Ontario Securities Commission Bulletin

Issue 31/22 - May 30, 2008

Ont. Sec. Bull. Issue 31/22

Table of Contents

Chapter 1 - Notices / News Releases

Notices

• Current Proceedings Before The Ontario Securities Commission

• OSC Notice 51-714 (Revised) - OSC Continuous Disclosure Advisory Committee

• OSC Staff Notice 81-709 Report on Staff's Continuous Disclosure Review of Investment Funds (2008)

Notices of Hearing

• Borealis International Inc. et al. - ss. 127, 127.1

Notices from the Office of the Secretary

• David Berry

• Sulja Bros. Building Supplies, Ltd. (Nevada) et al.

• XI Biofuels Inc. et al.

• Borealis International Inc. et al.

• Adrian Samuel Leemhuis et al.

• Borealis International Inc. et al.

Chapter 2 - Decisions, Orders and Rulings

Decisions

• Bioscrypt Inc.

• FrontierAlt 2007 Energy & Precious Metals Flow Through LP et al.

• Aim Funds Management Inc. et al.

• Templeton International Stock Fund - MRRS Decision

• University of Western Ontario - MRRS Decision

• AldeaVision Solutions Inc.

• Pan African Mining Corp.

• Desjardins Global Asset Management Inc. - MRRS Decision

• Jones Heward Investment Counsel Inc. et al. - MRRS Decision

Orders

• Banc of America Securities LLC et al. - s. 147 of the Act and s. 6.1 of Rule 13-502 Fees

• Sulja Bros. Building Supplies, Ltd. (Nevada) et al.

• AldeaVision Solutions Inc. - s. 144

• XI Biofuels Inc. et al. - s. 127

• Adrian Samuel Leemhuis et al.

• Ampal-American Israel Corporation - s. 144

• Borealis International Inc. et al. - ss. 127(1), 127(5) and 127(7)

Chapter 3 - Reasons: Decisions, Orders and Rulings

OSC Decisions, Orders and Rulings

• David Berry - s. 21.7

• GMP Investment Management L.P. - s. 26(3)

• Claymore Investments, Inc. - s. 26(3)

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 - SRO Notices and Disciplinary Proceedings

• Recognition of the Investment Industry Regulatory Organization of Canada (IIROC) - Notice of Approval

• RS Disciplinary Notice - Kevin Moorhead

• Request for Comments -- Elimination of the Indicative Calculated Closing Price Feature on the Market on Close Facility

• MFDA - Proposed Amendments to MFDA Rule 1.1.6 (Introducing and Carrying Arrangement)

• MFDA Issues Notice of Hearing Regarding Leo Alexander O'Brien and David Baxter Snow

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Chapter 1 -- Notices / News Releases

Current Proceedings Before The Ontario Securities Commission

MAY 30, 2008

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

Andrew Keith Lech

S. B. McLaughlin

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

Portus Alternative Asset Management Inc., Portus Asset Management Inc., Boaz Manor, Michael Mendelson, Michael Labanowich and John Ogg

Maitland Capital Ltd., Allen Grossman, Hanouch Ulfan, Leonard Waddingham, Ron Garner, Gord Valde, Marianne Hyacinthe, Diana Cassidy, Ron Catone, Steven Lanys, Roger McKenzie, Tom Mezinski, William Rouse and Jason Snow

Euston Capital Corporation and George Schwartz

Al-Tar Energy Corp., Alberta Energy Corp., Eric O'Brien, Bill Daniels, Bill Jakes, John Andrews, Julian Sylvester, Michael N. Whale, James S. Lushington, Ian W. Small, Tim Burton and Jim Hennesy

Global Partners Capital, WS Net Solution, Inc., Hau Wai Cheung, Christine Pan, Gurdip Singh Gahunia

Land Banc of Canada Inc., LBC Midland I Corporation, Fresno Securities Inc., Richard Jason Dolan, Marco Lorenti and Stephen Zeff Freedman

OSC Notice 51-714 (Revised) - OSC Continuous Disclosure Advisory Committee

ONTARIO SECURITIES COMMISSION

NOTICE 51-714 (REVISED)

(Previously published May 26, 2006)

OSC CONTINUOUS DISCLOSURE

ADVISORY COMMITTEE

The Ontario Securities Commission (OSC) is inviting new applications for membership on its Continuous Disclosure Advisory Committee (CDAC).

The Commission recognizes the critical importance of consulting with industry participants and other stakeholders in carrying out its mandate. The CDAC, established in 2002, advises staff on a range of matters including the planning, implementation and communication of its review program, and policy- and rule-making initiatives. The CDAC also serves as a forum to make staff aware of emerging issues and to critically assess its procedures.

The CDAC is made up of approximately fifteen individual members. The CDAC generally meets five times a year and members serve two-year terms. Members are expected to have extensive knowledge of continuous disclosure issues and a strong interest in securities regulatory policy as it relates to these issues. The CDAC is chaired by a Commission staff representative. The current chair is Kelly Gorman.

Representatives of reporting issuers, industry associations, advisors, investing organizations and any other interested persons are invited to apply in writing for membership on the CDAC indicating their areas of practice and relevant experience. Interested parties should submit their application by June 30, 2008.

Applications and any queries regarding CDAC may be forwarded to:

May 30, 2008

OSC Staff Notice 81-709 Report on Staff's Continuous Disclosure Review of Investment Funds (2008)

ONTARIO SECURITIES COMMISSION STAFF NOTICE 81-709

REPORT ON STAFF'S CONTINUOUS DISCLOSURE REVIEW OF INVESTMENT FUNDS (2008)

1. -- Purpose

This notice summarizes the findings and comments as at March 31, 2008, arising from the Continuous Disclosure Review Program conducted by the Investment Funds Branch (the Branch) of the Ontario Securities Commission (OSC).

Continuous disclosure review has been an important element of our approach to securities regulation and aims to improve disclosure available to investors. In 2003, the Branch set out a framework for the continuous disclosure review of investment funds in OSC Staff Notice 81-705 Implementation of a Continuous Disclosure Review Program for Investment Funds -- Investment Funds Branch (Staff Notice 81-705). The purpose of that notice was to communicate general features of the Continuous Disclosure Review Program.

Following the publication of Staff Notice 81-705, the Branch developed continuous disclosure rules specific to investment funds. The result was National Instrument 81-106 Investment Fund Continuous Disclosure (NI 81-106) which came into force on June 1, 2005. Subsequently, we conducted an issue-oriented review of general compliance with NI 81-106. This notice focuses on issues identified in the course of the review, aiming to assist preparers of financial statements and management reports of fund performance (MRFP) in improving their future continuous disclosure.

2. -- Scope of Review

NI 81-106 sets out the requirements for:

• financial statements and MRFPs;

• quarterly portfolio disclosure;

• annual information forms (for funds not subject to National Instrument 81-101 Mutual Fund Prospectus Disclosure); and

• proxy voting records.

Our review focused on these requirements and the investment fund's public disclosure record including the fund manager's website and all prescribed regulatory filings on SEDAR. Our review predominantly covered financial year-ends in 2005 and 2006, but also captured some periods ending in 2007.

We reviewed a sample of investment funds and sent comment letters to fund managers who, in aggregate, manage approximately 45% of the industry's assets under management. We focused on conventional mutual funds because they are the investment vehicle of choice for most Canadian investors. Although our findings are mainly based on the review of disclosure of conventional mutual funds, other investment funds such as closed-end and exchange traded funds will also benefit from this notice, and its guidance can be applied to their continuous disclosure.

3. -- Executive Summary

We noted the following areas for improvement which are discussed in more detail in the body of the notice.

Quality of the discussion

• Results of operations. Management's discussion of the investment fund's activities in the results of operations section should be more thorough and analyze and explain the nature of and reasons for changes in the fund.

• Broad-based index. Discussion of the relative performance of the investment fund as compared to a broad-based securities market index is required and cannot be replaced by a comparison to a narrow index or blended benchmark.

• Discussion of relative performance. A more thorough discussion of why the investment fund under- or over-performed the index should be provided.

Overall presentation

• Plain language. MRFPs should be written in plain language and avoid the use of jargon and technical language.

• Investment subgroups. Management should review the investment portfolio to determine if the most appropriate categories have been used when disclosing the summary of investment portfolio in the MRFP or quarterly portfolio disclosure, and whether the breakdown conveys the nature of the fund to readers.

• Analytical review of financial statements. Management should perform an analytical review of the financial statements to ensure that all significant changes have been explained in the results of operations.

• Financial statement notes presentation. Notes to the financial statements are part of continuous disclosure and should not be convoluted with inapplicable information.

Regulatory compliance

• Commissions to related parties. Unless exemptive relief has been obtained, a monthly report must be filed when a fund pays a fee to a related company on a purchase or sale of portfolio securities.

• Financial highlights tables. The format specified in Form 81-106F1 (the Form) for financial highlights and past performance is mandated.

• Annual compound returns. Certain information must be discussed including the performance of all series and changes in an index from the prior period. Discussion of past performance should be limited to the standard performance periods.

