CIBC Asset Management Inc. and Tal Global Asset Management Inc. - MRRS Decision

Headnote

Standard exemption from subsection 4.1(1) of National Instrument 81-102 Mutual Funds (NI 81-102) to enable the Dealer Managed Fund, as defined in section 1.1 of NI 81-102, to invest in the shares of an issuer during the 60 days after the period in which an affiliate of the Dealer Manager, as defined in section 1.1 of NI 81-102, has acted as an underwriter in connection with an offering of trust units by the issuer.

Rule Cited

National Instrument 81-102 Mutual Funds, subsection 4.1(1) and section 19.1.

December 20, 2005

IN THE MATTER OF

THE SECURITIES LEGISLATION OF

BRITISH COLUMBIA, ALBERTA, SASKATCHEWAN, MANITOBA,

ONTARIO, QUEBEC, NEW BRUNSWICK, NOVA SCOTIA,

PRINCE EDWARD ISLAND, NEWFOUNDLAND AND LABRADOR,

AND THE NORTHWEST TERRITORIES, NUNAVUT AND THE YUKON

(the "Jurisdictions")

AND

IN THE MATTER OF

THE MUTUAL RELIANCE REVIEW SYSTEM FOR

EXEMPTIVE RELIEF APPLICATIONS

AND

IN THE MATTER OF

CIBC ASSET MANAGEMENT INC. AND

TAL GLOBAL ASSET MANAGEMENT INC. (the "Applicants")

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 Applicants (or "Dealer Managers"), for and on behalf of the mutual funds named in Appendix "A" (the "Funds" or "Dealer Managed Funds") for whom the Applicants act as manager or portfolio advisor or both, for a decision under section 19.1 of National Instrument 81-102 Mutual Funds ("NI 81-102") (the "Legislation") for:

• an exemption from subsection 4.1(1) of NI 81-102 to enable the Dealer Managed Funds to invest in the Trust Units (the "Units") of Trinidad Energy Services Income Trust (the "Issuer") on the Toronto Stock Exchange (the "TSX") during the 60-day period following the completion of the Distribution (the "Prohibition Period") notwithstanding that the Dealer Managers or their associates or affiliates act or have acted as an underwriter in connection with the offering (the "Offering") of Units of the Issuer pursuant to a preliminary short form prospectus filed by the Issuer and a final short form prospectus that the Issuer will file in accordance with the securities legislation of each of the Provinces (the "Requested Relief").

Under the Mutual Reliance Review System for Exemptive Relief Applications:

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

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

It is the responsibility of each of the Decision Makers to make a global assessment of the risks involved in granting exemptive relief from subsection 4.1 of NI 81-102 in relation to the specific facts of each application.

Interpretation

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

Representations

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

1. Each Dealer Manager is a "dealer manager" with respect to the Dealer Managed Funds, and each Dealer Managed Fund is a "dealer managed fund", as such terms are defined in section 1.1 of NI 81-102.

2. The securities of the Dealer Managed Funds are qualified for distribution in one or more of the provinces and territories of Canada pursuant to simplified prospectuses that have been prepared and filed in accordance with their respective securities legislation.

3. According to the Preliminary Prospectus, the Offering is to be for approximately 10,666,667 Units at an offering price of $15.00 per Unit. The gross proceeds of the Offering are expected to be approximately $160,000,005. According to the Preliminary Prospectus, the Issuer has granted the underwriters an option (the "Option") to increase the size of the Offering by and up to a further 2,666,667 Units exercisable up until the day preceding closing of the Offering which is expected to occur on or about December 20, 2005 (the "Closing") but in any event no later than December 30, 2005. If the Option is exercised in full, the total gross proceeds of the Offering shall be approximately $190,000,010.

4. In addition to CIBC World Markets Inc. (the "Related Underwriter"), the underwriters of the Offering include Raymond James Ltd., TD Securities Ltd., BMO Nesbitt Burns Inc., Blackmont Capital Inc., Wellington West Capital Markets Inc., Haywood Securities Inc., and Sprott Securities Inc.

