Securities Law & Instruments

Headnote

National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- Approval of mutual fund merger and change of manager -- merger approval required because the mergers do not meet the criteria for pre-approved reorganizations and transfers in National Instrument 81-102 Investment Funds -- manager of a continuing fund is not an affiliate of the manager of the terminating fund -- unitholders of the terminating fund are provided with timely and adequate disclosure regarding the merger and change of manager.

Applicable Legislative Provisions

National Instrument 81-102 Investment Funds, ss. 5.5(1)(a), 5.5(1)(b), 19.1.

June 17, 2020

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 FIERA INVESTMENTS LP (the Filer) AND FIERA CANADIAN BOND FUND, LOOMIS SAYLES GLOBAL DIVERSIFIED CORPORATE BOND FUND, LOOMIS SAYLES STRATEGIC MONTHLY INCOME FUND, FIERA STRATEGIC BALANCED REGISTERED FUND, FIERA INTRINSIC BALANCED REGISTERED FUND, FIERA CANADIAN DIVIDEND REGISTERED FUND, FIERA U.S. DIVIDEND REGISTERED FUND, FIERA CORE GLOBAL EQUITY REGISTERED FUND, FIERA CANADIAN PREFERRED SHARE REGISTERED FUND, OAKMARK U.S. EQUITY REGISTERED FUND, AND OAKMARK INTERNATIONAL EQUITY REGISTERED FUND (the Trust Funds) AND FIERA CANADIAN BOND CLASS, LOOMIS SAYLES GLOBAL DIVERSIFIED CORPORATE BOND CLASS, FIERA STRATEGIC BALANCED CLASS, FIERA INTRINSIC BALANCED CLASS, FIERA CANADIAN DIVIDEND CLASS, FIERA U.S. DIVIDEND CLASS, FIERA CORE GLOBAL EQUITY CLASS, FIERA CANADIAN PREFERRED SHARE CLASS, OAKMARK U.S. EQUITY CLASS, AND OAKMARK INTERNATIONAL EQUITY CLASS (the Class Funds and, together with the Trust Funds, the Funds)

DECISION

Background

The principal regulator in the Jurisdiction has received an application from the Filer, on behalf of the Funds, for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) approving:

a. the change of manager of the Funds from the Filer to Canoe Financial LP (Canoe) (the Change of Manager) pursuant to paragraph 5.5(1)(a) of National Instrument 81-102 -- Investment Funds (NI 81-102); and

b. the mergers of the Funds into certain mutual funds managed or to be managed by Canoe (each, a Canoe Continuing Fund and together, the Canoe Continuing Funds) pursuant to paragraph 5.5(1)(b) of NI 81-102 (the Mergers).

(collectively, the Approvals Sought)

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;

b. The Filer has provided notice that subsection 4.7(1) of Multilateral Instrument 11-102 -- Passport System (MI 11-102) is intended to be relied upon in each of Alberta, British Columbia, Saskatchewan, Manitoba, Québec, New Brunswick, Newfoundland and Labrador, Nova Scotia, Prince Edward Island, Northwest Territories, Nunavut and Yukon (together with the Jurisdiction, the Canadian Jurisdictions).

Interpretation

Terms defined in National Instrument 14-101 -- Definitions, MI 11-102, and NI 81-102 have the same meaning if used in this decision, unless otherwise defined.

In addition:

Closing means the closing of the Proposed Transaction (as defined below), which is expected to occur on or about June 26, 2020.

Representations

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

The Filer

1. The Filer is a limited partnership formed under the laws of Ontario. The general partner of the Filer is Fiera Investments Limited (the General Partner), a corporation incorporated under the laws of Ontario.

2. The Filer's head office is located in Toronto, Ontario.

3. The Filer is the investment fund manager and portfolio manager of the Funds, as well as the trustee of the Trust Funds, with the exception of Loomis Sayles Strategic Monthly Income Fund, whose portfolio manager is Loomis, Sayles & Company, L.P.

4. The Filer is registered in all provinces and territories in the category of exempt market dealer. The Filer is also registered in Québec, Ontario and Newfoundland and Labrador in the category of investment fund manager, and in Ontario in the category of mutual fund dealer and portfolio manager.

5. The Filer is not in default of securities legislation in any of the Canadian Jurisdictions.

The Funds

6. Each of the Trust Funds is a mutual fund formed as a trust established under the laws of Ontario pursuant to the Amended and Restated Master Declaration of Trust dated as of May 5, 2006, as amended (the Declaration of Trust).

7. Each of the Class Funds represents a distinct investment portfolio corresponding to certain classes of shares of Fiera Investments Capital Corporation (FIC), a mutual fund corporation governed by the Business Corporations Act (Ontario).

8. With the exception of Loomis Sayles Strategic Monthly Income Fund, Fiera Canadian Bond Fund and Loomis Sayles Global Diversified Corporate Bond Fund (each a Single Trust Fund and collectively, the Single Trust Funds), each of the Trust Funds has a corresponding Class Fund with similar investment objectives into which it invests substantially all its portfolio assets. Each of Fiera Canadian Bond Class and Loomis Sayles Global Diversified Corporate Bond Class has a corresponding Single Trust Fund with similar investment objectives into which it invests substantially all its portfolio assets. Loomis Sayles Strategic Monthly Income Fund does not have a corresponding Class Fund.

9. Three classes of each Class Fund are currently offered by prospectus, namely (i) Return of Capital, (ii) Dividend, and (iii) Compound Growth. Certain classes of mutual funds shares of some Class Funds were previously offered by prospectus, such as the Capital Gains class, and certain other classes of mutual fund shares of the Class Funds were never offered to the public, such as the Inter-Fund class, which was used to track investments from the relevant Trust Funds into the Class Funds. Each of the classes of each Class Fund is further subdivided into three series available to the public, Series A, F, and I, and some classes of certain Class Funds were subdivided into other series which still exist, but are no longer available for purchase under the prospectus.

