Northwest & Ethical Investments L.P. and Credential Asset Management Inc.
Headnote
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- Relief granted from the requirement in s. 3.2(2), NI 81-101 to deliver a fund facts document to investors for purchases of mutual fund securities of certain series under automatic switching programs -- Tiered series offering lower combined management and administration fees than the introductory series, as applicable, that the investor initially purchased securities in, based on the size of a fund investment -- Investment fund manager initiating automatic switches in and out of tiered series on behalf of investors when their investments satisfy or cease to meet eligibility requirements of tiered series -- Automatic switches between series of a fund triggering a distribution of securities which requires delivery of a fund facts document -- Relief granted from the requirement to deliver a fund facts document to investors for purchases of series securities made under automatic switching programs subject to compliance with certain notification and disclosure requirements in the simplified prospectus and fund facts document -- Relief granted from the requirement to prepare a fund facts document for each series of securities of a mutual fund in accordance with the form requirements in Form 81-101F3 and the requirement that the fund facts document contain only information that is specifically required or permitted to be in Form 81-101F3 so that the fund facts document delivered to investors in the automatic switching program will provide disclosure relating to the automatic switching program and the tiered series of the fund, subject to certain conditions.
Applicable Legislative Provisions
National Instrument 81-101 Mutual Fund Prospectus Disclosure, ss. 3.2.01, 4.1(3)(a) and (d), 6.1.
June 28, 2018
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 NORTHWEST & ETHICAL INVESTMENTS L.P. (NEI) AND IN THE MATTER OF CREDENTIAL ASSET MANAGEMENT INC. (the Representative Dealer, and together with NEI, the Filers)
DECISION
Background
The principal regulator in the Jurisdiction has received an application from NEI on behalf of each existing mutual fund listed in Schedule "A" (collectively, the Existing Funds) and any mutual fund that NEI may manage in the future (the Future Funds, and together with the Existing Funds, the Funds and each, a Fund) and the Representative Dealer for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) exempting:
(a) each dealer who trades in securities of the Funds (a Dealer) from the requirement in section 3.2.01 of National Instrument 81-101 Mutual Fund Prospectus Disclosure (NI 81-101) for a dealer to deliver or send the most recently-filed fund facts document (a Fund Facts) before the dealer accepts an instruction from a purchaser for the purchase of a security (the Pre-Sale Fund Facts Delivery Requirement) in respect of purchases of Fee Tier Series (defined below) or Main Series (defined below) securities of the Funds that are made pursuant to Automatic Switches (defined below) (the Fund Facts Delivery Relief); and
(b) the Funds from the requirement in section 2.1 of NI 81-101 to prepare a Fund Facts in the form of Form 81-101F3 Contents of Fund Facts Document (Form 81-101F3), to permit the Funds to deviate from certain requirements in Form 81-101F3 in order to prepare a Multiple Fund Facts Document (as defined below) that includes the Program Disclosure (as defined below) (the Multiple Fund Facts Relief, and together with the Fund Facts Delivery Relief, 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 the application; and
(b) the Filers have 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 the other provinces and territories of Canada (together with the Jurisdiction, the Jurisdictions).
Interpretation
Terms defined in MI 11-102 and National Instrument 14-101 Definitions have the same meanings if used in this decision unless otherwise defined.
Representations
This decision is based on the following facts represented by the Filers:
NEI
1. NEI is a limited partnership governed by the laws of the province of Ontario with its head office in Toronto, Ontario. The general partner of NEI is Northwest & Ethical Investments Inc. Northwest & Ethical Investments Inc. is a wholly-owned subsidiary of Aviso Wealth Inc. (Aviso). Aviso is a wholly-owned subsidiary of Aviso Wealth LP, which in turn is 50% owned by Desjardins Financial Holdings Inc. and 50% owned by a limited partnership owned by the five Provincial Credit Union Centrals and CUMIS Group Limited.
2. NEI is registered as an investment fund manager in British Columbia, Newfoundland and Labrador, Ontario and Québec, as a portfolio manager and a commodity trading manager in Ontario, and as an exempt market dealer in British Columbia, Ontario, Québec and Saskatchewan.
3. NEI is the manager, trustee and portfolio manager of the Existing Funds and will be the manager and/or trustee of any Future Funds.
