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The North Growth Currency Hedge Limited Partnership (the Partnership), was created to reduce exposure to the Canadian dollar to
US dollar currency risk inherent in investing in the North Growth US Equity Fund from a Canadian investor's perspective.
The Partnership will consist of NGM Currency Hedge GP Ltd. (the "General Partner"), a 100% owned subsidary of North Growth Management Ltd.,
and unitholders of the North Growth US Equity Fund as the Limited Partners. Only "Accredited Investors" with a minimum investment of
C$250,000 in the North Growth US Equity Fund will be eligible to become Limited Partners of the Partnership. Limited Partners will be permitted
to hedge the currency exposure of up to a maximum of 95% of their investment in the North Growth US Equity Fund.
The General Partner will manage the Partnership. The Partnership will invest in exchange traded Canadian dollar futures in order to hedge away
the currency risk. This will result in the Partnership effectively shorting the US dollar, thus offsetting the long US dollar position inherent
in owning US equities. In order to establish these positions in exchange traded futures the Partnership will employ a substantial degree of leverage. A
Limited Partner will be required to contribute 2 times the margin required by the Chicago Mercantile Exchange for a given level of hedge. For a hedge
on C$100,000 a Limited Partner would be required to contribute approximately C$3,500 or 3.5%.
North Growth Management has developed an accounting system that will maintain individual capital accounts for each Limited Partner. A Limited Partner's capital
account will consist of the capital it contributed to the Partnership, plus the aggregate of its pro rata share of daily net income or loss from the Partnership's
investing activities. The daily net income or loss of the Partnership will include a daily management fee of 0.50% per annum of the total "Hedged Amount" of the Partnership.
In order to ensure that no Limited Partner has insufficient margin for the "Hedged Amount" represented by its Partnership Units, the Limited Partnership Agreement
includes a power of attorney which authorizes the General Partner to redeem sufficient units of the Limited Partner's holding in the North Growth US Equity Fund
to bring its capital balance back to the 2 times threshold should its capital drop to 1.5 times or less.
The General Partner will maintain the records of the Partnership. It will provide each Limited Partner with a Statement of Partnership Income for income tax purposes.
All income or losses from the Partnership will be normal business income or losses for tax purposes.
Deloitte and Touche LLP will audit the Partnership's Financial Statements.
As this is a complex financial instrument North Growth Management strongly encourages potential investors to consult their legal and accounting experts prior to becoming a
Limited Partner.
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