• Mandatory notes to financial statements. Certain information must be disclosed in the notes to the financial statements to provide consistent and comparable financial statements.

4. -- Quality of the Discussion

4.1 -- Results of Operations

The summary of results of operations in the MRFP is an area that requires more attention. The intent of the summary is to put the financial statements into words and provide context for the financial results. Part B, subsection 2.3(1) of the Form requires that the results of operations include a discussion of changes to an investment fund. The list in subsection 2.3(1) addresses changes in portfolio assets, revenue and expenses, and redemptions or sales which correspond to data in the financial statements and can be found specifically in the statement of net assets, statement of investment portfolio, statement of operations, and statement of changes in net assets. The list also covers changes to the economy and markets, and requires that these factors be related back to changes in the composition of the investment portfolio.

In our review, we found that approximately 40% of investment funds selected had financial statements that revealed significant changes in the fund which were not discussed in the results of operations section of the MRFP. Examples of significant changes over the prior year included: an increase in redemptions by 81%; custodian fees that tripled; and an 11% increase in the holdings of a specific sector. In response to our comment letters, fund managers were able to address our questions with comprehensive and insightful explanations. Most fund managers stated that they did not include such explanations because they did not believe that the information fell within the requirements of subsection 2.3(1), or the discussion was not warranted because it did not add useful information pertaining to the investor's investment.

While discussion and analysis of every financial statement item may not be warranted, we expect that the results of operations will focus on significant changes in the fund over the financial period and discuss the reasons for the changes. We remind preparers to review the list of items in subsection 2.3(1). Generally, these items are material and must be discussed in the summary of the results of operations, as applicable.

We also found that 25% of investment funds disclosed significant changes but provided very little explanation or analysis. For example, we expect a fund to discuss why expenses increased, rather than simply stating that expenses were higher. As explained in the Form, the management discussion of fund performance (which includes the results of operations) "provides the manager of an investment fund with the opportunity to discuss the investment fund's position and financial results for the relevant period. The discussion is intended to give a reader the ability to look at the investment fund through the eyes of management by providing both a historical and prospective analysis of the investment activities and operations of the investment fund. Coupled with the financial highlights, this information should enable readers to better assess the investment fund's performance and future prospects." In response to our comment letters, investment funds provided us with disclosure that should have been included in the results of operations. We expect such information to be discussed in the MRFP, enabling readers to look through the eyes of management.

4.2 -- Annual Compound Returns

(a) Broad-based securities market index

Approximately 65% of fund managers did not compare the relative performance of an investment fund to a broad-based securities market index. We remind preparers that the discussion of the relative performance of an investment fund as compared to a broad-based securities market index is a requirement under Part B, subsection 4.3(3) of the Form. Please note that instruction (3) to section 4.3 states that a narrowly-based securities index or a blended index may be used in addition to a broad-based securities market index. Neither a narrowly-based index or a blended index can be a substitute for the broad-based index.

Some investment funds only provided a discussion of the fund's performance relative to a narrowly-based securities index. One fund manager explained this decision by citing concerns that the comparison of an investment fund's performance to a broad-based index would not be fully appreciated by investors. We believe that investors are more likely to understand the broad-based index as it is more widely recognized than a narrow index. A comparison to the broad-based index will help readers understand the fund's performance relative to the movement of the market more generally. In the MRFP, a fund manager has the opportunity to explain variances between the fund's performance and the general market, which may be caused by factors such as different sector exposure, and there is always the option of expanding the discussion by adding a comparison to a narrowly-based index.

(b) Discussion of relative performance

Some investment funds should have provided a more thorough discussion of the relative performance of the investment fund as compared to the appropriate index. This issue was raised with 75% of fund managers. We do not believe simply stating that the fund under- or over-performed relative to the index is a suitable discussion. Instead, we expect an explanation as to why the fund under- or over-performed relative to the index.

Often, we saw disclosure that a fund's performance was due to over- and under-weight portfolio allocations. Investment funds should consider using percentages and quantitative measures when discussing over- and under-weight portfolio allocations; otherwise, based on the disclosure provided, the reader has no sense of the magnitude of the over- or under-weight positions in various industry sectors or countries.

(c) Discussion of past performance

While we have not taken issue with the discussion of an investment fund's performance relative to an index appearing in the results of operations section rather than the annual compound returns section of the MRFP, we remind preparers that all rules relating to past performance in Part B, item 4 of the Form must still be applied. In one example, the results of operations discussed the performance of a narrow index which was not disclosed in the annual compound returns table. If a discussion of past performance is included elsewhere in the MRFP, all rules governing the disclosure of past performance still apply, such as providing disclosure only for standard performance periods.

5. -- Overall Presentation

5.1 -- Plain Language

We remind investment funds of the requirement to use plain language, which is stated in the beginning of the Form. We noted the use of jargon and technical language in the management discussion of fund performance. Some examples include:

• "off-index allocations"

• "duration positioning"

• "fundamental bottom-up strategy with a top down country overlay".

We believe that plain language will help investors understand an investment fund's disclosure documents so that they can make informed investment decisions. We strongly encourage investment funds to communicate as simply and directly as possible.

5.2 -- Summary of Investment Portfolio

In our view, 17% of investment funds did not break down their investment portfolio into appropriate subgroups in the summary of investment portfolio, as required by Part B, paragraph 5(2)(a) of the Form. The instructions in this section state that an investment fund should use the most appropriate categories given the nature of the fund. An investment fund may use more than one breakdown, such as by security type, industry, or geographical locations, so as to provide the most meaningful information.

We reviewed a precious metals fund with the majority of its assets invested in Canada that provided a geographic breakdown of the investment portfolio. A breakdown by precious metals and precious metals activities would have been more meaningful given the nature of the fund, as opposed to a breakdown by geography.

We also raised a comment if we felt that one subgroup was too generic and obvious. For example, we saw over 40% of one fund classified as "Other" and 75% of another fund labelled as "Income Funds". In such cases, we do not believe that the disclosure is meaningful nor does it provide the reader with additional information.

5.3 -- Analytical Review

As discussed earlier in this notice, the management discussion of fund performance is an analysis and explanation designed to complement and supplement an investment fund's financial statements. Management should perform an analytical review of the financial statements to ensure that the management discussion of fund performance is complete and explains the significant changes of the fund or any unusual events. In our review of financial statements, we found significant changes that were not addressed in management's discussion. By performing an analytical review, it is likely that most items required to be discussed in the results of operations (Part B, subsection 2.3(1) of the Form) are identified.

5.4 -- Financial Statement Notes Presentation

For two fund managers, certain notes to the financial statements were unrelated to the investment funds included in the bound document. One set of notes had been prepared for all the funds managed by the fund manager, but the financial statements were bound in different sets. As a result, some information in the notes related to investment funds that were not included in the particular set of financial statements. For example, the notes contained information on management fee changes, performance and incentive fees, and fund windups for individual funds regardless of whether those funds were included in that set of financial statements.

Inclusion of notes that do not relate to investment funds in the document is confusing. While subsection 7.1(2) of NI 81-106 allows notes to the financial statements to be combined when financial statements of investment funds are bound together in a document, in our view, notes should only be included if they actually relate to the investment funds in the document. Notes to the financial statements are part of continuous disclosure and should not be convoluted. We do not believe that it is appropriate to create one set of notes for the whole fund complex that is then attached to every set of financial statements without being modified for relevance. We remind preparers to review all notes to determine those relevant to the investment funds in the document.

5.5 -- Websites

We found that approximately 40% of fund managers did not provide easily accessible links to continuous disclosure documents on their websites. In one example, a link to the fund prospectus was available on the fund manager's website but not given much prominence. In another example, the financial statements, MRFPs, proxy voting records, and quarterly portfolio disclosure were not easily accessible from the fund's webpage as they were posted under a menu option that did not seem to relate to these documents. We also found that in some cases excessive drilling down was required to reach documents. In these situations, we raised comments asking that the fund manager consider adding more intuitive links to the fund's disclosure documents on their website.

Since NI 81-106 removed mandatory delivery of continuous disclosure documents to all unitholders, access to these documents by alternative methods should be made as simple as possible. Unitholders may not wish to receive paper copies of financial statements and MRFPs in the mail because they are opting to find this information online. In our view, funds should ensure that their websites are organized in a way that makes this information relatively easy to find (and is in keeping with the spirit of section 5.5 of NI 81-106).

5.6 -- SEDAR Filings

Each MRFP should be filed on SEDAR only under the individual investment fund to which it pertains (and not under a group profile) as stated in item E-2 of CSA Staff Notice 81-315 Frequently Asked Questions on National Instrument 81-106 Investment Fund Continuous Disclosure (the FAQs). Further, if the financial statements and the accompanying notes for each fund are in a separate document, the relevant statements should only be filed under the fund to which they pertain (consistent with item E-2 in the FAQs). Please note that only the disclosure relevant to a particular fund should be filed under that fund's profile on SEDAR.

In one example, a fund manager produced stand-alone financial statements for each fund, but filed all the financial statements and MRFPs under every fund's profile. This made it very difficult to find the disclosure applicable to the individual fund. In this case, we requested that future SEDAR filings be corrected.

