National Bank Securities Inc. announces a proposal for a fixed-rate administration fee to increase the predictability and clarity of Meritage Portfolio expenses as well as other proposals pertaining to the Meritage Portfolios

MONTREAL, Aug. 1, 2013 /CNW Telbec/ - National Bank Securities Inc. ("NBS") today announced a proposal to change the way operating expenses are charged to the Meritage Portfolios (the "Administration Fee Proposal"). Securityholders will be asked to vote on the Administration Fee Proposal, as well as other proposals described below, at a special meeting to be held on or about October 22, 2013 (the "Special Meeting").

"This proposal is intended to protect securityholders from potential increases in certain operating expenses. These increases will now be borne by National Bank Securities," said Michel Falk, President and Chief Executive Officer of NBS. "This proposal, if it receives securityholder approval, will result in greater predictability and clarity of expenses," he added.

If the Administration Fee Proposal is approved by the securityholders, NBS will start to pay, on or about October 29, 2013, all operating expenses of the Meritage Portfolios except the portfolio costs listed below. In return, the Meritage Portfolios will pay a fixed-rate administration fee to NBS. The fixed-rate administration fee for each Meritage Portfolio will be less than or equal to the actual operating expenses paid by each Meritage Portfolio during the last six-month period.

Currently, each Meritage Portfolio bears all of its operating expenses. If the Administration Fee Proposal is approved by the securityholders, the operating expenses payable by NBS will include transfer agency and recordkeeping costs, custodial costs, accounting and valuation fees, audit fees, legal fees, the costs of preparing and distributing financial reports, simplified prospectuses, annual information forms, fund facts, continuous disclosure documents and other investor communications and the costs of trustee services relating to registered tax plans. NBS will pay these expenses, provided such expenses are incurred in the normal course of business of the Meritage Portfolios.

The portfolio costs that will continue to be paid by the Meritage Portfolios will include taxes, the costs of complying with any material change to existing regulatory requirements and/or any new regulatory requirements, including any new fees introduced after August 1, 2013, interest and borrowing costs, fees related to external services that were not commonly charged in the Canadian mutual fund industry as at August 1, 2013, fees and expenses related to National Bank Funds Corporation's board of directors, fees and expenses of the Independent Review Committee ("IRC") and operating expenses relating to the operating expenses payable by NBS that are incurred outside the normal course of business of the Meritage Portfolios.

The fixed-rate administration fee will be subject to a transitional adjustment payment up to December 31, 2013. Similar fixed-rate administration fee proposals have been approved by the securityholders of other mutual funds managed by large Canadian corporations.

The Administration Fee Proposal was submitted to the Meritage Portfolios' Independent Review Committee (the "IRC"). The IRC considered the Administration Fee Proposal and determined that, if implemented, it would achieve a fair and reasonable result for the Meritage Portfolios.

Other proposed changes to the Meritage Corporate Portfolios

At the Special Meeting, the shareholders of the Meritage Corporate Portfolios will also be asked to vote on changes to the fundamental investment objectives of the Meritage Corporate Portfolios that would allow, in particular, each such Portfolio to invest in its equivalent Trust Portfolio. Appendix A provides a summary of the proposed changes in this regard. If the changes to the investment objectives are approved by the shareholders of the Meritage Corporate Portfolios and the exemptive relief necessary to implement the proposed investment objectives is obtained from the Canadian Securities Authorities, the fund investment strategies will be revised accordingly.

Subject to receipt of shareholder approval and the above-mentioned exemptive relief, the proposed changes to the investment objectives will take effect on or about October 29, 2013.

Finally, the shareholders of the Meritage Corporate Portfolios will be asked to vote on a change to the redemption rights of the Meritage Corporate Portfolios that would permit such Portfolios to redeem shares more efficiently when closing series that are no longer economically viable or that have become, in any way, detrimental to investors or the Portfolio.

