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HOME :: RESEARCH :: DEBT :: NEWS:: JUN 2007

BlackWatch Energy Services Trust (TSX:BWT.UN) ("BlackWatch" or the "Trust") Provides an Information


BlackWatch (TSX:BWT.UN) wishes to provide an update on its financial condition, and various strategic and financing initiatives. In BlackWatch's financial and operations update for the first quarter, we disclosed that the Trust was continuing to feel the impact of a broad market weakness, compounded by reduced demand for services in some of its specific markets. In addition, as a result of weak financial results in the fourth quarter of 2006 and the first quarter of 2007, BlackWatch is in breach of several of the financial covenants contained within its senior credit facility agreement. Pursuant to the terms of the credit facility agreement, such a breach provides the senior lenders the right to take certain actions including termination of the credit facility and steps to recover the amount owed. As noted below, management has had constructive discussions with its lenders regarding a re-capitalization which we believe will allow BlackWatch to continue to carry out its business plan.

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