First Asset Investment Management Inc. et al.

Headnote

NP 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- Approval of mutual fund mergers -- approval required because mergers do not meet the criteria for pre-approval -- As the continuing fund is new, no simplified prospectus or financial statements are available to send to terminating funds' unitholders, and the continuing fund does not have substantially similar fundamental investment objective or fee structure as compared to that of the terminating funds -- Terminating funds' unitholders provided with timely and adequate disclosure regarding the merger and prospectus-level disclosure regarding the continuing fund.

Applicable Legislative Provisions

National Instrument 81-102 Mutual Funds, ss. 5.5(1)(b), 5.6(1)(a), 5.6(1)(f).

January 17, 2011

IN THE MATTER OF

THE SECURITIES LEGISLATION OF

ONTARIO

(the Jurisdiction)

AND

IN THE MATTER OF

THE PROCESS FOR EXEMPTIVE RELIEF

APPLICATIONS IN MULTIPLE JURISDICTIONS

AND

IN THE MATTER OF

FIRST ASSET INVESTMENT MANAGEMENT

INC. (the Filer), CRITERION WATER

INFRASTRUCTURE FUND AND

CRITERION GLOBAL CLEAN ENERGY FUND

(the Merging Funds)

DECISION

Background

1. The principal regulator in the Jurisdiction has received an application from the Filer on behalf of the Merging Funds for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) for approval of the mergers (the Merger) of each Merging Fund into Criterion Utility Plus Fund (the Continuing Fund) (together with the Merging Funds, the Funds) under subsection 5.5(1)(b) of National Instrument 81-102 Mutual Funds (NI 81-102) (the Requested Relief).

2. Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):

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

(b) the Filer has provided notice that Section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in British Columbia, Alberta, Saskatchewan, Manitoba, Quebec, Nova Scotia and Newfoundland and Labrador (including Ontario, the Jurisdictions).

Interpretation

3. Terms defined in National Instrument 14-101 Definitions and MI 11-102 have the same meaning if used in this decision, unless otherwise defined.

Representations

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

The Filer

5. The head office of the Filer is located at 95 Wellington Street West, Suite 1400, Toronto, Ontario. The Filer is not in default of securities legislation in any of the Jurisdictions and is governed by the laws of Ontario.

Merging Funds

6. The head office of each Merging Fund is located at 95 Wellington Street West, Suite 1400, Toronto, Ontario. The Filer is the manager and trustee of both Merging Funds.

7. The Merging Funds are each open-end mutual fund trusts established under the laws of Ontario and each is a member of the Criterion Investments' Family of Funds.

8. Criterion Water Infrastructure Fund has ten Classes of units outstanding: Class A, B, C, D, F, L, M, N, O and P units and Criterion Global Clean Energy Fund has four classes of units outstanding: Class H, F, U and P units, each offered for sale in the Jurisdictions under a simplified prospectus and annual information form dated June 4, 2010, as amended (together, the "Simplified Prospectus"). A receipt for a final amended and restated simplified prospectus and annual information form, amending and restating the Simplified Prospectus of the Merging Funds, is expected to be received on or about January 14, 2011.

9. Each Merging Fund is a reporting issuer in the Jurisdictions and is not in default of securities legislation in any province or territory of Canada.

The Continuing Fund

10. The Continuing Fund will be launched as a publicly offered open-end mutual fund on or about January 14, 2011, as a member of the Criterion Investments' Family of Funds. The Continuing Fund, a mutual fund trust, will offer for sale in the Jurisdictions two classes of units: Class A and F units, under a simplified prospectus and annual information form. The head office of the Continuing Fund will be located at 95 Wellington Street West, Suite 1400, Toronto, Ontario. The Filer will be the manager and trustee of the Continuing Fund.

The Merger

11. The Filer proposes to merge each Merging Fund into the Continuing Fund. A press release and material change report each dated November 24, 2010 and an amendment number 2 dated November 25, 2010 to the Simplified Prospectus were filed on SEDAR in November, 2010 in connection with the proposed Mergers.

12. At special meetings of unitholders held on January 10, 2011, unitholders of each Merging Fund approved their respective Mergers into the Continuing Fund. Subject to necessary regulatory approval, the Filer intends to implement the Mergers prior to January 31, 2011.

13. A joint notice of special meeting and management information circular (the Circular) was mailed to unitholders of the Merging Funds on or about December 15, 2010.

14. Unitholders of the Merging Funds will continue to have the right to redeem securities of such Merging Funds for cash at any time up to the close of business on the day prior to the effective date of the Mergers.