4. NEI is not in default of securities legislation in any of the Jurisdictions.
The Funds
5. Each Fund is, or will be, an open-end mutual fund trust created under the laws of Ontario or an open-end mutual fund that is a class of shares of a mutual fund corporation incorporated under the laws of Ontario.
6. Each Fund is, or will be, a reporting issuer under the laws of the Jurisdictions and subject to National Instrument 81-102 Investment Funds. The securities of the Funds are, or will be, qualified for distribution pursuant to a simplified prospectus, annual information form and Fund Facts that have been, or will be, prepared and filed in accordance with NI 81-101 (the Prospectus). The securities of the Existing Funds are currently offered under a simplified prospectus, annual information form and Fund Facts dated June 8, 2017, as amended. The simplified prospectus and annual information form are expected to be renewed on or about June 18, 2018.
7. Each of the Existing Funds currently offers Series A, Series F and Series I securities. Certain of the Existing Funds also offer Series B, Series T, Series P and Series PF securities. Series A and Series F securities, together with additional series NEI may offer in the future which have higher combined management and fixed administration fees than the Fee Tier Series (defined below) are referred to herein as the Main Series.
8. Series A securities of the Existing Funds, other than NEI Money Market Fund and NEI Conservative Yield Portfolio, are currently offered under four different purchase options, including a front-end sales charge option (Front-end option). Series A securities of NEI Money Market Fund and NEI Conservative Yield Portfolio, and Series P securities of the Existing Funds are only offered under the Front-end option. Under the Front-end option, investors may have to pay a negotiated commission of up to 5% to their dealer at the time they purchase securities, while under the various other sales charge options, no commission is paid by the investor at the time of purchase, but the investor will be required to pay a deferred sales charge if they redeem within specified time periods.
9. Series F securities of the Funds are intended for investors participating in programs that do not require the payment of sales charges by investors and do not require the payment of trailing commissions to investment professionals or dealers from NEI.
10. Series P and Series PF securities of the Funds are charged lower management fees than the Main Series. Series P and Series PF securities are only available to investors who have a minimum investment amount of $100,000 on an account basis in certain of the investor's account(s) as set forth in the Prospectus. Series P and Series PF securities of the Funds, together with additional series NEI may offer in the future which have lower combined management and fixed administration fees than the Main Series, are referred to herein as the Fee Tier Series.
11. The Existing Funds are not in default of securities legislation in any of the Jurisdictions.
The Representative Dealer
12. Securities of the Funds are, or will be, distributed through Dealers who may or may not be affiliated with NEI, including the Representative Dealer.
13. The Representative Dealer is a member of the Mutual Fund Dealers Association of Canada and is registered in the category of mutual fund dealer in each of the provinces of Canada.
14. Each Dealer is, or will be, registered as a dealer in one or more of the Jurisdictions. Other than Dealers who are registered as exempt market dealers, the Dealers are, or will be, members of either the Investment Industry Regulatory Organization of Canada or the Mutual Fund Dealers Association of Canada.
15. The Representative Dealer is not in default of securities legislation in any of the Jurisdictions.
The Automatic Switch Program
16. NEI proposes to implement a preferred pricing program (the Automatic Switch Program) based on the value of the holdings of the Funds in an investor's account(s). The Automatic Switch Program is expected to go into effect on or about June 28, 2018 (the Implementation Date), and includes an automatic switch feature between certain Main Series and the Fee Tier Series.
17. NEI proposes to automatically switch investors in Series A (who purchased their securities under the Front-end option) into Series P once their account(s) meets the minimum investment threshold for Series P, and to switch investors in Series F into Series PF once their account(s) meets the minimum investment threshold for Series PF, where such Series P and Series PF securities of a Fund are available. In addition, for any Main Series created in the future, NEI may create corresponding Fee Tier Series, which will feature lower combined management and fixed administration fees compared to the Main Series. Any future Fee Tier Series will feature similar minimum investment thresholds as described above for Series P and Series PF securities. NEI will automatically switch investors in any future Main Series into their corresponding Fee Tier Series once they meet the applicable minimum investment threshold for such Fee Tier Series.
18. Under the Automatic Switch Program, NEI will program its system to monitor each investor's account(s) on a periodic basis to determine which Fee Tier Series the investor qualifies for and automatically switch (an Automatic Switch) the investor's investments to the appropriate Fee Tier Series or Main Series, without the Dealer or investor having to initiate the trade, as described in representations #19 and #20 below.
