OSP.PR.A Brompton Oil Split Corp

(TSX: OSP, OSP.PR.A) Brompton Funds Limited (“Brompton” or the “Manager”), announces that it will hold a special meeting (the “Meeting”) of holders of Class A Shares and Preferred Shares (the “Shareholders”) of Brompton Oil Split Corp. (the “Fund”). The purpose of the Meeting is to consider and vote upon an extraordinary resolution to implement amendments to update and modernize the investment objectives and investment restrictions of the Fund among other things (the “Amendments”).

The Fund currently invests in a portfolio of equity securities of large capitalization North American oil and gas issuers, primarily focused on those with significant exposure to oil. The Manager believes that the oil and gas industry continues to be an attractive area for investment, however, the number of companies that currently qualify for inclusion in the Fund’s portfolio has decreased by approximately 25% since the Fund’s initial public offering in February 2015 as a result of consolidation within the industry and a decline in the number of oil and gas issuers included in the S&P 500 Index and S&P/TSX Composite Index. Given the changing business and investment environment, oil and gas companies are seeking to diversify their operations over the course of the next decade beyond traditional oil and gas operations which may further limit the investment opportunities that the Fund will have given its current investment restrictions and guidelines.

The Manager proposes to expand the investment universe of the Fund from oil and gas issuers listed in the S&P 500 Index and S&P/TSX Composite Index to a portfolio of equity securities of dividend-paying global energy issuers, which may include companies operating in energy subsectors and related industries such as oil and gas exploration and production, equipment, services, pipelines, transportation, infrastructure, utilities, and renewables, among others. In addition, the Manager proposes that the Fund be permitted to hold up to 25% of its total assets in other global natural resource companies which include companies that own, explore, mine, process or develop natural resource commodities or supply goods and services to those companies.

The Manager believes that the Amendments will enhance the Fund’s long-term returns as well as provide the following benefits:

(a)   Expanded Investment Universe – The Manager estimates that the Fund’s investable universe would increase significantly to approximately three times larger than its current universe.

(b)   Increased Opportunity for Capital Appreciation – An expanded investment universe will provide additional opportunities to increase the value of the Fund’s portfolio which in turn could result in a higher net asset value for the Class A Shares and potentially result in the Fund being able to make monthly cash distributions to the holders of Class A Shares. Holders of Preferred Shares will also benefit from the Amendments if there is an increase in the net asset value of the Class A Shares which will provide greater asset coverage for the Preferred Shares.

(c)   Increased Opportunity for Call Writing – The Fund is permitted to write covered call options on the securities held in its portfolio, accordingly, by expanding the Fund’s investment universe the Manager will have more opportunities to write covered call options and potentially generate additional returns for the Fund.

(d)   Portfolio Diversification – Diversifying the Fund’s portfolio holdings should reduce the volatility of the Fund’s portfolio and mitigate the potential for large declines in the net asset value per Class A Share.

In addition, the management fee payable by the Fund will remain unchanged and will not be increased.

As a result of the changes described above, the Manager is also proposing to change the name of the Fund to “Brompton Energy Split Corp.” and the ticker symbols in respect of the Fund’s Class A Shares and Preferred Shares to ESP and ESP.PR.A, respectively.

A special meeting of Shareholders will be held on December 5, 2023 to consider and vote on the proposed Amendments. Shareholders of record at the close of business on November 3, 2023 will be entitled to vote at the Meeting. If approved, the Manager expects to implement the Amendments as soon as possible following the Meeting. Details of the proposed Amendments will be further outlined in the Fund’s notice of meeting and management information circular that will be prepared and delivered to Shareholders in connection with the Meeting and will be available on www.sedarplus.ca.

About Brompton FundsFounded in 2000, Brompton is an experienced investment fund manager with income focused investment solutions including exchange-traded funds (ETFs) and other TSX traded investment funds. For further information, please contact your investment advisor, call Brompton’s investor relations line at 416-642-6000 (toll-free at 1-866-642-6001), email info@bromptongroup.com or visit our website at www.bromptongroup.com.

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Certain statements contained in this news release constitute forward-looking information within the meaning of Canadian securities laws. Forward-looking information may relate to matters disclosed in this press release and to other matters identified in public filings relating to the Fund, to the future outlook of the Fund and anticipated events or results and may include statements regarding the future financial performance of the Fund. In some cases, forward-looking information can be identified by terms such as “may”, “will”, “should”, “expect”, “plan”, “anticipate”, “believe”, “intend”, “estimate”, “predict”, “potential”, “continue” or other similar expressions concerning matters that are not historical facts. Actual results may vary from such forward-looking information. Investors should not place undue reliance on forward-looking statements. These forward-looking statements are made as of the date hereof and we assume no obligation to update or revise them to reflect new events or circumstances.