Scotia Managed Companies

R Split II Corp. was created to invest its funds in Royal Bank of Canada common shares in order to generate fixed cumulative distributions for holders of its Preferred Shares and to enable the holders of the Company's Capital Shares to participate in any capital appreciation in the portfolio shares. On May 29, 2009, the Capital Shares and Preferred Shares were redeemed by the Company in accordance with the redemption provisions as detailed in the prospectus dated April 28, 2004.

Distribution Policy

For historical distribution amounts, please see distribution information.

Redemption

All Capital Shares and Preferred Shares were redeemed on May 29, 2009.

Preferred Shares were redeemed at $30.50 per share.

Capital Shares:
1. Capital Shares were redeemed at $28.6859 per share; or
2. Holders of 286,650 Capital Shares requested delivery of their pro rata share of the portfolio securities in payment for their Capital Shares.

Taxation

Dividends other than the capital gains dividends received by individuals on the Preferred or Capital Shares will be subject to the normal gross-up and dividend tax credit rules applicable to dividends received on shares of a taxable Canadian corporation.

The amount of any capital gains dividend received by a holder of Preferred or Capital Shares will be considered to be a capital gain of the holder in the taxation year in which the capital gains dividend is received.

Return of capital payments to a holder of Preferred Shares will not be subject to tax but will reduce the adjusted cost base of the Preferred Shares to the holder.

The Company qualifies as a "mutual fund corporation" and a "financial intermediary corporation" as defined in the Income Tax Act (Canada). As a result thereof and after deduction of expenses in computing its income, the Company does not anticipate that it will be subject to any material net non-refundable tax liability.