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Unit Information
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The Trust Units of Enbridge Income Fund (the "Fund") are listed on the TSX and trade under the symbol ENF.UN. 58% of the Trust Units are widely held by Canadian institutional and retail investors and 42% are held by Enbridge Inc.
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Enbridge Inc. (TSX / NYSE: ENB) sponsors and indirectly manages the Fund. Enbridge holds interests in the Fund through Trust Units of the Fund and Preferred Units ("ECT Preferred Units") of Enbridge Commercial Trust ("ECT"), a subsidiary entity of the Fund. The Trust Units held by Enbridge are entitled to approximately 20% of the Fund's distributions and carry approximately 42% of the voting rights. The ECT Preferred Units held by Enbridge are entitled to approximately 52% of the Fund's distributions and do not have any voting rights.
The following table sets out the trust unit capitalization of the Fund and the preferred unit capitalization of ECT as at December 31, 2008:
|
Holders |
Outstanding
(Millions) |
% Entitlement
to Distributions |
% of Votes |
Trust Units of the Fund |
Public |
20.1 |
28% |
58% |
Trust Units of the Fund |
Enbridge Inc. |
14.5 |
20% |
42% |
Preferred Units of ECT |
Enbridge Inc. |
38.0 |
52% |
— |
Total |
|
|
100% |
100% |
Trust Units of the Fund
The beneficial interests in the Fund are represented and constituted by Trust Units. 20,125,000 of the currently outstanding Trust Units are listed and publicly traded on the Toronto Stock Exchange, while 14,500,000 Trust Units, all of which are owned by Enbridge and which, until July 1, 2008, were subject to a subordination provision in respect of distributions, are not listed. An unlimited number of Trust Units may be issued. At December 31, 2009, there were 34,625,000 Trust Units outstanding.
The distribution priority previously accorded to the publicly listed Trust Units, over the units owned by Enbridge, unconditionally terminated on July 1, 2008. As a result, the publicly listed Trust Units and the formerly subordinated Trust Units are now equal in all respects, without discrimination, preference or priority, including but not limited to distributions and voting. The Fund Trust Indenture provides that the holders of all Trust Units shall vote together as a single class in respect of all matters to be put before unitholders for vote.
^ top of page Preferred Units of ECT
The ECT Preferred Units do not carry any voting rights except in certain specified circumstances. For each ECT Preferred Unit a holder is entitled to a monthly cash distribution equal to the monthly cash distribution per Trust Unit. The ECT Preferred Units mature on June 30, 2033 at which time ECT is obligated to redeem all of the outstanding ECT Preferred Units for a price of $10.00 per unit.
The terms of the ECT Preferred Units also provide that a holder of ECT Preferred Units has the right (the "Liquidity Right") to request ECT to purchase, for cancellation, all or any portion of the ECT Preferred Units owned by such holder. If ECT receives such a purchase request from a holder of ECT Preferred Units, ECT is required to use its best efforts to secure the necessary funds (on terms acceptable to the Independent Trustees of ECT and the holder of the subject ECT Preferred Units to be repurchased, each acting reasonably) to enable it to purchase such units.
If the Liquidity Right is exercised, ECT expects to finance repurchases of ECT Preferred Units by issuing additional ECT Units or ECT Notes, or both, to the Fund (the purchase of which, by the Fund, may be financed through an offering of Trust Units or other securities of the Fund), by increasing the consolidated indebtedness of the Fund, from cash flows of ECT or some combination thereof.
If all or part of the repurchase of ECT Preferred Units is funded by the issuance of additional Trust Units by the Fund, the repurchase price per ECT Preferred Unit shall be equal to the net issue price per Trust Units issued by the Fund. Otherwise the repurchase price for the ECT Preferred Unit shall be equal to the net issue price per Trust Unit that would have been realized if a public offering of Trust Units had been made by the Fund. The reasonable costs directly attributable to a public offering of Trust Units to finance the repurchase of ECT Preferred Units will be borne by the holder of the repurchased ECT Preferred Units.
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