Chemtrade Logistics Income Fund Completes $75 Million Public Offering of Convertible Debentures Bought Deal and Announces Partial Redemption of 5.25% Convertible Unsecured Subordinated Debentures

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TORONTO, Aug. 26, 2020 /CNW/ - Chemtrade Logistics Income Fund (TSX: CHE.UN) ("Chemtrade" or the "Fund") announced today that it has completed its previously-announced public offering (the "Offering") of $75 million principal amount of 8.50% convertible unsecured subordinated debentures (the "Debentures") due September 30, 2025. The Debentures are convertible, at the option of the holder, into trust units of Chemtrade at a conversion price of $7.35 per unit. The Debentures were sold to a syndicate of underwriters led by BMO Capital Markets, CIBC Capital Markets, National Bank Financial Inc., RBC Capital Markets, Scotiabank, and TD Securities Inc. on a bought deal basis. In addition, Chemtrade has granted the underwriters an over-allotment option to purchase up to an additional $11.25 million aggregate principal amount of Debentures at the same price, which can be exercised in whole or in part at any time for a period of 30 days following the closing of the Offering.

Chemtrade also announced today that it will redeem on September 29, 2020 (the "Redemption Date") $100.0 million principal amount of its 5.25% convertible unsecured subordinated debentures due June 30, 2021 (the "2021 Debentures") in accordance with the terms of the trust indenture, as amended and supplemented by supplemental indentures thereto (collectively, the "Indenture"), pursuant to which they were issued. On the Redemption Date, holders of 2021 Debentures will receive approximately $1,013.0532 for each $1,000 principal amount of 2021 Debentures, being equal to $1,000, plus all accrued and unpaid interest thereon to but excluding the Redemption Date. The 2021 Debentures that are redeemed will cease to bear interest from and after the Redemption Date.

The record date for determining the holders whose 2021 Debentures are to be redeemed shall be September 25, 2020. The 2021 Debentures shall be redeemed on a pro rata basis to the nearest multiple of $1,000 in accordance with the principal amount of the 2021 Debentures registered in the name of each holder, or in such other manner as deemed equitable, subject to any applicable regulatory approvals.

Formal notice of redemption is being delivered to the holders of the 2021 Debentures today in accordance with the terms of the Indenture. The aggregate amount of 2021 Debentures outstanding as of the date hereof is $126.5 million. Following the partial redemption, $26.5 million aggregate principal amount of the 2021 Debentures are expected to remain outstanding and shall continue to be subject to the terms of the Indenture.

Chemtrade will use the net proceeds of the Offering, together with borrowings of up to $30 million from the Fund's existing credit agreement (the "Credit Facility"), to fund the partial redemption of the 2021 Debentures and, pending any such use, the net proceeds will be used to repay indebtedness under the Credit Facility.

The securities offered 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. This press release shall not constitute an offer to sell or the solicitation of an offer to buy securities in the United States, nor shall there be any offer, solicitation or sale of the securities in any jurisdiction in which such offer, solicitation or sale would be unlawful.

About Chemtrade

Chemtrade operates a diversified business providing industrial chemicals and services to customers in North America and around the world. Chemtrade is one of North America's largest suppliers of sulphuric acid, spent acid processing services, inorganic coagulants for water treatment, sodium chlorate, sodium nitrite, sodium hydrosulphite, and phosphorus pentasulphide. Chemtrade is a leading regional supplier of sulphur, chlor-alkali products, liquid sulphur dioxide, potassium chloride, and zinc oxide. Additionally, Chemtrade provides industrial services such as processing by-products and waste streams.

Caution Regarding Forward-Looking Statements

Certain statements contained in this news release constitute forward-looking information within the meaning of certain securities laws, including the Securities Act (Ontario). Forward-looking information can be generally identified by the use of words such as "anticipate", "continue", "estimate", "expect", "expected", "intend", "may", "will", "project", "plan", "should", "believe" and similar expressions. Specifically, forward-looking information in this news release include statements respecting certain future expectations about the Fund's intended use of the proceeds, including the partial redemption of 2021 Debentures and anticipated borrowings from the Credit Facility to fund such redemption. Forward-looking statements in this news release describe the expectations of the Fund and its subsidiaries as of the date hereof.

These statements are based on assumptions and involve known and unknown risks, uncertainties and other factors that may cause actual results or events to differ materially from those anticipated in such forward-looking statements for a variety of reasons, including without limitation the risks and uncertainties detailed under the "Risk Factors" section of the Fund's latest Annual Information Form and the "Risks and Uncertainties" section of the Fund's most recent Management's Discussion & Analysis.

Although the Fund believes the expectations reflected in these forward-looking statements and the assumptions upon which they are based are reasonable, no assurance can be given that actual results will be consistent with such forward-looking statements, and they should not be unduly relied upon. With respect to the forward-looking statements contained in this news release, the Fund has made assumptions regarding: the timing and completion of the partial redemption of the 2021 Debentures; there being no significant disruptions affecting the operations of the Fund and its subsidiaries, whether due to labour disruptions, supply disruptions, power disruptions, transportation disruptions, damage to equipment or otherwise; the timely receipt of required regulatory approvals; and global economic performance.

Except as required by law, the Fund does not undertake to update or revise any forward-looking statements, whether as a result of new information, future events or for any other reason. The forward-looking information contained herein are expressly qualified in their entirety by this cautionary statement.

Further information can be found in the disclosure documents filed by the Fund with the securities regulatory authorities, available at www.sedar.com.

SOURCE Chemtrade Logistics Income Fund

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