Jaguar calls for payment of $1,010 per $1,000 principal amount of debentures
as required under the Canadian Royalties Indenture

    
    DEBENTURE HOLDERS TAKING A 20% HAIRCUT TO FINANCE AN EXCESSIVE PAYMENT
    OF $0.80 PER SHARE TO SHAREHOLDERS INCLUDING THE CANADIAN ROYALTIES CEO
    WHO OWNS ABOUT 4.9 MILLION SHARES
    

TORONTO , Oct. 21 /CNW/ - Jaguar Financial Corporation (TSX: JFC) ("Jaguar" or the "Company"), announced today on behalf of certain holders which include Jaguar of 7% convertible debentures due March 31, 2015 (the "Debentures") issued by Canadian Royalties Inc. ("Canadian Royalties" or "CZZ"), its opposition to the offer (the "Jien Offer") made by Jien Canada Mining Ltd. (and certain other companies) (collectively "Jien"), as revised on October 16, 2009 , to acquire all of the common shares of Canadian Royalties for $0.80 per share and all of the Debentures for $800 per $1,000 of principal amount of Debenture (the "Jien Offer").

Jaguar believes, as a fundamental principle, that creditors should receive full recovery of their entire principal amount, plus the premium of 1% as required under the Indenture between CZZ and the Indenture Trustee as a result of the proposed change in control, prior to any payment being made to common shareholders in the Jien Offer. Jaguar considers it oppressive that Jien has not respected the basic priority of creditors over common shareholders of CZZ in the Jien Offer.

CZZ was not able to raise sufficient capital to put the Nunavik nickel project into production and accordingly the project has been placed on care and maintenance. CZZ is estimated to have about $20 million in cash resources which would cover interest payments on the Debentures and operating expenses for approximately a one year period. In the absence of a significant capital injection, Jaguar believes Canadian Royalties would likely become insolvent at the end of this one year period.

If CZZ were to obtain creditor protection under the Companies Creditors Arrangement Act, the shareholders would receive nothing and Jaguar believes the holders of Debentures would receive 100 cents on the dollar for their Debentures from the proceeds of the sale of the Nunavik project. If the Nunavik sale proceeds exceed the total amount owing under the Debentures, the recovery by the shareholders would not be expected to be anywhere close to $81.6 million or $0.80 per share, and any recovery to the shareholders, as limited as it would be, would clearly be after full recovery by holders of the Debentures.

Vic Alboini, Chairman and Chief Executive Officer of Jaguar stated: "We do not believe that holders of Debentures should be treated prejudicially under the Jien Offer compared to how holders of Debentures would be treated under a potential bankruptcy proceeding. It is incredible that the Debenture holders are not being paid 101 cents on the dollar as required under the Indenture when the Canadian Royalties CEO is driven to haircut the Debentures in order to finance his excessive payment for his approximately 4.9 million shares."

Jaguar is also concerned that BMO Capital Markets which acted as co-lead underwriter in the $137.5 million financing 18 months ago is giving a fairness opinion to CZZ that effectively says it is fair to haircut the Debentures in order to finance an inappropriate payment to the shareholders of Canadian Royalties. "We believe that BMO Capital Markets has a conflict of interest between the Debenture holders and the shareholders which can only be resolved by the Debenture holders receiving 101 cents on the dollar, not $0.80 on the dollar", stated Mr. Alboini . "The BMO fairness opinion says the Jien Offer is fair to the CZZ shareholders but does not say, as it should, that the Jien Offer is unfair to the Debenture holders" he added.

Accordingly, Jaguar is considering various alternatives in order to block the Jien Offer, which may include, without limitation, Jaguar making an alternative superior offer to acquire approximately 34% principal amount of the Debentures including the Debentures already owned by Jaguar and certain other holders. If such an offer were made by Jaguar for the Debentures, Jaguar would not make an offer to acquire the shares of Canadian Royalties. Jaguar is also considering the commencement of an oppression action under applicable corporate legislation against the directors and officers of CZZ for their failure to pay the Debenture holders their payment of 101 cents on the dollar as required under the Indenture.

About Jaguar Financial Corporation

Jaguar is a Canadian merchant bank that invests in undervalued small capitalization companies in a variety of industry sectors.

The Toronto Stock Exchange does not accept responsibility for the adequacy or accuracy of this news release. This news release may contain certain forward looking statements which involve known and unknown risks, delays, and uncertainties not under Jaguar's control which may cause actual results, performances or achievements of Jaguar to be materially different from those implied by such forward looking statements.

For further information: on this press release, please contact: Vic Alboini, Chairman & Chief Executive Officer, [phone]; or Kyler Wells, General Counsel & Corporate Secretary, [phone]