The Canadian Professionals Services Trust

Decision

Headnote

National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- exemption granted from the prospectus requirement in connection with distributions of units in the Filer to any officer who is designated by the administrator of the Filer to be a Qualified Officer subject to certain conditions.

Applicable Legislative Provisions

Securities Act, R.S.O. 1990, c. S.5, as am., ss. 53, 74(1).

Citation: The Canadian Professionals Services Trust , Re, 2011 ABASC 22

 

January 14, 2011

IN THE MATTER OF

THE SECURITIES LEGISLATION OF

ALBERTA AND ONTARIO

(the Jurisdictions)

AND

IN THE MATTER OF

THE PROCESS FOR EXEMPTIVE RELIEF

APPLICATIONS IN MULTIPLE JURISDICTIONS

AND

IN THE MATTER OF

THE CANADIAN PROFESSIONALS SERVICES TRUST

(the Filer)

DECISION

Background

The securities regulatory authority or regulator in each of the Jurisdictions (the Decision Maker) has received an application (the Application) from the Filer for a decision under the securities legislation of the Jurisdictions (the Legislation) that the Filer be exempted from the requirement contained in the Legislation to file a prospectus in connection with distributions of units in the Filer (the Filer Units) made pursuant to an offering memorandum (Offering Memorandum) to any individual who has been duly appointed an officer of Bennett Jones Services Inc. (the Administrator) and who is designated by the Administrator to be a qualified officer (Qualified Officer) (the Exemption Sought).

Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a coordinated review application):

(a) the Alberta Securities Commission is the principal regulator for the Application; and

(b) the decision is the decision of the principal regulator and evidences the decision of each other Decision Maker.

Interpretation

Terms defined in National Instrument 14-101 Definitions have the same meaning if used in this decision, unless otherwise defined herein.

Representations

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

1. Bennett Jones LLP (Bennett Jones) is a limited liability partnership registered in Alberta on 12 June 2000 and extra-provincially registered in Ontario on 5 March 2001.

2. Bennett Jones is not a reporting issuer and will not become a reporting issuer in any jurisdiction.

3. The Administrator was incorporated pursuant to the Business Corporations Act (Alberta) on 15 June 2001.

4. The Administrator is not a reporting issuer and will not become a reporting issuer in any jurisdiction.

5. The authorized capital of the Administrator consists of an unlimited number of common shares and its sole shareholder is Bennett Jones.

6. The Administrator is the general partner of Bennett Jones Services Company (the Services Partnership), an Alberta limited partnership.

7. The Filer was formed as an open-ended unincorporated investment trust pursuant to a trust indenture dated 31 July 2001 between the Administrator and the trustee of the Filer (the Trust Indenture).

8. The Filer is the limited partner of the Services Partnership.

9. The Filer is not a reporting issuer and will not become a reporting issuer in any jurisdiction.

10. The Filer's securities are not listed on any exchange and do not trade over-the-counter.

11. The Trust Indenture provides that the Filer may distribute for cash a minimum of 155,000 Filer Units and a maximum of 500,000,000 Filer Units.

12. Prior to 23 October 2010, the Trust Indenture provided that the Filer may distribute Filer Units to subscribers who are one or more of: (i) an individual partner of Bennett Jones, (ii) an individual who is the sole shareholder of a corporate partner of Bennett Jones, (iii) if so designated by the Administrator, the Chief Financial and Administrative Officer of the Administrator (the Officer), (iv) the spouse of an individual partner of Bennett Jones or of an individual who is the sole shareholder of a corporate partner of Bennett Jones, or, if so designated by the Administrator, the spouse of the Officer; or (v) a registered retirement savings plan, registered retirement income fund or deferred profit sharing plan, all within the meaning of the Income Tax Act (Canada) (a Retirement Plan) or trust of which any of the individuals specified in (i), (ii), (iii) or (iv) or an adult child of any of the individuals specified in (i), (ii) or (iii) are the sole beneficial owners (Qualified Persons).

