Securities Law & Instruments


Rule 61-501 - going private transactions - payments to be to a 1.7% shareholder under terms of consulting agreement made for reasons other than to increase the value of the consideration paid to the shareholder under proposed going private transaction - amount payable under consulting agreement represents approximately 4.3% of total consideration payable to shareholder - payments not conditional on support of transaction and reasonably consistent with customary industry practice - shareholder permitted to vote his holding of common shares as part of minority vote required in connection with going private transaction.

Applicable Ontario Rules

Rule 61-501 - Insider Bids, Issuer Bids, Going Private Transactions and Related Party Transactions, ss. 4.7, 4.8 and 9.1.













WHEREAS the local securities regulatory authority or regulator (the "Decision Maker") in each of the Provinces of Ontario and Québec (the "Jurisdictions") has received an application (the "Application") from SMK Speedy International Inc. (the "Filer") for a decision under Ontario Securities Commission Rule 61-501 -- Insider Bids, Issuer Bids, Going Private Transactions and Related Party Transactions ("Rule 61-501") and Policy Q-27 of the Commission des valeurs mobilières du Québec (collectively, the "Legislation") that Bryan H. Held ("Mr. Held") be permitted to vote his holdings of common shares of the Filer (the "Common Shares") and eligible stock options ("SMK Eligible Options") as part of the minority vote required in connection with the proposed going private transaction to be accomplished by way of a plan of arrangement (the "Arrangement") involving the Filer, 2036407 Ontario Inc. ("Acquisitionco") and 578098 Alberta Ltd. ("Minute Muffler"), notwithstanding the consulting agreement (the "Consulting Agreement") pursuant to which Held will receive cash payments for providing consulting services after completion of the Arrangement;

AND WHEREAS under the Mutual Reliance Review System for Exemptive Relief Applications (the "System"), the Ontario Securities Commission is the principal regulator for this application;

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

AND WHEREAS the Filer has represented to the Decision Makers that:

1. The Filer is incorporated under the Business Corporations Act (Ontario).

2. The Filer is a reporting issuer or the equivalent in all the provinces and territories of Canada and is not currently in default of the securities legislation in such jurisdictions.

3. The Filer is a leading automobile service specialist with 123 stores in Canada and six stores in the Republic of Korea. The Filer operates pursuant to a licensing agreement and specializes in "no appointment, while-you-wait service" in respect of brakes, exhaust, oil changes, maintenance, road handling, steering systems and tires for all makes of cars and light trucks.

4. The head office of the Filer is located at 365 Bloor Street East, Suite 1100, Toronto, Ontario, M4W 3M7.

5. The authorized capital of the Filer consists of an unlimited number of Common Shares, of which 13,907,775 Common Shares were outstanding (fully diluted to include all in-the-money SMK Eligible Options) as of the date hereof, and an unlimited number of non-voting preferred shares, none of which are outstanding as of the date hereof.

6. The Common Shares are listed on the Toronto Stock Exchange under the symbol "SMK".

7. As of the date hereof, The Goldfarb Corporation holds 6,736,275 Common Shares, representing approximately 48.4% of the outstanding securities of the Filer entitled to vote at the shareholders' meeting (the "Meeting") to be held on January 5, 2004 to approve the Arrangement.

8. Pursuant to a support agreement among The Goldfarb Corporation, Acquisitionco and Minute Muffler dated December 2, 2003, which the parties thereto negotiated at arm's length, The Goldfarb Corporation agreed, subject to certain conditions, to vote the 6,736,275 Common Shares held by it for approval of the Arrangement at the Meeting.

9. The Arrangement constitutes a "going private transaction" under the Legislation and consequently is subject to the formal valuation and minority approval requirements of the Legislation.

10. The Arrangement is exempt from the valuation requirements in respect of "going private transactions" under the Legislation.

11. Mr. Held is currently the President and Chief Executive Officer of the Filer and has been a director of the Filer since 1999.

12. As of December 5, 2003, Mr. Held owned 54,000 Common Shares and 180,000 SMK Eligible Options that may be acquired under the Arrangement. As such, as of December 5, 2003, Mr. Held owned 234,000 securities of the Filer entitled to vote in respect of the Arrangement at the Meeting, or approximately 1.7% of the aggregate outstanding securities of the Filer eligible to vote at the Meeting.

13. Upon completion of the Arrangement, Mr. Held proposes to enter into the Consulting Agreement with Minute Muffler and a wholly-owned subsidiary of Minute Muffler to be formed by the amalgamation of the Filer and Acquisitionco ("Amalco").

14. The principal purpose of the Consulting Agreement is for Mr. Held to assist in the transition of the business of Amalco following the Arrangement. Mr. Held has been an integral part of the Filer's business and has substantial and valuable experience and expertise in the automobile service industry.

15. Pursuant to the terms of the Consulting Agreement, Mr. Held will be paid $500 per hour of consulting services provided. The Consulting Agreement limits the number of hours of consulting services per month to a maximum of 80 and provides for payment to Mr. Held of a minimum monthly retainer of $30,000. The Consulting Agreement will expire on the earlier of six months following its execution or ten days after either Mr. Held or Amalco deliver to the other party written notice of the termination of the Consulting Agreement. If terminated by Amalco, Mr. Held is entitled to receive the lesser of $120,000 and the product of $30,000 multiplied by the number of months remaining in the term of the Consulting Agreement.

16. Mr. Held is an interested party within the meaning of the Legislation because he will receive payments under the Consulting Agreement that will not be offered to any other holder of Common Shares.

17. Pursuant to the terms of the Consulting Agreement, the maximum amount of compensation that Mr. Held is eligible to receive is $240,000. In the event that the Arrangement does not proceed, Mr. Held is to continue to receive from the Filer an annual salary of $300,000 and benefits valued at approximately $60,000 per annum. As such, under the Consulting Agreement, Mr. Held will receive, at most, $60,000 more than he would otherwise receive from the Filer during the first six months of 2004, such amount representing approximately 4.3% of the total consideration that Mr. Held will receive from Acquisitionco in consideration for the acquisition of the Common Shares and SMK Eligible Options of the Filer held by him.

18. The compensation to be provided to Mr. Held pursuant to the Consulting Agreement is reasonable in light of the services to be rendered to Amalco by Mr. Held and is consistent with current market conditions.

19. The Consulting Agreement has been negotiated by Minute Muffler and Mr. Held at arm's length and is made on commercially reasonable terms and is reasonably consistent with customary industry practice.

20. The Consulting Agreement is not conditional upon Mr. Held supporting the Arrangement in any manner.

21. The Consulting Agreement is being made for valid business purposes unrelated to Mr. Held's securityholdings in the Filer and not for the purpose of providing Mr. Held with greater consideration for his securityholdings than the consideration to be paid to other security holders of the Filer for their securities of the Filer under the Arrangement.

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

AND WHEREAS each of the Decision Makers is satisfied that the test contained in the Legislation of the Jurisdictions that provides the Decision Maker with the jurisdiction to make the Decision has been met;

THE DECISION of the Decision Makers pursuant to the Legislation is that Mr. Held shall be permitted to vote his holding of Common Shares and Eligible Stock Options as part of the minority vote required in connection with the Arrangement, provided that the Filer complies with the other applicable provisions of the Legislation.

December 30, 2003.

"John Hughes"