6. -- Regulatory Compliance

6.1 -- Commissions to Related Parties

Where commissions were paid to brokerage firms that are affiliates of an investment fund, we asked for confirmation that the fund complied with the reporting requirement in paragraph 117(1)(c) of the Securities Act (Ontario). Investment funds must file a monthly report when a fund pays a fee to a related company on a purchase or sale of portfolio securities, unless the fund has obtained exemptive relief from this requirement. Some exemptive relief obtained in the past can no longer be relied upon as it was conditional on certain disclosure being provided in the statement of portfolio transactions, which is no longer required.

6.2 -- Financial Highlights Tables

Part A, subsection 1(c) of the Form states that we do not generally mandate the use of a specific format for the MRFP, except for financial highlights and past performance as required by items 3 and 4 of Parts B and C of the Form. We found that approximately 40% of fund managers did not follow the set format of the financial highlights tables.

For example, with the implementation of Section 3855 of the CICA Handbook, some funds added a new line in the Fund's Net Asset Value (NAV) per Unit/Share table to represent the effect of the new accounting policy on NAV. We indicated in our comment letters that, while an explanation of the difference can be added to the MRFP, the tables' format must be maintained.

One fund manager added new ratios to the Ratios and Supplemental Data table, such as "MER excluding performance fee". In this manager's opinion, performance fees are not prevalent in the industry and it believes that additional ratios will benefit investors and provide fuller disclosure. Again, while an explanation can be added to the MRFP, additional lines cannot be included in the standard tables. The format of the financial highlights and past performance tables must be adhered to as mandated by the Form to ensure comparability between investment funds.

6.3 -- Management Fees

The purpose of the requirement in Part B, section 3.3 of the Form is to promote transparency around the composition of management fees. The FAQs discuss our expectations with respect to management fee breakdown in items C-8 through to C-10. We remind investment funds that the purpose of the breakdown is to explain to investors what services are provided in exchange for the management fee. If services cannot be individually itemized, the nature of those services should at least be described qualitatively. For example, some funds did not indicate that the manager's fee for acting as trustee is included in the management fee. Even if trustee fees are not separately recorded, the management fee breakdown should disclose that these fees form part of the management fee.

Item C-8 in the FAQs states that the breakdown of management fees does not have to add to 100%, as the item requires disclosure of the major services paid for out of the management fee. We expect services to be expressed as an actual percentage of management fees, not as an estimate or a range, because the MRFP reports the prior period's activity. We also reiterate that the management fees breakdown must disclose any differences between classes or series.

REMINDERS

Some of the requirements of our rules were overlooked. Based on our review, we provide the following reminders.

MRFP

6.4 -- Investment Objective and Strategies

Approximately 40% of fund managers should have provided a more concise summary of the investment objective and strategies of their investment funds. The disclosure must be a concise summary of the fundamental investment objective and strategies of the investment fund, and not merely copied from the prospectus (Part B, section 2.1 of the Form). For some funds, we found that the investment objectives and strategies disclosed in the MRFP and simplified prospectus had exactly the same wording.

6.5 -- Risk

Approximately 40% of fund managers did not provide an adequate discussion of risk. A discussion of how changes to the investment fund have affected the overall level of risk associated with an investment in the investment fund is required (Part B, section 2.2 of the Form). We noted that some funds merely repeated the risk information contained in the fund's prospectus or annual information form, while others only examined the impact of the main risk factors during the financial period. In both examples, the disclosure is generally incomplete as the discussion of risk should be focused on explaining how changes to the investment fund have affected the overall level of risk. We expect investment funds to provide a commentary on whether changes in the fund have had an impact on risk, along with a discussion of whether the suitability of the investment has changed from what was previously disclosed in the prospectus.

6.6 -- Annual Compound Returns

(a) Multiple series

Almost all investment funds with multiple series discussed the performance of only one series of the investment fund, typically the retail series. The Form requires a discussion of the performance of the investment fund relative to the broad-based securities market index (Part B, subsection 4.3(3)) and NI 81-106 states that the distinctions between the series must be disclosed in the MRFP (subsection 7.2(2)). At a minimum, investment funds must provide an explanation as to how the performance of all series differs from the specific series discussed.

(b) Change in index from prior period

If an index is different from the one included in the most recently filed MRFP, the reasons for the change must be explained and the requirements relating to annual compound returns must be disclosed separately for both the new and former indices for the financial year (Part B, subsection 4.3(4) of the Form). This means that both indices must appear in the annual compound returns table in the year of the change to help readers compare the fund's performance to the new and former indices. One investment fund showed a blend of the new and former indices, which does not fulfil the requirement.

(c) Non-standard performance periods

Part B, item 4 of the Form only allows the disclosure of past performance for the ten, five, three, one year, and since inception periods in the annual MRFP. Part C also allows for the inclusion of the interim period in the bar chart of the interim MRFP. We do not believe that the discussion of past performance should focus on non-standard performance periods such as the six-month return in the annual MRFP, or the quarterly return in the interim MRFP. In our comment letters, we asked that future discussions be limited to the standard performance periods.

6.7 -- Interim MRFP

We remind preparers that the interim MRFP was specifically designed as an update to the last annual MRFP and was intended to be a shorter document. Interim MRFPs are not required to repeat all of the annual MRFP disclosure, but only update the required sections in Part C of the Form.

FINANCIAL STATEMENTS

6.8 -- Mandatory Notes to Financial Statements

NI 81-106 lists items which must be disclosed in the notes to the financial statements (subsection 3.6(1)). We found that not all information required was disclosed. For example, the method used to allocate income and expenses, and realized and unrealized capital gains and losses to each class was sometimes not disclosed in the notes (item 2(d)). Also missing was the basis for determining cost of portfolio assets (item (1)). Almost all investment funds only discussed the basis for determining cost in the context that gains and losses on securities sold were determined on the basis of average cost. We remind investment funds to include a more general statement about the basis for determining the cost of portfolio assets.

OTHER MATTERS

6.9 -- National Instrument 81-102 Mutual Funds Compliance Reports

Some investment funds did not file the compliance report from their custodian to the securities regulatory authority within 30 days after the filing of the annual financial statements (subsection 6.7(3) of National Instrument 81-102 Mutual Funds (NI 81-102)). In addition, some investment funds did not file the report describing compliance with Parts 9, 10 and 11 of NI 81-102, along with their auditor's compliance report, within the time limit as required by Part 12 of NI 81-102. We remind investment funds that the above reports must be filed on time.

6.10 - Annual Notification of Unitholders' Rights to Redemption

Fund managers are required to notify securityholders annually of their redemption rights (subsections 10.1(3) and 10.1(4) of NI 81-102). Some investment funds fulfilled this requirement in the past by including a note in the annual financial statements explaining the rights of securityholders with respect to redemption of securities. Under NI 81-106, investment funds are allowed to deliver certain continuous disclosure documents according to standing or annual instructions received from securityholders, which means that financial statements are not required to be sent to all securityholders anymore (sections 5.2 and 5.3 of NI 81-106). We remind investment funds that the requirements of NI 81-102 to provide all securityholders, at least annually, with a statement outlining rights with respect to redemptions may no longer be met by including it in the financial statements if those financial statements are not sent to every unitholder.

7. -- Conclusion

Our findings suggest that investment funds can improve the quality of their continuous disclosure. Good disclosure is an opportunity to reach investors and advisors. We expect funds to consider the guidance in this notice when reviewing their continuous disclosure records to ensure their disclosure documents comply with NI 81-106. In future situations where disclosure requirements are not met, we will ask that the disclosure document be revised and refiled.

In some cases, staff is continuing to correspond with investment funds included in this review to obtain additional information and resolve the issues identified. On completion of this review, staff will expand our scope to include other investment funds such as closed-end funds, exchange traded funds, labour sponsored investment funds, limited partnerships, and scholarship plans. We will communicate our findings of the continuous disclosure of those types of investment funds in the future.

