TSX Symbol: CXC, CXC.PR.A
TORONTO, Nov. 18 /CNW/ - CIX Split Corp. (the "Corporation") announced today that it will seek the approval of its shareholders to change the investment objectives, strategies and restrictions of the Corporation (the "Mandate Change") to reflect that the Corporation will invest substantially all of its assets in common shares of the corporate successor ("CI Financial") to CI Financial Income Fund (the "Income Fund") if the Income Fund is successful in converting to a corporation. On October 15, 2008, the Income Fund announced its intention to convert its structure from an income trust to a corporation at the end of 2008, subject to receipt of all necessary unitholder, court and other approvals.
Currently, the Corporation has invested part of its assets in trust units of the Income Fund and the balance of its assets in a portfolio of common shares of Canadian public companies which, under a forward purchase and sale agreement, the Corporation has agreed to sell to a counterparty for a purchase price calculated by reference to the market value of a reference number of trust units of the Income Fund. As part of the Mandate Change, the Corporation also will complete the early settlement of the sale of its common share portfolio to the counterparty. The Corporation will invest the proceeds from such sale in common shares of CI Financial.
The Mandate Change also will include deleting from the Corporation's investment objectives respecting its Class A Shares the reference to targeted monthly cash distributions. The Corporation is precluded by the terms of the Class A Shares from paying distributions thereon when the net asset value per unit (one Class A Share and one Priority Equity Share, together) is equal to or less than $15.00. Due to prevailing market conditions, it is no longer realistic for the Corporation to pursue an objective of targeted monthly cash distributions on the Class A Shares.
If the Mandate Change is not approved, the Corporation also will seek the approval of its shareholders to terminate the Corporation on or about December 31, 2008 since the Corporation will be unable to comply with its current investment objectives, strategies and restrictions after the Income Fund completes its reorganization into CI Financial.
A meeting of the shareholders of the Corporation will be held on or about December 23, 2008 to approve either the Mandate Change or the early termination of the Corporation. Shareholders of record at the close of business on November 22, 2008 will be entitled to receive notice of the meeting. If the Mandate Change is approved and implemented, shareholders who do not wish to continue holding their shares of the Corporation may either dispose of their shares or exercise one of the retraction rights attached to their shares. Shareholders will not have a right under corporate laws to dissent from the Mandate Change.
The Corporation's Class A Shares and Priority Equity Shares are listed on the Toronto Stock Exchange under the symbols CXC and CXC.PR.A, respectively.