VANCOUVER, BC – March 7, 2024 – Montfort Capital Corp. (“Montfort” or the “Company”) (TSX-V:MONT/OTCQB:MONTF), a trusted provider of focused private credit strategies for institutional investors, family offices, and wealth managers, today announced that the Company’s board of directors has declared a quarterly cash dividend (the “Class A Quarterly Dividend”) of $0.02 per Series A Class A Preferred Shares (each, a “Class A Preferred Share”), payable on March 28, 2024, to holders of Class A Preferred Shares of record as at March 19, 2024. The Class A Quarterly Dividend qualifies as an ‘eligible dividend’ for Canadian income tax purposes.
Holders of the Class A Preferred Shares are entitled to receive fixed non-cumulative preferential cash dividends, if, as and when declared by the board of directors of the Company (the “Board”). Under the Company’s dividend policy, the annual dividend rate for the Class A Preferred Shares is targeted to be $0.08 per Class A Preferred Share and dividends, if declared, will be payable on the last day of December, March, June and September in each year, or if such day is not a business day, on the next business day, at a quarterly rate of $0.02 per Class A Preferred Share. The amount and distribution dates of future dividends remain at the discretion of the Company’s board of directors.
The Company’s board of directors has also declared a quarterly cash dividend (the “Class C Quarterly Dividend”) of $0.5520 per Series 1 Class C Preferred Shares (each, a “Class C Preferred Share”), payable on March 28, 2024, to holders of Class C Preferred Shares of record as at March 19, 2024. The Class C Quarterly Dividend qualifies as an ‘eligible dividend’ for Canadian income tax purposes.
Holders of the Class C Preferred Shares are entitled to receive fixed non-cumulative preferential cash dividends, if, as and when declared by the board of directors of the Company. Under the terms of the Class C Preferred Shares, holders of the Class C Preferred Shares shall be entitled to receive, if declared, an amount determined by multiplying the Floating Quarterly Dividend Rate as calculated on the applicable Floating Rate Calculation Date by $25.00 and multiplying that product by a fraction, the numerator of which is the actual number of days in the Quarterly Floating Rate Period and the denominator of which is 365 or 366, depending on the actual number of days in the applicable year, payable on the day subsequent to applicable for the Quarterly Floating Rate Period. The amount and distribution dates of future dividends remain at the discretion of the Company’s board of directors.
“Floating Quarterly Dividend Rate” means, the annual rate of interest (expressed as a percentage rounded to the nearest one hundred-thousandth of one percent (with 0.00005% being rounded up)) equal to the sum of the Government of Canada Yield on the applicable Floating Rate Calculation Date and 5.00%; provided that, if: (i) the Government of Canada Yield on the Floating Rate Calculation Date is less than 1.00%, the Company will deem the Government of Canada Yield to be 1.00% for the purposes of calculating the Floating Quarterly Dividend Rate on each Floating Rate Calculation Date; and (ii) the Government of Canada Yield on the Floating Rate Calculation Date exceeds 7.00%, the Company will deem the Government of Canada Yield to be 7.00% for the purposes of calculating the Floating Quarterly Dividend Rate on each Floating Rate Calculation Date.
“Floating Rate Calculation Date” means, for any Quarterly Floating Rate Period, the last day of the prior fiscal quarter to the Quarterly Floating Rate Period. “Quarterly Floating Rate Period” means the period from and including the beginning of a fiscal quarter and ending on the last day of such fiscal quarter, with the fiscal quarters of Montfort commencing on January 1, April 1, July 1 and October 1. The description of the terms of the Class A Preferred Shares and the Class C Preferred Shares disclosed in this press release are qualified in their entirety by the articles of Montfort posted to its SEDAR+ profile, which can be accessed at www.sedarplus.ca.
In support of Montfort’s growth, certain officers and directors of the Company have subscribed for unsecured demand promissory notes issued by Montfort (the “Promissory Notes”) in the amount of $1.5 million for purposes of funding portfolio investments. The Promissory Notes carry an annual interest rate of 12% interest. The issuance of the Promissory Notes by Montfort is considered a “related party transaction” within the meaning of TSX Venture Policy 5.9 and Multilateral Instrument 61-101 – Protection of Minority Security Holders in Special Transactions (“MI 61-101”). The Company has relied on exemptions from the formal valuation and minority shareholder approval requirements of MI 61-101 contained in sections 5.5(a) and 5.7(1)(a) of MI 61-101 as the principal amount of each Promissory Note issued to insiders does not exceed 25% of the Company’s market capitalization (as determined in accordance with MI 61-101).
About Montfort Capital Corp.
Montfort is a trusted provider of focused private credit strategies for institutional investors, family offices, and wealth managers. We employ focused strategies, experienced management teams and advanced technology to drive superior risk-adjusted investment returns. For further information, please visit www.montfortcapital.com
For more information, please contact:
Tim McNulty / Darren Seed
Incite Capital Markets
Ken Thomson, CEO
Montfort Capital Corporation
(604) 398-8839
IR@MONTFORTCAPITAL.COM
Neither the TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this news release.
Forward-Looking Information
Certain information and statements in this news release contain and constitute forward-looking information or forward-looking statements as defined under applicable securities laws (collectively, “forward-looking statements”). Forward-looking statements normally contain words like ‘believe’, ‘expect’, ‘anticipate’, ‘plan’, ‘intend’, ‘continue’, ‘estimate’, ‘may’, ‘will’, ‘should’, ‘ongoing’ and similar expressions, and within this news release include any statements (express or implied) respecting the future growth of the Company and the Company’s future financial performance.
Forward-looking statements are not guarantees of future performance, actions, or developments and are based on expectations, assumptions and other factors that management currently believes are relevant, reasonable and appropriate in the circumstances, including, without limitation, the assumption that the Company and its investee companies are able to meet their respective future objectives and priorities and assumptions concerning general economic growth and the absence of unforeseen changes in the legislative and regulatory framework for the Company.
Although management believes that the forward-looking statements are reasonable, actual results could be substantially different due to the risks and uncertainties associated with and inherent to Montfort’s business. Material risks and uncertainties applicable to the forward-looking statements set out herein include but are not limited to: intense competition in all aspects of business; reliance on limited management resources; general economic risks; new laws and regulations and risk of litigation. Although Montfort has attempted to identify factors that may cause actual actions, events or results to differ materially from those disclosed in the forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, predicted, estimated or intended. Also, many of the factors are beyond the control of Montfort. Accordingly, readers should not place undue reliance on forward-looking statements. Montfort undertakes no obligation to reissue or update any forward-looking statements as a result of new information or events after the date hereof except as may be required by law. All forward-looking statements contained in this news release are qualified by this cautionary statement.