Mr. Y. Dov Meyer reports

TERRA FIRMA CAPITAL CORPORATION CLOSES BOUGHT DEAL OFFERING OF COMMON SHARES

Terra Firma Capital Corp. has completed the previously announced bought deal offering of 16,911,900 common shares of the company, inclusive of 2,205,900 common shares issued pursuant to exercise in full of the overallotment option granted to the underwriters, at a price of 85 cents per common share for aggregate gross proceeds to the company of $14,375,115. The offering was underwritten by a syndicate of underwriters led by Cormark Securities Inc. and including Beacon Securities Ltd. and Paradigm Capital Inc. The common shares are listed and posted for trading on the TSX Venture Exchange under the symbol TII.

Concurrently with the offering, the company completed a private placement of 1,205,883 common shares at a price of 85 cents per common share to certain insiders of the company, for gross proceeds to the company of $1,025,000. The common shares issued pursuant to the private placement will be subject to resale restrictions for a period of four months.

Given the participation of certain insiders of the company, the private placement constitutes a related-party transaction within the meaning of Multilateral Instrument 61-101 -- protection of minority securityholders in special transactions. Terra Firma has relied on an exemption to both the formal valuation and the minority shareholder approval requirements of MI 61-101, as neither the fair market value of the common shares to be distributed to, nor the fair market value of the consideration to be received by Terra Firma from, the insiders of the company in connection with the proposed private placement exceeds 25 per cent of Terra Firma's market capitalization.

The company has issued letters of intent and/or commitments in excess of $14-million to finance various real estate loans that are subject to certain financing conditions. The company intends to use the net proceeds from the offering and the private placement, to finance a portion of such commitments subject to borrowers meeting applicable financing conditions.

We seek Safe Harbor.