Wellington Capital PIF/Octaviar (MFS) PIF

Re: Octaviar MFS Premium Income Fund PIF

A new PDS is a HUGE task, time consuming and very costly due to all the legal input necessary. I think someone in the SYD forum asked to keep the status quo of the fund as is and try and iron out issues till end of year. JH response was that people wanted certainty as to the direction of the fund and who would take the role of RE..this is why, and I have to agree a vote in August is right..sooner rather than later so that we can (and let WC) get on with it. I feel if another exit strategy as well as NSX for the fund down the track is the only huge stumbling block and believe will be resolved.

Re: Octaviar MFS Premium Income Fund PIF

Breaker have just emailed you a message

Can you confirm you have recieved

Thinking twice about posting anything on this site since we have been infiltrated

Re: Octaviar MFS Premium Income Fund PIF

I was at the Sydney meeting - been out of action for last two days, so this is the first opportunity I have had to provide my comments on the Wednesday Meeting.

I left the meeting with the following understandings:-

* following a call to vote on NSX listing when there was at least a 95% NAYE vote, Jenny said she was surprised, as she said that Melbourne was the opposite;

* when consistently pressured on whether she was listing on the NSX on 21Jul08, she said that, given the response from Sydney, that there would be NO listing on 21Jul08;

* when pressured again, she said that they would need to go away and review the whole redemption strategy, and that their proposal would form part of the documentation package to be offered to PIF investors prior to the August vote;

* she mentioned that at other meetings, that some investors had said that they would be willing to purchase units - issue is at what price;

* there was also some discussions about whether WC could create a mini exchange via their web site where there could be a listing of willing buyers and sellers - suggested that the $0.45 valuation would be the price;

* JH is genuinely seeking proposals which would allow some liquidity for unitholders who are not able or willing to stay with the fund, in whatever form - the real issue is the "fairness" test for short term vs long term redemptions.

* JH re-affirmed that WC were in possession of a number of "hardship" redemption requests. JH said that WC had already paid against a number of these requests, following due diligence on the degree of hardship, at the $0.45 per unit - there was also the commitment that, should there be further upside on all the investments, that additiional payments per unit could be made.

On balance, I found that she was prepared to consider all valid and fair comments from the floor - in Sydney, one investor even suggested that she should amend her fee structure, based on performance - i.e. rather than a flat 0.7%, have a progressive structure which pays more the closer she gets at returning the $1.00 per unit - she thought that was very interesting.

Right at the end, a suggestion was made that WC create a forum on their web site, complete with a Moderator - in this way, WC could hear the comments and suggestions from groups such as this. JH mentioned that the Investor base was many and varied, and that some preferred letters, some emails, some telephone calls - she said that she would seriously look at this proposal.

Anyway, these are my recollections from what I heard in Sydney - please advise if you heard anything different?

Re: Octaviar MFS Premium Income Fund PIF

goldfinger38 said:

Hi,

Just got message from my friend at Centrleink as per below,
He is recommending those investors that are pensioners who are NOT on full benefits or on any benefit because of the funds they hold in PIF , to notify Centrleink immediately of the reduction in the unit price value and to provide the Balance sheet particulars provided to PIF investors with the Net Asset Backing to prove the value at only 45c currently.

reply from Centrelink contact as follows:

MFS (now Octaviar) Premium Income Fund
MFS Ltd has frozen redemptions of its Premium Income Fund and ceased to pay distributions. MFS advises that this is a temporary measure aimed at protecting the assets of the fund.

Effective from 1 July 2008, the value of a customer's investment in the MFS Premium Income Fund should be re-assessed on their record at a value of 45 cents in the $1.00 per unit.

Deeming will continue to apply to this investment. A deeming exemption can not be granted at this point as the freezing of distributions and redemptions is continuing as a temporary measure.

MFS (now Octaviar) Ltd Shares
Shares in MFS/Octaviar Ltd have been suspended from trading on the Australian Stock Exchange (ASX). The last trading day was 18 January 2008.

Customers should continue to have their shares in MFS Ltd (ASX code MFS is now OCV) assessed at 99 cents per share.

Other MFS/Octaviar investments
There is no change to the assessment of other MFS/Octaviar investments.


Now we have no real way of knowing which of our customers have investments with MFS. We can only reassess their benefits when they bring their MFS investments to our attention.
Is it possible that you could inform those investors advising them of this change in their Centrelink assessment, and that they should contact Centrelink as soon as possible.?

