Final Report Released by Chartered Business Valuator Appointed by Aragorn Holdings Limited and WTF Holdings Inc. regarding Sa...

BRAMPTON, ON, Feb. 1, 2016 /CNW/ - Aragorn Holdings Limited ("Aragorn") and WTF Holdings Inc. ("WTF"), each having an address at 294 Walker Drive, Unit 2, Brampton, Ontario, announce that the chartered business valuator (the "Valuator") that they appointed for the purpose of determining the fair market value of the shares in Franchise Bancorp Inc. ("FBI") owned by Aragorn has released its final report.  The Valuator's final report of January 14, 2016 sets out a fair market value mid point of $2.04 per common share and $6.13 per Class A preference share and Class B preference share. 

As previously disclosed, in September 2009, WTF and Aragorn entered into a put agreement (the "Put Agreement") under which Aragorn could require WTF to purchase the shares then owned by Aragorn based on the fair market value at the time the Put Agreement was exercised.  Aragorn exercised its put right on September 8, 2014. 

As part of the sale of the shares under the Put Agreement, as amended by agreement dated February 1, 2016, the parties have agreed that Aragorn will be selling 2,594,523 common shares, 65,461.5 Class A preference shares and 201,500.5 Class B preference shares in the capital of FBI to WTF; and Edward Loyst, the owner of Aragorn and CEO of FBI, will be selling 89,737 common shares.  The aforementioned preference shares will be converted into common shares prior to closing on the basis of three common shares for one preference share. 

The purchase price would be $7,409,698, consisting of $7,109,698 to be paid on closing plus the $300,000 down payment already paid by WTF.  This represents approximately $2.13 per common share, $6.39 per Class A preference share and $6.39 per Class B preference share.

The shares to be sold by Aragorn represent 33.99% of the outstanding common shares, 50% of the outstanding Class A preference shares and 31.67% of the outstanding Class B preference shares.  The shares to be sold by Edward Loyst represent 1.18% of the outstanding common shares. 

Dino Fragaglia (the Vice President of Global Pet Food Stores Inc., a subsidiary of FBI), Paul Thomson (the President of FBI) and James Walker (the President, Global Pet Food Stores Inc., a subsidiary of FBI), directly or indirectly, own WTF.  WTF currently holds 2,161,275 (28.32%) common shares, 65,461.5 (50%) Class A preference shares and 201,500.5 (31.67%) Class B preference shares.  

Following the conversion of the preference shares held by Aragorn and completion of the sale by Aragorn and Edward Loyst, WTF will hold 5,646,421 (66.95%) common shares, 65,461.5 (100%) Class A preference shares and 201,500.5 (46.34%) Class B preference shares.  If WTF were to convert its preference shares following the sale by Aragorn and Edward Loyst, the security holdings of WTF would consist of 6,447,307 common shares (being 64.90% of the common shares on a fully diluted basis and 69.82% on a partially diluted basis).

Aragorn and WTF anticipate that the completion of the sale transaction will occur on February 16, 2016.  Another press release will follow upon completion of the transaction.

WTF intends to make a bid for the remainder of the FBI shares at no less than $2.04 per common share upon completion of its acquisition of the aforementioned shares; and if the price at which WTF acquires such aforementioned shares is more than 115% of the market price of the FBI shares, securities laws will require that WTF make a bid for the remainder of the FBI shares at no less than such purchase price.

NEITHER 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.

SOURCE Franchise Bancorp Inc.

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