Securities Law & Instruments

Headnote

Mutual Reliance Review System for Exemptive Relief Applications - Waiver grantedpursuant to section 4.5 of National Policy Statement No. 47 to enable issuer toparticipate in the POP System and the Shelf System (as contemplated in NationalPolicy Statement No. 44 to distribute asset- backed securities.

Issuer is a connected and related issuer of lead underwriter- independentunderwriter will underwrite at least 20% of the offering - lead underwriter exemptfrom the independent underwriter requirement, subject to certain conditions.

Ontario Regulations Cited

Regulation made under the Securities Act, R.R.O. 1990, Reg. 1015, as am., ss.224(1)(b) and 233.

Policies Cited

National Policy Statement No. 47 - Prompt Offering Qualification System.

National Policy Statement No. 44 - Rules for Shelf Prospectus Offerings and forPricing Offerings After the Final Prospectus is Receipted.

Proposed National Instrument 44-101- Short Form Prospectus Distributions (1999),22 OSCB (POP Supp 2).

Proposed National Instrument 44-102 - Shelf Distribution (1998), 21 OSCB 6206.

IN THE MATTER OF THE SECURITIES LEGISLATION OFONTARIO, BRITISH COLUMBIA, ALBERTA, MANITOBA, SASKATCHEWAN, QUÉBEC,NEW BRUNSWICK, NOVA SCOTIA, NEWFOUNDLAND AND PRINCE EDWARD ISLAND

AND

IN THE MATTER OF
THE MUTUAL RELIANCE REVIEW SYSTEM FOR EXEMPTIVE RELIEF APPLICATIONS

AND

IN THE MATTER OF
SOLAR TRUST / FIDUCIE SOLAR

AND

IN THE MATTER OF
TD SECURITIES INC.

MRRS DECISION DOCUMENT


WHEREAS the Canadian securities regulatory authority or regulator (the"Decision Maker") in each of Ontario, British Columbia, Alberta, Saskatchewan,Manitoba, Québec, New Brunswick, Nova Scotia, Prince Edward Island, andNewfoundland (the "Jurisdictions") has received an application from SolarTrust/Fiducie Solar (the "Issuer") and TD Securities Inc. ("TDSI") (the Issuer and TDSIare collectively referred to herein as the "Filers") for a decision pursuant to thesecurities legislation and policies of the Jurisdictions (collectively, the "Legislation")that:

(a) pursuant to section 4.5 of Canadian Securities Administrators' NationalPolicy Statement No. 47 ("NP 47") and the applicable securitieslegislation of Québec, including but not limited to, those set forth in TitleII and Title III of the Securities Act and Regulation (Québec), the Issueris permitted to participate in the Prompt Offering Qualification System(the "POP System") solely for the purpose of distributing Asset BackedSecurities (as defined below) with an Approved Rating (as defined in NP47) from time to time; and

(b) the restrictions contained in the Legislation concerning registrants actingas underwriters in connection with the distribution of securities of relatedor connected issuers will not apply to TDSI in respect of the proposeddistributions of Asset-Backed Securities of the Issuer;

AND WHEREAS pursuant to the Mutual Reliance Review System for ExemptiveRelief Applications (the "System"), the Ontario Securities Commission is the principalregulator for this application;

AND WHEREAS the Filers have represented to the Decision Makers that:

1. the Issuer is a private, special purpose trust which was organized pursuant toa declaration of trust under the laws of Ontario dated July 5, 2000; the Issuer'strustee is CIBC Mellon Trust Company; the only security holders of the Issuerwill be the holders of its Asset-Backed Securities;

2. TDSI is a corporation incorporated under the Business Corporations Act(Ontario) and is a wholly owned subsidiary of The Toronto-Dominion Bank("TD");

3. TDSI is not a reporting issuer in any Jurisdiction;

4. TDSI is registered as a dealer in the categories of "broker" and "investmentdealer" and is a member of the Investment Dealers Association of Canada;

