Income & Equity Index Participation Fund
TSX : IEP.UN

Income & Equity Index Participation Fund

November 19, 2008 18:36 ET

Income & Equity Index Participation Fund Announces Special Meeting of Unitholders and Proposes Alternative to Termination

CALGARY, ALBERTA--(Marketwire - Nov. 19, 2008) - Income & Equity Index Participation Fund (TSX:IEP.UN) (the "Fund") wishes to advise that it has entered into an arrangement agreement (the "Arrangement Agreement") with CGF Mutual Funds Corporation ("CGF MFC") which provides for the merger of the Fund with CGF MFC, resulting in the exchange of all of the issued and outstanding trust units ("Units") of the Fund for CGF Income & Equity Class Shares ("I&E Shares", a separate mutual fund investment portfolio of CGF MFC). Pursuant to the Arrangement Agreement, holders ("Unitholders") of Units will receive, for each Unit held, one I&E Share pursuant to a plan of arrangement under the Business Corporations Act (Alberta) (the "Arrangement") involving the Fund, CGF MFC, Equity LIFT Management Ltd. (the "Administrator"), CGF MFC Management Ltd. and the Unitholders.

A special meeting of the Unitholders ("Meeting") of the Fund will be held at the Columbia Boardroom, Stikeman Elliott LLP, 4300 Bankers Hall West, 888 - 3rd Street S.W., Calgary, Alberta at 10:00 a.m. (Calgary time) on February 12, 2009 to consider and, if thought fit, pass an extraordinary resolution (the "Arrangement Resolution") authorizing and approving the Arrangement, all as more particularly set out in a Management Information Circular of the Fund (the "Circular") to be sent to Unitholders of record as of December 15, 2008 (the "Record Date"). The Circular explaining the Arrangement, along with a voting instruction form, is anticipated to be mailed to Unitholders in late December 2008.

The Arrangement is subject to court and regulatory approval and other conditions that are typical of transactions of this nature, including the approval of the Arrangement Resolution by the holders of at least 75% of the Units represented in person or by proxy at the Meeting. Only Unitholders of record on the Record Date will be entitled to vote on the foregoing proposed Arrangement Resolution at the Meeting.

If all necessary approvals are obtained and all other conditions are either satisfied or waived with respect to the Arrangement, the Administrator anticipates that the effective date will occur on or before June 30, 2009 (the "Effective Date"). On or about the Effective Date, the Units of the Fund will be delisted from the Toronto Stock Exchange.

Background

The Administrator is obligated pursuant to the administrative services agreement governing the administration of the Fund to present a proposal to Unitholders providing for an alternative to the termination of the Fund.

After careful consideration and a review of a variety of alternatives to termination, the board of directors of the Administrator concluded that the Arrangement represented the preferred alternative. The Independent Review Committee of the Fund also reviewed and examined the Arrangement and the impact thereof on Unitholders and concluded that the Arrangement achieves a fair and reasonable result for the Fund.

CGF Mutual Funds Corporation and CGF Income & Equity Fund

CGF MFC has 10 classes of mutual fund shares, each of which is a separate mutual fund investment portfolio of CGF MFC. Each class of mutual fund shares of CGF MFC has its own investment mandate and allows investors to switch to other mutual funds represented by other classes of shares of CGF MFC (each a "Mutual Fund") on a tax-deferred basis. A Unitholder that acquires I&E Shares as a result of the Arrangement may, if the Unitholder determines to do so having regard to such Unitholder's own investment objectives, switch some or all of the I&E Shares for other Mutual Funds, without creating a tax liability for the Unitholder on the switch.

The following is a collection of summary information pertaining to the I&E Shares and is qualified in its entirety by the more comprehensive disclosure contained in the preliminary simplified prospectus and preliminary annual information form of CGF Income & Equity Fund filed on SEDAR.

Investment Objective

CGF Income & Equity Fund's objective is to provide a stable level of monthly cash distributions in an amount determined and announced from time to time by CGF Income & Equity Fund having regard to CGF Income & Equity Fund's then current portfolio and the prevailing economic and market condition and to provide the opportunity to participate in gains in the Canadian equity market.

Investment Strategy

In pursuit of CGF Income & Equity Fund's investment objective, under normal market conditions, CGF Income & Equity Fund will invest its assets in a diversified portfolio comprised of fixed income investments, which may include income funds as well as preferred shares and large cap domestic and international equity securities in a ratio sufficient to satisfy the monthly income requirements as well as provide a measure of growth to the overall portfolio. The Fund may purchase options on equities in order to obtain or maintain the target asset exposure to equities. CGF Income & Equity Fund may also invest up to 30% of its assets in foreign securities.

The Investment Manager

Shaunessy Investment Counsel Inc. is the investment manager to CGF Income & Equity Fund.

Redemption of I&E Shares

I&E Shares are fully redeemable on a daily basis at the net asset value per share.

Switches

A shareholder can switch from one Mutual Fund to another by transferring its investment money from one Mutual Fund to another Mutual Fund within the CGF Group of Funds™. A shareholder must maintain a minimum account balance per Mutual Fund, and a shareholder must switch a minimum dollar amount per Mutual Fund worth of securities.

A preliminary simplified prospectus relating to the fund has been filed with certain Canadian securities commissions or similar authorities. You cannot buy mutual fund shares of the fund until the relevant securities commissions or similar authorities issue receipts for the simplified prospectus of the fund.

Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments. Please read the prospectus before investing. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated.

Contact Information

  • Income & Equity Index Participation Fund
    Joe MacDonald
    Executive Vice President, Sales and Marketing
    1-877-261-9674
    or
    Income & Equity Index Participation Fund
    Andrea Kladar
    Vice President, Sales and Marketing Western Region
    1-866-936-7880
    Website: www.citadelfunds.com