StorageVault Canada, Inc. announced today, further to its June 26th, 2017 news release, that it has entered into an asset purchase agreement executed on July 24, 2017 with Access Self Storage, Inc. (“Access”), Depotium Self Stockage Inc. and A-Z Storage Limited, subsidiaries of Access (collectively, the “Vendors”), to purchase for an aggregate purchase price of $34.2 million, subject to customary adjustments, all of the storage assets, property and business used in one Toronto area store, two stores in Quebec and three stores in Nova Scotia (the “Acquisition”). The Acquisition of the self storage stores in Toronto and Quebec continues StorageVault’s strategic expansion into the Ontario and Quebec markets. The assets located in Nova Scotia will provide StorageVault with a total of four stores in the Maritimes once other previously announced transactions are closed. The Acquisition is subject to the acceptance of the TSX Venture Exchange and, as Access is a non-arm’s length party to StorageVault, the Acquisition is considered to be a “related party transaction” as defined in Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101”) and TSX Venture Exchange (“TSXV”) Policy 5.9. Assuming all conditions in the purchase agreement are met or waived, it is anticipated that the closing of the Acquisition will occur on or before August 15, 2017.
Purchase Price and Payment
The purchase price for the Acquisition is $34.2 million, subject to adjustments, and is payable by the issuance of 714,286 ($2,000,000) common shares of StorageVault at a deemed price of $2.80 per common share, with the remainder of the purchase price being paid with funds on hand and first mortgage financing.
Material Conditions Precedent to the Acquisition
The independent Acquisition Committee of StorageVault approved the Acquisition, including the issuance of the common shares in relation to the Acquisition, on June 21, 2017. The obligations of StorageVault to complete the Acquisition are subject to initial conditions including, but not limited to: satisfactory due diligence; satisfactory Environmental Site Assessment Reports; satisfactory financing; and formal StorageVault board of director approval of the Acquisition. The initial conditions for the Acquisition must be satisfied one day before closing. The obligations of both StorageVault and the Vendors to complete the closing of the Acquisition are subject to the satisfaction of other customary closing conditions including, but not limited to, TSXV acceptance of the Acquisition.
Exemption from MI 61-101 and TSXV Policy 5.9
The Acquisition is considered a “related party transaction” under MI 61-101 and TSXV Policy 5.9. StorageVault is relying on exemptions from the formal valuation and minority approval requirements of MI 61-101 and TSXV Policy 5.9, in respect of the Acquisition, pursuant to Section 5.5(b) (Issuer Not Listed on Specified Markets) and Section 5.7(a) (Fair Market Value Not More Than 25% of Market Capitalization) of MI 61-101, respectively. No new insiders will be created, nor will any change of control occur, as a result of the Acquisition.
No finders fees are payable in relation to the Acquisition. Completion of the Acquisition is subject to a number of conditions as disclosed above and as set forth in the purchase agreement. There can be no assurance that the Acquisition will be completed as proposed or at all. The TSXV has in no way passed upon the merits of the Acquisition and has neither approved nor disapproved the contents of this news release.
About StorageVault Canada, Inc.
StorageVault owns and operates storage locations in the provinces of British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Quebec, and Nova Scotia.