19. NEI intends to calculate an investor's holdings after each transaction, so that if an investor passes the minimum investment threshold for a Fee Tier Series after a purchase, or dips below the minimum investment threshold for a Fee Tier Series after a redemption, NEI will effect an automatic switch to the Main Series or Fee Tier Series of the same Fund, as applicable. Additionally, if on the last day of a month, the market value of an investor's holdings exceeds the minimum investment threshold for a Fee Tier Series, NEI will automatically switch the investor from the Main Series to the Fee Tier Series of the same Fund. NEI anticipates that such monitoring and automatic switching may occur more frequently in the future.
20. Once an investor has qualified for a Fee Tier Series, the investor will continue to enjoy the benefit of lower combined management and fixed administration fees associated with such Fee Tier Series, unless the investor redeems sufficient securities that their account holdings fall below such Fee Tier Series' minimum investment threshold. In such a case, NEI will switch the investor from the Fee Tier Series to the corresponding Main Series of a Fund (subject to the exception described in paragraph 21 below). However, if an investor's account holdings fall below a Fee Tier Series' minimum investment threshold due to negative fund performance, that investor will continue to enjoy the benefit of lower combined management and fixed administration fees associated with such Fee Tier Series.
21. Existing investors in Series P and Series PF as at the Implementation Date will be exempt from the Automatic Switch Program. They will not be switched into Series A and Series F (as applicable) if their account holdings fall below $100,000.
22. Further to each Automatic Switch to the appropriate Fee Tier Series, an investor would continue to hold securities in the same Fund(s) with the only material difference to the investor being that the combined management and fixed administration fees associated with the Fee Tier Series will be lower than those associated with the previously-held Main Series, for which the investor originally subscribed or acquired.
23. Further to each Automatic Switch to the appropriate Main Series, an investor would continue to hold securities in the same Fund(s) with the only material difference to the investor being that the combined management and fixed administration fees associated with the Main Series will be higher than those associated with the previously-held Fee Tier Series.
24. The Automatic Switches have no adverse tax consequences on investors under current Canadian tax legislation.
25. No sales charges, switch fees or other fees will be payable by the investor upon an Automatic Switch.
26. The trailing commissions for a Main Series and its corresponding Fee Tier Series will be the same.
Fund Facts Delivery Relief
27. Each Automatic Switch will entail a redemption of securities of Main Series securities or Fee Tier Series securities, as the case may be, immediately followed by a purchase of securities of the applicable Fee Tier Series securities or Main Series securities of the same Fund, as the case may be. Each purchase of securities completed as part of an Automatic Switch will be a "distribution" under the Legislation that triggers the Pre-Sale Fund Facts Delivery Requirement.
28. After the Implementation Date, a Multiple Fund Facts Document (as defined below) containing the Program Disclosure (as defined below) will be delivered to investors before their first purchase of Main Series securities of a Fund or, if eligible, securities of a Fee Tier Series of a Fund in accordance with the Pre-Sale Fund Facts Delivery Requirement.
29. While NEI will initiate each trade done as part of the Automatic Switches, each Dealer does not propose to deliver a Multiple Fund Facts Document to investors in connection with the switch into Fee Tier Series or Main Series made pursuant to Automatic Switches since:
(a) holders of Main Series securities as at the Implementation Date would have received a Fund Facts disclosing the higher level of fees which applied to the particular series of securities for which they initially subscribed;
(b) holders of Fee Tier Series securities as at the Implementation Date will be exempt from the Automatic Switch Program. They will not be switched into the applicable Main Series if their account holdings fall below the minimum investment threshold; and
(c) after the Implementation Date, new purchasers of Main Series, securities of a Fund or, if eligible, securities of a Fee Tier Series of a Fund, would have, upon their initial purchase of such securities, received a Multiple Fund Facts Document incorporating all relevant information about all series of the applicable Program Set (as defined below), and investors would derive little benefit from receiving a further Multiple Fund Facts Document for each Automatic Switch.
30. Although each Dealer does not propose to deliver a Multiple Fund Facts Document (as defined below) to investors in connection with each Automatic Switch, the most recently filed Multiple Fund Facts Document (as defined below) for each series will still be available to investors on NEI's website.
31. Trade confirmations will be delivered to investors in connection with each trade done further to an Automatic Switch. Details of the changes in series of securities held will be reflected in the account statements sent to investors for the month in which the Automatic Switch occurred.
