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Financial 15 Split Corp. Exchange Offer Results

TORONTO, April 20, 2018 (GLOBE NEWSWIRE) -- Financial 15 Split Corp. (the “Company”) is pleased to announce it will issue 2,035,942 FTN Class A shares as a result of the offer announced on April 9, 2018 for holders of units of SCITI Trust, whereby one Class A Share of the Company was offered in exchange for 1.17614 freely-tradable listed units of SCITI Trust (the “Exchange Offer”).   The Exchange Offer period has now ended.  The Exchange Offer is expected to close on or about April 24, 2018 and is subject to certain closing conditions including approval by the TSX.

In conjunction with the Exchange Offer, the Company will also issue 2,035,942 FTN.PR.A Preferred Shares of the Company at a price of $9.90 per Preferred Share to yield 5.55%.   The offering was led by National Bank Financial Inc., CIBC Capital Markets and BMO Capital Markets.  The sales period of the Preferred Share offering has now ended. The offering of Preferred Shares is expected to close on or about April 30, 2018. The offering is subject to certain closing conditions including approval by the TSX.

The total value of the Exchange Offer and Preferred Share offering is expected to be approximately $39.1 million including 2,394,550 units of SCITI Trust.

The closing price on the TSX of each of the Preferred Shares and the Class A Shares on April 19, 2018 was $10.06 and $10.28, respectively.  The closing price on the TSX of the SCITI Trust units on April 19, 2018 was $7.76.

The Company will not receive cash proceeds from the issuance of the Class A Shares. In consideration for issuing each Class A Share, the Company will receive 1.17614 units of SCITI Trust. The investment fund manager of SCITI Trust confirmed on March 21, 2018 that SCITI Trust would be terminating on its scheduled termination date of April 30, 2018.  At that time, SCITI Trust will distribute to its unitholders, including the Company, the net asset value of SCITI Trust in cash.

The net proceeds of the offering, consisting of the net cash proceeds from the issuance of the Preferred Shares, and the net cash proceeds received on the wind-up of SCITI Trust in respect of the SCITI Trust units received as consideration for the issuance of the Class A Shares, will be used by the Company to invest in an actively managed, high quality portfolio consisting of 15 financial services companies made up of Canadian and U.S. issuers as follows:

Bank of Montreal National Bank of Canada Bank of America Corp.
The Bank of Nova Scotia Manulife Financial Corporation Citigroup Inc.
Canadian Imperial Bank of Commerce Sun Life Financial Services of Canada Inc. Goldman Sachs Group Inc.
Royal Bank of Canada Great-West Lifeco Inc. JP Morgan Chase & Co.
The Toronto-Dominion Bank CI Financial Corp. Wells Fargo & Co.

The Company’s investment objectives are:

Preferred Shares:

  1. to provide holders of the Preferred Shares with fixed, cumulative preferential monthly cash dividends currently in the amount of 5.50% annually, to be set by the Board of Directors annually subject to a minimum of 5.25% until 2020; and
  2. on or about the termination date, currently December 1, 2020 (subject to further 5 year extensions thereafter), to pay the holders of the Preferred Shares $10.00 per Preferred Share.

Class A Shares:

  1. to provide holders of the Class A Shares with regular monthly cash dividends in an amount to be determined by the Board of the Directors; and
  2. to permit holders to participate in all growth in the net asset value of the Company above $10 per Unit, by paying holders on or about the termination date of December 1, 2020 (subject to further 5 year extensions thereafter) such amounts as remain in the Company after paying $10 per Preferred Share.

A prospectus supplement dated April 9, 2018 to the Company’s short form base shelf prospectus dated November 2, 2017 containing important detailed information about the Preferred Shares and the Class A Shares being offered was filed with securities commissions or similar authorities in all provinces of Canada. Copies of the prospectus supplement and the short form base shelf prospectus may be obtained from your registered financial advisor using the contact information for such advisor, or from representatives of the agents listed above.

Forward-Looking Statements
Certain statements in this news release are forward-looking statements, including those identified by the expressions “anticipate”, “believe”, “plan”, “estimate”, “expect”, “intend” and similar expressions to the extent they relate to the Company or Quadravest.  Forward-looking statements are not historical facts but reflect the current expectations of the Company and Quadravest regarding future results or events.  Such forward-looking statements reflect the Company’s and Quadravest’s current beliefs and are based on information currently available to them.  Forward-looking statements involve significant risks and uncertainties.  A number of factors could cause actual results or events to differ materially from current expectations.  Although the forward-looking statements contained in this news release are based upon assumptions that the Company and Quadravest believe to be reasonable, neither the Company nor Quadravest can assure investors that actual results will be consistent with these forward-looking statements.  Neither the Company nor Quadravest assumes any obligation to update or revise them to reflect new events or circumstances, except as required by law.

For further information, please contact Financial 15 Split Corp. Investor Relations at
416-304-4443 Toll free at 1-877-4-Quadra (1-877-478-2372) or visit www.financial15.com

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