5. The Issuer is an open-ended unincorporated investment trust governed by the laws of the Province of Alberta. The issuer was created to engage, through its subsidiary Trinidad Drilling L.P., in the business of providing drilling related equipment and services to oil and gas exploration and production companies that operate in western Canada.

6. As described in the Preliminary Prospectus, the net proceeds from the Offering will be used to indirectly fund a portion of the acquisition of assets by Trinidad Drilling L.P. from Cheyenne Drilling L.P. The purchased assets include 20 drilling rigs currently owned by Cheyenne Drilling L.P. and other related equipment. In the event that the underwriters exercise the Option, the balance of the net proceeds will be used for general working capital purposes.

7. The Issuer and the underwriters will enter into an underwriting agreement (the "Underwriting Agreement") in respect of the Offering. Pursuant to the terms of the Underwriting Agreement, the underwriters will severally (and not jointly) agree to purchase, all but not less than all of the Units offered under the Offering from the Issuer, as principal, on Closing.

8. The Preliminary Prospectus states that the Issuer shall not issue any additional Units or financial instruments convertible into Units, or disclose any intention to do so until a period of at least 90 days following Closing, unless it obtains the consent of the Raymond James Ltd., which consent shall not be unreasonably withheld.

9. The Issuer's outstanding Units are listed on the TSX under the symbol "TGD.UN" and the Issuer has applied to list the Units offered in the Offering on the TSX, such listing to be subject to fulfilling the requirements of the TSX.

10. According to the Preliminary Prospectus, TD Securities Inc. is a "connected issuer" as such term is defined in National Instrument 33-105 -- "Underwriting Conflicts" ("NI 33-105"). The Preliminary Prospectus does not disclose that the Issuer is a "connected issuer" or a "related issuer" of the Related Underwriter pursuant to NI 33-105.

11. Despite the affiliation between the Dealer Managers and the Related Underwriter, they operate independently of each other. In particular, the investment banking and related dealer activities of the Related Underwriter and the investment portfolio management activities of the Dealer Managers are separated by "ethical" walls. Accordingly, no information flows from one to the other concerning their respective business operations or activities generally, except in the following or similar circumstances:

(a) in respect of compliance matters (for example, the Dealer Managers and the Related Underwriter may communicate to enable the Dealer Managers to maintain up to date restricted-issuer lists to ensure that the Dealer Managers comply with applicable securities laws); and

(b) each Dealer Manager and the Related Underwriter may share general market information such as discussion on general economic conditions, bank rates, etc.

12. The Dealer Managed Funds are not required or obligated to purchase any Units during the Prohibition Period.

13. The Dealer Managers may cause the Dealer Managed Funds to invest in the Units during the Prohibition Period. Any purchase of the Units will be consistent with the investment objectives of the Dealer Managed Fund making the purchase and represent the business judgment of the Dealer Managers uninfluenced by considerations other than the best interests of the Dealer Managed Fund or in fact be in the best interests of the Dealer Managed Fund.

14. To the extent that the same portfolio manager or team of portfolio managers of a Dealer Manager manages two or more Dealer Managed Funds and other client accounts that are managed on a discretionary basis (the "Managed Accounts"), the Units purchased for them will be allocated:

(a) in accordance with the allocation factors or criteria stated in the written policies or procedures put in place by the Dealer Manager for its Dealer Managed Funds and Managed Accounts, and

(b) taking into account the amount of cash available to each Dealer Managed Fund for investment.

15. There will be an independent committee (the "Independent Committee") appointed in respect of the Dealer Managed Funds to review the Dealer Managed Funds' investments in the Units during the Prohibition Period.

16. The Independent Committee will have at least three members and every member must be independent. A member of the Independent Committee is not independent if the member has a direct or indirect material relationship with its Dealer Manager, the Dealer Managed Funds, or any affiliate or associate thereof. For the purpose of this Decision, a material relationship means a relationship which could, in the view of a reasonable person, reasonably interfere with the exercise of the member's independent judgment regarding conflicts of interest facing the Dealer Manager.

17. The members of the Independent Committee will exercise their powers and discharge their duties honestly, in good faith, and in the best interests of investors in the Dealer Managed Funds and, in so doing, exercise the degree of care, diligence and skill that a reasonably prudent person would exercise in the circumstances.

