TORONTO, May 24, 2012 /CNW/ - GCIC Ltd. ("GCICL"), the manager of the Dynamic Funds and Marquis Investment Program (collectively, the "Funds"), today announced proposals to change its method of charging operating expenses to the Funds to increase fee predictability and transparency, and certain other changes, described below. A special meeting of securityholders (the "Special Meeting") will be held on or about August 21, 2012 to consider the proposed changes.
In addition, effective today, the management fee charged to Series A and Series T shares of Dynamic Power Global Navigator Class will be reduced from 2.25% to 2.00% and the management fee charged to Series F Shares of that Fund will be reduced from 1.25% to 1.00%.
Fixed Rate Administration Fee
GCICL will pay for all of the operating expenses of the Funds other than those operating expenses listed below, effective September 1, 2012, assuming the proposal is approved by securityholders. In return for paying the operating expenses, GCICL will receive a fixed rate administration fee from the Funds. The operating expenses that the Funds will continue to pay are costs and expenses relating to the independent review committee of the funds, new government or regulatory requirements, taxes, borrowing and interest and portfolio transaction costs. Until June 30, 2015, the Funds may pay an adjustment payment to GCICL in the event there is a significant drop in assets.
Currently, each Fund pays all of its own operating expenses, which comprise a portion of the management expense ratio of the Fund. If accepted this proposal will provide investors with increased predictability and transparency in fees as components of the management expense ratio for the Funds will become fixed rather than varying from year to year as they do presently.
Under the proposal, the fixed rate administration fee will range from 0.12% to 0.35% of the respective Fund's assets under management, depending on the Fund. The fee will be 0.12% to 0.20% for fixed income Funds, 0.14% to 0.22% for domestic balanced and equity Funds, 0.14% to 0.35% for global balanced and equity Funds, 0.16% to 0.30% for regional and specialty Funds and 0.13% to 0.27% for portfolio solutions. The fixed rate administration fee for each series of a Fund will be lower than or equal to the actual operating expenses paid by such series of the Fund during its most recently completed financial year. Similar fixed rate administrative fee proposals have been adopted by securityholders at a number of Canada's largest mutual fund companies.
GCICL referred the proposal to the Funds' Independent Review Committee and Board of Governors, which acts in an advisory capacity representing and enhancing the interests of securityholders. Each of the Independent Review Committee and the Board of Governors concluded that, in its view, the result of the fixed administration fee proposal is fair and reasonable to all Funds and their securityholders.
Securityholders are encouraged to visit www.dynamic.ca/mer to obtain detailed information regarding the impact of the fixed rate administration fee, and to review the amendment to the simplified prospectus for the Funds to be filed in connection with the proposal, which will be available at www.sedar.com, for complete information on the fixed rate administration fee applicable to the Funds, including the manner in which the fee will be calculated.
Other Proposed Changes
In addition to the proposed fixed administrative fees, GCICL today announced proposals to modify the language in the investment objectives of certain Funds, to change the performance fee index for Dynamic Strategic Energy Class and to increase the number of classes that are authorized to be issued by Dynamic Global Fund Corporation and Dynamic Managed Portfolios Ltd. These proposed changes will also be considered at the Special Meeting.
Investment Objectives
GCICL believes that the interests of securityholders of certain Funds will be better served by modifying the language in the investment objectives of those Funds. Appendix A contains a list of the applicable Funds and a summary of the current proposed modifications to the investment objectives.
Performance Fee Index
GCICL is proposing to amend the performance fee index for Dynamic Strategic Energy Class to include the S&P/TSX Capped Energy Index, in addition to its current index, the MSCI World Energy Index (C$). The performance fee indices are the reference indices against which the performance of Dynamic Strategic Energy Class is measured for the purpose of determining the amount of performance fees that the Fund may pay to GCICL. GCICL believes that the proposal to include the S&P/TSX Capped Energy Index better reflects the mandate of the Fund.
Increase in Classes Authorized for Issuance
Each corporate Fund is a class of shares of Dynamic Global Fund Corporation or Dynamic Managed Portfolios Ltd. (the "Corporations"). Each Corporation is currently authorized to issue a fixed number of classes of shares and both Corporations are very close to reaching their respective limits. As such, shareholders of the Corporations will be asked to approve an increase in the number of classes of shares that the Corporations are authorized to issue in order to permit additional corporate Funds to be created in the future.
