Securities Law & Instruments

Headnote

Relief granted to investment fund trust such that interim financial statements will be reviewed by either the Trustee or the Manager, instead of a board of directors.

Applicable Ontario Statutory Provisions

Securities Act, R.S.O. 1990, c. S.5, as am., s. 77(1).

Ontario Securities Commission Rule 52-501, sections 2.2(6) and 2.2(7).

March 9, 2004

Fasken Martineau DuMoulin LLP
66 Wellington Street West
Suite 4200, Toronto Dominion Bank Tower
Box 20. Toronto-Dominion Centre
Toronto, Ontario, Canada
M5K 1N6
 
Attention:
John M. Sabetti

Dear Sirs/Mesdames:

Re:
Maxin Income Fund -- Application dated November 19, 2003 for relief from the interim financial statement review requirements contained in Ontario Securities Commission Rule 52-501

By letter dated November 19, 2003, you have applied on behalf of Maxin Income Fund (the Trust) to the Ontario Securities Commission (the Director) for an exemption, pursuant to section 4.1 of Ontario Securities Commission Rule 52-501 -- Financial Disclosure (the Rule 52-501), that the requirements contained in Sections 2.2(6) and 2.2(7) of the Rule 52-501 that the board of directors or the audit committee of the trust review the interim financial statements (the Review Requirements) shall not apply to the Trust in respect of each set of interim financial statements filed by the Trust pursuant to Section 77(1) of the Securities Act (Ontario) (the Act);

The Trust has represented to the Director that:

1. The Trust is an unincorporated closed-end investment trust established under the laws of the Province of Ontario by a declaration of trust dated as of March 28, 2003 (the Declaration of Trust).

2. The Trust does not have a board of directors, as the Trust is not a corporation. Hence, the Trust cannot comply with the Review Requirements

3. The Trust became a reporting issuer or the equivalent thereof in all of the provinces of Canada and the Yukon Territory on March 28, 2003 upon obtaining a receipt for its final prospectus.

4. The beneficial interests in the Trust are divided into a single class of voting units (Units). The Trust is authorized to issue an unlimited number of Units. The Trust is not considered to be a "mutual fund" as defined in the Act because the holders (Unitholders) of Units are entitled to redeem their Units only once per year.

5. The Units are listed and posted for trading on the Toronto Stock Exchange under the symbol "MXZ.UN". As of November 4, 2003, 8,294,070 Units were issued and outstanding.

6. The investment criteria of the Trust as set forth in the Declaration of Trust provide that the Trust will invest in a portfolio (the Portfolio) of securities comprised of units of business trusts, real estate investment trusts, oil and gas royalty trusts and pipeline and power generation trusts, as well as other high-yielding equity-based securities and cash and cash equivalents.

7. Guardian Capital Inc. and Middlefield Securities Limited have been retained by the Trust to provide investment management advice in respect of the asset mix and securities selection for the Portfolio.

8. There is no current review requirement for mutual funds offered under simplified prospectuses.

9. The Trust meets the definition of a "non-redeemable investment fund" under Ontario Securities Commission Rule 14-501 -- Definitions. Proposed National Instrument 81-106 -- Investment Fund Continuous Disclosure (NI 81-106) will require the manager, the trustee or trustees of a non-redeemable investment fund that is a trust to approve both interim and annual financial statements of the fund, before those financial statements are filed or made available to holders, or potential purchasers, of securities of the fund.

This letter confirms that, based on the information and representations contained in the Application, and for the purposes described in the Application, the Decision Makers hereby exempt the Trust from Sections 2.2(6) and 2.2(7) of Rule 52-501 so that the Review Requirements shall not apply to the Trust, provided that

i) the manager, the trustee or trustees of the Trust review the Trust's interim financial statements before the interim financial statements are filed pursuant to Section 77(1) of the Act, or made available to holders, or potential purchasers, of securities of the Trust, and

ii) this Exemption shall terminate upon NI 81-106 coming into force.

"Leslie Byberg"