18. Each Dealer Manager, in respect of the Dealer Managed Funds, will notify a member of staff in the Investment Funds Branch of the Ontario Securities Commission, in writing of any SEDAR Report (as defined below) filed on SEDAR, as soon as practicable after the filing of such a report, and the notice shall include the SEDAR project number of the SEDAR Report and the date on which it was filed.

19. Each Dealer Manager has not been involved in the work of the Related Underwriter and the Related Underwriter has not been and will not be involved in the decisions of the Dealer Managers as to whether the Dealer Manager's Dealer Managed Funds will purchase Units during the Prohibition Period.

Decision

Each of the Decision Makers has assessed the conflict of interest risks associated with granting an exemption in this instance from subsection 4.1(1) of NI 81-102 and is satisfied that, at the time this Decision is granted, the potential risks are sufficiently mitigated.

Each of the Decision Makers is satisfied that the test contained in the NI 81-102 that 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, notwithstanding that the Related Underwriters act or have acted as underwriters in the Offering provided that, in respect of the Dealer Managers and its Dealer Managed Funds, the following conditions are satisfied:

I. At the time of each purchase (the "Purchase") of Units by a Dealer Managed Fund pursuant to this Decision, the following conditions are satisfied:

(a) the Purchase

(i) represents the business judgment of the Dealer Manager uninfluenced by considerations other than the best interests of the Dealer Managed Fund, or

(ii) is, in fact, in the best interests of the Dealer Managed Fund;

(b) the Purchase is consistent with, or is necessary to meet, the investment objective of the Dealer Managed Fund as disclosed in its simplified prospectus; and

(c) the Dealer Managed Fund does not place the order to purchase, on a principal or agency basis, with its Related Underwriter;

II. Prior to effecting any Purchase pursuant to this Decision, the Dealer Managed Fund has in place written policies or procedures to ensure that,

(a) there is compliance with the conditions of this Decision; and

(b) in connection with any Purchase,

(i) there are stated factors or criteria for allocating the Units purchased for two or more Dealer Managed Funds and other Managed Accounts, and

(ii) there is full documentation of the reasons for any allocation to a Dealer Managed Fund or Managed Account that departs from the stated allocation factors or criteria;

III. The Dealer Manager does not accept solicitation by its Related Underwriter for the Purchase of Units for the Dealer Managed Funds;

IV. Each Dealer Managed Fund has an Independent Committee to review the Dealer Managed Funds' investments in the Units during the Prohibition Period;

V. The Independent Committee has a written mandate describing its duties and standard of care which, as a minimum, sets out the conditions of this Decision;

VI. The members of the Independent Committee exercise their powers and discharge their duties honestly, in good faith, and in the best interests of investors in the Dealer Managed Funds and, in so doing, exercise the degree of care, diligence and skill that a reasonably prudent person would exercise in the circumstances;

VII. The Dealer Managed Fund does not relieve the members of the Independent Committee from liability for loss that arises out of a failure to satisfy the standard of care set out in paragraph VI above;

VIII. The Dealer Managed Fund does not incur the cost of any portion of liability insurance that insures a member of the Independent Committee for a liability for loss that arises out of a failure to satisfy the standard of care set out in paragraph VI above;

IX. The cost of any indemnification or insurance coverage paid for by the Dealer Manager, any portfolio manager of the Dealer Managed Funds, or any associate or affiliate of each Dealer Manager or any portfolio manager of the Dealer Managed Funds to indemnify or insure the members of the Independent Committee in respect of a loss that arises out of a failure to satisfy the standard of care set out in paragraph VI above is not paid either directly or indirectly by the Dealer Managed Funds;

X. The Dealer Manager files a certified report on SEDAR (the "SEDAR Report") in respect of each Dealer Managed Fund, no later than 30 days after the end of the Prohibition Period, that contains a certification by the Dealer Manager that contains:

(a) the following particulars of each Purchase:

(i) the number of Units purchased by the Dealer Managed Funds;

(ii) the date of the Purchase and purchase price;

