Securities Law & Instruments


MRRS Decision

MRRS Decision providing relief from the requirementthat prohibits a person or company from trading a in a securityunless the person or company is registered in the appropriatecategory of registration, in connection with trades in commonshares pursuant to a share selling service established afterthe demutualisation of the applicant.

Applicable Ontario Statute

Securities Act, R.S.O. 1990, c. S.5, as am.,ss. 25, 74(1), and 144.







WHEREAS the local Canadian securities regulatory authority or regulator (the "Decision Maker")in each of British Columbia, Alberta, Saskatchewan, Manitoba,Ontario, Quebec, New Brunswick, Nova Scotia, Prince Edward Island,Newfoundland and Labrador, Yukon, Northwest Territories andNunavut (the "Jurisdictions") has received an applicationfrom Sun Life Financial Services of Canada Inc. ("Sun Life")(formerly Sun Life of Canada Holdings Corp.) for a decisionpursuant to the securities legislation (the "Legislation")of each of the Jurisdictions that:

(i) paragraph B of the decision (the "ExistingSun Life Decision") dated October 7, 1999 granted to SunLife and Sun Life Assurance Company of Canada ("Sun LifeAssurance") by the Decision Maker in each Jurisdiction,other than Québec, be rescinded; and

(ii) that a new decision be granted by the DecisionMakers in each Jurisdiction (including Quebec) which providesrelief from the requirement (the "Dealer Registration Requirement")contained in the Legislation, that prohibits a person or companyfrom trading in a security unless the person or company is registeredin the appropriate category of registration under the Legislation,to Sun Life, Sun Life Assurance, CIBC Mellon Trust Company ("CIBCMellon") and Eligible Policyholders (as defined in paragraph7) (all as provided in the Existing Sun Life Decision) as wellas to Former Clarica Service Participants and Electing ClaricaParticipants (in each case, as defined below), in connectionwith trades in common shares ("Sun Life Common Shares")of Sun Life made through CIBC Mellon pursuant to a share sellingservice (the "Sun Life Service") established by SunLife and administered by CIBC Mellon;

AND WHEREAS under the Mutual RelianceReview System for Exemptive Relief Applications (the "System"),the Ontario Securities Commission is the principal regulatorfor this Application;

AND WHEREAS Sun Life has representedto the Decision Makers as follows:

Clarica Life Insurance Company

1. Clarica Life Insurance Company ("Clarica")is an insurance company incorporated under the Insurance CompaniesAct (Canada) (the "Federal Act") and is a reportingissuer (or the equivalent) under the Legislation of each Jurisdiction.The common shares ("Clarica Common Shares") of Claricaare listed on The Toronto Stock Exchange (the "TSX").

Sun Life Financial Services of Canada Inc.

2. Sun Life is a holding company incorporatedunder the Federal Act and is a reporting issuer (or equivalent)under the Legislation of each Jurisdiction. In addition to theTSX, the Sun Life Common Shares are listed on the New York andPhilippine stock exchanges.

CIBC Mellon

3. CIBC Mellon is the registrar and transferagent for the Clarica Common Shares and the Sun Life CommonShares.

The Transaction

4. On December 17, 2001, Clarica and Sun Lifeentered into a transaction agreement, pursuant to which SunLife agreed to acquire all of the outstanding Clarica CommonShares (the "Transaction"). The Transaction is proposedto be effected through a reorganization of Clarica's capitalstructure to provide for the exchange of each outstanding ClaricaCommon Share, except those Clarica Common Shares beneficiallyowned by Sun Life as general fund assets, for 1.5135 Sun LifeCommon Shares, through a series of transactions.

5. The Transaction was approved by holders ofClarica Common Shares and holders of Clarica voting insurancepolicies at a special meeting held on March 6, 2002. Subjectto the satisfaction of all closing conditions and the receiptof all applicable regulatory approvals, it is anticipated thatthe Transaction will be completed in the second quarter of 2002.

6. Upon the closing of the Transaction, SunLife will own all of the outstanding Clarica Common Shares andeach holder of Clarica Common Shares will become a holder ofSun Life Common Shares.

The Sun Life Share Selling Service

7. In connection with the demutualization ofSun Life Assurance, Sun Life established the Sun Life Serviceto facilitate the ownership and transfer of Sun Life CommonShares received by certain insurance policyholders of Sun LifeAssurance ("Eligible Policyholders") on completionof the demutualization. The establishment of the Sun Life Servicewas, among other things, intended to:

(i) provide a depositary for Sun Life CommonShares received by Eligible Policyholders on the demutualizationwho did not have, or did not want to establish, a brokerageaccount with an investment dealer; and

(ii) facilitate the sale of relatively small,and often odd lot, numbers of Sun Life Common Shares which manyEligible Policyholders received pursuant to the demutalization.

