Securities Law & Instruments


Subclause 121(2)(a)(ii) - subdivided offering- relief from section 119 - the prohibition prohibiting tradingin portfolio shares by persons or companies having informationconcerning the trading programs of mutual funds shall not applyto the promoter/agent with respect to certain principal tradeswith the issuer in securities comprising the issuer's portfolio.

Applicable Ontario Statutes

Securities Act, R.S.O. 1990, c. S.5, as amended,ss. 1(1), 121(2)(a)(ii).



R.S.O. 1990, CHAPTER S.5,AS AMENDED (the "Act")








(Subclause 121(2)(a)(ii))

UPON the application of Integrated OilNT Corp. ("Integrated Oil") and BMO NesbittBurns Inc. ("Nesbitt") to the Ontario SecuritiesCommission (the "Commission") pursuant to subclause121(2)(a)(ii) of the Act for an order exempting Nesbitt fromthe applicability of section 119 of the Act in connection withthe acquisition by Nesbitt, as principal, of certain portfoliosecurities owned by Integrated Oil in connection with the redemptionby Integrated Oil of all of its issued and outstanding capitalshares (the "Capital Shares") and preferredshares (the "Preferred Shares");

AND UPON considering the applicationand the recommendation of staff of the Commission;

AND UPON the applicants having representedto the Commission that:

1. Integrated Oil was incorporated under thelaws of the Province of Ontario on March 9, 1998.

2. Integrated Oil is a passive "splitshare" investment company, the purpose of which is toenable investors, through the holding of Capital Shares orPreferred Shares, to satisfy separately the investment objectivesof capital appreciation or dividend income with respect tocommon shares (the "Portfolio Shares") ofImperial Oil Limited, Petro-Canada, Shell Canada Limited andSuncor Energy Inc. held by Integrated Oil.

3. Integrated Oil is a reporting issuer withinthe meaning of the Act and, to the best of its knowledge,is not in default of any requirement of the Act or the regulationor rules made thereunder.

4. Integrated Oil is a mutual fund as definedin subsection 1(1) of the Act.

5. The Capital Shares and the Preferred Sharesare listed on The Toronto Stock Exchange Inc. (the "TSX").

6. The Portfolio Shares are listed and tradedon, among other stock exchanges, the TSX.

7. Nesbitt is the administrator of the ongoingaffairs of Integrated Oil under an administration agreement,in respect of which it earns a fee for its services.

8. Nesbitt is registered under the Act asa dealer in the categories of "broker" and "investmentdealer" and is a member of the Investment Dealers Associationof Canada and the TSX. A predecessor of Nesbitt, Nesbitt BurnsInc., acted as promoter and as one of the agents in connectionwith the offering of the Capital Shares and the PreferredShares to the public pursuant to the prospectus of IntegratedOil dated May 27, 1998 (the "Prospectus").

9. Three of the five directors and all ofthe officers of Integrated Oil are employees of Nesbitt.

10. Nesbitt is not an insider, within themeaning of subsection 1(1) of the Act, of any issuer of thePortfolio Shares.

11. By virtue of Nesbitt's relationship withIntegrated Oil, Nesbitt has access to information concerningthe investment program of Integrated Oil.

12. In accordance with the articles of IntegratedOil, and consistent with the disclosure in the Prospectusand therefore the expectations of purchaser of the CapitalShares and the Preferred Shares at the time of the initialdistribution, the Board of Directors of Integrated Oil proposesto have Integrated Oil redeem all of the Capital Shares andPreferred Shares then outstanding on April 9, 2003.

13. To fund the redemption, Integrated Oilproposes to liquidate its portfolio of Portfolio Shares by:

(a) selling Portfolio Shares to holdersof Capital Shares in accordance with the option describedbelow in paragraph 14; and

(b) selling remaining Portfolio Shares byway of one or more competitive tenders, or otherwise privately,or into the market.

14. As contemplated in the articles of IntegratedOil and the Prospectus, at the request of certain holdersof Capital Shares who tender their shares together with acertain cash payment, Integrated Oil will make payment ofthe amount due on redemption of the Capital Shares by deliveringPortfolio Shares (rounded down to the nearest whole share)having a value equal to the redemption price in respect ofsuch Capital Shares and the additional cash payment (the "ShareholderPurchases").

15. Integrated Oil proposes to dispose ofremaining Portfolio Shares by way of one or more competitivetenders to be supervised by the two independent directorsof Integrated Oil, Integrated Oil and its legal counsel andwhich will involve a request for tenders from Nesbitt andno fewer than two other major investment dealers acting atarm's length to Integrated Oil and Nesbitt (the "TenderProcess"). Integrated Oil is proposing to disposeof Portfolio Shares by way of Tender Process to ensure thatthe Portfolio Shares will be disposed of in an orderly fashionso that Integrated Oil may realize the best reasonably availableprice therefor, and to preclude any artificial reduction inthe market price of the Portfolio Shares which may be causedby selling the significant number of Portfolio Shares requiredto be sold into the market.

16. Participants in each Tender Process willonly have one opportunity to bid for the Portfolio Sharesand the persons supervising the Tender Process will not, priorto completion of the Tender Process, disclose to any participantthe bid price for the Portfolio Shares submitted by the otherparticipants.

17. With price being the sole determiningfactor, the Portfolio Shares to be sold under each TenderProcess will be sold to the participant bidding the highestprice (the "Bid Price") for such PortfolioShares. Accordingly, it is possible that the Portfolio Sharesmay be sold to Nesbitt, as principal (the "TenderProcess Purchases").

18. In addition to the Shareholder Purchasesand the Tender Process, or where such methods are not chosenor available, Integrated Oil also intends to fund redemptionsby selling Portfolio Shares to Nesbitt who may purchase suchshares as principal (the "Regular Purchases",and together with the Tender Process Purchases, the "PrincipalPurchases"), either privately or through the market,provided that the price obtained (net of all transaction costs,if any) by Integrated Oil from Nesbitt is at least as highas the price that is available (net of all transaction costs,if any) through the facilities of the applicable stock exchangeat the time of the trade.

19. When making a Principal Purchase, Nesbittwill comply with the rules, procedures and policies of thestock exchanges of which it is a member regarding principaltransactions.

20. Any Principal Purchases will be approvedby the two independent directors of Integrated Oil.

21. Nesbitt will not receive any commissionsfrom Integrated Oil in connection with Principal Purchasesand in carrying out Principal Purchases, Nesbitt will dealfairly, honestly and in good faith with Integrated Oil.

AND UPON the Commission being satisfiedthat to do so would not be prejudicial to the public interest;

IT IS ORDERED, pursuant to subclause121(2)(a)(ii) of the Act, that Nesbitt is exempt from the applicabilityof section 119 of the Act in respect of the Principal Purchases,provided that such purchases are made in accordance with paragraphs14 through 21 herein.

March 4, 2003.

"Paul M. Moore"                   "TheresaMcLeod"