Securities Law & Instruments


Mutual Reliance Review System for ExemptiveRelief Applications - Issuer exempted from valuation requirements,and minority approval requirements varied, in connection withgoing private transaction with arm's length party where minorityshareholders will receive equal or greater consideration pershare than controlling shareholder.

Applicable Ontario Rules

Rule 61-501 - Insider Bids, Issuer Bids, GoingPrivate Transactions and Related Party Transactions, ss. 4.4,4.7 and 9.1.













WHEREAS the local securities regulatoryauthority or regulator (the "Decision Maker") in eachof Ontario and Québec (the "Jurisdictions")has received an application from Mackenzie Investment ManagementInc. ("MIMI" or the "Company") for a decisionunder the securities legislation of the Jurisdictions (the "Legislation")that the requirement contained in the Legislation to obtaina formal valuation (the "Valuation Requirement") inconnection with a going private transaction shall not apply,and that the requirement to obtain the approval of minorityshareholders (the "Minority Approval Requirement")in connection with a going private transaction shall be varied,in connection with a proposed transaction (the "Transaction")whereby MIMI will be sold to Waddell & Reed Financial, Inc.("WDR");

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

AND WHEREAS, unless otherwise defined,the terms herein have the meaning set out in National Instrument14-101 Definitions or in Québec Commission Notice 14-101;

AND WHEREAS MIMI has represented to theDecision Makers that:

1. MIMI is incorporated under the laws ofthe State of Delaware, is governed as to corporate mattersby the General Corporation Law of the State of Delaware ("DGCL")and is a reporting company under the United States SecuritiesExchange Act of 1934 (the "1934 Act"). MIMI is areporting issuer in all of the provinces of Canada.

2. The authorized capital of MIMI consistsof 100,000,000 shares of common stock ("Common Shares"),of which 18,655,550 were issued and outstanding as of August29, 2002. The Common Shares are listed and posted for tradingon the Toronto Stock Exchange. MIMI is not in default of anyrequirement under the Legislation. MIMI has also filed allreports with the United States Securities and Exchange Commissionrequired to be filed by Sections 13 or 15(d) of the 1934 Actduring the preceding 12 months.

3. MIMI provides, through various subsidiaries,investment management, marketing, distribution and other administrativeservices to Ivy Fund ("Ivy Fund"). Ivy Fund is aMassachusetts business trust registered under the United StatesInvestment Company Act of 1940 as a U.S. open-end investmentcompany, consisting of 16 separate portfolios. In addition,a wholly-owned subsidiary of MIMI, Ivy Management Inc. ("IMI"),provides sub-advisory services to 15 mutual funds sold inCanada and managed by Mackenzie Financial Corporation ("MFC").

4. MFC, through its wholly-owned subsidiaryIvy Acquisition Corporation ("IAC"), beneficiallyowns 15,987,910 Common Shares, or approximately 85.7% of theoutstanding Common Shares. MFC and MIMI deal at arm's lengthwith WDR.

5. WDR, a Delaware corporation, is a leadingfinancial services organization with a network of more than3,100 financial advisors serving clients throughout the UnitedStates. WDR provides, through various subsidiaries, a varietyof investment options including equity, growth, international,income, value, asset allocation, fixed income, and money marketfunds, variable annuity and life insurance and disabilityproducts. WDR's Class A common stock is listed and postedfor trading on the New York Stock Exchange.

6. The Transaction contemplates the sale ofMIMI to WDR in a series of steps pursuant to a stock purchaseagreement entered into between MFC, MIMI, IAC and WDR on August29, 2002 (the "Stock Purchase Agreement") and undera plan of complete liquidation and voluntary dissolution ofMIMI (the "Plan of Dissolution"). Each of the stepscontemplated by the Stock Purchase Agreement and the Planof Dissolution is contingent upon the occurrence of all othersteps, so that if the Plan of Dissolution is not effectuatedor the transactions contemplated by the Stock Purchase Agreementare not consummated, none of the Company's shareholders willbe entitled to receive any cash payment for their Common Shares.