10. The Funds are currently offered for sale in every province and territory of Canada under a simplified prospectus, annual information form and fund facts documents dated June 14, 2019, as amended and restated on July 12, 2019 and further amended by Amendment No. 1 dated October 18, 2019, and further amended by Amendment No. 2 dated April 17, 2020, prepared in accordance with the requirements of National Instrument 81-101 -- Mutual Fund Prospectus Disclosure (NI 81-101).

11. On May 15, 2020, the Canadian Securities Administrators issued exemptive relief in favour of the Filer and the Funds pursuant to which the lapse date of the Funds' simplified prospectus was postponed to on or before August 31, 2020.

12. Each Fund is a reporting issuer under the applicable securities legislation of each of the Jurisdictions and is not in default of securities legislation in any of the Canadian Jurisdictions.

13. Each Trust Fund is a "registered investment" under the Income Tax Act (Canada) (Tax Act) and, except for one Trust Fund, all Funds qualify as a mutual fund trust under the Tax Act.

14. As FIC is a mutual fund corporation under the Tax Act, the shares of each of the Class Funds are qualified investments for registered plans.

Canoe

15. Canoe is a limited partnership established under the laws of Alberta. The general partner of Canoe is Canoe Financial Corp., a corporation incorporated under the laws of Alberta. Canoe's head office is located in Calgary, Alberta.

16. Canoe is registered as an exempt market dealer in each of the provinces and territories of Canada, as a portfolio manager in Alberta, Ontario and Québec, as an investment fund manager in Alberta, Newfoundland and Labrador, Ontario and Québec, and as a derivatives portfolio manager in Québec.

17. Canoe is the manager of certain open-ended investment funds (Canoe Mutual Funds) that are formed as either (i) a trust under the laws of Alberta, or (ii) an investment in a series of shares of a class of Canoe 'GO CANADA!' Fund Corp. (Canoe Fund Corp.), a corporation established under the Business Corporations Act (Alberta), and a unit (CTF Unit) of Canoe Trust Fund (CTF), a fund that is formed as a trust (collectively, a Canoe Portfolio Class Fund). Canoe is also the manager of certain closed-ended investment funds (with the Canoe Mutual Funds, the Canoe Funds).

18. Canoe's primary business is to act as investment fund manager for the Canoe Funds and to act as portfolio manager for certain Canoe Funds.

19. Canoe is not in default of securities legislation in any of the Canadian Jurisdictions.

Canoe Mutual Funds

20. Each of the existing Canoe Mutual Funds is a mutual fund constituted as a trust and governed by a master declaration of trust (each, a Canoe Mutual Fund Trust) or is a Canoe Portfolio Class Fund.

21. Canoe acts as investment fund manager of the Canoe Mutual Funds and as trustee of the Canoe Mutual Fund Trusts.

22. The existing Canoe Mutual Funds are reporting issuers under the securities legislation of each of the provinces and territories of Canada.

23. The securities of the existing Canoe Mutual Funds are qualified for distribution by simplified prospectus governed by NI 81-101.

24. Securities of the existing Canoe Mutual Funds, other than Canoe Defensive Global Balanced Fund, are currently offered under a simplified prospectus and annual information form each dated August 2, 2019, as it may be amended from time to time. Securities of Canoe Defensive Global Balanced Fund are currently offered under a simplified prospectus, annual information form and fund facts documents each dated April 9, 2020, as it may be amended from time to time.

25. Provided the Proposed Transaction closes and the applicable Mergers involving the New Canoe Fund (as defined below) receive all necessary securityholder and regulatory approvals, Canoe will create the New Canoe Fund and qualify securities of the New Canoe Fund for distribution under a simplified prospectus governed by NI 81-101.

26. Securities of the existing Canoe Mutual Funds, other than Canoe Defensive Global Balanced Fund, are qualified investments for registered plans. Securities of Canoe Defensive Global Balanced Fund and the New Canoe Fund are expected to be qualified investments for registered plans.

27. The existing Canoe Mutual Funds are not in default of securities legislation in any of the Canadian Jurisdictions.

The Proposed Transaction

28. The Filer has entered into an agreement with Canoe (the Purchase Agreement) pursuant to which Canoe has agreed to acquire the rights to manage the Funds from the Filer (the Proposed Transaction).

29. A press release announcing the Proposed Transaction was issued and disseminated on April 9, 2020 and a related material change report, and amendments to the simplified prospectus, annual information form and funds facts documents of the Funds were filed on the System for Electronic Document Analysis and Retrieval (SEDAR) in connection with the Proposed Transaction on April 20, 2020.

30. As part of the Proposed Transaction, Canoe intends to, amongst other things, change the investment fund manager of the Funds, trustee of the Trust Funds, and portfolio manager of the Funds (other than Loomis Sayles Strategic Monthly Income Fund) and, on or about July 3, 2020 (the Merger Date), merge the Funds into the Canoe Continuing Funds as more fully described in the following table (each, a Merger and collectively, the Mergers):

Fund

Canoe Continuing Fund

Merger 1

Fiera Canadian Bond Class

Canoe Bond Advantage Portfolio Class, which consists of Canoe Bond Advantage Class and units of Canoe Trust Fund

Merger 2

Loomis Sayles Global Diversified Corporate Bond Class

Canoe Global Income Portfolio Class, which consists of Canoe Global Income Class and units of Canoe Trust Fund

Merger 3

Fiera Canadian Preferred Share Class

Canoe Preferred Share Portfolio Class, a new Canoe Portfolio Class Fund to be created prior to the Merger Date consisting of Canoe Preferred Share Class and units of Canoe Trust Fund

Merger 4

Fiera Intrinsic Balanced Class

Canoe Defensive Global Balanced Fund

Merger 5

Fiera Canadian Dividend Class

Canoe Premium Income Fund

Merger 6

Fiera U.S. Dividend Class

Canoe Defensive U.S. Equity Portfolio Class, which consists of Canoe Defensive U.S. Equity Class and units of Canoe Trust Fund

Merger 7

Fiera Strategic Balanced Class

Canoe North American Monthly Income Portfolio Class, which consists of Canoe North American Monthly Income Class and units of Canoe Trust Fund

