Noranda Income Fund Unit NNDIF

RE: Thats a very special distribution.

[quest13]

Yes it is a very very very special distribution. I would liken it to the concept of "Unbirthday" in Alice in Wonderland.

It is what I call an accounting fiddle and it will be interesting to see if there is any market change after the announcement.

It is a statement that otherwise taxable income of
.48 per share (which is thus the profit for the year) will not be taxed in the hands of the fund; but in the hands of the Unitholders who will not get their hands on it because of what  believe to be the actions of Xstrata.

Forgive me Xstrata for my belief that you are the ones who insisted on the no payment of distributions clause. My belief that it is Xstrata that insisted on this clause comes from the fact that Xstrata guaranteed the loan ( which they were not obligated to do) and thus there was no need for such a clause from the bank's point of view.

I can see a legitimate reason for Xstrata to have done so and that is to continue pressure on the "Independent" trustees to negotiate a new loan which will not require the guarantee of Xstrata.

I stand to be corrected if my belief is in error. 

Also I concur in the belief that the "Independent" trustees are not working hard enough in the interests of the Priority Unitholders as otherwise they would have negotiated loans that did not require the guarantee of Xstrata.

On the other hand if they tried but did not succeed during the admittedly very short time frame squeeze they were caught in; they now have a period of peace till June 2nd, and subject to a 6 month extension if they are not successful by June 2nd, to obtain reasonable financing to allow payment of the distributions.

The good news is that a reasonably good profit is being made and they are admitting that.