Exercise in Full of Over-Allotment Option by Underwriters
/NOT FOR DISTRIBUTION IN THE UNITED STATES OR OVER UNITED STATES WIRE SERVICES/
TORONTO, June 7, 2016 /CNW/ - Crius Energy Trust ("Crius" or the "Trust") (TSX: KWH.UN) is pleased to announce that it has completed its previously announced public offering of 8,581,300 subscription receipts of the Trust ("Subscription Receipts") at a price of C$8.45 per Subscription Receipt, which includes 1,119,300 Subscription Receipts issued pursuant to the exercise in full of the over-allotment option by the Underwriters (as defined herein), for total gross proceeds of approximately C$72.5 million (the "Offering"). Each Subscription Receipt entitles the holder thereof to receive, without payment of additional consideration or further action on the part of such holder, one unit of the Trust (each a "Unit") upon the satisfaction (or waiver) of the escrow release conditions, relating to the closing of the previously announced Tender Offer (as defined herein).
The Offering was undertaken by a syndicate of underwriters co-led by Desjardins Securities Inc., Scotia Capital Inc. and RBC Dominion Securities Inc. (collectively, the "Co-Lead Underwriters"), and including Cormark Securities Inc., Canaccord Genuity Corp. and Mackie Research Capital Corp (collectively, with the Co-Lead Underwriters, the "Underwriters"). The Subscription Receipts were issued pursuant to a final short form prospectus dated June 2, 2016 (the "Final Prospectus"), filed by the Trust in each of the provinces and territories in Canada other than Québec.
The gross proceeds from the Offering, less an amount equal to (i) 50% of the commission of the Underwriters, and (ii) the costs and expenses of the Underwriters payable by the Trust (collectively, the "Escrowed Funds") have been deposited with Computershare Trust Company of Canada, as escrow agent (the "Escrow Agent") to be invested in one or more interest-bearing trust accounts maintained by the Escrow Agent pursuant to the terms of the subscription receipt agreement dated June 7, 2016 (the "Subscription Receipt Agreement") among the Trust, the Escrow Agent and the Co-Lead Underwriters (on behalf of the Underwriters), until the earlier of (i) the satisfaction (or waiver) of the escrow release conditions, relating to the closing of the Tender Offer, or (ii) the occurrence of a termination event, each as more particularly described in the Subscription Receipt Agreement.
Background to Offering and Tender Offer
On May 18, 2016, the Trust and Crius Energy Corporation ("US Holdco"), an indirect wholly-owned subsidiary of the Trust, initiated a tender offer (the "Tender Offer") to purchase all of the membership units of Crius Energy, LLC (the "Company") not already owned, directly or indirectly, by the Trust (the "Remaining LLC Acquisition"). After giving effect to the completion of the Remaining LLC Acquisition, the Trust is expected to hold, directly or indirectly, a 100% ownership interest in the Company.
The Tender Offer expires at 5:00 p.m. (Toronto time) on June 20, 2016, unless extended up to 60 additional days or earlier terminated by the Trust or US Holdco. The Remaining LLC Acquisition is expected to close shortly after the Tender Offer expires, subject to the satisfaction of the condition precedents in the Tender Offer, including the approval by the unitholders of the Trust at the annual and special meeting to be held on June 20, 2016 of the Units to be issued in connection with the Remaining LLC Acquisition.
Crius intends to use the Escrowed Funds it receives primarily to fund, directly or indirectly, the aggregate cash portion of the purchase price payable in connection with the Tender Offer, provided that the escrow conditions have been satisfied (or waived) on or before the occurrence of a termination event, each as more particularly described in the Subscription Receipt Agreement.
Further information relating to the Trust, the Remaining LLC Acquisition, the Offering and the Tender Offer is set forth in the Final Prospectus, which may be obtained on SEDAR under the Trust's issuer profile at www.sedar.com.
