Firm Capital Mortgage Investment Corporation Announces $40 Million Bought Deal Financing

/NOT FOR DISTRIBUTION TO UNITED STATES NEWS SERVICES OR BROADCASTING IN THE UNITED STATES/

TORONTO, Jan. 18, 2022 (GLOBE NEWSWIRE) — Firm Capital Mortgage Investment Corporation (the “Company”) (TSX: FC) is pleased to announce that it has entered into an agreement to sell, on a take underwriter, to a syndicate of underwriters maintained by TD Securities Inc., National Bank Financial Inc. and CIBC Capital Markets, an aggregate principal amount of $40,000,000 of 5.00% convertible unsecured subordinated debentures due March 31 2029 (the “Debentures”) at a price of $1,000 per Debenture. The Company has granted the underwriters an over-allotment option to purchase up to $6,000,000 of additional aggregate principal amount of Debentures at the same price, exercisable, in whole or in part, at any time up to 30 days after the closing of the placement. If the Over-Allotment Option is exercised in full, the gross proceeds of the Offering will total $46,000,000.

The net proceeds of the offering will be used for debt repayment and general corporate purposes.

The debenture offering is expected to close on or about January 27, 2022 and is subject to certain conditions, including, but not limited to, obtaining all necessary regulatory approvals.

The Debentures will bear interest at the rate of 5.00% per annum, payable semi-annually in arrears on the last day of March and September of each year, commencing on September 30, 2022, and will mature on March 31, 2029 (the “Date Maturity”). The Debentures will be convertible at the option of the holder into common shares of the Corporation (the “Shares”) at any time prior to the close of business on the earliest Maturity Date and on the business day immediately preceding the date set for redemption at a conversion price of $17.00 per share (the “Conversion Price”), subject to adjustment in certain circumstances.

The Debentures will not be redeemable prior to March 31, 2025. On or after March 31, 2025 and prior to March 31, 2027, the Debentures will be redeemable in whole or in part from time to time at the Company’s option at par plus accrued charges and unpaid interest, provided that the weighted average trading price of the shares on the Toronto Stock Exchange during the 20 consecutive trading days ending on the fifth trading day preceding the date on which the redemption notice is given is not less than 125 % of conversion price . On or after March 31, 2027, the Debentures will be redeemable, in whole or in part, from time to time, at the Corporation’s option, at any time, at par plus accrued and unpaid interest.

The Debentures will be direct unsecured obligations of the Company, subordinated to senior indebtedness of the Company, ranking pari-passu the Corporation’s existing unsecured subordinated convertible debentures.

Subject to specific conditions, the Company will have the right to repay the unpaid principal amount of the Debentures, on maturity or redemption, by the issuance of shares. The Company will also have the option of satisfying its obligation to pay interest by issuing and selling shares.

The Debentures will be issued pursuant to a prospectus supplement which will be filed on or before January 20, 2022 with the securities authorities of all provinces of Canada pursuant to the Company’s short form base shelf prospectus dated December 30, 2020. .

No securities regulatory authority has approved or disapproved of the contents of this press release. The securities offered have not been and will not be registered under the United States Securities Act of 1933, as amended, or any state securities law, and may not be offered, sold or delivered, directly or indirectly , in the USA. , its possessions and other areas subject to its jurisdiction or to, or on behalf of or for the benefit of a US Person, unless an exemption from registration is available. This press release is for informational purposes only and does not constitute an offer to sell or a solicitation of an offer to buy securities of the Company in any jurisdiction.

About the company

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The Company, through its mortgage banker, Firm Capital Corporation, is a non-bank lender that offers short-term residential and commercial financing and conventional real estate financing, including construction, mezzanine and equity investments. The Company’s investment objective is the preservation of equity, while providing shareholders with a stable stream of monthly dividends from investments. The Company achieves its investment objectives by investing in selected niche markets that are underserved by large lending institutions. To date, the lending business continues to build a diversified mortgage portfolio, producing a stable return for shareholders. The Company is a mortgage investment company (SIM) within the meaning of the income tax law (Canada). Accordingly, the Company is not taxed on income provided that its taxable income is paid out to its shareholders in the form of dividends within 90 days of December 31 of each year. These dividends are generally treated by shareholders as interest income, so that each shareholder is in the same position as if the mortgage investments made by the Company had been made directly by the shareholder. Complete reports of the Company’s financial results for the year are contained in the Company’s audited financial statements and related MD&A, available on the SEDAR website at www.sedar.com. Additionally, additional information is available on the Company’s website at www.firmcapital.com.

Forward-looking statements

This press release contains forward-looking statements within the meaning of applicable securities laws, including, among other things, statements relating to the ability to satisfy the regulatory, stock exchange and commercial closing conditions of the offering, the use expected proceeds from the offering, as of the closing date of the offering, the uncertainty associated with access to capital markets and statements regarding the business of the Company, including those contained in the Company’s annual information form for the financial year ended December 31, 2020, as well as statements regarding management’s beliefs, estimates, intentions and similar statements regarding anticipated future events, results, circumstances, performance or expectations that are not historical facts. Forward-looking statements can generally be identified by the use of forward-looking terminology such as “outlook”, “goal”, “may”, “should”, “expect”, “intend”, “estimate”, ” anticipates”, “believes”, “should”, “plans” or “continues” or similar expressions suggesting future results or events. These forward-looking statements reflect management’s current beliefs and are based on information currently available to management.

These statements are not guarantees and are based on our estimates and assumptions which are subject to risks and uncertainties, including those described in the Company’s Annual Information Form for the year ended December 31, 2020 under the heading ” Risk” (a copy of which may be obtained at www.sedar.com). These risks and uncertainties include, among others, risks associated with public health crises (including COVID-19), mortgages, dependence on the Company’s manager and mortgage banker, competition for mortgages, real estate values, interest rate fluctuations, environmental issues, civil liability and the introduction of new tax rules. Important factors or assumptions that have been applied in drawing a conclusion or making an estimate set out in the forward-looking information include, among others, that the Company is able to invest in mortgages at rates consistent with historically achieved rates. , adequate mortgage investment opportunities are presented to the Company, adequate bank debt and bank loans are available to the Company, and an insignificant impact resulting from the COVID-19 pandemic. Although the forward-looking information contained in this new press release is based on what management considers to be reasonable assumptions, there can be no assurance that actual results and performance will be consistent with these forward-looking statements.

All forward-looking statements contained in this press release are qualified by these cautionary statements. Except as required by applicable law, the Company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

For more information, please contact:
Firm Capital Mortgage Investment Corporation
Eli Dadouch
President and CEO
(416) 635-0221

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