Sachem Capital Corp. (NYSE American: SACH) today closed on the
sale of $25 million aggregate principal amount of its 7.75%
unsecured, unsubordinated notes due 2025 (“Notes”). The gross
proceeds of the offering to Sachem Capital Corp. are $24.75 million
and the net proceeds, after payment of underwriting discounts and
commissions, are approximately $23.95 million. The Notes are a
further issuance of, rank equally in right of payment with and form
a single series for all purposes under the indenture governing the
Notes with the $28.36 million aggregate principal amount of 7.75%
Notes due 2025 that the company issued in September 2020 and
October 2020 (collectively referred to as the “2025 Notes”). The
Notes have been approved for listing on the NYSE American and will
trade under the symbol “SCCC,” the same trading symbol for the
other 2025 Notes, starting today.
Sachem Capital Corp. has granted the underwriters a 30-day
option to purchase up to an additional $3.75 million aggregate
principal amount of Notes to cover over-allotments, if any. The
over-allotment option expires January 17, 2021.
The Notes and 2025 Notes rank pari passu with the company’s
other unsecured, unsubordinated indebtedness, whether currently
outstanding or issued in the future. Including the Notes, Sachem
currently has an aggregate of approximately $111.3 million
unsubordinated, unsecured notes outstanding.
The Notes will mature on September 30, 2025, and may be
redeemed, in whole or in part, at any time, or from time to time,
at the company’s option on or after September 4, 2022. Interest on
the Notes will accrue at the annual rate of 7.75% and will be
payable quarterly, in arrears, on each March 30, June 30, September
30 and December 30 that the Notes are outstanding, beginning March
30, 2021.
Sachem plans to use the net proceeds from the sale of the Notes
for working capital and general corporate purposes, i.e., primarily
to fund new real estate loans secured by first mortgage liens.
Sachem may also use the net proceeds to acquire other real estate
finance companies or existing mortgage loan portfolios, although no
such transactions are pending at this time.
The Notes have a private rating of BBB+ from Egan-Jones Ratings
Company, an independent, unaffiliated rating agency. Egan-Jones is
a Nationally Recognized Statistical Ratings Organization (NRSRO)
and is recognized by the National Association of Insurance
Commissioners (NAIC) as a Credit Rating Provider (CRP). Egan-Jones
is also certified by the European Securities and Markets Authority
(ESMA). A securities rating is not a recommendation to buy, sell or
hold securities and may be subject to revision or withdrawal at any
time.
Ladenburg Thalmann & Co. Inc., Janney Montgomery Scott LLC
and National Securities Corporation, a wholly owned subsidiary of
National Holdings Corporation (NASDAQ: NHLD), acted as the lead
joint book-running managers for the offering.
The offering and sale of the Notes was made solely pursuant to
an effective registration statement relating to, among other
things, the Notes, and a related prospectus supplement, dated
December 18, 2020, which contains a detailed description of the
Notes and the terms of the offering, and an accompanying base
prospectus, dated February 5, 2020, which, among other things,
contains other important information about Sachem Capital Corp.,
its business, operations and financial condition. Copies of the
prospectus supplement and the accompanying base prospectus, which
form a part of the effective registration statement, may be
obtained from any of: Ladenburg Thalmann, Attn: Syndicate
Department, 277 Park Avenue, 26th Floor, New York, NY 10172, or by
emailing prospectus@ladenburg.com (telephone number
1-800-573-2541); Janney Montgomery Scott LLC by emailing
prospectus@janney.com; National Securities Corp., 200 Vesey Street,
25th Floor, New York, NY 10281, or by emailing
prospectusrequest@nationalsecurities.com.
This press release does not constitute an offer to sell or the
solicitation of an offer to buy the securities in this offering or
any other securities nor will there be any sale of the Notes or any
other securities referred to in this press release in any state or
jurisdiction in which such offer, solicitation or sale would be
unlawful prior to the registration or qualification under the
securities laws of such state or jurisdiction.
About Sachem Capital Corp.
Sachem Capital Corp. specializes in originating, underwriting,
funding, servicing, and managing a portfolio of first mortgage
loans. It offers short term (i.e., three years or less) secured,
nonbanking loans (sometimes referred to as “hard money” loans) to
real estate investors to fund their acquisition, renovation,
development, rehabilitation or improvement of properties located
primarily in Connecticut. The company does not lend to owner
occupants. The company’s primary underwriting criteria is a
conservative loan to value ratio. The properties securing the
company’s loans are generally classified as residential or
commercial real estate and, typically, are held for resale or
investment. Each loan is secured by a first mortgage lien on real
estate. Each loan is also personally guaranteed by the principal(s)
of the borrower, which guaranty may be collaterally secured by a
pledge of the guarantor’s interest in the borrower. The company
also makes opportunistic real estate purchases apart from its
lending activities. The company believes that it qualifies as a
real estate investment trust (REIT) for federal income tax purposes
and has elected to be taxed as a REIT beginning with its 2017 tax
year.
Forward Looking Statements
This press release may contain forward-looking statements. All
statements other than statements of historical facts contained in
this press release, including statements regarding the company’s
future results of operations and financial position, strategy and
plans, and its expectations for future operations, are
forward-looking statements. The words “anticipate,” “estimate,”
“expect,” “project,” “plan,” “seek,” “intend,” “believe,” “may,”
“might,” “will,” “should,” “could,” “likely,” “continue,” “design,”
and the negative of such terms and other words and terms of similar
expressions are intended to identify forward- looking
statements.
These forward-looking statements are based on the company’s
current expectations and projections about future events and trends
that the company believes may affect its financial condition,
results of operations, strategy, short-term and long-term business
operations and objectives and financial needs. These
forward-looking statements are subject to several risks,
uncertainties and assumptions as described in the company’s Annual
Report on Form 10-K for 2019 filed with the U.S. Securities and
Exchange Commission on March 30, 2020. Because of these risks,
uncertainties and assumptions, the forward-looking events and
circumstances discussed in this press release may not occur, and
actual results could differ materially and adversely from those
anticipated or implied in the forward-looking statements.
You should not rely upon forward-looking statements as
predictions of future events. Although the company believes that
the expectations reflected in the forward-looking statements are
reasonable, it cannot and does not guarantee future results, level
of activity, performance or achievements. In addition, neither the
company nor any other person assumes responsibility for the
accuracy and completeness of any of these forward-looking
statements. The company disclaims any duty to update any of these
forward-looking statements.
All forward-looking statements attributable to the company are
expressly qualified in their entirety by these cautionary
statements as well as others made in this press release. You should
evaluate all forward-looking statements made by the company in the
context of these risks and uncertainties.
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version on businesswire.com: https://www.businesswire.com/news/home/20201222005572/en/
Investor & Media Contact: Crescendo Communications,
LLC David Waldman Email: sach@crescendo-ir.com Tel: (212)
671-1021
Sachem Capital (AMEX:SCCC)
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Sachem Capital (AMEX:SCCC)
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