15. Upon completion of the Mergers, all classes of units of the Merging Funds that are fee-based and not subject to a servicing fee (i.e. class F and class P units of the Merging Funds) will be exchanged for a class of units of the Continuing Fund that are similarly fee-based and not subject to a servicing fee (i.e. class F units of the Continuing Fund). All other outstanding classes of units of each of the Merging Funds, which may be subject to the initial sales charge, low-load, or deferred sales charge options will be exchanged for class A units of the Continuing Fund that are similarly subject to the initial sales charge, low-load, or deferred sales charge options, respectively.

16. Units of each class of the Merging Funds will be exchanged for units of the corresponding class of the Continuing Fund at an exchange ratio calculated by dividing the net asset value per unit of the relevant class of the relevant Merging Fund by the net asset value per unit of the relevant class of the Continuing Fund, as determined at the close of business on the business day prior to the effective date of the Mergers.

17. The Mergers will be structured as a tax-deferred transaction within the meaning of section 132.2 of the Income Tax Act (Canada).

18. Following the Mergers, a material change report for the Merging Funds and the Continuing Fund and an amendment to the Simplified Prospectus of each Merging Fund and the Continuing Fund will be filed on SEDAR.

19. Following the Mergers, the Merging Funds will be wound up as soon as reasonably practicable.

20. Neither the Merging Funds nor the Continuing Fund will bear any costs of their respective Mergers.

21. The net asset value for the Merging Funds are, and for the Continuing Fund will be, calculated on a daily basis on each business day in Toronto, Ontario.

22. Approval of the Mergers is required because the Mergers do not satisfy all of the criteria for pre-approved reorganizations and transfers set out in section 5.6 of NI 81-102 because:

(a) contrary to section 5.6(1)(a)(ii) of NI 81-102, a reasonable person may consider the fundamental investment objectives and fee structure of the Continuing Fund not to be substantially similar to the fundamental investment objectives and fee structure of each Merging Fund; and

(b) contrary to section 5.6(1)(f)(ii) of NI 81-102, the current simplified prospectus and the most recent annual and interim financial statements for the Continuing Fund will not be sent to unitholders of the Merging Funds.

23. As required by National Instrument 81-107 -- Independent Review Committee for Investment Funds, the Filer presented the terms of the Mergers to the independent review committee of each Merging Fund for its review. The independent review committee of each Merging Fund recommended the Mergers advising that, after reasonable inquiry, it concluded that the Mergers will achieve a fair and reasonable result for the unitholders of each Merging Fund.

24. The Filer cannot deliver the current simplified prospectus and the most recent annual and interim financial statements for the Continuing Fund as the Continuing Fund is new and does not yet have receipt for a final simplified prospectus or financial statements. Instead of delivering these documents, the Filer included a description of the Continuing Fund in the Circular as well as a description of the similarities and differences between the Merging Funds and the Continuing Fund. In particular, the differences in the fundamental investment objectives and fee structure of the Merging Funds and the Continuing Fund have been disclosed in the Circular.

25. The information in the Circular, together with the information contained in the Simplified Prospectus of the Merging Funds that unitholders in the Merging Funds received when their initial investment was made, provide unitholders with prospectus-level disclosure with respect to the Continuing Fund.

26. The Circular also disclosed that the final simplified prospectus and annual information form regarding the Continuing Fund will be available on or about January 12, 2011, subject to regulatory approval, and that unitholders of the Merging Funds can obtain such documents by calling the Filer at a toll-free number or by accessing the SEDAR website. Upon request by a unitholder, the Filer will make best efforts to provide a unitholder with the simplified prospectus and annual information form in a timely manner.

27. The Filer believes the Mergers will be beneficial to unitholders of each Merging Fund for the following reasons:

(a) following the Mergers, unitholders of the Merging Funds are expected to enjoy improved economies of scale and potentially lower proportionate fund operating expenses (which are borne indirectly by unitholders of the Merging Funds) as part of the larger combined Continuing Fund;

(b) the comparatively larger portfolio of the Continuing Fund is expected to offer improved portfolio diversification to unitholders of each of the Merging Funds;

(c) the Continuing Fund is expected to have larger cash balances as a result of its larger size; and

(d) the Mergers transition unitholders of each of the Merging Funds to a growing and more viable Continuing Fund.

Decision

The Principal Regulator is satisfied that the test contained in the Legislation that provides the Principal Regulator with the jurisdiction to make the decision has been met. The decision of the Principal Regulator under the Legislation is that the Requested Relief is granted.