8. -- Questions

Questions may be referred to:

May 29, 2008

Borealis International 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

BOREALIS INTERNATIONAL INC.,

SYNERGY GROUP (2000) INC.,

INTEGRATED BUSINESS CONCEPTS INC.,

CANAVISTA CORPORATE SERVICES INC.,

CANAVISTA FINANCIAL CENTER INC.,

SHANE SMITH, ANDREW LLOYD, PAUL LLOYD,

VINCE VILLANTI, LARRY HALIDAY, JEAN BREAU,

JOY STATHAM, DAVID PRENTICE, LEN ZIELKE,

JOHN STEPHAN, RAY MURPHY,

ALEXANDER POOLE,DEREK GRIGOR,

EARL SWITENKY, MICHELLE DICKERSON,

DEREK DUPONT, BARTOSZ EKIERT,

ROSS MACFARLANE, BRIAN NERDAHL,

HUGO PITTOORS and LARRY TRAVIS

AMENDED

NOTICE OF HEARING

(Sections 127 and 127.1)

TAKE NOTICE that the Ontario Securities Commission will hold a hearing pursuant to sections 127 and 127.1 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, in the Large Hearing Room, 17th Floor, commencing on May 27, 2008, at 2:30 p.m. or as soon thereafter as the hearing can be held;

AND TAKE NOTICE that the purpose of the hearing is to consider whether:

(a) pursuant to sections 127(1) and (5) of the Act, to order pursuant to clause 2 of section 127(1) that trading in any securities by Michelle Dickerson, Derek Dupont, Bartosz Ekiert, Ross Macfarlane, Brian Nerdahl, Hugo Pittoors and Larry Travis shall cease, and that pursuant to clause 3 of section 127(1), any exemptions contained in Ontario securities law shall not apply to them, and pursuant to section 127(7) to continue such order until November 27, 2008;

(b) pursuant to sections 127(1), (5) and (7) of the Act, to continue the Temporary Order made November 15, 2007 until November 27, 2008 to provide pursuant to clause 2 of section 127(1) that trading in any securities of and by the respondents named therein, including Alexander Poole ("Poole") shall cease, and that pursuant to clause 3 of section 127(1), any exemptions contained in Ontario securities law shall not apply to the respondents named therein, including Poole;

(c) at the conclusion of the hearing, to make an order pursuant to clause 1 of section 127(1) that the registration of Poole be terminated, suspended or restricted, or that terms and conditions be placed or continued on his registration;

(d) at the conclusion of the hearing, to make an order pursuant to clause 2 of section 127(1) that trading in any securities by the respondents cease permanently or for such period as is specified by the Commission;

(e) at the conclusion of the hearing, to make an order pursuant to clause 2.1 of section 127(1) that acquisition of any securities by the respondents is prohibited permanently or for such period as is specified by the Commission;

(f) at the conclusion of the hearing, to make an order pursuant to clause 3 of section 127(1) that any exemptions contained in Ontario securities law do not apply to the respondents permanently or for such period as is specified by the Commission;

(g) at the conclusion of the hearing, to make an order pursuant to clause 6 of section 127(1) that the respondents be reprimanded;

(h) at the conclusion of the hearing, to make an order pursuant to clause 7 of section 127(1) that each of the individual respondents resign all positions that he or she holds as a director or officer of an issuer;

(i) at the conclusion of the hearing, to make an order pursuant to clause 8 of section 127(1) that each of the individual respondents be prohibited from becoming or acting as a director or officer of any issuer;

(j) at the conclusion of the hearing, to make an order pursuant to clause 8.2 of section 127(1) that the respondents be prohibited from becoming or acting as a director or officer of a registrant;

(k) at the conclusion of the hearing, to make an order pursuant to clause 9 of section 127(1) that the respondents each pay an administrative penalty for each failure to comply with Ontario securities law;

(l) at the conclusion of the hearing, to make an order pursuant to clause 10 of section 127(1) that the respondents each disgorge to the Commission any amounts obtained as a result of their non-compliance with Ontario securities law; and

(m) at the conclusion of the hearing, to make an order pursuant to section 127.1 that the respondents pay the costs of the investigation and hearing.

BY REASON OF the allegations set out in the Amended Statement of Allegations dated May 22, 2008 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 22nd day of May, 2008.

IN THE MATTER OF

THE SECURITIES ACT,

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

AND

IN THE MATTER OF

BOREALIS INTERNATIONAL INC.,

SYNERGY GROUP (2000) INC.,

INTEGRATED BUSINESS CONCEPTS INC.,

CANAVISTA CORPORATE SERVICES INC.,

CANAVISTA FINANCIAL CENTER INC.,

SHANE SMITH, ANDREW LLOYD, PAUL LLOYD,

VINCE VILLANTI, LARRY HALIDAY, JEAN BREAU,

JOY STATHAM, DAVID PRENTICE, LEN ZIELKE,

JOHN STEPHAN, RAY MURPHY,

ALEXANDER POOLE,DEREK GRIGOR,

EARL SWITENKY, MICHELLE DICKERSON,

DEREK DUPONT, BARTOSZ EKIERT,

ROSS MACFARLANE, BRIAN NERDAHL,

HUGO PITTOORS and LARRY TRAVIS

AMENDED

STATEMENT OF ALLEGATIONS

OF STAFF OF THE

ONTARIO SECURITIES COMMISSION

Staff of the Ontario Securities Commission (the "Commission") make the following allegations:

Corporate Respondents

1. Borealis International Inc. ("Borealis") is an Ontario company which was incorporated on February 16, 2007. Borealis is not a reporting issuer and has never been registered with the Commission.

2. Synergy Group (2000) Inc. ("Synergy") is an Ontario company which was incorporated on June 15, 2004. Synergy is not a reporting issuer and has never been registered with the Commission.

3. Integrated Business Concepts Inc. ("IBC") is an Ontario company which was incorporated on June 14, 1994. IBC is not a reporting issuer and has never been registered with the Commission.

4. Borealis, Synergy and IBC share the same registered address: 235 Yorkland Boulevard, Suite 202, North York, Ontario.

5. Canavista Corporate Services Inc. ("Canavista Corporate") is an Ontario company which was incorporated on September 1, 2005. Canavista Corporate is not a reporting issuer and has never been registered with the Commission.

6. Canavista Financial Center Inc. ("Canavista Financial") is an Ontario company which was incorporated on July 31, 1996. Canavista Financial is not a reporting issuer and has never been registered with the Commission.

7. Canavista Corporate and Canavista Financial share the same registered address: 311 George Street North, Peterborough, Ontario. Borealis and Synergy also have offices at this address.

Individual Respondents

8. Shane Smith ("Smith") is a resident of Peterborough, Ontario. Smith is not currently registered with the Commission.

9. Smith is a respondent in a pending Commission proceeding (the "Sabourin Proceeding"). Smith is subject to a cease trade order which was issued by the Commission on December 7, 2006 and extended by further orders of the Commission on December 20, 2006 , June 14, 2007 and April 7, 2008 (the "Sabourin Cease Trade Order").

10. Smith holds himself out as the President of Borealis and of Synergy.

11. Andrew Lloyd ("Lloyd") is a resident of Peterborough, Ontario. Lloyd is not currently registered with the Commission.

12. Lloyd is a respondent in the Sabourin Proceeding and is subject to the Sabourin Cease Trade Order.

13. Lloyd acts as Synergy's Regional Manager GTA and Central Ontario and as the Regional Manager and Regional Contact for Borealis in Central and North Ontario. Lloyd is also a director of Canavista Corporate and the Vice-President and a director of Canavista Financial.

14. Paul Lloyd is Lloyd's father and is a resident of Peterborough, Ontario. Paul Lloyd is a director of Canavista Corporate and the President and a director of Canavista Financial. Paul Lloyd is not currently registered with the Commission.

15. Vince Villanti ("Villanti") is a resident of Whitby, Ontario. Villanti is the President and a director of Borealis, and the Executive Director and a director of IBC. Villanti has never been registered with the Commission.

16. Larry Haliday ("Haliday") is a resident of Richmond Hill, Ontario. Haliday is a director of IBC. Haliday has never been registered with the Commission.

17. Jean Breau ("Breau") is a resident of Whitby, Ontario. Breau is the President and a director of Synergy. Breau has never been registered with the Commission.

18. Joy Statham ("Statham") is a resident of Ottawa, Ontario. Statham is not currently registered with the Commission.

19. David Prentice ("Prentice") is a resident of Mississauga, Ontario. Prentice holds himself out as the Executive Vice-President of Synergy. Prentice has never been registered with the Commission.

20. Len Zielke ("Zielke") is a resident of Richmond, British Columbia. Zielke holds himself out as Synergy's Regional Manager and Regional Contact for British Columbia, Alberta and Saskatchewan. Zielke has never been registered with the Commission.

21. John Stephan ("Stephan") is a resident of London, Ontario. Stephan holds himself out as Synergy's Regional Manager for Western and South-Western Ontario and the Borealis Regional Contact for Western Ontario. Stephan is not currently registered with the Commission.

22. Ray Murphy ("Murphy") is a resident of Kingston, Ontario. Murphy holds himself out as Synergy's Regional Manager for Eastern Ontario, Quebec and the Maritimes and as Borealis' Regional Contact for Quebec, Maritimes, Manitoba and Eastern Ontario. Murphy is not currently registered with the Commission.

23. Alexander Poole ("Poole") is a resident of Waterloo, Ontario and is currently registered with the Commission as a salesperson in the categories of mutual fund dealer and limited market dealer.

24. Derek Grigor ("Grigor") is a resident of Okotoks, Alberta. Grigor has never been registered with the Commission.

25. Earl Switenky ("Switenky") is a resident of Kelowna, British Columbia. Switenky has never been registered with the Commission.

26. Michelle Dickerson ("Dickerson") is a resident of Napanee, Ontario. Dickerson has never been registered with the Commission.

27. Derek Dupont ("Dupont") is a resident of Nepean, Ontario. Dupont is not currently registered with the Commission.

28. Bartosz Ekiert ("Ekiert") is a resident of Kitchener, Ontario. Ekiert has never been registered with the Commission.

29. Ross Macfarlane ("Macfarlane") is a resident of Powell River, British Columbia. Macfarlane has never been registered with the Commission.

