Sentry Select Capital Inc. has filed a preliminary prospectus for Sentry Select Canadian Income Exchange Fund, the company said Tuesday.

The Fund is an investment fund established under the laws of the Province of Ontario and is qualified to issue an unlimited number of Class A and Class F units at a price of $10 per unit.

The fund’s investment objectives are: to provide unitholders with distributions equal to 8.5% annually, (approximately 7.1¢ per unit per month) based on the initial price of units; and to provide unitholders with the opportunity for capital appreciation.

A prospective purchaser of units is required to deposit eligible securities with the exchange agent through CDS prior to 17:00 ET on May 14. Such book-entry deposits must be made by a CDS participant.

The fund will seek to achieve its investment objectives by liquidating the eligible securities quickly and efficiently, which may include crossing some securities into the Sentry Select Canadian Income Fund or another mutual fund managed by Sentry Select, and using the proceeds from such dispositions to acquire units of Sentry Select Canadian Income Fund.

For eligible securities other than convertible debentures, the exchange ratios will be determined by dividing the volume weighted average trading price of such securities on the Toronto Stock Exchange during the period of four consecutive trading days ending on May 14, by $10 as adjusted to reflect distributions declared by an exchange issuer that will be payable to the securityholder and therefore will not be received by the fund.

For eligible securities that are convertible debentures, the exchange ratios will be determined by for each $1,000 principal amount of convertible debentures, by dividing the volume weighted average trading price for such principal amount of convertible debentures on the TSX during the pricing period, plus accrued interest, to, but not including, the closing date, by $10.

The exchange ratios will be rounded down to four decimal places. Fractional units will not be issued by the fund.

Prior to the close of business on May 15, the fund will announce the name of the exchange issuer, the weighted average trading price of the eligible securities during the pricing period, and the exchange ratios for the eligible securities of each exchange Issuer.

CIBC World Markets Inc. has been engaged as the agent for the offering.

IE