Fronsac Capital Inc.
TSX VENTURE : GAZ

Fronsac Capital Inc.

June 30, 2011 16:21 ET

Fronsac Capital Purchases a Property in Riviere-du-Loup, Quebec

SAINT-JEAN-BAPTISTE, QUEBEC--(Marketwire - June 30, 2011) - Fronsac Capital inc. ("Fronsac") (TSX VENTURE:GAZ) announces the conclusion of an agreement for the acquisition of a property located in Rivière-du-Loup, Québec for a total consideration of $1,000,000.

"We are pleased to add this property to our portfolio. Combining a convenience store and a gas station, the property meets the profitability standards set forth by the management", declared Mr. Michel Lassonde, President and CEO of Fronsac. "Fronsac's announced conversion into a REIT was a favourable factor to the transaction".

The property is located on Hôtel-de-Ville Boulevard, which connects it directly to Highway 20, the main thoroughfare between Quebec City and Rivière-du-Loup. The property combines a convenience store operated by Couche-Tard as well as a Petro-Canada gas station.

The purchase price of $1,000,000 shall be paid as follows upon closing:

  1. $334,000 payable cash out of Fronsac's cash reserves;
  1. Balance of sale of $333,000 bearing interest at an annual rate of 4.5% payable at the term of a three year period from closing;
  1. $333,000 through the issuance of preferred shares of the limited partnership through which Fronsac is purchasing the property. These preferred shares shall be convertible, subject to certain conditions, into a total of 1,332,000 units of Fronsac Real Estate Investment Trust, following the conversion of Fronsac into a REIT, representing a price of $0.25 per unit.

The closing of this transaction is set to occur on or around August 15, 2011 and remains subject to usual commercial terms and conditions as well as the approval of competent authorities.

About Fronsac

Fronsac is a Canadian corporation listed on the TSX Venture Exchange engaged in the commercial real estate business. Fronsac is always on the lookout for real estate properties which, ideally, offer a combination of gas station, convenience store and fast food services.

Fronsac Real Estate Investment Trust is an open-ended trust which will, upon closing of the above-mentioned conversion set to occur on or around July 1st, 2011, hold Fronsac Capital Inc.'s real estate portfolio and continue its growth strategy.

Forward-Looking Statements

This press release contains forward-looking statements and information within the meaning of applicable securities legislation, including statements about Fronsac and expectations relating to the proposed transaction and benefits that are expected to be realized as a result of the transaction. There can be no assurances that the proposed transaction will be consummated or that the anticipated benefits will be realized. The proposed transaction is subject to various approvals and consents and there can be no assurances that any such approvals or consents will be obtained. Fronsac cautions the reader that actual results may differ materially from those in the forward-looking statements, considering such known and unknown risks, uncertainties and other factors, which may cause actual results to differ materially from anticipated future results. Factors that could cause actual results to differ materially from those set forth in the forward-looking statements and information include but are not limited to, general economic conditions; local real estate conditions; dependence on tenants' financial condition; the uncertainties of real estate activities; interest rates; availability of equity and debt financing; the impact of newly-adopted accounting principles on accounting policies as well as other risks and factors described from time to time in the documents filed by Fronsac with the securities regulators, including management's discussion and analysis. Fronsac disclaims any intention or undertaking to update or revise any forward-looking statements even as a result of future events or otherwise, except as required by applicable law.

Neither TSX Venture Exchange nor its Regulatory Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Contact Information

  • Mr. Michel Lassonde
    President and CEO
    Fronsac Capital Inc.
    (450) 536-5328