New investment offerings for Clarica clients

WATERLOO, ON, May 22, 2002 – Clarica Life Insurance (CLI: TSX) announced today that it has entered into a definitive agreement to sell all of the outstanding shares of its mutual fund subsidiary, Clarica Diversico Ltd. to CI Fund Management Inc., Toronto.

At the same time, Sun Life Financial Services of Canada Inc, (SLC: NYSE/TSX) announced the sale of its subsidiary Spectrum Investment Management Ltd, manager of the Spectrum Funds, to CI. In addition, both Clarica and Sun Life Financial will be transferring the management and administration of their retail segregated funds to CI. The transactions also include a strategic distribution agreement giving preferred access to CI products to more than 4,000 Clarica agents/managers.

Under the terms of the agreements, Clarica and Sun Life will jointly obtain a 30 per cent interest in CI Fund Management, becoming its largest shareholder, and holding two seats on the eight-member board of directors of CI. CI Fund Management Inc. (CIX: TSX) is an independent, Canadian-owned investment management company. With approximately $32.5 billion in long-term assets under management, C.I. will have the capacity to grow based on an enhanced distribution platform.

The transaction is subject to the closing of Sun Life Financial’s acquisition of Clarica, which still requires the approval of the Minister of Finance. The sale of Clarica Diversico, which is subject to regulatory approval, is expected to close in July.

Barry Triller, Executive Vice-President, Canadian Customers, Clarica, said that the deal provides Clarica’s and Sun Life Financial’s more than 4,000 independent career advisors and managers with access to CI’s family of mutual funds as well as the 42 funds they currently offer clients. “This is an important new opportunity for our advisors. We have the largest face-to-face distribution channel in Canada and now our advisors will have access to significant product offerings from a market leader in the mutual fund industry. This is a unique opportunity to serve clients better.”

CI will assume responsibility for administration, marketing, product development and pricing of all retail mutual funds and retail segregated funds. In Canada, Clarica will focus on being a leading distributor of retail wealth management products. Sun Life Financial and Clarica will continue to be the insurer for the segregated fund guarantees of their in-force business, while CI will assume fund management.

Triller said the deal gives Clarica and Sun Life Financial a strong ownership position in CI, which means a richer and deeper relationship with a top-tier player in the retail wealth arena. “As well, for Clarica advisors and their clients, this new partnership with CI brings a wider range of high- quality funds and fund managers — an important asset for our customers in this very competitive market.” The transaction will not result in any immediate changes to a client’s investments. As the operations are integrated any changes will be carefully considered and clients will be informed of changes that will impact them.

Each of the Clarica funds has individual trustees, who will resign on closing and be replaced by the Board of Governors of CI, a majority of whom are independent of CI. This transaction is expected to result in the elimination of approximately 100 positions at Clarica by the end of this year.

CI does not plan to increase its management fees or operating expenses. It will look for synergies between the two companies and their fund families with the expectation that it can reduce either management fees or the relative levels of their operating expenses, or both, providing a benefit to unitholders.

Clarica has provided insurance and investment solutions to Canadians for more than 130 years. As well as individual and group insurance, Clarica provides a full range of wealth management products. In Canada, Clarica serves nearly 4 million customers through 8,000 staff, agents, financial planners and group representatives who operate out of 90 offices throughout Canada.

Sun Life Financial to acquire economic interest in C.I. Fund Management valued at $860 million in exchange for mutual fund subsidiaries

TORONTO, May 22, 2002 – Sun Life Financial Services of Canada Inc.(NYSE/TSX: “SLC”) today announced a definitive agreement to acquire a 30 per cent economic interest in C.I. Fund Management Inc. (“CI”; TSX: “CIX”) in exchange for its subsidiary company, Spectrum Investment Management Limited(“Spectrum”) and Clarica Diversico Ltd. (“Diversico”), the mutual fundsubsidiary of Clarica Life Insurance Company (TSX: “CLI”). The transactionalso includes a strategic distribution agreement giving CI preferred accessfor its products to more than 4,000 Clarica agents and managers.

Sun Life Financial will receive the equivalent of approximately 74 million common shares of CI, which will represent 30 per cent of CI after the transaction is completed. A 20 per cent interest will be issued on closing, and the remainder will be in the form of non-voting preferred shares convertible into CI common shares. The conversion of the preferred shares will be subject to the approval of CI shareholders. Certain management shareholders have agreed to support the transaction and to vote their shares in favour of the conversion.

The transaction also includes a standstill agreement under which Sun Life Financial has agreed not to increase its stake in CI beyond 34 per cent for three years, subject to certain exceptions. Sun Life Financial will enter into a shareholders agreement with certain CI management shareholders, which, among other things, will provide Sun Life Financial with representation on CI’s board of directors.

“This transaction moves us closer to our strategic objective of achieving leadership positions in key target markets in North America. We will hold a significant ownership stake in what will become the fourth largest mutual fund manufacturer in Canada by long-term assets under management, accessing both the requisite scale and shelf space in a competitive industry,” said Donald A. Stewart, Chairman and Chief Executive Officer, Sun Life Financial. “This transaction also enhances our distribution strategy by offering clients, through Canada’s largest direct sales force, greater choice and improved performance at highly-competitive prices.”

The transaction, which is subject to regulatory approval, is expected to close in July, following the required notification to unitholders of the Spectrum and Clarica funds. The transaction is also subject to the closing of Sun Life Financial’s acquisition of Clarica, which still requires the approval of the Minister of Finance.

In Canada, Sun Life Financial will focus on being a leading distributor of retail wealth management products through Clarica’s sales force. Sun Life Financial and Clarica will continue to be the insurer for the retail segregated fund guarantees of the in-force business, while CI will assume responsibilities for the administration of the retail segregated funds. McLean Budden and MFS Investment Management Inc. will continue to provide fund management services to Spectrum, Diversico and CI.

“The transaction offers an opportunity to create a national leader in a highly-competitive marketplace,” said Paul Derksen, Executive Vice President and Chief Financial Officer, Sun Life Financial. “It combines the distribution power and expertise of Clarica’s retail sales force with the breadth of product offerings of CI, Spectrum and Diversico.”

With approximately CDN $32.5 billion in long-term assets under management, CI will have the capacity to grow based on an enhanced distribution platform, and as the preferred supplier of mutual funds and segregated funds to Clarica’s sales force.

It is anticipated that approximately 220 positions will be affected due to the sale of the combined mutual fund operations to CI. However, it is expected that the number of employees impacted will be less than the actual number of positions eliminated due to attrition and growth at CI.

C.I. Fund Management Inc.

C.I. Fund Management Inc. is an independent, Canadian-owned investment management company with $26.5 billion in fee-earning assets as of May 17, 2002. It has one of the industry’s broadest selections of investment funds, including mutual funds, industry-specific funds, 100% RSP-eligible global funds, multi-manager funds, segregated funds and hedge funds. It offers top- ranked investment expertise through nine portfolio management teams.

Clarica

Sun Life Financial

Sun Life Financial is a leading international financial services organization providing a diverse range of wealth accumulation and protection products and services to individuals and corporate customers. Tracing its roots back to 1871, Sun Life Financial and its partners today have operations in key markets worldwide, including Canada, the United States, the United Kingdom, Hong Kong, the Philippines, Japan, Indonesia, India, China and Bermuda. As of March 31, 2002 the Sun Life Financial group of companies has total assets under management of CDN $357 billion.

Sun Life Financial Services of Canada Inc. trades on the Toronto (TSX), New York (NYSE) and Philippine (PSE) stock exchanges under ticker symbol “SLC”.

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