(iii) whether it is known whether any underwriter or syndicate member has engaged in market stabilization activities in respect of the Units;

(iv) if the Units were purchased for two or more Dealer Managed Funds and other Managed Accounts of the Dealer Manager, the aggregate amount so purchased and the percentage of such aggregate amount that was allocated to each Dealer Managed Fund; and

(v) the dealer from whom the Dealer Managed Fund purchased the Units and the fees or commissions, if any, paid by the Dealer Managed Fund in respect of such Purchase;

(b) a certification by the Dealer Manager that the Purchase:

(i) was made free from any influence by the Related Underwriter or any affiliate or associate thereof and without taking into account any consideration relevant to the Related Underwriter or any associate or affiliate thereof; and

(ii) represented the business judgment of the Dealer Manager uninfluenced by considerations other than the best interest of the Dealer Managed Fund, or

(iii) was, in fact, in the best interests of the Dealer Managed Fund;

(c) confirmation of the existence of the Independent Committee to review the Purchase of the Units by the Dealer Managed Funds, the names of the members of the Independent Committee, the fact that they meet the independence requirements set forth in this Decision, and whether and how they were compensated for their review;

(d) a certification by each member of the Independent Committee that after reasonable inquiry the member formed the opinion that the policies and procedures referred to in Condition II(a) above are adequate and effective to ensure compliance with this Decision and that the decision made on behalf of each Dealer Managed Fund by the Dealer Manager to purchase Units for the Dealer Managed Funds and each Purchase by the Dealer Managed Fund:

(i) was made in compliance with the conditions of this Decision;

(ii) was made by the Dealer Manager free from any influence by the Related Underwriter or any affiliate or associate thereof and without taking into account any consideration relevant to the Related Underwriter or any associate or affiliate thereof; and

(iii) represented the business judgment of the Dealer Manager uninfluenced by considerations other than the best interests of the Dealer Managed Fund, or

(iv) was, in fact, in the best interests of the Dealer Managed Fund.

XI. The Independent Committee advises the Decision Makers in writing of:

(a) any determination by it that the condition set out in paragraph X(d) has not been satisfied with respect to any Purchase of the Units by a Dealer Managed Fund;

(b) any determination by it that any other condition of this Decision has not been satisfied;

(c) any action it has taken or proposes to take following the determinations referred to above; and

(d) any action taken, or proposed to be taken, by the Dealer Manager or a portfolio manager of a Dealer Managed Fund, in response to the determinations referred to above.

XII. Each Purchase of Units during the Prohibition Period is made on the TSX; and

XIII. An underwriter provides to the Dealer Manager written confirmation that the "dealer restricted period" in respect of the Offering, as defined in Ontario Securities Commission Rule 48-501, Trading During Distributions, Formal Bids and Share Exchange Transactions, has ended.

APPENDIX A

THE MUTUAL FUNDS

Imperial Pools

Imperial Canadian Equity Pool

Imperial Canadian Dividend Income Pool

Imperial Canadian Dividend Pool

Imperial Canadian Income Trust Pool

Renaissance Talvest Mutual Funds

Talvest Dividend Fund

Talvest Cdn. Equity Growth Fund

Talvest Cdn. Asset Allocation Fund

Talvest Global Asset Allocation Fund

Talvest Cdn. Equity Value Fund

Talvest Small Cap Canadian Equity Value Fund

Renaissance Canadian Balanced Value Fund

Renaissance Canadian Dividend Income Fund

Renaissance Canadian Growth Fund

Renaissance Canadian Core Value Fund

Renaissance Canadian Income Trust Fund

Renaissance Canadian Income Trust Fund II

Renaissance Canadian Small Cap Fund

CIBC Mutual Funds

CIBC Balanced Fund

CIBC Core Canadian Equity Fund

CIBC Capital Appreciation Fund

CIBC Dividend Fund

CIBC Financial Companies Fund

Canadian Imperial Equity Fund

CIBC Canadian Small Companies Fund

CIBC Monthly Income Fund

CIBC Diversified Income Fund

Frontiers® Pools

Frontiers Canadian Equity Pool

Frontiers Canadian Monthly Income Pool