30. Brian Nerdahl ("Nerdahl") is a resident of Elmira, Ontario. Nerdahl is not currently registered with the Commission.

31. Hugo Pittoors ("Pittoors") is a resident of Calgary, Alberta. Pittoors has never been registered with the Commission.

32. Larry Travis ("Travis") is a resident of Chatham, Ontario. Travis has never been registered with the Commission.

Borealis Guaranteed Return Investment Certificate

33. Borealis and Synergy representatives and associates promote and sell an investment called the Borealis Guaranteed Return Investment Certificate ("Borealis GRIC"). The Borealis GRIC is a form of prime bank investment scheme. The Borealis GRIC is described in promotional material as a "bank-guaranteed product" which requires a minimum initial investment of $150,000 with minimum additional investments of $25,000. Investors are promised fixed returns of 10 to 18 percent. The Borealis GRIC is purportedly "locked in" for 24 months.

34. The respondents' Borealis GRIC sales approach includes making representations and providing information to investors which are false, inaccurate and misleading, including that:

(a) the Borealis GRIC was developed by Synergy and is promoted as the product of a "proprietary strategic alliance" with Borealis, Atlantic Trust Co. ("Atlantic Trust") and The Laiki Group;

(b) the Borealis GRIC is regulated by the Financial Consumer Agency of Canada ("FCAC") and the "Bank Act";

(c) the "first $100,000" of a Borealis GRIC is "protected" by Canada Deposit Insurance Corporation ("CDIC"); and

(d) Borealis has purchased the Croatian (Toronto) Credit Union Limited.

35. IBC is described as a recipient of funds from Atlantic Trust. Atlantic Trust and The Laiki Group are not participants in the Borealis GRIC, and have no arrangements with Borealis, Synergy nor any other of the respondents. References to Atlantic Trust, The Laiki Group, FCAC, the Bank Act and CDIC are part of an effort by the respondents to give the appearance of legitimacy to the scheme described herein.

Scope of Activity

36. Smith, Lloyd and Paul Lloyd have each promoted, and sold or attempted to sell, the Borealis GRIC personally and through representatives and associates. To this end, Smith, Lloyd and Paul Lloyd are variously acting with and through Borealis, Synergy, Canavista Corporate, Canavista Financial and/or IBC.

37. Statham, Prentice, Zielke, Stephan, Murphy, Poole, Grigor, Switenky, Dickerson, Dupont, Ekiert, Macfarlane, Nerdahl, Pittoors and Travis have each promoted, and sold or attempted to sell, the Borealis GRIC.

38. Villanti, Haliday and Breau, through their respective positions with Borealis, Synergy and IBC, have authorized, permitted or acquiesced in the unlawful conduct described herein.

39. The respondents' activity has resulted in sales of the Borealis GRIC in excess of $16 million.

Investment Contracts

40. The Borealis GRIC is an "investment contract" and therefore a "security" as defined in section 1(1)(n) of the Ontario Securities Act, R.S.O. 1990, c.S.5, as amended (the "Act").

Alberta Securities Commission Proceeding

41. Synergy, Borealis, Zielke, Prentice, Smith, Grigor and Switenky are respondents in a proceeding issued by the Alberta Securities Commission and are subject to a cease trade order, which is in place until a hearing is concluded and a decision rendered, or until otherwise ordered.

Borealis Cease Trade Order

42. On November 15, 2007, the Commission ordered that all trading in securities of the respondents, with the exception of Poole, cease, that trading in securities by the respondents, with the exception of Poole, cease, and that any exemptions contained in Ontario securities law did not apply to the respondents, with the exception of Poole. The Order also provided for the imposition of terms and conditions on Poole's registration (the "Borealis Cease Trade Order"). The Borealis Cease Trade Order was continued by orders of the Commission on November 28, 2007 and January 11, 2008.

Breach of Cease Trade Orders

43. Through their activity described herein, Smith and Lloyd have breached the Sabourin Cease Trade Order.

44. After November 15, 2007, each of Smith, Lloyd and Poole traded in securities, and accordingly, each has breached the Borealis Cease Trade Order.

Conduct Contrary to Ontario Securities Law and Conduct Contrary to the Public Interest

45. The activities of the respondents constitute trading in securities without registration in respect of which no exemption was available, contrary to section 25 of the Act.

46. The activities of the respondents constitute distributions of securities for which no preliminary prospectus and prospectus were issued nor receipted by the Director, contrary to section 53 of the Act.

47. Each of the individuals who are directors and officers of the corporate respondents, including de facto directors and officers of the corporate respondents, have authorized, permitted or acquiesced in the corporate respondents' non-compliance with Ontario securities law, and accordingly, failed to comply with Ontario securities law contrary to section 129.2 of the Act.

48. Each of the respondents has directly or indirectly engaged or participated in an act, practice or course of conduct relating to securities which he, she or it knows, or reasonably ought to know, has perpetrated a fraud on investors in the Borealis GRIC, contrary to section 126.1 of the Act.

49. The respondents' conduct is contrary to the public interest and harmful to the integrity of the Ontario capital markets.

DATED AT TORONTO this 22nd day of May, 2008.

David Berry

FOR IMMEDIATE RELEASE

May 22, 2008

IN THE MATTER OF

THE SECURITIES ACT,

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

AND

IN THE MATTER OF

A REQUEST FOR A HEARING AND REVIEW

OF A DECISION OF A HEARING PANEL OF

MARKET REGULATION SERVICES INC.

AND

IN THE MATTER OF

THE UNIVERSAL MARKET INTEGRITY RULES

AND

IN THE MATTER OF

DAVID BERRY

TORONTO -- On May 21, 2008, the Commission issued its Reasons and Decision in the above noted matter.

A copy of the Reasons and Decision dated May 21, 2008 is available at www.osc.gov.on.ca.

Sulja Bros. Building Supplies, Ltd. (Nevada) et al.

FOR IMMEDIATE RELEASE

May 23, 2008

IN THE MATTER OF

THE SECURITIES ACT,

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

AND

IN THE MATTER OF

SULJA BROS. BUILDING SUPPLIES, LTD. (NEVADA),

SULJA BROS. BUILDING SUPPLIES LTD.,

KORE INTERNATIONAL MANAGEMENT INC.,

PETAR VUCICEVICH AND ANDREW DeVRIES

TORONTO -- Following a hearing held today in the above noted matter, the Commission ordered that the Temporary Order is extended to June 23, 2008, and the hearing is adjourned to June 23, 2008 at 10:00 a.m.

A copy of the Order dated May 23, 2008 is available at www.osc.gov.on.ca.

XI Biofuels Inc. et al.

FOR IMMEDIATE RELEASE

May 23, 2008

IN THE MATTER OF

THE SECURITIES ACT,

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

AND

IN THE MATTER OF

XI BIOFUELS INC., BIOMAXX SYSTEMS INC.,

RONALD DAVID CROWE AND VERNON P. SMITH

AND

IN THE MATTER OF

XIIVA HOLDINGS INC. CARRYING ON BUSINESS

AS XIIVA HOLDINGS INC., XI ENERGY COMPANY,

XI ENERGY AND XI BIOFUELS

TORONTO -- Following a hearing on May 22, 2008, the Commission ordered that the Temporary Orders are extended to June 13, 2008 and the XI Hearing and the Xiiva Hearing for the extension of the Temporary Orders and the hearing of the Respondents' Motion are adjourned to June 12, 2008 at 10:30 a.m.

A copy of the Order dated May 22, 2008 is available at www.osc.gov.on.ca.

Borealis International Inc. et al.

FOR IMMEDIATE RELEASE

May 26, 2008

IN THE MATTER OF

THE SECURITIES ACT,

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

AND

IN THE MATTER OF

BOREALIS INTERNATIONAL INC.,

SYNERGY GROUP (2000) INC.,

INTEGRATED BUSINESS CONCEPTS INC.,

CANAVISTA CORPORATE SERVICES INC.,

CANAVISTA FINANCIAL CENTER INC.,

SHANE SMITH, ANDREW LLOYD, PAUL LLOYD,

VINCE VILLANTI, LARRY HALIDAY, JEAN BREAU,

JOY STATHAM, DAVID PRENTICE, LEN ZIELKE,

JOHN STEPHAN, RAY MURPHY,

ALEXANDER POOLE, DEREK GRIGOR,

EARL SWITENKY, MICHELLE DICKERSON,

DEREK DUPONT, BARTOSZ EKIERT,

ROSS MACFARLANE, BRIAN NERDAHL,

HUGO PITTOORS AND LARRY TRAVIS

TORONTO -- The Office of the Secretary issued an Amended Notice of Hearing on May 22, 2008 scheduling the hearing in the above named matter to be held at the offices of the Commission, on the 17th Floor, Large Hearing Room, 20 Queen St. West, Toronto, Ontario, commencing on May 27, 2008, at 2:30 p.m., or as soon thereafter as the hearing can be held.