Click to expand...

Goldfinger,
I just wish to thank you for your time and effort regarding the above result.

This morning I took a copy of the above post together with the Balance sheet statement from WC, and presented them to Centrelink. They were not aware of the changes, but on the strength of your post, the C/L officer dealing with me, went and searched his computer and found the new instructions, verbatim to your Post. I then told him the whole sad story.
My Unit value was immediately changed to 0.45c, considerably raising the amount of my then meagre, Age pension. Once again, I am most grateful.

After the officer finished my adjustment, he reached into his work tray and pulled out a bunch of WC statements. He then advised me that he had four other applications, waiting on a ruling from a copy he had sent to Canberra. He then proceeded to process these applications also. That will make
another four, very happy "Little Black Ducks," come next Thursday.

You certaily fixed their little red wagon !

Re: Octaviar MFS Premium Income Fund PIF

RickH said:

Hi Duped,
A)
Yes - you say there will be two classes of unit/share holders but I would hope that a loan type agreement could minimise some losses to those most vulnerable.
Capital Gains Tax will be claimed by the investor based on the original purchase and the final selling price - no problems.
B) The share price will probably not be taken in consideration for the fee charged by WC - The real NTA value of fund itself. It may also be possible for PIF to buy its own shares on the NSX and increase the NTA for the remaining investors.

There are potentially good and bad sides to everything nothing is perfect.
But the best option at this point in time appears to JH hands down.

Also we must remember that a little knowledge is dangerous and I would prefer to listen to what JH was planning and saying than anyone else at this point in time.
We are not solicitors and most of our discussions are very legally based. Leave this to the professionals.
We need to back JH all the way - after a reasonable presentation and goals.
Regards,
RickH

Click to expand...

You asked. I summarized. You responded.

I'll have to take your word for the loan type agreement.
I'll have to take your word for the CGT.
I'll have to take your word for the true NTA valuation
Agree with you on unit buyback.
Agree with you that nothing is perfect.
Agree with you that that WC is presently by far best option.
Agree with you that we are not professionals.

But JH asked for feedback and how the blazes would I know how I feel about NSX listing if I don't know anything about it. And that's what a non-pro poster like me is here for. Far as I recall, none of us non-pros has passed ourselves off as pros.

Good to have you on board with some answers.

Re: Octaviar MFS Premium Income Fund PIF

I would like to test AG members sentiment to the following:

It appears we want to keep the units among existing
unitholders so as not to create two unit classes by value (purchase price).

In the past our cheques were made to Perpetual Nominees who in turn issued the certificates.

Could we suggest to JH that Perpetual mediate sales between those who wish to exit the Fund and existing unitholders to increase their stake to average out their unit cost.

If we could strike a fair market value it would encourage a vote against liquidation.

I am a buyer as I have faith in the new management and would like to see the NSX scapped. Once trading commenced it would find a level of the true value of our units.

Comments please.

I would also like to nominate Mutchy to the committee.

Re: Octaviar MFS Premium Income Fund PIF

RickH said:

Hi,
What is soooooo wrong with the listing of PIF on the NSX?
Please consider and reply with all your reasons.
Regards,
Rick

Click to expand...

Hi Rickh, until somebody with a lot of power meaning JH, is prepared to investigate your proposal to assist those with dire financial problems,(which i might add looks to maybe be an answer for them)the way you appear to have proposed it. and she can give an answer about nsx>asx further down the track, you will not convince me that going the way of NSX is the right way to go,i believe we must have a clear direction from her which way she intends to go,i believe she could enlighten us tomorrow about this concern, for some reason she won't commit. i have no argument with your theory ,but its coming from the wrong person, cheers Flatback

Re: Octaviar MFS Premium Income Fund PIF

mgr2118 said:

I was at the Sydney meeting - been out of action for last two days, so this is the first opportunity I have had to provide my comments on the Wednesday Meeting.

I left the meeting with the following understandings:-

* following a call to vote on NSX listing when there was at least a 95% .........
.CUT.......................................
........................................................, and that some preferred letters, some emails, some telephone calls - she said that she would seriously look at this proposal.

Anyway, these are my recollections from what I heard in Sydney - please advise if you heard anything different?

Click to expand...

