/NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN
THE UNITED STATES. ANY FAILURE TO COMPLY WITH THIS RESTRICTION MAY
CONSTITUTE A VIOLATION OF U.S. SECURITIES LAW./
WINNIPEG, July 26, 2013 /CNW/ - Exchange Income Corporation (TSX: EIF)
(the "Corporation") announced today that it has amended the terms of
its 7 Year 5.50% Convertible Unsecured Subordinated Debentures due
September 30, 2019 (the "September 2012 Debentures") and its 7 Year
5.35% Convertible Unsecured Subordinated Debentures due March 31, 2020
(the "March 2013 Debentures") to remove the option of the Corporation
to pay cash to the holders of such debentures who have exercised the
conversion privilege attached to such debentures.
The September 2012 Debentures and the March 2013 Debentures are
convertible into Common Shares at the option of the holder. Section
5.12 of each of the trust indentures relating to the September 2012
Debentures (the "September Trust Indenture") and the March 2013
Debentures (the "March Trust Indenture"), respectively, provided for a
"cash conversion option" in favour of the Corporation, which permitted
the Corporation, upon the exercise of the conversion right attaching to
the September 2012 Debentures or the March 2013 Debentures, to pay cash
to the holder of such debentures in lieu of Common Shares.
The other series of debentures of the Corporation do not provide for a
cash conversion option. International Financial Reporting Standards
require that the cash conversion option be treated as an "embedded
derivative". As the Corporation does not intend to exercise the cash
conversion option relating to the September 2012 Debentures and the
March 2013 Debentures, the Corporation determined that accounting for
the cash conversion option as an embedded derivative unnecessarily
complicates the accounting treatment of such debentures in the
Corporation's financial statements.
Pursuant to supplemental trust indentures, the Corporation amended the
September Trust Indenture and the March Trust Indenture to remove the
cash conversion option and other consequential amendments. As the
amendments do not affect the rights of the indenture trustee or the
holders of the September 2012 Debentures or the March 2013 Debentures,
the amendments did not require the approval of the holders of such
debentures. Copies of the supplemental indentures are available for
review at www.sedar.com.
About Exchange Income Corporation
The Corporation is a diversified acquisition-oriented company, focused
on opportunities in the industrial products and transportation sectors
which are ideally suited for public markets except for their size. The
strategy of the Corporation is to invest in profitable,
well-established companies with strong cash flows operating in niche
markets in Canada and/or the United States.
The Corporation is currently operating in two niche business segments:
aviation and specialty manufacturing. The aviation segment consists of
the operations by Perimeter Aviation, Keewatin Air, Calm Air
International, Bearskin Lake Air Service, Custom Helicopters and
Regional One, and the specialty manufacturing segment consists of the
operations by Jasper Tank, Overlanders Manufacturing, Water Blast
Manufacturing, Stainless Fabrication and WesTower Communications. For
more information on the Corporation, please visit www.ExchangeIncomeCorp.ca.
Additional information relating to the Corporation, including all public
filings, is available on SEDAR.
SOURCE: Exchange Income Corporation
