Mackenzie Financial Corporation et al. -ss. 59(1)

IN THE MATTER OF

THE SECURITIES ACT

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

AND

IN THE MATTER OF

MACKENZIE FINANCIAL CORPORATION AND

MACKENZIE CANADIAN MANAGED YIELD CAPITAL CLASS AND

MACKENZIE U.S. MANAGED YIELD CAPITAL CLASS

ORDER

Subsection 59(1) of Schedule I of the Regulation

under the Act (the "Regulation")

UPON the application of Mackenzie Financial Corporation ("Mackenzie"), the manager of Mackenzie Canadian Managed Yield Capital Class (the "Canadian Managed Yield Fund") and Mackenzie U.S. Managed Yield Capital Class (the "U.S. Managed Yield Fund") of Mackenzie Financial Capital Corporation ("MFCC"), for an order pursuant to subsection 59(1) of Schedule I to the Regulation that the fees paid by these two mutual funds pursuant to subsection 14(2) of Schedule I to the Regulation with respect to the distribution of securities of such funds be based on the applicable percentage of the net sales in Ontario from the distribution of securities of such funds, being the rate applicable to money market mutual funds, rather than based on the applicable percentage of the aggregate gross proceeds realized in Ontario from the distribution of securities of such funds; AND UPON considering the application and the recommendations of the staff of the Ontario Securities Commission (the "Commission"); AND UPON Mackenzie having represented to the Commission as follows: 1. The Canadian Managed Yield Fund and the U.S. Managed Yield Fund (collectively the "Managed Yield Funds") are two of the 32 classes of mutual fund shares of MFCC called the Mackenzie Capital Class Funds, established under the laws of Ontario. Mackenzie is a corporation established under the laws of Ontario and is the manager of the Managed Yield Funds. 2. The Managed Yield Funds, as well as the other Mackenzie Capital Class Funds, are reporting issuers and are not in default of any requirement of the securities acts or regulations applicable in each of the provinces and territories of Canada. The securities of the Managed Yield Funds are qualified for distribution in the jurisdictions pursuant to a preliminary simplified prospectus and annual information form (the "Preliminary Prospectus") and a final simplified prospectus and annual information form dated October 26, 2000 (the "Prospectus"). 3. The Mackenzie Capital Class Funds have paid the filing fees relating to the Preliminary Prospectus that are applicable to issuers other than money market mutual funds under section 13 of Schedule I of the Regulation. Because the Mackenzie Capital Class Funds are in their first year of distribution, such funds have not yet paid any fees relating to distribution under section 14 of Schedule I of the Regulation.

4. The Managed Yield Funds are structured to provide returns that are similar to money market mutual funds. As part of their investment objective each of these funds uses options to hedge a portfolio of Canadian equities in order to approximate the rate of return provided by, in the case of the Canadian Managed Yield Fund, bankers' acceptances, or in the case of the U.S. Managed Yield Fund, the London Interbank Offered Rate. 5. The investment strategy of each of the Managed Yield Funds indicates that each fund's return will be more like a money market fund's return than an equity fund's return. The Prospectus disclosure for each of the funds further indicates that each fund is suitable as a cash component equivalent. 6. The Managed Yield Funds are generally being used by investors as equivalents to money market funds. This is evidenced by the fact that some investors who decide to purchase the Mackenzie Capital Class Funds are placing money into the Managed Yield Funds as a short-term "parking spot" for cash while determining which of the other Mackenzie Capital Class Funds the investor wishes to acquire. This also is evidenced by the fact that some investors are purchasing the Managed Yield Funds primarily to obtain the rate of return set out in the investment objectives sections of Prospectus for such funds. 7. The Managed Yield Funds are not money market funds within the meaning of section 1.1 of National Instrument 81-102 Mutual Funds ("NI 81-102") because the funds invest in synthetic cash. Accordingly, pursuant to section 14 of Schedule I of the Regulation, the Managed Yield Funds will be required to pay annual fees based on a percentage of the aggregate gross proceeds realized in Ontario from the distribution of securities of such funds (rather than based on a percentage of the net sales in Ontario from the distribution of securities of such funds, if such funds were treated as money market mutual funds). 8. If the Managed Yield Funds are required to pay fees based on gross proceeds rather than on net sales, these funds will be paying higher fees than money market mutual funds that fit within the definition of money market funds in NI 81-102. AND UPON the Commission being satisfied that to do so would not be prejudicial to the public interest; IT IS ORDERED pursuant to subsection 59(1) of Schedule I to the Regulation that the fees paid by the Canadian Managed Yield Fund and the U.S. Managed Yield Fund pursuant to subsection 14(2) of Schedule I of the Regulation with respect to the distribution of securities of these two mutual funds be based on the applicable percentage of the net sales in Ontario from the distribution of securities of such funds, being the rate applicable to money market mutual funds, rather than based on the applicable percentage of the aggregate gross proceeds realized in Ontario from the distribution of securities of such funds. AND IT IS FURTHER ORDERED pursuant to subsection 59(1) of Schedule I to the Regulation that the fees paid by the Canadian Managed Yield Fund and the U.S. Managed Yield Fund pursuant to subsection 13(3) of Schedule I of the Regulation with respect to the filing fees of these two mutual funds on each renewal are the fees applicable to money market mutual funds. PROVIDED that the Canadian Managed Yield Fund and the U.S. Managed Yield Fund each pay the difference owing between the fees paid under clause 13(3)(a) of Schedule I of the Regulation at the time of the filing of the Preliminary Prospectus, and the fees which would have been applicable under clause 13(3)(b) of Schedule I of the Regulation within 10 business days of the date of this Order. April 3, 2001. Paul M. Moore, Howard I. Wetston