PRESS RELEASE Symbol: EIS.UN (TSX)
FOR IMMEDIATE DISTRIBUTION July 12, 2006
EVEREADY INCOME FUND TO SOLIDIFY ITS POSITION AS THE LEADING OILFIELD
SERVICES PROVIDER IN EAST-CENTRAL ALBERTA AND WESTERN SASKATCHEWAN
Edmonton, Alberta, Canada – Eveready Income Fund (“Eveready” or the “Fund”) announces that it has
entered into a letter of intent (the “Letter of Intent”) to acquire 100% of the issued and outstanding shares of
the Diversified Pressure Services group of companies (“Diversified”). Based in Macklin, Saskatchewan,
Diversified provides a wide range of oilfield services to the oil and gas industry including vacuum truck,
pressure testing, hot oiling, tank truck, steam cleaning, and flush-by services.
Beginning with the acquisition of Winterhawk Enterprises (Provost) Ltd. in November 2004, Eveready has
been significantly expanding its service capabilities in east-central Alberta and western Saskatchewan. This
growth has been achieved through both organic growth and through the completion of seven additional
business acquisitions in 2005 and the first six months of 2006.
“This acquisition is a culmination of our tremendous growth in this region over the past year and a half,”
comments Rod Marlin, Eveready’s President and Chief Executive Officer. “We believe that this growth has
established Winterhawk as the preferred oilfield services provider in this region and we plan to continue to
build on this market position in the future.”
The Letter of Intent contemplates a purchase price of approximately $7.5 million, payable through a
combination of: (i) $3.75 million in cash and (ii) $3.75 million in exchangeable limited partnership (“Rollover
LP”) units issued at a deemed price of $6.74 per Rollover LP unit. Eveready estimates this acquisition could
generate EBITDA of approximately $2.0 to $2.5 million on an annual basis.
The Rollover LP units are units of a subsidiary limited partnership of the Fund and are designed to be, to the
greatest extent practicable, the economic equivalent of Fund units. Rollover LP units are non-transferable
(except to certain permitted assigns) and the holders thereof are entitled to receive distributions on a per unit
basis equivalent to holders of Fund units. Rollover LP units are exchangeable into Fund units at any time.
The vendors have also agreed to participate approximately 67% of their Rollover LP units in Eveready’s
Principal Unitholder Agreement. Under this agreement, each Principal Unitholder has agreed to not sell more
than 10% of such Principal Unitholder’s units in any one year and to reinvest in the distribution reinvestment
plan of the Fund 100% of the distributions received on such Principal Unitholder’s units until March 31, 2010.
As of June 30, 2006, approximately 34% of the Fund’s outstanding Fund units and Rollover LP units were
subject to the Principal Unitholder Agreement.
Completion of the proposed acquisition is subject to a number of conditions, including but not limited to, the
completion of satisfactory due diligence by Eveready. Completion of the proposed acquisition is also subject
to the receipt of any required regulatory approvals, including but not limited to, the approval of the Toronto
Stock Exchange. Assuming that all of the conditions are satisfied, Eveready anticipates the proposed
acquisition will be effective September 1, 2006.
Eveready is a growth oriented income fund that provides industrial and oilfield services; health, safety, and
environmental services; and oilfield equipment rental services to the energy, resource, and manufacturing
sectors. The Units of Eveready trade on the Toronto Stock Exchange under the trading symbol “EIS.UN”.
EBITDA is a supplemental earnings measure that does not have any standardized meaning prescribed by
Canadian GAAP and may not be comparable to EBITDA calculated by other funds or entities. EBITDA is a
useful supplemental measure as it provides an indication of the financial results generated by Eveready’s
principal business activities prior to consideration of how these activities are financed or how the results are
taxed in various jurisdictions and before non-cash amortization expense. EBITDA is defined as earnings
before interest, taxes, depreciation and amortization.
This press release contains forward-looking statements subject to various risk factors and uncertainties, which
may cause the actual results, performances or achievements of Eveready to be materially different from any
future results, performances or achievements expressed or implied by such forward-looking statements. Such
factors include, but are not limited to, fluctuations in the market for oil and gas and related products and
services, political and economic conditions, the demand for services provided by Eveready, industry
competition and Eveready’s ability to attract and retain both customers and key personnel.
For further information, please contact:
Rod Marlin – President & CEO
Telephone: (780) 451-6075
Fax: (780) 451-2142
John M. Stevens - CFO
Telephone: (780) 451-6075
Fax: (780) 451-2142