Guardian Group of Funds Ltd.

Headnote

Representatives of mutual fund dealer exempted from the prohibition against payment ofcommission/fee rebates to clients who switch investments from one mutual fund to anothermutual fund related to the dealer, subject to specified conditions.

Rules Cited

National Instrument 81-105 Mutual Fund Sales Practices, ss. 4.2(1), ss. 7.1(1)(a) & (b),9.1(1) and Part 8.

WHEREAS the Canadian securities regulatory authority or regulator (the "DecisionMaker") in each of the provinces and territories of British Columbia, Alberta,Saskatchewan, Manitoba, Ontario, New Brunswick, Nova Scotia, Prince Edward Island,Newfoundland, Northwest Territories, Yukon Territory and Nunavut (the "Jurisdictions")has received an application (the "Application") from Guardian Group of Funds Ltd.("Guardian") on its own behalf and on behalf of its Affiliated Dealers (hereinafter defined)and their respective sales representatives from time to time for a decision pursuant tosection 9.1 of National Instrument 81-105 Mutual Fund Sales Practices ("NI 81-105") thatthe prohibition contained in clause 7.1(1)(b) of NI 81-105 against certain rebates ofredemption commissions or fees ("Rebate" or "Rebates") shall not apply to Rebates paidby representatives of Affiliated Dealers (the "Representatives") to clients who switch theirinvestments from third party mutual funds to mutual funds managed by Guardian.

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 it has been represented by Guardian to the Decision Makers that:

1. Guardian is a subsidiary of Guardian Capital Group Limited ("GCG").

2. As of the date hereof, GCG indirectly owns 81% of the shares of CMG-WorldsourceFinancial Services Inc. ("CMG"), a national mutual fund dealer (such dealer,together with any dealers that subsequently may become affiliates of Guardianbeing herein referred to as collectively the "Affiliated Dealers" and individually asan "Affiliated Dealer").

3. GCG and CMG are affiliates of Guardian and are therefore "members of theorganization" of the Guardian Funds (as hereinafter defined) pursuant to NI 81-105.

4. Guardian manages various mutual funds which as of the date hereof consist of themutual funds listed in Schedule "A" hereto.

5. The Affiliated Dealers may distribute, as participating dealers, the Guardian Fundsas well as other unrelated mutual funds (the "Third Party Funds").

6. No Representative owns more than 10% of the outstanding voting or equitysecurities of CGC and no Representative owns any of the outstanding voting orequity securities of Guardian or an Affiliated Dealer.

7. This relief is being applied for in order to permit Rebates to be paid byRepresentatives to clients who are switching from Third Party Funds to GuardianFunds.

8. The decision to provide Rebates will be made by the Representatives based on thebest interests of the client.

9. Representatives are not required by Guardian or any of its affiliates to sell GuardianFunds to clients and accordingly have no quotas in respect of selling GuardianFunds and are not provided with incentives by Guardian (other than as permittedby NI 81-105) or any of its affiliates to sell Guardian Funds.

AND WHEREAS pursuant to the System this MRRS Decision Document evidencesthe decision of each Decision Maker (collectively, the "Decision");

AND WHEREAS each of the Decision Makers is satisfied that the test contained inNI 81-105 that provides the Decision Maker with the jurisdiction to make the Decision hasbeen met;

THE DECISION of the Decision Makers pursuant to section 9.1 of NI 81-105 is thatRepresentatives are exempt from the prohibitions on payment of Rebates contained inclause 7.1(1)(b) of NI 81-105 to the extent necessary to allow Representatives to payRebates to clients upon redemption of Third Party Funds when clients wish to switch fromThird Party Funds to Guardian Funds.

