The Endurance Fund Corp.
TSX VENTURE : END.P

November 08, 2006 16:33 ET

The Endurance Fund Corporation: Press Release

TORONTO, ONTARIO--(CCNMatthews - Nov. 8, 2006) - Jason C. Monaco, President and CEO, Endurance Fund Corporation (the "Corporation") (TSX VENTURE:END.P), is pleased to announce that the Corporation has entered into a Letter of Intent dated November 3, 2006 with Universal Settlements International Inc. ("USI"). The Corporation has agreed to acquire all of the issued and outstanding common shares of USI in exchange for US$6 million in cash and the issuance of 36 million common shares of the Corporation (the "Acquisition").

The Corporation will apply to the TSX Venture Exchange (the "Exchange") in order to have the Acquisition, in conjunction with the Financing discussed below, considered to be an arm's length "Qualifying Transaction" for the purposes of Exchange Policy 2.4.

The Corporation had previously entered into a Letter of Intent with USI dated June 2, 2006 pursuant to which USI had agreed to act as an agent to source equity financing and to source, manage and provide other services related to a portfolio of life settlement policies, and; a Conditional Purchase Agreement to purchase from USI certain life settlement policies in the principal amount of US$4,500,000. The Corporation will now focus solely on closing the Acquisition.

About Universal Settlements International Inc.

USI is a private Ontario company based in Kitchener, Ontario, involved in various activities in the financial services industry relating to life settlement policies. During the three fiscal years ended April 30, 2005, 2004 and 2003, USI had revenues of $9,420,832, $7,293,128 and $1,486,274, respectively, for net income (losses) of $205,352, $14,110 and $(8,657) for the respective same periods. Total assets for these same periods were $966,007, $2,293,500, and $263,955 (all numbers are in CDN dollars, un-audited). USI currently has 14 employees.

Traditionally, policy owners of a life insurance contract can get access to the value built up in a policy, while they are living, by surrendering the policy for its cash value, withdrawing some of the accumulated surplus value (if there is any), or borrowing against the cash value.

Life settlements are a profitable alternative. With a life settlement, the owner of the policy can sell their beneficial interest in a policy for cash - a life settlement. The owner is then relieved from paying future premium obligations. Individuals and institutions can then participate by purchasing life settlements. USI's portfolio of life settlement policies originate in the United States and are held by a US domiciled trustee.

Life settlements are currently subject to regulation in more than 20 US states. Currently, more than US$9 trillion of life insurance policies are in force in the United States, of which US$150 billion are eligible for life insurance settlement. The life settlement industry in the US is currently valued at an estimated US$13 billion.

The principal shareholders of USI are Antonio Duscio, a resident of Kitchener, Ontario, Jeff Panos, a resident of Kilbride, Ontario and Chris Halas, a resident of Mississauga, Ontario. It is proposed that upon completion of the Transaction, new directors will be nominated to serve on the Board of Directors of the Corporation along with certain of the current board members.

Concurrent Financing

The Corporation will seek concurrent financing to facilitate the closing of the Acquisition. The Corporation intends to issue approximately 20 million common shares pursuant to a brokered private placement at US$1.00 per share, for gross proceeds of US$20 million (the "Financing", and together with the Acquisition, the "Transactions").

The Corporation will appoint First Canadian Capital Markets Limited ("FCCM"), a registered limited market dealer in Ontario, to act as agent in connection with the Financing, and will pay an agent's fee in respect of the Financing. The Corporation will use the net proceeds of the Financing to fund the Acquisition, to acquire other life settlement policies, and for working capital needs. Mr. Monaco and Nick Tsimidis are currently directors of both FCCM and the Corporation.

Conditions

The completion of the Transaction is subject to a number of conditions, including:

(i) obtaining all regulatory approvals;

(ii) obtaining all shareholder and director approvals;

(iii) completion of a due diligence review by each party to the Acquisition; and

(iv) completion of documentation satisfactory to each party.

Listing

Concurrently with the completion of the Transactions, the Corporation intends to apply to become a Tier 1 issuer as an Investment Company on the Exchange.

Completion of the Transactions are subject to a number of conditions, including but not limited to, Exchange acceptance and if applicable pursuant to Exchange Requirements, majority of the minority shareholder approval. Where applicable, the Transactions cannot close until the required shareholder approval is obtained. In addition, other conditions include all other necessary regulatory, court and third party approvals and authorizations, the completion of a definitive agreement setting forth the terms and conditions contained in the letter of intent and completion of due diligence. There can be no assurance that the transactions will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the management information circular or filing statement to be prepared in accordance with the Transactions, any information released or received with respect to the transaction may not be accurate or complete and should not be relied upon. Trading in the securities of a capital pool company should be considered highly speculative.

The TSX Venture Exchange has in no way passed upon the merits of the proposed transaction and has not reviewed and does not accept responsibility for the adequacy of the content of this press release.

Shares issued: 7,545,000

Closing price April 26, 2005: $1.22

Contact Information

  • The Endurance Fund Corp.
    Jason C. Monaco
    (416) 742-5600