CALGARY,
AB, April 11, 2023 /CNW/ - Crown Capital
Partners Inc. ("Crown" or the "Corporation") (TSX: CRWN) today
announced that it will seek the approval of the holders (the
"Debentureholders") of its 6% convertible unsecured subordinated
debentures of the Corporation due June 30,
2023 (the "Debentures") to amend certain terms of such
Debentures at a special meeting of the Debentureholders to be held
at the offices of the Corporation, 33 Yonge Street, Suite 901,
Toronto, ON, M5E 1G4, on
May 16, 2023 at 10:00 a.m. (Eastern Time) (the "Meeting").
The proposed amendments to the Debentures (the "Debenture
Amendments"), which will be voted on as a package, consist of:
- Extending the maturity date of the Debentures from June 30, 2023 to December
31, 2024;
- Amending the interest rate on the Debentures from 6% to 10%
effective July 1, 2023;
- Removing the conversion right of the Debentureholders; and
- Removing the right of the Corporation to repay the principal
amount of the Debentures in common shares of the Corporation
("Common Shares") on the new maturity date or any redemption
date.
The board of directors of the Corporation believe that the
Debenture Amendments provide the following advantages:
- Extension of Maturity Date: The extension of the
maturity date will afford Debentureholders a longer period of
time during which to receive interest at a favourable rate.
- Increased Interest Rate: Increasing the interest
rate from 6% to 10% provides an attractive yield to
Debentureholders.
- Removal of Share Repayment Right: The Corporation
will no longer have the right to repay the principal amount on the
Debentures, in whole or in part, in Common Shares on the new
maturity date or any redemption date.
- Consent Fee: Any Debentureholder that
votes for the Debenture Amendments
will receive a cash consent
fee (the "Consent Fee")
of $10 per $1,000 principal amount of
Debentures held by that Debentureholder as of April 6, 2023 (the "Record
Date") provided that certain other conditions required
for the payment of the Consent Fee are satisfied,
including the Debenture Amendments are validly approved by
Debentureholders and the Toronto Stock Exchange (the "TSX").
The Debenture Amendments will provide additional short term
capital for Crown while it completes sales of assets, including the
continued liquidation of the remaining assets of its specialty
finance segment, which should provide sufficient funds to repay the
Debentures in cash. Provided that the Debenture Amendments are
approved, it is the intention of management of Crown to use some or
all of the proceeds of such asset sales to fund the redemption of
some or all of the Debentures as soon as these proceeds become
available.
The effective date of the Debenture Amendments will be
June 30, 2023. Further particulars of
the expected benefits of the Debenture Amendments will be described
in the management information circular of the Corporation relating
to the Meeting (the "Circular"), which will be available under the
Corporation's profile on SEDAR at www.sedar.com and which will be
mailed to Debentureholders in the coming days.
The Debenture Amendments will only be effective if passed by an
extraordinary resolution of the holders of at least 66⅔% of the
principal amount of the Debentures present in person or by proxy at
the Meeting and entitled to vote in respect of the Debenture
Amendments.
The Debenture Amendments are subject to the approval of the
TSX.
In the event that the Debenture Amendments are not approved by
Debentureholders and the TSX, the Debentures will mature on
June 30, 2023 and the Corporation
will consider the alternatives available to it to address the
maturity of the Debentures. The options may include arranging for
alternate debt financing in order to fund the pay-out in cash of
the principal amount and/or satisfying the obligation to pay the
amount owing on maturity, in whole or in part, through the issuance
of Common Shares.
Debentureholders may vote on or before 10:00 a.m. (Eastern Time) on May 12, 2023 by following the voting instructions
set out in the Circular. Only Debentureholders of record at the
close of business on the Record Date will be entitled to vote at
the Meeting.
About Crown Capital Partners
(TSX:CRWN)
Founded in 2000 within Crown Life Insurance Company, Crown
Capital Partners is a capital partner to entrepreneurs and growth
businesses mainly operating in the telecommunications
infrastructure, distribution services, and distributed power
markets. We focus on growth industries that require a specialized
capital partner, and we aim to create long-term value by acting as
both a direct investor in operating businesses serving these
markets and as a manager of investment funds for institutional
partners. For additional information, please visit
crowncapital.ca.
FORWARD-LOOKING
STATEMENTS
This news release contains certain "forward looking
statements" and certain "forward looking information" as defined
under applicable Canadian and U.S. securities laws. Forward-looking
statements can generally be identified by the use of
forward-looking terminology such as "may", "will", "expect",
"intend", "estimate", "anticipate", "believe", "continue", "plans"
or similar terminology. Forward-looking statements in this news
release include, but are not limited to, statements, management's
beliefs, expectations or intentions regarding the Debenture
Amendments, the timing and value of potential asset sales, and
management's intended uses of the proceeds of asset sales.
Forward-looking statements are based on forecasts of future
results, estimates of amounts not yet determinable and assumptions
that while believed by management to be reasonable, are inherently
subject to significant business, economic and competitive
uncertainties and contingencies. Forward-looking statements are
subject to various risks and uncertainties concerning the specific
factors identified in the Crown's periodic filings with Canadian
securities regulators. See Crown's
most recent annual information form for a detailed discussion of
the risk factors affecting Crown. In addition, Crown's dividend
policy will be reviewed from time to time in the context of the
Corporation's earnings, financial requirements for its operations,
and other relevant factors and the declaration of a dividend will
always be at the discretion of the board of directors of the
Corporation. Crown undertakes no obligation to update
forward-looking information except as required by applicable law.
Such forward-looking information represents management's best
judgment based on information currently available. No
forward-looking statement can be guaranteed and actual future
results may vary materially. Accordingly, readers are advised not
to place undue reliance on forward-looking statements or
information.
SOURCE Crown Capital Partners Inc.