Montfort Capital Corporation, a provider of focused private credit strategies for institutional investors, family offices, and wealth managers, announced an up to C$200 million senior secured, revolving credit facility for its wholly-owned subsidiary Brightpath Capital Corporation (“Brightpath”) from funds managed by Atalaya Capital Management LP (“Atalaya”). Brightpath intends to use the credit facility to finance its current portfolio and future originations. The Credit Facility provides for an initial commitment of C$100 million, which Brightpath has the option to increase to C$200 million, subject to consent of Atalaya. The Credit Facility has a term of 36 months.

“Brightpath has built an impressive origination and servicing platform in the Canadian mortgage market. Brightpath has a unique business model and generates attractive assets that provide utility to underserved Canadian consumers,” said Daniel Rosato, Managing Director at Atalaya. “We look forward to supporting Brightpath’s growth plans with this credit facility.”

“This partnership with Atalaya aligns Brightpath with a highly-regarded global asset manager,” said Blake Albright, CEO of Brightpath and Chief Capital Officer of Montfort Capital. “Atalaya has taken the time to deeply understand our business and the market opportunity in Canada.  We are excited to be working with the team at Atalaya to scale Brightpath by capturing this opportunity.”

The Credit Facility will bear interest at a floating rate equal to the Canadian Overnight Repo Rate Average (“Adjusted Daily Compounded CORRA”) plus a commercially reasonable credit spread. Interest will be paid bi-monthly commencing on April 5, 2024 and draws under the Credit Facility will end on April 1, 2027 with the Credit Facility having a final maturity date of April 1, 2028.

Each of Atalaya and its affiliates is an arm’s length party to the Company and Brightpath, and the Company is not guaranteeing the loan or pledging any collateral under the Credit Facility other than a limited recourse guarantee and pledge providing a security interest in the shares held by the Company in Brightpath II Servicing Corporation (the general partner of Brightpath Residential Mortgage LP II (the “SPV”)). Brightpath has provided a limited recourse guarantee and pledge providing a security interest in the SPV. The Credit Facility is not convertible into common shares of the Company.

Edgar Matthews & Co. LLC served as exclusive financial advisor to Brightpath on the transaction.