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Press release from Marketwire

MCAN Mortgage Corporation Announces Public Offering of Common Shares

Wednesday, March 30, 2011

MCAN Mortgage Corporation Announces Public Offering of Common Shares14:53 EDT Wednesday, March 30, 2011TORONTO, ONTARIO--(Marketwire - March 30, 2011) -NOT FOR DISTRIBUTION TO U.S. NEWS WIRE SERVICES OR DISSEMINATION IN THE UNITED STATES.MCAN Mortgage Corporation ("MCAN" or the "Company") (TSX:MKP) today announced that it has filed a preliminary short form prospectus with regulatory authorities in all provinces and territories of Canada, excluding Québec, in connection with a proposed public offering of up to 2 million common shares (the "Offering"). The Offering will be conducted through a syndicate of agents co-led by BMO Capital Markets and RBC Capital Markets and including National Bank Financial Inc. and Scotia Capital Inc. (the "Agents"). BMO Capital Markets will be acting as sole bookrunner for the Offering.The size and pricing of the Offering will be determined in the context of the market with final terms to be determined at the time of pricing. The common shares are being offered by the Agents, on behalf of the Company, on a "best efforts" basis.The Company has also granted the Agents an option (the "Over-Allotment Option") for the sale of up to that number of additional common shares that is equal to 15% of the Offering, to cover over-allotments, if any, and for market stabilization purposes. This option may be exercised by the Agents at any time, in whole or in part, until 30 days following the closing of the Offering.The Company expects to use the net proceeds of the Offering for investment in single family residential mortgages, construction loans and commercial term mortgages in the ordinary course of MCAN's business.The Company has been advised that C-CAP II Limited Partnership ("C-CAP"), an affiliate of CDP Capital-Conseil Immobilier Inc., has expressed an interest in selling the 1,276,363 common shares in the Company that it directly or indirectly holds (the "C-CAP Shares") at the same price per C-CAP Share as under the Offering. Pursuant to an agreement with BMO Capital Markets, and in accordance with applicable securities laws and regulations, C-CAP has agreed that the C-CAP Shares may, at BMO Capital Markets' sole discretion, be sold to purchasers under the Offering only once the offered common shares (including any common shares issuable upon the exercise of the Over-Allotment Option) have been fully allocated to purchasers pursuant to the Offering, and then only to purchasers under the Offering who have not otherwise been allocated the full amount subscribed for. C-CAP has also agreed with BMO Capital Markets that in the event that not all of the C-CAP Shares are sold as described above, C-CAP will not, without the prior written consent of BMO Capital Markets, sell, or agree to sell (or announce any intention to do so), any C-CAP Shares or securities exchangeable or convertible into common shares for a period of 90 days from the closing date of the Offering, except in limited circumstances.It is a condition of closing of the Offering that similar lock-ups be obtained from the officers and directors of the Company and from Raymond Doré, a significant shareholder of the Company.The Offering is expected to close on or about April 18, 2011 and is subject to the Company receiving all necessary regulatory approvals, including the approval of the Toronto Stock Exchange.The securities offered have not been registered under the U.S. Securities Act of 1933, as amended, and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements. This press release shall not constitute an offer to sell or the solicitation of an offer to buy nor shall there be any sale of the securities in any State in which such offer, solicitation or sale would be unlawful.MCAN is a public company listed on the Toronto Stock Exchange ("TSX") under the symbol MKP and is a reporting issuer in all provinces and territories in Canada.The Company's objective is to generate a reliable stream of income by investing its funds in a portfolio of mortgages (including single family residential, residential construction, non-residential construction and commercial loans), as well as other types of loans and investments, real estate and securitization investments. MCAN employs leverage by issuing term deposits eligible for Canada Deposit Insurance Corporation ("CDIC") deposit insurance up to a maximum of five times capital (on a non-consolidated basis) as permitted by the Income Tax Act (Canada). The term deposits are sourced through a network of independent financial agents. As a mortgage investment company, MCAN is entitled to deduct from income for tax purposes 50% of capital gains dividends and 100% of non-capital gains dividends paid by the Company. Such dividends are received by the shareholders as capital gains dividends and interest income, respectively.This press release may contain forward-looking statements, including statements regarding the expected closing date of the Offering, the expected use of proceeds of the Offering, and the business and anticipated financial performance of the Company. These forward looking statements can generally be identified as such because of the context of the statements and often include words such as the Company "believes", "anticipates", "expects", "plans", "estimates" or words of a similar nature. These statements are based on current expectations, and are subject to a number of risks and uncertainties that may cause actual results to differ materially from those contemplated by the forward-looking statements. Some of the factors that could cause such differences include legislative or regulatory developments, competition, technology change, global market activity, interest rates, changes in government and economic policy and general economic conditions in geographic areas where the Company operates. Reference is made to the risk factors disclosed in the Company's 2011 Annual Information Form, which are incorporated herein by reference. These and other factors should be considered carefully and undue reliance should not be placed on the Company's forward-looking statements. Subject to applicable securities law requirements, the Company does not undertake to update any forward-looking statements.FOR FURTHER INFORMATION PLEASE CONTACT: William JandrisitsMCAN Mortgage CorporationPresident and Chief Executive Officer(416) 591-2726ORTammy OldenburgMCAN Mortgage CorporationVice President and Chief Financial Officer(416) 847-3542mcanexecutive@mcanmortgage.comwww.mcanmortgage.com