13. The Trust Indenture provides that Filer Units will not be distributed at any time to any person who is not a Qualified Person.

14. Under the Trust Indenture, if a Qualified Person ceases to be so qualified, that person must transfer, or will be deemed to have transferred, the Filer Units held by that person as directed by an Officer, and such Filer Units will be allocated, on a pro rata basis, to the other holders of Filer Units (Unitholders), or the Filer may redeem and cancel such Filer Units.

15. Pursuant to a 27 July 2001 decision of the Decision Makers, the registration requirement and the prospectus requirement under the Legislation do not apply to distributions of Filer Units to Qualified Persons (the Previous Decision).

16. At the time of the Previous Decision, the position of Officer was held by one individual.

17. The individual who previously held the position of Officer left the employment of the Administrator on 26 January 2009. Following his departure, the position of Chief Financial and Administrative Officer was split into two separate positions, Chief Financial Officer and Chief Administrative Officer, which positions are now held by two separate individuals who were appointed to their positions on 30 January 2009.

18. The Trust Indenture was amended on 23 October 2010, such that the definition of "Officer" in the Trust Indenture now includes any individual who has been duly appointed an officer of the Administrator (the Amendment).

19. As a result of the Amendment, Qualified Officers, a Qualified Officer's spouse, the Retirement Plan or trust of a Qualified Officer, the Retirement Plan or trust of a Qualified Officer's spouse and the Retirement Plan or trust of which an adult child of a Qualified Officer or a Qualified Officer's spouse are the sole beneficial owners are now included in the definition of Qualified Persons (Amended Qualified Persons).

20. The Chief Financial Officer and the Chief Administrative Officer are Qualified Officers.

21. In January of each year, additional Filer Units may be distributed for cash to Amended Qualified Persons.

22. In January of each year Filer Units may be transferred and reallocated among Amended Qualified Persons or be redeemed by the Filer.

23. Participation in a distribution of Filer Units by an Amended Qualified Person will be voluntary.

24. Each year, Bennett Jones prepares an Offering Memorandum, which contains disclosure describing the Filer, the terms and conditions of the Filer Units and the investment by the Filer in the Services Partnership and stating that the subscriber will have a contractual right of action as defined in the Legislation.

Decision

Each of the Decision Makers is satisfied that the decision meets the test set out in the Legislation for the Decision Maker to make the decision.

The Decision of the Decision Makers under the Legislation is that the Exemption Sought is granted provided that:

(a) any subsequent trade in Filer Units distributed in accordance with this Decision satisfies subsection 2.5(2) of National Instrument 45-102 Resale of Securities unless such trade is made to the Filer or an Amended Qualified Person;

(b) the Filer provides a copy of this Decision to each Qualified Officer;

(c) the Filer provides a copy of the relevant Offering Memorandum to each Qualified Officer;

(d) the Filer delivers to each of the Decision Makers a copy of each Offering Memorandum provided to Qualified Officers;

(e) the Filer obtains an acknowledgement from each Qualified Officer that such person has received an Offering Memorandum;

(f) the Filer provides to each of the Unitholders, within 140 days of the end of each financial year: (i) unaudited financial statements consisting of a balance sheet, statement of earnings and a statement of cash flows for each fiscal year of the Services Partnership; and (ii) audited financial statements consisting of a statement of net assets, statement of operations and statement of changes in net assets for each fiscal year of the Filer; and

(g) within ten days of each distribution of Filer Units, the Filer files with the securities regulatory authority in the Jurisdiction of the distribution, together with the applicable filing fees, a report in Form 45-106F1.

Furthermore, the decision of the principal regulator and the securities regulatory authority or regulator in Ontario is that any Offering Memorandum delivered to the securities regulatory authority in Alberta or Ontario in accordance with this Decision be kept confidential.

"Glenda A. Campbell, QC"
Vice-Chair
Alberta Securities Commission
 
"Stephen R. Murison"
Vice-Chair
Alberta Securities Commission