Special Meeting of Securityholders
The Special Meeting will be held on or about August 21, 2012 to consider the proposed changes. In late July, securityholders of record as of the close of business on June 29, 2012 will receive an information circular with full details of the proposed changes as well as a proxy. The proposed changes are subject to the applicable Funds obtaining all necessary approvals, including securityholder approval.
About GCIC Ltd.
GCIC Ltd. is a subsidiary of DundeeWealth Inc. and the manager of the Dynamic Funds and the Marquis Investment Program. GCIC Ltd. offers a wide range of wealth management solutions through financial advisors. These include the mutual funds and hedge funds of Dynamic Funds, the portfolio solutions of the Marquis Investment Program and the high net worth investment counsel of DundeeWealth Investment Counsel. DundeeWealth Inc. is a wholly-owned subsidiary of Scotiabank.
The above is for informational purposes only and is not, and under no circumstances shall be construed as, an offering of the Dynamic Funds, the Marquis Investment Program or any other securities or as investment advice. Investors should read the simplified prospectus of the Dynamic Funds or the Marquis Investment Program, as applicable, for information about each Fund's investment objectives, strategies and the risks associated with an investment in the Fund before investing. Investors should discuss the suitability of the Funds with their investment advisor before making any investment decisions. Commissions, trailing commissions, management fees, performance fees and expenses all may be associated with mutual fund investments. Please read the simplified prospectus before investing. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated.
Caution regarding forward-looking statements
Certain portions of this news release may contain forward-looking statements about the Funds. Forward-looking statements include statements that are predictive in nature, that depend upon or refer to future events or conditions, or that include words such as "expects", "anticipates", "intends", "plans", "believes", "estimates" and similar forward-looking expressions or negative versions thereof. In addition, any statement that may be made concerning future performance, strategies or prospects, and possible future action, is also a forward-looking statement.
Forward-looking statements are inherently subject to, among other things, risks and uncertainties, some of which may be unforeseeable. Accordingly, assumptions concerning future economic and other factors may prove to be incorrect at a future date. Forward-looking statements are not guarantees of future performance, and actual events could differ materially from those expressed or implied in any forward-looking statements made in this new release. Any number of important factors could contribute to these digressions, including, but not limited to, failure to receive securityholder approval of the proposed changes at the Special Meeting. We stress that this list of important factors is not exhaustive.
We encourage you to consider these and other factors carefully before making any investment decisions and we urge you to avoid placing any undue reliance on forward-looking statements. Further, you should be aware of the fact that neither GCIC Ltd. nor the Funds have any specific intention of updating any forward-looking statements whether as a result of new information, future events or otherwise, except as required by law. For a complete disclosure record for the Funds, please visit their respective profiles at www.sedar.com.
Appendix A
For information on the rationale for the proposed changes below, please visit the "Dynamic in the News" section of www.dynamic.ca.
