Groupe Bikini Village inc.
TSX : GBV

Groupe Bikini Village inc.

March 03, 2014 16:28 ET

Groupe Bikini Village inc. Completes $500,000 Private Placement of Unsecured Demand Notes With Certain Shareholders

SAINTE-JULIE, QUEBEC--(Marketwired - March 3, 2014) - Groupe Bikini Village inc. (TSX:GBV) ("Groupe Bikini Village" or the "Corporation") today announced the successful completion, on March 1, 2014, of a private placement (the "Private Placement") of unsecured demand notes for an aggregate principal amount of $500,000 (the "Notes"). Certain shareholders of the Corporation subscribed to the Notes for the purposes of providing short-term financing, which, among other things, will allow the Corporation to continue to invest in its store renovation program.

The Notes will mature at the latest on May 29, 2014 (the "Maturity"). They will bear interest at an annual rate of 6%, which is payable, along with any outstanding principal, at Maturity. The Notes are convertible into common shares of the Corporation ("Common Shares") by its holders if the Corporation defaults on repayment of the Notes. In such circumstances, the Notes will be convertible into Common Shares at a price equal to the volume weighted average price of the five preceding trading days, which may be a more advantageous price than the current market price. The conversion of the Notes is subject to the approval by the Toronto Stock Exchange. In all cases, the Corporation has the option to prepay the Notes, in whole or in part, before Maturity.

Takota Premium Value Partnership LP ("Takota") (which currently has ownership or control of 329,687 Common Shares, representing 17.24% of all outstanding Common Shares), Elmag Investments Inc. ("Elmag") (which currently has ownership or control of 380,000 Common Shares, representing 19.87% of all outstanding Common Shares), 3459381 Canada Inc. ("3459381") (which currently has ownership or control of 150,000 Common Shares, representing 7.84% of all outstanding Common Shares) and Gestion Camille Roberge Inc. ("Gestion") (which currently has ownership or control of 4,181 Common Shares, representing 0.22% of all outstanding Common Shares) (collectively, the "Note Holders") subscribed to the Notes in amounts of $200,000, $200,000, $50,000 and $50,000 respectively. It is not currently possible to determine the number of Common Shares in which the Notes could be converted given the approval required by the Toronto Stock Exchange and future market price fluctuations.

Mr. Scott Leckie, chairman of the board of directors of the Corporation (the "Board"), is a principal at Takota. Mr. Franco Cristiano, a director of the Corporation, controls 3459381. Camille Drouin Roberge controls Gestion and is the spouse of Paul Delage Roberge, a director of the Corporation. Messrs. Leckie, Cristiano and Delage Roberge disclosed their interest in this Private Placement to the Board and abstained from any further discussions on the matter. Mr. Joe Marsilii, an independent director, lead the negotiations on the terms and conditions of the Private Placement on behalf of the Corporation. The Private Placement was unanimously approved by the Board. The Corporation did not file a material change report less than 21 days before the closing of the Private Placement given its purpose.

The Private Placement constitutes a "related party transaction" as defined under Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions ("MI 61-101"). However, it is exempt from the valuation and minority shareholder approval requirements of MI 61-101 as neither the fair market value of the Private Placement nor the consideration paid by the Note Holders exceeds 25% of the Corporation's market capitalization.

A copy of the Note Holders' reports under National Instrument 62-103 - The Early Warning System and Related Take-Over Bid and Insider Reporting Issues will be available on SEDAR at www.sedar.com or by contacting Ms. Chantal Létourneau, Interim President and Chief Executive Officer at 450 449-1310.

The Note Holders have purchased the Notes solely for investment purposes and the Private Placement is exempt from prospectus requirements in respect of Takota and Elmag under section 2.10 of NI 45-106 and in respect of 3459381 and Gestion under section 2.5(1)(h) of NI 45-106.

Groupe Bikini Village inc.'s shareholder reports and other information of interest to investors, are available on SEDAR at www.sedar.com, and on the Corporation's website at www.bikinivillage.com.

The issuance of this news release is not an admission that an entity named in this news release owns or controls any described securities or is a joint actor with another named entity.

"Group Bikini Village would like to take this opportunity to thank our shareholders for their continued support of the Corporation," said Chantal Letourneau, Interim President and Chief Executive Officer.

Groupe Bikini Village

Groupe Bikini Village inc., serving Canadians for more than a quarter-century, is a leader in the retail sale of beachwear products, with a network of boutiques across Eastern Canada. In its bright and inviting stores with comfortable change rooms and knowledgeable staff, Groupe Bikini Village helps its customers choose from among Canada's widest selection of swimsuits, beach and cruise wear and accessories, in the most popular brands the industry has to offer and in styles to suit every figure. Headquartered in Sainte-Julie, Quebec, Groupe Bikini Village operates 53 stores and employs approximately 425 people; its securities trade on the Toronto Stock Exchange under the stock symbol GBV. For more information about Groupe Bikini Village, please visit our website at www.bikinivillage.com.

Forward-looking statements

This news release contains certain forward-looking statements concerning Groupe Bikini Village inc.'s future operations, economic performance, financial conditions and financing plans. These statements are based on certain assumptions and analyses made by management in light of their experience and their perception of historical trends, current conditions and expected future developments, as well as other factors they believe are appropriate under the circumstances. However, whether actual results and developments will conform to management's expectations and predictions is subject to a number of risks, uncertainties and assumptions. Consequently, all of the forward-looking statements made in this news release are qualified by these cautionary statements, and there can be no assurance that the results or developments anticipated by management will be realized or, even if substantially realized, that they will have the expected consequences or effects on the Corporation. Management undertakes no obligation and does not intend to update or revise any forward-looking statements, whether as a result of new information, future events, or otherwise, except as may be required under applicable law.

The addresses of certain Note Holders are the following: (i) Canaccord Genuity Corp. In trust for Takota Premium Value Partnership LP, 161 Bay Street, Suite 2800 Toronto, Ontario M5J 2S1; (ii) Investissements Elmag Inc., 3678 de la Montagne, Montreal, Quebec H3G 2A8; and (iii) 3459381 Canada Inc., 1825 Laird Blvd., Montreal, Quebec H3P 2V2.

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