Counsel Corporation
TSX : CXS

Counsel Corporation

June 09, 2009 09:00 ET

Counsel Corporation Announces Private Placement of Common Shares

TORONTO, ONTARIO--(Marketwire - June 9, 2009) -

NOT FOR DISTRIBUTION IN THE UNITED STATES OF AMERICA

Counsel Corporation ("Counsel") (TSX:CXS) is pleased to announce that it has received subscriptions for a private placement of common shares and a new series of convertible Series B preferred shares for aggregate proceeds of approximately C$23.6 million. Completion of the transaction is subject to shareholder approval and other conditions typical of transactions of this nature. The proceeds from the private placement will be used to redeem Counsel's outstanding convertible Series A preferred shares, all of which are owned by Sherman Foundation, as well as pay associated costs and fees.

Allan Silber, Chairman and CEO of Counsel, stated "We are very pleased to have received binding subscriptions at $0.75 per share, a significant premium to the recent trading price of Counsel's common shares. We see this as a vote of confidence in the Company's strategy and direction. The funds raised will provide Counsel with more financial flexibility."

Under the proposed private placement, Counsel will issue an aggregate of 16,128,205 common shares for C$0.75 per share and 6,009,616 Series B preferred shares for C$1.92 per share. Sherman Foundation (or its designee) will purchase 5,128,205 of the 16,128,205 common shares and Sherfam Inc. (or its designee) ("Sherfam") will purchase all of the Series B preferred shares.

The Series B preferred shares are convertible into common shares on the basis of C$0.75 per share (or 2.56 common shares for each Series B preferred share), subject to typical anti-dilution adjustments. Holders of Series B preferred shares will be entitled to one vote per Series B preferred share, voting together with the holders of common shares on all matters submitted to a vote of shareholders. The Series B preferred shares are entitled to a cumulative cash dividend of 6% per annum, payable semi-annually. The Series B preferred shares are redeemable at the option of the holder commencing on the first anniversary of their issuance, and are redeemable at the option of Counsel at any time, in each case at their original issue price plus all accrued and unpaid dividends. Counsel has agreed not to issue any common shares (or securities convertible into common shares), other than employee stock options, at less than C$0.75 per share without the approval of Sherfam as long as any Series B preferred shares remain outstanding. Sherfam will have the right to nominate one director of Counsel for so long as it holds the Class B preferred shares.

The shareholders of Counsel will consider and vote on the private placement at a special meeting of shareholders to be held on or about July 22, 2009. Insiders participating in the private placement will not be permitted to vote on the resolution to approve the private placement.

The Toronto Stock Exchange has conditionally approved the private placement, subject to receipt of shareholder approval as described above and satisfaction of certain other standard listing criteria before closing.

About Counsel Corporation

Counsel Corporation (TSX:CXS) is an international asset management firm that actively partners with businesses to achieve shared success and to unlock value through leveraging our relationships, our access to capital and our strategic market experience. For further information, please visit Counsel's website at www.counselcorp.com.

Forward-Looking Statements

The statements made in this release that are not historical facts contain forward-looking information that involves risks and uncertainties. All statements, other than statements of historical facts, which address Counsel's expectations, should be considered as forward-looking statements. Such statements are based on knowledge of the environment in which Counsel currently operates, but because of the factors listed herein, as well as other factors beyond Counsel's control, actual results may differ materially from the expectations expressed in the forward-looking statements. Important factors that may cause actual results to differ from anticipated results include, but are not limited to, obtaining necessary approvals and other risks detailed from time to time in Counsel's securities and other regulatory filings.

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