Securityholders are asked to refer to the amendments to the simplified prospectus and the Annual Information Form of the Meritage Portfolios, which will be filed shortly and will contain the relevant information concerning the proposals. These amendments will be posted on www.sedar.com

All information pertaining to the changes proposed as part of the Special Meeting will be provided to current investors, and potential investors can obtain this information from National Bank Securities Inc. prior to the Special Meeting. The time and place of the Special Meeting will appear in the notice of meeting and management circular which shall be mailed to securityholders. In addition, this information will be posted on www.sedar.com and will be available from your advisor or from National Bank Securities Inc.

About National Bank Securities Inc.
The Meritage Portfolios (the "Portfolios") are offered by National Bank Securities Inc., a wholly-owned subsidiary of National Bank of Canada. Commissions, trailing commissions, management fees and expenses all may be associated with investments in the Portfolios. Please read the prospectus of the Portfolios before investing. The Portfolio' securities are not insured by the Canada Deposit Insurance Corporation or by any other government deposit insurer. The Portfolios are not guaranteed, their values change frequently and past performance may not be repeated.

About National Bank of Canada
With $185 billion in assets as at April 30, 2013, National Bank of Canada (www.nbc.ca), together with its subsidiaries, forms one of Canada's leading integrated financial groups, and was named among the 20 strongest banks in the world by Bloomberg Markets. The Bank has close to 20,000 employees and is widely recognized as a top employer. Its securities are listed on the Toronto Stock Exchange (TSX: NA). Follow the Bank's activities via social media and learn more about its extensive community involvement at clearfacts.ca and commitment.nationalbank.ca.

APPENDIX A

Portfolio	Current Investment Objective	Proposed New Investment Objective
Meritage Canadian Equity Class Portfolio	The Portfolio's investment objectives are to achieve long-term capital appreciation by investing primarily in a diverse mix of Canadian equity mutual funds.	The Portfolio's investment objective is to obtain a comparable return to that of the Meritage Canadian Equity Portfolio (the "Underlying Fund"). The Portfolio invests mainly in units of the Underlying Fund and/or in securities of the mutual funds held by the Underlying Fund and/or in mutual funds similar to those funds, based on a similar weighting to that used by the Underlying Fund.
Meritage Global Equity Class Portfolio	The Portfolio's investment objectives are to achieve long-term capital appreciation by investing primarily in a diverse mix of global equity mutual funds.	The Portfolio's investment objective is to obtain a comparable return to that of the Meritage Global Equity Portfolio (the "Underlying Fund"). The Portfolio invests mainly in units of the Underlying Fund and/or in securities of the mutual funds held by the Underlying Fund and/or in mutual funds similar to those funds, based on a similar weighting to that used by the Underlying Fund.
Meritage Growth Class Portfolio	The Portfolio's investment objectives are to achieve long-term capital appreciation by investing primarily in a diverse mix of fixed-income and equity mutual funds.	The Portfolio's investment objective is to obtain a comparable return to that of the Meritage Growth Portfolio (the "Underlying Fund"). The Portfolio invests mainly in units of the Underlying Fund and/or in securities of the mutual funds held by the Underlying Fund and/or in mutual funds similar to those funds, based on a similar weighting to that used by the Underlying Fund.
Meritage Equity Class Portfolio	The Portfolio's investment objectives are to achieve long-term capital appreciation by investing primarily in a diverse mix of fixed-income and equity mutual funds.	The Portfolio's investment objective is to obtain a comparable return to that of the Meritage Equity Portfolio (the "Underlying Fund"). The Portfolio invests mainly in units of the Underlying Fund and/or in securities of the mutual funds held by the Underlying Fund and/or in mutual funds similar to those funds, based on a similar weighting to that used by the Underlying Fund.

 

 

SOURCE: National Bank of Canada

(The telephone number provided below is for the exclusive use of journalists and other media representatives.)

Marie-Pierre Jodoin
Senior Advisor - Public Affairs
National Bank
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