7. Upon the consummation of the events contemplatedby the Stock Purchase Agreement and the Plan of Dissolution,MIMI public shareholders will receive cash in the minimumamount of U.S. $4.05 for each Common Share that they own.This per share cash payment to MIMI public shareholders issubject to possible increase but not to any decrease. MFCwill receive an amount of cash per Common Share no greaterthan the amount of cash per Common Share distributed to MIMIpublic shareholders, but such cash amount payable to MFC willbe subject to possible decrease pursuant to certain closingadjustments and post-closing adjustments and indemnificationobligations of MFC to WDR to which MIMI public shareholderswill not be subject. In all circumstances upon the closingof the Transaction, MIMI public shareholders and MFC willreceive cash, with MIMI public shareholders receiving at leastthe same amount on a per share basis as MFC and, if thereis any negative adjustment at closing or MFC makes any post-closingadjustment or indemnification payments to WDR, more than MFC.

8. MIMI public shareholders will be entitledto their pro rata share of any positive adjustments up toclosing or as a result of any adjustment after closing. MIMIpublic shareholders will not be subject to any negative adjustmentsthat occur up to or after closing. MFC will solely bear therisk of any negative adjustments and has agreed to be solelyresponsible for all indemnification obligations to WDR. Underall circumstances of the Transaction, MIMI public shareholderswill receive cash proceeds per MIMI share equal to or greaterthan the cash proceeds paid to MFC on an equivalent per MIMIshare basis.

9. The shareholders of MIMI will be askedat a special meeting expected to be held in December, 2002to approve and adopt the Plan of Dissolution pursuant to Section281(b) of the DGCL. The dissolution of the Company is expectedto commence as soon as practicable after approval of the Planof Dissolution by the holders of a majority of the outstandingCommon Shares at the special meeting and is contingent onthe satisfaction of conditions to closing set forth in theStock Purchase Agreement. MFC has agreed to cause IAC, whichbeneficially owns approximately 85.7% of the outstanding CommonShares, to vote its Common Shares in favour of approval andadoption of the Plan of Dissolution.

10. Following approval of the Plan of Dissolution,MIMI will file with the Secretary of State of the State ofDelaware a certificate of dissolution dissolving the Company.The Company's dissolution will become effective, in accordancewith the DGCL, upon proper filing of the certificate of dissolutionwith the Secretary of State. Upon the filing of the certificateof dissolution with the Secretary of State, all holders ofCommon Shares will cease to have any rights as shareholdersof the Company, except for the right to receive payment underthe Plan of Dissolution which, in the case of MIMI publicshareholders, shall be a minimum cash amount of U.S. $4.05,subject to possible increase but not to any decrease.

11. Immediately upon the effectuation of thePlan of Dissolution, MFC will sell all the outstanding capitalstock of IAC to WDR pursuant to the terms of the Stock PurchaseAgreement. MFC will receive from WDR cash consideration pursuantto the Stock Purchase Agreement in a per share amount no greaterthan the amount of cash per Common Share distributed to theMIMI public shareholders but the cash amount receivable byMFC will be subject to possible decrease pursuant to certainpost-closing adjustments and indemnification obligations ofMFC to WDR. In order to secure this indemnification obligationin part, WDR will withhold U.S. $3,000,000 of the cash proceedspayable to MFC under the Stock Purchase Agreement. In addition,an amount equal to the maximum aggregate amount potentiallypayable by MIMI or IAC pursuant to an arrangement with certainofficers of MIMI, as discussed below, will be held back fromthe cash amount MFC is entitled to receive pursuant to theStock Purchase Agreement. MFC may also be entitled to a post-closingcash payment under certain circumstances, which payment wouldbe no greater on a per Common Share basis than the post-closingpayment received by MIMI public shareholders. MFC may be requiredto make a post-closing payment to WDR under certain circumstances.

