IMH Financial Corporation Planning a $50 Million Recapitalization Loan and Shareholder Tender Offer

According to IMH Financial Corporation’s latest SEC filing, the company entered into a funding commitment letter with NWRA Ventures I, LLC on April 20, 2011 to obtain a $50 million loan from MWRA for a period of five years at a rate of 17% per year. Under the terms of the arrangement, Shane Albers will resign from the company and receive a $550,000 severance payment, a renewable $20,000 per month “transitional consulting” fee and more than $200,000 in expense reimbursements.

In addition, IMH reported that NWRA plans to submit a cash tender offer to purchase up to $10 million worth of Class B or Class C shares from IMH stockholders. According to the SEC filing, the offer price is expected to be at “a substantial discount to the current book value per share of our common stock.”

Following completion of the loan closing, the company also intends to offer existing investors the opportunity to purchase an aggregate of $10 million of convertible notes.

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