By Angela McDaniels
Tacoma, Wash., Feb. 11 - TimberWest Forest Corp. has completed its private placement of C$100 million 9% five-year convertible debentures with British Columbia Investment Management Corp., according to a company news release.
Plans for the placement were announced Dec. 15.
The debentures will mature on Feb. 11, 2014. The maturity date was initially set for Feb. 27, 2009 but was automatically extended because the company was able to amend its credit facilities prior to settlement.
The debentures, including interest, are convertible into stapled units at a conversion price of C$3.50.
The debentures are callable at par after three years, provided that the weighted average trading price for the stapled units is at least double the conversion price for 30 consecutive trading days.
Rights offering
The company also completed its previously announced rights offering under which existing stapled unitholders could subscribe for up to C$50 million of 9% convertible debentures with terms similar to those sold in the placement.
Unitholders received one right for each stapled unit held. For every 155.53088 rights held, the holder was entitled to subscribe for C$100 of debentures.
The company said it issued the full C$50 million of convertibles in the rights offering, which was oversubscribed by 53.2%.
Proceeds from the placement and rights offering will be used to repay C$75 million of debt under the company's bank credit facilities. The remainder will be used to reduce debt under the company's revolving credit facilities.
Successful completion of the private placement and rights offering was a condition to an amendment made to the company's credit facility. The company said the amendment revised covenants to avoid future potential events of default.
Vancouver, B.C.-based TimberWest is a land management company.
| Issuer: | TimberWest Forest Corp.
|
| Issue: | Convertible debentures, convertible into staple units
|
| Amount: | C$100 million
|
| Maturity: | Feb. 11, 2014
|
| Coupon: | 9%
|
| Price: | Par
|
| Yield: | 9%
|
| Conversion price: | C$3.50
|
| Call option: | At par after three years, subject to stapled units' price being at least double the conversion price for 30 days
|
| Warrants: | No
|
| Investor: | British Columbia Investment Management Corp.
|
| Pricing date: | Dec. 15
|
| Settlement date: | Feb. 11
|
| Stock symbol: | Toronto: TWF.UN
|
| Stock price: | C$4.47 at close Dec. 12
|
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