Lindsey Morden Group Inc.
TSX : LM.SV

Lindsey Morden Group Inc.

July 26, 2005 08:47 ET

Lindsey Morden Announces Record Date and Expiry Date for Rights Offering

TORONTO, ONTARIO--(CCNMatthews - July 26, 2005) - THIS PRESS RELEASE IS INTENDED FOR DISTRIBUTION IN CANADA ONLY AND IS NOT INTENDED FOR DISTRIBUTION TO UNITED STATES NEWSWIRE SERVICES OR DISSEMINATION IN THE UNITED STATES.

(Note: All dollar amounts in this press release are expressed in Canadian dollars.)

Lindsey Morden Group Inc. (TSX:LM.SV) today announced that it has filed a final prospectus with securities regulators in all Canadian jurisdictions in connection with an offering of rights to purchase up to an additional 9,534,056 of its subordinate voting shares. Rights will be issued to the holders of its outstanding 12,128,256 subordinate voting shares and 2,172,829 multiple voting shares of record as of the close of business (Toronto time) on August 4, 2005 on the basis of one right for each subordinate voting share or multiple voting share held. A holder of rights will be entitled to subscribe, at or before 4:00 p.m. (Toronto time) on August 30, 2005, for one subordinate voting share at an exercise price of $4.25 for each 1.5 rights held.

Lindsey Morden does not intend to issue rights certificates to shareholders who are residents of jurisdictions outside of Canada, the United States or the United Kingdom. Instead, such shareholders' rights certificates will be held by CIBC Mellon Trust Company, the subscription agent for the rights offering, until 10 days prior to the expiry date to give beneficial owners an opportunity to establish their eligibility, after which the subscription agent will attempt, on a best efforts basis only, to sell such rights and distribute sale proceeds, if any, in accordance with the procedures set out in the final prospectus.

Fairfax Financial Holdings Limited, the beneficial owner of approximately 70.6% of Lindsey Morden's outstanding subordinate voting shares and all its multiple voting shares, has indicated that it intends to exercise all rights issued to it, which exercise would result in approximately $30.4 million in gross proceeds to Lindsey Morden. There is no stand-by commitment or soliciting dealer in connection with the rights offering.

If all rights are exercised, the rights offering is expected to raise total gross proceeds of approximately $40.5 million for Lindsey Morden. The full net proceeds of the rights offering will be used to partially repay the $105 million of borrowings by one of Lindsey Morden's subsidiaries under an unsecured non-revolving term credit facility.

The rights offering is subject to applicable regulatory approvals, including by the Toronto Stock Exchange. Upon receipt of those approvals, rights will be transferable and will be listed on the Toronto Stock Exchange.

Under Lindsey Morden's articles, an adjustment to the "minimum market price", a threshold used to determine the number of votes attached to its multiple voting shares for purposes of a particular shareholders' meeting, may be required depending on the number of subordinate voting shares issued under the rights offering. Assuming the maximum number of subordinate voting shares available under the rights offering are issued, the minimum market price would be adjusted from $4.00 to $3.84. That adjustment will be finalized as of the expiry date based on the number of subordinate voting shares that are actually issued and will be publicly announced as soon as practicable after closing.

This news release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful, prior to registration or qualification under the securities laws of any such state or jurisdiction.

Lindsey Morden Group Inc. is a holding company, which, thorough its Cunningham Lindsey subsidiaries, provides a wide range of independent insurance claims services, including claims adjusting, appraisal and claims and risk management services. It has a worldwide network of branches in Canada, the United States, the United Kingdom, continental Europe, the Far East, Latin America and the Middle East. Lindsey Morden also provides claims appraisal training courses in the United States.

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