Ontario Securities Commission Bulletin

Issue 35/03 - January 20, 2012

Ont. Sec. Bull. Issue 35/03

Table of Contents

Chapter 1 - Notices / News Releases

Notices

• Current Proceedings before the Ontario Securities Commission

• OSC Staff Notice 15-705 -- Notice of Extension of Time for Public Comment on Proposed Enforcement Initiatives and Continuation of Public Consultation through a Policy Hearing

• CSA Staff Notice 51-327 (Revised) -- Guidance on Oil and Gas Disclosure (First published February 27, 2009, revised December 30, 2010 and December 29, 2011)

• Roundtable Consultation Session on CSA's Review of Minimum Amount and Accredited Investor Prospectus Exemptions

Notices of Hearing

• Sino-Forest Corporation et al. -- ss. 127(7), 127(8)

• Ground Wealth Inc. et al. -- ss. 127(7), 127(8)

• Global Energy Group, Ltd. et al. -- ss. 37, 127

• Irwin Boock et al. -- ss. 127(1), 127.1

Notices from the Office of the Secretary

• Global Consulting and Financial Services et al.

• Portus Alternative Asset Management Inc. et al.

• Sino-Forest Corporation et al.

• Ground Wealth Inc. et al.

• David M. O'Brien

• Peter Beck et al.

• Global Energy Group, Ltd. et al.

• Irwin Boock et al.

Chapter 2 - Decisions, Orders and Rulings

Decisions

• Acker Finley Canada Focus Fund -- s. 1(10)

• Gluskin Sheff + Associates Inc.

• Sun Life Assurance Company of Canada and Sun Life Capital Trust

• Lions Bay Capital Inc.

• Geo Minerals Ltd. -- s. 1(10)

• Clifton Group Investment Management Company

• Manulife Asset Management Limited et al.

• AlphaNorth 2010 Flow-Through Limited Partnership et al.

Orders

• Global Consulting and Financial Services et al. -- ss. 127(1), 127(8)

• Portus Alternative Asset Management Inc. et al. -- ss. 127, 127.1

• David M. O'Brien

• Tulloch Resources Ltd. (formerly Elkhorn Gold Mining Corporation) -- s. 144

• Peter Beck et al. -- s. 127

Chapter 3 - Reasons: Decisions, Orders and Rulings

OSC Decisions, Orders and Rulings

• Blueport Capital Corp. and John Hare -- s. 31

Chapter 4 - Cease Trading Orders

• Temporary, Permanent & Rescinding Issuer Cease Trading Orders

• Temporary, Permanent & Rescinding Management Cease Trading Orders

• Outstanding Management & Insider Cease Trading Orders

Chapter 8 - Notice of Exempt Financings

• Reports of Trades Submitted on Forms 45-106F1 and 45-501F1

Chapter 11 - IPOs, New Issues and Secondary Financings

Chapter 12 - Registrations

• Registrants

Chapter 13 - SROs, Marketplaces and Clearing Agencies

SROs

• IIROC Rules Notice -- Request for Comment -- Amendments to Schedule 12 of Form 1 and the Notes and Instructions to Schedule 12 of Form 1

Marketplaces

• TSX Inc. -- Notice of Commission Approval -- Amendments to the Rules of the Toronto Stock Exchange Related to Market Making

Clearing Agencies

• CDS -- Notice of Effective Date -- Technical Amendments to CDS Procedures -- Dividend with Option Enhancements, Proration Indicator, and Automated Withdrawals for Paying Agents

• Notice of Effective Date -- Technical Amendments to CDS Procedures -- Alert For Late or Non-Receipt of New York Link Collateral Requirement File

Chapter 25 - Other Information

Exemptions

• Investors Group Unit Trust Funds -- Part 6 of NI 81-101 Mutual Fund Prospectus Disclosure

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Chapter 1 -- Notices / News Releases

Current Proceedings before the Ontario Securities Commission

January 20, 2012

CURRENT PROCEEDINGS

BEFORE

ONTARIO SECURITIES COMMISSION

Unless otherwise indicated in the date column, all hearings will take place at the following location:

The Harry S. Bray Hearing Room

Ontario Securities Commission

Cadillac Fairview Tower

Suite 1700, Box 55

20 Queen Street West

Toronto, Ontario

M5H 3S8

Late Mail depository on the 19^th Floor until 6:00 p.m.

THE COMMISSIONERS

SCHEDULED OSC HEARINGS

ADJOURNED SINE DIE

Global Privacy Management Trust and Robert Cranston

Livent Inc., Garth H. Drabinsky, Myron I. Gottlieb, Gordon Eckstein, Robert Topol

LandBankers International MX, S.A. De C.V.; Sierra Madre Holdings MX, S.A. De C.V.; L&B LandBanking Trust S.A. De C.V.; Brian J. Wolf Zacarias; Roger Fernando Ayuso Loyo, Alan Hemingway, Kelly Friesen, Sonja A. McAdam, Ed Moore, Kim Moore, Jason Rogers and Dave Urrutia

Hollinger Inc., Conrad M. Black, F. David Radler, John A. Boultbee and Peter Y. Atkinson

OSC Staff Notice 15-705 -- Notice of Extension of Time for Public Comment on Proposed Enforcement Initiatives and Continuation of Public Consultation through a Policy Hearing

OSC STAFF NOTICE 15-705 -- NOTICE OF EXTENSION OF TIME

FOR PUBLIC COMMENT ON PROPOSED ENFORCEMENT INITIATIVES

AND CONTINUATION OF PUBLIC CONSULTATION THROUGH A POLICY HEARING

On October 24, 2011, staff of the Ontario Securities Commission (the "OSC" or "Commission") published OSC Staff Notice 15-704 Request for Comments on Proposed Enforcement Initiatives (the "Request for Comments"). Due to the level of public interest in the proposed initiatives, the deadline for submitting written comments is extended to January 16, 2012 and a policy hearing will be held by the Commission to seek additional input on the proposed initiatives, particularly the proposed No-Contest Settlement proposal.

The Proposed Enforcement Initiatives

The Request for Comments outlined new enforcement initiatives under examination by staff aimed at resolving enforcement matters more quickly and effectively. The initiatives are intended to contribute to a higher volume of protective orders made in the public interest, at the earliest opportunity, for the benefit of investors and the capital markets. They are summarized as follows:

1 New program for explicit Non-Enforcement Action Agreement, under which a party would explicitly not be subject to OSC enforcement action in exchange for self-reporting matters that may involve breaches of Ontario securities law or activities that would be considered contrary to the public interest, and for cooperating in an investigation.

2 New No-Contest Settlement program, under which a protective order could be made in the absence of a specific admission by the respondent of a breach of the Securities Act (Ontario).

3 Clarified process for self-reporting under the OSC's credit for cooperation program, to ensure that all parties are informed on how best to self-report and come forward with information.

4 Enhanced public disclosure of credit granted for cooperation, to provide greater certainty of potential outcome for all parties that may consider self-reporting.

Extension of Comment Period

The public comment period to provide feedback on these initiatives was originally scheduled to expire on December 20, 2011. In order to provide interested members of the public with a further opportunity to submit written comments, the public comment period has been extended to January 16, 2012.

All comments should be submitted to the attention of the Office of the Secretary at the OSC. As indicated in the original Notice, submissions are not confidential. Comments will be posted on the Commission website at www.osc.gov.on.ca.

Policy Hearing

As indicated above, the Commission will hold an in-person policy hearing to continue public consultation with respect to the proposed initiatives. Based on the comments received to date, it is anticipated that the policy hearing will focus on the proposed No-Contest Settlement proposal. While the policy hearing will be open to the public to attend, the format and participants will be determined in light of the comments received and the nature of the issues that could most benefit from further consultation. Further particulars respecting the policy hearing, including time and location, will be announced in early 2012.

For more information:

December 20, 2011

CSA Staff Notice 51-327 (Revised) -- Guidance on Oil and Gas Disclosure (First published February 27, 2009, revised December 30, 2010 and December 29, 2011)

REVISED CSA STAFF NOTICE 51-327

GUIDANCE ON OIL AND GAS DISCLOSURE

First published February 27, 2009, revised December 30, 2010 and December 29, 2011

December 29, 2011

1. Introduction

This revised Canadian Securities Administrators (CSA) Staff Notice (Notice) provides guidance on compliance with aspects of National Instrument 51-101 Standards of Disclosure for Oil and Gas Activities (NI 51-101).

NI 51-101 applies to reporting issuers that are directly or indirectly engaged in oil and gas activities (Oil and Gas Issuers). Central to the NI 51-101 disclosure regime is mandatory disclosure of prescribed reserves data, which includes estimates of proved reserves and probable reserves and related future net revenue. NI 51-101 also establishes standards for certain non-mandatory disclosure that Oil and Gas Issuers may choose to make regarding oil and gas activities.{1}

When first issued on 27 February 2009 under the title Oil and Gas Disclosure: Resources Other Than Reserves Data, this Notice was designed to address observations by CSA staff of issues arising as a result of an increase in non-mandatory disclosure of possible reserves and other resource classes, especially for unconventional resources. This Notice was revised as of 30 December 2010 to address additional issues relating to oil and gas disclosure and to remove guidance on certain issues that we addressed by amendments to NI 51-101.{2} This Notice is now further updated (the 2011 Revisions) to discuss observations by CSA Staff in reviewing disclosure in light of recent amendments to NI 51-101 and to re-emphasize or expand guidance on some issues discussed in previous versions of this Notice.

As indicated by the new title, the 2011 Revisions broaden the scope of this Notice. The 2011 Revisions include the following:

• new guidance on the general responsibilities of Oil and Gas Issuers and the experts on whom they rely in formulating disclosure of oil and gas information

• new guidance on the following disclosure topics:

• disclosure of after-tax net present value of future net revenue

• use of BOEs

• disclosure of well-flow test results

• expanded guidance on the following disclosure topics:

• evaluation, classification and disclosure of unconventional hydrocarbons, including revised guidance on disclosure of contingent resources

• classification to the most specific class and category of resource

• guidance carried forward from the original version of this Notice with little or no change on the following disclosure topics:

• stand-alone possible reserves

• aggregation of resource estimates for several properties

• use of the term "best estimate"

• prospective resources

Context and Cautions

• Suggested Wording -- We recommend, at various points in this Notice, that non-mandatory disclosure be accompanied by cautionary statements, and we suggest wording that may be helpful. We recommend cautionary statements based on our view that disclosure of resources other than proved and probable reserves may mislead if the disclosure lacks context; we intend the cautionary statements to provide appropriate context. Adequate disclosure will provide explanation and, where appropriate, cautionary information. An Oil and Gas Issuer may use cautionary wording other than what we recommend by this Notice where necessary to provide complete and accurate disclosure.

• General Guidance with Examples -- We have chosen specific disclosure topics for discussion in this Notice as examples of how general principles apply to specific situations, the topics chosen reflecting recurring concerns arising from observations of CSA Staff in reviewing disclosure. This Notice is not a checklist -- we intend that Oil and Gas Issuers, and their evaluators and auditors, will use this Notice to guide them in preparing oil and gas disclosure. The themes illustrated in that discussion -- of professional responsibility and careful choices in formulating disclosure -- apply also to other topics not mentioned here.

Notes on Terminology

• Terminology References -- Clarity and consistency in the use of terminology is essential to good disclosure by Oil and Gas Issuers. Important terminological sources include:

• COGE Handbook -- refer to section 5 of Volume 1{3} of the Canadian Oil and Gas Evaluation Handbook (the COGE Handbook), titled "Definitions of Resources and Reserves", notably Figure 5-1; and

• CSA Staff Notice 51-324 Glossary to NI 51-101 Standards of Disclosure for Oil and Gas Activities (the CSA Glossary).

• Specific Terms -- Classification and categorization of resources is an important aspect of disclosure under NI 51-101. Although there is now broad alignment between the COGE Handbook and the Society for Petroleum Engineers -- Petroleum Resource Management System (SPE-PRMS), some differences remain.{4} For clarity, this Notice adopts terminology as follows:

• "Class" -- we refer to "class" in the same manner as used by the SPE- PRMS to describe the chance of commerciality (reserves, contingent resources, etc.).

• "Category" -- we refer to "category" in the same manner as used by the SPE-PRMS to describe the range of uncertainty within a class. (Thus, for example, within the class of "reserves" are the categories of "proved", "probable" and "possible", and for other classes the estimation categories of "low case", "best case" and "high case".)

• "Resources" -- in colloquial usage, the term "resources" may or may not include reserves volumes. We refer to "resources", consistent with the CSA Glossary, as a general term that may refer to all or a portion of total resources, with "total resources" as equivalent to "total petroleum initially-in-place" as defined in the COGE Handbook.

• "Reserves data" -- we refer to "reserves data" as defined in NI 51-101 as an estimate of proved reserves and probable reserves and related future net revenue. The phrase "resources other than proved or probable reserves" refers to all other classes of resources as classified in the COGE Handbook, including possible reserves.

2. Responsibility for Disclosure of Oil and Gas Information

All who are involved in Oil and Gas Issuers' disclosure -- the issuers themselves, their management and directors, and those individuals or firms who provide professional services to them -- should be mindful of both (i) the fundamental objectives of Canadian securities legislation, and (ii) the various sources of requirements, restrictions and standards that may apply to formulating disclosure. To protect investors and foster fair and efficient capital markets, Canadian securities legislation is designed to provide the investing public with timely, useful and reliable information from reporting issuers. Those involved in providing such information should give thought to those key objectives. Such individuals must also take note of applicable rules and requirements of relevant professional associations and applicable requirements and restrictions of Canadian securities legislation, which include but are not entirely limited to NI 51-101, which mandates compliance with the COGE Handbook.

(a) Oil and Gas Issuers -- General Standards and Responsibilities

Disclosure relating to oil and gas activities of an Oil and Gas Issuer is subject to the specific requirements and restrictions of NI 51-101, but disclosure requirements are not limited to NI 51-101. Oil and Gas Issuers must make their disclosure within the larger context of Canadian securities legislation and appropriate use of instructional guides in developing and reporting disclosure.

(i) Canadian Securities Legislation, Generally

Disclosure relating to oil and gas activities is subject not only to the specific requirements and restrictions of NI 51-101 but also to applicable requirements and prohibitions of other elements of Canadian securities legislation. Not every topic of disclosure is discussed specifically in NI 51-101 or elsewhere in Canadian securities legislation. Oil and Gas Issuers must also give attention to the broader purposes, principles and prohibitions of Canadian securities legislation. Following are discussions of a few examples.

A. Misrepresentations or Misleading Statements

Among the broad prohibitions of Canadian securities legislation is the ban on misrepresentations -- that is (broadly speaking), false, untrue or misleading statements (or omissions from statements) of facts that are material in the sense of being reasonably likely to significantly affect the market price or value of a security. Such materially misleading disclosure is improper and illegal. All responsible for an Oil and Gas Issuer's disclosure should, therefore, give close attention to its quality, ensuring that it does not -- expressly, or by omission -- mislead. In assessing the quality and sufficiency of disclosure or proposed disclosure, they should bear in mind not only specific disclosure requirements (if applicable) but also, more broadly, the key purposes of Canadian securities legislation, mentioned above.

The following are examples of disclosure that, in the view of CSA staff, could be materially misleading or untrue:

• disclosure of a contingent resource for which there is no flow test or good analog;

• the results of an evaluation for a reservoir based on a production process that has never been used in that type of reservoir;

• inappropriate analog -- that is, use of information that is not truly analogous to the reported reserves; and

• disclosure of unconventional resources using a project scenario that is not reasonable with regard to timing or cost and may result in misleading disclosure with respect to the value of a project.{5}

Similarly, the following are examples of disclosure that CSA staff consider could be materially misleading or untrue by reason of omissions -- failures to state facts that may be required or necessary to be stated to avoid what is stated being misleading:

• disclosure of petroleum initially-in-place (PIIP) without clarifying whether it is discovered or undiscovered;

• disclosure of a contingent resource without providing information as to its economic viability;

• disclosure of a resource of any class or category without adequate disclosure of the associated significant economic factors or significant uncertainties that are specific to the Oil and Gas Issuer that may affect any associated project;

• disclosure of a contingent resource with only general or vague mention of the contingencies -- for example, using wording commonly used by other Oil and Gas Issuers that may not fully or accurately describe the contingencies that apply in the particular circumstances; and

• disclosure of a short-term peak rate for a well test without providing additional disclosure on the test, including that the reported rate is a short-term peak rate.

B. Material Changes

As one example of a specific disclosure requirement arising outside NI 51-101, Canadian securities legislation requires prompt public disclosure of any "material change".{6} A reporting issuer satisfies this important disclosure obligation by issuing and filing a news release and filing a material change report; it is not satisfied merely by including information in an Oil and Gas Issuer's annual statement of reserves data filed under NI 51-101 or issuing a news release alone.

C. Requirements Applicable to Disclosure of Oil and Gas Activities

NI 51-101 imposes standards and restrictions that apply to disclosure of oil and gas activities, whether or not such disclosure is restricted to proved and probable reserves and related future net revenue. That is, an Oil and Gas Issuer must consider whether disclosure of oil and gas activities, in any form, and whether made voluntarily or in response to any specific provision of NI 51-101, adheres to applicable provisions of Part 5 of NI 51-101.

It is not possible to identify in advance for all issuers all potentially sound -- or improper -- disclosure. Oil and Gas Issuers and those involved in preparing, authorizing and disseminating their disclosure must assess their particular facts and circumstances and make judgements on such matters as materiality, taking into account express legal requirements and restrictions, as well as broader principles and prohibitions. That said, CSA staff believe that the observations and recommendations in this Notice will assist Oil and Gas Issuers and those involved in preparing, authorizing and disseminating their disclosure.

(ii) COGE Handbook and Other Guides

The COGE Handbook is a useful reference resource for preparing and issuing disclosure required by Canadian securities legislation. It is not, however, an exhaustive guide. Oil and Gas Issuers should bear in mind relevant general principles when formulating disclosure.

As an example, the COGE Handbook currently provides only limited guidance in respect of the evaluation of resources other than reserves, especially for unconventional resources. When using the COGE Handbook in the preparation and review of information for securities disclosure, Oil and Gas Issuers must interpret it in a manner that is consistent with all applicable Canadian securities legislation including, but not limited to, the principles and specific requirements and restrictions of NI 51-101.

(iii) Specific Description Rather than Commonly-used Wording

To avoid misleading disclosure, Oil and Gas Issuers should tailor their disclosure to their particular circumstances. We have observed the use, verbatim, of wording that appears in other issuers' disclosure. Boilerplate disclosure is unhelpful for an investor reader; it may also be misleading.

As an example, the long standing requirement found in item 5.2 of Form 51-101F1 Statement of Reserves Data and Other Oil and Gas Information (Form 51-101F1) that requires an Oil and Gas Issuer to discuss company-applicable significant factors or uncertainties with respect to reserves data has been extended to other resource categories. Section 5.9 of NI 51-101 and item 6.2.1 of Form 51-101F1 detail these requirements. In order to comply with NI 51-101, the disclosure should clearly address the factors and uncertainties that are specific to the Oil and Gas Issuer's properties and not simply repeat boilerplate discussion or repeat other Oil and Gas Issuers' disclosure.

(iv) Use of NI 51-101 Forms for Other Purposes

Forms 51-101F1, 51-101F2 Report on Reserves Data by Independent Qualified Reserves Evaluator or Auditor (Form 51-101F2) and 51-101F3 Report of Management and Directors on Oil and Gas Disclosure (Form 51-101F3) are intended to be used for annual disclosure of reserves data and other specific information. An Oil and Gas Issuer may use such forms as templates for other disclosure purposes, but those documents that offer additional disclosure should not be identified as "Form 51-101F1", "Form 51-101F2" or "Form 51-101F3", and the headings should be modified to describe the actual contents of the disclosure.

The disclosure prescribed by Forms 51-101F1 and 51-101F3 is required for all annual filings under NI 51-101. A report in Form 51-101F2 is required only if the Oil and Gas Issuer is disclosing reserves data (i.e., proved and/or probable reserves) and is not required if the annual filing includes only resources other than reserves. If an Oil and Gas Issuer wishes to do so, a report similar to that prescribed by Form 51-101F2 may be filed reporting resources other than reserves, but should not be identified as "Form 51-101F2" and the heading should be suitably modified.

(b) Evaluators and Auditors -- General Standards and Responsibilities

An independent qualified reserves evaluator or auditor who signs a report in Form 51-101F2 is representing that the disclosed information is not misleading and that the reserves data are free of material misstatement. Therefore, by signing those forms, qualified reserves evaluators and auditors are taking on a professional responsibility that reflects on their individual professionalism and the integrity of their profession. This section provides guidance using, as an example, representations about the net present value of future net revenue of an Oil and Gas Issuer's estimated proved and probable reserves.

(i) Professional Responsibility

One of the requirements of NI 51-101 is that a qualified reserves evaluator or auditor must be a member of a professional organisation as defined in paragraph 1.1(w) of NI 51-101.{7}

Oil and Gas Issuers and evaluators must be aware of section 4.8 of Volume 1 of the COGE Handbook, titled "Independence, Objectivity and Confidentiality". It may, for instance, be inappropriate for an evaluator to provide an evaluation of a project on which the evaluator has also provided significant engineering advice.

(ii) Misrepresentations or Misleading Statements

The guidance regarding misrepresentations or misleading statements discussed above{8} applies equally to a qualified reserves evaluator or auditor who signs a statement in Form 51-102F2. In particular, professionals must represent that evaluated projects of the Oil and Gas Issuer provide a net present value of future net revenue that is not misleading.

The evaluation of oil and gas resources is based on a defined scenario or project.{9} Many unconventional resources are developed through large projects, often with long timelines and a net present value that captures the time-discounted value of expenditure and revenue. A project scenario that is not reasonable with regard to timing or cost could result in misleading disclosure with respect to the value of a project.

An evaluation scenario, whether provided to the evaluator for review by the Oil and Gas Issuer or developed by the evaluator, should be reasonable with regard to timing and cost. Oil and Gas Issuers may consider providing a description of key factors in a major project scenario in order to avoid misleading disclosure.

(iii) Use of COGE Handbook and Other Guides

The guidance provided above in subparagraph 2(a)(ii) of this Notice similarly applies to activities of qualified reserves evaluators and auditors in reviewing Oil and Gas Issuers' disclosure. Technical manuals and reference materials are valuable tools, and in some cases required, to aid in developing disclosure. They should be used appropriately in the exercise of fulfilling the general, as well as specific, obligations of Canadian securities legislation.

(iv) Expertise Required to Perform Evaluation

When evaluators or auditors sign a report in Form 51-101F2 they are representing that they possess the expertise to carry out the evaluation that is being reported. NI 51-101 requires that such professionals possess the professional qualifications and experience appropriate to carry out the required review.{10} In addition to the NI 51-101 requirements that evaluators and auditors be qualified professionals, obligations and standards of their profession will apply.{11}

As an example, where an evaluator assigns a net present value or confirms a net present value that has been assigned on the basis of such things as a novel recovery technology or upgrading, the evaluator must be certain as a professional that they possess adequate qualifications and experience to make that professional judgement.

(v) Consent to Disclose Information from Report

Section 4.4 of Volume 1 of the COGE Handbook recommends the preparation of an engagement letter that specifies a "project description confirming the scope and objective of the [evaluation] project". An evaluation report is typically prepared for a particular purpose. A good practice would be for an Oil and Gas Issuer to seek the consent of the evaluator for disclosure of information from a report for a purpose other than which it was prepared, or for selective disclosure from any report. A requirement for the evaluator's consent to disclose part or all of an evaluation is often part of this engagement letter.

An evaluator who consents to disclosure of information from a report that he has prepared should be aware of the potential for civil liability (see, for example, secondary-market disclosure liability provisions of provincial and territorial securities legislation), request confirmation from the Oil and Gas Issuer of the purpose for which an evaluation is being prepared and ensure the report is appropriate for the intended disclosure purpose. Following are some examples where qualified evaluators and auditors should be cautious:

• disclosure of the results of an evaluation of a project that does not allow time for regulatory approval or the successful execution of which is clearly beyond the ability of the Oil and Gas Issuer to carry out, and consequently presents a misleading estimate of the net present value of the project; or

• an evaluation predicated on the availability of technology that is not fully developed for the specific reservoir being evaluated, unless accompanied by appropriate cautionary statements.

3. Specific Disclosure Topics

The 2011 Revisions provide guidance to Oil and Gas Issuers and those involved in preparing, authorizing and disseminating their disclosure about general requirements and responsibilities under Canadian securities legislation, professional ethics and other obligations applicable to the formulation of oil and gas disclosure. In expanding this Notice, we have carried forward guidance relating to specific disclosure topics from previous versions of this Notice and, in some cases, have expanded or added new guidance based on experience in reviewing oil and gas disclosure. The following discussion topics should not be viewed or treated as an exhaustive list of potential issues related to oil and gas disclosure. The following serve as examples that incorporate some of the general concepts discussed in section 2 above.

