Mosaic Capital Corporation Closes $15 Million Convertible Debenture Financing

/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, Nov. 10, 2016 /CNW/ - Mosaic Capital Corporation ("Mosaic") (TSX-V Symbols: M and M.PR.A) announced today the closing of its previously announced public offering (the "Offering") of 7% convertible unsecured senior subordinated debentures (the "Debentures"). The Offering was underwritten by a syndicate of underwriters led by Canaccord Genuity Corp. and including GMP Securities L.P., Raymond James Ltd., Echelon Wealth Partners Inc., Industrial Alliance Securities Inc., AltaCorp Capital Inc., Cormark Securities Inc., Haywood Securities Inc. and Mackie Research Capital Corporation (collectively, the "Underwriters"). Pursuant to the Offering, $15,000,000 principal amount of the Debentures were issued.

The Debentures have a face value of $1,000 per Debenture and bear interest at a rate of 7.0% per annum, payable semi-annually in arrears on June 30 and December 31 in each year (each an "Interest Payment Date"), commencing on June 30, 2017, with a maturity date of December 31, 2021 (the "Maturity Date").

The Debentures are convertible into approximately 111.11 common shares of Mosaic (the "Shares") per $1,000 principal amount, at any time prior to the close of business on the earlier of the business day immediately preceding: (i) the Maturity Date; (ii) if called for redemption, the date fixed for redemption by Mosaic; or (iii) the payment date, if called for repurchase pursuant to a mandatory repurchase, at a conversion price of $9.00 per Share, subject to adjustment in certain events (the "Conversion Price"). Holders who convert their Debentures will receive, in addition to the applicable number of Shares, accrued and unpaid interest in respect thereof for the period from, and including, the most recent Interest Payment Date to, but excluding, the date of conversion.

The Debentures are not redeemable by Mosaic prior to December 31, 2019. On and after December 31, 2019, and prior to December 31, 2020, the Debentures may be redeemed in whole or in part from time to time at the option of Mosaic at par plus accrued and unpaid interest, provided that the volume-weighted average trading price of the Shares on the TSX Venture Exchange during the 20 consecutive trading days ending on the fifth trading day preceding the date on which the notice of redemption is given is not less than 125% of the Conversion Price. On and after June 30, 2020 and prior to the Maturity Date, Mosaic may, at its option, redeem the Debentures, in whole or in part, from time to time at par plus accrued and unpaid interest.

Subject to specified conditions, Mosaic will have the right to repay the outstanding principal amount of the Debentures, on maturity or redemption, through the issuance of Shares. Mosaic will also have the option in certain circumstances to satisfy its obligation to pay interest through the issuance and sale of additional Shares.

Mosaic will use the net proceeds from the Offering for general corporate purposes including future acquisitions, paying down existing credit facilities and working capital.

The Debentures issued under the Offering were offered by way of a short form prospectus supplement dated November 4, 2016 to its short form base shelf prospectus dated September 23, 2016, each of which has been filed under Mosaic's profile on SEDAR at www.sedar.com. The Debentures are expected to be listed and posted for trading on the TSX Venture Exchange under the symbol "M.DB" at the open of markets today.

The Debentures and the Shares issuable on conversion thereof 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 and the expected date and time the Debentures commence trading on the TSX Venture Exchange. 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: 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: prevailing economic conditions; unexpected changes in the financial markets (including in the trading price of the securities of Mosaic); 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 short form prospectus supplement dated November 4, 2016 to its short form base shelf prospectus dated September 23, 2016, and Mosaic's 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

For further information: Allan Fowler, Chief Financial Officer, Mosaic Capital Corporation, 400, 2424 - 4th Street SW, Calgary, AB T2S 2T4, Tel: (403) 270-4663


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