A copy of the Amended Notice of Hearing and Amended Statement of Allegations is available at www.osc.gov.on.ca.

Adrian Samuel Leemhuis et al.

FOR IMMEDIATE RELEASE

May 26, 2008

IN THE MATTER OF

THE SECURITIES ACT,

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

AND

IN THE MATTER OF

ADRIAN SAMUEL LEEMHUIS,

FUTURE GROWTH GROUP INC.,

FUTURE GROWTH FUND LIMITED,

FUTURE GROWTH GLOBAL FUND LIMITED,

FUTURE GROWTH MARKET NEUTRAL FUND LIMITED,

FUTURE GROWTH WORLD FUND, AND

ASL DIRECT INC.

TORONTO -- Following a hearing held in the above noted matter, today the Commission issued an Order that the Temporary Orders issued on April 22, 2008 and May 1, 2008, are continued until June 17, 2008 and that this matter is adjourned until June 16, 2008 at 10:00 a.m.

A copy of the Order is available at www.osc.gov.on.ca.

Borealis International Inc. et al.

FOR IMMEDIATE RELEASE

May 27, 2008

IN THE MATTER OF

THE SECURITIES ACT,

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

AND

IN THE MATTER OF

BOREALIS INTERNATIONAL INC.,

SYNERGY GROUP (2000) INC.,

INTEGRATED BUSINESS CONCEPTS INC.,

CANAVISTA CORPORATE SERVICES INC.,

CANAVISTA FINANCIAL CENTER INC.,

SHANE SMITH, ANDREW LLOYD, PAUL LLOYD,

VINCE VILLANTI, LARRY HALIDAY, JEAN BREAU,

JOY STATHAM, DAVID PRENTICE, LEN ZIELKE,

JOHN STEPHAN, RAY MURPHY,

ALEXANDER POOLE, DEREK GRIGOR,

EARL SWITENKY,MICHELLE DICKERSON,

DEREK DUPONT, BARTOSZ EKIERT,

ROSS MACFARLANE, BRIAN NERDAHL,

HUGO PITTOORS AND LARRY TRAVIS

TORONTO -- Following a hearing held today, the Commission issued an Order in the above noted matter. This matter is set to return before the Commission on June 17, 2008 at 10:00 a.m.

A copy of the Order dated May 27, 2008 is available at www.osc.gov.on.ca.

Chapter 2 -- Decisions, Orders and Rulings

Bioscrypt Inc.

Headnote

National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions - Application for an order that the issuer is not a reporting issuer - Filer has no publicly held securities - Requested relief granted.

Applicable Legislative Provisions

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

May 21, 2008

IN THE MATTER OF

THE SECURITIES LEGISLATION OF

ALBERTA, SASKATCHEWAN, MANITOBA,

ONTARIO, QUÉBEC, NEW BRUNSWICK,

NOVA SCOTIA, PRINCE EDWARD ISLAND

AND NEWFOUNDLAND AND LABRADOR

(the Jurisdictions)

AND

IN THE MATTER OF

THE PROCESS OF EXEMPTIVE RELIEF

APPLICATIONS IN MULTIPLE JURISDICTIONS

AND

IN THE MATTER OF

BIOSCRYPT INC. (the Filer)

DECISION

Background

The securities regulatory authority or regulator in each of the Jurisdictions (the Decision Maker) has received an application from the Filer for a decision under the securities legislation of the Jurisdictions (the Legislation) to not be a reporting issuer in the Jurisdictions in accordance with the Legislation (the Exemptive Relief Sought).

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

(a) the Ontario Securities Commission is the principal regulator for this application, and

(b) the decision is the decision of the principal regulator and evidences the decision of each other Decision Maker.

Interpretation

Terms defined in National Instrument 14-101 Definitions have the same meaning in this decision, unless otherwise defined.

Representations

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

1. The Filer was incorporated on June 25, 1987 under the Canada Business Corporations Act (CBCA) as Mytec Technologies Inc. By articles of amendments dated April 6, 2001, the Filer changed its name from Mytec Technologies Inc. to Bioscrypt Inc. The registered and principal office of the Filer is located at 505 Cochrane Drive, Markham, Ontario, L3R 8E3.

2. On February 1, 2008, 6897525 Canada Inc. (the Purchaser), a wholly-owned subsidiary of L-1 Identity Solutions Operating Company (Opco), which is in turn a direct, wholly-owned subsidiary of L-1 Identity Solutions, Inc. (L-1 Parent), offered to acquire all of the issued and outstanding common shares (the Shares) of the Filer by way of an arrangement under the CBCA (the Arrangement), the terms and conditions of which are described in the plan of arrangement contained in the Filer's information circular dated February 1, 2008.

3. The Purchaser is incorporated under the CBCA and was formed solely for the purpose of engaging in the transaction contemplated by the Arrangement. Opco and L-1 Parent are each incorporated under the laws of the State of Delaware. The shares of L-1 Parent's common stock are traded on the New York Stock Exchange under the trading symbol "ID".

4. The Arrangement was approved by the securityholders of the Filer at a special meeting of the Filer on February 29, 2008 and subsequently approved by a final order of the Ontario Superior Court of Justice issued on March 4, 2008.

5. On March 5, 2008 the Purchaser, Opco and L-1 Parent completed the acquisition of all the issued and outstanding Shares of the Filer. As a result of the Arrangement, the Purchaser is now the sole shareholder of the Filer.

6. The Filer is applying for relief to not be a reporting issuer in all of the jurisdictions in Canada in which it is currently a reporting issuer. On April 9, 2008, the Filer filed a notice of voluntary surrender of reporting issuer status in British Columbia pursuant to British Columbia Instrument 11-502 Voluntary Surrender of Reporting Issuer Status. As a consequence of filing this notice, the Filer ceased to be a reporting issuer in British Columbia on April 19, 2008.

7. As a result of the Arrangement, L-1 Parent, by operation of law, became a reporting issuer in British Columbia, Alberta, Saskatchewan, Manitoba, Québec, Nova Scotia, New Brunswick, Prince Edward Island and Newfoundland and Labrador. Neither the Purchaser nor Opco is a reporting issuer, or its equivalent, in any jurisdiction in Canada.

8. Prior to the Arrangement, the Filer's Shares were listed for trading on the Toronto Stock Exchange (the TSX) under the symbol "BYT". The Shares were de-listed from the TSX at the close of trading on March 6, 2008. No securities of the Filer are traded on a marketplace as defined in National Instrument 21-101 Marketplace Operations.

9. The outstanding securities of the Filer, 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.

10. The Filer has no current intention to seek public financing by way of an offering of securities.

11. The Filer is not in default of any of its obligations under the Legislation as a reporting issuer other than the requirement to file by March 31, 2008 annual financial statements, related management's discussion and analysis and officer's certificates, and an annual information form in respect of the year ended December 31, 2007.

Decision

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 Exemptive Relief Sought is granted.

FrontierAlt 2007 Energy & Precious Metals Flow Through LP et al.

Headnote

Mutual Reliance Review System for Exemptive Relief Applications -- 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 their website, and to provide it to securityholders upon request -- Flow-though limited partnerships are short-term investment vehicles formed solely to invest its available funds in flow-through shares of resource issuers -- The securities of flow-through limited partnerships are not redeemable and there is no readily available secondary market for the securities -- A flow-through limited partnership's other continuous disclosure documents will provide all relevant information necessary for investors to understand the its investment objectives and strategies, financial position and future plans.

Rules Cited

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

April 29, 2008

IN THE MATTER OF

THE SECURITIES LEGISLATION OF

BRITISH COLUMBIA, ALBERTA, SASKATCHEWAN,

MANITOBA, ONTARIO, QUÉBEC, NEW BRUNSWICK,

NOVA SCOTIA, NEWFOUNDLAND AND LABRADOR

AND PRINCE EDWARD ISLAND

(the "Jurisdictions")

AND

IN THE MATTER OF

THE MUTUAL RELIANCE REVIEW SYSTEM

FOR EXEMPTIVE RELIEF APPLICATIONS

AND

IN THE MATTER OF

FRONTIERALT 2007 ENERGY &

PRECIOUS METALS FLOW THROUGH LP

(the "2007 Partnership"),

FRONTIERALT 2008 PRECIOUS METALS &

ENERGY FLOW-THROUGH LIMITED PARTNERSHIP

(the "2008 Partnership")

AND FRONTIERALT CAPITAL CORPORATION

("frontierAlt")

(collectively, the "Filers")

MRRS DECISION DOCUMENT

Background

The local securities regulatory authority or regulator (the "Decision Maker") in each of the Jurisdictions has received an application from the Filers on behalf of the 2007 Partnership and the 2008 Partnership (together, the "Partnerships") and each future limited partnership promoted by frontierAlt or its affiliates that is identical to the Partnerships in all respects which are material to this decision (the "Future Partnerships" and collectively with the Partnerships, the "Partnership Filers"), for an exemption from:

(i) the requirement in section 9.2 of National Instrument 81-106 Investment Fund Continuous Disclosure ("NI 81-106") to prepare and file an annual information form (the "AIF");

(ii) the requirement in section 10.3 of NI 81-106 to maintain a proxy voting record (the "Proxy Voting Record"); and

(iii) the requirements in section 10.4 of NI 81-106 to prepare a Proxy Voting Record on an annual basis for the period ending June 30 of each year, to post the Proxy Voting Record on the Filers' website no later than August 31 of each year and to send the Proxy Voting Record to the limited partners of the Partnership Filers (the "Limited Partners") upon request,

((i), (ii), and (iii) are collectively the "Requested Relief").