(a) Disclosure of After-Tax Net Present Values of Future Net Revenue (After-Tax NPV)

NI 51-101 (i.e. Form 51-101F1) requires Oil and Gas Issuers to disclose estimates of After-Tax NPV of proved and probable reserves in the annual statement. Oil and Gas Issuers may also disclose volumes and estimates of After-Tax NPV of other resources. A reporting issuer may also choose to disclose its reserves or other information of a type that is specified in Form 51-101F1, which may include estimates of future net revenue attributable to reserves, whether for the issuer in the aggregate or for a portion of its activities. This type of disclosure would be in addition to the annual filing disclosure and included in a separate document, such as a news release. Section 5.2 of NI 51-101 specifies that all such disclosure must satisfy certain requirements including subparagraph 5.2(a)(iii) and paragraph 5.2(c) of NI 51-101.

Estimates of After-Tax NPV are dependent on a number of factors including, but not limited to, one or more of the following:

• forecast future capital expenditure required to achieve the forecast production;

• interaction with, or deductibility of, government royalties or other proportionate sharing rights;

• inclusion of existing tax pool balances of the issuer (inclusion is prescribed for issuer-aggregate estimates according to section 7 of Volume 1 of COGE Handbook);

• tax pool write-off rates;

• sequence in which tax pools are utilized;

• applicability of special tax incentives; and

• forecast production revenue and expenses.

Each of these can have a significant impact on the outcome, which could mislead investors if not properly considered in the evaluation or if the Oil and Gas Issuer's disclosure does not provide sufficient accompanying information to enable a reader to make an informed decision.

The fundamental objective of disclosure is to provide information to an investor that can be used to make investment decisions. To assist investors, Oil and Gas Issuers may footnote the disclosure of an After-Tax NPV with information appropriate to their circumstances. If an Oil and Gas Issuer makes this disclosure, it should generally include, as appropriate, one or more of the following:

• a general explanation of the method and assumptions used in an Oil and Gas Issuer's calculation, worded to reflect its specific circumstance and the approach taken. This need not be detailed, but major aspects should be addressed, such as whether tax pools have been included in the evaluation;

• an explanatory statement to the following effect:

The after-tax net present value of [the business entity]'s oil and gas properties here reflects the tax burden on the properties on a stand-alone basis. It does not consider the business-entity-level tax situation, or tax planning. It does not provide an estimate of the value at the level of the business entity, which may be significantly different. The financial statements and the management's discussion & analysis (MD&A) of [the business entity] should be consulted for information at the level of the business entity.

(b) Use of Barrels of Oil Equivalent (BOEs)

Section 5.14 of NI 51-101 describes the disclosure requirements for the use of BOEs. It requires the conversion to be carried out using a ratio 6 Mcf of Gas to 1 Bbl of Oil (6:1). A cautionary statement is also required to the following effect:

BOEs [or 'McfGEs' or other applicable units of equivalency] may be misleading, particularly if used in isolation. A BOE conversion ratio of 6 Mcf: 1 Bbl [or "An McfGE conversion ratio of 1 Bbl: 6 Mcf"] is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead.

When the value ratio is significantly different from the energy equivalency of 6:1, Oil and Gas Issuers may be required to provide additional disclosure in order to avoid being misleading. For example, a value ratio of 20:1 at the time the disclosure is made would require an explicit statement to the effect that a conversion using a 6:1 ratio would be misleading as an indication of value.

The results of using conversion ratios other than 6:1 may be disclosed, provided an explanation is given.

(c) Disclosure of Well-Flow Test Results

Disclosure of well-flow test results can have a significant effect on the market price or value of an Oil and Gas Issuer. Additional information is often necessary in order to avoid misleading readers with such disclosure.{12} Disclosing the results of short-term tests, "rates up to", or short-term peak rates as daily rates, for example, would be misleading without additional explanation.

Oil and Gas Issuers should include information about all of the following when disclosing well-flow test results:

• the geological formation for which test results are being disclosed;

• the type of test (examples include wireline, drillstem testing (DST), or production test);

• duration of the test;

• average rate of oil- or gas-flow during the test;

• recovered fluid types and volumes (reporting the recovery of load fluid without stating that it is load fluid would be regarded as misleading);

• significant production or pressure decline during the test;

• if a pressure transient analysis or well-test interpretation has not been carried out, a cautionary statement should be made to the effect that the data should be considered to be preliminary until such analysis or interpretation has been done; and

• a cautionary statement that the test result is not necessarily indicative of long-term performance or of ultimate recovery.

In addition to the disclosure of the above information on a well-flow test, further disclosure may be necessary to avoid being misleading to readers, especially when high initial decline rates or a short production life are anticipated. Such additional disclosure could include expected duration of production.

Canadian securities legislation requires an Oil and Gas Issuer to make timely disclosure -- notably when the result of a test and its implications could amount to a material change.

(d) Evaluation, Classification and Disclosure of Unconventional Hydrocarbons

(i) Introduction

The COGE Handbook guidance for the classification of a hydrocarbon volume as discovered PIIP mainly addresses conventional hydrocarbons that exhibit primary flow. In this section, we provide additional guidance primarily for disclosure of unconventional hydrocarbons. Technology developed for unconventional resources is increasingly being applied by Oil and Gas Issuers to poor-quality conventional reservoirs; this additional guidance applies to these reservoirs.

(ii) Known Accumulation Criterion

One of the criteria for classification of a volume of hydrocarbons as discovered PIIP is that the volume is in a "known accumulation", which Appendix A of Volume 1 of the COGE Handbook defines as follows:

An accumulation that has been penetrated by a well. In general the well must have demonstrated the existence of hydrocarbons by flow testing in order for the accumulation to be classified as 'known'. However, where log and/or core data exist, and there is good analogy to a nearby and geologically comparable known accumulation, this may suffice.

Penetration by a well -- This is a prerequisite for classification as discovered PIIP, and of any of the sub-classes of discovered PIIP. Extrapolation from an existing well on the basis of analogy is discussed below.

Demonstration of the existence of hydrocarbons by flow testing -- This may be problematic because many unconventional hydrocarbons cannot be tested by primary flow and can require extensive stimulation and pilot testing before flow may be demonstrated. When this is the case, it may be possible to use log and core data and analogs to satisfy the known accumulation criterion.

Log and Core Data -- Unconventional hydrocarbon accumulations often have log and core data available from many, sometimes hundreds, of stratigraphic test wells before flow has been demonstrated by pilot testing. On its own, such data may demonstrate the presence of hydrocarbons; but, in the absence of flow information, such data would not satisfy the known accumulation criterion. Laboratory tests of cores that provide convincing evidence of the presence of significant (not trace or minimal) moveable oil would generally be sufficient to satisfy the known accumulation criterion and to assign discovered PIIP to an area around a well from which the core had been taken. In the absence of further evidence, an Oil and Gas Issuer must classify such a volume as unrecoverable and not as contingent resources or reserves.

Analogous Information -- An Oil and Gas Issuer may satisfy the known accumulation criterion by a "good analogy to a nearby and geologically comparable known accumulation". Because in this case the analogy is a replacement for a flow test, it is not sufficient for individual reservoir parameters such as porosity or saturation to be comparable, but all aspects of the analog in combination should support the expectation that the target reservoir will be able to flow in a similar manner, using the same recovery process. We discuss this in more detail below.

Flow from temporary stimulation -- The criterion for flow testing for classification as discovered PIIP may be satisfied by a stimulation process, which results in temporary flow (e.g., stimulation by hot water or cold solvent). In the absence of further evidence, an Oil and Gas Issuer must classify such a volume as unrecoverable and not as contingent resources or reserves.

We think that events that would not usually be considered to provide adequate evidence of flow for classification as discovered PIIP include desorption from cores, gas kicks, gas or oil cutting of the mud or minimal recovery (e.g., oil film) on tests.

(iii) Use of Analogous Information

There is limited guidance on what constitutes a "good analogy", or what "geologically comparable" or "nearby" mean, and the demonstration of an ability to flow by "a good analogy to a nearby and geologically comparable known accumulation" seems to be interpreted more generously for unconventional resources than for conventional resources. The use of analogs for assigning reserves is discussed in section 6.2 of Volume 2 of the COGE Handbook, which is generally applicable to resources other than reserves. Papers by Hodgin and Harrell{13} and Sidle and Lee{14} describe the use of analogs for assigning reserves for oil and gas filings with the U.S. Securities and Exchange Commission (SEC). Although the details of the approach described in these two papers would not necessarily meet specific requirements for regulatory disclosure, they provide a useful discussion on good practices on the use of analogous information.

We think that, in order for this disclosure not to be misleading to readers, analog information that supports classification as a contingent resource (or as a reserve) must demonstrate all of the following:

• the presence of a geological unit with comparable geological properties;

• the presence of hydrocarbons;

• that the hydrocarbons are potentially producible.

Further assessment may be required by an Oil and Gas Issuer in order to determine if a contingent resource using analog information is economic or sub-economic.

The criterion that the analogy is "nearby" may be of general relevance as an indicator that the analog reservoir has been deposited in the same depositional environment and subject to the same diagenetic and structural processes as the subject reservoir. However, the Oil and Gas Issuer may question the applicability of the criterion, as geological processes can vary over very short distances and geographic proximity is often not a reliable indicator of the validity of an analogy.

When evaluating unconventional resources, the following requires careful consideration:

• Limited analogous information -- In comparison to the amount and quality of analogous information on conventional oil and gas, the analogous information available on unconventional resources is extremely limited. For example, few steam assisted gravity drainage (SAGD) well pairs have produced for a significant period of time.

• Relevance of analogous information -- Initial activity in any development tends to be in the best quality reservoir and its use as an analog for later activity can present an overly optimistic picture.

• Analogs provide a best estimate -- Analogs provide information on proved + probable reserves or best case estimate outcomes for resource classes other than reserves. Oil and Gas Issuers should adjust estimates of proved reserves or low case estimates accordingly.

• Simulation -- Simulation can provide an important insight into reservoir performance, but only if the Oil and Gas Issuer can demonstrate that it is an appropriate analog in the construction of the simulation model.

In order to avoid misleading disclosure, an Oil and Gas Issuer may be required to provide more information on the technical analysis that supports the use of a particular analog as being "a good analogy to a nearby and geologically comparable known accumulation" and its relevance to supporting the expectation of flow in a subject reservoir, when failure to disclose this information may be misleading. Additional information could include details of one or more of the following:

• the specific reservoir analog or analogs with relevant information, including properties of the analog and the subject reservoir; and

• the specific process analogy, which is of particular importance when an Enhanced Oil Recovery (EOR) technique (e.g., thermal stimulation, SAGD or fracturing) is required to recover the hydrocarbon.

The strength of an analog should be one of the factors in determining the categories (high, best and low estimates) within a contingent resource.

(iv) Extrapolation from Existing Data

We are concerned about the distance to which the information on a data point, such as a well, can be reasonably extrapolated. In the evaluation of contingent resources, we have seen a tendency for the reservoir in any new accumulation, conventional or unconventional, to be considered to be homogeneous over a very large area, with extrapolation from limited data over this large area. This tends to be more extreme for unconventional accumulations for which the presence of a geological unit, but not necessarily its productivity, may be extrapolated much further than would be considered reasonable for conventional accumulations. We have seen extreme examples of extrapolation, in particular for shale gas, where little is generally known about the reservoir complexities that control productivity.

For an extrapolation to be valid, it must be possible to demonstrate, over the area of extrapolation, with the level of certainty appropriate for the estimate (low, best, and high) all of the following:

• the presence of the geological unit of interest;

• that it contains hydrocarbons;

• that the reservoir properties over the area of extrapolation are analogous to those at the data point from which the extrapolation is being made and that these hydrocarbons are, therefore:

• moveable, for classification as discovered PIIP; and

• potentially recoverable, for classification as a contingent resource.

In our review of Oil and Gas Issuers' filings, we see insufficient weight often being placed on these criteria, especially the third one, by making lengthy extrapolations from a tested well based on a default assumption of homogeneity throughout the formation. There is overwhelming evidence that the geological formations from which hydrocarbons are produced are almost invariably heterogeneous, and the default assumption should be that a reservoir is not homogenous. Extrapolation from beyond the immediate vicinity of a data point should be limited unless there is clear evidence to show otherwise.

A specific example is the assignment of proved undeveloped (PUD) reserves offsetting a horizontal well. The extent to which this type of assignment is done is a function of the information that is available to support this assignment, in particular the understanding of the reservoir properties. We expect there to be substantial technical support for the assignment of more than one PUD location on either side, or beyond the toe or heel, of an existing horizontal well.

(v) Project Maturity

Oil and Gas Issuers evaluate recoverable resources (reserves, contingent and prospective resources) based on a development plan that may consist of one or more projects{15} at different levels of maturity. The COGE Handbook refers to section 2.1.3.1 of the SPE-PRMS for a classification of these levels of maturity.{16}

Oil and Gas Issuers disclosing resources other than reserves are required to discuss "the significant positive and negative factors relevant to the estimate"{17}. As part of this discussion, Oil and Gas Issuers may wish to use this classification as an aid to satisfying the disclosure requirement. Additional description of a project may also be necessary to provide satisfactory disclosure.

(vi) Contingencies

Subparagraph 5.9(2)(d)(iv) of NI 51-101 requires Oil and Gas Issuers disclosing contingent resources to provide information on the "specific contingencies which prevent the classification of the resources as reserves." Based on our review of Oil and Gas Issuers' filings, this disclosure is often poor. Oil and Gas Issuers should note the following definition of "contingent resources", in section 5.2 of Volume 1 of the COGE Handbook:

Contingent Resources are those quantities of petroleum estimated, as of a given date, to be potentially recoverable from known accumulations using established technology or technology under development, but which are not currently considered to be commercially recoverable due to one or more contingencies. Contingencies may include factors such as economic, legal, environmental, political, and regulatory matters, or a lack of markets. It is also appropriate to classify as contingent resources the estimated discovered recoverable quantities associated with a project in the early evaluation stage. Contingent Resources are further classified in accordance with the level of certainty associated with the estimates and may be subclassified based on project maturity and/or characterized by their economic status.

The subparagraphs that follow discuss these contingencies. Any drilling or testing that is required to confirm the presence of a known accumulation beyond reasonable distances of extrapolation from an existing data point are not contingencies but prerequisites.

Some Oil and Gas Issuers are of the view that the statement, "[i]t is also appropriate to classify as contingent resources the estimated discovered recoverable quantities associated with a project in the early evaluation stage"{18} contained within the above-noted definition of "contingent resources" is the only criterion for the assignment of contingent resources. What constitutes "early evaluation stage" is unclear and, by itself, inadequate as a classification criterion. To avoid misleading disclosure, the Oil and Gas Issuer must satisfy the specific requirements for classification as a contingent resource.

Contingencies can be economic, other non-technical, or technical.

A. Economic Contingency

Economic contingency is dealt with by sub-classifying a contingent resource, as described in subsection 5.3.4.a of Volume 1 of the COGE Handbook as an economic or sub-economic contingent resource. A contingent resource is an estimate of recoverable volumes from a defined project under specified economic conditions. We would likely consider it to be misleading to disclose a contingent resource without also disclosing whether it is currently economic or sub-economic. The same subsection of the COGE Handbook also states the following:

When evaluations are incomplete such that it is premature to identify the economic viability of a project, it is acceptable to note that project economic status is 'undetermined' (i.e., 'contingent resources -- economic status undetermined').

We do not consider it is reasonable to continue to classify a project as "economic status undetermined" beyond a limited period without providing a clear and specific explanation and meaningful disclosure about the time for completion of an economic evaluation. If the Oil and Gas Issuer makes no attempt to determine economic viability, it would be appropriate to reclassify the resources associated with a project as sub-commercial contingent resources with a discussion of what would be required to achieve commerciality.

Disclosure of any class of resource is at a point in time, the "Effective Date", with the information available at that time. Information to be acquired in the future may be incorporated in subsequent evaluations, but is not a contingency that justifies classification as "economic status undetermined". In particular, classification as "economic status undetermined" is not appropriate for areas in which drilling and/or testing is still required to satisfy the "known accumulation" criterion.

If the classification is as a sub-economic contingent resource, it may be misleading to fail to disclose the changes in economic conditions that are required for the achievement of economic viability.

B. Non-Technical Contingency

Non-technical contingencies identified in the COGE Handbook are legal, environmental, political, and regulatory matters, or a lack of markets. In order to not be misleading, additional disclosure on these, or other relevant non-technical contingencies, may be required.

C. Technical Contingency

A prerequisite for the evaluation of a contingent resource requires the application of a development project using technology that is established or is under development.

(1) Established Technology

Established technology is technology that is in use in one or more of the following:

• in the reservoir of interest; or

• in a reservoir that is a good analogy.

By definition, a technology is not a contingency if it is an established technology for the subject reservoir. However, it is not sufficient that technology is applicable to a reservoir of any type; to be an established technology, it must be applicable in the reservoir of interest.

(2) Technology Under Development

When an Oil and Gas Issuer cannot conduct an evaluation on the basis of established technology, contingent resources may be assigned on the basis of "technology under development". Section 5.3.3 of Volume 1 of the COGE Handbook, titled "Commercial Risk" defines "technology under development" as "technology that has been developed and verified by testing as feasible for future commercial applications to the subject reservoir".

The COGE Handbook indicates that technology under development may only be used where all conditions of the above definition have been met, including:

• technology that has been developed -- This condition effectively limits the technology to existing technology that has been developed in analogous reservoirs.

• verified by testing as feasible for future commercial applications -- This condition implies that there has been a successful pilot project in the reservoir of interest or a good, relevant analog. A lower level of evidence may not meet this condition. For example, laboratory tests on cores alone, temporary stimulation (e.g., by hot water, cold solvent) of short term flow, or simulation alone, would not be adequate evidence for classification as a contingent resource.

• to the subject reservoir -- This condition requires careful examination and comparative analysis of the reservoir characteristics to confirm that the technology is specifically applicable to that reservoir. Completion technology that has been successfully applied, for example, in one shale gas area, may not be applied to other shale gas areas without careful consideration of the specific relevant factors.

Technology that may be described generally as being "under development" including experimental technology but that does not satisfy the requirements specified above, cannot be used to justify a classification as contingent resources.

The term "under development" implies that there is active pursuit of the technology, although this need not be by the Oil and Gas Issuer provided that the technology will become available to the Oil and Gas Issuer. In addition to the guidelines specified in the COGE Handbook, for disclosure to be consistent with the requirements of NI 51-101 the technology should be expected to be available within a reasonable period of time. In respect of reserves, the timelines set forth in subsection 5.5.4.f of Volume 1 of the COGE Handbook, titled "Timing of Production and Development," also provide appropriate guidance on the timelines that should be considered regarding "technology under development" in relation to decisions on the classification of resources.

(vii) Disclosure of Contingent Resources

There is limited guidance on contingent resources in the COGE Handbook. We are aware of the varied interpretations of the disclosure requirements relating to contingent resources by evaluators and Oil and Gas Issuers. As a result, we recommend the following:

A. Identification - Identify the contingencies under headings, which may include one or more of the following:

• Economic. This is a contingency only for a sub-economic contingent resource, not for an economic contingent resource;

• Non-Technical. Examples include, factors such as legal, environmental, political, and regulatory matters or a lack of markets; and

• Technical. This is a contingency for the case of technology under development, not when there is established technology.

B. Itemize Contingencies - Under the headings identifying contingency factors (see above), itemize the relevant contingencies and provide a meaningful explanation of steps needed to remove the contingencies. Boilerplate disclosure is inadequate. Drilling to confirm the presence of a hydrocarbon bearing reservoir or testing to confirm its productivity (i.e., to satisfy the known accumulation criterion) are not contingencies;{19} if such drilling or testing is necessary then it does not reflect the information available at the evaluation date and the appropriate classification is likely to be as a prospective resource. Next, describe the technology, which may include one of the following:

• Established Technology. Include a brief description of the technology and how it is applicable to the subject reservoir. This will not generally require extensive or detailed disclosure; or

• Technology Under Development. Describe the technology in sufficient detail for an investor to understand the likelihood that it will become an established technology for that reservoir and when this is expected to happen. When doing so, consider the specific requirements of the definition of "technology under development," which states: "... technology that has been developed and verified by testing as feasible for future commercial applications to the subject reservoir" [emphasis added].

(e) Classification to Most Specific Class and Category of Reserve

Paragraph 5.9(2)(c) of NI 51-101 requires an estimate of resources other than reserves to "be classified in the most specific category of resources other than reserves". Where disclosure of total, discovered or undiscovered PIIP{20} is provided, subsection 5.16(2) of NI 51-101 requires the disclosure of each of the subcategories that make up total PIIP, discovered PIIP and undiscovered PIIP. These provisions in NI 51-101 address concerns about disclosure of volumes of discovered PIIP and undiscovered PIIP in circumstances where there has been no meaningful indication that commerciality could be attained.

Section 5.3 of Companion Policy 51-101CP Companion Policy to National Instrument 51-101 (51-101CP) contemplates as "exceptional circumstances" a situation in which an Oil and Gas Issuer is unable to classify a discovered resource into one of the subcategories of discovered resources. The guidance in 51-101CP originally reflected established mining practice, which requires a pre-feasibility or a feasibility study before reserves are assigned to mining operations. In that case, the recovery technology is well established but commerciality requires confirmation. The applicability of "exceptional circumstances" for recovery of hydrocarbons by means other than mining would be limited to situations in which it is not possible to define a project{21} for the recovery of a resource from a petroleum accumulation. Subsection 5.16(3) of NI 51-101 provides for this by allowing the disclosure of discovered PIIP without disclosure of reserves or contingent resources. However, subsection 5.16(3) of NI 51-101 only applies when the Oil and Gas Issuer cannot disclose the more specific class, and is not an option that may be exercised to avoid disclosure of the most specific class and category, including the fact that the resources are currently unrecoverable, when the information is or can be made available.

If Oil and Gas Issuers can develop projects using several recovery processes but no decision has been made among them, one or more of such possible processes may be reflected in an evaluation as the basis of disclosure, and the results disclosed in an appropriate class (most likely contingent resources) with relevant discussion.

The definition of discovered PIIP includes the following statement: "the recoverable portion of discovered petroleum initially-in-place includes production, reserves, and contingent resources; the remainder is unrecoverable". Therefore, any volume for which a project cannot be defined and evaluated for classification of production, reserves, contingent resources or, in the case of undiscovered PIIP, prospective resources, at the evaluation date, is by definition, unrecoverable at the time of the evaluation.

Oil and Gas Issuers with volumes currently classified as unrecoverable but who are developing recovery projects, possibly at an experimental level, may describe their activities in the disclosure, provided it is accompanied by a discussion of significant positive and negative factors.{22}

(f) Stand-Alone Possible Reserves

Stand-alone possible reserves are possible reserves that are assigned to a property for which no proved or probable reserves volumes have been assigned. We think it is potentially misleading to disclose possible reserves on a stand-alone basis. Situations in which it might be appropriate to disclose possible reserves on a stand-alone basis are rare, but could include any one or more of the following:

• project economics are such that no proved or probable reserves can be assigned, but on a proved + probable + possible reserves basis the project is economically viable, and a development decision has been made (e.g., adding compression, expanding facilities, offshore development of a structure delineated mainly with seismic with only limited well control);

• only minor expenditure is required to develop the possible reserves and development is likely to proceed in the near future (e.g., behind-pipe zones in a well which has proved or probable reserves in another interval);

• possible reserves may be assigned to that part of an accumulation for which an Oil and Gas Issuer has the rights when proved or probable reserves have been assigned to adjacent parts of the same accumulation for which the Oil and Gas Issuer does not have rights.

In all of these situations, there should be an intention to develop the stand-alone possible reserves within a reasonable time.

In these situations, an Oil and Gas Issuer that includes material stand-alone possible reserves in its disclosure should also disclose the fact that such reserves are classified as stand-alone possible reserves, provide a clear proximate explanation as to why the possible reserves have been disclosed on a stand-alone basis and also include the cautionary statement required by subparagraph 5.2(a)(v) of NI 51-101 regarding possible reserves.

(g) Aggregation of Resource Estimates for Several Properties

Oil and Gas Issuers may aggregate volumes of the same class, but not of different classes.

Current guidance on the aggregation of resource estimates is provided in subsection 5.2(4) of 51-101CP, titled "Probabilistic and Deterministic Evaluation Methods" and in section 9.6 of Volume 1 of the COGE Handbook, titled "Reserves Aggregation". Although the general principles discussed in those publications are relevant to the aggregation of all resource classes, the guidance in 51-101CP and the COGE Handbook was written primarily to address the aggregation of reserves data (i.e., of proved and of proved + probable reserves). Below we provide additional guidance on the disclosure of aggregated estimates that include resources other than reserves data.

(i) Probabilistic Aggregation of Resource Estimates for Several Properties

Guidance found in subsection 5.2(4) of 51-101CP on the probabilistic aggregation of reserves titled "Probabilistic and Deterministic Evaluation Methods" and in section 5.5.3 of Volume 1 of the COGE Handbook, titled "Aggregation of Reserves Estimates" is also applicable to disclosure of estimates of resources other than reserves data.

(ii) Arithmetic Aggregation of Resource Estimates for Several Properties

Proved, proved + probable and proved + probable + possible reserves estimates and high, best, and low estimates of other resource classes are measures of the probability that actual remaining recovered quantities will exceed the disclosed volumes. Disclosure of the arithmetic sum of low estimates or high estimates of multiple properties may be misleading.

Proved + probable reserves, and best estimates of other resource classes, are generally considered to be approximations to a mean estimate{23} and, as such, their summation provides meaningful information and may be disclosed without misleading readers.

