Middlefield today released further specifics of the merger, announced July 30, of Yieldplus Income Fund, Core IncomePlus Fund, Maxin Income Fund, Pathfinder Income Fund, and MG Dividend & Income Fund, with Yieldplus being the continuing fund.

All five funds are co-advised by Guardian Capital LP and Middlefield Capital Corp. and have similar objectives.

The purpose of the merger is to provide unitholders of all funds with the opportunity to hold units of a fund that offers a larger market capitalization, increased trading liquidity and lower operating costs on a per unit basis.

Completion of the merger is expected to take place on September 27, and is subject to all regulatory requirements and customary closing conditions being satisfied.

The merger will be effected on a tax-deferred “rollover” basis at an exchange ratio calculated as the net asset value per unit of each fund divided by the net asset value per unit of the continuing fund, each determined as at the close of trading on the TSX on the business day immediately prior to September 27.

Following the completion of the merger, Yieldplus will increase its monthly distribution rate from 8¢ per unit to 10¢ per unit. The first monthly distribution of 10¢ per unit will be payable on October 15 to unitholders of record on September 30. The new distribution amount equates to an annual rate of $1.20 per unit, which is the continuing fund’s target distribution rate for the following 12 months. Based upon current exchange ratios, it is anticipated that unitholders of terminating funds will receive distributions substantially equal to, and in most cases greater than, the distributions that they currently receive.

Unitholders of the funds who do not wish to participate in the merger and become unitholders of the continuing fund will have the opportunity to redeem their units of the respective funds before the merger occurs. In order to provide unitholders of all of the funds with an equal opportunity to choose not to participate in the merger, the annual redemption dates for each of Core, Maxin and Pathfinder have been moved up from November 30 to August 31, which is the annual redemption date for Yieldplus and MG. As a result, all funds will have a common annual redemption date that precedes September 27.

Additionally, to provide unitholders of Core, Maxin and Pathfinder with sufficient time to participate in the annual redemption, the manager of these funds has shortened the required notice period prior to which unitholders of these funds must surrender their units to five business days before August 31, being August 24. Surrendered units will be redeemed at a price calculated with reference to the net asset value per unit in accordance with the respective fund’s declaration of trust.

Yieldplus trades under the symbol YP.UN on the Toronto Stock Exchange.