Mutual Reliance Review System for Exemptive Relief Applications - Extension of lapse date for mutual fund prospectus to allow for completion of fund mergers and system integration.
Securities Act, R.S.O. 1990 c. S.5, as amended, ss. 62(1), 62(2) and 62(5).
IN THE MATTER OF
THE SECURITIES LEGISLATION OF
BRITISH COLUMBIA, ALBERTA, SASKATCHEWAN,
MANITOBA, ONTARIO, QUEBEC, NEW BRUNSWICK,
NOVA SCOTIA, PRINCE EDWARD ISLAND AND
NEWFOUNDLAND AND LABRADOR
IN THE MATTER OF
THE MUTUAL RELIANCE REVIEW SYSTEM
FOR EXEMPTIVE RELIEF APPLICATION
IN THE MATTER OF
NORTHWEST MUTUAL FUNDS INC.
IN THE MATTER OF
NORTHWEST CANADIAN EQUITY FUND (FORMERLY NORTHWEST GROWTH FUND), NORTHWEST MONEY MARKET
FUND, NORTHWEST BALANCED FUND, NORTHWEST FOREIGN EQUITY FUND (FORMERLY NORTHWEST
INTERNATIONAL FUND), NORTHWEST RSP FOREIGN EQUITY FUND (FORMERLY NORTHWEST RSP INTERNATIONAL
FUND), NORTHWEST SPECIALTY HIGH YIELD BOND FUND, NORTHWEST SPECIALTY EQUITY FUND, AND
NORTHWEST SPECIALTY INNOVATIONS FUND
(collectively, the "Northwest Funds")
MRRS DECISION DOCUMENT
WHEREAS the Canadian securities regulatory authority or regulator (the "Decision Maker") in each of the Provinces of British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Quebec, New Brunswick, Nova Scotia, Prince Edward Island and Newfoundland and Labrador (the "Jurisdictions") has received an application (the "Application") from Northwest Mutual Funds Inc. (the "Manager") and the Northwest Funds for a decision pursuant to the securities legislation of the Jurisdictions (the "Legislation") that the time period prescribed by the legislation for the renewal of the simplified prospectus and annual information form of the units of the Northwest Funds (the "Prospectus") be extended to those time periods that would be applicable if the lapse date for the distribution of units of the Funds was June 11, 2004;
AND WHEREAS pursuant to the Mutual Reliance Review System for Exemptive Relief Applications (the "System"), the Ontario Securities Commission is the principal regulator for this application;
AND WHEREAS it has been represented by the Manager to the Decision Makers that:
1. The Manager is a corporation incorporated under the laws of Ontario. The Manager is the manager, trustee, principal distributor, and promoter of the Northwest Funds.
2. The Northwest Funds are open-ended mutual fund trusts governed by the laws of the Province of Ontario.
3. The Northwest Funds are reporting issuers under the Legislation and are not in default of any requirements of the Legislation or the regulations made thereunder.
4. Pursuant to the Legislation or the regulations made thereunder, the earliest lapse date (the "Lapse Date") for distribution of securities of the Northwest Funds is April 11, 2004.
5. In September 2003, as a result of a transaction with an affiliate of Desjardins Trust Investments Inc. ("Desjardins Trust"), the Manager became an indirect subsidiary of Desjardins Trust. Desjardins Trust is the manager and investment manager of the Maestral Mutual Funds ("the Maestral Funds").
6. The Maestral Funds are open-end mutual fund trusts established under the laws of Québec.
7. The Maestral Funds are currently qualified for distribution in British Columbia, Alberta, Ontario, Québec and New Brunswick under a simplified prospectus and annual information form dated October 29, 2003 as amended by Amendment No. 1 dated December 1, 2003.
8. To avoid duplication of work and costs, Desjardins Trust and the Manager are in the process of integrating the management of the Northwest Funds and the Maestral Funds. In connection with the integration, they are contemplating certain mergers of the Maestral Funds and the Northwest Funds to eliminate duplication of investment objectives in the fund families.
9. Unitholders of the terminating funds and any funds for which the mergers would be a significant change will be asked to approve the applicable merger at special meetings to be held on or about May 14, 2004.
10. The Manager will file an amended and restated prospectus for the Northwest Funds by the Lapse Date.
11. In accordance with the requirements of significant changes for mutual funds, a press release will be issued and filed on SEDAR together with the required amendments to or disclosure in the simplified prospectus and annual information form describing the mergers and other significant changes to the funds, once approved by the Board of Directors of Desjardins Trust and the Manager, as the case may be.
12. An extension of the Lapse Date is required in order to allow sufficient time for completion of the integration, including any mergers and to coordinate the lapse dates for the continuing Northwest Funds and Maestral Funds, as well as to avoid the undue costs associated with filing a renewal simplified prospectus and annual information form in April 2004 for certain Northwest Funds that will be terminated upon completion of any mergers at the end of May, 2004.
AND WHEREAS pursuant to the System this MRRS Decision Document evidences the decision of each Decision Maker (collective, the "Decision");
AND WHEREAS each of the Decision Makers are satisfied that the test contained in the Legislation 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 the time limits provided by Legislation as they apply to a distribution of securities under a prospectus are hereby extended to the time limits that would be applicable if the lapse date for the distribution of securities under the simplified prospectus and annual information form of the Northwest Funds was June 1, 2004 and that the offering of securities of the Northwest Funds may continue provided that a (final) simplified prospectus and annual information form for the Northwest Funds is filed no later than June 11, 2004 and a receipt is obtained no later than June 21, 2004.
February 26, 2004.