Securities Law & Instruments

Headnote

Investmentof virtually all assets of a mutual fund (excluding cash and cashequivalents held to meet redemptions and to pay management fees)in a specified third party managed mutual fund to implement a"passive" fund-of-fund structure. Exempted from the self-dealingand reporting requirements of subsections 111(2)(b), 111(3), 117(1)(a)and 117(1)(d) subject to certain specified conditions.

StatutesCited

SecuritiesAct (Ontario), R.S.O. 1990 c.S.5, as am. Ss. 111(2)(b), 111(3),117(1)(a), 117(1)(d), 117(2).


INTHE MATTER OF

THESECURITIES LEGISLATION OF

ALBERTA,BRITISH COLUMBIA, NEWFOUNDLAND & LABRADOR,

NOVASCOTIA, ONTARIO AND SASKATCHEWAN

AND

INTHE MATTER OF

THEMUTUAL RELIANCE REVIEW SYSTEM

FOREXEMPTIVE RELIEF APPLICATIONS

AND

INTHE MATTER OF

PFSLINVESTMENTS CANADA LTD.

AND

PRIMERICACANADIAN MONEY MARKET PORTFOLIO FUND

MRRSDECISION DOCUMENT

WHEREAS the local securities regulatory authority orregulator (the "Decision Maker") in each of the provinces ofBritish Columbia, Alberta, Saskatchewan, Ontario, Newfoundland& Labrador and Nova Scotia (the "Jurisdictions") has receivedan application (the "Application") from PFSL Investments CanadaLtd. ("PFSL") and Primerica Canadian Money Market PortfolioFund (the "Top Fund") for a decision by each Decision Maker(collectively, the "Decision") pursuant to the securities legislationof the Jurisdictions (the "Legislation") that the followingrequirements and restrictions contained in the Legislation (the"Applicable Requirements") shall not apply to the Top Fund,or PFSL, as the case may be, in respect of certain investmentsto be made by the Top Fund in the AGF Canadian Money MarketFund (the "Underlying Fund"):


(a) the requirement contained in the Legislation prohibitingthe Top Fund from knowingly making or holding an investmentin a person or company in which the Top Fund, alone or togetherwith one or more related mutual funds, is a substantial securityholder;


(b) the requirement contained in the Legislation requiring PFSLto file a report of the following:



i. every transaction of purchase or sale of securities betweenthe Top Fund and any related person or company; and


ii. any transaction in which, by arrangement other than an arrangementrelating to insider trading in portfolio securities, the TopFund is a joint participant with one or more of its relatedpersons or companies, in respect of the Top Fund to which itprovides services or advice, within 30 days after the end ofthe month in which it occurs.


AND WHEREAS pursuant to the Mutual RelianceReview System for Exemptive Relief Applications (the "System"),the Ontario Securities Commission is the principal regulatorfor this application.


AND WHEREAS it has been represented by PFSLto the Decision Makers that:


1.PFSL is a corporation incorporated under and governed by thelaws of Ontario and is registered as a mutual fund dealer orequivalent under the securities legislation of each of the Jurisdictions.The head office of PFSL is located in Mississauga, Ontario.


2.The Top Fund is an open-ended unincorporated mutual fund trustgoverned by the laws of the province of Ontario.


3.PFSL is the manager, trustee, exclusive distributor, promoterand the registrar and transfer agent of the Top Fund and RoyalTrust is the custodian of the Top Fund.


4.Units of the Top Fund and Underlying Fund are offered for saleon a continuous basis in the Jurisdictions pursuant to a simplifiedprospectus and annual information form (the "Prospectus") receiptedin each of the Jurisdictions.


5.The Top Fund and Underlying Fund are reporting issuers in eachof the provinces and territories of Canada and are not in defaultof any requirements of the acts or rules applicable in eachof the provinces and territories.


6.To achieve its investment objectives, the Top Fund will investits net assets, excluding cash and cash equivalents held tomeet redemptions and to pay management fees and other expenses,in securities of the Underlying Fund. The manager of the UnderlyingFund has been chosen by PFSL on the basis of their managementstyle, their choice of sub-advisers and other consultants, theirefficiency of administration, the calibre of their reportingprocedures and the historic performance of their funds.


7.The simplified prospectus of the Top Fund will describe theintent of the Top Fund to invest in the Underlying Fund in itsinvestment objectives. The simplified prospectus for the TopFund will also disclose the investment objectives, investmentstrategies, risks and restrictions of the Top Fund and the UnderlyingFund, and the manager of the Underlying Fund.


8.The arrangements between or in respect of the Top Fund and theUnderlying Fund will be such as to avoid the duplication ofsales charges, redemption charges or management fees. The TopFund will receive management fee distributions from the UnderlyingFund and management fee rebates from the manager of the UnderlyingFund. An incremental management fee borne by unitholders ofthe Top Fund is limited to 0.10%. The incremental managementfee is warranted given the portfolio allocation and consolidatedreporting services provided to investors in the Top Funds.