However, when other estimates are aggregated (e.g., multiple estimates of proved + probable + possible reserves or multiple high estimates of other resource classes) statistical principles indicate that the resulting sums will lie beyond a reasonable range of expected actual outcomes and, therefore, will potentially mislead readers.

Accordingly, where an Oil and Gas Issuer discloses an arithmetic aggregation of several proved + probable + possible reserves estimates or of several high estimates of other resource classes, the Oil and Gas Issuer should consider (in addition to applying the guidance set out in subsection 5.2(4) of 51-101CP) accompanying the disclosure with a clear cautionary statement to the following effect:

This volume is an arithmetic sum of multiple estimates of [identify reserves or resource classes], which statistical principles indicate may be misleading as to volumes that may actually be recovered. Readers should give attention to the estimates of individual classes of [reserves or resources] and appreciate the differing probabilities of recovery associated with each class as explained [indicate where disclosed and explained].

Example: Arithmetic Aggregation

Reserves in Bcf	Proved (circa P90)	Proved + Probable (circa P50)	Proved + Probable + Possible (circa P10)
Property 1	10	20	50
Property 2	12	18	30
Property 3	5	12	25
Property 4	25	40	75
Property 5	32	50	80
Total	84	140	260

Probability of getting:

More than	84 Bcf	>> 90% (much greater than 90%)
About	140 Bcf	~ 50% (equal likelihood of getting more or less)
More than	260 Bcf	<< 10% (much less than 10%)

That is, the probability that the combined production from all properties will exceed 260 Bcf is much lower (perhaps 1%) than the criterion for proved + probable + possible reserves (i.e., a 10% probability of recovering a greater volume). Conversely, the probability that actual production will exceed 84 Bcf is considerably greater (perhaps 98%).

This example uses P90, P50, and P10 criteria, but the same argument applies for any estimates that are greater or less than a mean, whether they have been determined using deterministic or probabilistic methods.

(h) Use of the Term "Best Estimate"

The term "best estimate" is defined in Appendix A of Volume 1 of the COGE Handbook with respect to entity-level estimates as follows:

...the value derived by an evaluator using deterministic methods that best represents the expected outcome with no optimism or conservatism... If probabilistic methods are used, there should be at least a 50 percent probability (P₅₀) that the quantities actually recovered will equal or exceed the best estimate.

The term "best estimate" should not be used to describe the results of arithmetic or probabilistic aggregation of resource estimates, unless these are risked in the aggregation process in such a manner that the aggregated value is strictly in accord with the definition of "best estimate" (refer to section 5.3.5 of Volume 1 of the COGE Handbook, titled "Uncertainty Categories").

(i) Prospective Resources

When disclosing prospective resources, Oil and Gas Issuers should note the mandatory cautionary statement that is required proximate to the disclosure{24}, "There is no certainty that any portion of the resources will be discovered. If discovered, there is no certainty that it will be commercially viable to produce any portion of the resources."

For a prospective resource, the chance of commerciality is the product of two factors, the chance of discovery and the chance of development{25} and in addition to the above cautionary statement, additional information on these factors may be required in order to avoid misleading disclosure; including discussion of the likelihood of a successful discovery (which could be as a probability of success) and, in the case of a successful discovery, of the likelihood and timing of commercial development.

We have seen Oil and Gas Issuers disclose prospective resources that are risked for the chance of discovery but not for the chance of development, typically where there is an exploration program that includes several wells. We have seen calculation errors with this procedure. Oil and Gas Issuers that disclose the results of such calculations should accompany the disclosure with a proximate statement to the following effect:

These are partially risked prospective resources that have been risked for chance of discovery, but have not been risked for chance of development. If a discovery is made, there is no certainty that it will be developed or, if it is developed, there is no certainty as to the timing of such development.

Any discussion by Oil and Gas Issuers about the chance of development should provide meaningful information on the risks, uncertainties, and timing of development if a discovery is made.

Questions

Please refer any questions you may have regarding this Notice to any of the following:

{1} See NI 51-101, section 5.9.

{2} See CSA Notice of Amendments to National Instrument 51-101 Standards of Disclosure for Oil and Gas Activities and related and consequential amendments, published 15 October 2010.

{3} Available on the Alberta Securities Commission website at: http://www.albertasecurities.com/securitiesLaw/Regulatory%20Instruments/5/2232/COGEHs.5DefinitionsofOilandGasResourcesandReserves.pdf

{4} See section 5.1.1 of Volume 1 of the COGE Handbook.

{5} Further, it may be misleading for an Oil and Gas Issuer to disclose the result of an evaluation for a project that the Oil and Gas Issuer may not be able, or does not intend, to carry out without disclosing this fact and providing a discussion of how the disclosed value of the project could be realized.

{6} See National Instrument 51-102 Continuous Disclosure Obligations (NI 51-102), section 7.1.

{7} An example of such a professional organisation is the Association of Professional Engineers, Geologists and Geophysicists of Alberta (APEGGA), which recognises the COGE Handbook as the practice standard for oil and gas evaluation. Each evaluator, whether independent or an employee of an Oil and Gas Issuer, must be mindful at all times of obligations imposed on them as an individual member of a professional organization. A particular example of such professional obligation is the adherence to the APEGGA Guideline for Ethical Practice. Another example of such a professional organisation is the Association of Professional Engineers and Geoscientists of British Columbia.

{8} See clause 2(a)(i)(A) of this Notice.

{9} See section 5.3.3 of Volume 1 of the COGE Handbook.

{10} NI 51-101, paragraphs 1.1(x) and (y).

{11} For example, Rule 2 of the Guideline for Ethical Practice of APEGGA states, "professional engineers, geologists and geophysicists shall undertake only work that they are competent to perform by virtue of their training and experience."

{12} See subparagraph 2(a)(i)(A) of this Notice.

{13} Hodgin, J. E. and Harrell, D. R., 2006, "The Selection, Application, and Misapplication of Reservoir Analogs for the Estimation of Petroleum Reserves," SPE Paper 102505-MS.

{14} Sidle, R. E. and Lee, W. J., 2010, "An Update on the Use of Reservoir Analogs for the Estimation of Oil and Gas Reserves," SPE paper 129688.

{15} See section 5.3.3 of Volume 1 of the COGE Handbook, titled "Commercial Risk".

{16} A link for the SPE-PRMS can be found at http://www.spe.org/industry/reserves/prms.php.

{17} See subparagraph 5.9(2)(d)(iii) of NI 51-101.

{18} See section 5.2 of Volume 1 of the COGE Handbook.

{19} Once the known accumulation criterion has been satisfied, additional drilling that is within the area of the known accumulation required to design a recovery process could be a valid contingency.

{20} PIIP is used here as a reference to resource classes (i.e., reserves, contingent resources, prospective resources or unrecoverable resources).

{21} For this purpose, a project is a program of work that can be evaluated to demonstrate its commercial viability using established technology or technology under development (refer to subparagraph 3(d)(vi)(C) of this Notice). The level of detail in a project and the sophistication of an evaluation will generally increase from prospective, to contingent resources, to reserves.

{22} See subparagraph 5.9(2)(d)(iii) of NI 51-101.

{23} This will not always be the case, especially for estimates made for frontier areas or for unconventional hydrocarbons. The implications of this should be considered when adding estimates of this nature.

{24} See subparagraph 5.9(2)(d)(v)(B) of NI 51-101.

{25} See section 5.3.3 of Volume 1 of the COGE Handbook.

Roundtable Consultation Session on CSA's Review of Minimum Amount and Accredited Investor Prospectus Exemptions

A Roundtable Consultation Session

on CSA's Review of

Minimum Amount and Accredited Investor Prospectus Exemptions

- - - - - - - - - - - - - - - - - - - -

Staff of the Ontario Securities Commission invite you to attend a roundtable consultation session as part of the Canadian Securities Administrators' (CSA) review of the minimum amount (or $150,000) prospectus exemption and accredited investor prospectus exemption.

The roundtable discussion will provide investors, issuers, registrants and professional advisors with an opportunity to share their views as to whether or not any changes to these exemptions may be appropriate.

The CSA's formal public consultation on these exemptions will conclude on February 29, 2012.

Choice of Sessions

- - - - - - - - - - - - - - - - - - - -

OBJECTIVE

On November 10, 2011, the CSA published CSA Staff Consultation Note 45-401 Review of Minimum Amount and Accredited Investor Exemptions (the Consultation Note).

The Consultation Note provides summary information regarding the minimum amount and accredited investor prospectus exemptions and sets out a number of specific consultation questions.

The purpose of the Consultation Note and related roundtable discussions is to obtain input from investors, issuers, registrants and professional advisors to inform the CSA's review of these exemptions.

For further information, please refer to the Consultation Note which is available on the OSC website at http://www.osc.gov.on.ca/en/33950.htm. Written comments may also be provided until February 29, 2012.

WHO SHOULD ATTEND

• Retail and institutional investors

• Management and representatives of issuers

• Investment dealers, advisors to investors and other registrants

• Internal and external legal counsel, auditors and other professional advisors to issuers

CONSULTATION LEADERS

Jo-Anne Matear, Elizabeth Topp and Jason Koskela (Corporate Finance), Melissa Schofield (Investment Funds) and Maria Carelli (Compliance and Registrant Regulation)

Sino-Forest Corporation et al. -- ss. 127(7), 127(8)

IN THE MATTER OF

THE SECURITIES ACT,

R.S.O. 1990, c. S.5, AS AMENDED

AND

IN THE MATTER OF

SINO-FOREST CORPORATION, ALLEN CHAN,

ALBERT IP, ALFRED C.T. HUNG, GEORGE HO

AND SIMON YEUNG

NOTICE OF HEARING

Sections 127(7) and 127(8)

WHEREAS on August 26, 2011, the Ontario Securities Commission (the "Commission") issued a temporary order pursuant to sections 127(1) and 127(5) of the Securities Act, R.S.O. 1990, c. S.5, as amended (the "Act") and an order pursuant to section 144(1) of the Act varying the prior order (together the "Temporary Order");

AND WHEREAS the Temporary Order ordered that all trading in the securities of Sino-Forest Corporation ("Sino-Forest") shall cease and that all trading by Allen Chan, Albert Ip, Alfred C.T. Hung, George Ho and Simon Yeung (the "Individual Respondents") in securities shall cease;

AND WHEREAS on September 8, 2011, the Temporary Order was extended by order of the Commission until January 25, 2012;

AND WHEREAS on September 15, 2011, the Temporary Order was varied by order of the Commission pursuant to section 144(1) of the Act in the Matter of Canadian Derivatives Clearing Corporation (the "CDCC Order") but otherwise remained in effect, unamended except as expressly provided in the CDCC Order;

TAKE NOTICE THAT the Commission will hold a hearing (the "Hearing") pursuant to subsections 127(7) and (8) of the Act in the Large Hearing Room of the Commission, 20 Queen Street West, 17th Floor, commencing on January 23, 2012 at 10:00 a.m., or as soon thereafter as the Hearing can be held;

TO CONSIDER whether it is in the public interest for the Commission:

(i) to extend the Temporary Order, pursuant to sections 127(7) and (8) of the Act, in regard to all trading in the securities of Sino-Forest until April 16, 2012, or until such further time as considered necessary by the Commission;

(ii) to extend the Temporary Order, pursuant to sections 127(7) and (8) of the Act, in regard to all trading by the Individual Respondents until April 16, 2012, or until such further time as considered necessary by the Commission; and

(iii) to make such further orders as the Commission considers appropriate;

BY REASON OF the recitals set out in the Temporary Order and such allegations and evidence as counsel may advise and the Commission may permit;

AND TAKE FURTHER NOTICE that any party to the proceedings may be represented by counsel at the Hearing;

AND TAKE FURTHER NOTICE that upon failure of any party to attend at the time and place aforesaid, the Hearing may proceed in the absence of that party and such party is not entitled to further notice of the proceeding.

DATED at Toronto this 13th day of January, 2012.

Ground Wealth Inc. et al. -- ss. 127(7), 127(8)

IN THE MATTER OF

THE SECURITIES ACT,

R.S.O. 1990, c. S.5, AS AMENDED

AND

IN THE MATTER OF

GROUND WEALTH INC., ARMADILLO ENERGY INC.,

PAUL SCHUETT, DOUG DEBOER, JAMES LINDE,

SUSAN LAWSON, MICHELLE DUNK,

ADRION SMITH, BIANCA SOTO AND

TERRY REICHERT

NOTICE OF HEARING

Sections 127(7) & 127(8)

WHEREAS the Ontario Securities Commission (the "Commission") issued a temporary order on July 27, 2011 (the "Temporary Order") pursuant to sections 127(1) and 127(5) of the Securities Act, R.S.O. 1990, c. S.5, as amended (the "Act") that:

1. pursuant to paragraph 2 of subsection 127(1) that all trading in the securities of Armadillo Energy Inc. ("the Armadillo Securities") shall cease;

2. pursuant to paragraph 2 of subsection 127(1) that Armadillo Energy Inc. ("Armadillo), Ground Wealth Inc. ("GWI"), Paul Schuett ("Schuett"), Doug DeBoer ("DeBoer"), James Linde ("Linde"), Susan Lawson ("Lawson"), Michelle Dunk ("Dunk"), Adrion Smith ("Smith"), Bianca Soto ("Soto") and Terry Reichert ("Reichert") shall cease trading in all securities;

3. pursuant to subsection 127(6) that this order shall take effect immediately and shall expire on the fifteenth day after its making unless extended by order of the Commission.

AND WHEREAS on August 11, 2011 the Commission held a hearing to consider whether it is in the public interest to extend the Temporary Order pursuant to subsections 127(7) and 127(8), and heard submissions from counsel for the Respondents and from Staff of the Commission;

AND WHEREAS on August 11, 2011, the Commission extended the Temporary Order to February 13, 2012 on the same terms and conditions as provided for in the Temporary Order; provided the Temporary Order shall not prevent a Respondent from trading for the Respondent's own account, solely through a registered dealer or a registered dealer in a foreign jurisdiction (which dealer must be given a copy of the Temporary Order dated August 11, 2011 (the "Amended Temporary Order")), in (a) any "exchange traded security" or "foreign exchange traded security" within the meaning of National Instrument 21-101, provided the Respondent does not own beneficially or exercise control or direction over more than 5 per cent of the voting or equity securities of the issuer of any such securities, or (b) any security issued by a mutual fund that is a reporting issuer; and provided the Respondent provides Staff with the particulars of the accounts in which such trading is to occur before any trading in such accounts occurs;

TAKE NOTICE THAT the Commission will hold a hearing pursuant to subsections 127(7) and 127(8) of the Act at the offices of the Commission, 17th Floor, 20 Queen Street West, Toronto, commencing on February 8, 2012 at 11:00 am or as soon thereafter as the hearing can be held;

TO CONSIDER whether it is in the public interest for the Commission:

1. to extend the Amended Temporary Order pursuant to subsections 127(7) and 127(8) of the Act until the conclusion of the hearing or until such further time as considered necessary by the Commission; and

2. to make such further orders as the Commission considers appropriate;

BY REASON OF the facts recited in the Amended Temporary Order and of such allegations and evidence as counsel may advise and the Commission may permit;

AND TAKE FURTHER NOTICE that any party to the proceeding may be represented by counsel at the hearing;

AND TAKE FURTHER NOTICE that upon failure of any party to attend at the time and place aforesaid, the hearing may proceed in the absence of that party and such party is not entitled to further notice of the proceeding.

Dated at Toronto this 13th day of January, 2012.

Global Energy Group, Ltd. et al. -- ss. 37, 127

IIN THE MATTER OF

THE SECURITIES ACT,

R.S.O. 1990, c. S.5, AS AMENDED

AND

IN THE MATTER OF

GLOBAL ENERGY GROUP, LTD., NEW GOLD

LIMITED PARTNERSHIPS, CHRISTINA HARPER,

VADIM TSATSKIN, MICHAEL SCHAUMER,

ELLIOT FEDER, ODED PASTERNAK,

ALAN SILVERSTEIN, HERBERT GROBERMAN,

ALLAN WALKER, PETER ROBINSON,

VYACHESLAV BRIKMAN,NIKOLA BAJOVSKI,

BRUCE COHEN AND ANDREW SHIFF

AND

IN THE MATTER OF

A SETTLEMENT AGREEMENT BETWEEN STAFF OF

THE ONTARIO SECURITIES COMMISSION AND

ELLIOT FEDER

NOTICE OF HEARING

(Sections 37 and 127)

TAKE NOTICE that the Ontario Securities Commission (the "Commission") will hold a hearing pursuant to sections 37 and 127 of the Securities Act, R.S.O. 1990, c. S.5, as amended (the "Act"), at the offices of the Commission located at 20 Queen Street West, Toronto, 17th Floor, on January 20, 2012 at 9:00 a.m. or as soon thereafter as the hearing can be held;

AND TAKE NOTICE that the purpose of the hearing is for the Commission to consider whether it is in the public interest to approve a settlement agreement entered into between Staff of the Commission and Elliot Feder;

BY REASON OF the allegations set out in the Statement of Allegations of Staff of the Commission dated June 8, 2010 and such additional allegations as counsel may advise and the Commission may permit;

AND TAKE FURTHER NOTICE that any party to the proceeding may be represented by counsel, if that party attends or submits evidence at the hearing;

AND TAKE FURTHER NOTICE that upon the failure of any party to attend at the time and place aforesaid, the hearing may proceed in the absence of that party, and such party is not entitled to any further notice of the proceeding.

DATED at Toronto this 18th day of January, 2012.

Irwin Boock et al. -- ss. 127(1), 127.1

IN THE MATTER OF

THE SECURITIES ACT,

R.S.O. 1990, c. S.5, AS AMENDED

AND

IN THE MATTER OF

IRWIN BOOCK, STANTON DEFREITAS, JASON

WONG, SAUDIA ALLIE, ALENA DUBINSKY, ALEX

KHODJIAINTS,SELECT AMERICAN TRANSFER

CO., LEASESMART, INC., ADVANCED GROWING

SYSTEMS, INC., INTERNATIONAL ENERGY LTD.,

NUTRIONE CORPORATION, POCKETOP

CORPORATION, ASIA TELECOM LTD.,

PHARM CONTROL LTD., CAMBRIDGE RESOURCES

CORPORATION, COMPUSHARE TRANSFER

CORPORATION, FEDERATED PURCHASER, INC.,

TCC INDUSTRIES, INC., FIRST NATIONAL

ENTERTAINMENT CORPORATION, WGI HOLDINGS,

INC. AND ENERBRITE TECHNOLOGIES GROUP

AND

IN THE MATTER OF

A SETTLEMENT AGREEMENT BETWEEN STAFF OF

THE ONTARIO SECURITIES COMMISSION AND

STANTON DEFREITAS

NOTICE OF HEARING

(Subsections 127(1) and 127.1)

TAKE NOTICE that the Ontario Securities Commission (the "Commission") will hold a hearing pursuant to section 127(1) and 127.1 of the Securities Act, R.S.O., 1990, c. S.5, as amended (the "Act") at its offices at 20 Queen Street West, 17th Floor, Toronto, Ontario, on January 20, 2012 at 10:00 a.m. or as soon thereafter as the hearing can be held:

AND TAKE NOTICE that the purpose of the hearing is for the Commission to consider whether it is in the public interest to approve the settlement agreement between Staff of the Commission and the Respondent Stanton DeFreitas;

BY REASON OF the allegations set out in the Amended Statement of Allegations dated January 5, 2012 and such additional allegations as counsel may advise and the Commission may permit;

AND TAKE FURTHER NOTICE that any party to the proceedings may be represented by counsel at the hearing; and

AND TAKE FURTHER NOTICE that upon failure of any party to attend at the time and place aforesaid, the hearing may proceed in the absence of that party and such party is not entitled to any further notice of the proceeding.

DATED at Toronto this 18th day of January, 2012.

Global Consulting and Financial Services et al.

FOR IMMEDIATE RELEASE

January 12, 2012

IN THE MATTER OF

THE SECURITIES ACT,

R.S.O. 1990, c. S.5, AS AMENDED

AND

IN THE MATTER OF

GLOBAL CONSULTING AND FINANCIAL SERVICES,

CROWN CAPITAL MANAGEMENT CORPORATION,

CANADIAN PRIVATE AUDIT SERVICE,

EXECUTIVE ASSET MANAGEMENT,

MICHAEL CHOMICA, PETER SIKLOS (also known as

PETER KUTI), JAN CHOMICA, AND LORNE BANKS

TORONTO -- The Commission issued a Temporary Order in the above named matter which provides that the Amended Temporary Order is extended to April 12, 2012 and the hearing is adjourned to April 11, 2012 at 10:00 a.m., or such other date and time as set by the Office of the Secretary and agreed to by the parties.

A copy of the Temporary Order dated January 11, 2012 is available at www.osc.gov.on.ca.

For media inquiries:

For investor inquiries:

Portus Alternative Asset Management Inc. et al.

FOR IMMEDIATE RELEASE

January 13, 2012

IN THE MATTER OF

THE SECURITIES ACT,

R.S.O. 1990, c. S.5, AS AMENDED

AND

IN THE MATTER OF

PORTUS ALTERNATIVE ASSET MANAGEMENT

INC., PORTUS ASSET MANAGEMENT INC.,

BOAZ MANOR, MICHAEL MENDELSON,

MICHAEL LABANOWICH AND JOHN OGG

TORONTO -- The Commission issued an Order in the above named matter which provides that the hearing is adjourned to April 25, 2012 at 10:00 a.m. for the purpose of continuing the pre-hearing conference.

A copy of the Order dated January 12, 2012 is available at www.osc.gov.on.ca.

For media inquiries:

For investor inquiries:

Sino-Forest Corporation et al.

FOR IMMEDIATE RELEASE

January 13, 2012

IN THE MATTER OF

THE SECURITIES ACT,

R.S.O. 1990, c. S.5, AS AMENDED

AND

IN THE MATTER OF

SINO-FOREST CORPORATION, ALLEN CHAN,

ALBERT IP, ALFRED C.T. HUNG, GEORGE HO

AND SIMON YEUNG

TORONTO -- The Office of the Secretary issued a Notice of Hearing today setting the matter down to be heard on January 23, 2012 at 10:00 a.m. to consider whether it is in the public interest for the Commission to extend the Temporary Order made as of August 26, 2011.

A copy of the Notice of Hearing dated January 13, 2012 is available at www.osc.gov.on.ca.

For media inquiries:

For investor inquiries:

Ground Wealth Inc. et al.

FOR IMMEDIATE RELEASE

January 16, 2012

IN THE MATTER OF

THE SECURITIES ACT,

R.S.O. 1990, c. S.5, AS AMENDED

AND

IN THE MATTER OF

GROUND WEALTH INC., ARMADILLO ENERGY INC.,

PAUL SCHUETT, DOUG DEBOER, JAMES LINDE,

SUSAN LAWSON, MICHELLE DUNK,

ADRION SMITH, BIANCA SOTO AND

TERRY REICHERT

TORONTO -- The Office of the Secretary issued a Notice of Hearing on January 13, 2012 setting the matter down to be heard on February 8, 2012 at 11:00 a.m. to consider whether it is in the public interest for the Commission:

(1) to extend the Temporary Order pursuant to subsections 127(7) and (8) of the Act until the conclusion of the hearing, or until such further time as considered necessary by the Commission; and

(2) to make such further orders as the Commission considers appropriate.

A copy of the Notice of Hearing dated January 13, 2012 is available at www.osc.gov.on.ca.

For media inquiries:

For investor inquiries:

David M. O'Brien

FOR IMMEDIATE RELEASE

January 16, 2012

IN THE MATTER OF

THE SECURITIES ACT,

R.S.O. 1990, c. S.5, AS AMENDED

AND

IN THE MATTER OF

DAVID M. O'BRIEN

TORONTO -- The Commission issued an Order in the above named matter which provides that the confidential pre-hearing conference is adjourned to January 31, 2012 at 3:30 p.m., or to such other date or time as set by the Office of the Secretary and agreed to by the parties.

A copy of the Order dated January 11, 2012 is available at www.osc.gov.on.ca.

For media inquiries:

For investor inquiries:

Peter Beck et al.

FOR IMMEDIATE RELEASE

January 18, 2012

IN THE MATTER OF

THE SECURITIES ACT,

R.S.O. 1990, c. S.5, AS AMENDED

AND

IN THE MATTER OF

PETER BECK, SWIFT TRADE INC. (continued as

7722656 Canada Inc.), BIREMIS, CORP.,

OPAL STONE FINANCIAL SERVICES S.A.,

BARKA CO. LIMITED, TRIEME CORPORATION and

a limited partnership referred to as "ANGUILLA LP"

TORONTO -- Following a hearing held today, the Commission issued an Order in the above named matter which provides that, on consent of all parties, the hearing for the Temporary Order shall be adjourned from January 18, 2012 to May 29, 30, 31 and June 1, 2012, or such further or other dates as may be agreed upon by the parties and fixed by the Office of the Secretary, or as ordered by the Commission.

A copy of the Order dated January 18, 2012 is available at www.osc.gov.on.ca.

For media inquiries:

For investor inquiries:

Global Energy Group, Ltd. et al.

