AG Mortgage Investment Trust, Inc. (NYSE:MITT) submit a non binding proposal to acquire Western Asset Mortgage Capital Corporation (NYSE:WMC) from shareholders for $69.1 million on July 13, 2023. AG Mortgage Investment Trust, Inc. (NYSE:MITT) entered into a definitive merger agreement to acquire Western Asset Mortgage Capital Corporation (NYSE:WMC) from shareholders on August 8, 2023. The offer consists of a fixed exchange ratio (subject to adjustment based on certain transaction expenses of the parties, as described in the press release), representing an implied price of $9.88 per share, consisting of a common stock consideration of $8.90 per share and cash consideration of $0.98 per share as of July 12, 2023. The offer represents an 18.2% premium to WMC?s closing share price, all based on MITT and WMC stock prices as of July 12, 2023. MITT has approval from both of its board of directors and external manager Angelo, Gordon & Co., L.P. to make this proposal. MITT's proposal, reflecting an implied price of $9.88 per WMC share, is financially superior to the TPT deal because (1) it represents as 18.2% premium to WMC's closing price of $8.36 as of July 12, 2023 based on MITT's observable stock price, and (2) WMC shareholders will receive $0.98 per share of cash consideration whereas the TPT deal involves no cash. MTT's proposal is expected to be substantially accretive to earnings in the first year after closing. Upon completion of the merger, MITT?s President and Chief Executive Officer, T.J. Durkin, will serve as Chief Executive Officer of the combined company, which will continue to operate as ?AG Mortgage Investment Trust, Inc.? and be managed by AG REIT Management, LLC, an affiliate of Angelo Gordon. MITT?s Board of Directors will be increased from six to eight directors to include two WMC-designated directors. The combined company will be headquartered in New York and will continue to trade on the NYSE under MITT?s current ticker symbol. As of July 18, 2023, Western Asset Mortgage Capital Corporation 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. (NYSE: MITT)(?MITT?) to acquire WMC is reasonably expected to lead to a ?Parent Superior Proposal? within the meaning of WMC?s merger agreement with Terra Property Trust, Inc. As a result of the WMC board?s determination, WMC intends to engage in discussions with MITT regarding its proposal, in accordance with the terms of the merger agreement with TPT. In the event of a termination of the Merger Agreement under certain circumstances, including a change of recommendation or the acceptance of a superior proposal, MITT or WMC, as applicable, would be required to pay the other party a termination fee of, in the case of payment by WMC, $3,000,000 and, in the case of payment by MITT, $6,000,000.

The transaction has been unanimously approved by the Boards of Directors of MITT and WMC and external managers of MITT and WMC. The transaction is expected to close in the fourth quarter of 2023, subject to the respective approvals by the stockholders of MITT and WMC and other customary closing conditions set forth in the merger agreement. Piper Sandler & Co. is acting as exclusive financial advisor and fairness opinion provider and Hunton Andrews Kurth LLP is acting as legal counsel to MITT. BTIG, LLC and JMP Securities, a Citizens Company, are acting as financial advisors, and Thomas W. Greenberg, David J. Goldschmidt, Joe Penko and Sarah Beth Rizzo of Skadden, Arps, Slate, Meagher & Flom LLP is acting as legal advisor to WMC.