Merger 8

Fiera Core Global Equity Class

Canoe Global Equity Fund

Merger 9

Oakmark U.S. Equity Class

Canoe Defensive U.S. Equity Portfolio Class, which consists of Canoe Defensive U.S. Equity Class and units of Canoe Trust Fund

Merger 10

Oakmark International Equity Class

Canoe Defensive International Equity Fund

Merger 11

Fiera Canadian Bond Fund

Canoe Bond Advantage Portfolio Class, which consists of Canoe Bond Advantage Class and units of Canoe Trust Fund

Merger 12

Loomis Sayles Global Diversified Corporate Bond Fund

Canoe Global Income Fund

Merger 13

Loomis Sayles Strategic Monthly Income Fund

Canoe Global Income Fund

Merger 14

Fiera Canadian Preferred Share Registered Fund

Canoe Preferred Share Portfolio Class, a new Canoe Portfolio Class Fund to be created prior to the Merger Date consisting of Canoe Preferred Share Class and units of Canoe Trust Fund

Merger 15

Fiera Intrinsic Balanced Registered Fund

Canoe Defensive Global Balanced Fund

Merger 16

Fiera Canadian Dividend Registered Fund

Canoe Premium Income Fund

Merger 17

Fiera U.S. Dividend Registered Fund

Canoe Defensive U.S. Equity Portfolio Class, which consists of Canoe Defensive U.S. Equity Class and units of Canoe Trust Fund

Merger 18

Fiera Strategic Balanced Registered Fund

Canoe North American Monthly Income Portfolio Class, which consists of Canoe North American Monthly Income Class and units of Canoe Trust Fund

Merger 19

Fiera Core Global Equity Registered Fund

Canoe Global Equity Fund

Merger 20

Oakmark U.S. Equity Registered Fund

Canoe Defensive U.S. Equity Portfolio Class, which consists of Canoe Defensive U.S. Equity Class and units of Canoe Trust Fund

Merger 21

Oakmark International Equity Registered Fund

Canoe Defensive International Equity Fund

31. In accordance with the provisions of National Instrument 81-107 -- Independent Review Committee for Investment Funds (NI 81-107), the Filer referred the Proposed Transaction, including the Change of Manager and the Mergers to the Independent Review Committee (IRC) of the Funds for its review. On May 4, 2020, the IRC advised the Filer that, after reasonable inquiry, the Proposed Transaction achieves a fair result for the Funds.

32. The Filer is not entitled to rely upon the approval of the applicable IRC in lieu of securityholder approval for the Mergers due to the fact that the requirement of section 5.3(2) of NI 81-102, that all the conditions of section 5.6 of NI 81-102 be met, cannot be fulfilled, notably because:

a. the Funds and Canoe Continuing Funds do not have the same or affiliated managers;

b. the Funds and Canoe Continuing Funds would not be considered by a reasonable person to have substantially similar investment objectives, other than in the case of Mergers 3, 5, 8, 9, 10, 14, 16, 19, 20 and 21;

c. the Funds and Canoe Continuing Funds would not be considered by a reasonable person to have substantially similar fee structures;

d. the Mergers involving each of Fiera Canadian Preferred Share Registered Fund, Fiera Intrinsic Balanced Registered Fund, Fiera Canadian Dividend Registered Fund, Fiera U.S. Dividend Registered Fund, Fiera Strategic Balanced Registered Fund, Fiera Core Global Equity Registered Fund, Oakmark U.S. Equity Registered Fund and Oakmark International Equity Registered Fund (each, a Registered Fund), being Merger 14 through Merger 21, will not be implemented as a "qualifying exchange" within the meaning of section 132.2 of the Tax Act or a tax-deferred transaction under subsection 85(1), 85.1(1), 86(1) or 87(1) of the Tax Act; and

e. the materials to be sent to certain securityholders of the Funds in respect of certain Mergers will not include the current simplified prospectus or the most recently filed fund facts document(s) for the series of the Canoe Continuing Funds into which the applicable series of the Funds are merging into because:

i. the applicable series of the Canoe Continuing Funds (the Hard Capped Series) will not be qualified for distribution under a prospectus, will not be available for sale subsequent to the Mergers (the Hard Capped Mergers) and, in certain instances, are being created solely to facilitate the Mergers; or

ii. the series of Canoe Preferred Share Portfolio Class (the New Canoe Fund) will only be created and qualified for distribution under a prospectus if the Proposed Transaction closes and the applicable Mergers receive all necessary securityholder and regulatory approvals (the New Canoe Fund Mergers).

33. Pursuant to section 5.1(1)(b) of NI 81-102 and section 9.1 of the Declaration of Trust in respect of the Fiera Trust Funds, special meetings of the securityholders of the Funds were held on June 12, 2020 (the Meetings), for the purpose of seeking approval, inter alia, of matters relating to the Proposed Transaction with Canoe. Investors in the Funds were asked to vote on the proposed Change of Manager and, in the case of the Trust Funds, on the change of trustee from Fiera to Canoe (the Change of Trustee). In addition, investors in each Fund were asked to approve the relevant Merger (the Change of Manager, Change of Trustee and Mergers are collectively referred to as the Transaction Approval Changes).

34. At the Meetings, investors in each Fund voted to approve the Change of Manager and each relevant Merger. In the case of the Trust Funds, investors in each Trust Fund voted to approve the Change of Trustee.

35. The notice of Meetings and the joint management information circular in respect of the Meetings (the Meeting Materials) describing the Transaction Approval Changes were sent to securityholders of the Funds on May 22, 2020 and copies thereof were filed on SEDAR following the mailing in accordance with the Legislation. The Meeting Materials contained sufficient information regarding the business, management and operations of Canoe, including details of its officers and directors, and all information necessary to allow securityholders of the Funds to make an informed decision about the Transaction Approval Changes. All other information and documents necessary to comply with applicable proxy solicitation requirements of the Legislation for the Meetings were also mailed to securityholders of the Funds, including fund facts document(s) of the Canoe Continuing Funds, other than as described in paragraph 37 below.