FOR IMMEDIATE RELEASE

January 18, 2012

IN THE MATTER OF

THE SECURITIES ACT,

R.S.O. 1990, c. S.5, AS AMENDED

AND

IN THE MATTER OF

GLOBAL ENERGY GROUP, LTD., NEW GOLD

LIMITED PARTNERSHIPS, CHRISTINA HARPER,

VADIM TSATSKIN, MICHAEL SCHAUMER,

ELLIOT FEDER, ODED PASTERNAK,

ALAN SILVERSTEIN, HERBERT GROBERMAN,

ALLAN WALKER, PETER ROBINSON,

VYACHESLAV BRIKMAN,NIKOLA BAJOVSKI,

BRUCE COHEN AND ANDREW SHIFF

AND

IN THE MATTER OF

A SETTLEMENT AGREEMENT BETWEEN STAFF OF

THE ONTARIO SECURITIES COMMISSION AND

ELLIOT FEDER

TORONTO -- The Office of the Secretary issued a Notice of Hearing for a hearing to consider whether it is in the public interest to approve a settlement agreement entered into by Staff of the Commission and Elliot Feder. The hearing will be held on January 20, 2012 at 9:00 a.m. in Hearing Room C on the 17th floor of the Commission's offices located at 20 Queen Street West, Toronto.

A copy of the Notice of Hearing dated January 18, 2012 is available at www.osc.gov.on.ca.

For media inquiries:

For investor inquiries:

Irwin Boock et al.

FOR IMMEDIATE RELEASE

January 18, 2012

IN THE MATTER OF

THE SECURITIES ACT,

R.S.O. 1990, c. S.5, AS AMENDED

AND

IN THE MATTER OF

IRWIN BOOCK, STANTON DEFREITAS, JASON

WONG, SAUDIA ALLIE, ALENA DUBINSKY, ALEX

KHODJIAINTS,SELECT AMERICAN TRANSFER

CO., LEASESMART, INC., ADVANCED GROWING

SYSTEMS, INC., INTERNATIONAL ENERGY LTD.,

NUTRIONE CORPORATION, POCKETOP

CORPORATION, ASIA TELECOM LTD.,

PHARM CONTROL LTD., CAMBRIDGE RESOURCES

CORPORATION, COMPUSHARE TRANSFER

CORPORATION, FEDERATED PURCHASER, INC.,

TCC INDUSTRIES, INC., FIRST NATIONAL

ENTERTAINMENT CORPORATION, WGI HOLDINGS,

INC. AND ENERBRITE TECHNOLOGIES GROUP

AND

IN THE MATTER OF

A SETTLEMENT AGREEMENT BETWEEN STAFF OF

THE ONTARIO SECURITIES COMMISSION AND

STANTON DEFREITAS

TORONTO -- The Office of the Secretary issued a Notice of Hearing for a hearing to consider whether it is in the public interest to approve a settlement agreement entered into by Staff of the Commission and Stanton DeFreitas. The hearing will be held on January 20, 2012 at 10:00 a.m. in Hearing Room C on the 17th floor of the Commission's offices located at 20 Queen Street West, Toronto.

A copy of the Notice of Hearing dated January 18, 2012 is available at www.osc.gov.on.ca.

For media inquiries:

For investor inquiries:

Chapter 2 -- Decisions, Orders and Rulings

Acker Finley Canada Focus Fund -- s. 1(10)

Headnote

Securities Act (Ontario) -- relief granted to cease being a reporting issuer in the provinces of Canada -- filer able to make necessary representations for granting relief on a simplified basis under OSC Staff Notice 12-703 -- Preferred Format of Applications to the Director under Clause 1(10)(b)Section 83 of the Securities Act.

Applicable Legislative Provisions

Securities Act (Ontario), s. 1(10).

December 16, 2011

Dear Sirs/Mesdames:

The Applicant has applied to the local securities regulatory authority or regulator (the Decision Maker) in each of the Jurisdictions for a decision under the securities legislation (the Legislation) of the Jurisdictions that the Applicant is not a reporting issuer.

As the Applicant has represented to the Decision Makers that:

(a) the outstanding securities of the Applicant, including debt securities, are beneficially owned, directly or indirectly, by fewer than 15 security holders in each of the jurisdictions in Canada and fewer than 51 security holders in total in Canada;

(b) no securities of the Applicant are traded on a marketplace as defined in National Instrument 21-101 Marketplace Operation;

(c) the Applicant is applying for a decision that it is not a reporting issuer in all of the jurisdictions in Canada in which it is currently a reporting issuer; and

(d) the Applicant is not in default of any of its obligations under the Legislation as a reporting issuer,

each of the Decision Makers is satisfied that the test contained in the Legislation that provides the Decision Maker with the jurisdiction to make the decision has been met and orders that the Applicant is not a reporting issuer.

Gluskin Sheff + Associates Inc.

Headnote

National Policy 11-203 -- Process for Exemptive Relief Applications in Multiple Jurisdictions -- Relief granted to permit (i) interfund trading at 'last sale price' based on UMIR Rules, between a manager's pooled funds, and managed accounts.

Applicable Legislative Provisions

National Instrument 31-103 Registration Requirements, ss. 13.5(2)(b)(ii) and (iii), 15.1.

National Instrument 81-107 Independent Review Committee for Investment Funds, ss. 6.1(2), 6.1(4).

January 12, 2012

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

GLUSKIN SHEFF + ASSOCIATES INC.

(the Filer)

DECISION

Background

The principal regulator in the Jurisdiction (the Principal Regulator) has received an application from the Filer for a decision under the securities legislation of the Jurisdiction of the Principal Regulator (the Legislation) for an exemption from the prohibition against a registered adviser knowingly causing an investment portfolio managed by it, including an investment fund for which it acts as an adviser, to purchase or sell a security from or to (i) the investment portfolio of an associate of a responsible person or (ii) an investment fund for which a responsible person acts as an adviser, to permit the purchase and sale of securities of any issuer (each purchase and sale, an Inter-Fund Trade):

(a) between a Pooled Fund (defined below) and another Pooled Fund or a Managed Account (defined below);

(b) between a Managed Account and a Pooled Fund; and

(c) to occur at the last sale price, as defined in the Market Integrity Rules of the Investment Industry Regulatory Organization of Canada, prior to the execution of the trade (the Last Sale Price) or at the closing sale price (the Closing Sale Price) contemplated by the definition of current market price referred to in paragraph (e) of section 6.1(2) of National Instrument 81-107 Independent Review Committee for Investment Funds (NI 81-107), as determined by the Filer in its discretion,

(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 each of Alberta, British Columbia, Saskatchewan, Manitoba, Québec, Nova Scotia, New Brunswick and Northwest Territories (collectively with Ontario, the 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.

Pooled Fund means an investment fund managed and portfolio managed by the Filer or managed or portfolio managed in the future by the Filer or an affiliate, the securities of which are sold pursuant to exemptions from the prospectus requirement.

Managed Account means an account over which the Filer or an affiliate has discretionary authority, other than an account of a Responsible Person.

Responsible Person has the meaning given to this term in section 13.5(1) of National Instrument 31-103 Registration Requirements and Exemptions and Ongoing Registrant Obligations and includes each officer and director of the Filer who has access to, or participates in formulating, an investment decision or advice in respect of an Inter-Fund Trade.

Certain other defined terms have the meanings given to them below under Representations.

Representations

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

1. The Filer is a corporation incorporated under the laws of the Province of Ontario. It is registered as a portfolio manager and investment fund manager in each of the Jurisdictions, as an exempt market dealer in Ontario and Saskatchewan and as commodity trading manager in Ontario.

2. The head office of the Filer is located in Toronto, Ontario.

3. The Filer is a public company whose shares are listed on the Toronto Stock Exchange.

4. The Filer or an affiliate is or will be the portfolio manager and/or manager of each Pooled Fund.

5. A Pooled Fund may be an associate of the Filer or an affiliate of the Filer that is a responsible person in respect of another Pooled Fund or a Managed Account, as the Filer or an affiliate of the Filer may be the trustee of a Pooled Fund that is structured as a trust.

6. Each of the Pooled Funds is, or will be, qualified for distribution in the Jurisdictions pursuant to exemptions from the prospectus requirement and will not be a reporting issuer.

7. The Filer and the existing Pooled Funds are not in default of securities legislation in the Jurisdictions.

8. The Filer offers discretionary portfolio management services to clients seeking wealth management or related services under a written agreement (Discretionary Management Agreements) in connection with each Managed Account.

9. Pursuant to the Discretionary Management Agreement entered into with each client, the Filer makes investment decisions for each Managed Account and has full discretionary authority to trade in securities for each Managed Account without obtaining the specific consent or instructions of the client to the trade.

10. The Filer wishes to be able to enter into Inter-Fund Trades of portfolio securities between:

(a) a Pooled Fund and another Pooled Fund or a Managed Account; and

(b) a Managed Account and a Pooled Fund.

11. Inter-Fund Trades will result in benefits to Pooled Fund investors and Managed Account holders such as lower trading costs, reduced market disruption and faster order execution.

12. At the time of each Inter-Fund Trade, the Filer (or its affiliate) will have policies and procedures in place to enable it to engage in the applicable Inter-Fund Trade.

13. When the Filer engages in an Inter-Fund Trade of securities between two Pooled Funds or between a Managed Account and a Pooled Fund it will follow the following procedures:

(a) the portfolio manager of the Filer (or its affiliate) will request the approval of the chief compliance officer of the Filer or his or her designated alternate to execute a purchase or sale of a security by a Pooled Fund or a Managed Account as an Inter-Fund Trade;

(b) upon receipt of the required approval, the portfolio manager of the Filer (or its affiliate) will deliver the trading instructions to a trader on a trading desk of the Filer (or its affiliate);

(c) upon receipt of the trade instructions and the required approval, the trader on the trading desk will execute the trade as an Inter-Fund Trade in accordance with the requirements of paragraphs (c) to (g) of Subsection 6.1(2) of NI 81-107 provided that, for exchange-traded securities, the trader will have the discretion to execute the Inter-Fund Trade at the Last Sale Price of the security, determined at the time of the receipt of the required approval prior to the execution of the trade, or at the Closing Sale Price; and

(d) the policies applicable to the trading desk of the Filer (or its affiliate) will require that all orders are to be executed on a timely basis.

14. The Filer (or its affiliate) will establish an independent review committee (IRC) in respect of each Pooled Fund. The IRC will be composed by the Filer (or its affiliate) in accordance with section 3.7 of NI 81-107 and will be expected to comply with the standard of care set out in section 3.9 of NI 81-107. The mandate of the IRC will include approving purchases and sales of securities between a Pooled Fund and a Managed Account or between two Pooled Funds and the IRC will not approve an Inter-Fund Trade between a Pooled Fund and a Managed Account or between two Pooled Funds unless it has made the determination set out in section 5.2(2) of NI 81-107.

15. If the IRC of a Pooled Fund becomes aware of an instance where the Filer (or its affiliate), as manager of the Pooled Fund, did not comply with the terms of this decision or a condition imposed by the IRC in its approval, the IRC of the Pooled Fund will, as soon as practicable, notify in writing the securities regulatory authority or regulator in the jurisdiction under which the Pooled Fund is organized.

16. The Filer cannot rely on the exemption from Section 13.5 of NI 31-103 contained in subsection 6.1(4) of NI 81-107, as the Pooled Funds and Managed Accounts are not reporting issuers and thus are not subject to NI 81-107.

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:

(a) the Inter-Fund Trade is consistent with the investment objective of the Pooled Fund or the Managed Account, as applicable;

(b) the Filer (or its affiliate) refers the Inter-Fund Trade that involves a Pooled Fund to the IRC of the Pooled Fund in the manner contemplated by section 5.1 of NI 81-107 and the Filer (or its affiliate) and the Pooled Fund comply with section 5.4 of NI 81-107 in respect of any standing instructions the IRC provides in connection with the Inter-Fund Trade;

(c) if the transaction is with a Pooled Fund or between two Pooled Funds, the IRC of each Pooled Fund has approved the Inter-Fund Trade in respect of that Pooled Fund in accordance with the terms of Subsection 5.2(2) of NI 81-107;

(d) if the transaction is with a Managed Account, the Discretionary Management Agreement or other documentation in respect of the Managed Account contains the authorization of the client for the Filer (or its affiliate) to engage in Inter-Fund Trades; and

(e) the Inter-Fund Trade complies with paragraphs (c) to (g) of subsection 6.1(2) of NI 81-107, except that for purposes of paragraph (e) of subsection 6.1(2) in respect of exchange-traded securities, the trade is executed at the Last Sale Price or the Closing Sale Price of the security.

Sun Life Assurance Company of Canada and Sun Life Capital Trust

Headnote

NI 51-102 -- Relief from continuous disclosure requirements -- credit support issuer has securities outstanding that are not designated credit support securities because credit supporter has not provided a full and unconditional guarantee -- designated credit support securities cannot have a full and unconditional guarantee because ore regulatory capital requirements -- credit support issuer exempt from certain continuous disclosure and certification requirements under the, subject to conditions -- capital trust issuer established to provide a regulated entity with a cost effective means of raising regulatory capital -- regulated entity has provided an undertaking not to pay dividends if the capital trust issuer fails to make payments on capital trust securities -- undertaking is functional equivalent of a guarantee -- capital trust securities are ultimately exchangeable into securities of the regulated entity -- capital trust issuer exempt from certain continuous disclosure and certification requirements under the legislation, subject to conditions National Instrument 51-102 Continuous Disclosure Obligations -- National Instrument 52-109 -- Certification of Disclosure in Issuers' Annual and Interim Filings.

Applicable Legislative Provisions

National Instrument 51-102 Continuous Disclosure Obligations, ss. 13.1, 13.4.

National Instrument 52-109 Certification of Disclosure in Issuers' Annual and Interim Filings, s. 8.5.

January 12, 2012

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

SUN LIFE ASSURANCE COMPANY OF CANADA

("SLA") AND SUN LIFE CAPITAL TRUST

(the "Trust", and together with SLA, the "Filers")

DECISION

Background

The Filers received an order dated November 14, 2007 (the "2007 Order") of the securities regulatory authority or regulator of each province and territory of Canada exempting the Filers from the continuous disclosure and certification requirements of securities legislation as specified in the 2007 Order. The 2007 Order expires on January 15, 2012.

The principal regulator in the Jurisdiction has received an application from the Filers for a decision under the securities legislation of the Jurisdiction (the "Legislation") to replace the 2007 Order, and in particular to exempt the Filers from:

• the Continuous Disclosure Requirements pursuant to section 13.1 of NI 51-102 (a "Continuous Disclosure Exemption"); and

• the Certification Requirements pursuant to section 8.6 of NI 52-109 (a "Certification Exemption").

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 Filers have provided notice that section 4.7(1) of Multilateral Instrument 11-102 -- Passport System (MI 11-102) is intended to be relied upon in each of the provinces and territories other than Ontario.

Interpretation

Defined terms contained in National Instrument 14-101 -- Definitions have the same meaning in this decision unless they are defined in this decision. In this decision, the following terms have the following meanings:

"Affiliate" has the meaning given to such term in NI 51-102;

"AIF" means an annual information form;

"Annual Certificates" has the meaning given to such term in NI 52-109;

"At Par Redemption Date" means December 31, 2011;

"Automatic Exchange" means the automatic exchange of SLEECS -- Series A for SLA Preferred Shares Series Y upon the occurrence of certain events relating to the solvency of SLA or actions taken by the Superintendent in respect of the financial strength of SLA;

"Certification Requirements" means the requirements to file Annual Certificates under sections 4.1 and 6.1, as applicable, of NI 52-109 and Interim Certificates under sections 5.1 and 6.2, as applicable, of NI 52-109;

"Continuous Disclosure Filings" means:

(a) annual financial statements required by section 4.1 of NI 51-102;

(b) interim financial reports required by section 4.3 of NI 51-102;

(c) AIFs required by section 6.1 of NI 51-102;

(d) annual and interim MD&A required by section 5.1 of NI 51-102;

(e) press releases and material change reports required by section 7.1 of NI 51-102 in the case of material changes that are also material changes in the affairs of SLF; and

(f) material contracts required by section 12.2 of NI 51-102;

"Continuous Disclosure Requirements" means the requirements contained in NI 51-102 to file and deliver, as applicable, the Continuous Disclosure Filings;

"Credit Facilities" means the unsecured, non-interest bearing credit facilities provided to the Trust by SLA or its Affiliates in connection with the offerings of the SLEECS;

"Credit Support Issuer" has the meaning given to such term in NI 51-102;

"Credit Support Issuer Exemptions" means the exemption from the Continuous Disclosure Requirements in section 13.4 of NI 51-102 and the exemption from the Certification Requirements in section 8.6 of NI 52-109;

"Debt Guarantee" means the subordinated guarantee dated November 15, 2007 by SLF of SLA's payment obligations in respect of the SLA Subordinated Debentures;

"Deficiency Payment" means a payment calculated as follows:

(a) if at the date of determination a winding-up order has been made with respect to SLF, then the Deficiency Payment shall be the amount that, when paid to the holders of the SLA Preferred Shares outstanding as of the Triggering Event, will result in:

(i) the holders of SLA's Class A Shares, Class B Shares, Class C Shares and Class E Shares outstanding as of the Triggering Event receiving payment of the same proportion of the unpaid amounts on such shares as the holders of such shares would have received had their claim to such unpaid amounts on the final distribution of surplus of SLF, if any, pursuant to section 95(1) of the WURA ranked on a parity with the claims of the holders of SLF's Class A Shares; and

(ii) the holders of SLA's Class D Shares outstanding as of the Triggering Event receiving payment of the same proportion of the unpaid amounts on such shares as the holders of such shares would have received had their claim to such unpaid amounts on the final distribution of surplus of SLF, if any, pursuant to section 95(1) of the WURA ranked on a parity with the claims of the holders of SLF's Class B Shares; and

(b) in all circumstances other than those listed above, the Deficiency Payment shall be the amount equal to the aggregate unpaid amounts attributable to all classes of SLA Preferred Shares outstanding as of the Triggering Event;

"Designated Credit Support Securities" has the meaning given to such term in NI 51-102;

"Distribution Date" has the meaning given to such term in the SLEECS -- Series A Prospectus;

"Dividend Reference Period" has the meaning given to such term in the SLEECS -- Series A Prospectus;

"Dividends" has the meaning given to such term in the SLEECS -- Series A Prospectus;

"Dividend Stopper Undertaking" has the meaning given to such term in the SLEECS -- Series A Prospectus;

"Early Redemption Price" has the meaning given to such term in the SLEECS -- Series A Prospectus;

"Holder Exchange Right" means the right of holders of SLEECS -- Series A to exchange their SLEECS -- Series A for SLA Preferred Shares Series Z;

"ICA" means the Insurance Companies Act (Canada);

"ICA Financial Statements" means the audited annual financial statements of SLA prepared in compliance with section 331 of the ICA;

"Indicated Yield" means each fixed, semi-annual, non-cumulative cash distribution distributed to holders of a particular series of SLEECS;

"Interim Certificates" has the meaning given to such term in NI 52-109;

"Liquidation Preference" means any amount to which holders of a particular class or series of SLA Preferred Shares are entitled in priority to any amounts which may be payable in respect of any class of shares of SLA which rank junior to such class or series in the event of a distribution of assets upon the liquidation, dissolution or winding-up of SLA;

"MD&A" means management's discussion and analysis of the financial condition and results of operations;

"NI 45-106" means National Instrument 45-106 -- Prospectus and Registration Exemptions;

"NI 51-102" means National Instrument 51-102 -- Continuous Disclosure Obligations;

"NI 52-109" means National Instrument 52-109 -- Certification of Disclosure in Issuers' Annual and Interim Filings;

"Preferred Share Guarantee" means the subordinated preferred share guarantee dated November 15, 2007 by SLF of the amount of any declared and unpaid dividends on the SLA Preferred Shares, the Redemption Price of the SLA Preferred Shares, and the Liquidation Preference of the SLA Preferred Shares;

"Public Preferred Shares" has the meaning given to such term in the SLEECS -- Series A Prospectus;

"Redemption Price" means the amount payable by SLA following presentation and surrender of any SLA Preferred Shares which have been redeemed by SLA or which are then redeemable by the holder pursuant to the terms of such SLA Preferred Shares;

"SEDAR" means the System for Electronic Document Analysis and Retrieval;

"Series A Share Exchange Agreement" has the meaning given to the term "Share Exchange Agreement" in the SLEECS -- Series A Prospectus;

"Series B Share Exchange Agreement" means the share exchange agreement between the Trust, SLF, SLA and CIBC Mellon Trust Company, as exchange trustee, with respect to the SLEECS -- Series B;

"SLA A Debenture" means the senior debenture issued by SLA to the Trust in respect of the SLEECS -- Series A;

"SLA B Debenture" means the senior debenture issued by SLA to the Trust in respect of the SLEECS -- Series B;

"SLA Debentures" means the SLA A Debenture and the SLA B Debenture;

"SLA Dividend Restricted Shares" has the meaning given to such term in the SLEECS -- Series A Prospectus;

"SLA Preferred Shares" means the Class A Shares, Class B Shares, Class C Shares, Class D Shares and Class E Shares of SLA;

"SLA Preferred Shares Series W" means the Class A Shares -- Series W of SLA;

"SLA Preferred Shares Series X" means the Class A Shares -- Series X of SLA;

"SLA Preferred Shares Series Y" means the Class A Shares -- Series Y of SLA;

"SLA Preferred Shares Series Z" means the Class A Shares -- Series Z of SLA;

"SLA Subordinated Debentures" means the $150,000,000 principal amount of 6.30% subordinated debentures due 2028 and the $800,000,000 principal amount of 6.15% subordinated debentures due 2022;

"SLEECS" means the Sun Life ExchangEable Capital Securities of the Trust;

"SLEECS Redemption Price" has the meaning given to the term "Redemption Price" in the SLEECS -- Series A Prospectus;

"SLEECS -- Series A Prospectus" means the final prospectus of the Trust dated October 11, 2001;

"SLF" means Sun Life Financial Inc.;

"SLF Dividend Restricted Shares" has the meaning given to such term in the SLEECS -- Series A Prospectus;

"SLF Guarantees" means the Debt Guarantee and the Preferred Share Guarantee;

"SLF Preferred Shares" means, collectively, the outstanding Class A Shares and Class B Shares of SLF from time to time;

"SLF Responsible Issuer Undertaking" means the undertaking delivered by SLF to the Ontario Securities Commission confirming that:

(a) following SLF providing the SLF Guarantees and for as long as SLA and the Trust qualify for the Continuous Disclosure Exemption, SLF will be considered a "responsible issuer" for the purposes of determining its liability under Part XXIII.1 of the Securities Act (Ontario) as if the SLEECS were an "issuer's security" of SLF for the purposes of such part; and

(b) for the avoidance of doubt, pursuant to the definition of "issuer's security" in section 138.1 of the Securities Act (Ontario), the SLA Preferred Shares, the SLA Subordinated Debentures and designated credit support securities of SLA guaranteed by SLF constitute issuer's securities of SLF for purposes of determining its liability under Part XXIII.1 of the Securities Act (Ontario);

"Special Trust Securities" means the Special Trust Securities of the Trust;

"Summary Financial Information" has the meaning given to such term in NI 51-102;

"Superintendent" means the Superintendent of Financial Institutions (Canada);

"Triggering Event" means if SLA:

(a) fails to make full payment of any dividend declared on any SLA Preferred Shares on the date required for such payment;

(b) fails to make full payment of the Redemption Price when due; or

(c) becomes subject to a winding-up order (as defined in the WURA or any order of similar effect made under applicable laws for the winding-up, liquidation or dissolution of SLA);

"Trust Securities" means the Special Trust Securities and the SLEECS;

"TSX" means the Toronto Stock Exchange; and

"WURA" means the Winding-up and Restructuring Act (Canada).

Representations

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

SLF

1. SLF was incorporated on August 5, 1999 under the ICA and became the sole shareholder of SLA in 2000 pursuant to SLA's demutualization. SLF is a reporting issuer or the equivalent in each province and territory of Canada that provides for a reporting issuer regime and is not, to the best of its knowledge, in default of any applicable requirement under the securities legislation of the Jurisdictions. SLF's head office is located in Ontario.

2. SLF's authorized capital consists of unlimited numbers of Class A Shares and Class B Shares, each issuable in series, and an unlimited number of Common Shares.

3. As of October 31, 2011 SLF had outstanding 582,791,958 Common Shares, 16,000,000 Class A Shares Series 1, 13,000,000 Class A Shares Series 2, 10,000,000 Class A Shares Series 3, 12,000,000 Class A Shares Series 4, 10,000,000 Class A Shares Series 5, 10,000,000 Class A Shares Series 6R, 11,200,000 Class A Shares Series 8R, 10,000,000 Class A Shares Series 10R and 12,000,000 Class A Shares Series 12R. SLF also had outstanding four series of senior unsecured debentures in an aggregate principal amount of $2,150,000,000 and four series of subordinated unsecured debentures in an aggregate principal amount of $1,650,000,000.

SLA

4. SLA was formed by the amalgamation of its predecessor, Sun Life Assurance Company of Canada, and Clarica Life Insurance Company on December 31, 2002 and its governing statute is the ICA. SLA is a reporting issuer or the equivalent in each province and territory of Canada that provides for a reporting issuer regime and is not, to the best of its knowledge, in default of any applicable requirement under the securities legislation of the Jurisdictions. SLA's head office is located in Ontario.