Under the Mutual Reliance Review System for Exemptive Relief Applications:

(a) the Ontario Securities Commission is the principal regulator for this application; and

(b) this MRRS decision document evidences the decision of each Decision Maker.

Interpretation

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

Representations

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

1. The 2007 Partnership was formed pursuant to the provisions of the Limited Partnerships Act (Ontario) on August 16, 2007 and the 2008 Partnership was formed pursuant to the provisions of the Limited Partnerships Act (Ontario) on December 3, 2007.

2. The 2007 Partnership and the 2008 Partnership filed a final prospectus relating to its initial public offering in each of the provinces of Canada on October 30, 2007 and February 28, 2008, respectively, and became a reporting issuer in each of the provinces of Canada, except Prince Edward Island. Any Future Partnership will be a reporting issuer in each of the Jurisdictions.

3. frontierAlt Energy & Precious Metals Inc. is the general partner (the "2007 General Partner") of the 2007 Partnership and frontierAlt 2008 Precious Metals & Energy Inc. is the general partner (the "2008 General Partner") of the 2008 Partnership. Both the 2007 General Partner and the 2008 General Partner are wholly-owned subsidiaries of frontierAlt.

4. frontierAlt is the promoter of the Partnerships and it or its affiliates will be the promoter of the Future Partnerships.

5. The principal office address and the registered office address of the Filers are located in Toronto, Ontario.

6. The Partnerships were formed, and any Future Partnerships will be formed, to invest in certain common shares ("Flow-Through Shares") of companies that operate, as their principal business, in any of the energy, precious metals, base metals, minerals or other resource-based industries ("Resource Issuers") pursuant to agreements ("Investment Agreements") between the Partnership Filer and the Resource Issuer. Under the terms of each Investment Agreement, the Partnership Filer will subscribe for Flow-Through Shares of the Resource Issuer and the Resource Issuer will agree to incur and renounce to the Partnership Filer, 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 and that may be renounced as Canadian exploration expense to the Partnership Filer.

7. The 2007 Partnership will be dissolved on or about December 31, 2009 and the 2008 Partnership will be dissolved on or about April 30, 2010. Upon such dissolution, the Limited Partners of the respective Partnerships will receive their pro rata share of the net assets of the relevant Partnership, subject to the approval by a special resolution of unitholders of the relevant Partnership to continue the operation of the Partnership with an actively managed portfolio.

8. It is the current intention of the 2007 General Partner that the 2007 Partnership, and the current intention of the 2008 General Partner that the 2008 Partnership, will transfer its assets to an open-end mutual fund corporation managed by frontierAlt Funds Management, an affiliate of frontierAlt, in exchange for shares of a class of shares of such mutual fund corporation. Upon dissolution, the Limited Partners of each of the Partnerships would receive their pro rata share of the shares of that mutual fund. Any Future Partnership will be terminated approximately two years after it is formed on the same basis as the Partnerships.

9. The Partnership Filers are not, and will not be, operating businesses. Rather, each Partnership Filer is, or will be, a short-term special purpose vehicle that will be dissolved within approximately two years of its formation. The primary investment purpose of the Partnerships Filers 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 Issuers renounce resource exploration and development expenditures to the Partnership Filers through Flow-Through Shares.

10. The units of the Partnership Filers (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 the Partnership Filer in order to obtain the desired tax deduction.

11. It is, and will be, a term of the partnership agreement governing the Partnership Filers that the general partner of the particular Partnership Filer has, and will have, the authority to manage, control, administer and operate the business and affairs of the Partnership Filers, including the authority to take all measures necessary or appropriate for the business, or ancillary thereto, and to ensure that the Partnership Filers comply with all necessary reporting and administrative requirements. frontierAlt provides or will cause to be provided all of the administrative services required by the Partnership Filers.

12. Each of the Limited Partners of the Partnership Filers 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.

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

14. Given the limited range of business activities to be conducted by the Partnership Filers, 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 Partnership Filers would not be of any benefit to the Limited Partners and may impose a material financial burden on the Partnership Filers. Upon the occurrence of any material change to a Partnership Filer, Limited Partners would receive all relevant information from the material change reports the Partnership Filer is required to file with the Decision Makers.

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

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

17. Given a Partnership Filer'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 Partnership Filer exercised or failed to exercise its proxy voting rights, as the Partnership Filer would likely be dissolved by the time any potential change could materialize.

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

19. The Filers are of the view that the Requested Relief is not against the public interest, is in the best interests of the Partnership Filers and their Limited Partners and represents the business judgment of responsible persons uninfluenced by considerations other than the best interest of the Partnership Filers and their Limited Partners.

Decision

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.

The decision of the Decision Makers under the Legislation is that the Requested Relief is granted.

Aim Funds Management Inc. et al.

Headnote

National Policy 11-203 Process For Exemptive Relief Applications in Multiple Jurisdictions - Top Funds proposing to invest a portion of their assets in index participation units (IPUs) issued by mutual funds managed by a U.S. affiliate - Because investment by top funds in underlying IPUs not made in full compliance with requirements of sections 2.5 of NI 81-102, top funds unable to rely on statutory exemption in subsection 2.5(7) of NI 81-102 providing relief from mutual fund conflict of interest investment restrictions and mutual fund conflict of interest reporting requirements - Top Funds may, either alone or together with other related mutual funds, become substantial security holders of the underlying IPUs - Substantial security holder of manager of top funds may make a seed capital investment in underlying IPUs which would represent a significant interest in those IPUs - Top funds exempted from mutual fund conflict of interest investment restrictions and manager of top funds exempted from mutual fund conflict of interest reporting requirements, subject to compliance with certain conditions - Securities Act (Ontario).

Applicable Legislative Provisions

Securities Act, R.S.O. 1990, c. S.5, as am., ss. 111(2)(b), 111(2)(c)(ii), 111(3), 113, 117(1)(a), 117(1)(d), 117(2).

Rules Cited

National Instrument 81-102 Mutual Funds, ss. 2.5, 2.5(7).

May 9, 2008

IN THE MATTER OF

THE SECURITIES LEGISLATION OF

ONTARIO

(the Jurisdiction)

and

IN THE MATTER OF

THE PROCESS FOR EXEMPTIVE RELIEF

APPLICATIONS IN MULTIPLE JURISDICTIONS

AND

IN THE MATTER OF

AIM FUNDS MANAGEMENT INC.

(the Filer)

AND

INVESCO TRIMARK RETIREMENT

PAYOUT 2023 PORTFOLIO,

INVESCO TRIMARK RETIREMENT

PAYOUT 2028 PORTFOLIO,

INVESCO TRIMARK RETIREMENT

PAYOUT 2033 PORTFOLIO AND

INVESCO TRIMARK RETIREMENT

PAYOUT 2038 PORTFOLIO

(the Top Funds)

DECISION

Background

The principal regulator in the Jurisdiction has received an application from the Filer on its behalf and on behalf of the Top Funds and any other mutual fund for which the Filer acts as manager (together with the Top Funds, the Funds) for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) exempting:

1. the Funds from:

(a) the investment restriction in paragraph 111(2)(b) of the Securities Act (Ontario) (the Act) which prohibits a mutual fund from knowingly making an investment in a person or company in which the mutual fund, alone or together with one or more related mutual funds, is a substantial security holder;

(b) the investment restriction in clause 111(2)(c)(ii) of the Act which prohibits a mutual fund from knowingly making an investment in an issuer in which any person or company who is a substantial security holder of the mutual fund, its management company, manager or distribution company, has a significant interest; and

(c) the investment restriction in subsection 111(3) of the Act which prohibits a mutual fund or its management company or its distribution company from knowingly holding an investment described in (a) or (b) above (this paragraph (c) together with paragraphs (a) and (b) above are together referred to in this decision as the Mutual Fund Conflict of Interest Investment Restrictions); and

2. the Filer from the management company reporting requirement in paragraphs 117(1)(a) and 117(1)(d) of the Act which require that a management company file a report of every transaction of purchase or sale of securities between a mutual fund it manages and any related person or company, and any transaction in which, by arrangement other than an arrangement relating to insider trading in portfolio securities, the mutual fund is a joint participant with one or more of its related persons or companies (the Mutual Fund Conflict of Interest Reporting Requirements, and together with the exemption sought from the Mutual Fund Conflict of Interest Investment Restrictions, the Exemption Sought)

in connection with the Funds' proposed investments in securities of the Underlying ETFs (as defined in this decision).

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 British Columbia, Alberta, Saskatchewan, Nova Scotia and New Brunswick.