36. As a result, upon Closing, and subject to receipt of all necessary regulatory and securityholder approvals and the satisfaction of all other required conditions precedent set out in the Purchase Agreement, including approval of the Mergers, the Change of Manager will occur.

37. Also effective upon Closing, Fiera Capital Corporation, the Filer's parent company, will become sub-advisor of certain Canoe Continuing Funds in accordance with the terms of a sub-advisory agreement between Canoe and Fiera Capital Corporation.

38. Fund facts document(s) relating to the applicable series of each Canoe Continuing Fund were mailed to securityholders of the corresponding series of each Fund in all instances, other than fund facts document(s) for the New Canoe Fund (for which no fund facts document(s) were mailed but prospectus-level disclosure will be provided in the Meeting Materials) and for the Hard Capped Series (for which the fund facts document(s) specified in paragraph 38 were mailed).

39. In respect of the Hard Capped Mergers, the following Hard Capped Series will not be qualified for distribution under a prospectus, will not be available for sale subsequent to the Mergers and, in certain instances, are being created solely to facilitate the Mergers. Because a current simplified prospectus and fund facts document(s) are not available for the Hard Capped Series, securityholders of each of the corresponding series of the Funds were sent fund facts document(s) relating to the following series of securities of the applicable Canoe Continuing Fund:

Fund

Class

Series Currently Held

Hard Capped Series Received pursuant to Merger

Series of Fund Facts Received

Canoe Continuing Fund

Fiera Intrinsic Balanced Class

Capital Gains

H

HN

A

Canoe Defensive Global Balanced Fund

U

AN

Return of Capital

H

HN

Dividend

H

HN

Compound Growth

H

HN

U

AN

Fiera Intrinsic Balanced Registered Fund

-

H

HN

U

AN

Fiera Canadian Bond Class

Capital Gains

H

HN

A

Canoe Bond Advantage Portfolio Class, which consists of Canoe Bond Advantage Class and units of Canoe Trust Fund

U

AN

Return of Capital 6

H

HN

Return of Capital

H

HN

U

AN

Dividend 6

H

HN

Dividend

H

HN

U

AN

Compound Growth

H

HN

U

AN

Fiera Canadian Bond Fund

-

H

HN

Loomis Sayles Global Diversified Corporate Bond Class

Capital Gains

H

HN

A

Canoe Global Income Portfolio Class, which consists of Canoe Global Income Class and units of Canoe Trust Fund

Return of Capital

H

HN

Dividend

H

HN

Compound Growth

H

HN

U

AN

Loomis Sayles Global Diversified Corporate Bond Fund

-

H

HN

A

Canoe Global Income Fund

Fiera Canadian Dividend Class

Capital Gains

H

HN

A

Canoe Premium Income Fund

U

AN

Return of Capital

H

HN

HF

FN

F

Dividend

H

HN

A

HF

FN

F

U

AN

A

Compound Growth

H

HN

A

HF

FN

F

Fiera Canadian Dividend Registered Fund

-

H

HN

A

HF

FN

F

U

AN

A

Fiera U.S. Dividend Class

Dividend

U

AN

A

Canoe Defensive U.S. Equity Portfolio Class, which consists of Canoe Defensive U.S. Equity Class and units of Canoe Trust Fund

Fiera Core Global Equity Class

Capital Gains

H

AV

A

Canoe Global Equity Fund

Return of Capital

H

AV

U

AN

Dividend

H

AV

U

AN

Compound Growth

H

AV

U

AN

Fiera Core Global Equity Registered Fund

-

H

AV

A

Loomis Sayles Strategic Monthly Income Fund

-

H

HN

A

Canoe Global Income Fund

40. In respect of the New Canoe Fund Mergers, Canoe will only create the New Canoe Fund if the Transaction closes and the necessary securityholder and regulatory approvals are obtained in respect of the New Canoe Fund Mergers. As such, a current simplified prospectus and fund facts documents are not currently available for the New Canoe Fund. Instead of delivering these documents, the Filer included information in respect of the New Canoe Fund in the Meeting Materials, including its investment objectives and strategies (the objectives of which will be substantially similar to those of Fiera Canadian Preferred Share Class and Fiera Canadian Preferred Share Registered Fund), fees and expenses, purchase options and distribution policy. The Filer believes that with this information, together with the information contained in the fund facts of the relevant series of Fiera Canadian Preferred Share Class and Fiera Canadian Preferred Share Registered Fund that each securityholder of such Funds received when their initial investment was made, securityholders in Fiera Canadian Preferred Share Class and Fiera Canadian Preferred Share Registered Fund will have access to prospectus-level disclosure with respect to the New Canoe Fund.

41. In order to effect the Hard Capped Mergers and the New Canoe Fund Mergers, securities of the Canoe Continuing Funds will be distributed to securityholders of the relevant Funds in reliance on the prospectus exemption contained in section 2.11 of NI 45-106.

Details of the Mergers

42. The specific steps to implement the Mergers are described below. The result of the Mergers is that securityholders of a Fund will receive securities of a Canoe Continuing Fund.

43. The total value of the securities of each Canoe Continuing Fund offered to securityholders of the relevant Fund will have a value that is equivalent to the net asset value of the Fund calculated on the date immediately preceding the date of the Merger.

44. The management fee of each relevant series of each Canoe Continuing Fund is the same as, or lower than, the management fee of the corresponding series of its corresponding Fund.

45. The Canoe Continuing Funds have all adopted a fixed administration fee structure while the Funds have a floating expense structure. The Meeting Materials delineate the differences in the management and administration fees and expense structures between the Funds and the Canoe Continuing Funds.

46. The investment objective of certain Funds may not be substantially similar to the investment objective of their corresponding Canoe Continuing Funds. Where applicable, the Meeting Materials delineate any differences in investment objectives between each Fund and the relevant Canoe Continuing Fund into which it will be merged.