12. The MIMI proxy circular for the specialmeeting (the "Proxy Circular") will inform MIMIshareholders that the members of the Company's Board of Directorswho are not employees of the Company, or directors or officersof MFC or any affiliates of MFC, have unanimously determinedthat the Stock Purchase Agreement and the Plan of Dissolutionare advisable, fair to and in the best interests of, the shareholdersof the Company, including MIMI public shareholders. In addition,along with an extensive discussion of the factors that MIMI'sBoard of Directors considered in reaching its decisions withrespect to the Stock Purchase Agreement and the Plan of Dissolution,the Proxy Circular will contain disclosure that the Company'sBoard of Directors believes that distribution of MIMI's assetson dissolution under the Plan of Dissolution will result inmore value to the Company's shareholders than any other availablealternatives, directions or strategies.

13. In the course of its deliberations, theCompany's Board of Directors received and considered, amongother things, a fairness opinion given as of August 28, 2002by Putnam Lovell NBF that the consideration to be receivedby all of MIMI's shareholders in connection with the StockPurchase Agreement is fair, from a financial point of view,to all of MIMI's shareholders and that the consideration tobe received by MIMI public shareholders in connection withthe Plan of Dissolution is fair, from a financial point ofview, to MIMI public shareholders.

14. In connection with the Transaction andat the request of WDR, MFC and WDR have negotiated and enteredinto a Voting, Support and Indemnification Agreement (the"Voting and Indemnification Agreement"). Pursuantto the terms of the Voting and Indemnification Agreement,MFC has agreed to cause IAC to vote the shares of MIMI thatIAC owns in favour of the adoption and approval of the Planof Dissolution.

15. MFC has also agreed under the Voting andIndemnification Agreement to indemnify and hold harmless WDRand its affiliates from and against any and all damages, lossesand expenses that WDR or any of its affiliates incurs andthat relate to or arise out of, among other things: (a) anybreach or default by MIMI or IAC of certain representationsor warranties given by MIMI and IAC in the Stock PurchaseAgreement; (b) any breach or default by MIMI, MFC or IAC ofany of the covenants or agreements under the Stock PurchaseAgreement or the Voting Agreement; (c) the Plan of Dissolution;or (d) the restatement on July 9, 2002 of MIMI's results ofoperations for each of the years ended March 31, 1999 throughMarch 31, 2001 and the quarters ended June 30, 2001, September30, 2001 and December 31, 2001.

16. A condition precedent to the closing ofthe Transaction requested by WDR requires MFC and WDR to enterinto a sub-advisory agreement (the "Sub-Advisory Agreement")to take effect immediately upon the closing of the Transactionfor an initial term of five years. MFC has agreed that IMI,as an indirect wholly-owned subsidiary of WDR after closingof the Transaction, will be able to continue to provide investmentsub-advisory services to certain Canadian mutual funds managedby MFC on normal commercial terms. IMI will be paid for itsservices as investment sub-advisor for each sub-advised portfoliobased on a percentage of the net assets of each applicablefund. Prior to the closing of the Transaction, MFC and WDRwill enter into an interim sub-advisory agreement on normalcommercial terms with respect to certain Canadian mutual fundsmanaged by MFC.

17. As a condition to the consummation ofthe transactions contemplated by the Stock Purchase Agreementand in connection with the Sub-Advisory Agreement, MFC WDRand IMI have also agreed to enter into a marketing agreement(the "Marketing Agreement"), whereby MFC has agreedto launch one new fund to be advised by IMI or to award IMIone new mandate for an existing MFC fund as soon as is commerciallyreasonable after the effective date of the Marketing Agreement,and to award IMI any combination of fund mandates on new and/orexisting MFC funds which in total represents at least threeadditional mandates to IMI. The Marketing Agreement also provides,among other things, that MFC will use reasonable efforts tointroduce WDR to MFC affiliates and to seek additional mandatesfor IMI to provide sub-advisory services and that IMI is tobe given preferred treatment in consideration for any newfund which contains elements that were introduced to MFC byIMI. The Marketing Agreement provides that MFC will considerWDR in any search for an advisor or sub-advisor to managenew mandates offered in Canada for which WDR has existing,demonstrated capability and similar reciprocal rights willbe provided to MFC by WDR in the United States. As well IMI,as the sub-advisor to certain MFC funds, will agree to providemarketing support to promote the sale of such MFC funds inaccordance with industry practice.

