TORONTO, Dec. 5, 2013 /CNW/ - Equity Financial Holdings Inc. (TSX: EQI)
("Equity" or the "Corporation") announced today that it has selected
March 28, 2014 as the date for its annual general meeting of
shareholders and a special meeting of shareholders requisitioned by a
partnership controlled by Smoothwater Capital Corporation
("Smoothwater"). The record date for determining shareholders entitled
to receive notice of and vote at the meeting has been set as February 26, 2014. The Corporation will provide important information about the
meeting and the text of Smoothwater's proposed resolution in a
management information circular that will be mailed to shareholders and
posted to the Corporation's website and SEDAR in due course.
As disclosed in the Corporation's press release of November 18, 2013,
Smoothwater has requisitioned a special meeting of shareholders for the
purpose of removing seven of nine incumbent directors and appointing
three new directors to form a board of five directors. Smoothwater has
announced that it is acting jointly with Nick Kyprianou and Darryl Ivan
(together with Smoothwater, the "Joint Actors") and intends that Mr.
Kyprianou be appointed CEO of Equity's subsidiary, Equity Financial
Trust Company ("Equity Trust") and that Mr. Ivan be appointed Chief
Risk Officer of Equity Trust. Messrs. Kyprianou's and Ivan's
employment in these positions was terminated in October, 2013 upon a
unanimous decision of the Board of Directors.
In response to Smoothwater's requisition, the Board of Directors of the
Corporation formed a special committee (the "Special Committee")
comprising Bradley Kipp, Thomas Spencer and Donald Wright, each of whom
is an independent director of Equity. The Special Committee's mandate
includes considering the strategic direction proposed by the Joint
Actors and alternatives thereto, all with a view to enhancing
shareholder value. The Special Committee has hired TD Securities Inc.
("TD Securities") as its financial advisor to assist in completing its
mandate.
The Special Committee is evaluating all realistic alternatives for
enhancing shareholder value, including the proposal put forward by the
Joint Actors. The Special Committee will evaluate the information
available to it with respect to the experience, capabilities and
relevant performance of the director nominees and management team
proposed by the Joint Actors as well as that of the current directors
and management team. In addition, the Special Committee has directed
TD Securities to commence work on a process to determine if superior
shareholder value can be realized through the implementation of a
strategic transaction with a third party. TD Securities will commence
this process as soon as possible.
As part of its process, the Special Committee will provide appropriate
disclosure updates to the market and expects to engage in discussions
with its shareholders to assist it in determining the course of action
that it will recommend to shareholders at the Special Meeting on March
28, 2014.
About Equity Financial Holdings Inc.
Equity is a Canadian financial services company serving the alternative
retail mortgage market through its federally regulated and wholly-owned
subsidiary, Equity Financial Trust Company. Learn more at www.equityfinancialholdings.com.
Forward Looking Information
Certain portions of this press release as well as other public
statements by the Corporation 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," "continue", "estimates," "scheduled,"
"anticipates," "believes," "intends," "may," and similar 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 Corporation's expectations
in respect of earnings, fee income, expense levels, general economic,
political and market factors in North America and internationally,
interest rates, global equity and capital markets, activities, the
Corporation's expected need for equity on debt financing, business
competition, technological change, changes in government regulations,
unexpected judicial or regulatory proceedings, catastrophic events, and
the Corporation's ability to complete strategic transactions and
integrate acquisitions and other factors.
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 the Corporation and the Canadian economy. Certain material
factors or assumptions are applied by the Corporation in making
forward-looking statements, including without limitation, factors and
assumptions regarding interest rates, availability of key personnel,
the effect of competition on the Corporation's business, government
regulation of its business, computer failure or security breaches,
future capital requirements, its ability to fund its mortgage business,
the value of mortgage originations, the competitive nature of the
alternative mortgage market, the expected margin between the interest
earned on its mortgage portfolio and the interest to be paid on its
deposits, the relative continued health of real estate markets,
acceptance of its products in the marketplace, as well as its operating
cost structure and the current tax regime.
Forward-looking statements reflect the Corporation'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 the Corporation'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 the Corporation, are inherently subject to significant
uncertainties and contingencies. Many factors could cause the
Corporation'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 a significant downturn in capital markets or the
economy as a whole, 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, inability to
raise funds through public or private financing significant changes in
interest rates, failure by Equity Financial Trust Company ("EFT") to
meet ongoing regulatory requirements, the failure of borrowers or
counterparties to honour their financial or contractual obligations to
EFT, failure by EFT to adequately monitor and/or adjust its mortgage
portfolio management practices for changing circumstances, failure by
the Corporation to attract and to retain the necessary employees to
meet its needs, failure by EFT to adequately monitor the services
provided by third party service providers or to establish alternative
arrangements if required, failure by EFT to secure sufficient deposits
from securities dealers or a sufficient level of mortgage origination
from its mortgage broker network, a failure of the computer systems of
the Corporation or one or more of its service providers or the risks
detailed from time-to-time in the Corporation's quarterly filings,
annual information forms, annual reports and annual filings with
securities regulators. The preceding list is not exhaustive of possible
factors. The Corporation 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 laws.
SOURCE Equity Financial Trust
