FMD Services Limited Partnership

Headnote

National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- exemptions from registration requirement and prospectus requirement for distribution of limited partnership interests by limited partnership set up by professional services firm for tax planning purposes. Limited partnership interests to be issued to partners of professional services firm, their spouses and family trusts and family corporations. Relief granted subject to certain conditions, including resale restrictions and that investors receive a copy of decision document and acknowledge that protections of securities legislation will not be available.

Applicable Legislative Provisions

Securities Act, R.S.O. 1990, c. S.5, as am., ss. 25, 53, 74(1).

December 2, 2008

IN THE MATTER OF

THE SECURITIES LEGISLATION OF

ONTARIO

(the "Jurisdiction")

AND

IN THE MATTER OF

THE PROCESS FOR EXEMPTIVE RELIEF

APPLICATIONS IN MULTIPLE JURISDICTIONS

AND

IN THE MATTER OF

FMD SERVICES LIMITED PARTNERSHIP

(the "Filer")

DECISION

Background

The principal regulator in the Jurisdiction has received an application from the Filer for a decision under the securities legislation of the Jurisdiction of the principal regulator (the "Legislation") that the proposed distribution of limited partnership interests in the Filer ("LP Interests") to Regional SLP Participants (as defined below) in connection with the reorganization transaction described herein and to Eligible Subscribers (as defined below) from time to time will not be subject to the registration requirement and the prospectus requirement (each as defined in National Instrument 14-101) contained in the Legislation (the "Exemption Sought").

Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):

(a) the Ontario Securities Commission is the principal regulator for this application; and

(b) the Filer has provided notice that section 4.7(1) of Multilateral Instrument 11-102 Passport System ("MI 11-102") is intended to be relied upon in the provinces of British Columbia, Alberta and Québec.

Interpretation

Terms defined in National Instrument 14-101 Definitions have the same meaning if used in this decision, unless otherwise defined.

Representations

This decision is based on the following facts represented by the Filer:

1. The Filer is a limited partnership formed under the laws of Ontario on December 31, 1998. The general partner of the Filer is FMD National Inc., formerly FMD Ontario Inc. (the "General Partner"), a corporation incorporated under the laws of Ontario. The principal office of both the Filer and of the General Partner is in Ontario.

2. The Filer is not at present, and does not intend to become, a reporting issuer or the equivalent in any jurisdiction. The Filer is not in default of securities legislation in any jurisdiction.

3. The Filer has to date provided, or arranged for the provision of, certain management, administrative, financial, personnel, technology, marketing and other support services and office facilities to the Ontario offices of Fasken Martineau DuMoulin LLP ("FMD"), an Ontario limited liability partnership which carries on the practice of law in Ontario and the provinces of British Columbia, Alberta and Québec and which currently has 399 partners.

4. The limited partners of the Filer are FMD Partners (as defined below) who are now or were formerly located in the Ontario offices of FMD and Eligible Subscribers (as defined below) related to such FMD Partners.

5. Two separate limited partnerships (the "Regional SLPs") have provided, or arranged for the provision of, comparable services and facilities to the offices of FMD located in Vancouver and Calgary and in Montreal and Québec City. The limited partnership interests in the Regional SLPs are held either directly by, or indirectly through a trust for the benefit of, the FMD Partners located in those offices, their spouses and family trusts (the "Regional SLP Participants"). In addition to Eligible Beneficiaries defined in paragraphs 8(a) to 8(g) below, the beneficiaries of approximately ten Regional SLP Participants that are trusts (the "Subject Trusts") include (i) certain other relatives and close personal friends, including their issue, of the applicable FMD Partner or the FMD Partner's spouse, (ii) charitable entities, (iii) corporations, all of the shareholders of which are any one or more of the Subject Trust's beneficiaries, and (iv) trusts, the beneficiaries of which are any one or more of the Subject Trust's beneficiaries (collectively, "Grandfathered Beneficiaries").

6. The affairs of the Filer and of the Regional SLPs are being reorganized. The reorganization will result in the dissolution of the Regional SLPs and transfer of their assets and liabilities to the Filer, the issuance of LP Interests in the Filer to the Regional SLP Participants and the Filer providing, or arranging for the provision of, services and facilities of the nature described in paragraph 3 above to all Canadian offices of FMD.

7. Following completion of the reorganization, LP Interests in the Filer may be issued from time to time to the following (each an "Eligible Subscriber"):

(a) an individual who is a partner of FMD or is the shareholder of a professional corporation that is a partner of FMD (an "FMD Partner");

(b) the spouse of an FMD Partner;

(c) a trust having the attributes described in paragraph 8 below (a "Family Trust"); and

(d) corporations, all of the issued and outstanding shares of which are owned by persons who would be Eligible Beneficiaries of a Family Trust and of which an FMD Partner is a director and officer (each a "Family Corporation").

