Front Street Energy Growth Fund Inc.

Front Street Energy Growth Fund Inc.

July 28, 2014 16:22 ET

Front Street Energy Growth Fund Inc. Labour Sponsored Fund-Resumption of Redemptions

TORONTO, ONTARIO--(Marketwired - July 28, 2014) -


Front Street Energy Growth Fund Inc. (the "Fund") and its manager, Front Street Capital 2004 (the "Manager"), are pleased to announce that the remaining portfolio assets of the Fund have been liquidated and that the Fund's board of directors has approved the reopening of the Fund for redemptions. Accordingly, shareholders of the Fund will be able to redeem their shares starting Friday, August 1, 2014. The Fund will hold an annual and special meeting of shareholders on September 30, 2014 (the "Meeting"), during which the shareholders will be asked to vote on a resolution to approve the wind-up and dissolution of the Fund.

Once the wind-up and dissolution of the Fund are approved by shareholders, the Fund intends to redeem all shares then outstanding in the wind-up. Management must ensure that the Fund retains appropriate reserves to cover estimated expenses and liabilities up to and including the wind-up and corporate dissolution. When the Fund is re-opened for redemptions, these reserves will be included in the calculation of the net asset value of each Series of shares, which may fluctuate as such reserves will be adjusted as and when necessary, leading up to the dissolution. Due to these fluctuating reserves, a shareholder who redeems earlier may receive redemption proceeds at a net asset value that varies from the net asset value received by a shareholder who redeems later in the period leading up to, or on, the dissolution of the Fund.

Shareholders who have held their shares for less than eight (8) years and who redeem their shares prior to the meeting on September 30, 2014 will be subject to a special tax pursuant to section 211.8(1) of the federal Income Tax Act equal to the amount of the labour sponsored venture capital corporation tax credit previously received. This tax or clawback of the tax credit will not apply to shareholders who have held their shares for at least eight (8) years, and should not apply to any shareholder who redeems their shares after the shareholder vote and once the Fund begins to wind-up, resulting in the Fund discontinuing its venture capital business.

The Manager would like to thank shareholders for their patience in this wind-up process. Shareholders of record on August 27, 2014 will be entitled to receive notice of and vote at the September 30, 2014 meeting. A management information circular with further information containing details of the business to be considered at the meeting will be mailed to shareholders in early September.

Front Street Capital has been providing Canadians with innovative mutual funds for over 10 years, including growth, income and tax-minded portfolios offered as mutual funds, hedge funds, flow-through limited partnerships and trusts. Front Street Capital is focused on giving Canadian investors and advisors access to a broad range of investments which can fill core and strategic roles in an investor's portfolio.

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