32. Prior to the Implementation Date, NEI will include details about the Automatic Switch Program in the simplified prospectus, annual information form and Fund Facts of the Existing Funds at renewal on or about June 18, 2018.
33. NEI will communicate extensively with Dealers and their advisors about the Automatic Switches so that Dealers and their advisors will be equipped to appropriately notify existing investors in the Main Series of the Automatic Switches applying to their investments and to appropriately advise new investors of the Automatic Switch Program.
34. In the absence of the Fund Facts Delivery Relief, the Automatic Switches are not capable of being implemented without compliance with the Pre-Sale Fund Facts Delivery Requirement.
Multiple Fund Facts Relief
35. NEI proposes to prepare, for each of the Funds, a single, Multiple Fund Facts document (a Multiple Fund Facts Document) for each set of Main Series and their corresponding Fee Tier Series (each, a Program Set).
36. Each Multiple Fund Facts Document will include the information required by Form 81-101F3 for each of the series in the applicable Program Set, except for the past performance section, which will only disclose past performance data of the applicable Main Series, as further described below.
37. Specifically, for each Multiple Fund Facts Document, NEI proposes to deviate from the following requirements in Form 81-101F3:
(a) General Instructions (10) and (16), to permit the Multiple Fund Facts Document to be the Fund Facts for, and disclose information relating to, each of the series in the applicable Program Set, except as further described below;
(b) Item 1(c.1) of Part I, to permit the Multiple Fund Facts Document to name each of the series in the applicable Program Set in the heading;
(c) Item 1(e) of Part I, to permit the Multiple Fund Facts Document to name each of the series in the applicable Program Set in the introduction to the Fund Facts;
(d) Instruction (0.1) of Item 2 of Part I, to permit the Multiple Fund Facts Document to identify the fund codes of each of the series in the applicable Program Set;
(e) Instruction (1) of Item 2 of Part I, to permit the Multiple Fund Facts Document to list the date that each of the series in the applicable Program Set first became available to the public;
(f) Instruction (3) of Item 2 of Part I, to permit the Multiple Fund Facts Document to disclose the management expense ratio (the MER) of only the applicable Main Series in the applicable Program Set;
(g) Instruction (6) of Item 2 of Part I, to permit the Multiple Fund Facts Document to specify the minimum investment amount for only the applicable Main Series in the applicable Program Set;
(h) General Instruction (8), to permit the Multiple Fund Facts Document to include a footnote under the "Quick Facts" table that:
(1) states that the Fund Facts pertains to all of the series in the applicable Program Set;
(2) cross-references the "How much does it cost?" section of the Fund Facts for further details about the Automatic Switch Program;
(3) cross-references the fee decrease table under the subheading "Fund expenses" of the Fund Facts for further details about the minimum investment amount for each of the Fee Tier Series in the applicable Program Set; and
(4) cross-references the fund expenses table under the "Fund expenses" subsection of the Fund Facts document for further details about the MER for each of the Fee Tier Series securities in the applicable Program Set;
(i) Item 5(1) of Part I, to permit the Multiple Fund Facts Document to:
(1) reference only the applicable Main Series in the introduction under the heading "How has the fund performed?"; and
(2) include, as a part of the introduction, disclosure explaining that the performance for each of the applicable Fee Tier Series in the Program Set would be similar to the performance of the corresponding Main Series, but would vary as a result of the difference in fees compared to the corresponding Main Series, as set out in the fee decrease table under the subheading "Fund expenses";
(j) Instruction (4) of Item 5 of Part I, to permit a Multiple Fund Facts Document to show the required performance data under the sub-headings "Year-by-year returns," "Best and worst 3-month returns," and "Average return" relating only to the applicable Main Series;
(k) Item 1(1.1) of Part II, to permit a Multiple Fund Facts Document to:
(1) refer to all of the series in the applicable Program Set in the introductory statement under the heading "How much does it cost?"; and
(2) include, as a part of the introductory statement, a summary of the Automatic Switch Program, consisting of:
(a) a statement explaining that the Automatic Switch Program offers separate series of securities that charge lower combined management and administration fees than the corresponding Main Series;
(b) a statement explaining the scenarios in which the Automatic Switches will be made, including Automatic Switches made due to the investor no longer meeting the eligibility requirements for a particular Fee Tier Series;
(c) a statement explaining that an investor will not pay higher combined management and administration fees than those charged to the applicable Main Series as a result of the Automatic Switches;