PROVIDED in respect of each such payment that:

1. Guardian, the relevant Affiliated Dealer and the relevant Representative, as thecase may be, complies with the informed written consent provisions of clause7.1(1)(a) and the disclosure and consent provisions of Part 8 of NI 81-105 exceptto the extent that Guardian obtains or has obtained permission from the CanadianSecurities Administrators to deviate from such requirements;

2. each Representative will advise each client in advance that any Rebate proposedto be made available by a Representative in connection with the purchase ofsecurities of Guardian Funds (i) will be available to the client regardless of whetherthe client invests in a Guardian Fund or a Third Party Fund; (ii) the amount of thepayment may be only to a maximum of the commission earned by theRepresentative on the purchase; and (iii) Rebates will not be conditional on apurchase of securities of a Guardian Fund;

3. neither Guardian nor Affiliated Dealers provided an incentive (either express orimplied) to any Representative to recommend a Guardian Fund over a Third PartyFund, other than as permitted by NI 81-105

4. neither Guardian nor any of its affiliates provided a monetary or non-monetarybenefit other than as permitted by NI 81-105;

5. Representatives are expressly permitted to sell other mutual funds without influencefrom Guardian or any affiliate, and other representatives are and will in the futurebe able to offer third party products without influence from Guardian or any affiliate;

6. the amount of the Rebate is determined by the Representative and the client;

7. each Representative that provides Rebates will not be reimbursed directly orindirectly for such payment by Guardian or any affiliate other than throughcommissions (including trailing commissions) earned by the Representative on thepurchase of the Guardian Fund;

8. Representatives are not and shall not in the future be subject to quotas (eitherexpress or implied) in respect of the distribution of Guardian Funds and shallcontinue to be entitled to sell Third Party Funds to their clients; and

9. a Representative who makes a Rebate is employed by or on contract with anAffiliated Dealer of Guardian that is registered in the jurisdiction in which theRebate is paid.

AND PROVIDED FURTHER that this Decision shall cease to be operative withrespect to a Decision Maker following the entry into force of a rule of that Decision Makerwhich replaces or amends section 7.1 of NI 81-105.

September 29th, 2000.

"J. A. Geller"       "Robert W. Davis"

GUARDIAN MUTUAL FUNDS

GUARDIAN AMERICAN EQUITY FUND

GUARDIAN AMERICAN LARGE CAP FUND

GUARDIAN CANADIAN BALANCED FUND

GUARDIAN CANADIAN BOND FUND

GUARDIAN CANADIAN EQUITY VALUE FUND

GUARDIAN CANADIAN HIGH YIELD BOND FUND

GUARDIAN CANADIAN INCOME FUND

GUARDIAN CANADIAN LARGE CAP FUND

GUARDIAN CANADIAN MONEY MARKET FUND

GUARDIAN EMERGING MARKETS FUND

GUARDIAN ENTERPRISE FUND

GUARDIAN EUROPEAN EQUITY FUND

GUARDIAN GLOBAL EQUITY FUND

GUARDIAN GLOBAL SMALL CAP FUND

GUARDIAN GLOBAL TECHNOLOGY FUND

GUARDIAN GROWTH & INCOME FUND

GUARDIAN GROWTH EQUITY FUND

GUARDIAN MONTHLY DIVIDEND FUND

GUARDIAN MONTHLY HIGH INCOME FUND

GUARDIAN RSP AMERICAN EQUITY FUND

GUARDIAN RSP FOREIGN INCOME FUND

GUARDIAN RSP GLOBAL EQUITY FUND

GUARDIAN RSP GLOBAL TECHNOLOGY FUND

GUARDIAN RSP INTERNATIONAL BALANCED FUND

GUARDIAN RSP INTERNATIONAL INCOME FUND

GUARDIAN RSP U.S. MONEY MARKET FUND

ALEXANDRIA GROWTH FUNDS

ALEXANDRIA CANADIAN BALANCED FUND

ALEXANDRIA CANADIAN EQUITY GROWTH FUND

ALEXANDRIA GLOBAL EQUITY FUND

(such funds, any amendments to such funds and any new mutual funds as may bemanaged by Guardian are herein referred to as the "Guardian Funds").