VANCOUVER,
Sept. 17, 2013 /CNW/ - Further to its
press release dated February 1, 2013,
TG Residential Value Property Ltd. (TSXV: TG.P) (the
"Company" or "TG"), a Vancouver-based Capital Pool Company listed on
the TSX Venture Exchange (the "Exchange"), has appointed MGI
Securities Inc. ("MGI") as its exclusive agent for a
brokered private placement of units consisting of convertible
debentures and warrants (the "Debenture Units") using the
"Accredited Investor" exemption (the "Debenture
Financing").
The terms of the Debenture Financing are as
follows:
Issue: 3,400 Debenture Units, each
Debenture Unit consisting of a $1,000
principal amount convertible debenture (each a "Convertible
Debenture") plus 4,000 common share purchase warrants (each a
"Warrant").
Price: $900
per Debenture Unit.
Convertible Debentures:
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Term: Three years (the "Term"), commencing on the
issuance of the Convertible Debentures and ending on the date that
is 3 years after the date of such issuance. |
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Coupon: 10 % per annum payable quarterly, commencing September
30, 2014. |
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Yield to maturity: 11.11% |
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Conversion: Each Convertible Debenture will be convertible into
4,000 common shares of the Company during the Term, unless the
Company completes a new issue of common shares at a price that is
less than $0.20 per common share (adjusted for any consolidation or
roll-back) during the Term, in which case the conversion price will
be adjusted down pro-rata to maintain a 25% conversion premium,
subject to a minimum Conversion Price of $0.105. |
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Example: TG completes a new issue at $0.16, conversion price
is adjusted to $0.16 x 125% = $0.20 and the conversion for each
Convertible Debenture is adjusted to 5,000 common shares. |
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Security: The Convertible Debentures will be secured by a
subordinated charge in the form of a General Security Agreement
("GSA") on the assets of TG, including the shares of any TG
subsidiaries. The GSA will be subordinate to any mortgages on
real estate assets and any bank operating line of credit on all
other assets. The Company will also allow the Convertible Debenture
holders to place a caveat on the Company's Penthouse Building in
Winnipeg, Manitoba. |
Warrants: Each Warrant will be
exercisable to purchase one common share of the Company at a price
of $0.30 per share for a period of
three years from the date of issuance. The Warrants will be
subject to an accelerated expiry date if the Company's common
shares trade at $0.40 or above for a
period of 20 consecutive trading days after the date that is 12
months after the issuance of the Warrants.
Agent's Commission: The Company will pay
MGI up to an 8% cash commission and issue to MGI up to 8% in
options (the "Agent's Compensation Options") calculated on the
aggregate amount of the proceeds raised pursuant to the Debenture
Financing, which aggregate proceeds are to be calculated on the
purchase price of the Debenture Units, not the par value.
Each Agent's Compensation Option entitles the
Agent to purchase one unit of the Company (an "Agent's
Unit") at $0.225 per Agent's Unit
at any time prior to the date that is 36 months from the date of
issuance of the Agent's Compensation Options.
Each Agent's Unit shall be comprised of one
common share of the Company (an "Agent's Unit Share") and
one common share purchase warrant of the Company (an "Agent's
Warrant"). Each Agent's Warrant shall entitle the holder
thereof to purchase one additional common share of the Company (an
"Agent's Warrant Share") at an exercise price of
$0.30 per Agent's Warrant Share for a
period of 36 months from the date of issuance of the Agent's
Compensation Options.
General
The Debenture Financing is in addition to the
previously announced subscription receipt financing (the
"Subscription Receipt Financing") which the Company
anticipates will be adjusted to between $1,000,000 and $1,500,000 in gross proceeds.
The Subscription Receipt Financing and the
Debenture Financing shall close concurrently on September 27, 2013, or such other date as the
Company and MGI shall agree.
Completion of the Debenture Financing is subject
to a number of conditions, including but not limited to, Exchange
acceptance. There can be no assurance that the Debenture
Financing will be completed as proposed or at all.
The Exchange has in no way passed upon the
merits of the proposed transaction and has neither approved nor
disapproved the contents of this press release.
Trading in the Company's common shares on the
Exchange will remain halted pending completion of its previously
announced Qualifying Transaction.
ON BEHALF OF TG RESIDENTIAL VALUE
PROPERTIES INC.
"Douglas Thiessen"
Douglas
Thiessen
President, Chief Executive Officer and Director
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.
This press release includes "forward-looking
information" within the meaning of applicable Canadian securities
laws, including information regarding the Debenture Financing and
the Subscription Receipt Financing. Users of forward-looking
information are cautioned that actual results may vary from the
forward-looking information disclosed in this press release. The
material risk factors that could cause actual results to differ
materially from the forward-looking information contained in this
press release include, risks related to Exchange approval of the
Debenture Financing and the risk that there are not sufficient
subscriptions for the Debenture Financing and/or the Subscription
Receipt Financing. The forward-looking information contained
in this press release represents management's best judgment of
future events based on information currently available. The
material assumptions used to develop the forward-looking
information include that Exchange approval of the Debenture
Financing will be obtained and that there are sufficient
subscriptions for the Debenture Financing and the Subscription
Receipt Financing. The Company does not assume the obligation
to update any forward-looking information, except as required by
applicable law.
SOURCE TG Residential Value Properties Ltd.