Mulvihill Pro-AMS RSP Split Share Corp.

Mulvihill Pro-AMS RSP Split Share Corp.
Mulvihill Capital Management Inc.

Mulvihill Capital Management Inc.

January 04, 2005 16:03 ET

Mulvihill Pro-AMS RSP Split Share Corp. Declares Monthly Distribution and Provides Additional Distribution Guidance


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: MULVIHILL PRO-AMS RSP SPLIT SHARE CORP.

TSX SYMBOL: SPL.A
TSX SYMBOL: SPL.B

JANUARY 4, 2005 - 16:03 ET

Mulvihill Pro-AMS RSP Split Share Corp. Declares
Monthly Distribution and Provides Additional
Distribution Guidance

TORONTO, ONTARIO--(CCNMatthews - Jan. 4, 2005) - Mulvihill Pro-AMS RSP
Split Share Corp. (TSX:SPL.A)(TSX:SPL.B) (the "Fund") has declared its
monthly distribution of $0.05417 on each of its Class A Shares payable
January 31, 2005 to shareholders of records as of January 17, 2005.
Further to the press release on December 2, 2004, distributions on the
Class B Shares have been suspended. The fees payable to the investment
manager have also been further reduced and deferred to reflect the
reduction in the distribution from 0.65% to 0.40% of the net asset value
per annum.

Mulvihill Capital Management has revisited the level of the managed
portfolio (less the present value of the Class A share forward
agreements) where it would be required to suspend distributions to the
Class B shareholders as per the terms of the original prospectus and
rating covenants. This level will be reviewed regularly and is currently
determined to be $7.75. It is anticipated that this level will decline
over time as additional Class A forward agreements are transacted with
The Royal Bank of Canada. For comparative purposes the current level of
the managed portfolio is $8.09.

The Fund's investment objectives for the Class A Shares are to provide
Class A Shareholders with fixed cumulative preferential monthly cash
distributions in the amount of $0.05417 per Class A Share (6.5% per
annum on the original issue price) and to pay such Shareholders $10.00
for each Class A Share held on redemption on December 31, 2013 (the
"Termination Date").

The Fund's investment objectives with respect to the Class B Shares are
to provide Class B Shareholders with monthly cash distributions targeted
to be 8.5% per annum; to pay such holders $20.00 for each Class B Share
held on the redemption of the Class B Shares on the Termination Date;
and on the Termination Date, to provide holders of Class B Shares with
the balance of the value of the Fund's Managed Portfolio (described
below) after paying Class A Shareholders $10.00 per Class A Share.

To further enhance the Fund's ability to return the original issue price
of Class A Shares on termination, the Fund contributes, every six months
(commencing September 30, 2002) an amount targeted to be a minimum of
$0.43 per Class A Share outstanding representing 1/23rd of the issue
price of a Class A Share, to an account (the "Class A Share Forward
Account") which will be used to acquire Canadian equity securities. The
Fund will at each such time enter into a forward purchase and sale
agreement (each a "Class A Share Forward Agreement") with Royal Bank of
Canada ("RBC") until the forward price that would be payable to the Fund
under the Class A Share Forward Agreements on the Termination Date
equals the Class A share issue price ($10.00) multiplied by the number
of Class A Shares outstanding.

To provide the Fund with the means to return the original issue price of
the Class B Shares on termination, the forward purchase and sale
agreement remains in force with RBC pursuant to which RBC will agree to
pay to the Fund an amount equal to $20.00 in respect to each Class B
Share outstanding on the Termination Date in exchange for the Fund
agreeing to deliver to RBC equity securities known as the Fixed
Portfolio. The balance of the net proceeds of the offering (i) have been
invested by the Fund in a diversified portfolio consisting principally
of Canadian and U.S. equity securities that are listed on a major North
American stock exchange or market whose issues have a market
capitalization in excess of U.S. $5.0 billion if listed solely in the
United States or a market capitalization in excess of Cdn. $1 billion if
listed in Canada and (ii) will also be used to enter into the Class A
Shares Forward Agreements (collectively, the "Managed Portfolio").

The Fund may, from time to time, write covered call options in respect
of all or part of the securities in the Managed Portfolio. In addition,
the Fund may write cash covered put options in respect of securities in
which the Fund is permitted to invest.

The Class A Shares trade under the symbol SPL.A, and the Class B Shares
trade under the symbol SPL.B on the Toronto Stock Exchange.



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Distribution Details:
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Distribution per Class A Share: $0.05417
Distribution Per Class B Share: $nil
Payable Date: January 31, 2005
Record Date: January 17, 2005
Ex-Dividend Date: January 13, 2005
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Contact Information

  • FOR FURTHER INFORMATION PLEASE CONTACT:
    Mulvihill Structured Products
    John Mulvihill
    President & CEO
    (416) 681-3966 or (800) 725-7172
    or
    Mulvihill Structured Products
    Bruce Graham
    Vice President
    (416) 681-3966 or (800) 725-7172
    hybrid@mulvihill.com
    www.mulvihill.com
    A member of the Mulvihill Capital Management Inc. Group of Funds