This news release does not constitute an offer of securities for sale in the United States. The securities being offered have not been, nor will they be, registered under the Unites States Securities Act of 1933, as amended, and such securities may not be offered or sold within the United States absent U.S. registration or an applicable exemption from U.S. registration requirements.
About Crius Energy Trust
The Trust was established to provide investors with a distribution-producing investment through its ownership interest in the Company. With over 900,000 residential customer equivalents, the Company is a comprehensive energy solutions partner that provides electricity, natural gas and solar products to residential and commercial customers. The Company connects with energy customers through an innovative family-of-brands strategy and multi-channel marketing approach. This unique combination creates multiple access points to a broad suite of energy products and services that make it easier for consumers to make informed decisions about their energy needs. The Company currently sells energy products in 17 states and the District of Columbia with plans to continue expanding its geographic reach.
The Trust intends to continue to qualify as a "mutual fund trust" under the Income Tax Act (Canada) (the "Tax Act"). The Trust will not be a "SIFT trust" (as defined in the Tax Act), provided that the Trust complies at all times with its investment restriction which preclude the Trust from holding any "non-portfolio property" (as defined in the Tax Act). Material information pertaining to the Crius may be found on SEDAR under the Trust's issuer profile at www.sedar.com or on the Trust's website at www.criusenergytrust.ca.
Cautionary Statement Regarding Forward-Looking Information
This news release contains forward-looking statements and forward-looking information (collectively, "Forward-Looking Statements") that involve substantial known and unknown risks and uncertainties, most of which are beyond the control of Crius, including, without limitation, those risks described in the annual information form of the Trust for the fiscal year ended December 31, 2015, dated March 15, 2016 (under the heading "Risk Factors"), in the MD&A of the Trust for the three month period ended March 31, 2016 and in the Final Prospectus. Any statements that express, or involve discussions as to, expectations, beliefs, plans, objectives, assumptions or future events or performance (often, but not always, through the use of words of phrases such as "will likely result", "are expected to", "expects", "will continue", "is anticipated", "anticipates", "believes", "estimated", "intends", "plans", "forecast", "projection" and "outlook") are not historical facts and may be Forward-Looking Statements which involve estimates, assumptions and uncertainties which could cause actual results or outcomes to differ materially from those expressed in such Forward-Looking Statements. Forward-Looking Statements in this news release include, but are not limited to, the anticipated timing and ability of the Trust to satisfy the conditions precedent to the conversion of the Subscription Receipts into Units, if at all; the timing and ability of the Trust to complete the Remaining LLC Acquisition, if at all; the timing and receipt of required approvals for the Remaining LLC Acquisition; the anticipated date to hold the annual and special meeting of unitholders of the Trust; and the Trust's objectives and status as a "mutual fund trust" and not a "SIFT trust". These Forward-Looking Statements are based on reasonable assumptions and estimates of management of the Trust at the time such statements were made. Actual future results may differ materially as Forward-Looking Statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Trust to materially differ from any future results, performance or achievements expressed or implied by such Forward-Looking Statements. Crius cautions investors of the Trust's securities about important factors that could cause Crius' actual results to differ materially from those projected in any Forward-Looking Statements included in this news release. No assurance can be given that the expectations set out in this news release will prove to be correct and accordingly, prospective investors should not place undue reliance on these Forward-Looking Statements. These statements speak only as of the date of this news release and Crius does not assume any obligation to update or revise them to reflect new events or circumstances, except as required by law.
Neither the Toronto Stock Exchange nor its Regulation Services Provider (as that term is defined in the policies of the Toronto Stock Exchange) accepts responsibility for the adequacy or accuracy of this release.
SOURCE Crius Energy Trust
For further information: Michael Fallquist, Chief Executive Officer, [email protected], (203) 663-7545; Roop Bhullar, Chief Financial Officer, [email protected], (203) 883-9900; Kelly Castledine, Investor Relations, [email protected], (416) 644-1753