Echelon Financial Holdings Inc. Provides Update on Sale of Echelon Insurance to CAA Club Group and Proposed Special Distribution Payment

TORONTO, May 30, 2019

"We are excited to welcome Echelon Insurance to the CAA Club Group of Companies," said
Jay Woo, President and CEO of CAA Club Group. "We look forward to the continued growth of Echelon Insurance, leveraging its expertise and market leadership in specialty and commercial insurance.  We will expand and deepen our relationships with Brokers across Canada to continually enhance insurance products and services to protect Canadians from coast-to-coast."

The Transaction is scheduled to be completed on or about May 31, 2019. The net proceeds to EFH (after adjustments and expenses) is expected to be approximately C$166 million, which includes C$12 million that will be placed in escrow while EFH and CAA Club Group review and confirm the calculation of regulatory MCT at closing (which EFH has committed will be at least 220%) (the "Escrowed Proceeds").

Conditional upon the closing of the Transaction as scheduled, the board of EFH has declared a special distribution in the amount of $8.80 (the "Special Distribution Payment") per outstanding common share of EFH (the "Common Shares"). The record date for shareholders entitled to receive the Special Distribution Payment will be June 11, 2019 and the payment date will be June 17, 2019 (the "Payment Date"). Approximately $5.80 of the Special Distribution Payment will be paid to shareholders as a return of capital, with the balance of $3.00 paid to shareholders as an eligible dividend.

The Toronto Stock Exchange (the "TSX") has advised EFH that "Due Bills" are to be used in connection with the trading of the Common Shares through the facilities of the TSX for the period from and including June 10, 2019 until the close of trading on June 17, 2019 (the "Due Bill Period"). A Due Bill is defined in the TSX Company Manual as an instrument used to evidence the transfer of title to any dividend, distribution, interest, security or right to a listed security contracted for, or evidencing, the obligation of a seller to deliver such dividend, distribution, interest, security or right to a subsequent purchaser.

As a result, buyers of Common Shares during the Due Bill Period will receive the Special Distribution Payment, provided they continue to be holders of the applicable Common Share on the Payment Date.

The Common Shares will commence trading on an ex-distribution basis (i.e., without an attached Due Bill entitlement to the Special Distribution Payment) commencing at the opening of trading on June 18, 2019. The Due Bill redemption date will be June 19, 2019 ("Due Bill Redemption Date").