E.D. Smith Income Fund postpones special meeting of unitholders to September 27, 2007



    WINONA, ON, Aug. 2 /CNW/ - Smith Income Fund (TSX: JAM.UN) (the "Fund")
announced today that the special meeting of unitholders called for August 28,
2007 will be postponed to September 27, 2007. The special meeting was called
to consider a special resolution approving the sale of all of the indirect
operating investments of the Fund to a subsidiary (the "Purchaser") of
TreeHouse Foods, Inc. ("TreeHouse") pursuant to a purchase and sale agreement
(the "Purchase Agreement") made between the Fund, E.D. Smith Limited
Partnership (the "Partnership") and E.D. Smith Operating Trust (the "Trust")
and the Purchaser and TreeHouse.
    In order to comply with the requirements of Canadian securities laws the
Fund is required to mail the management information circular and related
materials for the August 28 special meeting to unitholders on or before
August 3, 2007. The Board of the Fund has concluded that the circumstances
surrounding the resolution of certain tax related contingent liabilities at
this time are such that the meeting materials, if mailed on August 3, would
not provide the unitholders with sufficient clarity with respect to these
contingencies to permit them to make an informed decision regarding the
proposed transaction. As a consequence, the Board, after consultation with the
Purchaser, has determined to delay the special meeting and the preparation of
these materials until such time as they expect that more fulsome disclosure in
respect of these matters can be made.
    The Fund recently became aware that certain aspects of the transactions
completed concurrently with its initial public offering were effected in a
manner that may have created an unintended tax liability. The Fund believes
that this was inadvertent and the Partnership has applied to the Ontario
Superior Court of Justice for an order rectifying the documentation associated
with these transactions to correctly reflect the intention of the parties to
the transactions which, in turn, would eliminate the possibility of these
unintended tax consequences (the "Request"). A hearing relating to the Request
has been scheduled for August 24, 2007. The Canada Revenue Agency ("CRA") has
been notified of the hearing and the Request. The CRA may not fully support
the Request. Discussions with the CRA to determine its position on the Request
are ongoing.
    The Fund has recently been advised that the potential liability in
respect of these tax related contingent liabilities may, in certain
circumstances, exceed the $0.60 per unit holdback that the Fund announced
would be established on the completion of the transaction with the Purchaser.
The Fund has estimated, on the basis of information available to it, that the
additional liability could be in the range of $0.15 to $0.20 per Unit. If this
additional liability arises, the amount of the proceeds from the sale that
would be available to be distributed to unitholders would be reduced as
proceeds would have to be used to pay these liabilities.
    The liability in respect of the tax related contingencies will depend on
the disposition of the Request by the Court. Due to the fact that the hearing
is scheduled for August 24, it is unlikely that the results of the Court
hearing could be communicated to all unitholders before their votes would have
to be cast for a meeting on August 28.
    The Board has, therefore, determined to defer the special meeting until
more information as to the likely result of the Request becomes available, and
a more accurate estimate of the amount that will be distributed to unitholders
can be communicated to unitholders sufficiently in advance of the special
meeting.
    The postponement of the special meeting will not delay the closing of the
transaction, which is currently anticipated to occur in October 2007.

    About E.D. Smith Income Fund

    E.D. Smith Income Fund is an unincorporated, open-ended trust that owns
E.D. Smith & Sons, Limited (the "Company") and its subsidiaries. Founded in
1882 and headquartered in Winona, Ontario, E.D. Smith is a leading
manufacturer of a diverse portfolio of high quality branded and private label
food products. The Company markets and distributes its products to the food
retail and foodservice markets in Canada and the U.S. The Company's products
range from fruit-based products, which include jams (including jellies,
marmalades and spreads) pie fillings, and ketchup, to sauces, which include
pasta sauces, salsa, barbeque sauces specialty sauces and syrups, to pourable
and spoonable salad dressings and marinades.

    About TreeHouse Foods

    TreeHouse is a food manufacturer servicing primarily the retail grocery
and foodservice channels. Its products include pickles and related products;
non-dairy powdered coffee creamer; private label soup and infant feeding
products, salsa, Mexican sauces and other food products including aseptic
sauces, refrigerated salad dressings, and liquid non-dairy creamer. TreeHouse
believes it is the largest manufacturer of pickles and non-dairy powdered
creamer in the United States based on sales volume.

    Forward Looking Statements

    This press release contains "forward-looking information" as defined
under applicable securities law. Forward-looking information includes, but is
not limited to, statements with respect to the likelihood of concluding a
transaction pursuant to which the Purchaser will acquire all of the indirect
operating investments of the Fund, the amount of certain tax related
contingent liabilities of the Fund and the Partnership, the likelihood of
obtaining an order from the Court rectifying certain documentation and the
amount that will be available for distribution to unitholders of the Fund if a
sale of the Fund's indirect operating assets is in fact completed. In certain
cases, forward-looking information can be identified by the use of words such
as "plans", "expects" or "does not expect", "is expected", "intends",
"anticipates" or "does not anticipate", or "believes", or variations of such
words and phrases or state that certain actions, events or results "may",
"could", "would", "might" or "will be taken", "occur" or "be achieved".
Forward-looking information involves known and unknown risks, uncertainties
and other factors that may cause actual results, performance or achievements
to be materially different from any future results, performance or
achievements expressed or implied by the forward-looking information. Such
factors include, among others, the uncertainty associated with the negotiation
of a transaction to acquire all of the Fund's issued and outstanding units.
Although the Fund has attempted to identify important factors that could cause
actual actions, events or results to differ materially from those described in
forward-looking information, there may be other factors that cause actions,
events or results not to be as anticipated, estimated or intended. There can
be no assurance that forward-looking information will prove to be accurate, as
actual results and future events could differ materially from those
anticipated in such statements. Accordingly, investors should not place undue
reliance on forward-looking information. Forward-looking information is
provided as of the date of this material change report, and the Fund assumes
no obligation to update or revise such information to reflect new events or
circumstances.

    %SEDAR: 00022102E




For further information:

For further information: Bruce Smith, Executive Vice President & CFO,
E.D. Smith Income Fund, Tel: (905) 643-1211 ext. 5220, bsmith@edsmith.com;
Trevor Heisler, Investor Relations, The Equicom Group Inc., Tel: (416)
815-0700 ext. 270, theisler@equicomgroup.com

Organization Profile

E.D. SMITH INCOME FUND

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