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Horizons ETFs holders approve move to corporate class

2019-11-12 21:10 ET - News Release

See News Release (C-HIX) BetaPro S&P/TSX 60 Daily Inverse ETF

Mr. Steve Hawkins reports

HORIZONS ETFS ANNOUNCES UNITHOLDER APPROVAL OF PROPOSED CORPORATE CLASS REORGANIZATION FOR CERTAIN ETFS

At special meetings of the unitholders of the exchange-traded funds in the attached table, held on Nov. 12, 2019, unitholders of the ETFs approved all matters relating to the merger of each ETF, currently structured as a trust, into a corresponding class of shares of a new multiclass corporate fund structure to be managed by Horizons ETFs Management (Canada) Inc., all as further described in the management information circular dated Oct. 4, 2019, previously mailed to unitholders.

Other than BetaPro Gold Bullion -2x Daily Bear ETF (HBD), the meeting of which has been adjourned until Wednesday, Nov. 13, 2019, all of the exchange-traded funds set out in Horizons ETFs' press release dated Aug. 23, 2019, have received unitholder approval for reorganization into the corporate-class structure. Horizons ETFs anticipates that it will provide an update on the unitholder vote for HBD on Nov. 13, 2019.

Listed in the table are the ETFs that have received unitholder approval to merge into the multiclass corporate fund structure.

       REORGANIZATION INTO CORPORATE CLASS TO BE EFFECTIVE
                  AS OF END OF DAY, NOV. 27, 2019
ETF name                                                   Ticker

BetaPro Gold Bullion 2x Daily Bull ETF                        HBU
BetaPro Crude Oil 2x Daily Bull ETF                           HOU
BetaPro Crude Oil -2x Daily Bear ETF                          HOD
BetaPro Natural Gas 2x Daily Bull ETF                         HNU
BetaPro Natural Gas -2x Daily Bear ETF                        HND
BetaPro Silver 2x Daily Bull ETF                              HZU
BetaPro Silver -2x Daily Bear ETF                             HZD
BetaPro S&P/TSX 60 2x Daily Bull ETF                          HXU
BetaPro S&P/TSX 60 -2x Daily Bear ETF                         HXD
BetaPro S&P/TSX Capped Financials 2x Daily Bull ETF           HFU
BetaPro S&P/TSX Capped Financials -2x Daily Bear ETF          HFD
BetaPro S&P/TSX Capped Energy 2x Daily Bull ETF               HEU
BetaPro S&P/TSX Capped Energy -2x Daily Bear ETF              HED
BetaPro NASDAQ-100 2x Daily Bull ETF                          HQU
BetaPro NASDAQ-100 -2x Daily Bear ETF                         HQD
BetaPro S&P 500 2x Daily Bull ETF                             HSU
BetaPro S&P 500 -2x Daily Bear ETF                            HSD
BetaPro Canadian Gold Miners 2x Daily Bull ETF                HGU
BetaPro Canadian Gold Miners -2x Daily Bear ETF               HGD
BetaPro Marijuana Companies 2x Daily Bull ETF                HMJU
BetaPro Marijuana Companies Inverse ETF                      HMJI
BetaPro S&P/TSX 60 Daily Inverse ETF                          HIX
BetaPro S&P 500 Daily Inverse ETF                             HIU
BetaPro S&P 500 VIX Short-Term Futures ETF                    HUV
Horizons Gold ETF                                             HUG
Horizons Silver ETF                                           HUZ
Horizons Crude Oil ETF                                        HUC
Horizons Natural Gas ETF                                      HUN

       REORGANIZATION INTO CORPORATE CLASS TO BE EFFECTIVE
                  AS OF END OF DAY, NOV. 29, 2019
ETF name                                                   Ticker

Horizons S&P/TSX 60 Index ETF                                 HXT
Horizons S&P 500 Index ETF                                    HXS
Horizons S&P 500 CAD Hedged Index ETF                         HSH
Horizons S&P/TSX Capped Energy Index ETF                      HXE
Horizons S&P/TSX Capped Financials Index ETF                  HXF
Horizons Cdn Select Universe Bond ETF                         HBB
Horizons NASDAQ-100 Index ETF                                 HXQ
Horizons EURO STOXX 50 Index ETF                              HXX
Horizons Cdn High Dividend Index ETF                          HXH
Horizons U.S. 7-10 Year Treasury Bond ETF                     HTB
Horizons U.S. 7-10 Year Treasury Bond CAD Hedged ETF          HTH
Horizons Laddered Canadian Preferred Share Index ETF         HLPR
Horizons Intl Developed Markets Equity Index ETF             HXDM
Horizons Equal Weight Canada REIT Index ETF                  HCRE         
Horizons Equal Weight Canada Banks Index ETF                 HEWB     

The necessary regulatory and independent review committee approvals have also been received.

Accordingly, Horizons ETFs expects to proceed with the mergers on Nov. 27 and Nov. 29, 2019, as indicated in the table. The ETFs will continue to trade as normal up until the mergers and will continue trading on the trading day following the mergers under the same tickers.

"We are excited to have completed this last stage of the approval process and thank our unitholders for their ongoing support throughout the corporate-class reorganization," said Steve Hawkins, president and chief executive officer of Horizons ETFs. "With the completion of the reorganization expected before the end of the month, we are putting the proposed changes to the Income Tax Act behind us and moving forward to the next stage of innovation for our tax-efficient ETF suite, which also includes our BetaPro ETFs."

It is important to note that these ETFs are not expected to carry forward any tax liability into the proposed multiclass corporate fund structure, and no historical or retroactive taxable implications to unitholders of these ETFs are expected.

The reorganization is not expected to be a taxable event for unitholders of the ETFs, provided that, in the case of Canadian resident unitholders who hold units of the ETFs in taxable accounts, such unitholders make a joint election with the proposed multiclass corporate fund structure under Section 85 of the Income Tax Act (Canada) as part of the exchange from their existing trust units into shares of a class of the new corporate fund structure. Horizons ETFs is establishing a process to provide assistance to unitholders in taking the necessary steps to file the joint election, which will be free of charge. Additional information can be found on the Horizons ETFs website.

About Horizons ETFs Management (Canada) Inc.

Horizons ETFs Management (Canada) is an innovative financial services company and offers one of the largest suites of exchange-traded funds in Canada. The Horizons ETFs product family includes a broadly diversified range of solutions for investors of all experience levels to meet their investment objectives in a variety of market conditions. Horizons ETFs has approximately $10-billion of assets under management and 91 ETFs listed on major Canadian stock exchanges.

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