| Name of Fund | Current Investment Objective | Proposed Investment Objective |
| Dynamic Advantage Bond Class | Dynamic Advantage Bond Class seeks to provide maximum income and capital returns from an actively managed diversified portfolio of primarily Canadian fixed-income securities. | Dynamic Advantage Bond Class seeks to provide income while preserving capital through strategic investment in a diversified portfolio of primarily Canadian fixed-income securities. |
| Dynamic Advantage Bond Fund | Dynamic Advantage Bond Fund seeks to provide maximum income and capital returns from an actively managed diversified portfolio of primarily Canadian fixed-income securities. | Dynamic Advantage Bond Fund seeks to provide income while preserving capital through strategic investment in a diversified portfolio of primarily Canadian fixed-income securities. |
| Dynamic Blue Chip Balanced Class | Dynamic Blue Chip Balanced Class seeks to maximize returns and provide long-term growth of capital consistent with preserving capital and providing income by investing primarily in a full range of equity and fixed-income securities. | Dynamic Blue Chip Balanced Class seeks to maximize returns and provide long-term growth of capital consistent with preserving capital and providing income by investing primarily in a full range of U.S. equity and fixed-income securities. |
| Dynamic Canadian Bond Fund | Dynamic Canadian Bond Fund seeks to provide a portfolio with the minimum risk of income interruption and maximum income return primarily through investment in a diversified portfolio primarily of Canadian fixed-income securities including government and corporate bonds. | Dynamic Canadian Bond Fund seeks to provide income while preserving capital through investment in a diversified portfolio primarily of Canadian fixed-income securities including government and corporate bonds. |
| Dynamic High Yield Bond Fund | Dynamic High Yield Bond Fund seeks to achieve above average interest income and some potential for long-term capital growth by investing primarily in Canadian corporate bonds, preferred shares, income trusts, dividend-paying common shares and short-term debt obligations. | Dynamic High Yield Bond Fund seeks to achieve above-average interest income and the potential for some long-term capital growth by investing primarily in high yield corporate bonds or other income-producing securities. |
| Dynamic Dividend Fund | Dynamic Dividend Fund seeks to maximize dividend income through investment primarily in preferred and equity securities of Canadian companies. | Dynamic Dividend Fund seeks to provide dividend income through investment primarily in equity securities of Canadian companies. |
| Dynamic Dividend Income Class | Dynamic Dividend Income Class seeks to achieve moderate income through investment primarily in preferred and equity securities of Canadian companies, as well as in securities of other mutual funds. | Dynamic Dividend Income Class seeks to achieve moderate income through investment primarily in equity and fixed-income securities of Canadian companies. |
| Dynamic Dividend Income Fund | Dynamic Dividend Income Fund seeks to achieve moderate income through investment primarily in preferred and equity securities of Canadian companies. | Dynamic Dividend Income Fund seeks to achieve moderate income through investment primarily in equity and fixed-income securities of Canadian companies. |
| Dynamic Energy Income Fund | Dynamic Energy Income Fund seeks to achieve high income and long-term capital growth through investment primarily in equity securities of income trusts and other Canadian companies involved in energy-based or alternative energy activities. | Dynamic Energy Income Fund seeks to achieve high income and long-term capital growth through investment primarily in equity securities of Canadian companies involved in energy-based or alternative energy activities. |
| Dynamic Small Business Fund | Dynamic Small Business Fund seeks long-term capital appreciation through investment primarily in equity securities of relatively small Canadian businesses. | Dynamic Small Business Fund seeks to achieve long-term capital appreciation and income through investment primarily in equity securities of relatively small Canadian businesses. |
| Dynamic Dividend Value Fund | Dynamic Dividend Value Fund seeks to provide high current dividend income primarily from equity securities of Canadian businesses consistent with preservation of capital. | Dynamic Dividend Value Fund seeks to provide income and long-term capital appreciation by investing primarily in equity securities of Canadian businesses that pay a dividend or distribution. |
| Dynamic Global Infrastructure Fund | Dynamic Global Infrastructure Fund seeks to provide long-term capital growth primarily through investment in a diversified portfolio of infrastructure and related companies from around the globe. | Dynamic Global Infrastructure Fund seeks to provide long-term capital growth and income primarily through investment in a diversified portfolio of infrastructure and related companies from around the globe. |
| Dynamic Global Real Estate Fund | Dynamic Global Real Estate Fund seeks to achieve long-term capital appreciation primarily through investment in a diversified portfolio of equity and debt securities of businesses around the world with potential for increased value as a result of ownership, management or other investment in real estate assets. | Dynamic Global Real Estate Fund seeks to achieve long-term capital appreciation and income primarily through investment in a diversified portfolio of equity and debt securities of businesses around the world with potential for increased value as a result of ownership, management or other investment in real estate assets. |