5. the Issuer proposes to offer under the POP System or the shelf system (the"Shelf System"), as contemplated in National Policy Statement No. 44 ("NP 44")and the applicable securities legislation in Québec, including but not limited to,those set forth in Title II and Title III of the Securities Act and Regulation(Québec),from time to time (the"Offerings"), securities that are primarily servicedby the cash flows of discrete pools of mortgage loan receivables or otherfinancial assets, either fixed or revolving, that by their terms convert into cashwithin a finite time period, and any rights or other assets designed to assure theservicing or timely distribution of proceeds to security holders ("Asset-BackedSecurities"), including commercial mortgage - backed pass-through certificatesissuable in series and classes ("Pass-Through Certificates"), with an ApprovedRating by an Approved Rating Organization under the POP System or ShelfSystem, from time to time to the public in Canada (the "Offerings"), to financethe purchase by the Issuer from Commercial Mortgage Origination Company ofCanada Inc. ("CMO"), Commercial Mortgage Origination Trust ("CMOT"), TheToronto-Dominion Bank ("TD"), Canada Trustco Mortgage Company ("CTMC")and from other originators of discrete pools of mortgage loan receivables orother financial assets ("Securitized Assets") or ownership interests in pools ofSecuritized Assets (CMO, CMOT, TD, CTMC and such other originators arecollectively referred to herein as the "Sellers"); each Asset-Backed Security ofa particular series and class will represent the right to receive payment ofprincipal and interest thereon to be funded from a particular pool of SecuritizedAssets;

6. the Issuer currently has no assets or liabilities and does not carry on anyactivities;

7. as a special purpose trust, the Issuer will not carry on any activities other thanpurchasing the Securitized Assets and issuing Asset-Backed Securities,including Pass-Through Certificates;

8. each Asset-Backed Security of a particular series and class will

(a) represent an undivided co-ownership interest in a pool of SecuritizedAssets, or

(b) be secured by a charge over the Issuer's ownership interest in a pool ofSecuritized Assets;

9. the proceeds of each proposed Offering will be used by the Issuer to pay theapplicable Sellers for the purchase of pools of Securitized Assets or ownershipinterests therein;

10. the Issuer would not be eligible to participate in the POP System or the ShelfSystem without this decision because it does not satisfy the reporting issuereligibility criteria and public float eligibility criteria set forth in NP 47;

11. in connection with each proposed Offering by the Issuer

(a) the Issuer will have a current annual information form ("AIF"),

(b) the Asset-Backed Securities to be distributed

(i) will have received an Approved Rating on a provisional basis,

(ii) will not have been the subject of an announcement by anApproved Rating Organization (as defined in NP 47) of which theIssuer is or ought reasonably to be aware that the ApprovedRating given by the Approved Rating Organization may be down-graded to a rating category that would not be an Approved Rating,and

(ii) will not have received a provisional or final rating lower than anApproved Rating from any Approved Rating Organization, and

(c) if the Issuer files a preliminary Short Form Prospectus (as defined below)more than 90 days after the end of its most recently completed financialyear, the Issuer will have filed financial statements for that year;

12. each AIF of the Issuer will be prepared in accordance with Appendix A of NP 47,with the following additional information

(a) the disclosure in AIFs filed by the Issuer shall reflect the special natureof its business; and

(b) if the Issuer has Asset-Backed Securities outstanding, the AIF willdisclose on a pool by pool basis

(i) a description of any events, covenants, standards orpreconditions that are dependant or based on the economicperformance of the underlying pool of financial assets and thatmay impact on the timing or amount of payments or distributionsto be made under the Asset-Backed Securities,

(ii) for the past two completed financial years of the Issuer or suchlesser period commencing on the first date on which the Issuerhad Asset-Backed Securities outstanding, information on theunderlying pool of financial assets relating to

(A) the composition of the pool as of the end of the financialyear or partial period,

(B) income and losses from the pool on at least a quarterlybasis,

(C) the payment, prepayment and collection experience of thepool on a quarterly basis, and

(D) any significant variances experienced in the mattersreferred to in subclauses (A), (B) and (C),

(iii) if any of the information disclosed under clause (ii) of thisparagraph 12 has been audited, the existence and results of theaudit,

(iv) the investment parameters applicable to investments of any cashflow surpluses,