I agree with all your observations about the Sydney meeting, mgr2118. That is a good report.

I too expect JH to come up with an alternative to listing on the NSX as a means of providing redemptions to those who are in dire straits, based on what she said at the meeting.

I am firmly against listing on the NSX because, in addition to all the dilution of original unit holders with new low price unit holders and the potentially awful result, when we do get some way down the track with WC doing what JH proposes (historically share market downturns have not lasted more than 4 years and usually recover much more quickly) the NSX will be a very poor medium for trading units. I understand that the fund could unlist itself from what was said in discussion at Sydney but I don't know if that is possible and how hard it is to do ie constitution changes, other legal matters. IMHO better not to list at all and have a trading scheme run by WC.
Mutchy

Re: Octaviar MFS Premium Income Fund PIF

Dexter said:

I would like to test AG members sentiment to the following:

I would also like to nominate Mutchy to the committee.

Click to expand...

Dexter

It appears there is no elected committee, apart from only one area acting GC chairman Ron Haggart as per the GC news today with a $1M investment prepared to show his face in public at a public forum.

Please stop nominating non elected candiates.

Splitpin

Re: Octaviar MFS Premium Income Fund PIF

SPLITPIN said:

Dexter

It appears there is no elected committee, apart from only one area acting GC chairman Ron Haggart as per the GC news today with a $1M investment prepared to show his face in public at a public forum.

Please stop nominating non elected candiates.

Splitpin

Click to expand...

Gold coast, Port Macquarie and Newcastle have elected chairs, etc.

The others are planning to hold local meetings, after all the details of the forums come through.

Re: Octaviar MFS Premium Income Fund PIF

Jadel said:

Breaker have just emailed you a message

Can you confirm you have recieved

Thinking twice about posting anything on this site since we have been infiltrated

Click to expand...

Jadel

What is this nonsense.

After 50+ entries you cannot run away now when we need you most to be part of a balanced forum.

Everything must be fully transperant and within the law.

This is about democracry, a fair go, what our forum and Aust. is all about.

Hang in, have another glass and I am sure you will see it differently in the morning.

Splitpin

Re: Octaviar MFS Premium Income Fund PIF

Mutchy said:

I agree with all your observations about the Sydney meeting, mgr2118. That is a good report.

I too expect JH to come up with an alternative to listing on the NSX as a means of providing redemptions to those who are in dire straits, based on what she said at the meeting.

I am firmly against listing on the NSX because, in addition to all the dilution of original unit holders with new low price unit holders and the potentially awful result, when we do get some way down the track with WC doing what JH proposes (historically share market downturns have not lasted more than 4 years and usually recover much more quickly) the NSX will be a very poor medium for trading units. I understand that the fund could unlist itself from what was said in discussion at Sydney but I don't know if that is possible and how hard it is to do ie constitution changes, other legal matters. IMHO better not to list at all and have a trading scheme run by WC.
Mutchy

Click to expand...

Thanks Mutchy for your comments.

As we both heard, the NSX option is no longer the only option being considered by Jenny.

What we should be now doing is to use this forum to "constructively" provide alternatives that meet both the short term and long term objectives of the members.

Ideally, we would all love to get back to the monthly interest and return of capital after a set period - this was the basis of all of our initial decision making to participate in the PIF.

The resolution of this, I believe, is the fundamental issue that needs to be addressed by this forum.

My reading of the forum to date indicates that there are three (main) groups of investors representative of the forum:-

Group 1 - mainly interested in an income stream, with a hope that they get most of their capital back after a period (to be defined);

Group 2 - because of changes in circumstances, or because of the (previous) timing of their redemptions, they require their capital back ASAP;

Group 3 - dissillutioned - not happy - don't believe that there is any future for the PIF, so want to get out NOW.

Happy to hear if there are any other major groups.

All these groups want a clear statement on redemptions, and the value per unit on redemption.

The problem is that the PIF is no longer a LIQUID fund - there are no longer any new investors whose funds can be used to pay out those who want to leave.

SO

We all need to think about a FAIR methodology that can meet the requirements of all the groups (in listening to Jenny, I think that she thought the NSX would achieve that goal).

I believe that we have enough intelligent thinkers on this forum to put forward constructive proposals that can meet the requirements of all the groups - we can then use something like the Yahoo forum to vote on these proposals.