5. SLA's authorized capital consists of unlimited numbers of Class A Shares, Class B Shares, Class C Shares, Class D Shares and Class E Shares, each issuable in series, and an unlimited number of common shares.

6. As of October 31, 2011 SLA had outstanding 405,179,546 common shares, 40,000 Class B Shares -- Series A, 28,000,000 Class C Shares -- Series 1 and 14,000,000 Class C Shares -- Series 2, all of which are held by SLF. None of SLA's outstanding shares are SLA Dividend Restricted Shares or Public Preferred Shares.

7. SLA has created and authorized the issuance of up to 38,000,000 SLA Preferred Shares Series Y and 38,000,000 SLA Preferred Shares Series Z to satisfy its obligations if the Holder Exchange Right is exercised or the Automatic Exchange is triggered. SLA has created and authorized the issuance of up to 8,000,000 SLA Preferred Shares Series W and 8,000,000 SLA Preferred Shares Series X for issuance if the equivalent exchange rights are exercised or triggered with respect to the SLEECS -- Series B. The terms of these shares each provide, among other things, that they are exchangeable at the option of the holder into Common Shares of SLF in certain circumstances and after certain dates.

The Trust

8. The Trust is an open-end trust established under the laws of Ontario by The Canada Trust Company as trustee pursuant to a declaration of trust dated as of August 9, 2001. The Trust is a reporting issuer or the equivalent in each province and territory of Canada that provides for a reporting issuer regime and is not, to the best of its knowledge, in default of any applicable requirement under the securities legislation of the Jurisdictions.

9. The capital of the Trust consists of an unlimited number of units divided into one class of voting Special Trust Securities issuable in series and one class of non-voting SLEECS issuable in series.

10. As of October 31, 2011 the outstanding Trust Securities consisted of 2,000 Special Trust Securities, 950,000 SLEECS -- Series A and 200,000 SLEECS -- Series B. The outstanding Special Trust Securities are all held by SLA. The outstanding SLEECS -- Series A were issued pursuant to a public offering in October 2001 and are listed on the Toronto Stock Exchange. The outstanding SLEECS -- Series B were issued pursuant to a public offering in June 2002 and are not listed on any exchange.

11. The Trust is a special purpose issuer established solely for the purpose of offering the SLEECS in order to provide SLA (and, indirectly, SLF) with a cost-effective means of raising capital for Canadian insurance company regulatory purposes by creating and selling the Trust Securities and acquiring and holding trust assets. The trust assets consist primarily of the SLA Debentures. The Trust used the proceeds of the offerings of SLEECS to purchase the SLA Debentures. The SLA Debentures generate income for distribution to holders of the Trust Securities on a semi-annual, non-cumulative basis.

12. Each of the SLA Debentures bears interest that is distributed to holders of SLEECS -- Series A and SLEECS -- Series B, respectively, by way of payment of the Indicated Yield and any excess net income, after such distributions are made, is distributed to SLA as the holder of the Special Trust Securities.

13. Representations 14 through 23 only refer to the SLEECS -- Series A, SLA Preferred Shares Series Y, SLA Preferred Shares Series Z, the SLA A Debenture and the Series A Share Exchange Agreement because the features of the SLEECS -- Series B, SLA Preferred Shares Series W, SLA Preferred Shares Series X, the SLA B Debenture and the Series B Share Exchange Agreement are the same as those described herein except for the following:

(a) the Indicated Yield payable on the SLEECS -- Series A is $34.325 per $1,000 initial issue price, which is equivalent to an annual yield of 6.8650% and which corresponds to the interest rate payable on the SLA A Debenture, whereas the Indicated Yield payable on the SLEECS -- Series B is $35.465 per $1,000 initial issue price, which is equivalent to an annual yield of 7.093% and which corresponds to the interest rate payable on the SLA B Debenture;

(b) the dates on which various rights arise are different due to the different offering dates of the SLEECS -- Series A and the SLEECS -- Series B; and

(c) the SLEECS -- Series A may be exchanged for SLA Preferred Shares Series Y or SLA Preferred Shares Series Z in certain circumstances, whereas the SLEECS -- Series B may be exchanged for SLA Preferred Shares Series W or SLA Preferred Shares Series X in those circumstances (such SLA Preferred Shares Series W and SLA Preferred Shares Series X having the same attributes as the SLA Preferred Shares Series Y and the SLA Preferred Shares Series Z, respectively, except for the dates upon which various rights arise and the rate of dividends payable on the SLA Preferred Shares Series X as compared to that of the SLA Preferred Shares Series Z).

14. The Trust will not pay the Indicated Yield on the SLEECS -- Series A if:

(a) SLA has Public Preferred Shares outstanding and fails to declare Dividends on any of the Public Preferred Shares in accordance with their respective terms; or

(b) SLA fails to declare Dividends on its Class B Shares -- Series A,

in either case, in the Dividend Reference Period.

15. Pursuant to the Series A Share Exchange Agreement, SLF and SLA have agreed, for the benefit of the holders of SLEECS -- Series A, that if the Trust fails, on any applicable Distribution Date, to pay the Indicated Yield on the SLEECS -- Series A:

(a) SLA will not pay Dividends on the SLA Dividend Restricted Shares; or

(b) if SLA Dividend Restricted Shares are not outstanding, SLF will not pay Dividends on the SLF Dividend Restricted Shares,

in either case until a specific period of time has elapsed unless the Trust first pays such Indicated Yield (or the unpaid portion thereof) to holders of the SLEECS -- Series A.

16. Pursuant to the terms of the SLEECS -- Series A and the Series A Share Exchange Agreement, the SLEECS -- Series A:

(a) may be exchanged at the option of a holder for SLA Preferred Shares Series Z pursuant to the Holder Exchange Right; and

(b) will be automatically exchanged for SLA Preferred Shares Series Y pursuant to the Automatic Exchange.

Upon the exercise of the Holder Exchange Right or the triggering of the Automatic Exchange, the Trust will convert the corresponding principal amount of the SLA A Debenture into SLA Preferred Shares Series Y or SLA Preferred Shares Series Z, as the case may be.

17. The SLA Preferred Shares Series Y and the SLA Preferred Shares Series Z will be redeemable after certain dates, at the option of SLA and subject to regulatory approval, by the payment of a cash amount or by the delivery of Common Shares of SLF.

18. On any Distribution Date the Trust has the right, subject to regulatory approval and on not less than 30 nor more than 60 days' prior written notice, to redeem the SLEECS -- Series A at the greater of the SLEECS Redemption Price and the Early Redemption Price, if the SLEECS -- Series A are redeemed prior to the At Par Redemption Date, and at the SLEECS Redemption Price if the SLEECS -- Series A are redeemed on or after the At Par Redemption Date.

19. SLA, as the holder of the Special Trust Securities, may require the termination of the Trust, subject to regulatory approval, provided that holders of SLEECS -- Series A receive the Early Redemption Price or the SLEECS Redemption Price, as applicable.

20. Upon the occurrence of certain regulatory or tax events affecting SLA or the Trust, the Trust has an additional right, subject to regulatory approval and on not less than 30 nor more than 90 days' prior written notice, to redeem at any time all but not less than all of the SLEECS -- Series A at the Early Redemption Price if the SLEECS -- Series A are redeemed prior to the At Par Redemption Date and at the SLEECS Redemption Price if the SLEECS -- Series A are redeemed on or after the At Par Redemption Date.

21. In certain circumstances, including at a time when SLA's financial condition is deteriorating or proceedings for the winding-up of SLA have been commenced, the SLEECS -- Series A will be automatically exchanged for SLA Preferred Shares Series Y without the consent of the holders.

22. The return to holders of SLEECS is dependent on the financial condition of SLA rather than the Trust. Holders of SLEECS are ultimately concerned about the affairs and financial performance of SLA as opposed to that of the Trust.

23. The SLEECS are treated for insurance regulatory capital purposes as if they are SLA Preferred Shares and, as a result, if any circumstance arose where the solvency or financial strength of SLA was threatened, the Superintendent would be expected to move to ensure that the Automatic Exchange is triggered prior to the occurrence of any potential insolvency event at SLA.

24. On November 2, 2011, the Trust announced its intention to redeem on December 31, 2011 all $950 million of the SLEECS -- Series A.

SLF Guarantees

25. Following receipt of the 2007 Order, SLF entered into the SLF Guarantees.

26. Under the Debt Guarantee, holders of the SLA Subordinated Debentures are entitled to receive payment from SLF within 15 days of any failure by SLA to make a payment due under the SLA Subordinated Debentures.

27. SLF intends to provide a similar guarantee in respect of any non-convertible debt securities issued by SLA in the future, other than debt securities issued to and held by SLF or its Affiliates, debt securities issued to the types of entities described in section 13.4(2)(c)(iii) of NI 51-102, and debt securities issued under exemptions from the prospectus requirement in section 2.35 of NI 45-106. Such a guarantee will be described in the applicable prospectus or prospectus supplement filed by SLA in connection with a distribution of such debt securities.

28. The amount payable by SLF under the Preferred Share Guarantee is limited such that the claims of holders of the SLA Preferred Shares under the Preferred Share Guarantee, in effect, rank equally with the claims of holders of the corresponding class of SLF Preferred Shares. To accomplish this, the Preferred Share Guarantee provides that if a Triggering Event occurs, SLF will pay the Deficiency Payment to SLA in trust for the benefit of holders of SLA Preferred Shares outstanding as of the Triggering Event.

29. The Preferred Share Guarantee applies in respect of any SLA Preferred Shares outstanding from time to time, including SLA Preferred Shares issued upon a conversion of SLEECS pursuant to the Holder Exchange Right or the Automatic Exchange and the equivalent exchange rights applicable to the SLEECS -- Series B. The Preferred Share Guarantee will be described in the applicable prospectus or prospectus supplement filed by SLA in connection with any future distribution of SLA Preferred Shares.

30. The Preferred Share Guarantee ranks subordinate to any and all outstanding liabilities of SLF unless otherwise provided by the terms of the instrument creating or evidencing any such liability. However, since the Preferred Share Guarantee will be a debt obligation of SLF and, therefore, will rank ahead of the claims of holders of the SLF Preferred Shares, the calculation of the amount payable under the Preferred Share Guarantee is subject to reduction such that on the distribution of assets upon a winding-up of SLF, claims under the Preferred Share Guarantee will, in effect, rank equally with the claims of holders of the SLF Preferred Shares. Otherwise, the Preferred Share Guarantee would negatively impact the capital treatment of the SLA Preferred Shares for SLF for insurance regulatory purposes.

31. Each of the SLF Guarantees will terminate (except in respect of any demand previously made on the guarantor) upon the earlier to occur of:

(a) unless SLF and SLA agree to the contrary, the date that no SLA securities which are the subject of such guarantee (or securities convertible into or exchangeable for such securities, including, in the case of the Preferred Share Guarantee, SLEECS) are outstanding;

(b) the date that SLF no longer owns all of the outstanding common shares of SLA;

(c) the date that the relief contemplated by this decision is no longer available to SLA; and

(d) the date SLA commences filing its own Continuous Disclosure Filings with the securities regulatory authority in each province and territory in Canada,

provided that SLF may not terminate the Preferred Share Guarantee in respect of the SLA Preferred Shares Series W, the SLA Preferred Shares Series X, the SLA Preferred Shares Series Y and the SLA Preferred Shares Series Z pursuant to clauses (b), (c) or (d) above at any time after the occurrence of an Automatic Exchange or during a period when SLA has failed to make full payment when due of any dividend declared on any SLA Preferred Shares or has failed to make full payment when due of the Redemption Price and, in either case, such failure has not been remedied by the payment of such amounts by SLA or SLF.

Requested Relief

32. The requested relief is to replace the 2007 Order with this order.

33. The relief requested is substantially similar to the Credit Support Issuer Exemptions.

34. Section 13.4(2) of NI 51-102 provides an automatic exemption from the Continuous Disclosure Requirements for a Credit Support Issuer provided that certain conditions are satisfied. With the implementation of the SLF Guarantees, SLA will be able to satisfy each of the criteria of section 13.4(2) of NI 51-102 other than the requirement set out in section 13.4(2)(c) due to the terms of the Preferred Share Guarantee.

35. The Preferred Share Guarantee is structured such that, in a circumstance where SLA fails to make payment for 15 days of either declared dividends or the Redemption Price, or there exists insufficient assets to pay the Liquidation Preference upon the liquidation or winding-up of SLA, and at such time a winding-up order has been made in respect of SLF, payment of such amounts to holders of the SLA Preferred Shares will not be made until the final distribution of surplus of SLF, if any, to shareholders of SLF pursuant to section 95(1) of the WURA. This provision of the Preferred Share Guarantee is necessary in order to preserve the appropriate priority of claims (i.e., so that claims of holders of the SLA Preferred Shares under the Preferred Share Guarantee do not rank ahead of the claims of holders of SLF Preferred Shares by virtue of crystallizing earlier). In circumstances where SLF is not the subject of a winding-up order, payment will be made on the date immediately following the 15-day period permitted for the payment of dividends and the Redemption Price and, in the case of the Liquidation Preference, the later of:

(a) the date of the final distribution of property of SLA to creditors pursuant to section 93 of the WURA; and

(b) the date of the final distribution of surplus of SLA to shareholders, if any, pursuant to section 95(1) of the WURA.

36. With the implementation of the SLF Guarantees, the only outstanding securities of SLA that will not satisfy the criteria of section 13.4(2)(c) of NI 51-102 are the SLA Preferred Shares because the Preferred Share Guarantee will not be a full and unconditional guarantee as required to comply with the definition of Designated Credit Support Securities.

37. The Trust is not able to rely on section 13.4 of NI 51-102 due to the fact that the SLEECS cannot be guaranteed by SLF without adverse consequences on the capital treatment for Canadian insurance company regulatory purposes.

38. Section 4.4 of NI 52-109 provides an automatic exemption from the Certification Requirements for a Credit Support Issuer provided that it qualifies for, and is in compliance with, the requirements and conditions set out in section 13.4 of NI 51-102. For the reasons described above, neither SLA nor the Trust meet all of the conditions of section 13.4 of NI 51-102.

Liability for Secondary Market Disclosure

39. SLF has delivered to the Ontario Securities Commission the SLF Responsible Issuer Undertaking and has filed the SLF Responsible Issuer Undertaking on its SEDAR profile.

Decision

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

The decision of the principal regulator under the Legislation is that a Continuous Disclosure Exemption be granted to SLA provided that:

(a) SLF and SLA continue to be regulated by the Office of the Superintendent of Financial Institutions (Canada) or any successor;

(b) SLF remains the beneficial owner of all the outstanding voting securities (as defined in the Legislation) of SLA;

(c) SLF and SLA remain reporting issuers or the equivalent thereof under the Legislation;

(d) SLF continues to provide the Preferred Share Guarantee;

(e) SLF complies with the requirements of the Legislation and the requirements of the TSX in respect of making public disclosure of material information on a timely basis;

(f) SLF immediately issues in Canada and files any news release that discloses a material change in its affairs;

(g) SLF concurrently sends to all holders of Subordinated Debentures of SLA, in the manner and at the time required by the Legislation and the TSX, all disclosure materials that are sent to holders of similar debt of SLF;

(h) SLF concurrently sends to all holders of guaranteed SLA Preferred Shares, and to holders of SLEECS, in the manner and at the time required by the Legislation and the TSX, all disclosure materials that are sent to holders of similar SLF Preferred Shares;

(i) SLA files, for the periods covered by any annual or interim financial statements of SLF, in or with such SLF financial statements, consolidating Summary Financial Information for SLF presented with a separate column for each of the following:

(i) SLF;

(ii) SLA;

(iii) any other subsidiaries of SLF on a combined basis;

(iv) consolidating adjustments; and

(v) the total consolidated amounts;

(j) SLA immediately issues in Canada a news release and files a material change report for all material changes in respect of the affairs of SLA that are not also material changes in the affairs of SLF;

(k) SLA files the ICA Financial Statements concurrently with the filing of such financial statements with the Superintendent in compliance with section 335 of the ICA;

(l) no person or company other than SLF provides a guarantee or alternative credit support (as defined in NI 51-102) for the payments to be made under any issued and outstanding securities of SLA;

(m) SLA does not issue or have outstanding any securities other than Designated Credit Support Securities, securities issued to and held by SLF or its Affiliates, debt securities issued to the types of entities described in section 13.4(2)(c)(iii) of NI 51-102, securities issued under exemptions from the prospectus requirement in section 2.35 of NI 45-106, or SLA Preferred Shares that are subject to the Preferred Share Guarantee;

(n) SLA files a notice indicating it is relying on the Continuous Disclosure Filings of SLF and setting out where those documents can be found for viewing in electronic format; and

(o) such Continuous Disclosure Exemption will cease to apply on January 15, 2017.

The further decision of the principal regulator under the Legislation is that a Continuous Disclosure Exemption be granted to the Trust provided that:

(a) SLA qualifies for the relief contemplated by, and SLF and SLA are in compliance with the requirements and conditions set out in, SLA's Continuous Disclosure Exemption;

(b) for so long as any SLEECS are outstanding, SLF and SLA continue to provide the Dividend Stopper Undertaking;

(c) the Trust does not issue or have outstanding any securities other than SLEECS and Special Trust Securities;

(d) the Trust does not have any material assets other than the SLA Debentures and has no material liabilities other than the Credit Facilities;

(e) the Trust immediately issues in Canada a news release and files a material change report for all material changes in respect of the affairs of the Trust that are not also material changes in the affairs of SLF or SLA;

(f) all of the outstanding Special Trust Securities are beneficially owned by SLA or any of its Affiliates and all of the outstanding voting securities (as defined in the Legislation) of SLA or of its Affiliates which own the Special Trust Securities are beneficially owned by SLF;

(g) the rights and obligations, other than the economic terms thereof, of holders of any additional SLEECS that may be issued by the Trust are the same in all material respects as the rights and obligations of holders of SLEECS -- Series A and SLEECS -- Series B at the date of this decision;

(h) the Trust files a notice indicating it is relying on the Continuous Disclosure Filings of SLF and setting out where those documents can be found for viewing in electronic format; and

(i) such Continuous Disclosure Exemption will cease to apply on January 15, 2017.

The further decision of the Principal regulator under the legislation is that a Certification Exemption be granted to SLA provided that:

(a) SLA qualifies for the relief contemplated by, and SLF and SLA are in compliance with the requirements and conditions set out in, SLA's Continuous Disclosure Exemption;

(b) SLA and the Trust are not required to file, and do not file, their own Annual Filings and Interim Filings; and

(c) such Certification Exemption will cease to apply on January 15, 2017.

The further decision of the Principal regulator under the legislation that a Certification Exemption be granted to the Trust provided that:

(a) the Trust qualifies for the relief contemplated by, and SLF, SLA and the Trust are in compliance with the requirements and conditions set out in, the Trust's Continuous Disclosure Exemption;

(b) the Trust is not required to file, and does not file, its own Annual Filings and Interim Filings; and

(c) such Certification Exemption will cease to apply on January 15, 2017.

The further decision of the principal regulator is that the 2007 Order is replaced by this decision.

Lions Bay Capital Inc.

Headnote

National Policy 11-203 Process For Exemptive Relief Applications in Multiple Jurisdictions -- National Instrument 52-107 Acceptable Accounting Principles and Auditing Standards, s. 5.1 -- A reporting issuer wants to early adopt IFRS for purposes of preparing its financial statements -- The reporting issuer is completing a reverse takeover of a target; the reporting issuer has already adopted IFRS; the target's financial statements were prepared in accordance with IFRS; the target will be the resulting issuer and will file all subsequent filings in accordance with IFRS.

Applicable Legislative Provisions

National Instrument 52-107 Acceptable Accounting Principles and Auditing Standards, s. 5.1.

January 13, 2012

IN THE MATTER OF

THE SECURITIES LEGISLATION OF

BRITISH COLUMBIA AND ONTARIO

(the Jurisdictions)

AND

IN THE MATTER OF

THE PROCESS FOR EXEMPTIVE RELIEF

APPLICATIONS IN MULTIPLE JURISDICTIONS

AND

IN THE MATTER OF

LIONS BAY CAPITAL INC.

(the Filer)

DECISION

Background

1 The securities regulatory authority or regulator in each of the Jurisdictions (Decision Maker) has received an application from the Filer for a decision under the securities legislation of the Jurisdictions (the Legislation) exempting the Filer from the requirement in section 4.2 of National Instrument 52-107 Acceptable Accounting Principles and Auditing Standards (NI 52-107) that financial statements be prepared in accordance with Canadian GAAP -- Part V (the Exemption Sought), in order that the financial statements of a reverse takeover acquirer that the Filer is required to file pursuant to paragraph 4.10(2)(a)(ii) of National Instrument 51-102 Continuous Disclosure Obligations (NI 51-102) may be prepared in accordance with Canadian GAAP applicable to publicly accountable enterprises, which is IFRS incorporated into the Handbook.

Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a dual application):

(a) the British Columbia Securities Commission is the principal regulator for this application;

(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 Alberta and Saskatchewan (Passport Jurisdictions); and

(c) the decision is the decision of the principal regulator and evidences the decision of the securities regulatory authority or regulator in Ontario.

Interpretation

2 Terms defined in National Instrument 14-101 Definitions, MI 11-102 and NI 52-107 have the same meaning if used in this decision, unless otherwise defined.

Representations

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

1. the Filer is a corporation incorporated under the laws of British Columbia;

2. the head office of the Filer is located at Unit 101 -- 4705 Wayburne Drive, Burnaby, British Columbia, V5G 3L1, Canada and its registered office is located at Suite 1810 -- 1111 West Georgia Street, Vancouver, British Columbia, V6E 4M3, Canada;

3. the Filer is a reporting issuer in the Jurisdictions and the Passport Jurisdictions;

4. the Filer is not in default of securities legislation in any jurisdiction;

5. the Filer is a capital pool company and its common shares are listed on the TSX Venture Exchange (TSXV) under the symbol LBI.P;

6. the Filer is in the process of completing its Qualifying Transaction (as such term is defined in TSXV Policy 2.4 Capital Pool Companies) with the target Finsbury Exploration Ltd. (the Target);

7. the Target is a private mineral exploration company incorporated under the laws of British Columbia with certain copper-gold mineral interests in northern British Columbia known as the Gnat Pass Project;

8. upon completion of the Qualifying Transaction, the Target will become a subsidiary of the Filer and the Filer will continue to carry on its business through the Target (the Filer referred to as the Resulting Issuer upon completion of the Qualifying Transaction);

9. the Qualifying Transaction is a reverse acquisition; although for legal purposes the Filer is the acquirer, for accounting purposes the Target is the acquirer; accordingly, the consolidated financial statements of the Resulting Issuer will be those of the accounting acquirer, namely the Target;

10. the fiscal year end of the Filer is May 31 and the fiscal year end of the Target is December 31; the fiscal year end of the Resulting Issuer will change to December 31 upon completion of the Qualifying Transaction;

11. in accordance with the policies of the TSXV, the Filer must file a CPC Filing Statement (as such term is defined in TSXV Policy 2.4) with the TSXV and on SEDAR which describes the Qualifying Transaction and includes certain financial information of the Target;

12. the CPC Filing Statement will contain audited financial statements for the Target for the financial years ended December 31, 2010 and 2009 (the Filing Statement Financial Statements) and a reviewed interim financial report of the Target as at and for the three and nine months ended September 30, 2011; the Filer is seeking a waiver from the TSXV from the requirement to include in the CPC Filing Statement the Target's audited financial statements for the financial year ended December 31, 2008 (the 2008 Financial Statements);

13. the Target has been preparing its financial statements in accordance with Canadian GAAP applicable to publicly accountable enterprises, which is IFRS incorporated into the Handbook, since its incorporation; the CPC Filing Statement Financial Statements and the 2008 Financial Statements (together, the Target Financial Statements) were prepared in accordance with Canadian GAAP applicable to publicly accountable enterprises, which is IFRS incorporated into the Handbook, and were audited in such form in accordance with Canadian GAAS; all interim financial reports prepared by the Target have been prepared in accordance with the International Accounting Standard 34 Interim Financial Reporting;

14. the Canadian Accounting Standards Board adopted IFRS as Canadian GAAP for most publicly accountable enterprises for fiscal years beginning on or after January 1, 2011;

15. NI 52-107 sets out acceptable accounting principles for financial reporting under the Legislation by domestic issuers, foreign issuers, registrants and other market participants; under NI 52-107, for financial years beginning before January 1, 2011, a domestic issuer must use Canadian GAAP -- Part V, with the exception that an SEC registrant may use U.S. GAAP; under Part 4 of NI 52-107, for financial years beginning before January 1, 2011, only foreign issuers may use IFRS;

16. the current financial year of the Filer began on June 1, 2011; as required by NI 52-107, the Filer adopted Canadian GAAP applicable to publicly accountable enterprises, which is IFRS incorporated into the Handbook, for the financial year beginning June 1, 2011;

17. the Target analyzed the Target Financial Statements and advised the Filer that there would be no material differences, in recognition and measurement, if the Target Financial Statements were prepared in accordance with Canadian GAAP -- Part V; and

18. in accordance with paragraph 4.10(2)(a)(ii) of NI 51-102, upon completion of the Qualifying Transaction the Resulting Issuer is required to file the Target Financial Statements.

