Headnote

NP 11-203 – MI 61-101 – take-over bid and subsequent business combination – MI 61-101 requires sending of information circular and holding of meeting in connection with second step business combination – target’s declaration of trust provides that a resolution in writing executed by unitholders holding more than 66 2/3% of the outstanding units valid as if such voting rights had been exercised at a meeting of unitholders – relief granted from requirement that information circular be sent and meeting be held – minority approval to be obtained albeit in writing rather than at a meeting of unitholders.

Applicable Legislative Provisions

Multilateral Instrument 11-102 – Passport System

National Policy 11-203 – Process for Exemptive Relief Applications in Multiple Jurisdiction

MI 61-101 – Protection of Minority Security Holders in Special Transactions

Date: December 1, 2008

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 The Take-OVER BID FOR ATS Andlauer Income Fund BY 2186940 Ontario Inc., a wholly-owned subsidiary of

Andlauer Management Group Inc.

(the “Filer”)

Decision

Background

The principal regulator in the Jurisdiction has received an application from the Filer for a decision under the securities legislation of the Jurisdiction of the principal regulator (the “Legislation”) for relief from Section 4.2(2) of Multilateral Instrument 61-101 - Protection of Minority Security Holders in Special Transactions (“MI 61-101”) that would require the Filer proposing to carry out a business combination in connection with a take-over bid for all of the outstanding trust units of ATS Andlauer Income Fund (the “Fund”), to: (a) call a meeting of holders of units of the Fund (the “Unitholders”) to approve any Compulsory Acquisition (as defined below) or any Subsequent Acquisition Transaction (as defined below), and (b) to send an information circular to Unitholders in connection with such a Compulsory Acquisition or Subsequent Acquisition Transaction (the “Exemption 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, 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 Quebec.

Interpretation

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

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

1. The Filer is a corporation incorporated under the Business Corporations Act (Ontario) (“OBCA”) as “2186940 Ontario Inc.” on October 7, 2008 and is a wholly-owned subsidiary of AMG. The registered office of the Filer is located at Suite 3800, 200 Bay Street, Toronto, Ontario, M5J 2Z4.

2. Andlauer Management Group Inc. (“AMG”) was incorporated under the OBCA on March 24, 1994. AMG’s head and registered office is located at Suite 630, 190 Attwell Drive, Etobicoke, Ontario, M9W 6H8. AMG is a private holding company, all of the outstanding shares of which are held directly or indirectly by Michael Andlauer, a trustee of the Fund and the President and Chief Executive Officer of the GP (as defined below). As of October 17, 2008, AMG beneficially owns or controls an aggregate of 568,506 Units (as defined below) and 2,316,442 special voting trust units of the Fund (the “Special Voting Units”). The Special Voting Units have been issued in relation to the Exchangeable LP Units (as defined below) held by a subsidiary of AMG, which are exchangeable into 2,316,442 Units. On a fully-diluted basis, assuming the exchange of all of the Exchangeable LP Units into Units, the Filer and its affiliates currently own, directly or indirectly, 25.3% of the outstanding Units.

3. The Fund is an unincorporated, open-ended trust established under the laws of the Province of Ontario pursuant to an amended and restated declaration of trust dated August 22, 2005 (the “Declaration of Trust”). The Fund does not carry on any active business but indirectly holds a 79.71% interest in the ATS Andlauer Transportation Services Limited Partnership (the “Partnership”), which is a full-service transportation solutions provider across Canada.

4. The Fund is authorized to issue an unlimited number of Units and Special Voting Units. Based on publicly available information, the Filer understands that as of October 17, 2008, 9,096,700 Units and 2,316,442 Special Voting Units were issued and outstanding. The Units are listed and posted for trading on the Toronto Stock Exchange under the symbol “ATS.UN”. All of the issued and outstanding Units are held by CDS Clearing and Depository Services Inc. (“CDS”) in book-entry only form.

