May 31, 2022
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 Hamilton Capital Partners Inc. (the Filer)
AND
Hamilton Enhanced Canadian Bank ETF and
Hamilton Enhanced Multi-Sector Covered Call ETF (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) that the time limits for the renewal of the long form prospectus of the Funds dated July 8, 2021, as amended by amendment no. 1 thereto dated October 15, 2021 and amendment no. 2 thereto dated May 6, 2022 (together, the Current Prospectus) be extended to those time limits that would apply if the lapse date of the Current Prospectus was September 8, 2022 (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 subsection 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, New Brunswick, Newfoundland and Labrador, Nova Scotia, Quebec, Prince Edward Island, Northwest Territories, Nunavut, and Yukon (together with Ontario, the Canadian Jurisdictions).
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:
The Filer is a corporation incorporated under the laws of Ontario with a head office in Toronto.
The Filer currently is registered as: (i) an investment fund manager in Ontario, Quebec and Newfoundland & Labrador; (ii) an exempt market dealer in Ontario; and (iii) a portfolio manager in Ontario.
The Filer is the investment fund manager of the Funds.
Each Fund is an open-ended, exchange-traded, mutual fund trust established under the laws of Ontario. The Funds are each reporting issuers as defined in the securities legislation of each of the Canadian Jurisdictions. Securities of the Funds are listed for trading on the Toronto Stock Exchange.
Neither the Filer nor the Funds are in default of securities legislation in any of the Canadian Jurisdictions.
The Funds currently distribute their securities in the Canadian Jurisdictions under the Current Prospectus.
Pursuant to subsection 62(1) of the Securities Act (Ontario) (the Act), the lapse date of the Funds is July 8, 2022 (the Lapse Date). Accordingly, under subsection 62(2) of the Act, the distribution of securities of each of the Funds would have to cease on the Lapse Date unless: (i) the Funds file a pro forma long form prospectus at least 30 days prior to the Lapse Date; (ii) the final long form prospectus is filed no later than 10 days after the Lapse Date; and (iii) a receipt for the final long form prospectus is obtained within 20 days of the Lapse Date.
Without the Exemption Sought, the renewal pro forma prospectus relating to the Funds is therefore required to be filed by June 8, 2022 (the Pro Forma Deadline) in order for securities of each of the Funds to continue to be distributed after the Lapse Date.
The Filer is considering adding an additional, new, fund to the Funds’ prospectus (the New Fund). The terms of such New Fund have not been finalized. In order to create a single prospectus for the Funds and the New Fund, renewal documentation and disclosure relating to the Funds and the New Fund will need to be finalized, combined and translated.
Offering the Funds and the New Fund under one prospectus would facilitate the distribution of the Funds and the New Fund in the Canadian Jurisdictions under the same prospectus and enable the Filer to streamline disclosure across the Filer’s fund platform. As the New Fund will be managed by the Filer, established under the same declaration of trust as the Funds, and share a number of common features with the Funds, offering the New Fund under the same prospectus as the Funds will allow investors to more easily compare their features.
The process being undertaken by the Filer to include disclosure relating to the New Fund in the same prospectus as the Funds requires additional time in order to properly update and streamline and translate the disclosure of the Funds and the New Fund. Given the time required to perform these tasks accurately, the Filer does not have sufficient time to finalize and file the preliminary and pro forma prospectus combining the Funds and the New Fund by the Pro Forma Deadline.
The terms of the New Fund have not been finalized and therefore including the disclosure relating to the New Fund in a combined pro forma and preliminary prospectus would not be possible if such combined pro forma and preliminary prospectus was required to be filed by the Pro Forma Deadline.
Providing an extension for the Lapse Date will permit the New Fund to be included in the renewal prospectus of the Funds.
Other than as already disclosed in accordance with the requirements of National Instrument 81-106 Investment Fund Continuous Disclosure, there have been no material changes in the affairs in either of the Funds since the date of the Current Prospectus. Accordingly, the Current Prospectus and ETF Facts documents of the Funds represent current information regarding the Funds.
Given the disclosure obligations of the Funds, should an additional material change in the affairs of the Funds occur, the Current Prospectus and current ETF Facts documents of the Funds will be further amended as required under applicable legislation.
New investors in the Funds will receive delivery of the most recently filed ETF Facts documents of the Funds, as applicable. The Current Prospectus will still be available upon request.
The Exemption Sought will not affect the accuracy of the information contained in the Current Prospectus or the respectively filed ETF Facts documents of the Funds, and therefore will not be prejudicial to the public interest.
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.
“Darren McKall”
Darren McKall
Manager, Investment Funds and Structured Products Branch
Ontario Securities Commission
Application #2022/0256