Montfort Capital Announces Sale of TIMIA Group to Round13 Capital for total value of $6.5 million

(All figures in Canadian dollars)

TORONTO, Oct. 17, 2024 /CNW/ - Montfort Capital Corp. ("Montfort" or the "Company") (TSXV: MONT), a trusted provider of focused private credit strategies for institutional investors, family wealth offices, and wealth managers, is pleased to announce it has entered into a securities purchase agreement (the "Agreement") with an affiliate of Round13 Capital (the "Buyer"), an arm's length third party to the Company, pursuant to which Montfort agrees to sell (the "Transaction") all of its right, title and interest to the entities comprising the TIMIA Capital business unit, which together provide a technology-based lending platform that provides debt capital to B2B recurring revenue technology businesses in North America (the "TIMIA Group"), and Montfort's equity interests in the TIMIA Group investment funds.

The total value of the Transaction includes an all-cash purchase price of $4.5 million, subject to certain purchase price adjustments, plus the prepayment of $2 million in principal indebtedness to Pivot Financial I Limited Partnership ("Pivot"), an affiliate of Montfort, as creditor to TIMIA Capital Holdings Limited Partnership, an entity under the TIMIA Group.

Ken Thomson, CEO of Montfort Capital, said: "We are very pleased to announce this transaction, which represents an evolution of our strategy. After successfully growing the business to its present size, TIMIA will now benefit from becoming part of Round13's portfolio which focuses on technology investments within North America.  Montfort remains focused on its other lending units that provide scalable and focused private credit opportunities."

Brahm Klar, Managing Partner of Round13, said: "As a leading venture debt platform supporting a long-underserved segment of the Canadian private credit market, TIMIA is an exceptional complement to our core equity funds. This deal will enable Round13 to offer Canadian entrepreneurs a full suite of expanded financing options to grow their businesses and is aligned with our vision of building enduring, long-term partnerships with our investors and portfolio companies."

The Transaction remains subject to certain customary closing conditions. The Transaction is not conditional on financing. The Transaction is expected to close by the end of the month.

About Montfort Capital Corp.

Montfort is a trusted provider of focused private credit strategies for institutional investors, family offices, and wealth managers.  Our experienced management teams employ focused strategies to drive superior risk-adjusted investment returns. Montfort's business lines include:

• Brightpath Capital, one of Canada's leading providers of alternative residential mortgages.
• Langhaus Financial, provides insurance policy-backed lending solutions to high-net-worth individuals and entrepreneurs in Canada.
• Nuvo Financial, is focused on providing net asset value (NAV) loans to small and mid-sized investment funds in Canada.
• Pivot Financial which specializes in asset-backed private credit targeting mid-market borrowers in Canada.

For further information, please visit www.montfortcapital.com.

About Round13 Capital

Founded in 2013, Round13 Capital is a leading venture and growth equity investment platform based in Toronto, Canada. The firm invests in high-potential companies across a range of sectors, with a focus on supporting their growth and development over the long term. Round13's team of experienced investors and operators bring a wealth of expertise and insight to every investment, helping portfolio companies to realize their full potential. Round13 is dedicated to creating long-term value for its investors and the companies it supports. For further information, please visit www.round13.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 Statements 

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) related to the closing of the Transaction and the timing thereof, the satisfaction of all conditions precedent to the closing of the Transaction and any benefit that may be derived by the Company from the Transaction, including, without limitation, any material benefit to the working capital or financial position of the Company as a result of the Transaction.

There is no guarantee the Transaction will be completed as contemplated or at all, and the forward-looking statements contained herein are based on expectations, assumptions and other factors that management currently believes are relevant as of the date hereof, reasonable and appropriate in the circumstances, including, without limitation, assumptions with respect to the financial position and working capital of the Company and TIMIA Capital, the ability of the Company to satisfy the conditions precedent under the Agreement, and the conditions of the financial markets and the private lending markets generally, among others.

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: risks related to the disposition of an operating business by the Company, risks that the benefits derived from the Transaction may not be as expected or that the Company may not see any benefit from the Transaction, risks that each party to the Agreement may not satisfy its obligations or covenants, risks that the Company may be subject to litigation as a result of the Transaction including allegations of misrepresentation or breach of conditions or covenants, as well as the risk factors discussed in the Company's MD&A, and other public disclosure filings which are available through SEDAR+ at www.sedarplus.ca. 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.

ON BEHALF OF THE BOARD
Ken Thomson
Director and CEO

SOURCE Montfort Capital Corp.

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