We don't have a lot of time between now and the vote in August, so, if we all believe that this is our key goal, then we should be spending our time working on this.

Happy to hear any other comments.

Youtube presentations on the MFS PIF

Here is the URL to watch the Wellington Capital presentation on plans for the MFS PIF:

http://www.newpif.com.au/investorforumjuly.html

Re: Octaviar MFS Premium Income Fund PIF

Effectively what JH is proposing is a normal STAPLED SECURITIES senario - you have fund units and listed units as has been proposed. Stapled securities are issued with an end date for total redemption (usually 5 years). In this way there is an ongoing market for the shares and a clearly defined conclusion for the fund. At the end of this date if you want to reinvest you simply invest in a new stapled securities issue.

Remember the Public Trustee of Qld is suing Octaviar over stapled securities that expire in 2011.

And yes the the trustee custodial role still applies to stapled securities.

This is not new to WC as all of the funds they operate are stapled security funds - just read the prospectus on the WC website.

It would seem to me that in our situation that 5 years would be the appropriate time frame for a stapled security fund. Effectively this imposes a 5 year moratorium on our fund which is not provided for in AUS legislation.

Re: Octaviar MFS Premium Income Fund PIF

marcom said:

Effectively what JH is proposing is a normal STAPLED SECURITIES senario - you have fund units and listed units as has been proposed. Stapled securities are issued with an end date for total redemption (usually 5 years). In this way there is an ongoing market for the shares and a clearly defined conclusion for the fund. At the end of this date if you want to reinvest you simply invest in a new stapled securities issue.

Remember the Public Trustee of Qld is suing Octaviar over stapled securities that expire in 2011.

And yes the the trustee custodial role still applies to stapled securities.

This is not new to WC as all of the funds they operate are stapled security funds - just read the prospectus on the WC website.

It would seem to me that in our situation that 5 years would be the appropriate time frame for a stapled security fund. Effectively this imposes a 5 year moratorium on our fund which is not provided for in AUS legislation.

Click to expand...

Marcom

Could you please give us an example caulation of how you would see this working if say I had 100 units now tied up in the fund and wished to sell say 20 immediately on the stock exchange, sell say another 20 next year on the stock exchange and assuming I get dividends as per the current WC offers and with a fund duration of say 5 years and wish to reinvest again.

This sample calculation would be greatly appreciated.

Splitpin.

Re: Octaviar MFS Premium Income Fund PIF

SPLITPIN said:

Marcom

Could you please give us an example caulation of how you would see this working if say I had 100 units now tied up in the fund and wished to sell say 20 immediately on the stock exchange, sell say another 20 next year on the stock exchange and assuming I get dividends as per the current WC offers and with a fund duration of say 5 years and wish to reinvest again.

This sample calculation would be greatly appreciated.

Splitpin.

Click to expand...

If you read the PDS for the WC funds on their (WC not PIF) site it will tell you all you need to know.

Re: Octaviar MFS Premium Income Fund PIF

marcom said:

Effectively what JH is proposing is a normal STAPLED SECURITIES senario - you have fund units and listed units as has been proposed. Stapled securities are issued with an end date for total redemption (usually 5 years). In this way there is an ongoing market for the shares and a clearly defined conclusion for the fund. At the end of this date if you want to reinvest you simply invest in a new stapled securities issue.

Remember the Public Trustee of Qld is suing Octaviar over stapled securities that expire in 2011.

And yes the the trustee custodial role still applies to stapled securities.

This is not new to WC as all of the funds they operate are stapled security funds - just read the prospectus on the WC website.

It would seem to me that in our situation that 5 years would be the appropriate time frame for a stapled security fund. Effectively this imposes a 5 year moratorium on our fund which is not provided for in AUS legislation.

Click to expand...

Thats news to me where on earth did you get that information Eric

Re: Octaviar MFS Premium Income Fund PIF

marcom said:

If you read the PDS for the WC funds on their (WC not PIF) site it will tell you all you need to know.

Click to expand...

I had a look on that site & cant find that information JH never said anything at the Brisbane meeting about stapled shares with a 5 year distance Tell us all when she said this please Eric

Re: Octaviar MFS Premium Income Fund PIF

mgr2118 said:

Thanks Mutchy for your comments.

As we both heard, the NSX option is no longer the only option being considered by Jenny.

What we should be now doing is to use this forum to "constructively" provide alternatives that meet both the short term and long term objectives of the members.

