/THIS NEWS RELEASE IS INTENDED FOR DISTRIBUTION IN CANADA ONLY AND IS NOT
AUTHORIZED OR INTENDED FOR DISTRIBUTION TO UNITED STATES NEWSWIRE
SERVICES OR FOR PUBLICATION OR DISSEMINATION IN THE UNITED STATES/
OTTAWA, Aug. 31 /CNW Telbec/ - Allen-Vanguard Corporation
("Allen-Vanguard" or the "Company") (TSX:VRS) is pleased to announce that it
has filed its preliminary short form prospectus with Canadian securities
regulatory authorities in connection with a public offering of common shares
of the Company ("Common Shares") in all provinces of Canada (the "Offering").
Aggregate gross proceeds are expected to be approximately $200,000,000. The
Offering will be lead by Genuity Capital Markets and include Paradigm Capital
Inc., Versant Partners Inc. and Canaccord Adams (together, the
"Underwriters"). Oppenheimer & Co. Inc. will participate as a special selling
group member in the Offering of Common Shares on an exempt basis in the United
States. The Underwriters will have an option, exercisable for a period of 30
days following the closing date of the Offering, to purchase from the Company
that number of common shares representing up to 15% of the Offering.
As disclosed in the Company's press release dated August 3, 2007, the
acquisition of Med-Eng Systems Inc. (the "Med-Eng Acquisition") will be
financed through a term debt facility, a revolver facility, subordinated debt,
cash reserves available and the private placement of subscription receipts,
which private placement closed on August 15, 2007 (the "Private Placement").
The net proceeds from the Offering will be used, in order of priority:
(i) to repurchase $150 million of subordinated debt; (ii) to repurchase from
the vendors of Med-Eng the portion of the subordinated debt representing the
excess working capital of Med-Eng at the closing of the Med-Eng Acquisition;
and (iii) to repay a portion of the term debt facility.
In connection with the term debt facility, the Company has agreed,
subject to regulatory approval, to issue to the arrangers thereof, common
share purchase warrants (the "Arrangers' Warrants") to acquire in the
aggregate 3,000,000 Common Shares of the Company, provided that the number of
Common Shares issuable upon the exercise of the Arrangers' Warrants will not
be less than 3% of the Company's issued and outstanding Common Shares on a
fully-diluted basis on the date of issue. In addition, the Company has agreed
to pay the arrangers of the term debt facility a cash fee in connection with
such arrangement or, at the option of the arrangers of the term debt facility,
additional common share purchase warrants of equivalent value (the "Additional
Arrangers' Warrants" and together with the Arrangers' Warrants, the "Share
Purchase Warrants"), representing the difference in the Black-Scholes value
between the Arrangers' Warrants actually issued and the warrants with the same
terms except for an exercise price of $6.85, and in each case assuming a
volatility of 40% for purposes of determining the Black-Scholes value.
Each of the Share Purchase Warrants will be exercisable for one Common
Share upon payment of an exercise price equal to the offering price of this
Offering. The final short form prospectus will qualify the Share Purchase
The Offering is expected to close in late September 2007 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
applicable securities regulatory authorities.
In furtherance of the Private Placement, the Company will file a separate
short form prospectus qualifying the common shares underlying the special
warrants issuable upon the exercise of the subscription receipts.
The Company anticipates that the previously announced Med-Eng Acquisition
will close in early September 2007.
This news release does not constitute an offer to sell or a solicitation
of an offer to buy any of the securities in the United States. The securities
have not and will not be registered under the United States Securities Act of
1933, as amended, or any state securities laws and may not be offered or sold
within the United States or to U.S. Persons (as such term is defined in
Regulation S of the United States Securities Act of 1933, as amended) unless
an exemption from such registration is available. This press release shall not
constitute an offer to sell or a solicitation of an offer to buy nor shall
there be any sale of the securities in any State in which such offer,
solicitation or sale would be unlawful.
Allen-Vanguard Corporation and its subsidiaries worldwide operate under
the brand "Allen-Vanguard". Allen-Vanguard develops and markets technologies,
tools and training for defeating and minimizing the effects of hazardous
devices and materials, whether Chemical, Biological, Radiological, Nuclear or
Explosive ("CBRNE"). Allen-Vanguard's equipment is in service with leading
security and military forces in more than 120 countries. Products include
Electronic Counter-Measures ("ECM") equipment for jamming remote detonation of
terrorist devices, specialty security equipment for Explosive Ordnance
Disposal ("EOD"), remote intervention robots for hazardous applications,
vehicle barrier systems, and personal protective wear for use in dealing with
bio-chemical agents. Allen-Vanguard is the sole, worldwide licensee and/or
developer of patented technologies such as the Universal Containment System
and CASCAD Foam for blast mitigation and decontamination of bio-chemical
warfare agents. Head office operations are located in Ottawa, Ontario, Canada,
with manufacturing operations in Stoney Creek, Ontario; Tewkesbury, U.K.; and
Cork, Ireland, and sales offices in Canada, the U.S., the U.K. and Asia.
Allen-Vanguard's shares are listed on The Toronto Stock Exchange (TSX: VRS).
This press release contains forward-looking statements, which reflect
Allen-Vanguard's current expectations regarding future events, its strategy,
expected performance and condition. Forward-looking statements include
statements that are predictive in nature, that depend upon or refer to future
events or conditions, or that include words such as "expects," "anticipates,"
"plans," "believes," "estimates" or negative versions thereof and similar
expressions. In addition, any statement that may be made concerning future
performance, strategies or prospects, and possible future acquisitions or
dispositions, is also a forward-looking statement. Forward-looking statements
are based on current expectations and projections about future events and are
inherently subject to, among other things, risks, uncertainties and
assumptions about the Company and economic factors. Forward-looking statements
are not promises or guarantees of future performance, and actual events and
results could differ materially from those expressed or implied in any
forward-looking statements made about the Company. Any number of important
factors could contribute to these digressions, including, but not limited to,
general economic, political and market factors in North America and
internationally, interest and foreign exchange rates, global equity and
capital markets, business competition, technological change, changes in
government regulations, unexpected judicial or regulatory proceedings, and
catastrophic events. We stress that the above-mentioned list of important
factors is not exhaustive. We encourage you to consider these and other
factors carefully before making any investment decision and we urge you to
avoid placing undue reliance on forward-looking statements. Further, you
should be aware that the Company disclaims any obligation to publicly update
or revise any such forward-looking statements whether as a result of new
information, future events or otherwise, prior to the release of the next
Management Discussion and Analysis to be released by the Company or except as
required by law .
To find out more about Allen-Vanguard Corporation (TSX: VRS), visit our
website at www.allen-vanguard.com.
For further information:
For further information: Elisabeth Preston, (613) 614-4884