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2009-06-08 23:30:35 CEST 2009-06-08 23:31:43 CEST REGULATED INFORMATION Clearwater Finance Inc. - Company AnnouncementCLEARWATER REPORTS AGREEMENTS FOR SUCCESSFUL REFINANCING OF MATURING DEBT FACILTIESAttention Business/Financial Editors CLEARWATER REPORTS AGREEMENTS FOR SUCCESSFUL REFINANCING OF MATURING DEBT FACILTIES /Not for distribution to United States or for dissemination in the United States / HALIFAX, June 8/CNW/ - (TSX:CLR.UN, CLR.DB, CLR.DB.A): § Management reaches agreement for successful refinancing of maturing debt facilities with $60 million revolving asset backed debt facility and $59.5 million in new term debt Today, Clearwater Seafoods Limited Partnership (“Clearwater”) reported that working with GE Capital Markets (Canada) Ltd. and GE Capital Markets, Inc. (collectively, “GECM”) it has received commitments for the refinancing of its near-term debt facilities. The new $60 million revolving debt facility has a three-year term and will be fully underwritten byGE Capital in Canada. The facility will bear interest at market rates, which will be set at closing with interest to be paid monthly. The facility is secured by a first charge on trade receivables and inventory. Clearwater previously announced $57 million in new term debt on June 1, 2009. This debt facility has been increased to $59.5 million based on an additional commitment from Export Development Canada (“EDC”) who has approved a total loan of $15 million versus the $12.5 million previously announced. This facility also includes GE Capital, The Business Development Bank of Canada (“BDC”), and the Province of Nova Scotia, through the Industrial Expansion Fund. The facility will bear interest at market rates, which will be set at closing. Closing of both these new facilities are conditional upon certain conditions precedent being met and including completion of GE Capital's final due diligence and the negotiation, execution and delivery of definitive documentation. These loan commitments expire on June 26, 2009. The facilities being repaid, which approximate CDN $93 million as of June 8, 2009 will be settled on or before June 15, 2009 with the proceeds from the above facilities. The outgoing lenders have granted an extension from June 8, 2009 to June 15, 2009 to provide additional time to finalize documentation and close the new facilities. Both of these new facilities contain positive covenants, including without limitation, minimum earnings before interest, taxes, depreciation and amortization levels to debt levels and additional negative covenants, including without limitation, restrictions on capital spending and asset dispositions, restrictions on incurring additional indebtedness and limitation on the payment of distributions. There are also provisions for cash sweeps that, depending on annual cash flows, could result in additional payments being made on the term debt. Colin MacDonald, Chairman and Chief Executive Officer commented “The completion of this agreement in what has been one of the toughest credit markets in recent history speaks to the ongoing strength of Clearwater's business model. We wish to express our appreciation to GE Capital in Canada for their commitment to the organization and for underwriting the working capital line and leading the syndicate in the term debt component. We again would like to express our appreciation for the leadership shown by the Province of Nova Scotia, BDC and EDC.” "In a period where the credit markets remain challenged, we are pleased to provide Clearwater a solid source of financing flexibility for their ongoing operations through our asset-based credit facility. Where refinancing is top of mind for many Canadian companies, having credit available is essential and GE Capital's ability to provide it at this time illustrates its financial strength and commitment to the Canadian market," commented Ellis Gaston, Managing Director for Corporate Finance at GE Capital in Canada. Mr. MacDonald concluded, “We will build on this success over the next several years by focusing on reducing our leverage and the absolute amount of our debt. This will come from a combination of improved earnings levels, which will improve trailing EBITDA levels, and from using the positive cash flow of the business to reduce debt.” About Clearwater Clearwater has operations employing more than 1,200 employees throughout Nova Scotia and is recognized for its consistent quality, wide diversity and reliable delivery of premium seafood, including scallops, lobster, clams, coldwater shrimp, crab and ground fish. Since its' founding in 1976, Clearwater has invested in science, people, technology, resource ownership and resource management to preserve and grow its seafood resource. This commitment has allowed it to remain a leader in the global seafood market. For further information: Robert Wight, Chief Financial Officer, Clearwater, (902) 457-2369; Tyrone Cotie, Director of Corporate Finance and Investor Relations, Clearwater, (902) 457-8181. |
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