/THIS NEWS RELEASE IS INTENDED FOR DISTRIBUTION IN
CANADA ONLY AND IS NOT AUTHORIZED
FOR DISTRIBUTION TO UNITED STATES
NEWSWIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES./
CALGARY, Nov. 4, 2016 /CNW/ - Mosaic Capital Corporation
("Mosaic") (TSX-V Symbols: M and M.PR.A) is pleased to
announce that, in connection with the proposed public offering of
convertible unsecured senior subordinated debentures previously
announced on November 1, 2016, it has
entered into an agreement with a syndicate of underwriters (the
"Underwriters") led by Canaccord Genuity Corp., pursuant to
which the Underwriters will purchase $15
million aggregate principal amount of 7.0% convertible
unsecured senior subordinated debentures (the "Debentures")
of Mosaic due December 31, 2021 at a
price of $1,000 per Debenture. Mosaic
has granted the Underwriters an over-allotment option to purchase
up to $2.25 million additional
aggregate principal amount of Debentures, exercisable, in whole or
in part, at any time until 30 days following the closing of the
Offering. If the over-allotment option is exercised in full, the
gross proceeds of the Offering will be $17.25 million.
Mosaic will use the net proceeds of the Offering for general
corporate purposes including future acquisitions, paying down
existing credit facilities and working capital.
The Offering is expected to close on or about November 10, 2016 and is subject to certain
conditions including, but not limited to, the receipt of all
necessary approvals, including the approval of the TSX Venture
Exchange (the "TSX Venture").
The Debentures will mature on December
31, 2021 (the "Maturity Date") and will accrue
interest at the rate of 7.0% per annum payable semi-annually in
arrears on June 30 and December 31 in each year, commencing June 30, 2017. The June
30, 2017 interest payment will represent accrued interest
for the period from the closing date to June
30, 2017. At the holder's option, the Debentures may be
converted into common shares of Mosaic ("Common Shares") at
any time prior to the close of business on the earlier of the
business day immediately preceding (i) the Maturity Date, (ii) the
date fixed for redemption of the Debentures or (iii) if called for
repurchase in the event of a change of control where the
consideration consists of 10% or more in (a) cash, (b) equity
securities that are not traded or intended to be traded immediately
following such transaction on a stock exchange, or (c) other
property that is not traded or intended to be traded immediately
following such transaction on a stock exchange, the payment date
for such repurchase. The conversion price (the "Conversion
Price") will be $9.00, subject to adjustment in certain
circumstances.
The Debentures will be direct, unsecured obligations of Mosaic
subordinate to all liabilities, except liabilities which by their
terms rank in right of payment equally with or subordinate to the
Debentures.
The Debentures will not be redeemable at the option of Mosaic on
or before December 31, 2019 (the
"First Call Date"). After the First Call Date and
prior to December 31, 2020 (the
"Second Call Date"), the Debentures may be redeemed in whole
or in part from time to time at the option of Mosaic on not more
than 60 days and not less than 30 days prior notice, at a price
equal to their principal amount plus accrued and unpaid interest,
provided the volume weighted average trading price of the Common
Shares on TSXV for the 20 consecutive trading days ending on the
fifth trading day preceding the date on which notice of redemption
is provided is at least 125% of the Conversion Price. On or after
the Second Call Date, the Debentures may be redeemed in whole or in
part from time to time at the option of Mosaic, at a price equal to
their principal amount plus accrued and unpaid interest. Mosaic
shall provide not more than 60 nor less than 30 days' prior notice
of redemption of the Debentures.
Subject to specified conditions, Mosaic will have the right to
repay the outstanding principal amount of the Debentures, on
maturity or redemption, through the issuance of Common Shares.
Mosaic will also have the option to satisfy its obligation to pay
interest through the issuance and sale of Common Shares.
A preliminary prospectus supplement for the Offering was
previously filed with the securities regulatory authorities in all
provinces of Canada, except Québec
on November 1, 2016. A final shelf
prospectus supplement is expected to be filed with the securities
regulatory authorities in all provinces of Canada, except Québec, as soon as
possible.
