M-Split Corp.
TSX : XMF
TSX : XMF.PR.A

M-Split Corp.

March 19, 2010 13:01 ET

M Split Corp. Announces Effective Date of Reorganization

TORONTO, ONTARIO--(Marketwire - March 19, 2010) - M Split Corp. (the "Company") today announced that the reorganization previously approved by shareholders (the "Reorganization") will be effective on March 23, 2010.

At the opening of trading on March 23, 2010, holders of Priority Equity Shares (Symbol: XMF.PR.A) will have received the following securities in exchange for each Priority Equity Share held:

  1. One $5.00 Class I Preferred Share (Symbol: XMF.PR.B) (the "Class I Preferred Share");

  2. One $5.00 Class II Preferred Share (Symbol: XMF.PR.C) (the "Class II Preferred Share");

  3. One 2011 Warrant (Symbol: XMF.WT); and

  4. One 2012 Warrant (Symbol: XMF.WT.A).

As previously announced, since more Priority Equity Shares were tendered for retraction under the special retraction right than Class A Shares, the outstanding Class A Shares will effectively be consolidated (the "Consolidation") through an adjustment to the number of Capital Shares to be issued to holders of Class A Shares in the Reorganization. The Consolidation will be implemented so that following the Reorganization, there will be an equal number of Capital Shares, Class I Preferred Shares and Class II Preferred Shares outstanding.

As a result of the Reorganization and the Consolidation, holders of Class A Shares (Symbol: XMF) will receive 0.944808 of a Capital Share (Symbol: XMF.A) in exchange for each Class A Share held.

The following is a summary of some of the principal provisions of the Class I Preferred Shares, Class II Preferred Shares, 2011 Warrants, 2012 Warrants and Capital Shares:

Class I Preferred Shares

Each Class I Preferred Share (Symbol: XMF.PR.B) pays fixed cumulative preferential monthly dividends to yield 7.50% per annum on the $5.00 notional issue price and having a repayment objective on December 1, 2014 or such other date as the Company may be terminated (the "Termination Date") of $5.00.

Class II Preferred Shares

Each Class II Preferred Share (Symbol: XMF.PR.C) pays distributions to yield 7.50% per annum on the $5.00 notional issue price if and when the net asset value per Unit exceeds $12.50 and having a repayment objective on the Termination Date of $5.00. Each "Unit" consists of one Class I Preferred Share, one Class II Preferred Share and one Capital Share.

2011 Warrant

Each 2011 Warrant (Symbol: XMF.WT) can be exercised to purchase one Unit for an exercise price of $10.00 per Unit at specified times until February 28, 2011.

2012 Warrant

Each 2012 Warrant (Symbol: XMF.WT.A) can be exercised to purchase one Unit for an exercise price of $12.50 per Unit at specified times until February 28, 2012.

Capital Shares

Capital Shares (Symbol: XMF.A) will continue to participate in any net asset value growth over $10.00 per Unit and dividends would be reinstated only if and when the net asset value per Unit exceeds $15.00. The dividend rate on the Capital Shares will be set by the Board of Directors of the Company at its discretion, based on market conditions. No dividend payments will be made on the Capital Shares unless all dividends on the Class I Preferred Shares and, if applicable, Class II Preferred Shares have been declared and paid.

For additional information regarding the provisions attached to the Class I Preferred Shares, Class II Preferred Shares, 2011 Warrants, 2012 Warrants and Capital Shares, reference should be made to the Company's Management Information Circular dated December 23, 2009.

The current portfolio of M Split is 99% in cash with a 1% holding in Manulife common shares. The Company will initiate its full investment plan and increase its investment in Manulife common shares and its supplemental covered call writing program beginning on March 23, 2010.

The Company will provide the actual opening net asset value per unit on the effective date of the Reorganization.

Contact Information

  • M Split Corp.
    Investor Relations
    416-304-4443 or Toll Free: 1-877-4-Quadra (1-877-478-2372)
    www.M-Split.com