(v) the amount of payments made in respect of principal and interestor capital and yield, each stated separately, on Asset-BackedSecurities of the Issuer outstanding during the most recentlycompleted financial year or a lesser period commencing on thefirst day on which the Issuer had Asset-Backed Securitiesoutstanding,

(vi) the occurrence of any events that have led or with the passage oftime could lead to the accelerated payment of principal or capitalof Asset-Backed Securities, and

(vii) the identity of any principal obligors for the outstanding Asset-Backed Securities of the Issuer at the end of the most recentfinancial year or interim period, the percentage of the underlyingpool of financial assets represented by obligations of eachprincipal obligor and whether the principal obligor, if any, has filedan AIF in any jurisdiction or a Form 10-K or Form 20-F in theUnited States;

13. the preliminary short form prospectus ("preliminary Short Form Prospectus"), thepreliminary short form base shelf prospectus ("preliminary Shelf Prospectus"),the final short form prospectus ("final Short Form Prospectus") and the finalshort form base shelf prospectus("final Shelf Prospectus") of the Issuer will beprepared in accordance with Appendix B of NP 47 and Schedule IV to theregulation made under the Securities Act (Québec), with such amendments inconnection with the Shelf System as are specified in subsection 2.3(b), Section3 and Appendix B of NP 44 and Section III.1 of Division III of Chapter 1 of TitleII to the regulation under the Securities Act (Québec), and with the followingadditional information

(a) the disclosure in a preliminary Shelf or Short Form Prospectus and a finalShelf or Short Form Prospectus filed by the Issuer shall reflect thespecial nature of its business,

(b) a preliminary Shelf or Short Form Prospectus and a final Shelf or ShortForm Prospectus filed by the Issuer will describe or set out

(i) the material attributes and characteristics of the Asset-BackedSecurities to be offered, including details on

(A) the rate of interest or stipulated yield and any premium,

(B) the date for repayment of principal or return of capital andany circumstances in which payments of principal or capitalmay be made before such date, including any redemptionor pre-payment obligations or privileges of the Issuer andany events that may trigger early liquidation or amortizationof the underlying pool of financial assets,

(C) provisions for the accumulation of cash flows to provide forthe repayment of principal or return of capital,

(D) provisions permitting or restricting the issuance ofadditional securities and any other material negativecovenants applicable to the Issuer,

(E) the nature, order and priority of the entitlements of holdersof Asset-Backed Securities and any other entitled personsor companies to receive cash flows generated from theunderlying pool of financial assets, and

(F) any events, covenants, standards or preconditions that aredependant or based on the economic performance of theunderlying pool of financial assets and that may impact onthe timing or amount of payments or distributions to bemade under the Asset-Backed Securities,

(ii) information on the underlying pool of financial assets for theperiod from the date as at which the following information waspresented in the Issuer's current AIF to a date not more than 90days before the date of the issuance of a receipt for thepreliminary Shelf or Short Form Prospectus, as the case may be,relating to

(A) the composition of the pool as of the end of the period,

(B) income and losses from the pool for the period, on at leasta quarterly basis, and

(C) the payment, prepayment and collection experience of thepool for the period, on at least a quarterly basis,

(iii) the type or types of the financial assets, the manner in which thefinancial assets originated or will originate and, if applicable, themechanism and terms of the agreement governing the transfer ofthe financial assets comprising the underlying pool to or throughthe Issuer, including the consideration paid for the financialassets,

(iv) any person or company (including its general business activitiesand its material responsibilities under the Asset-BackedSecurities) who

(A) originates, sells or deposits a material portion of thefinancial assets comprising the pool, or has agreed to doso,

(B) acts, or has agreed to act, as a trustee, custodian, baileeor agent of the Issuer or any holder of the Asset-BackedSecurities, or in a similar capacity,

(C) administers or services a material portion of the financialassets comprising the pool or provides administrative ormanagerial services to the Issuer, or has agreed to do so,on a conditional basis or otherwise, if (1) finding areplacement provider of the services at a cost comparableto the cost of the current provider is not reasonably likely,(2) a replacement provider of the services is likely toachieve materially worse results than the current provider,(3) the current provider of the services is likely to default inits service obligations because of its current financialcondition, or (4) the disclosure is otherwise material,

