TORONTO: The Board of Directors of Sentry Select Capital Corp. (“Sentry Select” or the “Manager”) is pleased to announce that at a special meeting held today, the unitholders of Commercial and Industrial Securities Income Trust (the “Terminating Fund”) approved the merger of the Terminating Fund with Sentry Select Canadian Income Fund (“Canadian Income Fund”) (the “Merger”).
The Terminating Fund is a closed-end investment fund listed on the Toronto Stock Exchange (“TSX”) and Canadian Income Fund is an open-end mutual fund. Both funds are managed by Sentry Select.
Completion of the Merger: The effective date of the Merger is expected to be on or about August 20, 2008. The Terminating Fund will transfer all of its assets to Canadian Income Fund in exchange for units of Canadian Income Fund and the assumption by Canadian Income Fund of all the liabilities of the Terminating Fund. Each unitholder of the Terminating Fund will receive units of Canadian Income Fund having the same aggregate net asset value (“NAV”) as their units of the Terminating Fund as of the close of business on the effective date of the Merger.
The proposed Merger is subject to the acceptance and approval by the TSX.
Special distribution: The Merger triggered a tax year-end for the Terminating Fund. An estimated special distribution of $0.43 will be paid to all Terminating Fund unitholders of record as of August 20, 2008. Upon completion of the merger, the final special distribution amount will be announced in a press release and paid by September 15, 2008.
Throughout the year, the Terminating Fund realized capital gains from the sale of securities and must distribute the net income and net realized capital gains to unitholders to ensure that it is not liable for income tax. The special distribution represents the total remaining undistributed net income and net realized capital gains for the year.
The Merger: The Manager believes that the Merger will result in significant benefits to unitholders of the Terminating Fund for the following reasons:
Tax consequences of the Merger: The Manager is proposing that the Merger be effected on a tax-deferred basis.
Costs of the Merger: All costs and expenses associated with the Merger will be borne by the Manager.
Sentry Select Capital Corp.: Sentry Select Capital Corp. is a Canadian wealth management company that manages over $6 billion in assets as of June 30, 2008. The company offers a diverse range of investment products including closed-end trusts, mutual funds, principal-protected notes and flow-through limited partnerships, covering a variety of domestic and global mandates.
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Certain statements included in this news release constitute forward-looking statements, including, but not limited to, those identified by the expressions ‘‘expect’’, ‘‘intend’’, “will” and similar expressions to the extent they relate to Sentry Select. The forward-looking statements are not historical facts but reflect Sentry Select’s current expectations regarding future results or events. These forward-looking statements are subject to a number of risks and uncertainties that could cause actual results or events to differ materially from current expectations. Although Sentry Select believes that the assumptions inherent in the forward-looking statements are reasonable, forward-looking statements are not guarantees of future performance and, accordingly, readers are cautioned not to place undue reliance on such statements due to the inherent uncertainty therein. Sentry Select undertakes no obligation to update publicly or otherwise revise any forward-looking statement or information whether as a result of new information, future events or other such factors which affect this information, except as required by law.
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