Decision

4 Each of the Decision Makers is satisfied that the decision meets the test set out in the Legislation for the Decision Maker to make the decision.

The decision of the Decision Makers under the Legislation is that the Exemption Sought is granted, provided that the Target Financial Statements are prepared in accordance with Canadian GAAP applicable to publicly accountable enterprises, which is IFRS incorporated into the Handbook.

Geo Minerals Ltd. -- s. 1(10)

Headnote

National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- Issuer deemed to no longer be a reporting issuer under securities legislation.

Applicable Legislative Provisions

Securities Act, R.S.O. 1990, c.S.5, as am., s. 1(10).

Citation: Geo Minerals Ltd., Re, 2012 ABASC 15

January 16, 2012

Attention: Jonathan Tkatch

Dear Sir:

The Applicant has applied to the local securities regulatory authority or regulator (the Decision Maker) in each of the Jurisdictions for a decision under the securities legislation (the Legislation) of the Jurisdictions to be deemed to have ceased to be a reporting issuer in the Jurisdictions.

As the Applicant has represented to the Decision Makers that:

(a) the outstanding securities of the Applicant, including debt securities, are beneficially owned, directly or indirectly, by fewer than 15 security holders in each of the jurisdictions in Canada and fewer than 51 security holders in total in Canada;

(b) no securities of the Applicant are traded on a marketplace as defined in National Instrument 21-101 Marketplace Operation;

(c) the Applicant is applying for a decision that it is not a reporting issuer in all of the jurisdictions in Canada in which it is currently a reporting issuer; and

(d) the Applicant is not in default of any of its obligations under the Legislation as a reporting issuer,

each of the Decision Makers is satisfied that the test contained in the Legislation that provides the Decision Maker with the jurisdiction to make the decision has been met and orders that the Applicant is deemed to have ceased to be a reporting issuer and that the Applicant's status as a reporting issuer is revoked.

Clifton Group Investment Management Company

Headnote

MI 11-102 -- relief granted from margin rate applicable to U.S. money market mutual funds in calculation of market risk in Form 31-103F1 -- margin rate for funds qualified for distribution in Canada is 5%, while funds qualified for distribution in U.S. is 100% -- similar regulation of money market funds -- NI 31-103.

Applicable Legislative Provisions

National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations, ss. 12.1, 15.

Multilateral Instrument 11-102 Passport System, s. 4.7.

January 17, 2012

IN THE MATTER OF

THE SECURITIES LEGISLATION OF

ONTARIO

(the "Principal Jurisdiction")

AND

IN THE MATTER OF

THE PROCESS FOR EXEMPTIVE RELIEF

APPLICATIONS IN MULTIPLE JURISDICTIONS

AND

IN THE MATTER OF

THE CLIFTON GROUP INVESTMENT

MANAGEMENT COMPANY

(the "Filer")

DECISION

Background

The Principal Regulator (as defined below) in the Principal Jurisdiction has received an application from the Filer for a decision under Subsection 15.1 of National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations ("NI 31-103") for relief from the requirement in section 12.1 of NI 31-103 that the Filer calculate its excess working capital using Form 31-103F1 (the "Form F1") only to the extent that the Filer be able to apply the same margin rate to investments in money market mutual funds qualified for sale by prospectus in the United States of America as is the case for money market mutual funds qualified for sale in a province of Canada when calculating market risk pursuant to Line 9 of the Form F1 (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 (the "OSC" or "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 the province of Quebec.

Interpretation

Defined terms contained in NI 31-103 and MI 11-102 have the same meanings in this decision (the "Decision") unless they are otherwise defined in this Decision.

Representations

This Decision is based on the following facts represented by the Filer.

1. The Filer is a corporation established under the laws of the State of Minnesota in the United States of America ("U.S.") with its head office located in Minneapolis, Minnesota.

2. The Filer is registered in Ontario and Quebec as an adviser in the category of portfolio manager. The Filer is also registered as an adviser under the Commodity Futures Act (Ontario).

3. The Filer is not a reporting issuer in any jurisdiction of Canada and is not in default of securities regulation in any jurisdiction of Canada.

4. The Filer was established on May 25, 1972. The Filer provides professional portfolio management for clients and manages risk-based allocation programs through the use of futures, swaps and options. More than 80% of the Filer's revenues are generated from clients based in jurisdictions other than Canada.

5. The Filer is registered with the U.S Securities and Exchange Commission as an investment adviser under the United States Investment Advisers Act of 1940, as amended (the "1940 Act").

6. The Filer invests its cash balances in money market mutual funds qualified for sale by prospectus in the U.S., specifically money market mutual funds which are registered investment companies under the 1940 Act and which comply with Rule 2a-7 thereunder ("Rule 2a-7").

7. The Filer may not be able to invest its cash balances in money market mutual funds that are qualified for sale by prospectus in a province of Canada because such mutual funds may not be qualified for sale in the U.S. nor offered by the Filer's bank, and therefore requiring that the Filer invest its cash balances in these funds would constitute a burden not justified in the circumstances.

8. The Filer has also represented that; (a) there would be foreign exchange issues and tax implications relating to the conversion of the funds; and (b) the Filer lacks familiarity with Canadian money market mutual funds.

9. Under Schedule 1 of Form F1, an investment in the securities of a money market mutual fund qualified for sale by prospectus only in the U.S. would be subject to a margin rate of 100% of the market value of such investments for the purposes of Line 9 of Form F1. With a margin rate of 100% the Filer is not able to satisfy the applicable excess working capital requirements.

10. The margin rate required for a money market mutual fund qualified for sale by prospectus in a province of Canada is 5% of the market value of such investment, as opposed to 100% for the market value of investments in a money market mutual fund qualified for sale by prospectus in the U.S.

11. The regulatory oversight and the quality of investments held by a money market mutual fund qualified for sale by prospectus in each of the U.S. and Canada is similar. In particular Rule 2a-7 sets out requirements dealing with portfolio maturity, quality, diversification and liquidity, which are similar to requirements under National Instrument 81-102 -- Mutual Funds (NI 81-102).

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 so long as:

(a) any money market mutual fund invested in by the Filer is qualified for sale by prospectus in the U.S. as a result of being a registered investment company under the 1940 Act which complies with Rule 2a-7;

(b) the requirements for money market mutual funds under Rule 2a-7 or any successor rule or legislation are similar to the requirements for Canadian money market funds under NI 81-102 or any successor rule or legislation; and

(c) the Filer is registered with the U.S. Securities and Exchange Commission as an investment adviser under the 1940 Act.

Manulife Asset Management Limited et al.

Headnote

National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- Two-tier fund structure with conversion feature -- the top fund is a closed-end fund that holds forward contract for tax efficient exposure to bottom fund -- the bottom fund is a mutual fund -- relief granted to bottom fund to short sell up to 20% of net assets subject to certain conditions.

Applicable Legislative Provisions

National Instrument 81-102 Mutual Funds, ss. 2.6(a), 2.6(c), 6.1(1), 19.1(2).

January 17, 2012

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

MANULIFE ASSET MANAGEMENT LIMITED

(the Filer), MANULIFE STRATEGIC INCOME

OPPORTUNITIES FUND (the Income Opportunities

Fund) and MANULIFE STRATEGIC INCOME TRUST

(the Strategic Fund, together with the Income

Opportunities Fund, the Funds)

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) exempting the Strategic Fund from subsections 2.6(a), 2.6(c) and 6.1(1) of National Instrument 81-102 Mutual Funds (NI 81-102) to permit the Strategic Fund, on the terms and conditions set out in this decision: (a) to sell securities short, including index participation units, as defined in NI 81-102 (IPUs), of fixed income exchange-traded funds (ETFs); (b) to provide a security interest over the Strategic Fund's assets in connection with the short sales; and (c) to deposit its assets with a dealer as security in connection with the short sales (the Requested Relief).

Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):

1. the Ontario Securities Commission is the principal regulator for this application; and

2. 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 all provinces and territories of Canada, except Ontario.

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 and the Funds:

The Filer and the Funds

1. The Filer is the manager, trustee and portfolio advisor of the Funds. The Filer is a corporation governed under the Business Corporations Act (Ontario) and has its head office located in Toronto, Ontario. The Filer is an indirect wholly-owed subsidiary of Manulife Financial Corporation (MFC).

2. The Filer is registered in the categories of portfolio manager, investment fund manager, exempt market dealer, mutual fund dealer and commodity trading manager.

3. The Filer and the Funds are not in default of securities legislation in any jurisdiction.

4. Manulife Asset Management (US) LLC (the Sub-Advisor) has been retained by the Filer to provide portfolio sub-advisory services to each of the Funds. The Sub-Advisor is also an indirect wholly-owned subsidiary of MFC.

5. The Income Opportunities Fund completed an offering of its units to the public (the Offering) pursuant to a final long form prospectus prepared in accordance with Form 41-101F2 dated May 27, 2011. The units of the Income Opportunities Fund are listed and posted for trading on the Toronto Stock Exchange.

6. The Income Opportunities Fund's investment objectives are: (a) to provide its unitholders with monthly tax-advantaged distributions; and (b) to preserve capital while providing the opportunity for long-term capital appreciation for its unitholders. The Income Opportunities Fund has been created to provide exposure, on a tax-advantaged basis, to an actively managed portfolio (the Portfolio) comprised primarily of fixed-income securities of global issuers, including corporate bonds (investment grade and high yield) and government bonds (developed and emerging markets). The Income Opportunities Fund obtains economic exposure to the Portfolio through a forward agreement (the Forward Agreement) entered into with a Canadian chartered bank (the Counterparty). The return to the Income Opportunities Fund is, by virtue of the Forward Agreement, based on the performance of the Strategic Fund, which acquired and holds the Portfolio.

7. The Income Opportunities Fund will de-list its units and convert from a closed-end investment fund into an open-end mutual fund in June of 2013 (the Conversion).

8. The Strategic Fund filed a final long form prospectus prepared in accordance with Form 41-101F2 dated May 27, 2011 to become a reporting issuer under the Securities Act (Ontario) and the Securities Act (Québec) and issued one unit to the Filer under its final long form prospectus such that the Strategic Fund is subject to NI 81-102.

9. After the closing of the Offering, the Strategic Fund issued units to the Counterparty with an aggregate value approximately equal to the net proceeds of the Offering, which proceeds the Strategic Fund used to acquire the Portfolio. Units of the Strategic Fund were issued to the Counterparty in reliance on exemptions from prospectus and registration requirements contained in securities legislation.

10. The Strategic Fund will not otherwise offer its units by way of a prospectus or otherwise.

11. Prior to the Conversion, the Income Opportunities Fund will file a simplified prospectus (SP) and annual information form (AIF) under National Instrument 81-101 Mutual Fund Distributions (NI 81-101) to qualify its units for new sales. The Strategic Fund has undertaken that, prior to Conversion, it will also file a SP and AIF under NI 81-101.

Short-Selling

12. The Filer proposes that the Strategic Fund be authorized to engage in a limited, prudent and disciplined amount of short selling. The Filer is of the view that the implementation and execution by the Strategic Fund of a controlled and limited short selling strategy could assist the Funds in seeking to achieve their investment objectives.

13. The final long form prospectuses for the Funds disclosed a description of: (i) short selling; (ii) the Strategic Fund's proposed short selling activities; (ii) the risks associated with short selling; and (iii) in the Investment Strategy section, the Strategic Fund's short selling strategy, subject to obtaining this relief, and this relief, which the Strategic Fund had applied for. Specifically, the long form prospectuses disclosed that, subject to obtaining this relief, the Strategic Fund may short sell units of fixed income ETFs, up to 20% of the Strategic Fund's net assets, to hedge (as defined in NI 81-102) interest rate risk.

14. Prior to the Strategic Fund conducting any short sales, each Fund will issue a press release indicating that the Requested Relief has been granted.

15. In order to effect a short sale, the Strategic Fund will borrow securities from either its custodian or a dealer (in either case, the Borrowing Agent), which Borrowing Agent may be acting either as principal for its own account or as agent for other lenders of securities. The Strategic Fund will be under an obligation to return the borrowed securities to the Borrowing Agent at a future date. The Strategic Fund also will be required to pay the Borrowing Agent any distributions declared on the borrowed securities, together with any securities borrowing fees. To return the borrowed securities, the Strategic Fund will purchase these same securities at a later date, with the result that the Strategic Fund will generally make a gain on the short sale if the price of the securities has declined by such date.

16. The Strategic Fund will implement the following controls when conducting a short sale:

a. securities will be sold short for cash only;

b. all short sales will be effected through market facilities through which the securities sold short are normally bought and sold, within normal trade settlement periods for the market in which the short sales are effected, and otherwise effected in accordance with market conventions governing the short sales;

c. the securities sold short will not include securities of an investment fund, unless the securities are index participation units, as defined in NI 81-102;

d. the securities sold short will not be "illiquid assets" as such term is defined in NI 81-102, and will be securities that are either:

i. listed and posted for trading on a stock exchange, and

A. the issuer of which has a market capitalization of not less than CDN $100 million, or the equivalent thereof, at the time the short sale is effected, or

B. that the Sub-Advisor has pre-arranged to borrow for the purpose of such sale; or

ii. bonds, debentures or other evidences of indebtedness of, or guaranteed by, any issuer.

e. the aggregate market value of all securities of an issuer sold short by the Strategic Fund does not exceed 5% of the net assets of the Strategic Fund on a daily marked-to-market basis;

f. the aggregate market value of all securities sold short by the Strategic Fund does not exceed 20% of the net assets of the Strategic Fund on a daily marked-to-market basis;

g. the Strategic Fund holds "cash cover" (as defined in NI 81-102) in an amount, including the Strategic Fund's assets deposited with the Borrowing Agent as security in connection with short sale transactions, that is at least 150% of the aggregate market value of all securities sold short by the Strategic Fund on a daily marked-to-market basis;

h. the Strategic Fund will deposit Strategic Fund's assets with the Borrowing Agent as collateral in connection with the short sale transaction;

i. the Strategic Fund will keep proper books and records of all short sales and the Strategic Fund's assets deposited with the Borrowing Agent as collateral; and

j. the Strategic Fund will develop and maintain written policies and procedures and risk management controls for the conduct of short sales prior to conducting any short sales.

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 Requested Relief is granted provided that:

1. the aggregate market value of all securities sold short by the Strategic Fund does not exceed 20% of the net assets of the Strategic Fund on a daily marked-to-market basis;

2. any short sale made by the Strategic Fund is subject to compliance with the investment objective of the Strategic Fund;

3. all short sales will be effected through market facilities through which the securities sold short are normally bought and sold;

4. securities will be sold short for cash only;

5. the aggregate market value of all securities of an issuer sold short by the Strategic Fund does not exceed 5% of the net assets of the Strategic Fund on a daily marked-to-market basis;

6. the Strategic Fund maintains appropriate internal controls regarding its short sales, including written policies and procedures, risk management controls and proper books and records;

7. the Strategic Fund holds "cash cover" (as defined in NI 81-102) in an amount, including the Strategic Fund's assets deposited with the Borrowing Agent as security in connection with short sale transactions, that is at least 150% of the aggregate market value of all securities sold short by the Strategic Fund on a daily marked-to-market basis;

8. no proceeds from the short sales by the Strategic Fund are used by the Strategic Fund to purchase long positions in securities other than cash cover;

9. for short sale transactions in Canada, every dealer that holds the Strategic Fund's assets as collateral in connection with short sale transactions by the Strategic Fund shall be a registered dealer in Canada and a member of a self-regulatory organization that is a participating member of the Canadian Investor Protection Fund;

10. for short sale transactions outside of Canada, every dealer that holds the Strategic Fund's assets as collateral in connection with short sale transactions by the Strategic Fund is a member of a stock exchange and, as a result, subject to a regulatory audit and has a net worth in excess of the equivalent of $50 million determined from its most recent audited financial statements that have been made public;

11. except where the Borrowing Agent is the Strategic Fund's custodian, when the Strategic Fund deposits the Strategic Fund's assets with a Borrowing Agent as security in connection with a short sale transaction, the amount of the Strategic Fund's assets deposited with the Borrowing Agent does not, when aggregated with the amount of the Strategic Fund's assets already held by the Borrowing Agent as security for outstanding short sale transactions of the Strategic Fund, exceed 10% of the net assets of the Strategic Fund, taken at market value at the time of the deposit;

12. the security interest provided by the Strategic Fund over any of its assets that is required to enable the Strategic Fund to effect short sale transactions is made in accordance with industry practice for that type of transaction and relates only to obligations arising under such short sale transactions;

13. before the Strategic Fund conducts any short sales, each Fund will include in the press release referred to in representation 14 above, the following information, which will also be included in the AIFs filed for the Funds before Conversion:

a. that there are written policies and procedures in place that set out the objectives and goals for short selling and the risk management procedures applicable to short selling;

b. who is responsible for setting and reviewing the policies and procedures referred to in the preceding paragraph, how often the policies and procedures are reviewed, and the extent and nature of the involvement of the board of directors of the Filer in the risk management process;

c. the trading limits or other controls on short selling in place and who is responsible for authorizing the trading and placing limits or other controls on the trading;

d. whether there are individuals or groups that monitor the risks independent of those who trade; and

e. whether risk measurement procedures or simulations are used to test the portfolio under stress conditions;

14. before the Strategic Fund conducts any short sales in connection with any new distribution of its units after Conversion:

(a) the SPs for the Funds disclose, a description of: (i) short selling; (ii) how the Strategic Fund intends to engage in short selling; (iii) the risks associated with short selling; and (iv) in the Investment Strategy section, the Strategic Fund's short selling strategy and this relief; and

(b) the AIFs for the Funds include the disclosure outlined in condition 13 above; and

15. the Requested Relief shall terminate upon the coming into force of any legislation or rule of the securities regulatory authorities dealing with the matters referred to in subsections 2.6(a), 2.6(c) and 6.1(1) of NI 81-102.

AlphaNorth 2010 Flow-Through Limited Partnership et al.

Headnote

NP 11-203 -- Exemptions granted to flow-through limited partnerships from the requirements in National Instrument 81-106 Investment Fund Continuous Disclosure to file an annual information form, to maintain and prepare an annual proxy voting record, to post the proxy voting record on its website, and to provide it to securityholders upon request. Flow-through limited partnerships have a short lifespan and do not have a readily available secondary market.

Applicable Legislative Provisions

National Instrument 81-106 Investment Fund Continuous Disclosure, ss. 9.2, 10.3, 10.4, 17.1.

January 17, 2012

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

ALPHANORTH 2010 FLOW-THROUGH LIMITED

PARTNERSHIP (the "2010 LP") AND ALPHANORTH

2011 FLOW-THROUGH LIMITED PARTNERSHIP

(the "2011 LP" and, collectively, the "Partnerships")

AND

ALPHANORTH ASSET MANAGEMENT

(the "Manager", together with the Partnerships,

the "Filers")

DECISION

Background

The principal regulator in the Jurisdiction has received an application from the Filers on behalf of the Partnerships and any future limited partnership managed by the Manager or its affiliates that is identical to the Partnerships in all respects which are material to this decision ("Future Partnerships", and together with the Partnerships, the "Limited Partnerships") for a decision under the securities legislation of the Jurisdiction of the principal regulator (the "Legislation") for an exemption pursuant to section 17.1 of NI 81-106 Investment Fund Continuous Disclosure ("NI 81-106") from the following disclosure requirements:

(a) to prepare and file an annual information form (the "AIF") pursuant to Section 9.2 of NI 81-106 for each financial year if the Limited Partnership has not obtained a receipt for a prospectus during the last 12 months preceding its financial year end;

(b) to maintain a proxy voting record (the "Proxy Voting Record") pursuant to Section 10.3 of NI 81-106; and

(c) to prepare the Proxy Voting Record on an annual basis for the period ending on June 30 of each year, post the Proxy Voting Record to the Limited Partnership's website no later than August 31 of each year and send the Proxy Voting Record to the limited partners of the Limited Partnership (the "Limited Partners") upon request pursuant to Section 10.4 of NI 81-106 ((a) through (c) above, collectively, 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 Filers have provided notice that Section 4.7(1) of Multilateral Instrument 11-102 Passport System ("MI 11-102") is intended to be relied upon in each of the provinces of Canada, other than the province of Québec and Ontario.

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 Filers:

1. The 2010 LP was formed pursuant to the provisions of the Limited Partnerships Act (Ontario) on December 14, 2009.

2. The 2011 LP was formed pursuant to the provisions of the Limited Partnerships Act (Ontario) on December 15, 2010.

3. AlphaNorth General Partner Inc. is the General Partner of the Partnerships (the "General Partner"). The General Partner was incorporated under the provisions of the Business Corporations Act (Ontario) on June 4, 2007.

4. The principal office of the Partnerships, the General Partner and the Manager is located at 144 Front Street West, Suite 420, Toronto, Ontario, M5J 2L7.

5. Each of the 2010 LP and the 2011 LP filed a final prospectus relating to its initial public offering in all of the provinces of Canada, other than Québec (the "Jurisdictions") on February 25, 2010 and January 31, 2011 respectively, and each became a reporting issuer in each of the Jurisdictions on those dates. It is expected that any Future Partnership will be a reporting issuer in each of the Jurisdictions.

6. The Manager is the manager of the Partnerships and it or its affiliate will be the manager of any Future Partnership established by the Manager.

7. The Partnerships were formed, and any Future Partnerships will be formed, to invest in certain common shares ("Flow-Through Shares") of companies, limited partnerships or other issuers whose principal business is mineral, oil and gas and alternative energy exploration, development and production that may incur certain start-up phase costs ("Resource Companies") pursuant to agreements ("Flow-Through Agreements") between the Limited Partnerships and the Resource Companies. Under the terms of each Flow-Through Agreement, a Limited Partnership will subscribe for Flow-Through Shares of the Resource Companies and the Resource Companies will agree to incur and renounce to the Limited Partnership, in amounts equal to the subscription price of the Flow-Through Shares, expenditures in respect of resource exploration and development that qualify as Canadian exploration expense or as Canadian development expense and that may be renounced as Canadian exploration expense to the Limited Partnership.

8. No later than December 31, 2012, the 2010 LP will be dissolved and the Limited Partners of the 2010 LP will receive their pro rata share of the net assets of the 2010 LP.

9. No later than June 30, 2013, the 2011 LP will be dissolved and the Limited Partners of the 2011 LP will receive their pro rata share of the net assets of the 2011 LP.

10. It is the current intention of the General Partner that each Limited Partnership will transfer its assets to an open-ended mutual fund in exchange for securities of such mutual fund. Upon dissolution of each Limited Partnership, the Limited Partners would receive their pro rata share of the securities of that mutual fund.

11. The Partnerships are not, and the Future Partnerships will not be, operating businesses. Rather, each Partnership is, and each Future Partnership will be, a short-term special purpose vehicle that will be dissolved within approximately two years of its formation. Based on the dissolution dates of the Partnerships noted above, and the comparable structure of Future Partnerships, each of the Limited Partnerships, while reporting issuers, pass two financial years ended December 31, but will not be in existence past the third December 31 financial year end.

12. The primary investment purpose of a Limited Partnership is not to achieve capital appreciation, although this is a secondary benefit, but rather to obtain for the Limited Partners the significant tax benefits that accrue when Resource Companies renounce resource exploration and development expenditures to the Limited Partnerships through Flow-Through Shares.

13. The units of the Limited Partnerships (the "Units") are not, and will not be, listed or quoted for trading on any stock exchange or market. The Units are not redeemable by the Limited Partners. Generally, Units are not transferred by Limited Partners, since Limited Partners must be holders of the Units on the last day of each fiscal year of that Limited Partnership in order to obtain the desired tax deduction.

14. It is, and will be, a term of the partnership agreement governing the Limited Partnerships that the manager or general partner of the particular Limited Partnership has, and will have, the authority to manage, control, administer and operate the business and affairs of the Limited Partnerships, including the authority to take all measures necessary or appropriate for the business, or ancillary thereto, and to ensure that the Limited Partnerships comply with all necessary reporting and administrative requirements.

15. Each Limited Partner has, or will be expected to have, by subscribing for Units, agreed to the irrevocable power of attorney contained in the partnership agreement and has thereby, in effect, consented to the making of this application.

16. Since its formation, the Partnerships' activities have been limited to (i) completing the issue of the Units under each of their prospectuses, (ii) investing their available funds in accordance with their investment objectives, and (iii) incurring expenses as described in their prospectuses. Any Future Partnership will be structured in a similar fashion.

17. Given the limited range of business activities to be conducted by the Limited Partnerships, the short duration of their existence and the nature of the investment of the Limited Partners, the preparation and distribution of an AIF by the Limited Partnerships would not be of any benefit to the Limited Partners and may impose a material financial burden on the Limited Partnerships.

18. Upon the occurrence of any material change to a Limited Partnership, Limited Partners would receive all relevant information from the material change reports the Limited Partnership is required to file with each of the Jurisdictions.

19. As a result of the implementation of NI 81-106, investors purchasing Units of the Partnerships were, and in the case of the Future Partnerships will be, provided a prospectus containing written policies on how the Flow-Through Shares or other securities held by the Limited Partnerships are voted (the "Proxy Voting Policies"). Investors purchasing Units of the Partnerships had, and in the case of the Future Partnerships will have, the opportunity to review the Proxy Voting Policies before deciding whether to invest in Units.