(D) provides a guarantee, alternative credit support or othercredit enhancement to support the obligations of the Issuerunder the Asset-Backed Securities or the performance ofsome or all of the financial assets in the pool, or hasagreed to do so, or

(E) lends to the Issuer in order to facilitate the timely paymentor repayment of amounts payable under the Asset-BackedSecurities, or has agreed to do so,

(v) the terms of any material relationships between (A) the personsor companies referred to in subparagraph (iv) of this paragraph 13and any of their respective affiliates, and (B) the Issuer and anyof its affiliates,

(vi) any provisions relating to termination of services orresponsibilities of any of the persons or companies referred to insubparagraph (iv) of this paragraph 13 and the terms on which areplacement may be appointed, and

(vii) any risk factors associated with the Asset-Backed Securities,including disclosure of material risks associated with changes ininterest rates or prepayment levels, and any circumstances wherepayments on the Asset-Backed Securities could be impaired ordisrupted as a result of any reasonably foreseeable event thatmay delay, divert or disrupt the cash flows dedicated to servicethe Asset-Backed Securities,

provided that if any of the foregoing information will be disclosed in afinal Prospectus Supplement (as defined below), it may be omitted fromthe corresponding Shelf Prospectus,

(c) the final Shelf Prospectus will contain a statement that the Issuerundertakes that it will not distribute Asset-Based Securities of a type thatat the time of distribution have not previously been distributed byprospectus in the Jurisdiction ("Novel Asset-Backed Securities") withoutpre-clearing with the Decision Makers the disclosure to be contained inany Prospectus Supplement pertaining to the distribution of such NovelAsset-Based Securities, and

(d) the preliminary Shelf or Short Form Prospectus, as the case may be, andfinal Shelf or Short Form Prospectus, as the case may be, will discloseany factors or considerations identified by the Approved RatingOrganization as giving rise to unusual risks associated with the securitiesto be distributed;

14. Shelf Prospectus supplements (each a "Prospectus Supplement") will beprepared in accordance with subsection 3.4(a) of NP 44, and will include all ofthe shelf information pertaining to the distribution of Asset-Backed Securitieswhich was omitted from the final Shelf Prospectus;

15. TDSI proposes to act as the underwriter for 50 to 80 percent of the dollar valueof the distribution for each proposed Offering of Asset-Backed Securities by theIssuer;

16. the only financial benefits which TDSI will receive as a result of each proposedOffering are

(a) normal arm's length underwriting commission and reimbursement ofexpenses associated with a public offering in Canada, and

(b) nominal fees in its capacity as sub-administrative agent for the Issuerpursuant to a sub-administration agreement to be entered into betweenTDSI and TD;

17. TD is taking the initiative in organizing the business of the Issuer in connectionwith the proposed Offerings and as such TD may be considered to be a"promoter" of the Issuer within the meaning of securities legislation of certainJurisdictions;

18. TD entered into an administrative services agreement dated July 5, 2000 withthe Issuer under which TD has agreed to provide all administrative servicesrelating to the operation of the Issuer, for which TD will receive a nominaladministrative fee;

19. the Issuer's costs and expenses related to the issuance of the Pass-ThoroughCertificates as well as its ongoing operating expenses will be funded either

(a) through a fee which will be payable from the collections on the pools ofSecuritized Assets, or

(b) by TD;

20. the Issuer may be considered to be a related issuer and connected issuer (asdefined in the Legislation) of TDSI for the purposes of the proposed Offeringsbecause

(a) TDSI is a subsidiary of TD,

(b) TD is a promoter of the Issuer,

(c) TD will administer the on-going operations of the Issuer pursuant to anadministrative services agreement, and

(d) TDSI will administer the on-going operations of the Issuer pursuant to asub-administration agreement;

21. in connection with the proposed distribution by TDSI of Asset-Backed Securitiesof the Issuer for each proposed Offering

(a) each preliminary Shelf or Short Form Prospectus, final Shelf or ShortForm Prospectus and Prospectus Supplement of the Issuer shall containthe following information,

