Canadian Life Companies Split Corp. Announces Details of Capital Reorganization
April 24 2012 - 4:28PM
Marketwired
Canadian Life Companies Split Corp. (the "Company") previously
announced that a special resolution to reorganize the Company had
been approved at the special meeting of the shareholders (the
"Shareholders") held on April 16, 2012.
As part of the capital reorganization, the Company will be
creating one new class of shares to be designated as 2012 Preferred
Shares, and two series of warrants (the "2013 Warrants" and the
"2014 Warrants") to acquire one 2012 Preferred Share and one Class
A Share (together, a "Unit"). It is intended that the 2012
Preferred Shares, 2013 Warrants and 2014 Warrants will be issued on
or about June 28, 2012, and will commence trading on the TSX at the
opening of trading on such date.
Holders of the existing Preferred Shares will receive the
following securities for each Preferred Share held on or about June
28, 2012 (the "Conversion Date"):
One 2012 Preferred Share - paying fixed cumulative preferential
monthly dividends to yield 6.25% per annum on the $10.00 nominal
issue price and having a repayment objective on the termination
date of $10.00;
One 2013 Warrant - each 2013 Warrant can be exercised to
purchase one Unit for an exercise price of the lesser of $13.25 and
103% of the net asset value of the Company on the Conversion Date
(the "2013 Warrant Subscription Price") on any business day during
the period commencing at market open (Eastern time) on the day
following the Conversion Date and ending at 5:00 p.m. (Eastern
time) on June 3, 2013; and
One 2014 Warrant - each 2014 Warrant can be exercised to
purchase one Unit for an exercise price of 105% of the 2013 Warrant
Subscription Price on any business day during the period commencing
at market open (Eastern time) on the day following the Conversion
Date and ending at 5:00 p.m. (Eastern time) on June 2, 2014.
Class A Shareholders will continue to hold their current Class A
Shares and would participate in any further increases in the net
assets over $10.00 per Unit.
In connection with the reorganization, the Company's investment
manager, Quadravest Capital Management Inc. ("Quadravest"), will be
lowering its annual management fee from 0.85% to 0.75% per annum of
the net asset value of the Company. In addition, the discount to
net asset value applicable to monthly redemptions of Shares will be
decreased from 4% to 2% and the amount of this reduced discount
would be paid to Quadravest and not retained by the Company. These
measures are intended to lower ongoing expenses of the Company and
improve trading prices relative to the net asset value for the
Company.
Shareholders are being given a special retraction right (the
"2012 Special Retraction Right") as a result of the approval of
this capital reorganization, which is in addition to the regular
monthly retraction at the end of April 2012 and the dissent rights
which Shareholders had in respect of the special meeting under the
Business Corporations Act (Ontario).
Shareholders who do not wish to remain invested in the Company
under its reorganized share structure will have until the close of
business on May 17, 2012 to provide the Company with notice through
their CDS participant that they wish to have their Preferred Shares
or Class A Shares redeemed pursuant to the 2012 Special Retraction
Right, and to surrender their Shares for retraction. On such a
special retraction, each holder of a Preferred Share will receive
the lesser of (i) $10.00 and (ii) the net asset value per Unit
calculated on May 31, 2012; while holder of a Class A Share will
receive the net asset value per Unit calculated on May 31, 2012,
less $10.00. Shareholders interested in exercising such retraction
right should contact the CDS Participant through which they hold
the Shares for further information and instructions as to how to
exercise this right. Shareholders should note that the requirements
of any particular CDS Participant may vary, and that Shareholders
may need to inform their CDS Participant of any intention to
exercise this retraction right in advance of the May 17 deadline.
Payment for the Class A Shares or Preferred Shares so tendered for
retraction pursuant to the 2012 Special Retraction Right will be
made no later than June 19, 2012.
If more Class A Shares are tendered for retraction under the
2012 Special Retraction Right than Preferred Shares, the
outstanding Preferred Shares will be consolidated so that following
the retraction pursuant to the 2012 Special Retraction Right there
would be an equal number of Preferred Shares and Class A Shares
outstanding. Similarly, if more Preferred Shares are tendered for
retraction than Class A Shares, the outstanding Class A shares will
be consolidated so that again there would be an equal number of
Preferred Shares and Class A Shares outstanding following
implementation of the 2012 Special Retraction Right. The Company
may implement this consolidation by adjusting the number of 2012
Preferred Shares, 2013 Warrants and 2014 Warrants to be issued to
holders of Preferred Shares, in the event a consolidation of
Preferred Shares is required.
Additional information regarding the capital reorganization is
contained in the Management Information Circular dated March 14,
2012 prepared in respect of the special meeting, available on SEDAR
at www.sedar.com or on the Company's website www.lifesplit.com.
Certain statements included in this news release constitute
forward-looking statements, including, but not limited to, those
identified by the expressions "expect", "intend", "will" and
similar expressions to the extent they relate to the Company. The
forward-looking statements are not historical facts but reflect the
Company's current expectations regarding future results or events.
These forward-looking statements are subject to a number of risks
and uncertainties that could cause actual results or events to
differ materially from current expectations. Although the Company
believes that the assumptions inherent in the forward-looking
statements are reasonable, forward-looking statements are not
guarantees of future performance and, accordingly, readers are
cautioned not to place undue reliance on such statements due to the
inherent uncertainty therein. The Company undertakes no obligation
to update publicly or otherwise revise any forward-looking
statement or information whether as a result of new information,
future events or other such factors which affect this information,
except as required by law.
Contacts: Canadian Life Companies Split Corp. Investor Relations
416-304-4443 or Toll Free at 1-877-4-Quadra (1-877-478-2372)
www.lifesplit.com
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