DRUMMONDVILLE, QC, May 29 /CNW Telbec/ - CVTech Group Inc. (TSX: CVT)
("CVTech" or the "Company") announced today it has entered into an agreement
with Laurentian Bank Securities Inc. ("LBS") to sell, on a bought deal private
placement basis, 3,781,250 Subscription Receipts ("Subscription Receipts") at
a price of $1.60 per Subscription Receipt (the "Subscription Receipt
Financing"), and 3,412,500 common shares from treasury of the Company at a
price of $1.60 per common share (the "QSSP Private Placement")., for aggregate
gross proceeds of $ 11,510,000. The closing of the QSSP Private Placement is
conditional on CVTech being an eligible issuer under the QSSP II program.
CVTech will use the net proceeds from the Subscription Receipt Financing and
the QSSP Private Placement (the "Offering") to fund the acquisition announced
by the Company on February 11, 2009 (the "Acquisition"), currently expected to
close on July 1, 2009.
LBS has also been granted an option to purchase an additional 2,181,250
Subscription Receipts (the "Additional Subscription Receipts") at a purchase
price of $1.60 per Additional Subscription Receipt which option may be
exercised at any time or times by the Underwriter by notice in writing no
later than 48 hours prior to the closing date of the Acquisition.
Each Subscription Receipt will be exchangeable into, for no additional
consideration, one common share of CVTech at the time of the closing of the
Acquisition. In the event the Acquisition does not close by August 15, 2009,
the gross proceeds raised under the Offering shall be returned to the
investors which participated therein, and the Subscription Receipts will
become null and void. The Offering is made pursuant to prospectus and
registration exemptions in each of the provinces and territories of Canada, as
well as in the United States under applicable private placement exemptions.
The Offering is expected to close on or about June 16, 2009 and is subject to
applicable regulatory approvals.
About CVTech Group Inc.
CVTech has two operating divisions, Electrical and Vehicle Subsidiary
Thiro, provides services for the construction and maintenance of electrical
transmission and distribution lines. It has two indirect subsidiaries: Thiro
USA and J.J.L. Déboisement inc. ("J.J.L.") Thiro USA, like Thiro, provides
services for the construction and maintenance of electrical transmission and
distribution lines. J.J.L. specializes in vegetation control on rights-of-way
for transmission and distribution lines. Subsidiaries within the Vehicle
division design, manufacture and sell CVTs. Subsidiary CVTech-AAB inc.
specializes in the rebuilding of crankshafts and reconditioning of cylinders,
and the distribution of engine parts. CVTech is the owner of the trademarks
and CVTech R&D inc. holds the intellectual property on products which are part
of its technological solutions. CVTech currently has a staff of approximately
715 employees comprising 160 employees in the CVT systems and related products
segments and 555 employees in the electricity segment.
This press release shall not constitute an offer to sell or the
solicitation of an offer to buy, which may be made only by means of a
prospectus, nor shall there be any sale of the Subscription Receipts in any
state, province or other jurisdiction in which such offer, solicitation or
sale would be unlawful prior to registration or qualification under securities
laws of any such state, province or other jurisdiction. The Subscription
Receipts of CVTech have not been and will not be registered under the U.S.
Securities Act of 1933, as amended, and may not be offered, sold or delivered
in the United States absent registration or an application for exemption from
the registration requirements of U.S. securities laws.
For further information:
For further information: André Laramée, MBA, President and CEO, CVTech
Group Inc., (819) 479-7771; Mario Trahan, CMA, Chief Financial Officer, CVTech
Group Inc., (819) 479-7771