Date Closed

June 5, 2006

Lead Office

Toronto

Value

155.20 Million CAD

On June 5, 2006, E.D. Smith Income Fund completed its indirect acquisition of the assets of Seaforth Creamery Inc. The combined businesses create the dominant North American producer in the private label pourable salad dressing category.

E.D. Smith Limited Partnership paid C$95.2 million in cash and securities exchangeable for units of the fund and agreed to make an additional payment conditional upon the achievement of pre-determined thresholds of 2006 adjusted EBITDA.
The fund also closed a treasury offering of 7.5 million subscription receipts representing the right to receive units of the fund for gross proceeds of C$60 million. The net proceeds of such offering were used, in part, to fund the Seaforth acquisition.
Since the Seaforth acquisition closed on the same date as the closing of the offering, the fund delivered units, instead of subscription receipts, to investors on the closing of the offering.  The offering was underwritten by a syndicate led by BMO Nesbitt Burns Inc. that also included CIBC World Markets Inc., RBC Dominion Securities Inc., Scotia Capital Inc., TD Securities Inc., Genuity Capital Markets G.P., Clarus Securities Inc. and Canaccord Capital Corporation. The fund also entered into new debt arrangements with the Bank of Montreal.

The underwriters were represented by McCarthy Tétrault LLP with a team that included Jonathan Grant, Robert Hansen and Domenic Di Sisto (securities); James Morand (tax); Joanna Rosengarten (environmental); Ian Bies and Jeanette Lee (IP) and Jamie Orzech (real property).