(d) a cross-reference to the fee decrease table under the subheading "Fund expenses";
(e) a cross-reference to specific sections of the simplified prospectus of the Funds for more details about the Automatic Switch Program; and
(f) a statement disclosing that investors should speak to their representative for more details about the Automatic Switch Program;
(l) Instruction (1) of Item 1 of Part II, to permit a Multiple Fund Facts Document to refer to all of the series in the applicable Program Set in the introduction under the subheading "Sales charges", if applicable;
(m) Item 1(1.3)(2) of Part II, to permit a Multiple Fund Facts Document, where the applicable Fund is not new:
(1) to disclose the MER and fund expenses of each of the series in the applicable Program Set, and where certain information is not available for a particular series, to state "not available" in the corresponding part of the table; and
(2) add a row in the table:
(i) in which the first column states "For every $1,000 invested, this equals" and
(ii) which discloses the respective equivalent dollar amounts of the fund expenses of each series included in the table for each $1,000 investment;
(n) Item 1(1.3)(3) of Part II, to permit a Multiple Fund Facts Document, where the applicable Fund and all series in the applicable Program Set are not new, to include, instead of the mandated statement above the fund expenses table:
(1) a statement explaining that the applicable Main Series has the highest combined management and administration fees among all of the series in the applicable Program Set; and
(2) a statement stating "As of [the date of the most recently-filed management report of fund performance], the fund expenses were as follows:";
(o) Item 1(1.3)(3) of Part II, to permit a Multiple Fund Facts Document, where the applicable Fund is not new but where some of the series in the applicable Program Set are new, to include, instead of the mandated statement above the fund expenses table:
(1) a statement explaining that the applicable Main Series has the highest combined management and administration fees among all of the series in the applicable Program Set;
(2) a statement disclosing that the fund expenses information below is not available for certain series because they are new, as indicated below; and
(3) a statement stating "As of [the date of the most recently filed management report of fund performance], the fund expenses were as follows:";
(p) Item 1.3(4) of Part II, to permit a Multiple Fund Facts Document, where the applicable Fund is new, to:
(1) include disclosure explaining that the applicable Main Series has the highest combined management and administration fees among all of the series in the applicable Program Set;
(2) disclose the rates of the management fee and administration fee of only the applicable Main Series; and
(3) for only the applicable Main Series, disclose that the operating expenses and trading costs are not yet available because it is new; and
(q) General Instruction (8), to permit a Multiple Fund Facts Document to include, at the end of the disclosure under the subheading "Fund expenses":
(1) a table that discloses:
(a) the name of, and qualifying investment amounts associated with, each of the series in the applicable Program Set; and
(b) the combined management and administration fee decrease of each of the Fee Tier Series in the applicable Program Set from the combined management and administration fee of the applicable Main Series, shown in percentage terms; and
(2) an introduction to the table stating that the table sets out the combined management and administration fee decrease of each of the Fee Tier Series in the applicable Program Set from the combined management and administration fee of the applicable Main Series
(collectively, the Program Disclosure).
38. NEI submits that, given that each of the Main Series and Fee Tier Series belong to the Automatic Switch Program, and an investor in the Automatic Switch Program would make one investment decision at the outset by purchasing the Main Series of a Fund or, if eligible, securities of a Fee Tier Series of a Fund, a Multiple Fund Facts Document containing the Program Disclosure will provide investors with more comprehensive disclosure about the Automatic Switch Program and each of the series in the applicable Program Set compared to disclosure in separate Fund Facts for each of the series in the applicable Program Set.
39. Since, if the Fund Facts Delivery Relief described above is granted, the Fund Facts for each of the Fee Tier Series would not be delivered in connection with an Automatic Switch, NEI submits that there is little benefit to preparing separate Fund Facts for each of the series in the applicable Program Set. NEI submits that the Multiple Fund Facts Document containing the Program Disclosure, which would be delivered to investors before their initial investment in Main Series securities of a Fund or, if eligible, securities of a Fee Tier Series of a Fund, provides investors with better disclosure than if investors received the Fund Facts pertaining only to the applicable Main Series or Fee Tier Series under the Automatic Switch Program.
