XS Cargo Income Fund
TSX : XSC.UN

XS Cargo Income Fund

May 17, 2005 14:51 ET

XS Cargo Income Fund Completes $61 Million IPO

NOT FOR DISTRIBUTION TO U.S. NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE
UNITED STATES

EDMONTON, ALBERTA--(CCNMatthews - May 17, 2005) - XS Cargo Income Fund (the
"Fund") is pleased to announce the successful completion of its initial public
offering. The Fund issued 6,106,000 trust units at $10.00 per unit for gross
proceeds of $61,060,000. At closing, the Fund acquired a 51% limited partnership
interest in XS Cargo Limited Partnership ("XS Cargo LP") and XS Cargo LP used
the funds from the offering and borrowings under its credit facility to acquire
the broadline closeout retail business carried on by Famous Brands (Edmonton)
Inc. ("FBEI"). The remaining 49% interest in XS Cargo LP is held by FBEI, which
is controlled by founder, Michael McKenna, who continues as President and Chief
Executive Officer of XS Cargo GP Inc., the general partner of XS Cargo LP. XS
Cargo LP is now one of the largest broadline closeout retailers in Canada. It
owns and operates 21 stores in the provinces of Alberta, British Columbia,
Saskatchewan, Manitoba and Ontario, with an additional 3 stores to be opened by
the end of June 2005.

The Fund intends to make monthly distributions of its distributable cash,
estimated at $1.125 per trust unit annually. The first distribution to
unitholders is expected to be made on July 15, 2005, for the period from May 17
to June 30, 2005, and is estimated to be $0.1387 per unit. Subsequent regular
distributions in the amount of $0.09375 per trust unit are expected to be made
in each month thereafter on the 15th day of the month to unitholders of record
on the last business day of the preceding month, commencing on or about August
15, 2005. The Fund's trust units are listed on the Toronto Stock Exchange under
the symbol "XSC.UN". Additional information about the Fund and this transaction
is available at www.sedar.com.

The underwriting syndicate for the offering was led by CIBC World Markets Inc.
and included RBC Capital Markets, National Bank Financial Inc., Canaccord
Capital Corporation and Sprott Securities Inc.

The securities offered have not been, and will not be, registered under the
United States Securities Act of 1933, as amended, and may not be offered or sold
in the United States absent registration or any applicable exemption from the
registration requirement of such Act. This press release shall not constitute an
offer to sell or the solicitation of an offer to buy, nor shall there be any
sale of these securities in any jurisdiction in which such offer, solicitation
or sale would be unlawful.

Contact Information

  • XS Cargo Income Fund
    Michael McKenna
    President and Chief Executive Officer
    (780) 413-4296
    or
    XS Cargo Income Fund
    Jeff Rootman
    Vice-President, Finance and Chief Financial Officer
    (780) 413-4296
    Website: www.xscargo.com