Gerber Glass Division CEO Sells 200,000 Shares as Part of Boyd Financing Deal

September 8, 2011

Boyd Income Fund, which owns Boyd Autobody and Glass, Gerber Collision and Glass and Gerber National Glass Services, has announced a financing deal that includes the sale of 200,000 shares by Eddie Cheskis, chief executive officer of Gerber's glass division.

The shares are being sold as part of an agreement with Cormark Securities Inc. on behalf of a syndicate of underwriters consisting of Cormark Securities Inc., CIBC World Markets Inc., acting as co-leads and joint bookrunners, and including National Bank Financial and Octagon Capital Corp. The underwriters have agreed to purchase 1,963,231 shares and "offer them to the public by way of short form prospectus."

According to a company statement, in addition to the shares from Cheskis, the deal also includes 1,300,000 trust shares from the company's treasury, along with 463,231 shares being sold from entities under the control or direction of Terry Smith, executive chairman of Boyd Group Income Fund. The shares were sold at a price of $10.75 per unit.

Company officials say the net proceeds of the offering will be used to "reduce debt levels and position the company for future growth and development."

"We believe it is an advantageous time for the [company] to further strengthen its capital structure and balance sheet," says Brock Bulbuck, president and chief executive officer of the Boyd Group. "Raising equity capital now will provide additional financial flexibility and allow us to continue to execute on the Fund's growth strategy into the future. In addition, with Terry [Smith's now planned retirement within the next couple of months, the Fund's equity offering will also provide the opportunity for the disposition of all of Terry's remaining units in a controlled manner without disruption to the market."

According to Boyd, the underwriters also will have the option, exercisable in whole or in part at any time up to 30 days after the closing of the deal, to purchase from the company's treasury up to an additional 195,000 shares for market stabilization purposes and to cover over-allotments, if any. In the event that the option is exercised in its entirety, the aggregate gross proceeds of the deal will be $21.1 million.

The deal is supposed to close around September 27, and is subject to regulatory approval including that of the Toronto Stock Exchange.

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