XS Cargo Income Fund
TSX VENTURE : XSC.UN

XS Cargo Income Fund

May 26, 2011 13:10 ET

XS Cargo Income Fund Receives Unitholder and Court Approvals for Previously Announced Plan of Arrangement

EDMONTON, ALBERTA--(Marketwire - May 26, 2011) - XS Cargo Income Fund (TSX VENTURE:XSC.UN) (the "Fund" or "XS Cargo") is pleased to announce that it has received unitholder and court approval for its previously announced plan of arrangement (the "Arrangement"), pursuant to which, among other things, XSC Canada Holdings Inc. ("Holdings"), a wholly-owned indirect subsidiary of KarpReilly LLC, will acquire the Fund's 51% interest in each of XS Cargo Limited Partnership (the "LP") and XS Cargo GP Inc. (the "GP"), for gross cash consideration of $5,332,019 (the "Purchase Price"). Pursuant to the Arrangement, Holdings will also acquire the remaining 49% interest in the LP and the GP held by Famous Brands (Edmonton) Inc., a company controlled by Mr. Michael McKenna, a director and the President and Chief Executive Officer of the GP, which is the administrator of the Fund and the general partner of the LP.

In excess of 99.9% of the units and special voting units cast at the unitholder meeting held to consider the Arrangement were voted in favour of the Arrangement. The Arrangement is currently scheduled to close on May 31, 2011. Pursuant to the Arrangement, the Fund will be wound-up and the Purchase Price will be distributed to unitholders of the Fund on a pro rata basis after the payment of all transaction and wind-up costs and expenses. The wind-up of the Fund and the redemption of the Fund's units is expected to occur on or about June 15, 2011. The Fund will then submit notice to the TSX Venture Exchange (the "Exchange") to have the Fund's units de-listed from the Exchange. Further information with respect to the amount to be distributed to unitholders on the redemption of the units, and the timing of wind-up and redemption will be provided in due course.

Business of the Fund

The Fund is an unincorporated open-ended trust created to invest in the broadline closeout retail business through an indirect controlling interest of the LP which through its general partner, the GP, operates 42 closeout retail stores in Alberta, British Columbia, Manitoba, Saskatchewan, Ontario, Newfoundland, Nova Scotia and New Brunswick.

About KarpReilly, LLC

KarpReilly, LLC is a private investment firm, whose primary mission is to partner with premier small to mid-size growth companies and help them achieve their long-term vision. KarpReilly currently manages funds and affiliates with initial capital commitments totaling $310 million. Over the past 15 years, the principals of KarpReilly have invested in, sat on the boards of and nurtured over 25 consumer growth companies. Among the notable discount and closeout retail companies that the principals of KarpReilly have invested in are Dollar Tree Stores, Ollie's Bargain Outlet, and Bob's Discount Furniture among others. For more information, please visit www.karpreilly.com.

Forward-Looking Statements

Certain statements contained in this document constitute forward-looking statements or information (collectively "forward-looking statements") within the meaning of the "safe harbour" provisions of applicable securities legislation. Forward-looking statements are typically identified by words such as "will" and "expect" and similar words suggesting future events or future performance. In particular, this document contains forward-looking statements pertaining to, without limitation, the proposed timing for closing the Arrangement, the anticipated timing for the wind-up of the Fund and the distribution of the Purchase Price to unitholders of the Fund and the anticipated delisting of the Fund's units on the Exchange. With respect to forward-looking statements contained in this document, the Fund has made assumptions regarding, among other things, the ability to satisfy all conditions precedent to closing the Arrangement and the ability to satisfy the payment of all transaction and wind-up costs and expenses by June 15, 2011. Although the Fund believes that the expectations reflected in the forward-looking statements contained in this document, and the assumptions on which such forward-looking statements are made, are reasonable, there can be no assurance that such expectations will prove to be correct. Readers are cautioned not to place undue reliance on forward-looking statements included in this document, as there can be no assurance that the plans, intentions or expectations upon which the forward-looking statements are based will occur. By their nature, forward-looking statements involve numerous assumptions, known and unknown risks and uncertainties that contribute to the possibility that the predictions, forecasts, projections and other forward-looking statements will not occur, which may cause the Fund's actual performance and financial results in future periods to differ materially from any estimates or projections of future performance or results expressed or implied by such forward-looking statements. These risks and uncertainties include, among other things, that the closing conditions for the Arrangement may not be satisfied and that closing of the Arrangement may be delayed or may not occur at all. Readers are cautioned that this list of risk factors should not be construed as exhaustive. The forward-looking statements contained in this document speak only as of the date of this document. Except as expressly required by applicable securities laws, the Fund does not undertake any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. The forward-looking statements contained in this document are expressly qualified by this cautionary statement.

NEITHER THE TSX VENTURE EXCHANGE NOR ITS REGULATION 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

  • XS Cargo Income Fund
    Michael McKenna
    President and Chief Executive Officer
    (780) 413-4296