/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,
Jan. 30, 2017 /CNW/ -
Mosaic Capital Corporation ("Mosaic") (TSX-V Symbols: M,
M.PR.A, M.PR.B, M.DB and M.DB.A) is pleased to announce
that following the close of trading on January 27, 2017, it filed, and received receipt
for, a preliminary short form prospectus (the "Preliminary
Prospectus") with securities regulatory authorities in all
provinces of Canada, except
Québec, in connection with the offering of 2,551,020 subscription
privileges (the "Subscription Privileges"), which entitle
the holder thereof to subscribe for an aggregate of 2,551,020
common shares of Mosaic at a price of $9.80 per share (the "Subscription Price")
for aggregate gross proceeds of up to $25
million (the "Offering"). The Offering is being made
to: (i) holders of Mosaic's 10% unsecured subordinated perpetual
preferred securities (the "10% Preferred Securities") of
record as of the close of business (Calgary time) on February 9, 2017 (the "Record Date"); and
(ii) holders of Mosaic's series 1 private yield securities (the
"Private Yield Securities") of record as of the close of
business (Calgary time) on the
Record Date.
As a result of the previously announced redemption and
retraction of the 10% Preferred Securities and Private Yield
Securities to occur on February 10,
2017, Mosaic has received a significant amount of interest
from many long term holders of the 10% Preferred Securities and
Private Yield Securities to remain as securityholders of Mosaic.
The Offering provides an efficient means by which such persons can
re-invest in Mosaic following the redemption and retraction of the
10% Preferred Securities and Private Yield Securities,
respectively.
Under the Offering, Mosaic will issue: (i) 0.1943 Subscription
Privileges for each 10% Preferred Security outstanding; and (ii)
19.43 Subscription Privileges for each Private Yield Security
outstanding. Each whole Subscription Privilege will entitle the
holder thereof to acquire one common share of Mosaic at the
Subscription Price. The Subscription Privileges under the Offering
will be eligible for exercise from February
10, 2017 until 5:00 p.m.
(Calgary time) on March 2, 2017 (the "Expiry Date"). A
holder of Subscription Privileges who exercises all such
Subscription Privileges by subscribing for the maximum number of
common shares of Mosaic to which such holder is entitled to
subscribe, may subscribe at the Subscription Price pro rata
for additional whole common shares of Mosaic, if any, not otherwise
purchased by other holders of Subscription Privileges. No
fractional common shares will be issued. Where the exercise of the
Subscription Privileges would otherwise entitle a holder to receive
a fractional common share of Mosaic, the holder's entitlement will
be reduced to the next lowest whole number of common shares.
As soon as practicable following the Expiry Date, Mosaic will
pay a fee of $0.25 per Subscription
Privilege exercised to the securities broker or dealer, bank or
trust company or other CDS participant whose client exercised the
Subscription Privilege. No managing or soliciting dealer has been
engaged in connection with the Offering.
John Mackay, Executive Chairman
of Mosaic said "We appreciate the long term support and interest of
our 10% Preferred Security holders and Private Yield Security
holders in continuing to be a part of Mosaic and to finance some of
the future growth of Mosaic. This offering allows those
securityholders the opportunity to re-invest part of the proceeds
of the redemption into common shares in a meaningful way".
Since August 2016, Mosaic has
announced:
- The acquisition of an 80% interest in Mackow Industries in
Winnipeg Manitoba. Mackow is a
manufacturer of precision fabricated metal components. Mackow's
primary market is North American manufacturers of transit buses and
highway motor coaches.
- Closing of a public offering of $15,626,000 aggregate principal amount of 7%
convertible unsecured senior subordinated debentures.
- The acquisition of a 70% interest in Bassi Construction and
Bascon Group. Bassi is a 50-year-old multidiscipline commercial and
industrial renovation/tenant refit and construction company with
over 120 employees, headquartered in Ottawa, Ontario.
- Closing of the tuck-in acquisitions of Tundra Mechanical and
Millwrighting Ltd. and Associated Asbestos Abatement Ltd. by two of
Mosaic's subsidiaries.
- Investment by Fairfax Financial Holdings Limited, through
certain of its subsidiaries, of $150
million.
- The execution of a new credit agreement with ATB Corporate
Financial Services, which provides for a $35
million credit facility to Mosaic.
The net proceeds of the Offering will be used for future
acquisitions that fit Mosaic's acquisition criteria and for general
corporate purposes, which may include paying down existing credit
facilities and payment of expenses in connection with Mosaic's
day-to-day operations. Unallocated funds will be added to working
capital.
Mosaic has not received any standby commitments in respect of
the Offering. Pursuant to applicable regulatory requirements,
completion of the Offering is not subject to raising a minimum
amount of proceeds.
Mosaic has not applied to list or quote the Subscription
Privileges, and does not intend to apply to list or quote the
Subscription Privileges on the TSX Venture Exchange (the
"Exchange"), a U.S. marketplace, or a marketplace outside
Canada and the United States. Mosaic has applied to list
the common shares issuable upon exercise of the Subscription
Privileges on the Exchange. Listing of such common shares of Mosaic
will be subject to Mosaic fulfilling all of the requirements of the
Exchange.
The Offering is subject to certain conditions including, but not
limited to, the receipt of all necessary regulatory approvals,
including the acceptance of the Exchange.
The Subscription Privileges and the common shares of Mosaic
issuable pursuant to the exercise of the Subscription Privileges
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 creative 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 with respect to the anticipated use of net proceeds of
the Offering; the pricing, size and timing of completion of the
Offering; and the receipt of regulatory approvals in connection
with 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: the ability of Mosaic to
obtain all required regulatory approvals in connection with the
Offering; 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: unexpected changes in
the financial markets (including in the trading price of the
securities of Mosaic) prior to filing the final short form
prospectus or closing of the Offering; unexpected regulatory
issues; prevailing economic conditions; 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 Mosaic's preliminary short form prospectus dated
January 27, 2017 and 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