47. No sales charges will be payable by securityholders of the Funds in connection with the Mergers.

48. The Merger of each of Loomis Sayles Global Diversified Corporate Bond Fund, Loomis Sayles Strategic Monthly Income Fund, Fiera Canadian Dividend Class, Fiera Intrinsic Balanced Class, Fiera Core Global Equity Class and Oakmark International Equity Class into its corresponding Canoe Continuing Fund is expected to be completed as a tax-deferred transaction under the Tax Act. As a result, these Funds and their securityholders will not realize any net capital gains on these Mergers.

49. The Merger of each Registered Fund into its corresponding Canoe Continuing Fund is not expected to be completed as a "qualifying exchange" or a tax-deferred transaction. The Filer and Canoe propose to effect these Mergers on a taxable basis because the tax-deferred option that would be available is not desirable. In deciding to proceed with these Mergers on a taxable basis, the Filer and Canoe weighed the impact of the Mergers on each Registered Fund and its corresponding Canoe Continuing Fund, and on the unitholders in each Registered Fund and its corresponding Canoe Continuing Fund, and determined that the negative effects of these Mergers were greater on the corresponding Canoe Continuing Funds and the securityholders of such Canoe Continuing Fund than on the Registered Funds and the unitholders of such Registered Funds should the Mergers proceed on a tax-deferred basis. Because the Registered Funds are solely held by investors in registered plans, there is no negative impact on the unitholders of a Registered Fund in proceeding with a taxable merger. On the other hand, a tax-deferred merger would result in accrued gains from each Registered Fund being ultimately realized in its corresponding Canoe Continuing Fund. Further, any loss carryforwards in the corresponding Canoe Continuing Funds would be realized or lost in a tax-deferred merger. Thus, the Filer and Canoe have determined that the negative impact on the corresponding Canoe Continuing Funds -- of not being able to use their available loss carryforwards to offset future capital gains -- outweighs the impact on investors in the Registered Funds, who will not experience any negative impact in proceeding with a taxable merger.

50. It is expected that the Mergers involving Fiera Canadian Bond Class, Loomis Sayles Global Diversified Corporate Bond Class, Fiera Canadian Preferred Share Class, Fiera U.S. Dividend Class, Fiera Strategic Balanced Class, Oakmark U.S. Equity Class and Fiera Canadian Bond Fund will each be completed as a primarily tax-deferred transaction. It is expected that the transfer of each Fund's portfolio to CTF will be a "qualifying exchange" and that securityholders will only realize a nominal capital gain or capital loss on the subsequent redemption of a portion of the value of the CTF Unit to subscribe for shares of Canoe Fund Corp.

51. The Filer is not entitled to rely upon the approval of the applicable IRC in lieu of securityholder approval for the Mergers due to the fact that, as identified above, one or more conditions of section 5.6 of NI 81-102 will not be met, as required by section 5.3(2) of NI 81-102.

52. Subject to the Proposed Transaction closing and to the discretion of Canoe not to proceed with any Merger, it is expected that each Merger will be implemented if approved by securityholders of the relevant Fund, regardless of whether another Merger is approved by securityholders of the other Funds.

53. With the exception of the Mergers involving Canoe Defensive International Equity Fund and Canoe Defensive U.S. Equity Class, the Mergers will not be considered a material change for any of the other Canoe Continuing Funds.

a. Because the total assets under management (AUM) of Oakmark International Equity Class and Oakmark International Equity Registered Fund corresponds to approximately $83.4 million, and the AUM of Canoe Defensive International Equity Fund corresponds to approximately $83.5 million as at April 30, 2020, these proposed Mergers may constitute a material change for Canoe Defensive International Equity Fund.

b. Because the total AUM of Fiera U.S. Dividend Class, Fiera U.S. Dividend Registered Fund, Oakmark U.S. Equity Class and Oakmark U. S. Equity Registered Fund corresponds to approximately $120.7 million, and the AUM of Canoe Defensive U.S. Equity Class corresponds to approximately $125.5 million as at April 30, 2020, these proposed Mergers may constitute a material change for Canoe Defensive International Equity Fund.

54. The Funds have complied with Part 11 of National Instrument 81-106 Investment Fund Continuous Disclosure in connection with any decision made by the board of directors of the General Partner of the Filer to proceed with the Transaction, including the Change of Manager, the Change of Trustee and the Mergers.

Steps for the Mergers

55. It is expected that the following steps will occur prior to the Merger Date:

a. To the extent required, each Single Trust Fund (except for the Fiera Canadian Bond Fund, which will liquidate all securities in its portfolio) that is merging into a Canoe Portfolio Class Fund or Canoe Mutual Fund Trust will sell any securities in its portfolio that do not meet the investment objectives and investment strategies of the Canoe Portfolio Class Fund or Canoe Mutual Fund Trust, as applicable. As a result, a Single Trust Fund may temporarily hold cash or money market instruments and may not be fully invested in accordance with its investment objectives and investment strategies for a brief period of time prior to the Merger Date.

b. To the extent required, each Class Fund that is merging into a Canoe Portfolio Class Fund or Canoe Mutual Fund Trust will sell any securities in its portfolio that do not meet the investment objectives and investment strategies of the Canoe Portfolio Class Fund or Canoe Trust Fund, as applicable. As a result, each Class Fund may temporarily hold cash or money market instruments and, in certain instances, securities and will not be fully invested in accordance with its investment objectives and investment strategies for a brief period of time prior to the Merger Date.

c. Prior to the Merger Date, FIC will use the cash generated in the previous step or securities forming part of its portfolio to repay its debt, which consists of limited recourse notes that are redeemable on demand by each Registered Fund (the Registered Debt) and redeem the shares of each underlying Class Fund held by each Registered Fund. On or before the Merger Date, FIC will also pay sufficient capital gains dividends to its securityholders, including the Registered Funds, so that it will not have a net tax liability in respect of capital gains realized by the Class Funds and sufficient ordinary dividends to securityholders, including the Registered Funds, so that it will not have a net tax liability on Canadian dividends received by the Class Funds for its taxation year ended on the Merger Date. Any remaining tax liability will be paid from the assets of the Funds. As a result, the Registered Funds will temporarily hold cash, money market instruments and, in certain instances, securities and will not be invested in accordance with their investment objectives and investment strategies prior to the Merger Date.