20. Generally, the Proxy Voting Policies require that the securities of companies held by a Limited Partnership be voted in a manner most consistent with the economic interests of the Limited Partners.

21. Given a Limited Partnership's short lifespan, the production of a Proxy Voting Record would provide Limited Partners with very little opportunity for recourse if they disagreed with the manner in which the Limited Partnership exercised or failed to exercise its proxy voting rights, as the Limited Partnership would likely be dissolved by the time any potential change could materialize.

22. Preparing and making available to Limited Partners a Proxy Voting Record will not be of any benefit to the Limited Partners and may impose a material financial burden on the Limited Partnerships.

23. Neither the Manager nor the Partnerships are in default of securities legislation in any Jurisdiction.

24. The Filers are of the view that the Exemption Sought is not against the public interest, is in the best interests of the Limited Partnerships and their Limited Partners and represents the business judgment of responsible persons uninfluenced by considerations other than the best interest of the Limited Partnerships and their Limited Partners.

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.

Global Consulting and Financial Services et al. -- ss. 127(1), 127(8)

IN THE MATTER OF

THE SECURITIES ACT,

R.S.O. 1990, c. S.5, AS AMENDED

AND

IN THE MATTER OF

GLOBAL CONSULTING AND FINANCIAL SERVICES,

CROWN CAPITAL MANAGEMENT CORPORATION,

CANADIAN PRIVATE AUDIT SERVICE,

EXECUTIVE ASSET MANAGEMENT,

MICHAEL CHOMICA, PETER SIKLOS (also known as

PETER KUTI), JAN CHOMICA, AND LORNE BANKS

TEMPORARY ORDER

(Subsections 127(1) and (8))

WHEREAS on November 4, 2010, the Ontario Securities Commission (the "Commission") issued a temporary cease trade order pursuant to subsections 127(1) and 127(5) of the Securities Act, R.S.O. 1990, c. S.5, as amended (the "Act") ordering that Global Consulting and Financial Services ("Global"), Crown Capital Management Corporation ("Crown"), Canadian Private Audit Service ("CPAS"), Executive Asset Management ("EAM"), Jan Chomica, Michael Chomica, Peter Kuti ("Kuti"), and Lorne Banks ("Banks") (collectively, the "Respondents"), cease trading in all securities (the "Temporary Order");

AND WHEREAS on November 4, 2010, the Commission ordered pursuant to clause 3 of subsection 127(1) of the Act, that any exemptions contained in Ontario securities law do not apply to the Respondents;

AND WHEREAS on November 4, 2010, the Commission ordered that the Temporary Order shall expire on the fifteenth day after its making unless extended by order of the Commission;

AND WHEREAS on November 9, 2010, the Commission issued a direction under subsection 126(1) of the Act freezing assets in a bank account in the name of Crown (the "Freeze Direction");

AND WHEREAS on November 4, 2010, the Commission issued a Notice of Hearing to consider, among other things, the extension of the Temporary Order, to be held on November 17, 2010 at 3:00 p.m. (the "Notice of Hearing");

AND WHEREAS the Notice of Hearing sets out that the hearing is to consider, inter alia, whether, in the opinion of the Commission, it is in the public interest, pursuant to subsections 127(7) and (8) of the Act, to extend the Temporary Order until the conclusion of the hearing, or until such further time as considered necessary by the Commission;

AND WHEREAS Staff of the Commission ("Staff") served the Respondents with copies of the Temporary Order and the Notice of Hearing, and served Crown with the Freeze Direction as evidenced by the Affidavit of Charlene Rochman, sworn on November 17, 2010, and filed with the Commission;

AND WHEREAS on November 17, 2010, Staff and counsel for Banks appeared before the Commission, and whereas Global, Crown, CPAS, EAM, and Kuti did not appear before the Commission to oppose Staff's request for the extension of the Temporary Order;

AND WHEREAS Staff had received a Direction from Jan Chomica dated November 11, 2010, in which she consented to extending the Temporary Order for at least two months;

AND WHEREAS counsel for Michael Chomica did not attend the hearing, but had advised Staff that Michael Chomica consents to (or does not oppose) an extension of the Temporary Order for at least two months;

AND WHEREAS on November 17, 2010, counsel for Banks advised the Commission that Banks consents to an extension of the Temporary Order;

AND WHEREAS the Panel considered the evidence and submissions before it;

AND WHEREAS pursuant to subsection 127(8) of the Act, the Commission ordered that the Temporary Order be extended to January 27, 2011;

AND WHEREAS the Commission further ordered that the hearing in this matter be adjourned to January 26, 2011 at 11:00 a.m., and that the parties make efforts to advise the Commission by January 3, 2011 whether they are in agreement that the hearing set for January 26, 2011 be held in writing;

AND WHEREAS by Notice of Motion dated December 16, 2010 (the "Notice of Motion"), Staff sought to amend the Temporary Order to include Peter Siklos ("Siklos") as the person using the alias "Peter Kuti", thereby making Siklos subject to the Temporary Order, and to abridge, under Rule 1.6(2) of the Commission's Rules of Procedure (2010), 33 O.S.C.B. 8017 (the "Rules"), the notice requirements for the filing and service of motion materials under to Rule 3.2 of the Rules and the requirement for a Memorandum of Fact and Law under Rule 3.6 of the Rules (the "Motion");

AND WHEREAS in support of the Motion, Staff filed the Affidavit of Wayne Vanderlaan ("Vanderlaan"), sworn December 15, 2010 (the "Vanderlaan Affidavit"), in which Vanderlaan states that there is a real Peter Kuti who, based on the information currently available to Staff, is not the "Peter Kuti" who is an alias for Siklos;

AND WHEREAS the Motion was heard on Monday, December 20, 2010, at 10:00 a.m., before a panel of the Commission (the "Motion Hearing");

AND WHEREAS the Commission, after considering the Affidavit of Service of Charlene Rochman, sworn December 17, 2010, was satisfied that Staff had served the Notice of Motion, the December 16, 2010 covering letter from Carlo Rossi, Litigation Counsel with Staff, and the Vanderlaan Affidavit on the Respondents;

AND WHEREAS counsel for Banks advised Staff that he would not be attending on the Motion and that Banks took no position with respect to it;

AND WHEREAS on December 20, 2010, Staff and counsel for Siklos attended before the Commission, and counsel for Siklos advised that Siklos consented to the Motion;

AND WHEREAS the Commission considered the Notice of Motion and the Vanderlaan Affidavit and the submissions made by Staff and counsel for Siklos at the Motion Hearing;

AND WHEREAS the Commission ordered that:

(i) pursuant to clause 2 of subsection 127(1) of the Act, Peter Siklos (also known as Peter Kuti) shall cease trading in all securities;

(ii) pursuant to clause 3 of subsection 127(1) of the Act, any exemptions contained in Ontario securities law do not apply to Peter Siklos (also known as Peter Kuti);

(iii) the title of the proceeding shall be amended accordingly;

(iv) for clarity, the Temporary Order as Amended (the "Amended Temporary Order") be extended to January 27, 2011; and

(v) for clarity, the hearing to consider the extension of the Amended Temporary Order be held on January 26, 2011, at 11:00 a.m., and the parties shall make efforts to advise the Commission by January 3, 2011 whether they are in agreement that the hearing set for January 26, 2011 be held in writing;

AND WHEREAS by way of letter dated January 25, 2011, Staff advised the Commission that it had obtained the consent of Michael Chomica, Jan Chomica, Siklos, Banks (collectively, the "Individual Respondents"), Crown and Global to extend the Amended Temporary Order;

AND WHEREAS Staff provided the Commission with the Affidavit of Charlene Rochman sworn January 24, 2011, outlining service of the Amended Temporary Order on the Respondents and the consent of the Individual Respondents, Crown and Global to the extension of the Amended Temporary Order;

AND WHEREAS the Commission ordered that the Amended Temporary Order be extended to March 9, 2011 and that the hearing be adjourned to March 8, 2011 at 10:00 a.m.;

AND WHEREAS on March 8, 2011, Staff attended before the Commission and no one attended on behalf of the Respondents;

AND WHEREAS the Commission was satisfied that Staff had undertaken reasonable efforts to serve the Respondents with notice of the hearing;

AND WHEREAS on March 8, 2011, Staff advised the Panel that Staff had been in contact with Jan Chomica and counsel representing Michael Chomica, Banks and Siklos and that Jan Chomica, Michael Chomica, Banks and Siklos were not opposing the extension of the Amended Temporary Order;

AND WHEREAS the Commission ordered that the Amended Temporary Order be extended to May 17, 2011 and that the hearing be adjourned to May 16, 2011 at 10:00 a.m.;

AND WHEREAS on May 16, 2011, Staff appeared before the Commission and no one appeared on behalf of any of the Respondents;

AND WHEREAS on May 16, 2011, Staff advised the Panel that Staff had been in contact with counsel representing Michael Chomica, Banks and Siklos and that Michael Chomica, Banks and Siklos were not opposing the extension of the Amended Temporary Order;

AND WHEREAS Staff further advised that Jan Chomica had provided her consent to the extension of the Amended Temporary Order by way of writing;

AND WHEREAS Staff provided the Commission with the Affidavit of Charlene Rochman sworn May 13, 2011 outlining Staff's efforts to serve the Respondents and the consent of the Individual Respondents, Crown and Global to the extension of the Amended Temporary Order;

AND WHEREAS the Commission ordered that the Amended Temporary Order be extended to July 18, 2011 and the hearing be adjourned to July 15, 2011 at 11:00 a.m.;

AND WHEREAS on July 15, 2011, Staff appeared before the Commission and no one appeared on behalf of any of the Respondents;

AND WHEREAS on July 15, 2011, Staff advised the Panel that Staff had been in contact with counsel representing Michael Chomica and Banks and that Michael Chomica consented to an extension of the Amended Temporary Order for 90 days and Banks was not opposing the extension;

AND WHEREAS Staff further advised that Jan Chomica had provided her consent to the extension of the Amended Temporary Order by way of writing;

AND WHEREAS Staff provided the Commission with the Affidavit of Charlene Rochman sworn July 13, 2011, outlining service on the Respondents;

AND WHEREAS the Commission ordered that the Amended Temporary Order be extended to October 12, 2011 and the hearing be adjourned to October 11, 2011 at 2:30 p.m.;

AND WHEREAS on October 11, 2011, Staff appeared before the Commission to request that the Amended Temporary Order be extended for an additional 90 days;

AND WHEREAS no one appeared on behalf of any of the Respondents;

AND WHEREAS Staff advised the Panel that Staff had been in contact with counsel representing Siklos and Banks and that Siklos consented to an extension of the Amended Temporary Order for 90 days and Banks was not opposing the extension;

AND WHEREAS Staff provided the Commission with the Affidavit of Charlene Rochman sworn October 7, 2011 outlining service on the Respondents;

AND WHEREAS the Commission ordered that the Amended Temporary Order be extended to January 12, 2012 and the hearing be adjourned to January 11, 2012 at 10:00 a.m.;

AND WHEREAS on January 11, 2012, Staff appeared before the Commission to request that the Amended Temporary Order be extended for an additional 90 days;

AND WHEREAS no one appeared on behalf of any of the Respondents other than counsel for Peter Siklos;

AND WHEREAS Michael Chomica and Jan Chomica advised Staff in writing that they consented to an extension of the Amended Temporary Order for 90 days;

AND WHEREAS counsel for Banks advised Staff that Banks does not oppose a further extension of the Amended Temporary Order for 90 days;

AND WHEREAS counsel for Siklos advised the Panel that he consented to an extension of the Amended Temporary Order for 90 days;

AND WHEREAS Staff provided the Commission with the Affidavit of Charlene Rochman affirmed January 10, 2012 outlining Staff's efforts to serve the Respondents;

AND WHEREAS the Commission is of the opinion that it is in the public interest to make this order;

IT IS ORDERED that the Amended Temporary Order is extended to April 12, 2012 and the hearing be adjourned to April 11, 2012 at 10:00 a.m., or such other date and time as set by the Office of the Secretary and agreed to by the parties.

DATED at Toronto this 11th day of January, 2012.

Portus Alternative Asset Management Inc. et al. -- ss. 127, 127.1

IN THE MATTER OF

THE SECURITIES ACT,

R.S.O. 1990, c. S.5, AS AMENDED

AND

IN THE MATTER OF

PORTUS ALTERNATIVE ASSET MANAGEMENT

INC., PORTUS ASSET MANAGEMENT INC.,

BOAZ MANOR, MICHAEL MENDELSON,

MICHAEL LABANOWICH AND JOHN OGG

ORDER

(Sections 127 and 127.1)

WHEREAS on October 5, 2005, the Ontario Securities Commission (the "Commission") issued a Notice of Hearing pursuant to sections 127 and 127.1 of the Securities Act, R.S.O. 1990 c. S.5, as amended (the "Act") accompanied by a Statement of Allegations issued by Staff of the Commission, in respect of Portus Alternative Asset Management Inc., Portus Asset Management Inc., Boaz Manor, Michael Mendelson, Michael Labanowich and John Ogg (collectively, the "Respondents");

AND WHEREAS on October 4, 2005, the Commission authorized the commencement of proceedings against Boaz Manor ("Manor") in the Ontario Court of Justice pursuant to section 122 of the Act;

AND WHEREAS on April 20, 2006, the Commission authorized the commencement of proceedings against Michael Mendelson ("Mendelson") and the laying of additional charges against Manor, in the Ontario Court of Justice, pursuant to section 122 of the Act (collectively, the "Section 122 Proceeding");

AND WHEREAS on March 31, 2006, Manor brought an application (the "Application") requesting the adjournment of the sections 127 and 127.1 proceeding (the "Administrative Proceeding") against him, pending the conclusion of the Section 122 Proceeding;

AND WHEREAS on June 16, 2006, each of the Respondents in the Administrative Proceeding consented to the adjournment requested in the Application;

AND WHEREAS on June 16, 2006, each of the Respondents in the Administrative Proceeding requested that the Commission grant an adjournment of the Administrative Proceeding against them pending the conclusion of the Section 122 Proceeding;

AND WHEREAS on June 16, 2006, Staff consented to the granting of an adjournment of the Administrative Proceeding against each of the Respondents pending the conclusion of the Section 122 Proceeding;

AND WHEREAS on June 16, 2006, the Commission ordered that the Administrative Proceeding be adjourned against each of the Respondents pending the conclusion of the Section 122 Proceeding and that Staff and the Respondents appear before the Commission within eight weeks of judgment being rendered in the Section 122 Proceeding;

AND WHEREAS on November 19, 2007, Mendelson was convicted of a charge under the Criminal Code of Canada before the Ontario Court of Justice and was sentenced to two years in jail and three years probation;

AND WHEREAS on May 25, 2011, Manor was convicted of two charges under the Criminal Code of Canada before the Superior Court of Justice (Ontario) and was sentenced to four years in jail;

AND WHEREAS the convictions registered against Manor and Mendelson under the Criminal Code of Canada were for acts related to the Administrative Proceeding and the Section 122 Proceeding;

AND WHEREAS on July 13, 2011, the Section 122 Proceeding was concluded;

AND WHEREAS on August 4, 2011, a Notice of Hearing was issued giving notice that the Administrative Proceeding would continue on August 8, 2011;

AND WHEREAS on August 8, 2011, Staff and counsel for Manor attended before the Commission and requested that the Administrative Proceeding be adjourned to October 13, 2011 at 10:00 a.m.;

AND WHEREAS on October 13, 2011, Staff and an agent for counsel for Manor attended before the Commission and requested that the Administrative Proceeding be adjourned to November 22, 2011 at 9:00 a.m.;

AND WHEREAS on November 22, 2011, Staff informed the Commission that each of the Respondents were given notice of the adjournment of the Administrative Proceeding until November 22, 2011;

AND WHEREAS on November 22, 2011, Staff, counsel for Manor, and Ogg attended before the Commission and made submissions;

AND WHEREAS on November 22, 2011, it was ordered that the Administrative Proceeding be adjourned to January 12, 2012 at 10:00 a.m. for the purposes of a pre-hearing conference;

AND WHEREAS on November 22, 2011, it was further ordered that the hearing on the merits shall commence on September 4, 2012, and shall continue on September 5, 6, 7, 10, 12, 13, 14, 19, 20, 21, 24, 26, 27, 28, and October 1, 2, 3, 4, and 5, 2012;

AND WHEREAS on January 12, 2012, Staff, counsel for the Court Appointed Receiver for Portus, counsel for Manor and counsel for Labanowich appeared before the Commission for a pre-hearing conference, and made submissions to the Commission;

AND WHEREAS the Commission is of the opinion that it is in the public interest to make this Order;

IT IS HEREBY ORDERED that the hearing is adjourned to April 25, 2012 at 10:00 a.m. for the purpose of continuing the pre-hearing conference.

DATED at Toronto this 12th day of January, 2012.

David M. O'Brien

IN THE MATTER OF

THE SECURITIES ACT,

R.S.O. 1990, c. S.5, AS AMENDED

AND

IN THE MATTER OF

DAVID M. O'BRIEN

ORDER

WHEREAS on December 8, 2010, the Secretary of the Commission issued a Notice of Hearing, pursuant to sections 37, 127 and 127.1 of the Ontario Securities Act, R.S.O. 1990, c. S.5, as amended (the "Act"), for a hearing to commence at the offices of the Commission at 20 Queen Street West, 17th Floor Hearing Room on Monday, December 20, 2010 at 10:30 a.m., or as soon thereafter as the hearing can be held;

AND WHEREAS on December 9, 2010, the Respondent was served with the Notice of Hearing and Statement of Allegations dated December 7, 2010;

AND WHEREAS the Notice of Hearing provided for the Commission to consider, among other things, whether, in the opinion of the Commission, it is in the public interest, pursuant to s. 127 of the Act, to issue temporary orders against David M. O'Brien ("O'Brien"), as follows:

(a) O'Brien shall cease trading in any securities for a prescribed period or until the conclusion of the hearing on the merits in this matter;

(b) O'Brien is prohibited from acquiring securities for a prescribed period or until the conclusion of the hearing on the merits in this matter; and

(c) Any exemptions contained in Ontario securities law do not apply to O'Brien for a prescribed period or until the conclusion of the hearing on the merits in this matter;

AND WHEREAS on December 20, 2010 Staff of the Commission and O'Brien appeared before the Commission and made submissions and O'Brien advised the Commission that he was opposed to Staff's request that temporary orders be issued against him and that he wished to cross-examine Lori Toledano, a member of Staff, on her affidavit;

AND WHEREAS on December 20, 2010, the hearing with respect to the issuance of the temporary orders was adjourned until December 23, 2010 at 12:30 p.m.;

AND WHEREAS on December 23, 2010, a hearing with respect to the issuance of the temporary orders was held and the panel of the Commission considered the affidavit of Toledano, the cross-examination of Toledano and the submissions made by Staff and O'Brien;

AND WHEREAS on December 23, 2010, the Commission issued a temporary cease trade order pursuant to s. 127 of the Act ordering that:

(a) O'Brien shall cease trading in any securities;

(b) O'Brien is prohibited from acquiring any securities; and

(c) Any exemptions contained in Ontario securities law do not apply to O'Brien;

(the "Temporary Cease Trade Order");

AND WHEREAS on December 23, 2010, the Commission ordered that the Temporary Cease Trade Order shall expire on April 1, 2011;

AND WHEREAS on December 23, 2010, the Commission ordered that Staff and O'Brien shall consult with the Secretary's Office and schedule a confidential pre-hearing conference for this matter;

AND WHEREAS a confidential pre-hearing conference was scheduled for February 24, 2011;

AND WHEREAS at the confidential pre-hearing conference on February 24, 2011, Staff of the Commission and O'Brien appeared and made submissions regarding the disclosure made by Staff, and Staff requested an extension of the Temporary Cease Trade Order;

AND WHEREAS on February 24, 2011, the Commission ordered that:

a) a hearing to extend the Temporary Cease Trade Order shall take place on March 30, 2011 at 11:30 a.m.;

b) a motion regarding disclosure shall take place on April 21, 2011 at 10:00 a.m., and in accordance with Rule 3.2 of the Rules of Procedure of the Ontario Securities Commission, O'Brien shall serve and file a motion record, including any affidavits to be relied upon, by April 11, 2011 at 4:30 p.m.; and

c) a further confidential pre-hearing conference shall take place on May 30, 2011 at 10:00 a.m;

AND WHEREAS on March 30, 2011, a hearing with respect to the extension of the Temporary Cease Trade Order was held, and the panel of the Commission considered the evidence filed and the submissions made by Staff and O'Brien;

AND WHEREAS on March 30, 2011, the Commission ordered that:

a) the Temporary Cease Trade Order shall be extended to April 26, 2011; and

b) a further hearing to extend the Temporary Cease Trade Order shall take place on April 21, 2011 at 10:00 a.m.;

AND WHEREAS on April 21, 2011, a hearing with respect to the extension of the Temporary Cease Trade Order was held, and the panel of the Commission considered the evidence filed and the submissions made by Staff and O'Brien;

AND WHEREAS on April 21, 2011, the Commission ordered that:

a) the Temporary Cease Trade Order shall be extended until the conclusion of the hearing of the merits of this matter; and

b) O'Brien may, if he wishes to do so, apply to the Commission for an order revoking or varying this Order pursuant to s. 144 of the Act;

AND WHEREAS also on April 21, 2011, O'Brien brought a motion regarding disclosure, wherein he sought an order from the Commission requiring Staff to provide him with all additional disclosure materials without requiring him to execute a further undertaking, and the panel of the Commission considered the evidence filed and the submissions made by Staff and O'Brien;

AND WHEREAS on April 21, 2011, the Commission ordered that Staff shall provide further disclosure materials to O'Brien without requiring the signing by him of an undertaking as to the confidentiality of that disclosure. The Commission further Ordered that:

1) All disclosure materials provided to Mr. O'Brien are confidential and may be used by him only for the purpose of making full answer and defence in this proceeding. The use of disclosure materials for any other purpose is strictly prohibited. All disclosure materials provided to Mr. O'Brien are subject to the strict confidentiality restrictions imposed by section 16 of the Act;

2) Mr. O'Brien is also subject to the implied undertaking that all disclosure materials provided to him are subject to the restrictions on use referred to in paragraph (1);

3) The Previous Undertaking signed by Mr. O'Brien is binding upon him and applies by its terms to all of the disclosure materials provided by Staff to Mr. O'Brien, including all disclosure materials provided by Staff to Mr. O'Brien in the future; if Mr. O'Brien wishes to challenge the validity of the Previous Undertaking he is entitled to bring a motion before the Commission to do so;

4) If Mr. O'Brien wishes to use the disclosure materials provided by Staff to him for any purpose other than as provided in paragraph (1), he must make an application to the Commission under section 17 of the Act for an order of the Commission consenting to that use;

AND WHEREAS at the confidential pre-hearing conference on May 30, 2011, Staff of the Commission and O'Brien appeared and Staff sought to set dates for a hearing on the merits, while O'Brien advised the Commission that he was opposed to Staff's request. The Commission adjourned the hearing to June 20, 2011 at 10:00 a.m., for the purpose of setting the dates for the hearing on the merits;

AND WHEREAS at the confidential pre-hearing conference on June 20, 2011, Staff of the Commission and O'Brien appeared and scheduling of the hearing on the merits was discussed and the Commission ordered that:

1. the hearing on the merits is to commence on March 12, 2012 at 10:00 a.m. at the offices of the Commission, 20 Queen St. West, 17th floor, Toronto, and shall continue on March 14, 15, 16, 19, 20, 21, 22, 23, 26, and 28, 2012, or such further or other dates as may be agreed upon by the parties and fixed by the Office of the Secretary; and

2. a further confidential pre-hearing conference shall take place on January 11, 2012 at 10:00 a.m.;

AND WHEREAS at the confidential pre-hearing conference on January 11, 2012, Staff of the Commission appeared and Counsel on behalf of O'Brien appeared, who advised the Commission that he had recently been appointed to represent O'Brien in this matter;

AND WHEREAS Counsel for O'Brien requested that the pre-hearing conference be continued in a few weeks time to permit him to address certain matters that had just been brought to his attention;

AND WHEREAS the Commission is of the opinion that it is in the public interest to make this order;

IT IS HEREBY ORDERED THAT the confidential pre-hearing conference is adjourned to January 31, 2012 at 3:30 p.m., or to such other date or time as set by the Office of the Secretary and agreed to by the parties.

DATED at Toronto this 11th day of January, 2012.

Tulloch Resources Ltd. (formerly Elkhorn Gold Mining Corporation) -- s. 144

IN THE MATTER OF

THE SECURITIES ACT,

R.S.O. 1990, c. S.5, AS AMENDED

(the "Act")

AND

IN THE MATTER OF

TULLOCH RESOURCES LTD.

