TORONTO, Dec. 7, 2022
/CNW/ - Standard Mercantile Acquisition Corp. (TSX: SMA) (the
"Company") today announces that the Company has negotiated a
favorable renewal of a mortgage (the "Alberta
Mortgage") with a principal amount of approximately
$16.9 million (of which the Company's
portion is approximately $8.4
million), which is approximately 77.5% of the Company's
mortgage portfolio consisting of two remaining mortgages in its
portfolio and the renewal relates to a residential property located
in the Province of Alberta, for a
period of one year expiring on December 1,
2023. (the "Mortgage Renewal"). The Mortgage Renewal
was negotiated by the Company in collaboration with the mortgage
administrator responsible for the administration of the Alberta
Mortgage, Trez Capital Limited Partnership.
Under the terms of the Mortgage Renewal, the borrower agreed to
pay the Company approximately $2.8
million on December 1, 2022,
which payment has been received by the Company as of the date of
this press release, with two additional $2.8
million payments payable to the Company on or before
June 1, 2023 and on or before
December 1, 2023. The Company is also
entitled to a 1% extension fee on its portion of the outstanding
principal amount of the Alberta Mortgage. Interest will is now
to be paid monthly on the Company's portion of the Alberta Mortgage
until it is fully paid. The Alberta Mortgage was previously renewed
in November 2020.
Special Distribution
The Company also announces that its board of directors has
declared a special distribution of $0.45 per Class A share of the Company (the
"Special Distribution"). The Special Distribution, which
constitutes a return of capital pursuant to the winding-up of the
Company's business as approved by shareholders of the Company on
June 16, 2016, as amended on
May 6, 2021 (the "Orderly
Wind-Up"), will be paid on December 29,
2022 to holders of Class A shares of record at the close of
business on December 16, 2022. As of
December 7, 2022, there were
7,318,067 Class A shares outstanding.
The Special Distribution payment is not subject to any
condition, will be made in cash and will be subject to the "Due
Bill" trading requirements mandated by the Toronto Stock Exchange
(the "TSX"). Because the amount of the Special Distribution
represents a distribution of greater than 25% of the market value
of the Class A shares on the declaration date, the TSX has required
that the Class A shares trade on a "Due Bill" basis during the
period (the "Due Bill Period") from and including
December 15, 2022 until the close of
trading on December 29, 2022 (the
"Payment Date"). This means that buyers of Class A shares
through the facility of the TSX during the Due Bill Period will
receive the Special Distribution payment, provided they continue to
be holders of the applicable Class A shares on the Payment
Date.
The Class A shares will commence trading on an ex-distribution
basis (i.e., without an attached "Due Bill" entitlement to the
Special Distribution) commencing the opening of trading on
December 30, 2022 (i.e., the next
trading day after the Payment Date). The Due Bill redemption date
will be January 3, 2023. As a result
of the Class A shares trading on a Due Bill basis during the Due
Bill Period, those entitled to be paid the Special Distribution
owing on the Due Bills should expect to receive that payment by the
Due Bill redemption date of January 3,
2023.
About the Company
The Company holds a portfolio of mortgages in Canada. At the Company's 2021 annual and
special meeting of shareholders, the Company sought and received
shareholder approval to change its name to "Standard Mercantile
Acquisition Corp." and broaden the parameters of the Orderly
Wind-Up. The Company remains focused on monetizing its remaining
mortgage assets pursuant to the Orderly Wind-Up through potential
future distributions of cash as and when available, and as
determined to be in the best interests of the Company and
shareholders, or otherwise and is considering options to enable its
shareholders to participate in the potential future value of the
Company through transactions that could capitalize on the Company's
public listing. The Board has experience in sourcing, evaluating
and executing transactions of this nature. There can be no
assurances as to the timing or quantum of any future cash
distributions or other monetization transactions.
Forward Looking Statements
Statements in this press release contain forward-looking
information. Such forward-looking information may be identified by
words such as "anticipates", "plans", "proposes", "estimates",
"intends", "expects", "believes", "may" and "will". The
forward-looking statements are founded on the basis of expectations
and assumptions made by the Company. Details of the risk factors
relating to the Company and its business are discussed under the
heading "Business Risks and Uncertainties" in the Company's annual
Management's Discussion & Analysis for the year ended
December 31, 2021 and under the
heading "Risk Factors" in the Company's Annual Information Form
dated March 30, 2022, copies of which
are available on the Company's SEDAR profile at www.sedar.com. Most
of these factors are outside the control of the Company. Investors
are cautioned not to put undue reliance on forward-looking
information. These statements speak only as of the date of this
press release. Except as otherwise required by applicable
securities statutes or regulation, the Company expressly disclaims
any intent or obligation to update publicly forward-looking
information, whether as a result of new information, future events
or otherwise.
SOURCE Standard Mercantile Acquisition Corp.