56. It is expected that merger types A, B, C, and D described below will be undertaken in order, with each Merger occurring immediately after the conclusion of the preceding Merger. It is also expected that merger types E and F described below will occur simultaneously and immediately after the conclusion of Merger D.

Merger A.

Registered Fund merging into a Canoe Portfolio Class Fund

i.

The value of each Registered Fund's portfolio and other assets will be determined at the close of business on the Merger Date in accordance with its constating documents.

ii.

Each Registered Fund will distribute a sufficient amount of its net income and net realized capital gains, if any, to unitholders to ensure that each Registered Fund will not be subject to tax for the taxation year ended on the Merger Date.

iii.

On the Merger Date, CTF will acquire the assets of each Registered Fund (consisting of cash, or with respect to the Fiera Canadian Preferred Share Class, assets, received on the repayment of the Registered Debt and redemption of the Registered Fund's shares of FIC) in exchange for CTF Units. The number of CTF Units received by each Registered Fund will be equal to the number of individual investor accounts holding units of the Registered Fund.

iv.

The Canoe Portfolio Class Fund will not assume any liabilities from the Registered Funds and each Registered Fund will retain sufficient assets to satisfy its estimated liabilities, if any, as of the Merger Date.

v.

The CTF Units received by each Registered Fund will have an aggregate net asset value equal to the value of the assets that the CTF is acquiring from the Registered Fund, and the CTF Units will be issued at the applicable net asset value per unit as of the close of business on the Merger Date.

vi.

Immediately thereafter, the Registered Fund will be terminated and, upon termination, each securityholder of each Registered Fund will receive their proportionate share of the assets of the Registered Fund in specie, being a CTF Unit with equal value to their securities of the Registered Fund. Immediately following this distribution of the Registered Fund's assets to a securityholder, 0.01% of the value of each securityholder's CTF Unit will subsequently be redeemed to subscribe for shares of Canoe Fund Corp. of the equivalent series of the Canoe Portfolio Class Fund to the series of the Registered Fund previously owned by the securityholder.

vii.

The merger will occur on a taxable basis and the parties will not make any election under section 132.2 of the Tax Act.

viii.

As soon as reasonably possible following each Merger, and in any case within 60 days following the Merger Date, the applicable Registered Fund will be wound-up.

Merger B.

Registered Fund merging into a Canoe Mutual Fund Trust

i.

The value of each Registered Fund's portfolio and other assets will be determined at the close of business on the Merger Date in accordance with its constating documents.

ii.

Each Registered Fund will distribute a sufficient amount of its net income and net realized capital gains, if any, to unitholders to ensure that each Registered Fund will not be subject to tax for the taxation year ended on the Merger Date.

iii.

On the Merger Date, the applicable Canoe Mutual Fund Trust will acquire the assets of the applicable Registered Fund (consisting of cash received on the repayment of the Registered Debt and redemption of the Registered Fund's shares of its underlying Class Fund) in exchange for units of the Canoe Mutual Fund Trust.

iv.

Each applicable Canoe Mutual Fund Trust will not assume any liabilities from the applicable Registered Fund and the Registered Fund will retain sufficient assets to satisfy its estimated liabilities, if any, as of the Merger Date.

v.

The units of the Canoe Mutual Fund Trust received by the applicable Registered Fund will have an aggregate net asset value equal to the value of the assets that the Canoe Mutual Fund Trust is acquiring from the Registered Fund, and the Canoe Mutual Fund Trust units will be issued at the applicable net asset value per unit as of the close of business on the Merger Date.

vi.

Immediately thereafter, the Registered Fund will be terminated and, upon termination, each securityholder of each Registered Fund will receive their proportionate share of the assets of the Registered Fund in specie, being units of the Canoe Mutual Fund Trust with equal value to their units of the Registered Fund.

vii.

The merger will occur on a taxable basis and the parties will not make any election under section 132.2 of the Tax Act.

viii.

As soon as reasonably possible following each merger, and in any case within 60 days following the Merger Date, the applicable Registered Fund will be wound-up.

Merger C.

Single Trust Fund merging into a Canoe Portfolio Class Fund (where a significant number of investors have an accrued gain position)

i.

The value of each Single Trust Fund's portfolio and other assets will be determined at the close of business on the Merger Date in accordance with its constating documents.

ii.

Each Single Trust Fund will distribute a sufficient amount of its net income and net realized capital gains, if any, to unitholders to ensure that the Single Trust Fund will not be subject to tax for the taxation year ended on the Merger Date.

iii.

On the Merger Date, CTF will acquire the investment portfolio and other assets of each Single Trust Fund (including available cash in respect of the sale of any securities as part of the preliminary steps) in exchange for CTF Units. The number of CTF Units received by each Single Trust Fund will be equal to the aggregate of (i) the number of individual investor accounts holding units of the Single Trust Fund directly, and (ii) the number of individual investor accounts holding shares of a Class Fund representing units of the Single Trust Fund.

iv.

The Canoe Portfolio Class Fund will not assume any liabilities from the Single Trust Funds and each Single Trust Fund will retain sufficient assets to satisfy its estimated liabilities, if any, as of the Merger Date.

v.

The CTF Units received by each Single Trust Fund will have an aggregate net asset value equal to the value of the investment portfolio and other assets that the CTF is acquiring from the Single Trust Fund, and the CTF Units will be issued at the applicable net asset value per unit as of the close of business on the Merger Date.

vi.

Immediately thereafter, the Single Trust Fund will be terminated and, upon termination, each securityholder of each Single Trust Fund will receive their proportionate share of the assets of the Single Trust Fund in specie, being a CTF Unit with equal value to their units of the Single Trust Fund. Immediately following this distribution of the Single Trust Fund's assets to a securityholder, 0.01% of the value of each securityholder's CTF Unit will subsequently be redeemed to subscribe for shares of Canoe Fund Corp. of the equivalent series of the Canoe Portfolio Class Fund to the series of the Single Trust Fund previously owned by the securityholder.

vii.