(formerly ELKHORN GOLD MINING CORPORATION)

ORDER

(Section 144)

WHEREAS the securities of Tulloch Resources Ltd. (formerly Elkhorn Gold Mining Corporation) (the "Applicant") are subject to a cease trade order made by the Director dated January 11, 2002 pursuant to subsections 127(1) and 127(5) of the Act directing that all trading in the securities of the Applicant cease until the order is revoked by the Director and such order was extended by a further order made by the Director dated January 23, 2002 pursuant to subsection 127(8) of the Act (the "Ontario Cease Trade Order");

AND WHEREAS the Ontario Cease Trade Order was made on the basis that the Applicant was in default of certain filing requirements under Ontario securities law as described in the Ontario Cease Trade Order and outlined below;

AND WHEREAS the Applicant has applied to the Ontario Securities Commission (the "Commission") for an order pursuant to section 144(1) of the Act to revoke the Ontario Cease Trade Order;

AND UPON the Applicant having represented to the Commission that:

1. The Applicant is a corporation incorporated under the laws of the Province of British Columbia. On October 12, 2011, the Applicant filed articles of amendment to change its name from Elkhorn Gold Mining Corporation to Tulloch Resources Ltd. The head office of the Applicant is located at Suite 1209 -- 409 Granville Street, Vancouver, British Columbia, V6C 1T2.

2. The Applicant is a reporting issuer or the equivalent under the securities legislation of the provinces of British Columbia and Ontario (the "Reporting Jurisdictions"). The Applicant is not a reporting issuer in any other jurisdiction in Canada.

3. The Applicant's authorized share capital consists of 100,000,000 common shares (the "Common Shares") without par value of which 18,904,532 are issued and outstanding.

4. Other than the Common Shares, the Applicant has no securities (including debt securities) issued and outstanding.

5. The Applicant's Common Shares were delisted from the Toronto Stock Exchange on September 4, 2001 because the Applicant failed to maintain listing requirements. The Applicant currently has no securities listed or quoted on any market.

6. The Applicant is also subject to a cease trade order issued by the British Columbia Securities Commission on January 3, 2002 (together with the Ontario Cease Trade Order, the "Cease Trade Orders") which was issued due to the Applicant's failure to file certain financial statements for the financial year ended July 31, 2001.

7. The Ontario Cease Trade Order was issued due to the Applicant's failure to file audited annual financial statements for the year ended July 31, 2001 and unaudited interim financial statements for the three-month period ended October 31, 2001.

8. The Applicant subsequently failed to file the following disclosure documents with the Commission in accordance with the requirements of Ontario securities law:

a. annual audited financial statements for the years ended July 31, 2002 to July 31, 2010 (inclusive), as required by National instrument 51-102 -- Continuous Disclosure Obligations ("NI 51-102");

b. the management's discussion and analysis related thereto, as required by NI 51-102;

c. the certificates related thereto for the financial years ended July 31, 2004 to July 31, 2010 (inclusive), as required by National Instrument 52-109 -- Certification of Disclosure in Issuer's Annual and Interim Filings ("NI 52-109");

d. the unaudited interim financial statements for the periods ended October 31, 2001 through April 30, 2011 (inclusive), as required by NI 51-102;

e. the management's discussion and analysis related thereto, as required by NI 51-102;

f. the certificates related therefore for the financial periods ended January 31, 2004 through April 30, 2011 (inclusive), as required by NI 52-109;

g. a material change report and related press release in September 2001 in respect of the Applicant's de-listing from the Toronto Stock Exchange, as required by NI 51-102;

h. a change of status report in September 2001 in respect of the Applicant's de-listing from the Toronto Stock Exchange, as required by NI 51-102;

i. a material change report and related press release in January 2002 regarding the cease trade order issued by the British Columbia Securities Commission, as required by NI 51-102;

j. a material change report and related press release in January 2002 regarding the Ontario Cease Trade Order, as required by NI 51-102;

k. a material change report and related press release in August 2011 regarding the applications to the Commission and the British Columbia Securities Commission for revocation of the Cease Trade Orders, as required by NI 51-102;

l. a material change report and related press release in September 2011 regarding the appointment of a new director, as required by NI 51-102; and

m. a material change report and related press release in September 2011 regarding the Court Order (as defined below), as required by NI 51-102.

9. The Applicant further failed to pay participation fees for the years ended July 31, 2001 to July 31, 2010 (inclusive), as required by OSC Rule 13-502 -- Fees ("Rule 13-502").

10. Other than the Cease Trade Orders, the Applicant has not previously been subject to a cease trade order in any jurisdiction.

11. The Applicant was granted a court order under Section 229 of the Business Corporations Act (British Columbia) on July 25, 2011 to remedy certain of its prior corporate deficiencies (the "Court Order").

12. Pursuant to the terms of the Court Order, the Applicant held an extraordinary and annual meeting (the "Meeting") on October 11, 2011 at which all matters including those required to be approved in the Court Order were approved by the shareholders of the Applicant. The notice and information circular dated September 9, 2011 of the Applicant prepared in connection with the Meeting complies in all respects with securities laws and includes prospectus-level disclosure about each of the Applicant's current directors and officers.

13. Since the issuance of the Cease Trade Orders, the Applicant has filed, among other things, the following continuous disclosure documents with the Reporting Jurisdictions:

(a) on September 15, 2011, the Applicant's notice of and management information circular with respect to the Applicant's annual and extraordinary general meeting held October 11, 2011;

(b) on October 3, 2011, the Applicant's notice of change of auditor and related documents;

(c) on October 20, 2011, audited annual financial statements for the years ended July 31, 2008, 2009 and 2010, along with the corresponding management's discussion and analysis and the certificates of annual filings required by NI 52-109;

(d) on October 20, 2011, unaudited interim financial statements for the periods ended October 31, 2010, January 31, 2011 and April 30, 2011 along with the corresponding management's discussion and analysis for each such period and the certificates of interim filings required by NI 52-109;

(e) on October 27, 2011, a press release dated October 27, 2011 and on November 3, 2011, the related material change report dated November 3, 2011;

(f) on October 31, 2011, audited annual financial statements for the year ended July 31, 2011, along with the corresponding management's discussion and analysis and the certificates of annual filings required by NI 52-109; and

(g) on December 29, 2011, unaudited interim financial statements for the period ended October 31, 2011 along with the corresponding management's discussion and analysis for such period and the certificates of interim filings required by NI 52-109, and on January 5, 2012 amendments thereto.

(the "Filings")

14. The Applicant has not filed with the Commission:

(a) the audited financial statements for the years end July 31, 2001 through July 31, 2007, the corresponding management's discussion and analysis for each such year, and the corresponding certificates required by NI 52-109; and

(b) the unaudited interim financial statements for the periods ended October 31, 2001 through April 30, 2010, the corresponding management's discussion and analysis for each such period, and the corresponding certificates required by NI 52-109.

(the "Outstanding Filings").

15. Except for the failure to file the Outstanding Filings, the Applicant (i) is up-to-date with all of its other continuous disclosure obligations; (ii) is not in default of any of its obligations under the Cease Trade Orders; and (iii) is not in default of any requirements under the Act or the rules and regulations made pursuant thereto.

16. Since the issuance of the Ontario Cease Trade Order, all material changes in the Applicant's business were disclosed in a material change report filed by the Applicant on November 3, 2011.

17. Since the issuance of the Ontario Cease Trade Order, no technical report has been required to be filed by the Applicant pursuant to National Instrument 43-101 -- Standards of Disclosure for Mineral Projects.

18. The Applicant has filed all applicable forms under Rule 13-502 and paid all applicable participation and late filings fees in accordance with, as follows:

a. participation fees (including late fees) for the financial years ending July 31, 2001 to July 31, 2010 (inclusive);

b. late document fees for the late filing of (i) audited annual financial statements for the years ended July 31, 2008 to 2010 (inclusive); and (ii) unaudited interim financial statements for the periods ended October 31, 2010, January 31, 2011 and April 30, 2011; and

c. fees for the filing of the audited annual financial statements for the year ended July 31, 2011.

19. The Applicant has paid all outstanding filing fees, participation fees and late filing fees required to be paid to the British Columbia Securities Commission and has filed all forms associated with such payments.

20. Effective July 6, 2011, Steven Desmond Paquin was appointed as a director of the Applicant. Other than this appointment, the Applicant has had no changes to its directors, officers or insiders since the date of the Ontario Cease Trade Order.

21. The Applicant is not considering nor is it involved in any discussions related to, a reverse take-over, merger, amalgamation or other form of combination or transaction similar to any of the foregoing.

22. The Applicant has given the executive director of its principal regulator, the British Columbia Securities Commission ("Executive Director") a written undertaking that it will not complete any transaction that would result in a reverse take-over while the Applicant is not listed on a stock exchange recognized by a securities regulatory authority in Canada without providing advance written notice of such transaction to the Executive Director.

23. The Applicant has filed a completed a personal information form and authorization form for each director and officer of the Applicant in the form of Appendix A of NI 44-101 -- General Prospectus Requirements ("NI 44-101") or in such other form as permitted by NI 44-101.

24. The Applicant's SEDAR and SEDI profiles are current and accurate.

25. Upon the issuance of this revocation order, the Applicant will issue a news release announcing the revocation. The Applicant will concurrently file the news release and material change report on SEDAR.

AND UPON considering the application and the recommendation of the staff of the Commission;

AND UPON the Director being satisfied that it would not be prejudicial to the public interest to revoke the Ontario Cease Trade Order.

IT IS ORDERED pursuant to Section 144 of the Act that the Ontario Cease Trade Order is revoked.

DATED this January 16, 2012.

Peter Beck et al. -- s. 127

IN THE MATTER OF

THE SECURITIES ACT,

R.S.O. 1990, c. S.5, AS AMENDED

AND

IN THE MATTER OF

PETER BECK, SWIFT TRADE INC. (continued as

7722656 Canada Inc.), BIREMIS, CORP.,

OPAL STONE FINANCIAL SERVICES S.A.,

BARKA CO. LIMITED, TRIEME CORPORATION and

a limited partnership referred to as "ANGUILLA LP"

ORDER

(Section 127 of the Securities Act)

WHEREAS on March 23, 2011, the Ontario Securities Commission (the "Commission") issued a Notice of Hearing and a Statement of Allegations in this matter pursuant to sections 127 and 127.1 of the Securities Act, R.S.O. 1990, c. S.5, as amended (the "Act");

AND WHEREAS on April 13, 2011, Staff and counsel for the Respondents attended before the Commission for a first appearance on this matter, and the Commission ordered that the hearing be adjourned to Wednesday, July 20, 2011 at 10:00 a.m., for the purpose of addressing scheduling and any other procedural matters or for such other purposes as the Panel hearing the matter may determine;

AND WHEREAS on July 19, 2011, the Commission issued a Notice of Hearing setting the matter down to be heard on September 20 and 21, 2011 at 10:00 a.m. to consider whether, in the opinion of the Commission, it is in the public interest for the Commission to issue a Temporary Order pursuant to subsections 127(1) and (5) of the Act, that:

i. trading in any securities by Biremis, Corp. ("Biremis"), Opal Stone Financial Services S.A. ("Opal Stone"), and a limited partnership referred to as "Anguilla LP" ("Anguilla LP (Calm Oceans)") shall cease,

ii. trading in any securities by any agents, employees, successors or assigns of any of Biremis, Opal Stone, or Anguilla LP (Calm Oceans), through the use of order management systems technology owned by Orbixa Management Services Inc. ("Orbixa"), including computer servers used by Orbixa that are currently located at 1 Yonge Street, Toronto, Ontario (such technology referred to as the "ST Group Electronic Trading Platform") shall cease,

iii. trading in any securities by Peter Beck ("Beck"), or any companies or persons that are not individuals, of which Beck is an officer or director, or any entity that is otherwise an associate of Beck, through the use of the ST Group Electronic Trading Platform, shall cease, and

iv. any exemptions contained in Ontario securities law do not apply to any of Biremis, Opal Stone or Anguilla LP (Calm Oceans),

until the conclusion of the hearing in this matter or for such period as the OSC may order;

AND WHEREAS on July 20, 2011, Staff requested that a schedule be set for the hearing for a Temporary Order, and counsel for the Respondents requested that the matter be adjourned in order to allow for the delivery of Staff's materials and for the Respondents to review them and obtain instructions in relation to the relief being sought by Staff;

AND WHEREAS at the request of the Commission, Staff and counsel for the Respondents consulted with respect to dates for the hearing of the application for a Temporary Order and the hearing on the merits, and the Commission ordered that the hearing of the application for the Temporary Order be held on January 18, 19, 20, and 23, 2012, at the Offices of the Commission;

AND WHEREAS the Commission ordered that a confidential pre-hearing conference be held on September 1, 2011 at 11:00 a.m. to address scheduling for the hearing on the merits, and any other matters that Staff and counsel for the Respondents wished to raise;

AND WHEREAS on September 1, 2011, Staff and counsel for the Respondents appeared before the Commission for a pre-hearing conference, and the Commission ordered a timetable for the delivery of material and other interim steps in respect of the hearing for the Temporary Order, which timetable may be varied on consent of the parties or by further Order of the Commission, and further ordered a confidential pre-hearing conference be held on September 19, 2011 at 4:00 p.m. to address scheduling for the hearing on the merits, and any other matters that Staff and counsel for the Respondents wished to raise;

AND WHEREAS on September 19, 2011, Staff and counsel for the Respondents appeared before the Commission for a pre-hearing conference to make submissions with respect to the scheduling of the hearing on the merits, and the Commission ordered that the hearing on the merits is to commence on October 10, 2012 at 10:00 a.m. and shall continue on October 11, 12, 15, 16, 17, 18, 19, 22, 24, 25, 26, 29, and 30, 2012, or such further or other dates as may be agreed upon by the parties and fixed by the Office of the Secretary, or as ordered by the Commission;

AND WHEREAS Staff and counsel for the Respondents have delivered fact evidence as part of the interim steps in respect of the hearing for the Temporary Order;

AND WHEREAS the Respondents have represented in affidavit material filed with the Commission that, as of December 7, 2011, all trading-related servers located in Ontario and owned or operated by the Respondents or their affiliates that were used by the Respondents to transmit or receive orders to purchase or sell securities had been moved from Toronto, Ontario to a location outside Canada;

AND WHEREAS the Respondents have further represented in affidavit material filed with the Commission that Biremis and Opal Stone are no longer engaged in any trading activity;

AND WHEREAS the Respondents have undertaken (on terms agreed to with Staff) that individual traders retained by the Respondents and located in Ontario will only place orders to purchase or sell securities on marketplaces within or outside of Ontario on the Respondents' behalf if such orders are placed directly (or via sponsored access) with a dealer that is registered as an investment dealer under the Act;

AND WHEREAS on consent of all parties, it was agreed that the hearing for the Temporary Order shall be adjourned to May 29, 30, 31 and June 1, 2012, or such further or other dates as may be agreed upon by the parties and fixed by the Office of the Secretary, or as ordered by the Commission;

AND WHEREAS the Commission is of the opinion that it is in the public interest to make this order;

IT IS HEREBY ORDERED, on consent of all parties, that the hearing for the Temporary Order shall be adjourned from January 18, 2012 to May 29, 30, 31 and June 1, 2012, or such further or other dates as may be agreed upon by the parties and fixed by the Office of the Secretary, or as ordered by the Commission.

DATED at Toronto this 18th day of January, 2012.

Chapter 3 -- Reasons: Decisions, Orders and Rulings

Blueport Capital Corp. and John Hare -- s. 31

IN THE MATTER OF

STAFF'S RECOMMENDATIONS TO SUSPEND THE REGISTRATIONS OF

BLUEPORT CAPITAL CORP. AND JOHN HARE

OPPORTUNITIES TO BE HEARD BY THE DIRECTOR

UNDER SECTION 31 OF THE SECURITIES ACT

Director's decisions

1. My decision is that the registration of each of Blueport Capital Corp. (formerly Right Side Capital Corporation) (Blueport) and John Hare (collectively, the Applicants) is suspended effective December 13, 2011. My decision is based on the:

a. verbal arguments of Mark Skuce, Legal Counsel, Compliance and Registrant Regulation Branch, for Staff of the Ontario Securities Commission (OSC), and Hare, on behalf of himself and Blueport, and

b. evidence provided at the opportunity to be heard (OTBH).

Registration history of Blueport and Hare

2. Blueport was initially registered as a limited market dealer in early 2009. By operation of law, Blueport became registered as an exempt market dealer (EMD) in September 2009.

3. Hare is the Chief Compliance Officer (CCO), Ultimate Designated Person (UDP), a dealing representative, and currently the 80% shareholder of Blueport.

Suspension letter to Blueport and Hare

4. By letter dated October 19, 2011, Staff advised the Applicants that it had recommended to the Director that Blueport's registration as an EMD and Hare's registration as UDP, CCO, and as a dealing representative of Blueport be suspended. Pursuant to section 31 of the Securities Act (Ontario) (Act), Blueport and Hare are entitled to an OTBH before a decision is made by me, as Director. The joint OTBH occurred on December 13, 2011.

Bases for Staff's recommendations to suspend Hare's and Blueport's registrations

5. Staff's recommendations were based on six bases -- numerous significant deficiencies identified during a compliance field review of Blueport, inappropriate uses of investor proceeds, significant negative excess working capital, no collection of know your client (KYC) information, trades with clients who are not accredited investors, and conducting registerable activity without registration. Staff submits that these bases establish a pattern of non-compliance with Ontario securities law by Blueport and Hare. Each of these bases is described below.

Numerous significant deficiencies identified during a compliance field review of Blueport

6. Staff performed a compliance field review of Blueport which covered the period from January 20, 2009 to December 31, 2010. The numerous significant deficiencies (Alleged Significant Deficiencies) identified were set out in a letter dated October 17, 2011 to Hare and Blueport. Many of these Alleged Significant Deficiencies are linked to other bases for Staff's recommendations discussed in these reasons. Some of the Alleged Significant Deficiencies were:

a. Inadequate compliance system and CCO and UDP not adequately performing responsibilities

b. Inappropriate uses of client funds

c. Negative excess working capital

d. No collection and documentation of KYC information

e. Improper trades with clients who are not accredited investors

f. Individuals trading without registration

g. Books and records not readily available, and

h. Incomplete books and records.

Inappropriate uses of investor proceeds

7. Staff alleges that of the $262,000 raised by Right Side Generational Wealth Limited Partnership 1 (LP) (a real estate issuer related to Blueport), $17,562 was paid to Right Side Realty Corporation (RSRC), $60,000 was paid to Knightscrest Capital Corp. (Knightscrest), and $20,000 was paid to "FS". Staff alleges that these uses of investor proceeds were not disclosed in the offering memorandum for the LP and were not consistent with the intended uses of investor proceeds disclosed in that document.

8. RSRC is a related company, also owned by Hare. The payment of $17,562 was described as being an overpayment resulting from an accounting error. However, rather than correcting the overpayment (and making the LP "whole"), the decision was made to net this amount off against possible future payments by the LP to RSRC. This, in my view, was not appropriate.

9. The agreement dated October 7, 2009 entered into between Blueport and Knightscrest (and signed by Hare on behalf of Blueport) was "to create and implement a referral campaign focusing on introducing [Blueport] to [a] target group of potential investors". The agreement resulted in payment by the LP to Knightscrest in the amount of $60,000. Few, if any, services were provided under this agreement. And, all of the investors in the LP invested before this agreement was signed. In my view these expenses, even if appropriate expenses for the LP, should have been paid by Blueport and not the LP.

10. $20,000 was paid by the LP to FS as repayment for a personal loan from a former 50% shareholder of Blueport. Hare signed the promissory note on behalf of the LP. The promissory note is not collectable (because the debtor is bankrupt). In my view, the repayment of a promissory note of a former owner of a registrant is not an expense that should have been paid by the LP.

Significant negative excess working capital

11. Staff alleges that Blueport's excess working capital was less than zero in October and November 2010. Blueport did not notify Staff of this capital deficiency until March 2011. Following the period covered by the compliance review, Staff alleges that Blueport was again deficient in its excess working capital in January, February, March, and April 2011, but did not report any of these deficiencies to Staff until June 6, 2011.

12. At the OTBH I was advised (and this was confirmed by Hare) that the working capital deficiency was significant and currently in excess of $100,000, primarily due to large, uncollectable, related party accounts receivable. Mr. Hare advised Staff (through counsel) that the inter-company accounts receivable "could be convertible into cash within three months based on [Hare's] understanding of the business activities of the other companies". However, on direct questioning by me at the OTBH, Hare confirmed that these related companies -- one of which is owned by him (RSRC) -- currently are not operating and therefore the inter-company accounts receivable will not be convertible into cash within three months as he previously advised Staff. Nor was Hare able to advise me when these inter-company accounts receivable might reasonably be converted into cash. These conflicting responses by Hare raised serious credibility and integrity concerns in my mind regarding Hare.

No collection of KYC information

13. Staff alleges that KYC information was not collected for four of the eight (non-related) Blueport clients in the LP -- "MH", "LK", "TP", and "JS". Although Hare questioned (for various reasons) during the OTBH whether he was required to collect KYC information for these clients, I was provided with a written confirmation from Hare dated September 30, 2008 to the OSC where he acknowledged that he had read OSC Staff Notice 11-758 -- Review of Limited Market Dealers and that the "Firm will address the issues raised in the Notice where applicable". The notice clearly sets out that it "is the dealer's obligation to collect and document KYC information and assess the suitability of client trades".

Trades with clients who are not accredited investors

14. Staff alleges that, contrary to section 53(1) of the Act, securities were distributed to the following Blueport clients without a prospectus and under circumstances where no exemption from the prospectus requirements was available -"PH", TP, JS, and a numbered company. In some cases, no KYC was collected. In other cases, the KYC information provided places great doubt on how these clients could possibly be accredited investors.

Conducting registerable activity without registration

15. Staff alleges that the KYC form for PH and the numbered company were completed (and dated) before Blueport obtained registration as an EMD in Ontario. Staff provided the signed KYC forms during the OTBH clearly evidencing that Blueport, Hare and the other original 50% shareholder of Blueport were conducting registerable activity prior to being registered.

Summary of Staff's arguments

16. Staff argued that in light of the allegations contained in the six bases identified above, Hare and Blueport should be suspended. Staff argued that Hare did not adequately perform his responsibilities as CCO, UDP, and as a dealing representative of Blueport, and that Blueport does not have an adequate compliance system in place. As a result, Staff has fundamental concerns with regard to the integrity and proficiency of Hare and the integrity, proficiency and solvency of Blueport. As well, the allegations contained in the six bases call into question whether Blueport's operations are being conducted with the requisite integrity, proficiency and solvency of securities professionals.

17. Staff also argued that section 28 of the Act permits me, as Director, to suspend the registration of each of the Applicants on the basis that the each of the Applicants is not suitable for registration, has failed to comply with Ontario securities law or that each of their registrations is otherwise objectionable.

Decisions on the suspensions of the Applicants

18. My decision is to suspend the registration of Blueport and Hare as of December 13, 2011. My decision was communicated verbally to Hare, both in his own capacity and in his capacity as CCO, UDP, dealing representative and shareholder of Blueport, at the OTBH on December 13, 2011.

19. My decision was made as a result of the allegations outlined in the six bases above -- all of which were proven by Staff during the OTBH. In my view, Blueport's and Hare's conduct clearly demonstrates a pattern of non-compliance with Ontario securities law. As I said in Carter Securities Inc., Re (2010), 33 OSCB 8691:

"In conclusion, in my view the evidence in this case supports my decision that Carter's registration should be suspended. I concur with staff's assessment that Carter has engaged in a pattern of conduct -- through its individual registrants -- that demonstrates that it lacks the integrity required of registered firms under the Act."

20. Blueport has had a very significant (and ongoing) capital deficiency for some time -- most of which resulted from the significant and largely uncollectable accounts receivable on Blueport's balance sheet. I was also very concerned about the only proposal discussed at the OTBH to rectify this significant capital deficiency which was a large infusion of cash from Blueport's current 20% minority shareholder. I was advised that this shareholder knows little -- if anything -- about Blueport's significant and ongoing capital deficiency and other ongoing issues. It was for this reason primarily that I decided to immediately suspend the registration of Blueport and Hare.

21. I was also very concerned about the improper uses of investor proceeds as outlined above under "Inappropriate uses of investor proceeds" and the apparent registerable activity carried on by Hare prior to his and Blueport's registration. In my view, this conduct clearly demonstrates that both Blueport and Hare are unsuitable for registration and that their ongoing registrations would be objectionable. On this basis alone, my decision would have been to suspend the registrations of both Blueport and Hare.

22. I also want to comment on Hare's responses to a number of detailed questions by me. I was surprised that Hare was not able to -- or did not respond completely to -- some of my questions which should have been relatively easy to respond to if Hare was actually fulfilling his responsibilities as CCO and UDP of Blueport. For example, I asked him how he became aware of Knightcrest and about the significant dollar value of services that Blueport purchased from them. Hare's response was "honestly I can't remember". The responses to these questions, together with the responses to the capital deficiency questions described above, raised serious concerns in my mind regarding Hare's credibility and integrity.

23. Lastly, although no submissions on the "terms" of the suspensions of Blueport or Hare were made at the OTBH, in my view both suspensions should be permanent. Very serious -- and proven -- allegations were made by Staff during the OTBH. In my view, the nature of these allegations, and the seriousness of the allegations, leads me to conclude that neither Blueport nor Hare should be permitted to again be a registrant under Ontario securities law.

January 12, 2012

Chapter 4 -- Cease Trading Orders

Temporary, Permanent & Rescinding Issuer Cease Trading Orders

Temporary, Permanent & Rescinding Management Cease Trading Orders

THERE ARE NO ITEMS FOR THIS WEEK.

Outstanding Management & Insider Cease Trading Orders

Chapter 8 -- Notice of Exempt Financings

Reports of Trades Submitted on Forms 45-106F1 and 45-501F1