(i) on the front page of each such document,

(A) a statement, naming TDSI, in bold type which states thatthe Issuer is a related and connected issuer of TDSI inconnection with the distribution,

(B) a summary, naming TDSI, stating that the Issuer is arelated and connected issuer of TDSI based on, amongother things, the common links between the Issuer, TDSIand TD, and

(C) a cross-reference to the applicable section in the body ofthe document where further information concerning therelationship between the Issuer and TDSI is provided, and

(ii) in the body of each such document,

(A) a statement, naming TDSI, that the Issuer is a related andconnected issuer of TDSI in connection with thedistribution,

(B) the basis on which the Issuer is a related and connectedissuer to TDSI, including details of the common linksbetween TD, TDSI and the Issuer, and other aspects of therelationship between TDSI and the Issuer,

(C) disclosure regarding the involvement of TDSI and of TD inthe decision to distribute the Asset-Backed Securitiesbeing offered and the determination of the terms of thedistribution, and

(D) details of the financial benefits which TDSI will receivefrom the proposed Offerings,

(b) an independent underwriter shall underwrite no less than 20 percent ofthe dollar value of the distribution for an Offering, participate in thestructuring and pricing of the distribution of such Offering and in the duediligence activities performed by the underwriters for the distribution, andsign the prospectus certificate required by the Legislation, and

(c) each such document shall identify the independent underwriter anddisclose the role of the independent underwriter in the structuring andpricing of the distribution of the applicable Offering and in the duediligence activities performed by the underwriters for the distribution.

AND WHEREAS pursuant to the MRRS this Decision Document evidences thedecision of each Decision Maker (collectively, the "Decision");

AND WHEREAS each of the Decision Makers is satisfied that the test containedin the Legislation that provides the Decision Maker with the jurisdiction to make theDecision has been met;

THE DECISION of the Decision Makers pursuant to the Legislation is that therequirements contained in the Legislation shall be waived solely to permit the Issuerto participate in the POP System to distribute Asset-Backed Securities with anApproved Rating from time to time, provided that:

A. the Issuer complies with paragraphs 11, 12, 13 and 14 hereof;

B. except as otherwise provided herein, the Issuer complies with all of the filingrequirements and procedures set out in the Legislation governing the POPSystem and the Shelf System;

C. the Issuer files an undertaking before or concurrently with its preliminary ShelfProspectus, if utilized, which states that:

(a) the Issuer will not distribute under the final Shelf Prospectus NovelAsset-Backed Securities without pre-clearing the disclosure pertainingto the distribution of such Novel Asset-Backed Securities in anyProspectus Supplement with the applicable Decision Makers; and

(b) the Issuer will not distribute such Novel Asset-Backed Securities unless:

(i) the draft Prospectus Supplements pertaining to the distribution ofsuch Novel Asset-Backed Securities have been delivered to theDecision Makers in substantially final form; and

(ii) either:

(A) the Decision Makers have confirmed their acceptance ofeach draft Prospectus Supplement in substantially finalform or in final form; or

(B) 21 days has elapsed since the date of delivery of eachdraft Prospectus Supplement in substantially final form tothe Decision Makers and the Decision Makers have notprovided written comments on the draft ProspectusSupplement;

D. the Issuer files with each preliminary Short Form or Shelf Prospectus aqualification certificate executed on behalf of the Issuer by an officer of itsadministrative agent, certifying that the Issuer satisfies the eligibility criteria setout in paragraph 11 hereof, and which makes reference to this Decision; and

E. this Decision will automatically expire upon the latter of proposed NationalInstrument 44-101 and proposed National Instrument 44-102 coming into forceand being adopted as a rule in each of the Jurisdictions.

DATED at Toronto, this 1st day of September, 2000.

"Iva Vranic"

THE FURTHER DECISION of the Decision Makers pursuant to the Legislationis that the restrictions contained in the Legislation concerning registrants acting asunderwriters in connection with the distribution of securities of related or connectedissuers will not apply to TDSI in respect of the proposed Offerings provided that thesuch Offerings are completed in compliance with the requirements contained inparagraph 21 herein.

September 1st, 2000.

"J. A. Geller"      "J. F. Howard"