The securities being offered have not been, nor will they be,
registered under the United States Securities Act of 1933, as
amended, and may not be offered or sold within the United States or to, or for the account or
benefit of, U.S. persons absent U.S. registration or an applicable
exemption from the U.S. registration requirements. This news
release does not constitute an offer for sale or the solicitation
of an offer to buy Securities in the
United States or in any jurisdiction in which such offer,
solicitation or sale would be unlawful.
ABOUT MOSAIC CAPITAL CORPORATION
Mosaic is a Canadian investment company that owns a portfolio of
established businesses which span a diverse range of industries and
geographies. Mosaic's strategy is to create long-term value for its
shareholders through accretive acquisitions, long-term portfolio
ownership, sustained cash flows and organic portfolio growth.
Mosaic achieves its objectives by maintaining financial discipline,
acquiring businesses at attractive valuations, performing extensive
acquisition due diligence, utilizing optimal transaction
structuring and working closely with subsidiary businesses after
acquisition.
Neither the TSX Venture Exchange nor its Regulation
Services Provider (as that term is defined in policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
FORWARD LOOKING INFORMATION
This news release contains forward-looking information and
statements within the meaning of applicable Canadian securities
laws (herein referred to as "forward-looking statements") that
involve known and unknown risks, uncertainties and other factors
that may cause actual results, performance or achievements to be
materially different from any future results, performance or
achievements expressed or implied by such forward-looking
statements. All information and statements in this news release
which are not statements of historical fact may be forward-looking
statements. The words "believe", "expect", "intend", "estimate",
"anticipate", "project", "scheduled", and similar expressions, as
well as future or conditional verbs such as "will", "should",
"would", and "could" often identify forward-looking statements. In
particular, forward-looking statements in this news release
include, but are not limited to, statements regarding expectations
and assumptions respecting timing and the expected closing of the
Offering. Such statements or information are only predictions and
reflect the current beliefs of management with respect to future
events and are based on information currently available to
management. Actual results and events may differ materially from
those contemplated by these forward-looking statements due to these
statements being subject to a number of risks and
uncertainties.
Undue reliance should not be placed on these forward-looking
statements as there can be no assurance that the plans, intentions
or expectations upon which they are based will occur. By their
nature forward-looking statements involve assumptions and known and
unknown risks and uncertainties, both general and specific, that
contribute to the possibility that the predictions and other
forward-looking statements will not occur. Some of the assumptions
made by Mosaic, upon which such forward-looking statements are
based include, but are not limited to: future market conditions
will not be materially different than anticipated by Mosaic; there
will be no material changes to government and environmental
regulations affecting Mosaic or its operations; and the business
operations of the operating businesses of Mosaic will continue on a
basis consistent with prior years.
A number of factors could cause actual results to differ
materially from those expressed or implied by the forward-looking
statements, including, but not limited to: the possible failure to
obtain necessary regulatory approvals or to satisfy conditions
necessary to complete the Offering; prevailing economic conditions;
unexpected changes in the financial markets (including in the
trading price of the securities of Mosaic); and changes in the
general economic and business conditions of one or more of Mosaic
and its subsidiaries. Should any of the risks or uncertainties
facing Mosaic and its subsidiaries materialize, or should
assumptions underlying the forward-looking statements prove
incorrect, actual results, performance, activities or achievements
could vary materially from those expressed or implied by any
forward-looking statements contained in this news release. Readers
are cautioned that the foregoing list of risks is not exhaustive.
Additional information on these and other factors that could affect
the operations or financial results of Mosaic and its subsidiaries
are included in the Prospectus Supplement, the Base Shelf
Prospectus and Mosaic's annual information form for the year ended
December 31, 2015, a copy of each of
which is available under Mosaic's profile on SEDAR
(www.sedar.com).
Although Mosaic believes that the expectations represented by
any forward-looking-statements contained herein are reasonable
based on the information available to it on the date of this news
release, management cannot assure investors that actual results,
performance or achievements will be consistent with these
forward-looking statements. Any forward-looking statements herein
contained are made as of the date of this news release and Mosaic
does not assume any obligation to update or revise them to reflect
new information, events or circumstances, except as required by
law.
SOURCE MOSAIC CAPITAL CORPORATION