Terra Firma Capital Corporation Completes Refinancing of Convertible Debentures

TORONTO, ONTARIO--(Marketwired - Sept. 29, 2014) - Terra Firma Capital Corporation (TSX VENTURE:TII) ("Terra Firma" or the "Company"), a real estate finance company, is pleased to announce that it has completed its previously announced non-brokered refinancing of its unsecured convertible subordinated debentures in the aggregate principal amount of $10,150,000 with an original maturity date of September 27, 2014 (the "2011 Debentures"), and issuance of new convertible unsecured subordinated debentures (the "New Debentures") in the aggregate principal amount of $10,850,000 (the "Refinancing").

The New Debentures bear interest at an annual rate of 7%, payable quarterly, and mature on September 29, 2017 (the "Maturity date"). At any time up to the Maturity Date, the New Debentures are convertible, in whole or in part, at the option of the holder into common shares of the Company (the "Common Share") at a price of $0.72 per Common Share (the "Conversion Price"). The Company may, at any time prior to the Maturity Date and upon giving notice (the "Redemption Notice"), prepay the New Debentures in full or in part, by paying the holders thereof the outstanding principal amount plus all accrued and unpaid interest, provided that the market price per Common Share on the date on which the Redemption Notice is provided is at least 125% of the Conversion Price. The Refinancing is subject to final approval by the TSX Venture Exchange (the "TSXV").

Holders of an aggregate $6,225,000 principal amount of the 2011 Debentures, including certain directors and officers of the Company holding an aggregate $800,000 principal amount, have directed the proceeds from the repayment and cancellation of their 2011 Debentures towards the subscription for an equivalent aggregate principal amount of the New Debentures. In addition, of the aggregate $4,625,000 principal amount of New Debentures that are not issued to holders of 2011 Debentures, who agreed to subscribe for an equivalent principal amount of New Debentures, certain directors and officers of the Company have subscribed for an aggregate $530,000 principal amount. The 2011 Debentures whose holders did not subscribe for an equivalent principal amount of New Debentures have also been repaid in full and cancelled, using net cash proceeds from the Refinancing. The remaining net cash proceeds of the Refinancing will be used to enhance Terra Firma's liquidity position, to fund Terra Firma's business activities and for other general corporate purposes.