Wajax Income Fund

Wajax Income Fund

December 15, 2010 09:00 ET

Wajax Announces Special Year End Cash Distribution

MISSISSAUGA, ONTARIO--(Marketwire - Dec. 15, 2010) - Wajax Income Fund (TSX:WJX.UN) today announced a special cash distribution for 2010 of $0.60 per unit. The special cash distribution and the previously declared regular distribution for December of $0.15, together totaling $0.75 per unit, will be paid on January 20, 2011 to unitholders of record on December 31, 2010.

If the actual year-end taxable income of the Fund is greater than the distributions declared for 2010, an additional special non-cash distribution of Fund units will deemed to have been made to unitholders of record on December 31, 2010. As provided in the Fund's Declaration of Trust, if additional Fund units are deemed to have been issued, the outstanding units of the Fund will be immediately consolidated such that the number of units will remain unchanged from the number held prior to the special non-cash distribution.

The Fund is required to provide advance notice to the TSX of any special non-cash distributions. At this time, it is not anticipated that there will be a special non-cash distribution. This estimate is based upon the Fund's current expectations and is subject to change since the Fund's taxable position cannot be known with certainty until year-end results have been finalized on February 25, 2011. This estimate may constitute forward-looking information within the meaning of applicable securities laws.

The News Release announcing year-end results on February 25, 2011 will provide details of any distribution of Fund units which may be deemed to have occurred and of the tax impact on the adjusted cost base of units. It is presently anticipated that all 2010 distributions will be considered other income for tax purposes.

Wajax Corporation Dividends Following Conversion

Following the expected completion of the conversion of the Fund to a corporate entity on January 1, 2011, the Fund's units will be delisted from the TSX and the shares of Wajax Corporation will start trading under the symbol "WJX" at the opening of trading on January 4, 2011.

As previously announced, following conversion, our objective is to pay monthly cash dividends in the same amount paid as a trust in 2010 excluding special distributions. On January 4, 2011, we expect to declare monthly dividends of $0.15 per share ($1.80 annualized) for January and February.

Wajax is a diversified income fund that has three core distribution businesses engaged in the sale and after-sales parts and service support of mobile equipment, industrial components and power systems, through a network of over 110 branches across Canada. Its customer base spans natural resources, construction, transportation, manufacturing, industrial processing and utilities.

This news release contains forward-looking statements. These statements relate to future events or future performance and reflect management's current expectations and assumptions. The words "anticipate", "expect", "believe", "may", "should", "estimate", "project", "outlook", "forecast" or similar words are used to identify such forward-looking information. In particular, but without limitation, this release contains forward-looking statements relating to: the conversion of the Fund to a corporation, the timing of the effective date of the conversion, and the potential for payment of dividends by Wajax Corporation following completion of the conversion. Such forward-looking statements reflect management's current beliefs and are based on information currently available to management of the Fund. In particular, forward-looking statements relating to the potential payment of dividends by Wajax Corporation following completion of the conversion are based on: the financial and operating attributes of the Fund as at the date hereof, the anticipated operating and financial results of the Fund from the date hereof to the effective date, the anticipated operating and financial results of Wajax Corporation after the effective date, the views of management and the board of trustees of the Fund respecting the benefits associated with the conversion, and the views of management and the board of trustees of the Fund regarding current and anticipated market conditions. Although we believe that the expectations represented in such forward-looking statements are reasonable, there is no assurance that such expectations will prove to be correct. By their very nature, forward-looking statements involve inherent risks and uncertainties (both general and specific) and the risk that the expectations represented in such forward-looking statements will not be achieved. Undue reliance should not be placed on forward-looking statements, as a number of important factors could cause the actual events, performance or results to differ materially from the events, performance and results discussed in the forward-looking statements.
These factors include, among other things: changes in laws and regulations affecting the Fund and its business operations, changes in taxation of the Fund, general business conditions and economic conditions in the markets in which the Fund and its customers compete, fluctuations in commodity prices, the Fund's relationship with its suppliers and manufacturers and its access to quality products, the ability of the Fund to maintain and expand its customer base, failure of the parties to the proposed conversion of the Fund to a corporation by way of plan of arrangement to satisfy the conditions thereof, inability to obtain required consents, permits or approvals, actual future market conditions being different than anticipated by management and the board of trustees of the Fund, and actual future operating and financial results of the Fund and/or Wajax Corporation being different than anticipated by management and the board of trustees of the Fund. You are cautioned that the foregoing list is not exhaustive. You are further cautioned that the preparation of financial statements in accordance with GAAP requires management to make certain judgments and estimates that affect the reported amounts of assets, liabilities, revenues and expenses. These estimates may change, having either a negative or positive effect on net earnings as further information becomes available, and as the economic environment changes. Additional information on these and other factors is included in our third quarter MD&A under the heading "Risk and Uncertainties" and in other reports filed by the Fund with Canadian securities regulators and available at www.sedar.com. See also the full details of the conversion included in the Management Proxy Circular for the Fund's unitholder meeting held on May 7, 2010 and which is available at www.sedar.com. The forward-looking statements contained in this news release are expressly qualified in their entirety by this cautionary statement. The forward-looking statements contained herein are made as of the date hereof and neither the Fund nor Wajax Corporation undertakes any obligation to publicly update such forward-looking statements to reflect new information, subsequent events or otherwise unless so required by applicable securities laws.

Contact Information

  • Wajax Income Fund
    Neil Manning
    President and Chief Executive Officer
    (905) 212-3300
    Wajax Income Fund
    John Hamilton
    Chief Financial Officer
    (905) 212-3300