Sentry Select Capital Corp.

Sentry Select Capital Corp.
C.A. Bancorp Inc.
TSX VENTURE : BKP

C.A. Bancorp Inc.

May 23, 2006 11:15 ET

C.A. Bancorp Inc. 'TSXV: BKP' Enters into Management and Administrative Agreements with Sentry Select Capital Corp.

TORONTO, ONTARIO--(CCNMatthews - May 23, 2006) - C.A. Bancorp Inc. (the "Company")(TSX VENTURE:BKP) announces that, as a result of the expansion of the scope and nature of the Company's business, it has entered into two agreements with Sentry Select Capital Corp. ("Sentry Select"), subject to regulatory approval.

Pursuant to the Management Agreement, among other things, Sentry Select will manage the Company's merchant banking business, including searching for, evaluating and screening investment opportunities and conducting due diligence with respect to potential investments. For the provision of its services pursuant to the Management Agreement, the Company will pay Sentry Select a quarterly fee (the "Management Fee") of 1/4 of 1.50% of the Net Asset Value (the total net asset value less the Company's liabilities) calculated as at the close of business on the last business day of each calendar quarter. In addition to the Management Fee, Sentry Select will be entitled to be paid a performance bonus (the "Performance Bonus") equal to 20% of the amount by which the annual Net Pre-Tax Profits of the Company (the non-consolidated net income of the Company before income taxes and such Performance Bonus) calculated as at December 31st in each year exceeds a threshold of an 8% per year return earned on the Company's Net Asset Value (determined in accordance with the Management Agreement). The initial term of the Management Agreement will commence on July 1, 2006 and expire on December 31, 2011. The Management Agreement will renew automatically for successive five-year terms following the initial term, provided that there has been no breach or material default of the terms of the agreement by Sentry Select, subject to termination on any expiry date upon not less than 180 days prior written notice from the Company or Sentry Select to the other. In the event that the Company terminates the Management Agreement, Sentry Select will be entitled to receive from the Company an amount equal to five times 1.5% of the Net Asset Value calculated as at the close of business on the last business day of the term of the Management Agreement and five times the Performance Bonus paid in respect of the calendar year immediately preceding the date of termination of the Management Agreement. The Management Agreement may also be terminated by either party upon the occurrence of certain events. Mr. John F. Driscoll, a director and the Chief Executive Officer of the Company, is the President, Chief Executive Officer and a director of Sentry Select, a privately held company beneficially owned by John F. Driscoll and his family.

The Amended Administrative Agreement amends and restates the administrative agreement of January 26, 2006 between the Company and Sentry Select. Effective as of July 1, 2006, Sentry Select will provide certain management and administrative services to the Company, including the provision of office space, equipment and all management and investment staff, and all accounting, clerical, secretarial, corporate and administrative services as may be reasonably necessary to perform its obligations under the Amended Administrative Agreement. The monthly fee paid to Sentry Select for the provision of such services will increase (from $35,000 to $40,000). The Amended Administrative Agreement will immediately terminate upon the termination for any reason of the Management Agreement.

The Company also wishes to announce the appointment on May 18, 2006 of Mr. Frank Potter to the board of directors of the Company. In accordance with the policies of the TSX Venture Exchange, Mr. Potter's appointment to the board of directors of the Company is subject to Exchange approval.



The Exchange Tower
130 King Street West
Suite 2805, P.O. Box 104
Toronto, Ontario M5X 1A4
Telephone: (416) 214-5985
Fax: (416) 364-2398


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