Morneau Sobeco Income Fund Completes $55M Bought Deal Offering

On March 24, 2009, Morneau Sobeco Income Fund (TSX: MSI.UN) completed a public offering, on a bought deal basis, of 6,666,700 trust units at $8.25 per trust unit, for gross proceeds of $55,000,275.

The syndicate of underwriters was led by National Bank Financial Inc., BMO Nesbitt Burns Inc. and TD Securities Inc. and included CIBC World Markets Inc., GMP Securities L.P. and Scotia Capital Inc. The fund granted the underwriters an over-allotment option, exercisable at any time prior to April 23, 2009, to acquire up to an additional 666,670 units of the fund at the issue price of $8.25.

The net proceeds of the offering were used by the fund to prepay a portion of a $75 million vendor take-back note due July 2, 2009 related to the purchase by the fund of Shepell•fgi in June 2008. The fund has agreed to pay Clairvest Group Inc. (the holder of the note) and other vendors of Shepell•fgi an additional $23,230,000 on June 30, 2009, which shall constitute full satisfaction of the fund's obligation under the note. Morneau Sobeco Income Fund is a Canadian-owned provider of human resource consulting and outsourcing services.

Morneau Sobeco was represented by Goodmans LLP in connection with the offering, under the direction of Lynn Korbak, general counsel of Morneau Sobeco. The Goodmans team included Tim Heeney and Keir Hunt (corporate/securities); Jay Feldman (banking) and Carrie Smit and Mark Biderman (tax).

The underwriters were represented by Torys LLP with a team that included Kevin Morris, Patricia Finkelstein, Alison Harnick and Mark Tice (corporate) and Corrado Cardarelli and Andrew Wong (tax).

Lawyer(s)

Keir Hunt Carrie B.E. Smit Corrado Cardarelli Kevin M. Morris Andrew Wong Jay Feldman Alison Harnick Tim Heeney Mark Biderman