Western Asset Mortgage Capital Corporation WMC (“WMC”) today announced that WMC’s board of directors has determined in good faith, after consultation with its financial advisors and outside legal counsel, that the unsolicited proposal from AG Mortgage Investment Trust, Inc. MITT (“MITT”) to acquire WMC is a “Parent Superior Proposal” within the meaning of WMC’s merger agreement with Terra Property Trust, Inc. (“TPT”).
Under the terms of MITT’s proposal, each outstanding share of WMC common stock would be converted into the right to receive (i) 1.468 shares of MITT common stock pursuant to a fixed exchange ratio (subject to adjustment for transaction expenses) and (ii) the per share portion of a cash payment from MITT’s external manager equal to the lesser of $7 million or approximately 9.9% of the aggregate per share merger consideration (any difference between $7 million and the 9.9% cap would be used to benefit the combined company post-closing by offsetting reimbursable expenses that would otherwise be payable to MITT’s external manager). Additionally, MITT’s external manager, which would be the manager of the combined company, would waive $2.4 million of management fees in the first year post-closing.
WMC has notified TPT that it intends to terminate their merger agreement unless WMC receives a revised proposal from TPT by 11:59 p.m. Eastern Time on August 3, 2023 such that the WMC board of directors determines that MITT’s proposal is no longer a Parent Superior Proposal, after taking into account all aspects of any such proposal WMC may receive from TPT.
Consistent with its fiduciary duties, the WMC board of directors conducted a thorough and rigorous review of the MITT proposal and the TPT merger agreement before making its determination regarding MITT’s proposal.
WMC’s merger agreement with TPT remains in full force and effect, and the WMC board has not withdrawn or modified its recommendation regarding the pending transaction with TPT. In…