Marret Asset Management Inc.

Marret Asset Management Inc.
Marret Investment Grade Bond Fund

Marret Investment Grade Bond Fund

October 02, 2014 13:44 ET

Unitholders Approve Extension of Marret Investment Grade Bond Fund

TORONTO, ONTARIO--(Marketwired - Oct. 2, 2014) -

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Marret Asset Management Inc. announced that at a special meeting held today, unitholders of Marret Investment Grade Bond Fund (the "Fund") approved the extension of the term of the Fund by five years to October 31, 2019 (the "Continuation").

The Continuation will involve:

  1. Amendments to the investment objectives, investment strategies and investment restrictions of the Fund to reflect generally the current investment objectives, investment strategies and investment restrictions of the underlying investment fund (the "Portfolio Trust");
  2. An amendment to the management fee provision in the management agreement between Marret, manager of the Fund, and the Fund in order to reflect the current aggregate management fee paid by the Fund and the Portfolio Trust;
  3. Setting the annual redemption rights on the last business day of May of each year, beginning with May 31, 2016, in connection with the Continuation and extend the monthly redemption privileges set out in the Declaration of Trust of the Fund; and
  4. Amendments to the Declaration of Trust to remove references to the character conversion structure of the Fund and to give effect to the changes listed above.

In connection with the Continuation, Marret created a special redemption right to provide unitholders who did not wish to extend their investment with the option of redeeming their units on October 31, 2014. Unitholders were required to give notice of a redemption on or prior to 5:00 p.m. Eastern time on October 1, 2014. The Continuation was conditional upon the net asset value of the Fund being $50 million or more after giving effect to the redemption right, and this condition has been satisfied.

As a result of federal income tax changes in March 2013, the forward agreement through which the Fund receives exposure to the portfolio of assets held by the Portfolio Trust cannot be extended past its termination date of October 31, 2014 and the investment structure of the Fund must be modified to reflect direct investments in assets comprising the portfolio after that date.

On or about October 31, 2014, the Fund will dispose of all of its assets that are subject to the forward agreement. This will trigger a realization of all accrued capital gains and losses in the Fund. The Fund is expected to realize net capital gains as a result of such dispositions and therefore may be required to make a special distribution to unitholders of record on October 31, 2014 on or about November 14, 2014.

As a result of the Continuation, investors who continue to hold Fund units will continue to receive monthly distributions and have the potential to benefit from any capital appreciation of the Fund's investment portfolio.

About Marret

Marret Asset Management Inc. specializes in fixed income and particularly in high-yield debt strategies. The experienced team of investment professionals is led by Barry Allan, President and Chief Investment Officer. He founded Marret in 2000, following a career at Altamira, Nesbitt Thomson and a Canadian chartered bank, and has over 30 years of experience in credit and fixed-income markets.

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