| Dynamic Strategic Energy Class | Dynamic Strategic Energy Class seeks to provide long-term capital growth primarily through investment in a diversified portfolio of energy, alternative energy or related companies from around the globe. | Dynamic Strategic Energy Class seeks to provide long-term capital growth primarily through investment in a diversified portfolio of Canadian energy, alternative energy or related companies. |
| Dynamic Strategic Income Portfolio | Dynamic Strategic Income Portfolio seeks to achieve moderate income and to provide long-term growth of capital by investing primarily in a diversified portfolio of other mutual funds. The Fund maintains a diversified portfolio of income-generating securities, with exposure to preferred and equity securities of Canadian companies as well as domestic and foreign convertible debentures and fixed-income securities. | Dynamic Strategic Income Portfolio seeks to achieve moderate income and long-term capital growth by investing primarily in a diversified portfolio of fixed-income and income-producing equity mutual funds. |
| Dynamic Strategic Growth Portfolio | Dynamic Strategic Growth Portfolio seeks to achieve long-term growth of capital by investing primarily in units or shares of other open-end funds managed by us and high quality money market instruments. | Dynamic Strategic Growth Portfolio seeks to achieve long-term capital growth and a level of income by investing primarily in a diversified portfolio of equity and fixed-income mutual funds. |
| Marquis Balanced Income Portfolio | To seek moderate income and long-term capital growth, through a diversified portfolio with exposure primarily to domestic and foreign equity mutual funds as well as to fixed-income mutual funds. | Marquis Balanced Income Portfolio seeks to achieve moderate income and long-term capital growth by investing primarily in a diversified portfolio of fixed-income and equity mutual funds. |
| Marquis Balanced Portfolio | To seek a balance of income and long-term capital growth, through a diversified portfolio with exposure primarily to domestic fixed-income and equity mutual funds and, to a lesser extent, to foreign equity mutual funds. | Marquis Balanced Portfolio seeks to achieve a balance of income and long-term capital growth by investing primarily in a diversified portfolio of fixed-income and equity mutual funds. |
| Marquis Balanced Growth Portfolio | To achieve long-term capital growth. The Portfolio maintains a diversified portfolio with exposure primarily to domestic and foreign equity securities and, to a lesser extent, domestic and foreign fixed-income securities. | Marquis Balanced Growth Portfolio seeks to achieve long-term capital growth and a level of income by investing primarily in a diversified portfolio of equity and fixed-income mutual funds. |
| Marquis Balanced Growth Class Portfolio | The Marquis Balanced Growth Class Portfolio seeks to achieve long-term capital growth by investing primarily in a diversified portfolio of equity and, to a lesser extent, fixed-income mutual funds. | Marquis Balanced Growth Class Portfolio seeks to achieve long-term capital growth and a level of income by investing primarily in a diversified portfolio of equity and fixed-income mutual funds. |
| Marquis Growth Portfolio | To seek maximum long-term capital growth, through a diversified portfolio with exposure primarily to domestic and foreign equity mutual funds and, to a lesser extent, to fixed-income mutual funds. | Marquis Growth Portfolio seeks to achieve long-term capital growth by investing primarily in a diversified portfolio of equity and some fixed-income mutual funds. |
| Marquis Equity Portfolio | To maximize returns and provide long-term capital growth. The Portfolio maintains a diversified portfolio with exposure to domestic and foreign equity securities. | Marquis Equity Portfolio seeks to maximize long-term capital growth by investing primarily in a diversified portfolio of equity mutual funds. |
| Marquis Institutional Balanced Portfolio | To achieve a balance of income and capital growth by investing directly in fixed-income and equity mutual funds. | Marquis Institutional Balanced Portfolio seeks to achieve a balance of income and long-term capital growth by investing primarily in a diversified portfolio of fixed-income and equity mutual funds. |
| Marquis Institutional Balanced Growth Portfolio | To achieve long-term capital growth by investing directly in equity mutual funds. The Portfolio may also invest in fixed-income mutual funds and have direct exposure to Canadian fixed-income securities. | Marquis Institutional Balanced Growth Portfolio seeks to achieve long-term capital growth and a level of income by investing primarily in fixed-income and equity mutual funds. |
| Marquis Institutional Growth Portfolio | To achieve maximum long-term capital growth by investing primarily in a balanced portfolio of other mutual funds. The Portfolio maintains a diversified portfolio with exposure primarily to Canadian and foreign equity securities and, to a lesser extent, Canadian and foreign fixed-income securities. | Marquis Institutional Growth Portfolio seeks to achieve long-term capital growth by investing primarily in a diversified portfolio of equity and some fixed-income mutual funds. |
| Marquis Institutional Equity Portfolio | To maximize returns and provide long-term capital growth by investing directly in Canadian, U.S. and international equity funds. | Marquis Institutional Equity Portfolio seeks to maximize long-term capital growth by investing primarily in a diversified portfolio of equity mutual funds. |
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