OTTAWA, April 30 /CNW Telbec/ - Allen-Vanguard Corporation ("Allen-Vanguard" or the "Company") (TSX:VRS) today announced that in accordance with its amended and restated credit facilities entered into on December 29, 2008 (the "New Credit Facility"), the Company has elected to issue 16,496,000 warrants exercisable at $0.2114 per share for a period of five years to certain members of its lending syndicate. All amounts are in Canadian dollars unless otherwise specified.
Under the terms of the New Credit Facility, as announced on December 29, 2008 and as fully disclosed in Note 10 to the Financial Statements of Allen-Vanguard for the year ended September 30, 2008 and Information Circular for its annual and special meeting held in March 2009, certain members of the lending syndicate were entitled to an additional cash payment from the Company based on appreciation in the Company's share price over a five-year period according to a pre-determined formula (the "Share Appreciation Right") unless the Company reduced its long-term debt by US$50 million by April 30, 2009. In lieu of and in complete replacement of such Share Appreciation Right, the Company had the option of issuing additional warrants (the "SAR Replacement Warrants") to certain of the lenders entitling them to acquire up to 10% of the fully diluted common shares of the Company, subject to shareholder approval. At the Company's meeting of shareholders held on March 16, 2009, a majority of disinterested shareholders of the Company approved the creation and issuance of the SAR Replacement Warrants.
The Company clarified that there was no requirement under the terms of the credit facility to repay US$50 million of long-term debt by April 30, 2009; but such a repayment would have avoided the issuance of these SAR Replacement Warrants.
The Company recently announced that it is continuing discussions on an exclusive basis with a U.S. equity investor group in a potential deal that would significantly reduce the Company's long-term debt in a going-private transaction.
Forward looking statements
This press release may contain forward-looking statements, which reflect Allen-Vanguard's current expectations regarding future events, its strategy, expected performance and condition. Forward-looking statements include statements that are predictive in nature, that depend upon or refer to future events or conditions, or that include words such as "expects," "anticipates," "plans," "believes," "estimates" or negative versions thereof and similar expressions. In addition, any statement that may be made concerning future performance, strategies or prospects, and possible future acquisitions or dispositions, is also a forward-looking statement. Forward-looking statements are based on current expectations and projections about future events and are inherently subject to, among other things, risks, uncertainties and assumptions about the Company and economic factors. Forward-looking statements are not promises or guarantees of future performance, and actual events and results could differ materially from those expressed or implied in any forward-looking statements made about the Company. Any number of important factors could contribute to these digressions, including, but not limited to, general economic, political and market factors in North America and internationally, interest and foreign exchange rates, global equity and capital markets, business competition, technological change, changes in government regulations, unexpected judicial or regulatory proceedings, and catastrophic events. We stress that the above-mentioned list of important factors is not exhaustive. We encourage you to consider these and other factors carefully before making any investment decision and we urge you to avoid placing undue reliance on forward-looking statements. Further, you should be aware that the Company disclaims any obligation to publicly update or revise any such forward-looking statements whether as a result of new information, future events or otherwise, prior to the release of the next Management Discussion and Analysis to be released by the Company or except as required by law.
About Allen-Vanguard
Allen-Vanguard Corporation supports the mission of military and homeland security forces around the world with leading proprietary solutions for protection and counter-measures against hazardous devices of all kinds, whether chemical, biological, radiological or explosive (CBRNE), including improvised explosive devices (IEDs) and remotely controlled IEDs (RCIEDs). Allen-Vanguard equipment is in service in more than 120 countries. Products include Electronic Counter-Measures ("ECM") equipment for jamming remote detonation of terrorist devices, specialty security equipment for Explosive Ordnance Disposal ("EOD"), remote intervention robots for hazardous applications, and personal protective wear for use in dealing with explosive and bio-chemical agents. Allen-Vanguard is the developer and/or sole, worldwide licensee of proprietary technologies such as the Med-Eng bomb suit, the DefenderTM and VanguardTM Mk2 bomb disposal robots, and the Universal Containment System and CASCAD Foam system for blast mitigation and decontamination of bio-chemical warfare agents. Professional services encompass counter-IED intelligence, training and advisory services, including the TritonTM Report on terrorist incidents around the world. The Company operates globally through its wholly-owned subsidiaries under the names "Allen-Vanguard", "Med-Eng" and "Hazard Management Solutions". Head office operations are located in Ottawa, Ontario, Canada, with manufacturing operations in Stoney Creek and Pembroke, Ontario; Ogdensburg, New York; Tewkesbury, U.K.; and Cork, Ireland; The Company has professional services operations in Shrivenham, UK, Canada and in the U.S. in Arlington, Virginia, plus sales offices in Canada, the U.S., the U.K. and Asia. Allen-Vanguard's shares are listed on The Toronto Stock Exchange (TSX) under the symbol "VRS".
To learn more about Allen-Vanguard Corporation (TSX: VRS), visit www.allenvanguard.com.
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