Student Transportation of America Ltd. Announces Dividend Reinvestment Plan
BARRIE, ON, May 13, 2009 (Canada NewsWire via COMTEX News Network) — /NOT FOR DISTRIBUTION IN THE US OR OVER US WIRE SERVICES/
Student Transportation of America Ltd. (“STA” or the “Company”) (TSX: STB, STB.UN) announced today that it has established a Dividend Reinvestment Plan (the “Plan”) to enable eligible shareholders of STA to reinvest dividends paid on their common shares to additional common shares of the Company. Common shares issued under the Plan will be issued directly from the treasury of STA at a price based on the volume-weighted average of the closing price of the common shares for the five (5) trading days immediately preceding the relevant dividend date, less a 3% discount.
“This Plan is needed today for small and growing companies like ours,” said STA Chairman and Chief Executive Officer Denis J Gallagher. “Reinvesting in our company allows
shareholders to accumulate additional common shares at a discount and allows the
company to use the cash that would have been paid to reinvest in growing our business. It is the best of both worlds for the company and the investor. Some of our largest shareholders have asked that we begin such a plan to take advantage of the many opportunities we have in our growth pipeline. I am pleased the Board acted in such an expedited manner to address this issue, and I hope “value investors” see this as a positive way to increase their holding in the company.”
Beneficial shareholders may enrol in the Plan through the broker or investment dealer through which they hold their shares. Registered shareholders may enrol in the Plan at any time by completing a Plan enrolment form, a copy of which may be obtained by contacting Computershare Trust Company of Canada’s National Customer Contact Centre at 1-800-564-6253 or from the Agent’s website at www.computershare.com. A
shareholder must enrol in the Plan no later than five (5) business days prior to a dividend record date, in order for that cash dividend to be invested under the Plan on the corresponding dividend payment date. Once enrolled, participation in the Plan will continue automatically, unless terminated.
The company said its second largest shareholder, SNCF Participations, has agreed to participate in the reinvestment plan. SNCF Participations’ decision will provide STA with additional cash for the company to use in its growth program.
STA reserves the right to amend, suspend or terminate the Plan at any time, but such action shall have no retroactive effect that would prejudice the interest of the participants under the Plan. All administrative costs associated with the operation of the Plan will be paid by STA.
STA has reserved for issuance with the Toronto Stock
Exchange 3,200,000 additional common shares to accommodate purchases under the Plan.
For more information about the Plan and its terms and conditions visit www.rideSTA.com under Investors -(greater than) Reinvestment Plan.
The securities offered under the Plan have not been and will not be registered under the United States Securities Act of 1933, as amended (the “U.S. Securities Act”), and may not be offered or sold within the United States or to, or for the account or benefit of, U.S. persons except in certain transactions exempt from the registration requirements of the U.S. Securities Act. This release does not constitute an offer for sale of securities in the U.S.
Student Transportation is the fourth-largest provider of school bus transportation services in North America, conducting operations
through local operating subsidiaries. Student
Transportation has become a leading school bus transportation company by aggregating operations through the consolidation of existing providers and conversion of in-house operations and currently operates more than 5,600 school vehicles in North America. For more information, please visit www.rideSTA.com.
Certain statements in this news release are “forward-looking statements” within the meaning of applicable securities laws, which reflect the expectations of management regarding, among other matters, STA’s revenues, expense levels, cost of capital, financial leverage, seasonality, liquidity, profitability of new businesses acquired or secured through bids, borrowing availability, ability to renew or refinance various loan facilities as they become due, ability to execute STA’s growth strategy
and cash distributions, as well as their future
growth, results of operations, performance and business prospects and opportunities. Forward-looking statements generally can be identified by the use of forward-looking terminology such as “may”, “will”, “expect”, “intend”, “estimate”, “anticipate”, “believe”, “should”, “plans” or “continue” or similar expressions, and the negative forms thereof, suggesting future outcomes or events.
These forward-looking statements reflect STA’s current expectations regarding future events and operating performance and speak only as of the date of this news release. Forward-looking statements involve significant risks and uncertainties, should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not, or the times at or by which, such performance or results will be achieved. A number of factors could cause actual results to
differ materially from the results discussed in the forward-looking statements, including, but not limited to, the inability of STA to control its operating expenses, its significant capital expenditures, its reliance on certain key personnel, the possibility that a greater number of its employees will join unions, its acquisition strategy, its inability to achieve our business objectives, significant competition in its industry, rising insurance costs, new governmental laws and regulations, its lack of insurance coverage for certain losses, environmental requirements, seasonality of its industry, its inability to maintain letters of credit and performance bonds and the termination of certain of its contracts for reasons beyond its control. Material factors and assumptions that were relied upon in making the forward-looking statements include the number of Notes acquired pursuant to the
Exchange Offer, contract and customer retention, current and future expense levels, availability of quality acquisition, bid and conversion opportunities, current borrowing availability and financial ratios, as well as current and historical results of operations and performance. Although the forward-looking statements contained in this news release are based upon what STA believes to be reasonable assumptions, investors cannot be assured that actual results will be consistent with these forward-looking statements, and the differences may be material. These forward-looking statements are made as of the date of this news release and STA assumes no obligation to update or revise them to reflect new events or circumstances, other than as required by applicable law.
SOURCE: Student Transportation of America Ltd.
SOURCE: Student Transportation of America ULC
INVESTOR CONTACTS: Student Transportation of America Ltd., Denis J. Gallagher, Chairman and Chief Executive Officer, (732) 280-4200, (732) 280-4213 (FAX); Patrick J. Walker, Executive Vice President and Chief Financial Officer, (732) 280-4200, (732) 280-4213 (FAX); Keith P. Engelbert, Director of Investor Relations, (732) 280-4200, (732) 280-4213 (FAX), Email: kengelbert@rideSTA.com, Website: www.rideSTA.com
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