9.Except to the extent evidenced by this Decision and the specificapprovals to be granted by the Decision Makers pursuant to NationalInstrument 81-102 ("NI 81-102"), the investments by the TopFund in securities of the Underlying Fund will comply in allrespects with the investments restrictions in the Legislationand in NI 81-102.


10.Unless the requested relief is granted,


i. the Top Fund would be prohibited from knowingly making andholding an investment in securities of the Underlying Fund tothe extent that the Top Fund, either alone or in combinationwith other PFSL managed funds, is a substantial security holderof the Underlying Fund; and


ii. PFSL would be required to file reports respecting everypurchase or sale of securities of the Underlying Fund by theTop Fund.


11.Each investment by the Top Fund in the Underlying Fund willbe in the best interests of the Top Fund and will representthe business judgment of responsible persons uninfluenced byconsiderations other than the best interests of the Top Fund.


AND WHEREAS pursuant to the System this MRRSDecision Document evidences the decision of each Decision Maker;


AND WHEREAS each of the Decision Makers issatisfied that the tests contained in the Legislation that providesthe Decision Maker with the jurisdiction to make the Decisionhas been met;


THE DECISION of the Decision Makers pursuantto the Legislation is that the Applicable Requirements shallnot apply so as to prevent the Top Fund or PFSL, as the casemay be, from making and holding investments by the Top Fundin securities of the Underlying Fund;


PROVIDED THAT IN RESPECT OF the investmentby the Top Fund in securities of the Underlying Fund:


1.the Decision, as it relates to the jurisdiction of a DecisionMaker, will terminate upon the coming into force of any legislationor rule of that Decision Maker dealing with matters in section2.5 of NI 81-102.


2.the Decision shall only apply if, at the time the Top Fund makesor holds an investment in the Underlying Fund, the followingconditions are satisfied:


(a) the securities of both the Top Fund and the Underlying Fundare being offered for sale in the jurisdiction of the DecisionMaker pursuant to a simplified prospectus and annual informationform which has been filed with and accepted by the DecisionMaker;


(b) the investment by the Top Fund in securities of the UnderlyingFund is compatible with the fundamental investment objectiveof the Top Fund;


(c) the simplified prospectus of the Top Fund, describes theintent of the Top Fund to invest in the Underlying Fund anddiscloses the manager, the name of its portfolio adviser, theinvestment objectives and investment strategies of the UnderlyingFund, and the risks associated with investing in the UnderlyingFund;


(d) the Underlying Fund is not a mutual fund whose investmentobjective includes investing directly or indirectly in othermutual funds;


(e) if the Underlying Fund disclosed in the investment objectivesof the simplified prospectus has been changed, securityholdersof the Top Fund have given prior approval and the prospectushas been amended or a new simplified prospectus filed to reflectthe change;


(f) there are compatible dates for the calculation of the netasset value of each of the Top Fund and the Underlying Fundfor the purpose of the issue and redemption of the securitiesthereof;


(g) no sales charges are payable by the Top Fund in relationto its purchases of securities of the Underlying Fund;


(h) if redemption fees are charged by the Underlying Fund inrespect of the redemption by the Top Fund of securities of theUnderlying Fund owned by the Top Fund, the redemption fee willbe paid by the Manager of the Top Fund and the amount of theredemption fee will be deducted from the proceeds of redemptionprior to payment to the investor in the Top Fund and remittedto the Manager;


(i) no fees or charges, other than the redemption fees describedin paragraph h, and the commissions and trailing fees disclosedin the Prospectus of the Top Fund, are paid by the Top Fundand the Underlying Fund, by their respective managers or principaldistributors, or by any affiliate or associate of any of theforegoing entities, to anyone in respect of the Top Fund's purchase,holding or redemption of the securities of the Underlying Fund;


(j) the arrangements between or in respect of the Top Fund andthe Underlying Fund will be such as to avoid the duplicationof management fees;


(k) any notice provided to securityholders of the UnderlyingFund as required by applicable laws or the constating documentsof the Underlying Fund has been delivered by the Top Fund toits securityholders;


(l) all of the disclosure and notice material prepared in connectionwith a meeting of securityholders of the Underlying Fund andreceived by the Top Fund has been provided to its securityholders,the securityholders have been permitted to direct a representativeof the Top Fund to vote its holdings in the Underlying Fundin accordance with their direction, and the representative ofthe Top Fund has not voted its holdings in the Underlying Fundexcept to the extent the securityholders of the Top Fund havedirected;


(m) in addition to receiving the annual and, upon request, thesemi-annual financial statements, of the Top Fund, securityholdersof the Top Fund have received appropriate summary disclosurein respect of the Top Fund's holdings of securities of the UnderlyingFund in the financial statements of the Top Fund; and


(n) to the extent that the Top Fund and the Underlying Funddo not use a combined simplified prospectus and annual informationform containing disclosure about the Top Fund and the UnderlyingFund, copies of the simplified prospectus and annual informationform of the Underlying Fund have been provided upon requestto securityholders of the Top Fund and the right to receivethese documents is disclosed in the prospectus of the Top Fund.

December12, 2001.

"PaulM. Moore"       "Richard W. Korthals"