ONCAP

ONCAP

March 31, 2006 18:59 ET

ONCAP Successfully Completes $19.75 Million Recapitalization of Environmental Management Solutions Inc.

TORONTO, ONTARIO--(CCNMatthews - March 31, 2006) -

All amounts in Canadian dollars unless otherwise stated

ONCAP II L.P. and its affiliates today announced the successful completion of a private placement transaction with Environmental Management Solutions Inc. ("EMS") pursuant to which ONCAP provided $19.75 million of financing to EMS. Pursuant to the ONCAP Financing, ONCAP acquired 20,342.5 Units issued by EMS with each Unit being comprised of (i) 500 series 1 preferred shares and (ii) $950 principal amount of a 5% secured convertible debenture. The 20,342.5 Units issued by EMS represent a holding of 10,171,250 series 1 voting preferred shares and $19,325,375.00 in principal amount of secured convertible debentures, in each case representing approximately 98.78% of the issued and outstanding series 1 voting preferred shares and convertible debentures.

The preferred shares are fully voting and represent approximately 21% of all of the votes attaching to all issued and outstanding voting securities of the Company. The preferred shares and convertible debentures as a Unit are convertible into EMS common shares at a conversion price of $0.323 per common share (subject to certain adjustments). If converted, ONCAP will own at least 62% of the Company's common shares.

The Units are being purchased for investment purposes. While it has no current intention to do so, ONCAP may acquire additional securities in the Company. EMS has agreed to grant ONCAP the right of first offer to acquire up to $10 million in securities in the event that EMS, or any of its subsidiaries, intends to raise additional financing through the issuance of shares in the capital of EMS or a subsidiary or securities that are convertible into shares in the capital of EMS or a subsidiary. ONCAP may also sell securities it holds in the market or in privately negotiated transactions to one or more persons.

This press release is being issued as required under the early warning requirements of applicable securities laws.

About ONCAP:

ONCAP is a leading private-equity firm focused on building value with North American small and mid-sized companies in partnership with their management teams. ONCAP is an affiliate of one of Canada's largest corporations, Onex Corporation ("Onex"), and manages capital from Onex and certain institutional and individual investors. To date, ONCAP has invested in eight platform companies, completed a total of 22 acquisitions and created significant equity value in each of its investments.

Contact Information

  • ONCAP
    Greg Baylin
    (416) 214-4300