5. The Fund is a reporting issuer or the equivalent in all of the provinces and territories of Canada.

6. The Partnership is a limited partnership established under the laws of the Province of Manitoba. The Partnership had issued as of October 17, 2008, 9,096,700 ordinary units of the Partnership (the “Ordinary LP Units”) and 2,316,442 exchangeable units of the Partnership (the “Exchangeable LP Units”). All of the outstanding Ordinary LP Units are held by ATS Andlauer Operating Trust (the “Operating Trust”), all of the trust units of which are owned by the Fund. All of the outstanding Exchangeable LP Units (each of which is exchangeable into one Unit) are held by a subsidiary of AMG. The general partner of the Partnership is ATS Andlauer Transportation Services GP Inc. (the “GP”), a corporation incorporated under the laws of Canada. The GP also acts as administrator of the Fund and Operating Trust pursuant to the terms of an administration agreement.

7. The principal head office of the Fund and Partnership is Suite 600, 190 Attwell Drive, Etobicoke, Ontario, Canada, M9W 6H8.

8. On October 10, 2008, the Filer entered into lock-up agreements (the “Lock-Up Agreements”) with certain institutional investors, certain members of management and other Unitholders (collectively, the “Lock-Up Unitholders”) under which those holders have agreed to tender all Units owned by them, or over which they exercise control or direction, to the Offer, subject to certain conditions. The Lock-Up Unitholders own, or exercise control or direction over, an aggregate of 3,509,088 Units, representing approximately 30.7% of the outstanding Units, on a fully-diluted basis. The Lock-Up Agreements constitute “Permitted Lock-Up Agreements” within the meaning of the Unitholder Rights Plan.

9. The Filer has made an offer (the “Offer”) to purchase all of the issued and outstanding trust units (other than the special voting trust units) of the Fund together with the rights associated therewith under the unitholder rights plan of the Fund (collectively, the “Units”), other than any Units owned, directly or indirectly, by the Applicant and its affiliates.

10. The Filer commenced the Offer on October 20, 2008 by delivering the Offer and the accompanying take-over bid circular (the “Bid Circular”), prepared in compliance with the applicable legislation, to the Unitholders, offering to acquire the Units at a price of $11.75 in cash until 10:00 a.m. (Toronto time) on November 25, 2008, unless extended or withdrawn.

11. On November 21, 2008, the Filer entered into two additional lock-up agreements (the “Additional Lock-Up Agreements”) with certain holders of Units (the “Additional Lock-Up Unitholders”) under which they agreed to tender all Units owned by them, or over which they exercise control or direction, to the Offer (as amended in paragraph 12 below). The Additional Lock-Up Unitholders own, or exercise control or direction over, an aggregate of 215,797 Units, representing approximately 1.9% of the Units on a fully-diluted basis. The Additional Lock-Up Agreements constitute “Permitted Lock-up Agreements” within the meaning of the Unitholder Rights Plan.

12. On November 24, 2008, the Filer amended the Offer pursuant to a notice of extension and variation by reducing the Offer price from $11.75 per Unit to $10.75 per Unit in cash and extending the Offer to 10:00 a.m. (Toronto time) on December 5, 2008, unless withdrawn or further extended by the Offeror. The Lock-Up Unitholders consented in writing to the reduction of the Offer price, in accordance with the terms of the Lock-Up Agreements.

13. The Offer includes the following conditions, among others:

(a) there shall have been validly deposited under the Offer and not withdrawn: (i) together with Units and Exchangeable LP Units owned, directly or indirectly, by the Filer and its affiliates, more than 66⅔% of the Units outstanding at the time of take up (calculated on a fully-diluted basis); and (ii) at least a majority of the Units outstanding at the time of take up (calculated on a fully-diluted basis), the votes attached to which would be included in the minority approval of a second step business combination pursuant to MI 61-101 (collectively, the “Minimum Tender Condition”); and

(b) the Filer shall have determined in its sole judgment that, on terms satisfactory to the Filer, the unitholder rights plan of the Fund dated August 12, 2008 between the Fund and CIBC Melon Trust Company, as amended on October 17, 2008 (the “Unitholder Rights Plan”) will not operate to adversely affect the Offer, the Filer or AMG, either before or on consummation of the Offer, the acquisition by the Filer of any Units under the Offer or any Compulsory Acquisition or Subsequent Acquisition.

