Exchange Income Corporation Announces $30,000,000 Financing of 7.5% Convertible Senior Secured Debentures



    
    /NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN
    THE UNITED STATES. ANY FAILURE TO COMPLY WITH THIS RESTRICTION MAY
    CONSTITUTE A VIOLATION OF U.S. SECURITIES LAW/

    TSX SYMBOL: EIF
    

    WINNIPEG, Aug. 20 /CNW/ - Exchange Income Corporation (the "Corporation")
(TSX:EIF) announced today that it has reached an agreement with a syndicate of
underwriters co-led by National Bank Financial Inc. and Wellington West
Capital Inc. (the "Underwriters"), pursuant to which the Corporation will
issue on a "bought-deal" basis, subject to regulatory approval, $30,000,000
aggregate principal amount of convertible senior secured debentures (the
"Debentures") at a price of $1,000 per $1,000 principal amount of Debentures
(the "Offering"). The Corporation has granted to the Underwriters an
over-allotment option to purchase up to an additional $4,500,000 aggregate
principal amount of Debentures at the same price, exercisable in whole or in
part at any time for a period of up to 30 days following closing of the
Offering, to cover over-allotments and for market stabilization purposes. The
Corporation intends to use the net proceeds from the Offering to reduce
indebtedness and for general corporate purposes.
    The Debentures will bear interest from the date of issue at 7.5% per
annum, payable semi-annually in arrears on March 31 and September 30 each year
commencing March 31, 2010. The Debentures will each have a maturity date of
September 30, 2014 (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 Corporation for
redemption of the Debentures into Common Shares at a conversion price of
$14.50 per Common Share, being a conversion rate of 68.966 Common Shares for
each $1,000 principal amount of Debentures.
    Closing of the Offering is expected to occur on or about September 11,
2009. The Offering is subject to normal regulatory approvals, including
approval of the Toronto Stock Exchange. The Debentures will be offered in each
of the provinces of Canada other than the province of Quebec by way of a short
form prospectus, and by way of private placement in the United States to
Qualified Institutional Buyers pursuant to Rule 144A.

    About Exchange Income Corporation

    Exchange Income Corporation is a diversified, acquisition-oriented
corporation, focused on opportunities in the industrial products and
transportation sectors which are ideally suited for public markets except for
their size. The strategy of the Corporation is to invest in profitable,
well-established companies with strong cash flows operating in niche markets
in Canada and/or the United States.
    The Corporation is currently operating in two niche business segments:
aviation and specialty manufacturing. The aviation segment consists of
Perimeter Aviation LP., Keewatin Air LP and Calm Air International LP and the
specialty manufacturing segment consists of Jasper Tank Ltd., Overlanders
Manufacturing LP, Water Blast Manufacturing LP, and Stainless Fabrication,
Inc. For more information on Exchange Income Corporation, please visit
www.exchangeincomecorp.ca.

    Caution Concerning Forward-Looking Statements

    The statements contained in this news release that are forward-looking
are based on current expectations and are subject to a number of uncertainties
and risks, and actual results may differ materially. These uncertainties and
risks include, but are not limited to, the dependence of the Corporation on
the operations and assets currently owned by it, the degree to which its
subsidiaries are leveraged, the fact that cash distributions are not
guaranteed and will fluctuate with the Corporation's financial performance,
dilution, restrictions on potential future growth, competitive pressures
(including price competition), changes in market activity, the cyclicality of
the industries, seasonality of the businesses, poor weather conditions, and
foreign currency fluctuations, legal proceedings, commodity prices and raw
material exposure, dependence on key personnel, and environmental, health and
safety and other regulatory requirements. Further information about these and
other risks and uncertainties can be found in the disclosure documents filed
by Exchange Income Corporation with the securities regulatory authorities,
available at www.sedar.com.

    
    The Toronto Stock Exchange has neither approved nor disapproved the
    contents of this press release.
    





For further information:

For further information: Exchange Income Corporation, Mike Pyle,
President and CEO, (204) 982-1850, mpyle@eig.ca; OR The Equicom Group Inc.,
Alice Dunning, Investor Relations, (416) 815-0700 or 1-800-385-5451 ext. 255,
adunning@equicomgroup.com


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