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TORONTO, March 10 /CNW/ - GT Canada Capital Corporation ("GT Canada"), a capital pool company listed on the TSX Venture Exchange ("TSXV"), is pleased to announce that it has received approval from the TSXV to close its previously announced acquisition of a medical office building in Hamilton, Ontario, which is to serve as GT Canada's qualifying transaction (the "Qualifying Transaction"). Since November 2009, the TSXV has been reviewing GT Canada's affairs and use of proceeds, as referenced in GT Canada's information circular (in respect of the Qualifying Transaction) dated November 12, 2009. TSXV approval of such matters was a condition for TSXV final acceptance of the Qualifying Transaction. The Qualifying Transaction is scheduled to close on March 12, 2010.
The TSXV's final acceptance follows a review conducted by its Compliance & Disclosure Department on GT Canada's affairs and use of proceeds as a 'capital pool company'.
GT Canada has acknowledged multiple instances of non-compliance in respect of TSXV Policy 2.4 (the "CPC Policy"), including:
- exceeding the maximum amount that a capital pool company can spend on
purposes other than evaluating assets or businesses for a proposed
qualifying transaction and failing to track and monitor its expenses
to ensure compliance with this requirement,
- making non-arm's length payments to its interim Chief Financial
Officer for consulting services without TSXV approval and in direct
contravention of the CPC Policy's prohibitions on such payments to
non-arm's length parties,
- failing to classify expenses (in respect of whether they are being
incurred solely for the purposes of evaluating assets or businesses
for a proposed qualifying transaction or otherwise) to ensure
compliance with the CPC Policy, and
- making payments (including reimbursing expenses incurred by its CEO
and CFO) for business purposes other than evaluating assets or
businesses for a proposed qualifying transaction.
As a result of the above, its directors and officers also failed to comply with undertakings which they each provided to TSXV and the Securities Commissions relating to restrictions on the use of proceeds and the expenditure of funds by a capital pool company.
Other than the CPC Policy, GT Canada has also acknowledged non-compliance with TSXV policies, including:
- non-compliance with the TSXV listing agreement by failing to have two
signatories signing all cheques,
- failing to properly review and document the approval of expense
accounts, including allowing the CEO to approve, on his own, the
incurring and reimbursement of his own reasonable business expenses,
- failing to implement adequate corporate governance for a CPC and
internal control procedures that were sufficiently focused on
ensuring compliance with TSXV policies.
It is GT Canada's position that all such deficiencies were inadvertent. After they were brought to the attention of GT Canada's board of directors, the company immediately adopted and implemented new procedures to strengthen its internal controls and ensure improved future compliance with TSXV rules, including:
- ceasing to make prohibited payments to its interim Chief Financial
- implementing a system to improve the timely classification of
expenses to ensure compliance with the CPC Policy,
- enhancing its procedures with respect to the review and approval of
all expenses (regardless of amount) before they are reimbursed,
- requiring the signature of two directors (or the Chief Executive
Officer and one director) on all cheques, negotiable instruments and
wire transfer authorizations (regardless of amount), and
- prohibiting any individual from signing a cheque or wire transfer
authorization made payable to the same individual.
In response to a requirement from the TSXV to add additional directors with prior TSXV experience as a result of concerns arising from TSXV's review of GT Canada's affairs and use of proceeds, GT Canada formed an ad hoc nominating committee of directors whose mandate was to enhance GT Canada's ability to fully comply with TSXV rules by identifying potential directors. GT Canada is delighted to announce that the following two candidates have agreed to join GT Canada's board of directors effective immediately, subject to the approval by TSXV.
- Victor Wells. Mr. Wells is a corporate director. Mr. Wells is also a
director of Student Transportation Inc, TriNorth Capital Inc.,
MagIndustries Corp., and Northstar Healthcare Inc., and is formerly a
Trustee of Canada Cartage Diversified Income Fund, where he chaired
its Audit Committee. From October 2007 until May 2009, Mr. Wells
served as Chief Financial Officer of Titanium Corporation, a Canadian
minerals company. From July 2001 until March 2006, Mr. Wells was Vice
President, Finance and Chief Financial Officer of Chemtrade Logistics
Income Fund. From 1998 to 2001, Mr. Wells was Vice President, Finance
and Chief Financial Officer of Tahera Diamond Corporation, a diamond
mining company listed on the TSX. Mr. Wells obtained his Chartered
Accountant designation with Ernst & Young LLP in Toronto, and was
elected a Fellow of the Institutes of Chartered Accountants of
British Columbia and Ontario. Mr. Wells obtained his Institute of
Corporate Directors designation in 2007.
- C. Bruce Burton. Mr. Burton is a corporate director. Mr. Burton is
also a director of BioteQ Environmental Technologies Inc., Titanium
Corporation and Continental Nickel Limited. He is a Chartered
Accountant with over 25 years experience as a senior financial
executive primarily in the natural resources sector. He was Vice
President, Finance of the Camflo Group of companies, which were
involved in gold and coal mining as well as the oil and gas and
geothermal businesses. Following a brief period with a private real
estate development company, Mr. Burton joined the Rayrock group as VP
Finance and Director. Rayrock Group was involved in gold, copper, and
fertilizer mining as well as oil and gas. Between 1999 and 2001 he
was President of BlackRock Ventures Inc., a heavy oil company which
he refinanced following the hiring of an experienced operating
management team. Between 2003 and 2007, Mr. Burton was VP and Chief
Financial Officer of Dundee Precious Metals Inc. He received an
honours degree in Business Administration from the University of
Western Ontario and a Master of Business Administration from York
On closing of the Qualifying Transaction, it is proposed that each new director will receive options to acquire 30,000 common shares of GT Canada at a price of $0.25 per common share.
Following completion of the Qualifying Transaction, GT Canada intends to identify and acquire medical office buildings in Canada.
The TSXV has in no way passed upon the merits of the proposed Qualifying Transaction and has neither approved nor disapproved the contents of this press release. The TSXV does not accept responsibility for the adequacy or accuracy of this press release.
SOURCE GT CANADA CAPITAL CORPORATION
For further information: For further information: Andrew Shapack, Chief Executive Officer, GT Canada Capital Corporation, (416) 572-2170