In addition, the Sun Life Service reduces theadministrative costs to Sun Life of dealing with a large numberof registered shareholders, as the Sun Life Common Shares subjectto the Sun Life Service are all registered in the name of CIBCMellon, as nominee.

8. Under the Sun Life Service, Eligible Policyholdersresident in Canada who received Sun Life Common Shares on thedemutualization of Sun Life Assurance and who hold these SunLife Common Shares (the "Initial Service Shares")through CIBC Mellon as nominee are able to sell the InitialService Shares simply by contacting CIBC Mellon, the administratorof the Sun Life Service, through written instructions or bytelephone. Under the Sun Life Service, CIBC Mellon has establishedan account with a registered dealer (the "Dealer")and, through the Dealer, arranges to sell Initial Service Shareson behalf of Eligible Policyholders on a pooled basis and remitthe proceeds, less applicable fees, to the applicable EligiblePolicyholders.

9. The Dealer is registered as a dealer underthe Legislation of each of the Jurisdictions in the categoryof broker and investment dealer (or the equivalent).

10. As required under the Existing Sun LifeDecision, the Sun Life Service is now only offered to EligiblePolicyholders and only in respect of the Initial Service Sharesthat were received by them on the demutualization of Sun LifeAssurance.

11. Under the Sun Life Service, only sell ordersat the market price are accepted by CIBC Mellon and no adviceregarding the decision to sell or hold Sun Life Common Sharesis offered to any Eligible Policyholder. Neither Sun Life norSun Life Assurance subsidizes the costs of selling Sun LifeCommon Shares under the Sun Life Service, although EligiblePolicyholders benefit from any reduced commission that can benegotiated with the Dealer. In addition to paying the correspondingcharged commission, an Eligible Policyholder in Canada is requiredto pay a flat fee (currently Cdn.$15.00) to CIBC Mellon foreach sale of Sun Life Common Shares made on behalf of the EligiblePolicyholder under the Sun Life Service. Any Eligible Policyholderwho wishes to sell Sun Life Common Shares held on their behalfby CIBC Mellon under the Sun Life Service, otherwise than throughthe Sun Life Service, is free to do so by transferring the SunLife Common Shares to another dealer or otherwise withdrawingthe Sun Life Common Shares from the Sun Life Service. Any informationdistributed to Eligible Policyholders regarding the Sun LifeService does not contain any investment advice as to the desirabilityof Eligible Policyholders holding or selling their Sun LifeCommon Shares. The Dealer does not open individual accountsor engage in "know-your-client" procedures with respectto individual Eligible Policyholders using the Sun Life Service.

12. In connection with the establishment ofthe Sun Life Service, Sun Life and Sun Life Assurance appliedfor and, together with CIBC Mellon, as administrator pursuantto the Sun Life Service, and Eligible Policyholders, were grantedrelief pursuant to the Existing Sun Life Decision from the DealerRegistration Requirement under the Legislation of each Jurisdictionother than Quebec in respect of trades in Sun Life Common Sharespursuant to the Sun Life Service.

13. Sun Life and Sun Life Assurance also obtaineda decision document dated August 23, 2000 containing an extractof the minutes of a meeting held by the Commission des valeursmobilières du Québec on March 15, 2000 (the "ExistingQuebec Decision"), pursuant to which the Commission desvaleurs mobilières du Québec, under section 263of the Securities Act (Quebec), granted relief from registrationrequirements in connection with the establishment and administrationof the Sun Life Service.

The Clarica Share Selling Service

14. In connection with the demutualization ofThe Mutual Life Assurance Company of Canada (which is now Clarica),Clarica established a share selling service (the "ClaricaService"), administered by CIBC Mellon, to primarily facilitatethe ownership and transfer of Clarica Common Shares receivedby certain insurance policyholders of The Mutual Life AssuranceCompany of Canada on completion of the demutualization.

15. In connection with the establishment ofthe Clarica Service, Clarica, CIBC Mellon and shareholders ofClarica were granted relief from the Dealer Registration Requirementof the Legislation of each Jurisdiction by a decision datedDecember 23, 1998 (reference (1999) 22 OSCB 474) (the "ExistingClarica Decision"). The Clarica Service has been administeredsimilarly to the Sun Life Service except that:

(i) holders of Clarica Common Shares who participatein the Clarica Service are the registered holders of such ClaricaCommon Shares whereas the Initial Service Shares are registeredin the name of CIBC Mellon, as nominee;

(ii) participants in the Clarica Service arecurrently permitted to increase their holdings of Clarica CommonShares in the Clarica Service, whereas Eligible Policyholdersparticipating in the Sun Life Service are not permitted to increasethe number of Sun Life Common shares held by them in the SunLife Service; and

(iii) any holders of Clarica Common Shares canelect to participate in the Clarica Service at any time, whereasparticipation in the Sun Life Service was restricted to EligiblePolicyholders.

