Crosswinds Announces Agreement to Sell Monarch

11/28/2017

TORONTO, Nov. 28, 2017 (GLOBE NEWSWIRE) -- Crosswinds Holdings Inc. (“Crosswinds” or the “Company” (TSX:CWI) today announced that its majority owned subsidiary, Crosswinds Investor Monarch LP (“CIML”), has entered into an agreement (the “Agreement”) to sell all of its interests in Monarch Delaware Holdings LLC (“Monarch”) to its joint venture partner, Federated National Holding Company (“Federated National” or the “Purchaser”) for an aggregate purchase price of USD$12,282,000 payable to CIML, with Crosswinds, in its capacity as a limited partner of CIML, receiving approximately USD$10,525,764 of those proceeds (the “Proposed Transaction”).

As part of the Proposed Transaction, Crosswinds Re will be granted a right of first refusal (“ROFR”) to write up to USD$10,000,000 of limit on reinsurance business with Federated National, at market terms and rates, during 2018.  In addition, Crosswinds or an affiliate of Crosswinds, will receive a one year advisory engagement permitting it to earn USD$300,000 in fees.  The existing investment management agreement with Crosswinds’ subsidiary, Crosswinds AUM LLC would terminate on closing of the Proposed Transaction.

The Proposed Transaction remains subject to certain conditions, including without limitation, the Purchaser obtaining the required financing to purchase Crosswinds’ interests in Monarch (together with the interests of Transatlantic Reinsurance Company, a minority investor in and lender to Monarch), receipt of regulatory approval from the Florida Office of Insurance Regulation, completion of certain transaction documents and other customary closing conditions for a transaction of this nature.  

Subject to completion of the Purchaser’s financing and receipt of regulatory approval, it is expected that the Proposed Transaction will close in the first quarter of 2018.  There can be no assurance that the conditions will be completed or that the Proposed Transaction will close.  Crosswinds has granted exclusivity to Federated National from the date of the Agreement to the earlier of closing or termination of the Proposed Transaction, subject to certain terms and conditions.

A copy of the Agreement will be available under the Company’s profile at www.sedar.com and the summary herein is qualified in its entirety by reference to that Agreement.

Crosswinds Holdings Inc. 
Crosswinds is a publicly traded private equity firm and asset manager targeting strategic and opportunistic investments in the financial services sector with a particular focus on the insurance industry.

More information
Colin King 
Tel:  1-800-439-5136 
info@crosswindsinc.com  
www.crosswindsinc.com

Caution Regarding Forward-Looking Information
This release includes certain forward-looking statements. Forward-looking statements generally can be identified by the use of forward-looking terminology such as “may”, “will”, “expect”, “intend”, “estimate”, “anticipate”, “believe”, “should”, “plans” or “continue” or the negative thereof or variations thereon or similar terminology. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, it can give no assurance that such expectations will prove to be correct.  These forward-looking statements are subject to a number of risks and uncertainties. Actual results could differ materially from those anticipated in these forward-looking statements. Reference should be made to the risk factors in the Company’s 2016 Annual Information Form, in the Management’s Discussion and Analysis for the year ended December 31, 2016 and in our other filings with Canadian securities regulators. Additional important factors that could cause actual results to differ materially from expectations include, among other things, the Purchaser not completing the contemplated financing, regulatory approval not being granted, general economic and market factors.

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Source: Crosswinds Holdings Inc.

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