Provident Energy Trust Announces July 2003 Cash Distribution and Proposal to Amend Residency Requirement.Energy Editors/Business Editors CALGARY, Alberta--(BUSINESS WIRE)--July 9, 2003 Provident Energy Trust (TSX TSX Toronto Stock Exchange (TSE before April, 2002) TSX Transfer from Stack Pointer to Index TSX True Space Extension :PVE PVE, n an abbreviation for prosthetic valve endocarditis. See endocarditis, infective. .UN) (AMEX AMEX See: American Stock Exchange :PVX PVX Potato Virus X ): Proposal to Amend Residency Requirement Provident Energy Trust (TSX - PVE.UN: AMEX - PVX) announces that it intends to call a meeting of unitholders for September to seek approval of an amendment to its Trust Indenture An agreement declaring the benefits and obligations of two or more parties, often applicable in the context of Bankruptcy and bond trading. The term indenture primarily describes secured contracts and has several applications in U.S. law. to replace the present residency requirement with a more flexible requirement that would only apply where Provident determines that it is necessary to limit non-resident ownership in order to maintain Provident's status as a Mutual Fund Trust under Canadian tax legislation. Provident and its trustee, registrar and transfer agent, Computershare Trust Company of Canada, estimate, based on geographical address information available with respect to registered unitholders and unitholders holding through intermediary accounts, that approximately 55% of its units are presently beneficially owned by non-residents of Canada. Provident will continue to monitor the level of non-resident ownership of units on a periodic basis. However, based on the proposed amendments to its Trust Indenture, Provident believes that it is not appropriate at this time to impose restrictions on the transfer of its units to non-residents. The Trust Indenture governing Provident currently contains a residency requirement which provides that persons who are not residents of Canada may not hold more than one half of the outstanding units. This residency requirement was contained in the Trust Indenture as part of ensuring that Provident qualifies as a Mutual Fund Trust under a provision of Canadian tax legislation which generally requires that a Mutual Fund Trust cannot be established or maintained primarily for the benefit of non-residents of Canada. The retention of Mutual Fund Trust status under that legislation is important for both non-resident and resident holders of units and not just for Canadian tax exempt plans. Provident has been advised by its tax advisors A tax advisor is a financial expert especially trained in tax law. Some countries require tax advisors to verify the balance sheets of companies above a certain size. Individuals usually require tax advisors to minimize taxation, to avoid learning the details of tax law in that, based upon Provident's present and historic asset composition, Provident continues to qualify as a Mutual Fund Trust under Canadian tax legislation even though more than one half of its units may be held by persons who are not resident in Canada. However, so long as more than one half of Provident's units are held by non-residents, in order to continue to qualify as a Mutual Fund Trust on the basis of its asset composition, Provident is subject to certain restrictions with respect to the types of assets that Provident may hold. Tom Buchanan
Tom R. Buchanan (also known as Big Tom, born October 30, 1955) was a player on the CBS reality shows and . , Chief Executive Officer of Provident, stated: "While it is not essential at this time to enforce the residency requirement in the Trust Indenture in order to maintain Provident's status as a Mutual Fund Trust, Provident is of the view that it is important in the long term to ensure that it retains maximum flexibility to acquire assets and effectively execute its business plan. Provident continues to evaluate other measures that may assist in achieving these objectives." July 2003 Cash Distribution Provident also announces the cash distribution for July 2003 has been set at Cdn $0.17 per trust unit. The July 2003 cash distribution will be paid on August 15, 2003 to unitholders of record on July 21, 2003. The ex-distribution date ex-distribution date The first day of trading when the seller, rather than the buyer, of a stock will be entitled to a recently announced distribution of an asset. is July 17, 2003. For unitholders receiving their distribution in U.S. Funds, the August 15, 2003 cash distribution will be approximately U.S.$0.123, based on an exchange rate of 0.72630. The actual U.S. dollar distribution will depend on the U.S./Canadian dollar exchange rate on the payment date and will be subject to applicable withholding taxes The amount legally deducted from an employee's wages or salary by the employer, who uses it to prepay the charges imposed by the government on the employee's yearly earnings. . The decrease in the distribution is attributed to commodity prices. Based on the July 8, 2003 closing price of $11.26 (TSX - PVE.UN) per unit, the July distribution represents an annualized annualized Of or relating to a variable that has been mathematically converted to a yearly rate. Inflation and interest rates are generally annualized since it is on this basis that these two variables are ordinarily stated and compared. cash-on-cash yield Cash-on-Cash Yield A comparative measure using the total amount of distributions paid upon an income trust divided by its market value. Notes: This is a measurement technique used to compare different unit trusts. of approximately 18%. Provident Energy Trust is Calgary based, open-ended oil and gas trust that acquires, develops, produces and markets crude oil, natural gas and natural gas liquids and provides monthly cash distributions to its unitholders. |
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