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Impact of the Federal Budget on Aston Hill Funds Currently Utilizing Forward Agreements
TORONTO, April 3, 2013 /CNW/ - Federal Budget On March 21, 2013, the Minister of Fi...
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[{"type":"text","content":"\n\n\n\n\n\nTORONTO, April 3, 2013 /CNW/ -\n\n\nFederal Budget\n\n\nOn March 21, 2013, the Minister of Finance announced proposals in a\n Federal Budget that would treat the gain realized by an investment fund\n under a forward purchase or sale agreement (a \"Forward Agreement\") as ordinary income rather than a capital gain if the Forward\n Agreement was entered into or extended on or after March 21, 2013. \n Officials at the Department of Finance subsequently advised that the\n proposals also are intended to apply to any change on or after March\n 21, 2013 to a pre-existing Forward Agreement which increases the market\n exposure under the Forward Agreement (often referred to as an \"upsize\").  Forward Agreements have been used by investment funds to obtain\n exposure to a reference portfolio or asset on a more tax-efficient\n basis than directly holding the reference portfolio or asset.\n\n\nAston Hill Strategic Yield Funds\n\n\nAston Hill Asset Management Inc. (the \"Manager\") is the manager of Aston Hill Strategic Yield Fund and Aston Hill\n Strategic Yield Class (the \"Strategic Yield Funds\").  Aston Hill Strategic Yield Fund currently has in place a Forward\n Agreement which provides exposure to the investment returns of Aston\n Hill Strategic Yield Trust.  Such Forward Agreement was entered into\n prior to the date of the Budget and will end in accordance with its\n terms on December 9, 2014.  Aston Hill Strategic Yield Class currently\n invests substantially all of its assets in units of Aston Hill\n Strategic Yield Fund.  The Manager has determined that the Budget\n proposals will have no impact on the Forward Agreement of Aston Hill\n Strategic Yield Fund and that current investors will continue to\n receive the benefits of the tax efficiencies of the Strategic Yield\n Funds until the Forward Agreement expires.  Based on available\n information, as the Budget proposals will not permit this Forward\n Agreement to be upsized, the Manager has determined that it would be in\n the best interests of existing investors to immediately cease accepting\n orders for the purchase of new units or shares of the Strategic Yield\n Funds until further notice.  This includes purchases under\n pre-authorized purchase plans.  Automatic reinvestments of dividends\n and distributions by the St...