/NOT FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR FOR
DISSEMINATION IN THE UNITED STATES/
LONDON, ON, May 4 /CNW/ - Pacific & Western Credit Corp (TSX: PWC) (the "Corporation" or "PWC") is pleased to announce that further to the April 28, 2011
announcement regarding a marketed public offering (the "Offering"), it now has entered into an underwriting agreement for an initial
amount of $15 million with an opportunity for existing shareholders to
subscribe for up to an additional $15 million. If the Offering is
fully subscribed, including the Over-Allotment Option described below,
total gross proceeds to the Corporation would be approximately $35
PWC has entered into an underwriting agreement with a syndicate of
underwriters led by Canaccord Genuity Corp. and including Scotia
Capital Inc., Industrial Alliance Securities Inc. and PI Financial
Corp. (the "Underwriters"). Pursuant to the agreement, the Underwriters have agreed to purchase
on an underwritten basis 6,666,667 units (the "Underwriter Units") of the Corporation at a price of C$2.25 per Unit (the "Offering Price") for aggregate gross proceeds of C$15 million. Each Underwriter Unit
consists of one common share in the capital of the Corporation (a "Common Share") and one-half of one common share purchase warrant (each whole
warrant, a "Warrant"). Each Warrant will entitle the holder thereof to acquire, for a
period of 18 months following the closing date of the Offering, one
Common Share at a price of C$2.80, representing a premium of approximately 25% to the Offering Price.
In addition, current shareholders of the Corporation may purchase up to
6,666,667 units (the "Remaining Units") at the same price and having the same structure as the Underwriter
Units, for aggregate gross proceeds of up to C$15 million. Any
Remaining Units that are not purchased by the current shareholders
prior to noon on May 20, 2011 may be purchased by the Underwriters and
reallocated. The prospectus related to the Offering will be mailed to
the current shareholders and will provide instructions to them about
how they can participate in the Offering.
In addition, the Corporation has granted to the Underwriters an option
(the "Over-Allotment Option") exercisable in whole or in part at any time within 30 days after the
closing date of the Offering, to purchase up to an additional 2,000,000
Underwriter Units (the "Additional Units") at a price of $2.25 per Additional Unit, including up to an
additional 1,000,000 Warrants (the "Additional Warrants"). The Additional Warrants can be purchased pursuant to the
Over-Allotment Option independent of the Additional Units at a price of
$0.22 per Additional Warrant.
In connection with the Offering, a preliminary short form prospectus has
been filed in each of the provinces and territories of Canada other
than Quebec. The Corporation will file an amended and restated
preliminary prospectus in each of the provinces and territories of
Canada other than Quebec to reflect the specific offering terms.
The Corporation plans to use a majority of the net proceeds of the
Offering to reduce the consolidated debt of the Corporation. This debt
was used to provide regulatory capital to the Corporation's
wholly-owned subsidiary, Pacific & Western Bank of Canada ("PWBank"), to fund its operations. The Corporation plans to use the remaining
net proceeds of the Offering to provide additional regulatory capital
in PWBank and for working capital purposes in the Corporation.
The Offering is expected to close on or about May 25, 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 and other securities regulatory authorities.
PWBank, a Canadian Schedule I chartered bank, is a branchless financial
institution. It specializes in providing financing throughout Canada to
well established corporations and government entities, including
hospitals, school boards, universities and colleges, municipalities,
provinces and territories, and federal government agencies.
Investor Relations: Wade MacBain, Director (800) 244-1509, firstname.lastname@example.org
Public Relations & Media: Tel Matrundola, Vice-President, (866)
To receive PWC news releases, please contact: Carla McPhee at email@example.com, (519) 675-4204
For further information:
Please visit our website at: http://www.pwbank.com