40. In the absence of the Exemption Sought:
(a) NEI would be required to prepare separate Fund Facts for each of the Main Series and Fee Tier Series; and
(b) each Dealer would be required to deliver the applicable Fund Facts to investors in connection with the purchase of securities made pursuant to each Automatic Switch.
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:
1. the Multiple Fund Facts Relief is granted provided that each Multiple Fund Facts Document contains the Program Disclosure; and
2. the Fund Facts Delivery Relief is granted provided that:
(a) NEI, together with Dealers and their advisors, devise a notification plan regarding the Automatic Switches to existing investors in the Main Series to communicate the following:
(i) that their investment will be switched to a Fee Tier Series with lower combined management and administration fees than the Main Series upon meeting the applicable eligibility requirements;
(ii) that, other than a difference in fees, there will be no other material difference between the Main Series and the corresponding Fee Tier Series of the same Fund;
(iii) that if they cease to meet the eligibility requirements for a specific Fee Tier Series, their investment will be switched (i) to a Fee Tier Series with higher combined management and administration fees which will not exceed the combined management and administration fees of the corresponding Main Series, or (ii) the corresponding Main Series;
(iv) that they will not receive a Multiple Fund Facts Document when they purchase securities further to an Automatic Switch, but that:
(1) they may request the most recently filed Multiple Fund Facts Document for the relevant series by calling a specified toll-free telephone number or by sending a request via email to a specified address;
(2) the most recently filed Multiple Fund Facts Document will be sent or delivered to them at no cost, if requested;
(3) the most recently filed Multiple Fund Facts Document may be found either on the SEDAR website or on NEI's website; and
(4) they will not have the right to withdraw from an agreement of purchase and sale (a Withdrawal Right) in respect of a purchase of series securities made pursuant to an Automatic Switch, but they will have a right of action for damages or rescission in the event any Fund Facts or document incorporated by reference into a simplified prospectus for the relevant series contains a misrepresentation, whether or not they request the Fund Facts.
(b) NEI incorporates disclosure in the simplified prospectus of for each Fund participating in the Automatic Switch Program that describes the Automatic Switch Program, including setting out:
(i) the eligibility requirements for the applicable Main Series and Fee Tier Series;
(ii) the fees applicable to investments in the applicable Main Series and the Fee Tier Series; and
(iii) in the event investors (other than existing investors in Series P and Series PF prior to the Implementation Date) cease to meet the eligibility requirements of a specific Fee Tier Series, their investment will be switched (i) to a Fee Tier Series with higher combined management and administration fees which will not exceed the combined management and administration fees of the corresponding Main Series, or (ii) to the corresponding Main Series;
(c) for investors who purchase Main Series securities of a Fund or, if eligible, securities of Fee Tier Series of a Fund after the Implementation Date, the Multiple Fund Facts Document containing the Program Disclosure is delivered to investors before their first purchase of Main Series securities of a Fund or, if eligible, securities of Fee Tier Series of a Fund, in accordance with the Pre-Sale Fund Facts Delivery Requirement;
(d) for Main Series and Fee Tier Series investors (other than existing investors in Series P and Series PF prior to the Implementation Date), NEI sends these investors an annual reminder notice advising that they will not receive a Fund Facts when they purchase Fee Tier Series or Main Series securities, as the case may be, further to an Automatic Switch, but that:
(i) they may request the most recently filed Multiple Fund Facts Document by calling a specified toll-free telephone number or by sending a request via email to a specified address;
(ii) the most recently filed Multiple Fund Facts Document will be sent or delivered to them at no cost, if requested;
(iii) the most recently filed Multiple Fund Facts Document may be found either on the SEDAR website or on NEI's website; and
(iv) they will not have a Withdrawal Right in respect of a purchase of series securities made pursuant to an Automatic Switch, but they will have a right of action for damages or rescission in the event any Fund Facts or document incorporated by reference into a simplified prospectus for the relevant series contains a misrepresentation, whether or not they request the Fund Facts;
(e) NEI provides to the principal regulator, on an annual basis, beginning 60 days after the date upon which the Fund Facts Delivery Relief is first relied upon by a Dealer, either:
(i) a current list of all such Dealers that are relying on the Fund Facts Delivery Relief; or
(ii) an update to the list of such Dealers or confirmation that there has been no change to such list; and
(f) prior to a Dealer relying on the Fund Facts Delivery Relief, NEI provides to the Dealer a disclosure statement informing the Dealer of the implications of this decision.