Securities Law & Instruments

Headnote

Section 147 - issuer is exempt from the paymentof the fee otherwise payable pursuant to section 7.3 of Rule45-501 in connection with a dual structure transaction wherea filing fee will have already been paid.

Statutes Cited

Securities Act, R.S.O. 1990, c. S.5, as am.,s. 147.

Rules Cited

Ontario Securities Commission Rule 45-501 -Exempt Distributions, s. 7.3.

IN THE MATTER OF

THE SECURITIES ACT

R.S.O. 1990, CHAPTER S.5,AS AMENDED (the "Act")

AND

IN THE MATTER OF

SUMMIT REAL ESTATE INVESTMENTTRUST LIMITED PARTNERSHIP

 

ORDER

(Section 147)

UPON the application (the "Application")by Summit Real Estate Investment Trust Limited Partnership ("Borrower")for an order pursuant to Section 147 of the Securities Act (Ontario)(the "Act") exempting the Borrower from the paymentof duplicative fees otherwise payable under Section 7.3 of Rule45-501 of the Ontario Securities Commission ("Rule 45-501")in connection with a commercial mortgage loan from Falcon Trust("Issuer") to the Borrower;

AND UPON considering the Applicationand the recommendation of the staff of the Commission;

AND UPON the Borrower having representedto the Commission as follows:

1. The Issuer was formed under the laws ofthe Province of Ontario on July 10, 2002.

2. The Issuer filed, and obtained a receiptfor, a final (short form) prospectus (the "Prospectus")dated October 7, 2002 from the securities regulatory authoritiesand securities commissions in each of the provinces of Canada.

3. The Prospectus qualified for distributionOne Hundred Forty-Seven Million Five Hundred Thousand ($147,500,000)Dollars of Commercial Mortgage Pass-Through Certificates,Series 2002 SMU (the "Certificates") of the Issuer.

4. Each Certificate evidences an undividedco-ownership interest in a pool of mortgage loans (the "MortgageLoans") and certain related assets of the Issuer. Theproceeds to the Issuer from its sale of the Certificates wereused by the Issuer on behalf of the Certificate holders tooriginate the Mortgage Loans to the Borrower.

5. The $147,500,000 aggregate initial balanceof the pool of Mortgage Loans consists of 60 newly originatedconventional, fixed rate Mortgage Loans, each of which aresecured by one or more mortgaged properties (collectivelythe "Mortgaged Properties").

6. The Borrower was created under the lawsof the Province of Ontario as a special purpose limited partnershipunder which Summit REIT (CMBS No. 1) Ltd., a corporation incorporatedunder the laws of the Province of Ontario, and wholly ownedby Summit Real Estate Investment Trust ("Summit"),is the sole general partner of the Borrower and of which Summitis also the sole limited partner. Each of the Borrower andthe general partner thereof is a bankruptcy-remote singlepurpose entity. The activities of the Borrower are limitedto matters related to the Mortgaged Properties.

7. The Issuer is, and was at the time it investedin the Mortgage Loans, an "accredited investor"under subsection (t) of that definition in Section 1.1 ofRule 45-501, being a Trust with net assets of at least FiveMillion ($5,000,000) Dollars.

8. The origination of, and investment in,the Mortgage Loans by the Issuer is exempt from the prospectusrequirements pursuant to the prospectus exemption containedin Section 2.3 of Rule 45-501.

9. Unless the relief sought is granted, theBorrower will be required to pay an amount of approximately$29,500 in respect of the borrowing from the Issuer upon thefiling of a Form 45-501F1 relating thereto pursuant to Section7.3 of Rule 45-501.

10. The Issuer has paid filing fees totallingapproximately $49,000 to the Ontario Securities Commissionin connection with the filing of the preliminary (short form)prospectus and the Prospectus qualifying the distributionof the Certificates. The fees were paid pursuant to paragraph13(3)(a) and subsection 18(1) of Schedule I to the Regulationmade under the Act.

AND UPON the Commission being satisfiedthat to do so would not be prejudicial to the public interest;

IT IS ORDERED, pursuant to section 147of the Act, that the Participants are exempt from the requirementto pay the fees applicable to the filing of a Form 45-501F1under section 7.3 of Rule 45-501 in connection with the borrowingof Mortgage Loans by the Borrower.

November 12, 2002.

"Howard I. Wetston"                    "HaroldP. Hands"