/NOT FOR DISTRIBUTION IN THE UNITED STATES OR OVER UNITED STATES NEWS WIRE SERVICES/
BOUCHERVILLE, QC, Aug. 22, 2016 /CNW Telbec/ - Colabor Group Inc.
(TSX: GCL) ("Colabor" or the "Corporation") announces
that, as part of meetings held earlier today in connection with the
previously announced proposed recapitalization transactions to
reduce Colabor's indebtedness and significantly enhance the
Corporation's capital structure (the "Recapitalization
Transactions"), the holders
(the "Debentureholders") of its 5.70% Convertible
Unsecured Subordinated Debentures due April
30, 2017 (the "Convertible Debentures") have
approved the proposed amendments to the Convertible Debentures (the
"Debenture Amendments") and its shareholders have approved
the proposed $50 million rights
offering (the "Rights Offering"), including the
offering price under the Rights Offering.
Debentureholders holding more than 97.75% of the principal
amount of the Convertible Debentures present or represented at the
meeting have approved the Debenture Amendments and shareholders
holding more than 96.79% of the issued and outstanding shares of
Colabor (the "Common Shares") present or represented at
the meeting have approved the Rights Offering. The Debenture
Amendments, if completed, will have the effect of extending the
maturity date for a 5-year period from the closing date of the
Recapitalization Transactions, to increase the interest rate from
5.70% to 6.00% (as of October 31,
2016) and to reduce the conversion price from $16.85 to $2.50 per
Common Share. Under the Rights Offering, each holder of record of
Common Shares as of a record date to be determined in connection
with the Rights Offering will receive transferable rights (each, a
"Right") to subscribe for an aggregate number of Common
Shares for an aggregate amount of $50
million.
Colabor intends to file a preliminary short form prospectus with
the securities regulatory authorities in each of the provinces of
Canada in connection with the
Rights Offering which will contain further details regarding the
Rights Offering in the coming days. The completion of the
Recapitalization Transactions is subject to customary closing
conditions, including the concurrent effectiveness of the
previously announced amendments to the Corporation's subordinated
loan and to the senior credit facilities of the Corporation. If all
closing conditions are satisfied (or waived), closing is currently
expected to occur in October 2016,
after completion of the Rights Offering, and in any event no later
than November 30, 2016.
This news release shall not constitute an offer to sell or
the solicitation of an offer to buy, nor shall there be any sale of
securities in the United States or
in any province, state or jurisdiction in which such offer,
solicitation or sale would be unlawful prior to the registration or
qualification under the securities laws of any such province, state
or jurisdiction. The securities referenced herein may not be
offered or sold in the United
States except in transaction exempt from or not subject to
the registration requirements of the United States Securities Act
of 1933, as amended, and applicable state securities laws.
Forward-looking statements
Certain statements included herein constitute "forward-looking
statements". All statements included in this press release that
address future events, conditions or results of operations,
including in respect of the Recapitalization Transactions, its
realization and its potential consequences and benefits, the timing
of the completion of the Rights Offering, the filing and content of
the prospectus, are forward-looking statements. These
forward-looking statements can be identified by the use of
forward-looking words such as "may", "should", "will", "could",
"expect", "intend", "plan", "estimate", "anticipate", "believe",
"future" or "continue" or the negative forms thereof or similar
variations. These forward-looking statements are based on certain
assumptions and analyses made by management in light of their
experiences and their perception of historical trends, current
conditions and expected future developments, as well as other
factors they believe are appropriate in the circumstances. These
statements are subject to risks, uncertainties and assumptions,
including risks related to the successful completion of the
Recapitalization Transactions, timing of the completion of the
Recapitalization Transactions and that the Corporation,
Debentureholders, shareholders and/or other stakeholders may not
realize the anticipated benefits of the Recapitalization
Transactions and other risks, such as the risk of dilution for
existing shareholders, including those mentioned in the
Corporation's management information circulars dated July 25, 2016 in connection with the meetings of
Debentureholders and shareholders and annual information form,
which can be found under its profile on SEDAR (www.sedar.com) and
risks relating to the failure to obtain any required regulatory
approvals. Many of such risks and uncertainties are outside the
control of the Corporation and could cause actual results to differ
materially from those expressed or implied by such forward-looking
statements. In making such forward-looking statements, management
has relied upon a number of material factors and assumptions,
including with respect to general economic and financial
conditions, interest rates, exchange rates, equity and debt
markets, business competition, changes in government regulations or
in tax laws, acts and omissions of third parties and the ability of
the Corporation to obtain approval for, and carry on, the
Recapitalization Transactions. Such forward-looking statements
should, therefore, be construed in light of such factors and
assumptions. All forward-looking statements are expressly qualified
in their entirety by the cautionary statements set forth above. The
Corporation is under no obligation, and expressly disclaims any
intention or obligation, to update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise, except as expressly required by applicable law.
ABOUT COLABOR
Colabor is a wholesaler and distributor
of food and non-food products serving the foodservice market
(cafeterias, restaurants, hotels, restaurant chains, etc.) in
Québec, Ontario and the Atlantic
provinces, as well as the retail market (grocery stores,
convenience stores, etc.).
SOURCE Colabor