal" basis, of $110 million principal amount of
convertible unsecured subordinated debentures, at a price of $1,000 per
debenture, with an interest rate of 5.25% per annum, payable
semi-annually on the last day of June and December commencing on
December 31, 2014 (the "Debentures"). The Debentures will mature on
June 30, 2021.
The offering is being made through a syndicate of underwriters led by
BMO Capital Markets and Scotiabank.
The Fund has also granted the underwriters the option to purchase up to
$16.5 million principal amount of additional Debentures at a price of
$1,000 per Debenture to cover over-allotments, exercisable in whole or
in part any time up to 30 days following closing of the offering.
The Debentures will be convertible at the holder's option into fully
paid and non-assessable freely tradeable units of the Fund at the
option of the holder at a conversion price of $28.00 per unit. The
Debentures will not be redeemable before June 30, 2017. On or after
June 30, 2017 and prior to June 30, 2019, the Debentures may be
redeemed in whole or in part from time to time at the option of the
Fund at par plus accrued and unpaid interest, provided that the
weighted average trading price of the units on the Toronto Stock
Exchange for the 20 consecutive trading days ending five trading days
preceding the date on which notice of redemption is given is not less
than 125% of the Conversion Price. On or after June 30, 2019, the
Debentures may be redeemed at the option of the Fund at any time at par
plus accrued and unpaid interest.
The net proceeds of the offering will be used to repay existing
indebtedness and for general trust purposes.
The offering is subject to normal regulatory approvals, including
approval of the Toronto Stock Exchange, and is expected to close on or
about June 10, 2014.
The Debentures will be offered by way of a short form prospectus in all
of the provinces and territories of Canada and may also be offered to
qualified institutional buyers pursuant to Rule 144A in the United
The securities offered have not been 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. This press release shall not constitute
an offer to sell or the solicitation of an offer to buy securities in
the United States, nor shall there be any offer, solicitation or sale
of the securities in any jurisdiction in which such offer, solicitation
or sale would be unlawful.
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, inorganic coagulants for water treatment, liquid sulphur dioxide,
sodium nitrite and sodium hydrosulphite. Chemtrade is a leading
processor of spent acid as well as a leading regional supplier of
sulphur, sodium chlorate, phosphorus pentasulphide, and zinc oxide.
Additionally, Chemtrade provides industrial services such as processing
by-products and waste streams.
Caution Regarding Forward-Looking Statements
Certain statements contained in this news release constitute
forward-looking information within the meaning of certain securities
laws, including the Securities Act (Ontario). Forward-looking
information 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 information in this news
release include statements respecting certain future expectations about
the Fund's ability to close the Offering and its timing and the use to
be made of its proceeds. Forward-looking statements in this news
release describe the expectations of the Fund 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
the Fund's latest Annual Information Form and the "Risks and
Uncertainties" section of the Fund's most recent Management's
Discussion & Analysis.
Although the Fund 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, the Fund has made
assumptions regarding: there being no significant disruptions affecting
the operations of the Fund and its subsidiaries; the timely receipt of
required regulatory approvals; and global economic performance.
The Fund disclaims any intention or obligation to update any
forward-looking information even if new information becomes available,
as a result of future events or for any other reason, except as
required by law. The forward-looking information 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:
President & CEO
Tel: (416) 496-4176
Vice President, Finance & CFO
Tel: (416) 496-4177