Railpower Technologies Corp.
TSX : P

Railpower Technologies Corp.

October 24, 2005 08:09 ET

RailPower Technologies Corp. Announces CAD$50 Million 'Bought Deal' Financing

VANCOUVER, BRITISH COLUMBIA--(CCNMatthews - Oct. 24, 2005) -

NOT FOR DISSEMINATION IN THE UNITED STATES OR DISTRIBUTION TO UNITED STATES WIRE SERVICES

RailPower Technologies Corp. (TSX:P) announced today that it has entered into a bought deal financing agreement with Sprott Securities Inc.

Under the agreement, RailPower has agreed to sell 9,345,795 common shares from treasury on a "bought deal" basis to a syndicate of underwriters led by Sprott Securities and including National Bank Financial Inc. and Paradigm Capital Inc. at a price of CAD$5.35 per common share for gross proceeds of CAD$50,000,003.

In addition, the Company has granted the underwriters the option to purchase up to an additional $10,000,006 worth of common shares (1,869,160) on the same terms, exercisable at any time prior to the filing of the final prospectus relating to the offering.

Net proceeds of the offering will be used to fund working capital and additional expenses relating to existing and anticipated orders; to fund European expansion; to fund expansion of RailPower's service and maintenance business; and general working capital and general corporate purposes.

The common shares to be issued under this offering will be offered by way of a short form prospectus in all the provinces of Canada. The offering is scheduled to close on or about November 15, 2005 and is subject to certain conditions including but not limited to, the receipt of all necessary approvals including the approval of the Toronto Stock Exchange and the securities regulatory authorities.

The common shares have not, and will not be registered under the US Securities Act of 1933 (the 'Securities Act') and may not be offered or sold within the United States or to, or for the account of benefit of, US persons except in certain transactions exempt from the registration requirements of the Securities Act. This news release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of the securities in any state in which such offer, solicitation or sale would be unlawful.

RailPower has its headquarters in North Vancouver, British Columbia. Its main engineering office is in Erie, Pennsylvania. It produces low emission, high performance, yard and road switcher locomotives at a number of locations in Canada and the US.

Contact Information

  • RailPower Technologies Corp.
    Donna Cejalvo
    Communications
    (814) 835-2212 ext 203
    or
    RailPower Technologies Corp.
    Simon Clarke
    Executive Vice President
    (604) 904-0085 ext 206