Ideally, we would all love to get back to the monthly interest and return of capital after a set period - this was the basis of all of our initial decision making to participate in the PIF.

The resolution of this, I believe, is the fundamental issue that needs to be addressed by this forum.

My reading of the forum to date indicates that there are three (main) groups of investors representative of the forum:-

Group 1 - mainly interested in an income stream, with a hope that they get most of their capital back after a period (to be defined);

Group 2 - because of changes in circumstances, or because of the (previous) timing of their redemptions, they require their capital back ASAP;

Group 3 - dissillutioned - not happy - don't believe that there is any future for the PIF, so want to get out NOW.

Happy to hear if there are any other major groups.

All these groups want a clear statement on redemptions, and the value per unit on redemption.

The problem is that the PIF is no longer a LIQUID fund - there are no longer any new investors whose funds can be used to pay out those who want to leave.

SO

We all need to think about a FAIR methodology that can meet the requirements of all the groups (in listening to Jenny, I think that she thought the NSX would achieve that goal).

I believe that we have enough intelligent thinkers on this forum to put forward constructive proposals that can meet the requirements of all the groups - we can then use something like the Yahoo forum to vote on these proposals.

We don't have a lot of time between now and the vote in August, so, if we all believe that this is our key goal, then we should be spending our time working on this.

Happy to hear any other comments.

Click to expand...

None of you get it do you Wellington is in the business of making money for Wellington NOT US Eric

Re: Octaviar MFS Premium Income Fund PIF

Jadel said:

Goldfinger thank you for taking half a page to tell us the patently obvious

A Neanderthal with half a brain can work our that any trades on the NSX is not going to effect the price of the units

That is not the POINT MATE we do want OUR UNITS BEING Sold on the NSX by the financially desperate and sick to predatory scavengers because over time it will inevitably reduce the existing base of Investors

And these holders who enter at a pittance will not care TWO CENTS about what happens to the ORIGINAL HOLDERS

Therefore we as a group will be disadvantaged on any decisions that we need to take to protect our LONG TERM INTERESTS

Now if Jenny Hutson was too come up with some sort of original scheme whereby only existing unit holders buy from other unit holders that need to sell, at a discount that would be an excellent idea

The existing holders have got the most to lose and we know that they are averaging down to save their original investment and will be in for the long term therefore as a group we retain our long term investor base .And that is the most important point mate.

Click to expand...

Hi Chris,
From RickH. - Financial adviser to more 150 clients invested into PIF.
I wish to refer to your previous statement and I agree completelywith your statement "A Neanderthal with half a brain can work our that any trades on the NSX is not going to effect the price of the units" on the understanding that we are both talking about the NTA value.
I believe that you may be looking at my statements incorrectly. Please refer to everything that I have listed.
1) My agenda is to try and recover 100% of my clients funds and in the process that will recover 100% of all investors funds.
2) 'Original Scheme' - It may be possible to create a loan type fund within PIF to advance on a drip feed basis to 'original' investors who have a desperate need for a regular cash flow to cover regular on-going living expenses.
The loan could possibly be organised within PIF using the borrowers' units/shares as security based on the current net value 14 cents and up to 45 cents within 24 months? This will at least defer and may even stop the need to sell units.
3) The listing of the MFS units on the NSX is just a vehicle that may help JH to raise extra funds (being a Merchant Banker) to enable this vehicle to grow to the value of at least $1.00 over the next 3-5 years. IF she has a reasonable plan to present to all unit holders it should be considered because at this point in time the quick sale value of the units is 14 cents and say 46 cents in 2-3 years.

My agenda does not include the selling of units at 14 cents becaues this may decimate a persons life savings. I want at least $1.00 returned and if we can also receive 6 cents per annum that would be a fantastic result for everyone and that includes you, my clients and me.

Please remember that the major problem at this point in time is to get 75% of the actual votes to be positive and continue the PIF for at least five but preferably a longer term because I believe that this will benefit everyone currently involved in the PIF that is a regular income investment fund[/U]

Kindest Regards,
Rick

PS: IF the November & December 'loans/gifts' or any other investments are not covered by the PDS etc – I believe that those people should be held fully accountable - via monetary plus jail terms. But let us get the correct structure to enable JH to do her best and not be hindered in any way – subject to a reasonable presentation and plans…