Equity Financial and Smoothwater Capital Complete Plan of Arrangement; Hennick & Co and Others Complete Co-investment in Equity Post-Arrangement

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TORONTO, Dec. 21, 2017 /CNW/ - Equity Financial Holdings Inc. (TSX: EQI) ("Equity" or the "Corporation"), which offers residential mortgage loans through its wholly‐owned subsidiary, Equity Financial Trust Company ("Equity Trust") and Smoothwater Capital Corporation ("Smoothwater") are pleased to announce that they have completed their previously announced plan of arrangement (the "Arrangement").

Pursuant to the Arrangement, Smoothwater has acquired all of the issued and outstanding shares of Equity ("Shares"), other than Shares already owned or controlled by Smoothwater, its officers, and by certain other shareholders who have agreed to remain as continuing shareholders. All shares were purchased for $10.25 per Share. 

In order to receive the cash consideration for their Shares, former shareholders entitled to such consideration must follow the instructions set out in the Corporation's management proxy circular dated November 17, 2017, as supplemented, and accompanying letter of transmittal, copies of which are available at www.sedar.com under the Corporation's profile.

In connection with the Arrangement, Equity has applied to have the Shares de-listed from the Toronto Stock Exchange and it is expected that the Shares will be de-listed on or about December 22, 2017. Equity is applying under applicable Canadian securities laws to cease to be a reporting issuer. 

Hennick & Company, Freycinet Ventures and certain other investors who had previously committed to contribute capital to support Equity's business have acquired a non-controlling interest in Equity, with Smoothwater maintaining control of the now privatized company.

About Equity Financial Holdings Inc.

The Corporation is a financial services company operating through its wholly‐owned subsidiary, Equity Trust, a federally regulated deposit‐taking institution. Equity Trust serves the Canadian mortgage market by offering residential mortgage loans to non‐prime and near‐prime customers who do not meet the conventional underwriting standards of the major Canadian banks. Learn more at http://equityfinancialtrust.com.

About Smoothwater Capital Corporation

Smoothwater focuses on investing its own capital in small to midcap Canadian public companies where there is an identifiable path to significantly improve the share value. Learn more at http://www.smoothwatercapital.com.

Forward looking information

Certain portions of this press release as well as other public statements by Equity contain "forward-looking information" within the meaning of applicable Canadian securities legislation, which is also referred to as "forward-looking statements", which may not be based on historical fact. Wherever possible, words such as "will", "plans," "expects," "targets," "continues", "estimates," "scheduled," "anticipates," "believes," "intends," "may," "could," "would" or might, and the negative of such expressions or statements that certain actions, events or results "may," "could," "would," "might" or "will" be taken, occur or be achieved, have been used to identify forward-looking information. Such forward-looking statements include, without limitation, the fact that and the timing of the Shares being de-listed from the Toronto Stock Exchange, the application to cease to be a Reporting Issuer, and the ability of Equity and Hennick & Company, Freycinet Ventures, and other investors to complete the acquisition of a non-controlling interest in Equity from Smoothwater, and other factors. Forward-looking statements should not be read as guarantees of future events, future performance or results, and will not necessarily be accurate indicators of the times at, or by which, such events, performance or results will be achieved, if achieved at all.

All material assumptions used in making forward-looking statements are based on management's knowledge of current business conditions and expectations of future business conditions and trends, including their knowledge of the current credit, interest rate and liquidity conditions affecting Equity and the Canadian economy, retail mortgage markets, housing sales and capital markets. Certain material factors or assumptions are applied by Equity in making forward-looking statements, including without limitation, the anticipated benefits of the Amended Arrangement remaining the same.

Forward-looking statements reflect Equity's current views with respect to future events and are subject to a number of risks and uncertainties. Actual results may differ materially from results contemplated by the forward-looking statements. Readers should not place undue reliance on such forward-looking statements, as they reflect Equity's current views with respect to future events and are subject to risks and uncertainties and are necessarily based upon a number of estimates and assumptions that, while considered reasonable by Equity, are inherently subject to significant business, economic, regulatory, competitive, political and social uncertainties and contingencies. Many factors could cause Equity's actual results, performance or achievements to be materially different from any future results, performance, or achievements that may be expressed or implied by such forward-looking statements, including among others, the anticipated benefits of the Amended Arrangement changing, a significant downturn in capital markets or the economy as a whole, errors or omissions by Equity in providing services to its customers, significant increases in the cost of complying with applicable regulatory requirements, civil unrest ,economic recession, pandemics, war and acts of terrorism which may adversely impact the North American and global economic and financial markets, significant changes in interest rates, failure by Equity Trust to meet ongoing regulatory requirements, the failure of borrowers or counterparties to honour their financial or contractual obligations to Equity Trust, failure by Equity Trust to adequately monitor and/or adjust its mortgage portfolio management practices for changing circumstances, failure by Equity Trust to adequately monitor the services provided by third party service providers or to establish alternative arrangements if required or the risks detailed from time-to-time in Equity's quarterly filings, annual information forms, annual reports and annual filings with securities regulators. The preceding list is not exhaustive of possible factors. Equity disclaims any intent or obligation to update or revise publicly any forward-looking statements whether as a result of new information, estimates, future events or results, or otherwise, unless required to do so by applicable law. The forward-looking statements contained herein are expressly qualified in their entirety by this cautionary statement.

SOURCE Equity Financial Holdings Inc.

Equity Financial Holdings Inc.: Michael R. Jones, President & CEO, 647.277.0106, [email protected]; Smoothwater Capital Corporation: Stephen J. Griggs, Chief Executive Officer, 416.986.2207, [email protected]