Covington Fund II Redemption Resource Centre

Covington Fund II Update March 9, 2018

The Board of Directors of Covington Fund II Inc. (the “Fund”) has approved the re-opening of the Fund on Monday May 7th, 2018 at 10am EDT to allow for the redemption of approximately $10 million by Class A Shareholders (“Redemption Limit”).  The $10 million in cash proceeds has been generated by Covington while it continues the process of selling portfolio holdings to meet the contemplated redemption requirement of 20%, or approximately $18 million, of the net asset value of the Fund, as at the most recent fiscal year end and as set out in both the governing legislation and in the Fund’s prospectus disclosure.
 
As the Fund progresses in the wind up process, there are several portfolio companies that are well advanced in sale negotiations. Proceeds, depending upon the amounts and the timing of their receipt by the Fund, could allow for an additional re-opening of the Fund to complete further redemptions prior to the Fund’s year end of August 31, 2018.
 
Q&A

I submitted a trade.  How can I confirm if it has been accepted and completed?

  • Shareholders and their advisors may contact our client services team at 1.888.746.4751 for specific account details.

  • Advisors can verify if a trade was completed successfully once the trade has posted on October 31, 2016 through CI’s Advisor Online or by contacting CI Client Services.

  • There is the possibility that some wire order requests will be accepted on FundSERV after the redemption threshold has been met, but before redemptions are capped on FundSERV. Therefore, some trades pending on FundSERV may be rejected at a later time as they were accepted after the Redemption Limit was reached.

How were redemptions processed?

  • The Fund processed redemption requests in the order in which they were received.

When will the next redemption opportunity for the Fund occur?

  • The Fund Manager anticipates that the next redemption opportunity will occur after September 1, 2017. Precise details will be announced closer to the date.  

Why is the Fund closed to redemption orders?

  • The Fund does not have enough liquid cash-on-hand to meet the very significant volume of redemption requests from investors and to operate the Fund in an efficient manner. The Board of Directors concluded that the temporary suspension of redemptions was required to optimize the return potential of the remaining portfolio of investments, in keeping with the original investment objectives of the Fund, and is in the best interests of shareholders.
  • The Manager is focused on optimizing the value of the portfolio of investments and is actively seeking liquidity opportunities for the remaining holdings where possible. 

 

Can I send in trade instructions now for future redemption opportunities?

  • No. Any trades submitted while the Fund is closed will be rejected. 

What fund codes are impacted?

  • CIG910, CIG912, CIG957, CIG958, CIG959, CIG960, CIG961, CIG980, CIG981, CIG982

Can Covington make allowances for trades that are submitted by the advisor, but delayed due to the time it takes back office systems to transmit trades to FundSERV?

  • No. Trades have been accepted on a first come, first serve basis based on the time at which trades are received by CI Investments. Covington will not be responsible for processing delays involving third parties.

 

Shareholder Account Details or Transaction Inquiries:

Covington Client Services   416.364.0759 or 1.888.746.4751

Fund Updates and Information

Covington Investor Relations
416.365.0060 or info@covingtonfunds.com