MONT Montfort Capital Corp

~Langhaus Financial increases bank loan capacity with its largest lending partner and Montfort Series 1 Class C Preferred Shares created to convert $12.5 million of Langhaus Class A Preferred Shares~

TORONTO, July 4, 2023 /CNW/ - Montfort Capital Corporation ("Montfort" or the "Company") (TSXV: MONT) (OTCQB: MONTF), a leading alternative lender utilizing focused strategies, experienced management teams and advanced technology, is pleased to announce that its insurance lending subsidiary, Langhaus Financial Partners Inc. ("Langhaus"), has increased its bank funding capacity by $65 million. Additionally, Montfort has launched its Series 1, Class C Preferred Shares for the conversion of $12.5 million of Langhaus Class A Preferred Shares. Langhaus is the leading non-bank provider of life insurance backed lending solutions to high-net-worth individuals and entrepreneurs in Canada. This expansion is a strategic move to support the rapid growth of Langhaus' insurance lending business.

"The additional capacity comes at a highly opportune time for our insurance lending business," said Cory Bast, COO of Langhaus Financial. "We continue to see growth in demand for our insurance policy-backed lending solutions and this increase in funding will enable us to expand our business and support Canadian advisors and their clients. The share conversion is also an endorsement of the Montfort business model leveraging its expertise in private credit across many verticals including technology, small and medium sized businesses, real estate and our insurance lending solutions."

On July 1, 2023, the board of directors of the Company resolved to create the Series 1, Class C Preferred Shares (the "Series 1 Shares") to facilitate the share exchange with the preferred shareholders of Langhaus Financial Corporation. Under the terms of the Series 1 Shares, holders of the Series 1 Shares are entitled to a non-cumulative annual dividend rate equal to the yield on the Canadian dollar denominated non-callable Government of Canada bond with a two-year maturity ("Canadian 2YR Yield") plus 5.0% (the "Dividend Rate"), payable quarterly if and when such dividend is declared by the Company. Under the terms of the Series 1 Shares, if the actual Canadian 2YR Yield is less than 1.00%, the Canadian 2YR Yield will be deemed to be 1.00% for the purposes of the Dividend Rate and if the actual Canadian 2YR Yield is greater than 7.00%, the Canadian 2YR Yield will be deemed to be 7.00% for the purposes of calculating the Dividend Rate. The Dividend Rate will be calculated on the last day of the previous quarter in which a dividend is payable. The Company expects the first dividend on the Series 1 Shares to be payable on October 1, 2023.

The Series 1 Shares are also redeemable by the Company at $25.00 per Series 1 Share and rank subordinate to the Class A and Class B Preferred Shares upon liquidation, dissolution or winding-up of the Company or other distributions of assets among shareholders for the purposes of winding-up affairs.

Please refer to the full terms and conditions of the Series 1 Shares included in the Articles of Company and posted to the Company's SEDAR profile at www.sedar.com.

The Company is pleased to announce closing of share exchange agreements (the "Share Exchanges") with all holders (the "LFC Shareholders") of each series of the Class A Preferred Shares in Langhaus Financial Corporation (the "LFC Shares"). Under the terms of the Share Exchanges, the LFC Shareholders collectively agreed to exchange all 1,247,000 issued and outstanding LFC Shares for 498,800 Series 1 Shares. The LFC Shares were acquired by the Company at $10.00 per LFC Share.

In connection with the Share Exchange, the Company has also entered into arrangements with certain holders of Series 1 Shares regarding the future potential redemption of their Series 1 Shares.

As a leading non-bank provider of insurance policy-backed lending solutions, Langhaus collaborates closely with major insurance companies and top advisers in Canada. The expertise of the Langhaus team lies in designing flexible lending programs tailored to borrowers' specific requirements. Their proficiency extends to structured finance transactions and complex borrower structures, which often fall beyond the scope of traditional Canadian banks.

The significant increase in lending capacity reinforces Langhaus' position as the leader in the insurance policy-backed lending market, delivering exceptional financial solutions to its valued clientele across Canada.

Montfort manages a diversified group of specialized private credit brands that utilize focused strategies and experienced management teams combined with advanced technology to improve fee-related performance. Montfort facilitates transparency for all of its investors through public company reporting. For further information, please visit www.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.

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.

SOURCE Montfort Capital Corp.