Vitran Corporation Inc. announces agreement to sell common shares and modifies current debt arrangement
TORONTO, Sept. 17 /PRNewswire-FirstCall/ - Vitran Corporation Inc. (NASDAQ: VTNC, TSX: VTN) ("Vitran" or the "Company"), a North American transportation and logistics firm, today announced that it has agreed to sell approximately 2.7 million shares of common stock at a price of US$8.50 per share to certain qualified investors (the "Offering"). The net proceeds to the Company, after payment of costs and expenses associated with the Offering, are expected to be approximately US$21.4 million. From these net proceeds, the Company intends to permanently reduce the outstanding amount of its syndicated term debt by US$7.5 million. The remainder of the net proceeds will be used to pay down revolving debt. The repayment of the revolving debt will increase the Company's unused debt capacity and give the Company added flexibility to execute its operating and capital initiatives. The Offering is subject to the satisfaction of customary closing conditions and is anticipated to close on or about September 21, 2009.
The shares to be sold under the Offering have not been registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements. In conjunction with the sale of the shares, the Company intends to file a Registration Statement on Form S-3 to facilitate the resale of such shares from time to time by the new investors. This press release shall not constitute an offer to sell or the solicitation of an offer to buy any of the shares.
Amendment to Credit Agreement
Additionally, the Company has signed an amendment to its syndicated credit agreement. Under the amendment, the syndicate, led by JPMorgan Chase Bank, and Vitran have agreed to a number of changes to its banking agreement, the most significant of which are:
- more favorable financial covenants commencing with the period ending
September 30, 2009 through to the period ending December 31, 2010
- interest rate spreads for LIBOR and Canadian BA-based loans of 500
basis points at maximum leverage ratio; and
- reaffirmation of debt maturity to July 31, 2012.
The effectiveness of the amendment is subject to certain conditions, including receipt by the Company of minimum proceeds of US$20.0 million upon completion of the Offering.
TORONTO, Sept. 17 /PRNewswire-FirstCall/ - Vitran Corporation Inc. (NASDAQ: VTNC, TSX: VTN) ("Vitran" or the "Company"), a North American transportation and logistics firm, today announced that it has agreed to sell approximately 2.7 million shares of common stock at a price of US$8.50 per share to certain qualified investors (the "Offering"). The net proceeds to the Company, after payment of costs and expenses associated with the Offering, are expected to be approximately US$21.4 million. From these net proceeds, the Company intends to permanently reduce the outstanding amount of its syndicated term debt by US$7.5 million. The remainder of the net proceeds will be used to pay down revolving debt. The repayment of the revolving debt will increase the Company's unused debt capacity and give the Company added flexibility to execute its operating and capital initiatives. The Offering is subject to the satisfaction of customary closing conditions and is anticipated to close on or about September 21, 2009.
The shares to be sold under the Offering have not been registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements. In conjunction with the sale of the shares, the Company intends to file a Registration Statement on Form S-3 to facilitate the resale of such shares from time to time by the new investors. This press release shall not constitute an offer to sell or the solicitation of an offer to buy any of the shares.
Amendment to Credit Agreement
Additionally, the Company has signed an amendment to its syndicated credit agreement. Under the amendment, the syndicate, led by JPMorgan Chase Bank, and Vitran have agreed to a number of changes to its banking agreement, the most significant of which are:
- more favorable financial covenants commencing with the period ending
September 30, 2009 through to the period ending December 31, 2010
- interest rate spreads for LIBOR and Canadian BA-based loans of 500
basis points at maximum leverage ratio; and
- reaffirmation of debt maturity to July 31, 2012.
The effectiveness of the amendment is subject to certain conditions, including receipt by the Company of minimum proceeds of US$20.0 million upon completion of the Offering.