Exemption for pooled funds from the requirement to file with the Commission interim financial statements under section 77(2) of the Act and comparative financial statements under section 78(1) of the Act, subject to conditions.
Securities Act, R.S.O. 1990, c. s.5 as am., ss.74(1).
Regulation made under the Securities Act, R.R.O. Reg. 1015, as am.
National Instrument 13-101-- System for Electronic Document Analysis and Retrieval (SEDAR), s. 2.1(1)1.
IN THE MATTER OF
THE SECURITIES ACT (ONTARIO)
R.S.O. 1990, CHAPTER S.5, AS AMENDED (the "Act")
IN THE MATTER OF
ANACLE I CORPORATION
(Section 147 of the Act)
UPON the application (the "Application") of Anacle I Corporation ("Anacle"), to the Ontario Securities Commission (the "Commission") for an order pursuant to section 147 of the Act exempting the Non-ASIC Classes (as defined below) from the Financial Statement Filing Requirements (as defined below).
AND UPON considering the Application and the recommendation of the staff of the Commission;
AND UPON Anacle having represented to the Commission as follows:
1. Anacle is a corporation amalgamated under the laws of Ontario.
2. In connection with the proposed distribution in Ontario by Anacle of Series A shares of Anacle Short-Term Investment Class ("ASIC"), one of the classes of Anacle shares, Anacle has filed on the System for Electronic Document Analysis and Retrieval ("SEDAR") a simplified prospectus and an annual information form, each dated November 4, 2004 (the "Ontario prospectus documents"). Anacle has also filed a separate preliminary simplified prospectus and annual information form in respect of the Series A Shares of ASIC in Manitoba and British Columbia, which are virtually identical to the Ontario prospectus documents, on December 17, 2004.
3. Anacle intends to be a "mutual fund corporation" under the Income Tax Act (Canada) after it has distributed Series A shares of ASIC to at least 300 purchasers.
4. There are currently four additional Anacle funds, each of which is a separate class of Anacle shares and a "mutual fund" under subsection 1(1) of the Act (the "Existing Non-ASIC Classes"). From time to time, Anacle may create similar classes for additional funds (together with the Existing Non-ASIC Classes, the "Non-ASIC Classes"). Each Non-ASIC Class has or will have a separate portfolio of assets referable to it.
5. The Existing Non-ASIC Classes are owned entirely by M.R.S. Trust Company ("MRS"). The Non-ASIC Classes have been and will be distributed on a prospectus-exempt basis only to MRS and/or one or more of its affiliates that do not have any direct public shareholders.
6. Accordingly, none of the Non-ASIC Classes is or will be a "reporting issuer" under subsection 1(1) of the Act.
7. However, by virtue of Anacle being organized under the laws of Ontario, each of the Non-ASIC Classes is or will be a "mutual fund in Ontario" under subsection 1(1) of the Act. They will not have a corresponding status in Manitoba or British Columbia.
8. As mutual funds in Ontario, absent the relief requested, each of the Non-ASIC Classes is or will be required to prepare and file semi-annual and audited annual financial statements and send copies of such financial statements to the holder(s) of the Non-ASIC Classes in accordance with subsections 77(2), 78(1), and 79(1) of the Act (the "Financial Statement Requirements").
9. Absent the relief requested, the filings are or will be required to be posted on SEDAR, pursuant to subsection 2.1(1) of National Instrument 13-101 -- System for Electronic Document Analysis and Retrieval (the "SEDAR Rule").
10. Anacle will prepare semi-annual and audited annual financial statements for ASIC, send such financial statements to the holders of ASIC shares, and file such financial statements for ASIC on SEDAR in accordance with the Financial Statement Requirements and the SEDAR Rule.
AND UPON the Commission being satisfied that it would not be prejudicial to the public interest to do so;
IT IS HEREBY ORDERED THAT, pursuant to subsection 147 of the Act, the Non-ASIC Classes are exempt from the Financial Statement Requirements provided:
(a) Anacle prepares semi-annual and audited annual financial statements for Anacle on a legal entity basis and in accordance with Canadian generally accepted accounting principles; and
(b) The only shareholders of the Non-ASIC Classes are MRS and affiliates of MRS that do not have any direct public shareholders.
January 18, 2005.
"Robert W. Davis"