18. At the request of WDR, MFC and WDR haveagreed to enter into a Tax Matters Agreement (the "TaxAgreement") in connection with the Stock Purchase Agreement.Under the Tax Agreement MFC will be responsible for and indemnifyand hold harmless WDR and its affiliates from all taxes andreasonable costs and expenses arising out of, based upon orattributable to, among other things, various tax matters relatedto the Transaction.

19. Contemporaneously with the closing ofthe Transaction, MFC has agreed to enter into a trademarkagreement (the "Trademark Agreement") with the trusteesof the Ivy Fund and IMI. The Trademark Agreement will setout the mutual understandings of the parties with respectto the ongoing use of the IVY FUNDS marks in connectionwith the mutual fund business of IMI in the United Statesand the continued use of the IVY FUNDS marks by MFCin Canada in connection with the mutual fund distributionservices MFC provides in Canada.

20. The Voting and Indemnification Agreement,the Sub-Advisory Agreement, the Marketing Agreement, the TaxAgreement and the Trademark Agreement were entered into forreasons other than to increase the value of the considerationto be received indirectly by MFC for its MIMI Common Shares.These agreements will provide for on-going arm's length businessrelations in accordance with industry practice after closing.

21. Since December 2000, the Company has beenparty to agreements with certain of its executive officersdealing with a change in control of MIMI. At present, theCompany has change in control agreements (collectively, the"Change in Control Agreements") with each of thefollowing officers of the Company: Keith J. Carlson, JamesW. Broadfoot III, Beverly Yanowitch, Paul P. Baran, ThomasH. Bivin, Stephen J. Barrett, Robert Perry and Thomas Bracco(collectively, the "Officers"). The Change in ControlAgreements provide for the payment of severance by the Companyto each of the Officers upon a change in control in the Companyand upon the occurrence of an event of termination. Each ofthe Change in Control Agreements was negotiated independentlyof the Stock Purchase Agreement and the Plan of Dissolution.The Change in Control Agreements were entered into for reasonsother than to increase the value of the consideration to bereceived by the Officers for their respective MIMI CommonShares. The Transaction will likely be considered a changeof control under each of the Change in Control Agreements.

22. Upon a change of control and the occurrenceof an event of termination, each of the Officers would beentitled to receive severance which would include paymentof their pro-rata portion of their target bonus for the fiscalyear of their termination, reimbursement for expenses in connectionwith their termination, continuation of their respective benefitplans for a period of twenty-four months following terminationand a lump sum payment which, depending on the terms of theindividual Change in Control Agreement, would vary in amountfrom two times the aggregate of their base salary, bonus andany profit sharing payments and one times the aggregate oftheir base salary, bonus and any profit sharing payments.

23. The Board of Directors of MIMI has determinedthat it is appropriate to provide cash bonuses (the "BonusPool") to some of the Officers for their assistance ineffectuating the Transaction. The Company's President andChief Executive Officer will be entitled to an amount equalto 50% of the Bonus Pool, with the remaining 50% of the BonusPool to be divided among the other Officers who the Company'sBoard of Directors deem had important roles in the consummationof the Transaction.

24. The Proxy Circular will contain disclosureof the terms of the Stock Purchase Agreement, the Plan ofDissolution, the Voting and Indemnification Agreement, theSub-Advisory Agreement, the Marketing Agreement, the Tax MattersAgreement, the Trademark Agreement, the Change in ControlAgreements and the Bonus Pool.

25. None of the Officers will be able to castthe votes attaching to their respective Common Shares forpurposes of the Minority Approval Requirement applicable toMIMI in the context of the Transaction.

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

AND WHEREAS each of the Decision Makersis satisfied that the test contained in the Legislation thatprovides the Decision Maker with the jurisdiction to make theDecision has been met;

THE DECISION of the Decision Makers underthe Legislation is that, in connection with the Transaction,MIMI shall be exempt from the Valuation Requirement and theMinority Approval Requirement shall be varied in order to permitMIMI to include the votes attached to the Common Shares heldby IAC in determining minority approval of the Transaction,provided that MIMI complies with the other applicable provisionsof the Legislation.

November 8, 2002.

"Ralph Shay"