Taggart Capital Corp.
TSX VENTURE : TAG.P

December 21, 2012 09:56 ET

Taggart Capital Corp. Announces Closing of Upsized Private Placements for Aggregate Gross Proceeds of $6.3 Million in Connection With Its Qualifying Transaction

TORONTO, ONTARIO--(Marketwire - Dec. 21, 2012) - Taggart Capital Corp. (the "Company") (TSX VENTURE:TAG.P) is pleased to announce that it has completed its previously announced private placements, raising gross proceeds of approximately $6.3 million. The aggregate size of the private placements was increased from the previously announced $5.25 million, and modified from the initially anticipated issuance of common shares of the Company to subscription receipts (each a "Subscription Receipt"), at a price of $0.30 per Subscription Receipt (the "Offering").

Canaccord Genuity Corp. ("Canaccord") acted as exclusive agent in connection with the Offering. The Company has agreed to pay to Canaccord a commission of up to 6% of the gross proceeds of the Offering.

The net proceeds of the Offering will be released from escrow concurrently with the closing of the Qualifying Transaction and the completion of certain release conditions set out under the terms of a subscription receipt agreement (the "Release Conditions"). Upon the completion of the Release Conditions, each Subscription Receipt will be automatically converted without further payment or action on the part of the holder thereof, into one common share of the Company (each a "Common Share"). If the Release Conditions are not completed by March 6, 2013, holders of the Subscription Receipts shall be refunded their proportionate share of the escrowed funds (and any interest accrued thereon) and the Subscription Receipts shall be cancelled. Each Subscription Receipt and Common Share issuable upon conversion thereof will be subject to a four-month hold period.

The net proceeds of the Offering, to be received upon completion of the Release Conditions, will be used to, among other things, satisfy the cash component of the purchase price payable by the Company in connection with the acquisition of a recently constructed 10,574 square-foot two-storey commercial retail property located at 135 Main Street in Moncton, New Brunswick (the "QT Property"), which is expected to close in early January 2013. Any excess proceeds from the Offering will be used (i) to pay any costs associated with the acquisition of the QT Property, (ii) to identify and pay deposits on future property acquisitions, and (iii) for general corporate and working capital purposes. The Offering has already been conditionally approved by the Exchange. As disclosed to in the November 22, 2012 press release of the Company, the acquisition of the QT Property, among other things, is intended to serve as the Company's proposed "Qualifying Transaction" as such term is defined under the TSX Venture Exchange's (the "Exchange") Policy 2.4 - Capital Pool Companies.

The QT Property was built in 2012 on approximately 82,000 square feet of land located on Main Street in Moncton in an expanding retail node. It is currently 100% leased on a long-term basis to a Canadian Schedule I Chartered Bank until April 2022, generates annual net operating income of approximately $360,000 and has a book value of $6.075 million, as reflected in the most recently prepared statements of the QT Property. The purchase price for the QT Property will be $5,975,000, subject to closing costs and customary adjustments, representing a going-in capitalization rate of 6.0%, including undeveloped land which may accommodate an additional retail development in the future. The QT Property is currently subject to a first mortgage in the principal amount of approximately $2,850,000 bearing interest at a rate of 4.13% per annum, with a term expiring in June 2022, which is intended to be assumed by the Company.

Forward-Looking Statements

This press release contains forward-looking statements. Often, but not always, forward-looking statements can be identified by the use of words such as "plans", "expects" or "does not expect", "is expected", "estimates", "intends", "anticipates" or "does not anticipate", or "believes", or variations of such words and phrases or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Examples of such statements include, among other things, the intention to complete the Qualifying Transaction and the Release Conditions. Accordingly, readers should not place undue reliance on forward looking statements,. The factors identified above are not intended to represent a complete list of the factors that could affect the Company.

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

Contact Information

  • Taggart Capital Corp.
    John FitzGerald
    President, Chief Executive Officer, Chief Financial Officer
    and Corporate Secretary
    (416) 207-3307