Newport Partners Income Fund
TSX : NPF.UN
TSX : NPF.DB
TSX : NPF.DB.A

Newport Partners Income Fund

March 01, 2011 16:37 ET

Newport Partners Income Fund Files Circular for Special Meeting of Unitholders to Approve Conversion to a Corporation

The Board of Trustees has Unanimously Recommended That Unitholders Vote FOR the Conversion to a Corporation

TORONTO, ONTARIO--(Marketwire - March 1, 2011) -

NOT FOR DISTRIBUTION TO THE U.S. NEWS WIRE SERVICES OR FOR DISSEMINATION IN THE UNITED STATES

Newport Partners Income Fund (TSX:NPF.UN)(TSX:NPF.DB)(TSX:NPF.DB.A) is pleased to announce that it has today filed a management information circular for the special meeting of unitholders of the Fund to be held at 8:30 am (Toronto time) on March 25, 2011 at the offices of Ogilvy Renault LLP Suite 3800, Royal Bank Plaza, South Tower, 200 Bay Street, Toronto, Ontario, to approve the conversion of the Fund to a corporation.

Under a proposed plan of arrangement pursuant to the Ontario Business Corporations Act, unitholders of the Fund will exchange units of the Fund for commons shares of a new corporation, to be called Newport Inc., on a one-for-one basis. Unitholders will continue to own the same proportionate economic interest in Newport's business following the exchange. No tax will be payable by the Fund in connection with the conversion and a tax deferred "rollover" for Canadian federal income tax purposes will be available for the exchange of units for common shares of Newport Inc.

The trustees of the Fund, after assessing the Fund's current trust structure and financial position have concluded that the trust structure is no longer effective for the maximization of unitholder value, and have determined that unitholders of the Fund would benefit from conversion of the Fund to a corporate structure. The Board of Trustees of the Fund has concluded that the conversion is fair to unitholders and in the best interests of the Fund and its unitholders. If approved, the conversion is expected to be completed on April 1, 2011.

On February 22, 2011, the Ontario Superior Court issued an interim order for the Fund to proceed with the special meeting of unitholders. In addition, the Toronto Stock Exchange conditionally approved the listing of the common shares to be issued by Newport Inc. in exchange for the units of the Fund under the conversion, subject to satisfaction of the requirements of the exchange.

In addition to the proposed conversion, unitholders will also be asked at the March 25, 2011 special meeting to approve a new management incentive plan to recognize certain members of Newport's management for their efforts in connection with the proposed debt restructuring of the Fund first announced on November 30, 2010. The meeting of holders of debentures of the Fund to consider and vote on the proposed debt restructuring will be held on March 18, 2011.

The management information circular for the Meeting which provides details of the proposed conversion and the management incentive plan, is expected to be mailed on March 4, 2011 and will be available at www.sedar.com.

About Newport Partners Income Fund

Newport Partners Income Fund is an unincorporated open-ended trust created to hold, through its investment in Newport Partners Commercial Trust, interests in Newport Private Yield LP, a limited partnership established under the laws of the Province of Ontario. Securities of Newport Partners Income Fund began trading on the TSX on August 8, 2005 under the symbol NPF.UN.

Newport Partners Income Fund is a publicly-traded diversified fund that invests in successful Canadian private businesses. The Fund, currently has $443 million invested in 12 companies representing a diverse cross-section of the Canadian economy. 

Forward-Looking Statements

Certain information included in this news release may constitute forward-looking information within the meaning of securities laws. In some cases, forward-looking information can be identified by terminology such as "may", "will", "should", "expect", "plan", "anticipate", "believe", "estimate", "predict", "potential", "continue" or the negative of these terms or other similar expressions concerning matters that are not historical facts. Without limitation, information regarding the closing of the transaction constitutes forward-looking information. Such forward-looking information reflects management's current beliefs and is based on information currently available to management of the Fund and the businesses in which the Fund holds an ownership interest (the "Operating Partnerships"). Forward-looking information involves significant risks and uncertainties. A number of factors could cause actual events or results to differ materially from the events and results discussed in the forward-looking information, including risks related to the satisfaction of all closing conditions to the Refinancing and Exchange Transaction, the receipt of all required consents and approvals and the abilities, actions, financial condition and circumstances of other parties to the Refinancing and Exchange Transaction,. These factors should not be considered exhaustive. In addition, in evaluating this information, investors should specifically consider various factors, including the risks outlined in the Fund's public disclosure documents filed on SEDAR at www.sedar.com, which may cause actual events or results to differ materially from any forward-looking statement. In formulating forward-looking information herein, management has assumed that business and economic conditions affecting the Fund and its operating partnerships and the other parties to the exchange transaction will continue substantially in the ordinary course, including without limitation, with respect to general levels of economic activity. Although the forward-looking information is based on what management of the Fund and the Operating Partnerships consider to be reasonable assumptions based on information currently available to it, there can be no assurance that actual events or results will be consistent with this forward-looking information, and management's assumptions may prove to be incorrect. This forward-looking information is made as of the date of this news release, and the Fund does not assume any obligation to update or revise them to reflect new events or circumstances. Undue reliance should not be placed on forward-looking information. The Fund is providing the forward-looking financial information for the purpose of providing investors with some context for the information presented herein. Readers are cautioned that this information may not be appropriate for any other purpose.

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