Extension of the Sun Life Share Selling Serviceto Clarica Shareholders

16. The Existing Sun Life Decision was grantedbased on representations that the Sun Life Service was onlymade available to Eligible Policyholders and only in respectof the Initial Service Shares that were received by them onthe demutualization of Sun Life Assurance.

17. It is proposed that holders of Clarica CommonShares who hold Clarica Common Shares in the Clarica Service(the "Clarica Service Shares") as at the date of theTransaction, will, upon receiving Sun Life Common Shares ("ReplacementService Shares") in exchange for the Clarica Service Sharespursuant to the Transaction, have the Replacement Service Sharesregistered in the name of CIBC Mellon and held on their behalfunder the Sun Life Service. The holders of Replacement ServiceShares (the "Former Clarica Service Participants")will be eligible to participate, in respect of the ReplacementService Shares, in the Sun Life Service on the same basis, andsubject to the same restrictions, as Eligible Policyholdersin respect of Initial Service Shares that they hold throughthe Sun Life Service.

18. In addition, persons and companies ("ClaricaNon-Service Holders") who are registered holders of ClaricaCommon Shares and hold such Clarica Common Shares outside ofthe Clarica Service as at the date of the Transaction and receiveSun Life Common Shares in exchange for these Clarica CommonShares pursuant to the Transaction will be given the optionof registering these Sun Life Common Shares in the name of CIBCMellon to be held on their behalf under the Sun Life Service(the Sun Life Common Shares so registered being referred toherein as the "Elected Service Shares" and the electingClarica Non-Service Holders being referred to as the "ElectingClarica Participants"). Electing Clarica Participants willbe able to participate in the Sun Life Service, in respect ofthe Elected Service Shares, on the same basis as Eligible Policyholdersin respect of Initial Service Shares, and Former Clarica ServiceParticipants, in respect of Replacement Service Shares.

19. Clarica Non-Service Holders, who have not,as of the date of the Transaction, made an election to participatein the Sun Life Service in respect of any Sun Life Common Sharesreceived in exchange for Clarica Common Shares pursuant to theTransaction, will be informed by Sun Life of the terms underwhich they can elect, after the Transaction, to participatein the Sun Life Service in accordance with the terms of thisDecision.

20. Sun Life believes it is more efficient andcost effective to provide one share selling service to all ofits shareholders who choose to participate in such a service,rather than administering two separate share selling services.As well, Sun Life believes that, because of the large numberof small, registered shareholders that both Sun Life and Claricahave, it is more efficient and cost effective to deal with theseshareholders if they hold their shares through the Sun LifeShare Selling Service.

AND WHEREAS under the System this MRRSDecision Document evidences the decision of each Decision Maker(collectively, the "Decision");

AND WHEREAS each Decision Maker is satisfiedthat the test contained in the Legislation that provides theDecision Maker with the jurisdiction to make the Decision hasbeen met;

IT IS THE DECISION of the Decision Makersof each Jurisdiction, other than Quebec, that paragraph B ofthe Existing Sun Life Decision is rescinded as of the date hereof;

AND IT IS THE DECISION of the DecisionMakers of each Jurisdiction that the Dealer Registration Requirementshall not apply to any of Sun Life, Sun Life Assurance, CIBCMellon, Eligible Policyholders, Former Clarica Service Participantsor Electing Clarica Participants in respect of either

(A) the placing of unsolicited orders ("SaleOrders") with CIBC Mellon by Eligible Policyholders tosell Initial Service Shares, by Former Clarica Service Participantsto sell Replacement Service Shares and by Electing Clarica Participantsto sell Elected Service Shares, in accordance with the Sun LifeService, or

(B) the execution by CIBC Mellon of the SaleOrders through a Dealer, in accordance with the Sun Life Service,


(i) in the case of the placement of any SaleOrder by an Electing Clarica Participant or the execution ofsuch Sale Order by CIBC Mellon, the Electing Clarica Participantbecame an Electing Clarica Participant within 90 days of theTransaction;

(ii) CIBC Mellon is, at the relevant time, appropriatelylicensed or otherwise legally authorized to carry on the businessof a trust company in the Jurisdiction; and

(iii) for the purposes hereof, a Sale Ordershall not be considered "solicited" by reason of SunLife distributing to any person or company that is or was eligibleto participate in the Sun Life Service disclosure documents,notices, brochures or similar documents advising of the availabilityof the Sun Life Service or by reason of Sun Life or CIBC Melloninforming such person or company of the details of the operationof the Sun Life Service in response to an enquiry.

May 23, 2002.

"Paul M. Moore"      "Robert L. Shirriff"