Crown Capital Partners gets OK to amend 6% convertibles due 2023

By William Gullotti

Buffalo, N.Y., May 16 – Crown Capital Partners Inc. announced it received approval from holders of its 6% convertible subordinated debentures due June 30, 2023 to amend some terms of the debentures in a press release on Tuesday.

The amendments were voted on as a package and approved at a special debentureholder meeting at the company’s offices in Toronto on May 16, consisting of the following:

• Extending the maturity date of the debentures to Dec. 31, 2024 from June 30, 2023;

• Amending the interest rate to 10% from 6%, effective July 1;

• Removing the conversion right of the debentureholders; and

• Removing the right of the company to repay the principal amount of the debentures in common shares on the new maturity date or any redemption date.

As previously reported, the company will pay a consent fee of $10 per $1,000 principal amount to holders of record as of April 6 that voted in favor of the amendments.

The amendments were only to become effective if passed by an extraordinary resolution of holders of at least 66 2/3% of the principal amount of the debentures present at the meeting.

According to the press release, debentureholders owning 59.275% of the outstanding total voted, with 98.178% voting in favor.

The effective date of the approved amendments will be June 30, as initially indicated.

The amendments have been conditionally approved by the Toronto Stock Exchange but remain subject to final approval.

The amendments are intended to give Crown additional short-term capital while it completes sales of assets, which should provide sufficient funds to repay the debentures in cash. Provided that the amendments receive final approval from the Toronto Exchange, the company intends to use some or all of the proceeds of those asset sales to fund the redemption of some or all of the debentures as soon as those proceeds become available.

The specialty finance company is based in Calgary, Alta.

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