CTF and each Single Trust Fund will take all necessary steps, including the making of a joint election, so that the mergers will occur on a tax-deferred basis under section 132.2 of the Tax Act to the extent of CTF's acquisition of the investment portfolio.

viii.

As soon as reasonably possible following the merger, and in any case within 60 days following the Merger Date, the Single Trust Funds will be wound-up.

Merger D.

Single Trust Fund merging into a Canoe Mutual Fund Trust

i.

The value of each Single Trust Fund's portfolio and other assets will be determined at the close of business on the Merger Date in accordance with its constating documents.

ii.

Each Single Trust Fund will distribute a sufficient amount of its net income and net realized capital gains, if any, to unitholders to ensure that the Single Trust Fund will not be subject to tax for the taxation year ended on the Merger Date.

iii.

On the Merger Date, the applicable Canoe Mutual Fund Trust will acquire the investment portfolio and other assets of the applicable Single Trust Fund (including available cash in respect of the sale of any securities as part of the preliminary steps) in exchange for units of the Canoe Mutual Fund Trust.

iv.

Each applicable Canoe Mutual Fund Trust will not assume any liabilities from the applicable Single Trust Fund and the Single Trust Fund will retain sufficient assets to satisfy its estimated liabilities, if any, as of the Merger Date.

v.

The units of the Canoe Mutual Fund Trust received by the applicable Single Trust Fund will have an aggregate net asset value equal to the value of the investment portfolio and other assets that the Canoe Mutual Fund Trust is acquiring from the Single Trust Fund, and the Canoe Mutual Fund Trust units will be issued at the applicable net asset value per unit as of the close of business on the Merger Date.

vi.

Immediately thereafter, the Single Trust Fund will be terminated and, upon termination, each securityholder of each Single Trust Fund will receive their proportionate share of the assets of the Single Trust Fund in specie, being units of the Canoe Mutual Fund Trust with equal value.

vii.

The applicable Single Trust Fund and Canoe Mutual Fund Trust will take all necessary steps, including the making of a joint election, so that the Merger will occur on a tax-deferred basis under section 132.2 of the Tax Act.

viii.

As soon as reasonably possible following each Merger, and in any case within 60 days following the Merger Date, the Single Trust Fund will be wound-up.

Merger E.

Class Fund merging into a Canoe Portfolio Class Fund

It is expected that the following steps will occur simultaneously with the steps described in Merger F, below, immediately after the conclusion of Merger D:

i.

Any CTF Units held by FIC as a consequence of a previous merger described in Merger C, above, will be redeemed by CTF for cash.

ii.

The value of each Class Fund's portfolio and other assets will be determined at the close of business on the Merger Date in accordance with its constating documents.

iii.

On the Merger Date, CTF will acquire the investment portfolio and other assets of the applicable Class Fund (including any units of a Canoe Trust Fund received by FIC in respect of a previous Merger described in Merger D, above) from FIC in exchange for CTF Units. The number of CTF Units received by FIC in respect of a Class Fund will be equal to the number of individual investor accounts holding shares of such Class Fund that is merging into a Canoe Portfolio Class Fund.

iv.

Each applicable Canoe Portfolio Class Fund will not assume any liabilities from FIC in respect of the applicable Class Fund and FIC will retain sufficient assets to satisfy the estimated liabilities in respect of the Class Fund, if any, as of the Merger Date.

v.

The CTF Units received by FIC in respect of the applicable Class Fund will have an aggregate net asset value equal to the value of the investment portfolio and other assets that the CTF is acquiring from FIC in respect of the Class Fund, and the CTF Units will be issued at the applicable net asset value per unit as of the close of business on the Merger Date.

vi.

Immediately thereafter, each securityholder of the Class Fund will exchange all of their securities of the Class Fund for a CTF Unit with equal value, and 0.01% of the value of each securityholder's CTF Unit will subsequently be redeemed to subscribe for shares of Canoe Fund Corp. of the equivalent series of the Canoe Portfolio Class Fund to the series of the Class Fund previously owned by the securityholder (corresponding to the appropriate investment strategy).

vii.

CTF and FIC will take all necessary steps, including the making of a joint election, so that the merger will occur on a tax-deferred basis under section 132.2 of the Tax Act to the extent of CTF's acquisition of the investment portfolio.

Merger F.

Class Fund merging into Canoe Mutual Fund Trust

It is expected that the following steps will occur simultaneously with the steps described in Merger E immediately after the conclusion of Merger D.

i.

The value of each Class Fund's portfolio and other assets will be determined at the close of business on the Merger Date in accordance with its constating documents.

ii.

On the Merger Date, the applicable Canoe Mutual Fund Trust will acquire the investment portfolio and other assets of the applicable Class Fund from FIC, in exchange for units of the Canoe Mutual Fund Trust.

iii.

Each applicable Canoe Mutual Fund Trust will not assume any liabilities from FIC in respect of the applicable Class Fund and FIC will retain sufficient assets to satisfy its estimated liabilities in respect of the Class Fund, if any, as of the Merger Date.

iv.

The units of the applicable Canoe Mutual Fund Trust received by FIC in respect of the Class Fund will have an aggregate net asset value equal to the value of the investment portfolio and other assets that the Canoe Mutual Fund Trust is acquiring from FIC in respect of the Class Fund, and the units of the Canoe Mutual Fund Trust will be issued at the applicable net asset value per unit as of the close of business on the Merger Date.

v.

Immediately thereafter each securityholder of the Class Fund will exchange all of their securities of the Class Fund for units of the applicable Canoe Mutual Fund Trust (corresponding to the appropriate investment strategy) with equal value.

vi.

The applicable Canoe Mutual Fund Trust and FIC will take all necessary steps, including the making of a joint election, so that the merger will occur on a tax-deferred basis under section 132.2 of the Tax Act.

vii.

