Northwater Market-Neutral Trust update on status of wind-up

    TORONTO, Sept. 1 /CNW/ - The Northwater Market-Neutral Trust (the
"Trust") today is providing investors with a further update on the status of
the liquidation of the Trust's assets in connection with the December 31, 2009
(the "Termination Date") termination of the Trust.
    In anticipation of the termination of the Trust Northwater Fund
Management Inc. (the "Manager"), the Manager of the Trust, has taken actions
to liquidate the assets of the Trust. However, as announced previously, market
conditions have caused many underlying hedge funds held by the Trust to invoke
various restrictions on redemptions including, without limitation, restricting
redemptions to a limited percentage of the aggregate net asset value of such
underlying hedge funds, the temporary suspension of redemptions altogether, or
the commencement of a controlled liquidation and wind-up of the underlying
hedge fund's business.
    Following the cash distribution of $3.14 per unit paid from the Trust on
July 29th, 2009, approximately 72% of the Trust's post-distribution assets
continued to have exposure to underlying hedge fund market movements as of
July 31, 2009. Based on the information that the Manager had available to it
as of July 31, 2009, the Manager anticipates that approximately 65% of the
Trust may be subject to restrictions on liquidity that could extend beyond the
Termination Date. In an effort to distribute the proceeds to unitholders as
soon as practicable, the Manager is actively seeking alternative means of
affecting the monetization of the underlying hedge fund portfolio. The Manager
will provide further information to unitholders, if and when such details
become available.

    Units of the Northwater Market-Neutral Trust are listed on The Toronto
Stock Exchange under the symbol NMN.UN.

For further information:

For further information: Mohamed Khaki at Northwater Capital Management
Inc. at (416) 360-5435

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Northwater Market-Neutral Trust

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