Picton Mahoney Tactical Income Fund Announces Plan for Termination of its Forward Agreement and Changes to Investment Objectives

TORONTO, Aug. 25, 2017 /CNW/ - Picton Mahoney Asset Management (the "Manager"), as manager of Picton Mahoney Tactical Income Fund (the "Fund") (TSX: PMB.UN), announces that the Fund's forward agreement (the "Forward Agreement") will terminate on October 18, 2017, its scheduled termination date (the "Termination Date"). Currently, the Fund obtains exposure to a diversified portfolio of income producing securities held by a reference fund, Income Strategies Trust, through the Forward Agreement.

The Income Tax Act (Canada) was amended in December 2013 to implement proposals that were first announced in the March 21, 2013 federal budget regarding the income tax treatment of character conversion transactions (the "Tax Changes"). Under the Tax Changes, the tax efficient treatment of character conversion transactions will be eliminated after the Termination Date. As a result of the Tax Changes, the Forward Agreement will no longer be able, following the Termination Date, to provide the same material tax efficiency to unitholders of the Fund.

Following the Termination Date, the Fund will invest directly in substantially the same securities currently held in the underlying portfolio held by Income Strategies Trust.  The Manager intends to continue to pursue the Fund's investment strategy directly without the Forward Agreement or Income Strategies Trust. Subject to regulatory approval, the Manager expects, on or about the Termination Date, that the Fund will amend its declaration of trust and other related documents to delete references to "tax-advantaged" distributions and to remove all references to the use of the Forward Agreement to gain exposure to Income Strategies Trust. The investment objectives of the Fund after the amendments will be to: (i) provide unitholders with sustainable monthly distributions; (ii) preserve capital and mitigate risk with less volatility and less correlation to high-yield and equity markets; and (iii) maximize total return to unitholders through distributions and capital appreciation.

SOURCE Picton Mahoney Asset Management

Arthur Galloway, Picton Mahoney Asset Management, Tel: [phone], Website: www.pictonmahoney.com, Email: [email protected]

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