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2019 Annual Information Form

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2019 Annual Information Form TERRA FIRMA CAPITAL CORPORATION ANNUAL INFORMATION FORM For the year ended December 31, 2019 April 2, 2020 TABLE OF CONTENTS Page MEANING OF CERTAIN REFERENCES .................................................................................................................. 1 FORWARD-LOOKING STATEMENTS ..................................................................................................................... 1 GLOSSARY OF TERMS .............................................................................................................................................. 2 CORPORATE STRUCTURE ....................................................................................................................................... 5 Name, Address and Incorporation .................................................................................................................. 5 Inter-corporate Relationship ........................................................................................................................... 5 GENERAL DEVELOPMENT OF THE BUSINESS OF THE COMPANY ................................................................ 6 Three Year History .......................................................................................................................................... 6 2017 ................................................................................................................................................................ 6 2018 ................................................................................................................................................................ 7 2019 ................................................................................................................................................................ 8 Significant Acquisitions ................................................................................................................................. 9 Outlook for 2019 ............................................................................................................................................ 9 BUSINESS OF THE COMPANY ............................................................................................................................... 10 General .......................................................................................................................................................... 10 Objectives of the Company ........................................................................................................................... 10 U.S. Operations ............................................................................................................................................. 12 Specialized skill and Knowledge................................................................................................................... 12 Cycles ........................................................................................................................................................... 12 REAL ESTATE LENDING ....................................................................................................................................... 12 Lending market in U.S .................................................................................................................................. 12 Lending market in Canada ............................................................................................................................ 12 Licensing and Legislative Regime ............................................................................................................... 13 TARGETED INVESTMENTS ................................................................................................................................... 14 General .......................................................................................................................................................... 14 Loan and Mortgage Investments ................................................................................................................... 14 Land Banking ................................................................................................................................................ 15 Equity-type financing and Joint Arrangements ............................................................................................. 15 INVESTMENT PORTFOLIO ..................................................................................................................................... 16 Loan Portfolio ............................................................................................................................................... 17 Investment in Finance Lease ......................................................................................................................... 17 Investments in Associates ............................................................................................................................. 17 Portfolio Investments .................................................................................................................................... 18 Joint Arrangements ....................................................................................................................................... 18 Convertible Note Receivable ......................................................................................................................... 18 INVESTMENT PROCESS ......................................................................................................................................... 18 General .......................................................................................................................................................... 18 Investment Criteria ........................................................................................................................................ 20 Investment Strategy ....................................................................................................................................... 20 LOAN SYNDICATIONS ............................................................................................................................................ 22 General .......................................................................................................................................................... 22 Syndication Strategy ..................................................................................................................................... 22 Borrowing Strategy ....................................................................................................................................... 23 Credit Facility ................................................................................................................................................ 23 COMPETITIVE ADVANTAGES .............................................................................................................................. 23 Strong Management with Key Industry Experience ...................................................................................... 23 Focused Business Model ............................................................................................................................... 24 TABLE OF CONTENTS (continued) Page Alignment of Interests ................................................................................................................................... 24 Strong Governance ........................................................................................................................................ 24 Prudent Growth ............................................................................................................................................. 24 Conservative Capital Management................................................................................................................ 24 DIRECTORS AND MANAGEMENT OF THE COMPANY .................................................................................... 24 Governance and Board of Directors .............................................................................................................. 24 Committees of the Board ............................................................................................................................... 25 Senior Management and Employees ............................................................................................................. 28 Cease Trade Orders, Bankruptcies, Penalties or Sanctions ........................................................................... 28 DESCRIPTION OF CAPITAL STRUCTURE AND DEBT PROFILE ..................................................................... 29 Loan and Mortgage syndications................................................................................................................... 29 Mortgages payable ........................................................................................................................................ 29 Credit Facility ................................................................................................................................................ 29 Shares ...........................................................................................................................................................
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