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Existing Shareholder Consortium Offers Tuckamore Capital Management Superior Non-Dilutive Financing terms than the Placement Agreement the Company Announced with Orange Capital
-Consortium offer has NO back end fees payable vs. over $5 million to Orange Capital on t...
About this update from Flint Corp
[{"type":"text","content":"\n\n-Consortium offer has NO back end fees payable vs. over $5 million to Orange Capital on the $12.5 million placement -Offers placement at a premium to Orange Capital, reducing dilution-Allows all existing shareholders the opportunity to participate in the placement\n\n\n\nTORONTO, July 28, 2014 /CNW/ - Tuckamore Capital Management Inc. (the \"Company\" or \"Tuckamore\") (TSX: TX) shareholders Access Holdings Management Company (\"Access Holdings\") and First Series of Halcyon Trading Fund LLC (collectively the \"Consortium\") announce an offer to participate in a transaction with Tuckamore, with terms superior to those agreed to by the Company as part of a placement agreement it announced on Friday, July 25, 2014.\n\nOn Friday afternoon, Tuckamore announced that it had entered into a subscription agreement with Orange Capital Master I, Ltd. (\"Orange\"), to sell $12.5 million common shares of the Company to Orange at a price per share which will not be less than $0.75, resulting in the issuance of no more than 16,666,667 shares (or approximately 17% of the shares of Tuckamore following completion of the transaction) (the \"Orange Private Placement\"). At the same time, Tuckamore announced that Orange stands to receive material future fees of up to $5.3 million for assisting the Company with its capital structure and financing efforts. Upon payment of these fees to Orange, the effective price of the Private Placement would be as low as $0.43 per share, far lower than the nominal $.75 price or Tuckamore's closing share price on Friday, July 25, 2014. \n\nTuckamore announced this agreement at the same time it withdrew a failed management buy-out and ahead of a contested vote. The Company did not seek superior alternatives from its existing shareholders or allow third parties to come forward by announcing that the restrictions imposed on the Board and Tuckamore by the Tuckamore management controlled buyout vehicle had been waived to allow management to negotiate an alternative deal with Orange.\n\nSuperior Financing Available to the Company and Shareholders\n\nThe Consortium has sent a letter to Tuckamore detailing that it is prepared to offer non-dilutive equity financing to Tuckamore on similar terms as it extended to Orange, with some important modifications to key terms for the benefit of all shareholders, making the Consorti...