As soon as reasonably possible following the Mergers, and in any case within 60 days following the Merger Date, FIC will be wound-up.

57. It is expected that, to the extent that a particular securityholder holds a CTF Unit prior to the Mergers or holds an interest in two or more of (i) a Registered Fund that is merging into a Canoe Portfolio Class Fund, (ii) a Single Trust Fund that is merging into a Canoe Portfolio Class Fund, and (iii) a Class Fund that is merging into a Canoe Portfolio Class Fund, and such interests are held in a single investment account, the securityholder may be entitled to receive more than one CTF Unit as a consequence of the Mergers described in A, C, and E above, as applicable. In such case, immediately following the steps for the Mergers, all of the securityholder's CTF Units will be consolidated into a single CTF Unit.

58. Following receipt of the written consent of all the shareholders of the common shares of FIC and the completion of the steps in Merger E and Merger F, articles of dissolution for FIC will be filed to effect the dissolution of FIC in accordance with section 237 of the Business Corporations Act (Ontario).

59. At the time of each of the Mergers, the assets of each Fund will be acceptable to the corresponding Canoe Continuing Fund.

Rationale for Approvals Sought

Change of Manager

60. Other than with respect to the changes related to the Proposed Transaction and disclosed in the Meeting Materials, the Proposed Transaction is not expected to have any material impact on the business, operations or affairs of the Funds or the securityholders of the Funds and Canoe intends to manage and administer the Funds in a similar manner as the Filer until the Merger Date.

61. All material agreements regarding the administration of the Funds will either be amended and restated by Canoe or be terminated and Canoe will enter into new agreements with the relevant service provider, as required. Subject to obtaining any necessary approvals as of Closing, Canoe will become the successor trustee of the Trust Funds, investment fund manager of the Funds and portfolio manager of the Funds (with the exception of Loomis Sayles Strategic Monthly Income Fund). The Filer will cease to act as portfolio manager of the Funds but its parent company Fiera Capital Corporation will be appointed as sub-advisor to certain Canoe Continuing Funds.

Mergers

62. The Filer and/or Canoe and not the Funds, will bear all costs and expenses associated with calling and holding the Meetings and implementing the Mergers.

63. Following the Mergers, each Canoe Continuing Fund will benefit from a larger profile in the marketplace by potentially attracting more securityholders and enabling it to maintain a "critical mass" as a result of its greater size, with the exception of the Merger of Fiera Canadian Preferred Share Registered Fund and Fiera Canadian Preferred Share Class into Canoe Preferred Share Portfolio Class, which will only be created if the Transaction closes and the Change of Manager, Change of Trustee and the Merger receive all necessary approvals, and the possible exception of the Merger of Oakmark International Equity Class and Oakmark International Equity Registered Fund into Canoe Defensive International Equity Fund where the Funds may have a portfolio of greater value than the corresponding Canoe Continuing Fund.

64. With respect to the Mergers of Fiera Canadian Preferred Share Class and Fiera Canadian Preferred Share Registered Fund into the New Canoe Fund (Mergers 3 and 14, above), Fiera Canadian Dividend Class and Fiera Canadian Dividend Registered Fund into Canoe Premium Income Fund (Mergers 5 and 16), Fiera Core Global Equity Class and Fiera Core Global Equity Registered Fund into Canoe Global Equity Fund (Mergers 8 and 19), Oakmark U.S. Equity Registered Fund and Oakmark U.S. Equity Class into Canoe Defensive U.S. Equity Portfolio Class (Mergers 9 and 20), and Oakmark International Equity Class and Oakmark International Equity Registered Fund into Canoe Defensive International Equity Fund (Mergers 10 and 21), the investment objectives and investment strategies of the Canoe Continuing Funds will be substantially similar to those of the Funds.

65. Securityholders of the Funds received detailed information about the Change of Manager, the Change of Trustee, and the Mergers in the Meeting Materials and may redeem their securities prior to the Transaction Approval Changes should they wish to do so.

66. No commission or other fee will be charged to securityholders of the Funds on the issue or exchange of securities of the Funds into the Canoe Continuing Funds.

Impact of the Approvals Sought

67. Neither the Funds nor the Canoe Funds will bear any of the costs and expenses including any portfolio realignment costs, associated with the Proposed Transaction, including the Mergers, the Change of Trustee, and the Change of Manager, except for certain fees and expenses with respect to the IRC of the Funds. Any costs and expenses associated with the Proposed Transaction will be borne by the Filer and/or Canoe, as determined between the parties.

68. Upon Closing, the individuals currently comprising the IRC of the Funds will automatically cease to be members of the IRC by operation of paragraph 3.10(1)(c) of NI 81-107. Canoe intends that the new members of the IRC of the Funds will be the same individuals that currently comprise the IRC of the Canoe Funds.

69. The Filer considers that the experience and integrity of each of the members of Canoe's current management team is apparent by their education and years of experience in the investment industry. Following the Proposed Transaction, it is expected that all of the current officers and directors of Canoe will continue on in their current capacities and that they will continue to have the requisite integrity and experience as contemplated under subparagraph 5.7(1)(a)(v) of NI 81-102.

70. The Closing will not adversely affect Canoe's financial position or its ability to fulfill its regulatory obligations.

71. Canoe and the Filer are not related parties. Except pursuant to the Proposed Transaction, there are no relationships between Canoe and the Filer (or their respective affiliates), other than a sub-advisory agreement between Canoe and the parent company of the Filer, Fiera Capital Corporation, dated as of February 22, 2019, as amended on June 6, 2019 and November 1, 2019, which will also be amended at Closing, whereby Fiera Capital Corporation acts as sub-advisor to certain Canoe Mutual Funds.

72. The Approvals Sought are not detrimental to the protection of investors in the Funds.

Decision

The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.

The decision of the principal regulator under the Legislation is that the Approvals Sought are granted.

"Darren McKall"
Investment Funds & Structured Products Branch
Ontario Securities Commission