WesternOne Inc. to Redeem Outstanding 8% Extendible Convertible Unsecured Subordinated Debentures and Extends Senior Credit Facility
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VANCOUVER, June 30, 2016 /CNW/ - WesternOne Inc. ("WesternOne") (Toronto Stock Exchange: WEQ, WEQ.DB, and WEQ.DB.C) announced today that pursuant to Section 4.3 of the trust indenture (the "Indenture") dated as of February 26, 2010 between WesternOne and Computershare Trust Company of Canada ("Computershare"), as trustee, as amended and supplemented pursuant to the supplemental indentures dated June 1, 2011 (the "First Supplemental Indenture"), December 31, 2012 and March 28, 2013, all of the 8% Extendible Convertible Unsecured Subordinated Debentures of WesternOne due June 30, 2018 (the "Debentures") that are outstanding on August 5, 2016 (the "Redemption Date") will be redeemed on the Redemption Date upon payment of a redemption amount of $1,007.67 for each $1,000 principal amount of Debentures, being equal to the aggregate of: (i) $71,027,000 (the "Redemption Price"); and (ii) all accrued and unpaid interest on the Debentures to but excluding the Redemption Date (collectively, the "Total Redemption Price").
Pursuant to Section 2.1(f) of the First Supplemental Indenture, holders of the Debentures will have the right to convert the whole or any part of the Debentures into common shares of WesternOne at any time prior to the close of business on the last business day immediately preceding the Redemption Date. The last date that a holder of Debentures may effect any conversion of Debentures is August 4, 2016.
The Total Redemption Price will be payable upon presentation and surrender of the Debentures called for redemption at the following corporate trust office:
| Computershare Trust Company of Canada |
| 3rd Floor – 510 Burrard Street |
| Vancouver, British Columbia |
The interest upon the principal amount of Debentures called for redemption shall cease to be payable from and after the Redemption Date.
Pursuant to Section 4.6 of the Indenture, WesternOne is exercising its right to satisfy its obligation to pay all of the Redemption Price payable to holders of Debentures by issuing freely tradeable common shares of WesternOne obtained by dividing the Redemption Price by 95% of the Current Market Price (as defined in the Indenture) of the common shares of WesternOne.
No fractional common shares will be delivered upon the exercise by WesternOne of the above-mentioned redemption but, in lieu thereof, WesternOne will pay the cash equivalent thereof determined on the basis of the Current Market Price of the common shares of WesternOne on the Redemption Date (less any tax required to be deducted, if any).
Upon presentation and surrender of the Debentures for payment on the Redemption Date, WesternOne will, on the Redemption Date, instruct Computershare to issue such number of freely tradeable common shares of WesternOne in uncertificated form, for delivery to and account of the holders, to which holders are entitled together with the cash equivalent in lieu of fractional common shares and cash for all accrued and unpaid interest up to, but excluding, the Redemption Date.
Amendment to Term Credit Facility
WesternOne today also announced, effective June 30, 2016 (the "Effective Date"), that it entered into an amended facility letter (the "Amended Facility Letter") with its senior lender (the "Bank").
Pursuant to the Amended Facility Letter:
- the maturity date of the term credit facility was extended from October 1, 2017 to October 1, 2018;
- the revolving operating line and the revolving capital expenditure facility were reduced from $30 million to $20 million and from $50 million to $45 million, respectively. The reductions represent excess credit facility that management believes would not be utilized by WesternOne based on the current business environment;
- the term credit facility carries interest at either prime rate plus 2.40% or banker's acceptance rate plus 3.65% until October 31, 2016, after which the margin will be determined based on the ratio of Senior Debt to EBITDA (as defined in the Amended Facility Letter). The margins range from 0.90% to 2.40% for prime-based borrowing, and range from 2.15% to 3.65% for banker's acceptance-based borrowing; and
- Total Net Debt to EBITDA covenant (as defined in the Amended Facility Letter) was adjusted to not exceed 5.0 to 1.0 from October 1, 2016 to March 31, 2017, 4.5 to 1.0 from April 1, 2017 to September 30, 2017, and 4.0 to 1.0 thereafter.
Forward-looking Information
Certain statements in this press release may constitute "forward-looking" information that involves known and unknown risks, uncertainties and other factors, and it may cause actual results, performance or achievements or industry results, to be materially different from any future results, performance or achievements or industry results expressed or implied by such forward-looking information. Forward-looking information is identified by the use of terms and phrases such as "anticipate", "believe", "could", "estimate", "expect", "intend", "may", "plan", "predict", "project", "will", "would", and similar terms and phrases, including references to assumptions. Such information includes, without limitation, statements with respect to: the timing, amount and form of payment for the redemption of the Debentures; and the maturity date under the Amended Facility Letter. Actual events or results may differ materially.
Forward-looking information contained in this press release is based on certain key expectations and assumptions made by WesternOne, including, without limitation: the outlook of WesternOne's business and the economy in Western Canada and the US, the supply and demand for WesternOne's products and services and management's assessment of future plans and operations. Although the forward-looking information contained in this press release is based upon what WesternOne's management believes to be reasonable assumptions, WesternOne cannot assure investors that actual results will be consistent with such information. Forward-looking information reflects current expectations of management regarding future events and operating performance as of the date of this press release. Such information involves significant risks and uncertainties, should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not such results will be achieved. A number of factors could cause actual results to differ materially from the results discussed in the forward-looking information, and a description of these factors can be found under "Risk Factors" in WesternOne's Annual Information Form dated March 30, 2016 and Management's Discussion and Analysis dated May 13, 2016, which are both available on SEDAR (www.sedar.com).
The forward-looking information contained herein is expressly qualified in its entirety by this cautionary statement. Forward-looking information reflects management's current beliefs and is based on information currently available to WesternOne. The forward-looking information is made as of the date of this press release and WesternOne assumes no obligation to update or revise such information to reflect new events or circumstances, except as may be required by applicable law.
About WesternOne
WesternOne seeks to acquire and grow businesses in the construction and infrastructure services sectors in order to generate value for its shareholders.
Additional Information
Additional information relating to WesternOne and other public filings, is available on SEDAR at www.sedar.com or on WesternOne's website at www.weq.ca.
Trading Symbols
Toronto Stock Exchange: WEQ, WEQ.DB, and WEQ.DB.C
THE TORONTO STOCK EXCHANGE HAS NOT REVIEWED AND DOES NOT ACCEPT RESPONSIBILITY FOR THE ADEQUACY OR THE ACCURACY OF THIS RELEASE.
SOURCE WesternOne Inc.
For more information about this press release, please contact: Carlos Yam, Chief Financial Officer, WesternOne Inc., Suite 910, 925 West Georgia Street, Vancouver, BC V6C 3L2, Phone: (604) 678-4042, E-mail: [email protected]; For investor relations information, please contact: Andrew Greig, Manager of Investor Relations, WesternOne Inc., Suite 910, 925 West Georgia Street, Vancouver, BC V6C 3L2, Phone: (604) 678-4042, E-mail: [email protected]
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