CALGARY, ALBERTA--(Marketwired - Oct. 9, 2013) - Aveda Transportation and Energy Services Inc. ("Aveda" or the "Company") (TSX VENTURE:AVE), a leading provider of oilfield hauling services and equipment rentals to the energy industry, today announced that it has entered into an amending agreement pursuant to which Werklund Capital Corporation ("WCC") has granted Aveda the right to unilaterally convert $4.72 million principal amount of convertible debentures registered in the name of WCC (the "Convertible Debentures") into common shares of the Company (the "Common Shares"). Upon electing to convert the Convertible Debentures into Common Shares, Aveda will pay 75% of the remaining interest payable from the conversion date until maturity. As part of its tax planning for fiscal 2013, Aveda intends to convert the Convertible Debentures on or before December 31, 2013. The Convertible Debentures have a term of three years, expire on December 13, 2014, bear interest at a rate of 4% per annum, payable quarterly in arrears, and are convertible into 1,850,980 Common Shares at a price of $2.55 per share.
"Over the last two years, the Aveda team has demonstrated a consistent ability to improve the operational and, consequently, financial performance of the business," said Mr. David Werklund, Executive Chairman of WCC. "We are firm believers in the future growth of Aveda and, on that basis, intend to retain our increased position in the Company post conversion."
"We are seeing an increasingly diverse and robust pipeline of acquisition opportunities become available and are actively evaluating a number of avenues for growth," said Mr. Bharat Mahajan, Vice-President, Finance and Chief Financial Officer of Aveda. "The planned conversion of the Convertible Debentures into Common Shares helps clean up the balance sheet and provides us with improved financial flexibility to pursue and fund these and other growth opportunities both organic and acquisitive."
Pursuant to the terms of the original transaction, upon full conversion, WCC shall have the right to appoint one nominee to Aveda's Board of Directors. Based on public filings, assuming the Convertible Debentures were converted as of the date hereof, after giving effect to the conversion, WCC will own 6,567,335 Common Shares of the Company.
About Aveda Transportation and Energy Services
Aveda provides specialized transportation services and equipment required for the exploration, development and production of petroleum resources in the Western Canadian Sedimentary Basin and in the United States of America principally in and around the states of Texas and Pennsylvania. Transportation services include both the equipment necessary to move the load as well as a trained, professional driver capable of securing, moving and manipulating the load at its origin and destination. Aveda's rental operations include the rental of tanks, mats, pickers, light towers and other equipment necessary for oilfield operations.
Aveda was incorporated in 1994 as a private company to serve the oil and gas industry. In the spring of 2006 the Company went public on the TSX Venture Exchange. Aveda has major operations in Calgary, AB, Slave Lake, AB, Leduc, AB, Sylvan Lake, AB Mineral Wells, TX, Pleasanton, TX, Midland, TX, Buckhannon, WV and Williamsport, PA. Aveda is publicly traded on the TSX Venture Exchange under the symbol AVE. For more information on Aveda please visit www.avedaenergy.com.
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
This news release contains certain forward-looking statements and forward-looking information (collectively referred to herein as "forward-looking statements") within the meaning of applicable Canadian securities laws. All statements other than statements of present or historical fact are forward-looking statements. Forward-looking statements are often, but not always, identified by the use of words such as "anticipate", "achieve", "could", "believe", "plan", "intend", "objective", "continuous", "ongoing", "estimate", "outlook", "expect", "may", "will", "project", "should" or similar words, including negatives thereof, suggesting future outcomes. In particular, this news release contains forward-looking statements relating to: demand for the Company's services and general industry activity level; the anticipated conversion of the Convertible Debentures into Common Shares; the Company's growth opportunities; and expectation to maintain revenue and equipment utilization.
Management of the Company believes the expectations reflected in such forward-looking statements are reasonable as of the date hereof but no assurance can be given that these expectations will prove to be correct and such forward-looking statements should not be unduly relied upon. Various material factors and assumptions are typically applied in drawing conclusions or making the forecasts or projections set out in forward-looking statements. Those material factors and assumptions are based on information currently available to Aveda, including information obtained from third party industry analysts and other third party sources.
Forward-looking statements are not a guarantee of future performance and involve a number of risks and uncertainties, some of which are described herein. Such forward-looking statements necessarily involve known and unknown risks and uncertainties, which may cause Aveda's actual performance and financial results in future periods to differ materially from any projections of future performance or results expressed or implied by such forward-looking statements. These risks and uncertainties include, but are not limited to, the risks identified in Aveda's annual information form and management discussion and analysis for the year ended December 31, 2012 (the "MD&A"). Any forward-looking statements are made as of the date hereof and, except as required by law, Aveda assumes no obligation to publicly update or revise such statements to reflect new information, subsequent or otherwise.