8. Each Family Trust will be a discretionary trust, the beneficiaries of which will be one or more of the following (collectively "Eligible Beneficiaries"):

(a) an FMD Partner;

(b) the spouse of such FMD Partner;

(c) the issue of such FMD Partner or of the spouse of such FMD Partner or the spouse of any such issue;

(d) parents of such FMD Partner or of the spouse of such FMD Partner;

(e) grandparents of such FMD Partner or of the spouse of such FMD Partner;

(f) nieces, nephews or siblings of such FMD Partner or of the spouse of such FMD Partner;

(g) a trust the beneficiaries of which are any one or more of the foregoing; and

(h) in the case of Regional SLP Participants, Grandfathered Beneficiaries.

9. LP Interests in the Filer are not transferable or assignable except with the consent of the General Partner, which consent will only be given for a transfer or assignment:

(a) between an FMD Partner and an Eligible Subscriber related to such FMD Partner or between Eligible Subscribers related to the same FMD Partner;

(b) to a financial institution as security for indebtedness incurred for the purpose of financing the acquisition of an LP Interest or capital contributions made in respect thereof; or

(c) to the Filer for cancellation.

10. The LP Interest held by a limited partner will be redeemed and a limited partner's capital contribution to the Filer repaid: (i) within one year after the limited partner ceases to qualify as an Eligible Subscriber; or (ii) if the limited partner purports to transfer the LP Interest held by it contrary to the above restrictions; or (iii) if the General Partner, in its sole discretion, so requires.

11. Within 140 days after the end of each fiscal year of the Filer, the Filer will provide to each limited partner of the Filer, a copy of the financial statements of the Filer for such fiscal year.

12. Before issuing an LP Interest to an Eligible Subscriber that is a Family Trust or a Family Corporation, the Filer will obtain a written acknowledgement from the Eligible Subscriber to the effect that:

(a) if the Eligible Subscriber is a Family Trust, no beneficiary of the Family Trust, other than the relevant FMD Partner and his or her spouse, will directly or indirectly contribute or agree to contribute money or other assets to such Family Trust to fund its investment in the Filer or be liable for any loan or other form of financing obtained by the Family Trust for such purpose and no beneficiary of the Family Trust, other than the relevant FMD Partner and any other beneficiary who is a trustee, will be involved in the making of any investment decision of such Family Trust; or

(b) if the Eligible Subscriber is a Family Corporation, no shareholder of the Family Corporation, other than the relevant FMD Partner and his or her spouse, will directly or indirectly contribute or agree to contribute money or other assets to such Family Corporation to fund its investment in the Filer or be liable for any loan or other form of financing obtained by the Family Corporation for such purpose and no shareholder of the Family Corporation, other than the relevant FMD Partner and any other shareholder who is a director, will be involved in the making of any investment decision of such Family Corporation.

13. Before issuing an LP Interest to a Regional SLP Participant that is a trust in connection with the reorganization transaction, the Filer will obtain a written acknowledgement from the trust to the effect that no beneficiary of the trust, other than the relevant FMD Partner and his or her spouse, will directly or indirectly contribute or agree to contribute money or other assets to such trust to fund its investment in the Filer or be liable for any loan or other form of financing obtained by the trust for such purpose and no beneficiary of the trust, other than the relevant FMD Partner and any other beneficiary who is a trustee, will be involved in the making of any investment decision of such trust.

14. FMD Partners will not be induced to purchase LP Interests by expectation of being made or continuing as a partner of FMD and other Eligible Subscribers will not be indirectly induced to purchase LP Interests by expectation of the relevant FMD Partner being made or continuing as partner of FMD.

15. A Regional SLP Participant that is an FMD Partner will not be induced to agree to receive LP Interests in connection with the reorganization transaction by expectation of continuing as a partner of FMD and other Regional SLP Participants will not be indirectly induced to agree to receive LP Interests in connection with the reorganization transaction by expectation of the relevant FMD Partner continuing as partner of FMD.

Decision

The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.

The decision of the principal regulator under the Legislation is that the Exemption Sought is granted provided that:

1. before issuing an LP Interest to a Regional SLP Participant or Eligible Subscriber, the Filer obtains a written acknowledgement from the Regional SLP Participant or Eligible Subscriber that the Regional SLP Participant or Eligible Subscriber has received a copy of this decision document and that the protections of applicable Legislation, including statutory rights of rescission and damages and the right to receive continuous disclosure, will not be available in respect of the LP Interests; and

2. any subsequent trade in LP Interests shall be a distribution or primary distribution to the public under the Legislation of the jurisdiction in which the trade takes place unless such subsequent trade is:

(a) between an FMD Partner and an Eligible Subscriber related to such FMD Partner or between Eligible Subscribers related to the same FMD Partner;

(b) to a financial institution as security for indebtedness incurred for the purpose of financing the acquisition of an LP Interest or capital contributions made in respect thereof; or

(c) to the Filer for cancellation.