Armtec Infrastructure Income Fund - MRRS Decision

Headnote

Mutual Reliance Review System for Exemptive Relief Applications -- Relief granted from the requirement to file certain financial statements with a business acquisition report provided that the business acquisition report will include the financial statements pertaining to the acquired business that were included in a final prospectus.

Rules Cited

National Instrument 51-102 -- Continuous Disclosure Obligations, Part 8.

October 6, 2004

IN THE MATTER OF

THE SECURITIES LEGISLATION

OF ALBERTA, SASKATCHEWAN, MANITOBA, ONTARIO,

QUÉBEC, NEW BRUNSWICK, NOVA SCOTIA

AND NEWFOUNDLAND AND LABRADOR (the Jurisdictions)

AND

IN THE MATTER OF

THE MUTUAL RELIANCE REVIEW SYSTEM

FOR EXEMPTIVE RELIEF APPLICATIONS

AND

IN THE MATTER OF

ARMTEC INFRASTRUCTURE INCOME FUND (the Filer)

MRRS DECISION DOCUMENT

Background

The local securities regulatory authority or regulator (the Decision Maker) in each of the Jurisdictions has received an application from the Filer for: (i) a decision under the securities legislation of the Jurisdictions (the Legislation) for an exemption from the requirement that certain financial statements prescribed by section 8.4 of National Instrument 51-102 (NI 51-102) be filed with the business acquisition report prepared by the Filer in connection with the Filer's acquisition of all of the securities and assets of Armtec Holdings Limited (Armtec) and (ii) in Quebec, for a revision of the general order that will provide the same result as an exemption order (the Requested Relief).

Under the Mutual Reliance Review System for Exemptive Relief Applications

(a) the Ontario Securities Commission is the principal regulator for this application, and

(b) the MRRS decision document evidences the decision of each Decision Maker.

Interpretation

Defined terms contained in National Instrument 14-101 Definitions have the same meaning in this decision unless they are defined in this decision.

Representations

This decision is based on the following facts represented by the Filer:

1. The Filer is a trust established and governed pursuant to a declaration of trust dated June 15, 2004, as amended and restated on July 27, 2004.

2. The Filer's head office is located at 15 Campbell Road, Guelph, Ontario N1H 6H1.

3. The Filer is a reporting issuer, or the equivalent, in each of the Jurisdictions and, to the best of its knowledge, is currently not in default of any applicable requirements under the Legislation.

4. Although the Filer is also a reporting issuer, or the equivalent, in Prince Edward Island, an application is not being made to the securities regulatory authority in this province as NI 51-102 has not been adopted in this jurisdiction.

5. Although the Filer is also a reporting issuer in British Columbia, an application is not being made in this province as BC Implementing Rule 51-801 exempts issuers from Part 8 of NI 51-102 in British Columbia.

6. On June 18, 2004, the Filer filed a preliminary prospectus (the Preliminary Prospectus) in all of the provinces of Canada in connection with the initial public offering (IPO) of trust units (Units) of the Filer. The proceeds of the IPO were intended to finance the acquisition (the Acquisition) of all of the securities and assets of Armtec.

7. On July 19, 2004, the Filer filed its final prospectus (the Prospectus) in all of the provinces of Canada in connection with the IPO, qualifying 9,015,000 Units for total gross proceeds of CDN$90,150,000.

8. On July 27, 2004, the Filer completed the IPO and the Acquisition.

9. The Units are listed on the Toronto Stock Exchange. As at the date hereof, the Filer has 9,015,000 Units issued and outstanding.

10. The Acquisition constitutes a "significant acquisition" of the Filer for the purposes of NI 51-102, requiring the Filer to file a business acquisition report on or before October 10, 2004 pursuant to section 8.2 of NI 51-102.

11. Ontario Securities Commission Rule 41-501, and the equivalent thereof of the other provincial securities regulatory authorities (collectively, the Rules) set out the financial statements required to be included in a prospectus, including financial statements relating to "significant acquisitions".

12. Compliance with the financial statement requirements in the Rules does not necessarily satisfy the financial statement requirements in section 8.4 of NI 51-102.

13. The Prospectus was filed 8 days prior to the closing of the Acquisition. Both the Preliminary Prospectus and the Prospectus included consolidated financial statements of Armtec for the four months ended April 30, 2004 and 2003 (unaudited), the years ended December 31, 2003 and 2002 (audited), the period from August 17, 2001 to December 31, 2001 (audited) and the period from January 1, 2001 to August 16, 2001 (unaudited) and the pro forma financial statements of the Filer as at and for the four months ended April 30, 2004 (unaudited) and the year ended December 31, 2003 (unaudited) (collectively, the Prospectus Financial Statements).

Decision

Each of the Decision Makers is satisfied that the test contained in the Legislation provides the Decision Maker with the jurisdiction to make the decision has been met.

The decision of the Decision Makers under the Legislation is that the Requested Relief is granted provided that the business acquisition report filed by the Filer includes the Prospectus Financial Statements.