14. Section 14.6 of the Declaration of Trust would permit the Filer to acquire the Units not tendered to the Offer (the “Remaining Units”) for the same consideration per Unit as payable under the Offer if, within the time provided in the Offer for its acceptance or within 120 days after the date the Offer is made (whichever period is longer), the Offer is accepted by the holders of at least 90% of the Units (on a fully-diluted basis), other than the Units beneficially owned, or over which control or direction is exercised, at the date of the Offer by the Filer or any associate or affiliate of the Filer, and the Filer has taken up and paid for the Units deposited to the Offer (as amended as described in paragraph 13 below, a “Compulsory Acquisition”).

15. In connection with a Compulsory Acquisition, if available and if the Filer elects to proceed thereunder, or a Subsequent Acquisition Transaction (as defined below), the Filer intends to amend Section 14.6 of the Declaration of Trust by the Written Resolution (as defined below) to provide that Units held by each Unitholder who did not accept the Offer (which includes a subsequent holder of a Unit that is the subject of the Offer) (in each case, a “Non-Tendering Offeree”) will be deemed to have been transferred to the Filer immediately on the giving of the “Offeror’s Notice”, as defined in the Declaration of Trust, (as opposed to within 30 days after the sending of the Offeror’s Notice as currently provided for in the Declaration of Trust) and that those Non-Tendering Offerees will cease to have any rights as Unitholders from and after that time, other than the right to be paid the same consideration that the Filer would have paid to the Non-Tendering Offerees if they had tendered those Units to the Offer.

16. If the Compulsory Acquisition is not available to the Filer or if the Filer elects not to proceed under those provisions, the Filer currently intends (a) to cause the provisions of the Declaration of Trust to be amended to permit the Filer to acquire the Remaining Units for the same consideration per Unit as payable under the Offer if the Minimum Tender Condition has been satisfied (as opposed to the 90% threshold referred to above in connection with a Compulsory Acquisition) (the acquisition following such amendment, a “Subsequent Acquisition Transaction”); and (b) to proceed with a Subsequent Acquisition Transaction to acquire the Remaining Units as permitted by the Declaration of Trust, as so amended.

17. Rather than seeking the approval of Voting Unitholders for a Compulsory Acquisition or a Subsequent Acquisition Transaction at a special meeting called for that purpose, the Filer intends to rely on Section 12.10 of the Declaration of Trust, which permits resolutions to be approved in writing by voting unitholders holding more than 66⅔% of the outstanding Units and Special Voting Units (the “Written Resolution”).

18. A Compulsory Acquisition or a Subsequent Acquisition Transaction would constitute a “business combination” within the meaning of MI 61-101.

19. To effect either a Compulsory Acquisition or a Subsequent Acquisition Transaction, the Filer will comply with the provisions of MI 61-101 and will evidence minority approval (as the term is defined in MI 61-101) (“Minority Approval”) calculated in accordance with the terms of Part 8 of MI 61-101, by the Written Resolution rather than at a meeting of Unitholders.

20. The Bid Circular contains the disclosure required by applicable securities laws, including, without limitation, the take-over bid provisions and form requirements of securities legislation including Ontario Securities Commission Rule 62-504 – Take-over Bids and Issuer Bids and the provisions of MI 61-101 relating to the disclosure required to be included in a bid circular for an insider bid and in respect of a second-step business combination such as a Compulsory Acquisition or a Subsequent Acquisition Transaction.

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 Exemption Sought is granted provided that Minority Approval shall have been obtained by Written Resolution.

“Naizam Kanji”

Name: Naizam Kanji

Manager, Ontario Securities Commission