July 05, 2005 08:30 ET

Eveready Closes Acquisition of Oilfield Services Company

EDMONTON, ALBERTA--(CCNMatthews - July 5, 2005) - Eveready Income Fund (TSX:EIS.UN) ("Eveready") announced today that it has closed its previously announced acquisition of 100% of the issued and outstanding shares of Allstar Oilfield Services Ltd. ("Allstar") and related assets used in the business of Allstar but not previously owned by Allstar (the "Related Assets"). Allstar is based in Lloydminster, Alberta, and provides a broad range of oilfield services to the energy sector including vacuum truck, pressure testing, flush-by, and hydro excavation services.

The acquisition was completed by a wholly owned subsidiary limited partnership of Eveready on July 4, 2005 with an effective date of July 1, 2005 and was completed pursuant to a purchase agreement dated June 24, 2005. This was an arms length transaction.

The purchase agreement contemplates that the final purchase price payable for Allstar and the Related Assets will be based on the earnings of Allstar and the Related Assets over the next 12 months, such earnings and final purchase price to be determined and paid not later than October 31, 2006. However, as required by the purchase agreement, the minimum purchase price of approximately $6,090,000 less assumed debt of approximately $4,133,517 was satisfied on closing via the issuance of an aggregate of 454,996 Units of the Fund for aggregate consideration of $1,956,482. When the final purchase price is determined, the additional amount owing, if any, will be satisfied via the issuance of up to an additional 527,562 Units for aggregate consideration of up to $2,268,516 with any outstanding balance over that amount to be paid in cash.

Rod Marlin, Eveready's President and Chief Executive Officer of Eveready, commented "We are very pleased with the acquisition of Allstar. The acquisition is an exceptional fit allowing Eveready to expand into the Lloydminster area."

Eveready Income Fund is one of Canada's leading providers of industrial cleaning, oilfield, and environmental services to the energy, resource, and manufacturing sectors. The Units of Eveready trade on the Toronto Stock Exchange under the trading symbol "EIS.UN".

This press release contains forward-looking statements subject to various risk factors and uncertainties, which may cause the actual results, performances or achievements of Eveready to be materially different from any future results, performances or achievements expressed or implied by such forward-looking statements. Such factors include, but are not limited to, fluctuations in the market for oil and gas and related products and services, political and economic conditions, the demand for services provided by Eveready, industry competition and Eveready's ability to attract and retain both customers and key personnel.

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