Killam Properties Inc.

Killam Properties Inc.

May 12, 2011 07:34 ET

Killam Announces Public Offering of $40.0 Million of Convertible Unsecured Debentures

HALIFAX, NOVA SCOTIA--(Marketwire - May 12, 2011) -


Killam Properties Inc. ("Killam") (TSX:KMP)(TSX:KMP.DB) is pleased to announce that it has reached an agreement with a syndicate of underwriters led by RBC Capital Markets to issue to the public, subject to regulatory approval, on a bought deal basis, $40 million aggregate principal amount of 5.45% convertible unsecured subordinated debentures due June 30, 2018 (the "Debentures"). The Debentures are convertible, at the option of the holder, into common shares of Killam at $14.60 per share. In addition, Killam has granted the Underwriters an over-allotment option for the purposes of covering the Underwriters' over-allocation portion for an additional $6.0 million aggregate principal amount of Debentures, exercisable up to 30 days after closing of the offering.

Killam intends to use the net proceeds from this offering to fund future property acquisitions (including partially funding the recently announced six building, 310-unit apartment portfolio in Fredericton, NB) and development activities, to repay indebtedness, and for general corporate purposes.

Killam will, within the next few days, file with the securities commissions and other similar regulatory authorities in each of the provinces of Canada, excluding Quebec, a preliminary short form prospectus relating to the issuance of the Debentures. Closing of the offering is expected to take place on or about June 2, 2011.

This press release is not an offering of securities for sale in the United States. The Debentures being offered have not been and will not be registered under the United States Securities Act of 1933, as amended, and state securities laws. Accordingly, the Debentures may not be offered or sold in the United States absent registration or an exemption from the registration requirements of that Act.

Corporate Profile

Killam Properties Inc, based in Halifax, Nova Scotia, is one of Canada's largest residential landlords, owning and operating multi-family apartments and manufactured home communities.

Note: The Toronto Stock Exchange has neither approved nor disapproved of the information contained herein. Certain statements in this report may constitute forward-looking statements relating to the offering, our operations and the environment in which we operate, which are based on our expectations, estimates, forecast and projections, which we believe are reasonable as of the current date. Such forward-looking statements involve risks, uncertainties and other factors which may cause actual results, performance or achievements of Killam to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. For more exhaustive information on these risks and uncertainties, you should refer to our most recently filed annual information form which is available at Readers, therefore, should not place undue reliance on any such forward-looking statements. Further, a forward-looking statement speaks only as of the date on which such statement is made and should not be relied upon as of any other date. Other than as required by law, Killam does not undertake to update any of such forward-looking statements.

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