Interpretation

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

Invesco means Invesco Ltd.

Invesco PowerShares means Invesco PowerShares Capital Management LLC.

Trusts means PowerShares Exchange-Traded Fund Trust and PowerShares Exchange-Traded Fund Trust II.

Underlying ETFs means exchange traded funds managed by the Filer or an affiliate or associate of the Filer which exist currently or which may be created in the future, and which each meet the definition of an "index participation unit" under NI 81-102.

NI 81-102 means National Instrument 81-102 Mutual Funds.

Representations

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

1. The Filer is a corporation amalgamated under the laws of Ontario with its head office in Toronto, Ontario. The Filer will act as the trustee, manager and portfolio adviser for the Top Funds.

2. The Top Funds will be open-end mutual fund trusts established pursuant to a Declaration of Trust governed under the laws of Ontario.

3. A preliminary simplified prospectus in respect of the Top Funds was filed via SEDAR under project #1232843 on March 20, 2008. Once a final prospectus for the Top Funds is filed and a receipt is obtained, the Top Funds will be "reporting issuers" or equivalent in each province and territory of Canada.

4. Currently, the Underlying ETFs are mutual funds that attempt to replicate the performance of various non-Canadian indices, the securities of which are currently listed and traded on either the American Stock Exchange (AMEX) or the New York Stock Exchange (NYSE) in the United States. As a result, the Underlying ETFs meet the definition of an "index participation unit" under NI 81-102. In the future, the Filer or its associates or affiliates may offer other exchange traded funds that meet the definition of an "index participation unit" under NI 81-102.

5. Invesco PowerShares is the manager and portfolio advisor of the existing Underlying ETFs.

6. The Filer and Invesco PowerShares are affiliates as they are both indirect wholly owned subsidiaries of Invesco. Invesco is a publicly listed independent global investment manager with approximately US$475 billion in assets under management as at February 29, 2008.

7. Currently, the Underlying ETFs are investment portfolios of the Trusts, both of which are organized as Massachusetts business trusts. Each Trust is an open-end management investment company, registered under the Investment Company Act of 1940, as amended. In the future, the Filer or its associates or affiliates may offer other exchange-traded funds that are structured as trusts or corporations.

8. The Top Funds seek to achieve a total investment return until specific horizon dates. Total investment return includes interest, dividends and capital gains. The Top Funds use dynamic asset allocation to allocate assets among mutual funds, which may include the Underlying ETFs. These mutual funds invest primarily in fixed-income and/or other debt securities or primarily in equity securities. As each Top Fund approaches its horizon date, an increasing proportion of its assets will be invested in fixed-income funds, money market funds and/or short-term debt securities. As a result, the asset allocation of the Top Funds will become increasingly conservative to focus on capital preservation and income. Each Top Fund seeks to provide a regular distribution stream for its investors.

9. Securities of the Underlying ETFs may only be directly purchased or redeemed from a fund in large blocks called "creation units" by "authorized participants" that have entered into a contract with its manager to purchase and redeem such securities. Generally, such purchases and redemptions may only be done "in kind" through the deposit or receipt of a portfolio of securities that substantially replicate the securities included in the index that the Underlying ETF attempts to track.

10. The vast majority of trading in securities of the Underlying ETFs will typically occur in the secondary market.

11. As is the case with the purchase or sale of any other equity security made on an exchange, brokers are typically paid a commission in connection with trading in securities of exchange-traded funds.

12. It is proposed that the Funds will purchase and sell securities of the Underlying ETFs on the applicable exchange using third party brokers who are "authorized participants" and that the Funds will pay commissions to these brokers in connection with the purchase and sale of such securities.

13. As Invesco PowerShares is an affiliate of the Filer, the Funds are prohibited by paragraph 2.5(2)(e) of NI 81-102 from purchasing securities of the existing Underlying ETFs unless no sales fees or redemption fees are payable in connection with a purchase or redemption of such securities. To the extent brokerage fees paid to arm's length third party brokers by the Funds in connection with trades in securities of the Underlying ETFs may be considered to be "sales fees or redemption fees", the Funds have sought and obtained relief from compliance with paragraph 2.5(2)(e) of NI 81-102 by way of a decision dated May 8, 2008 (the NI 81-102 Exemption). The NI 81-102 Exemption permits the Funds to invest in securities of the Underlying ETFs, subject to compliance with the requirements pertaining to mutual funds investing in other mutual funds set out in section 2.5 of NI 81-102, except the requirement in paragraph 2.5(2)(e).

14. The NI 81-102 Exemption maintains the Funds' requirement to ensure that the Funds' investments in the Underlying ETFs will not cause the Funds to pay duplicate management fees or incentive fees. In addition, the Filer will not be allowed to vote the securities of an Underlying ETF that are held by a Fund but may, if it so chooses, arrange for all of the securities a Fund holds of an Underlying ETF to be voted by the beneficial holders of securities of the Fund.

15. If the Funds' investment in securities of the Underlying ETFs complied fully with each of the requirements of section 2.5 of NI 81-102, the Exemption Sought would not be required because subsection 2.5(7) of NI 81-102 exempts mutual funds that invest in other mutual funds from the Mutual Fund Conflict of Interest Investment Restrictions and Mutual Fund Conflict of Interest Reporting Requirements provided the investment is made in compliance with each of the requirements of section 2.5 of NI 81-102.

16. In the absence of an exemption from the Mutual Fund Conflict of Interest Investment Restrictions, each Fund would be prohibited from knowingly making or holding an investment in an Underlying ETF if the Fund, alone or together with one or more related mutual funds, would be a substantial security holder of the Underlying ETF.

17. Furthermore, Invesco may at times have a seed capital investment in an Underlying ETF which would represent a significant interest in that fund. As Invesco is a substantial security holder of the Filer, which is the manager of the Funds, the Mutual Fund Conflict of Interest Investment Restrictions would further prohibit a Fund from investing in an Underlying ETF at a time where Invesco would hold a significant interest in that fund.

18. In the absence of an exemption from the Mutual Fund Conflict of Interest Reporting Requirements, the Filer would be required to file a report of every transaction by a Fund involving securities of an Underlying ETF, as well as a report of every transaction in which, by arrangement, a Fund and an Underlying ETF would be acting as joint participants.

19. The Funds' investment in securities of the Underlying ETFs will represent the business judgment of responsible persons uninfluenced by considerations other than the best interests of the Funds.

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 the Funds' investments in securities of the Underlying ETFs are made in compliance with the requirements of section 2.5 of NI 81-102, as modified by the NI 81-102 Exemption.

Templeton International Stock Fund - MRRS Decision

Headnote

MRRS- exemptive relief from the matching requirement in paragraph 15.3(4)(c) of National Instrument 81-102 -- Mutual Funds -- Relief exempting the applicants from the requirement to publish performance and ranking rating, as produced by a specified rating agency, that conforms to the "since inception" period (as applicable) of standard performance data -- Relief granted to applicants and other funds wishing to publish the ratings of the specified rating agency.

Applicable Legislative Provisions

National Instrument 81-102 Mutual Funds, ss. 15.2(1)(a), 15.3(4)(c), 15.8, 19.1(1).

May 14, 2008

IN THE MATTER OF

THE SECURITIES LEGISLATION OF

BRITISH COLUMBIA, ALBERTA, SASKATCHEWAN,

MANITOBA, ONTARIO, QUEBEC, PRINCE EDWARD

ISLAND, NEW BRUNSWICK, NOVA SCOTIA,

NEWFOUNDLAND AND LABRADOR, NORTHWEST

TERRITORIES, YUKON AND NUNAVUT

(the "Jurisdictions")

AND

IN THE MATTER OF

THE MUTUAL RELIANCE REVIEW SYSTEM

FOR EXEMPTIVE RELIEF APPLICATIONS

AND

IN THE MATTER OF

TEMPLETON INTERNATIONAL STOCK FUND

(the "Fund")

MRRS DECISION DOCUMENT

Background

The local securities regulatory authority or regulator (the "Decision Maker") in each of the Jurisdictions has received an application (the "Application") from Franklin Templeton Investments Corp. (the "Filer") on behalf of the Fund and other Canadian mutual funds that are governed by National Instrument 81-102 Mutual Funds ("Other Funds") that wish to publish Lipper Leader Ratings and refer to Lipper Awards, as defined below, produced through the use of the Lipper Leader Methodology, as defined below, in sales communications for a decision under the securities legislation of the Jurisdictions (the "Legislation") that the Fund and the Other Funds are exempted from the requirement contained in paragraph 15.3(4)(c) of National Instrument 81- 102 Mutual Funds so as to permit the Fund and Other Funds to publish in a sales communication the Lipper Leader Ratings and refer to such awards for certain periods for which standard performance data is required to be given (the "Requested Relief").

Under the Mutual Reliance Review System ("MRSS") for Exemptive Relief Applications

(a) the Ontario Securities Commission is the principal regulator for this application; and

(b) this MRRS decision document evidences the decision of each Decision Maker.

Interpretation

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

Representations

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

1. The Filer is the manager of the Fund. The head office of the Filer is in Ontario.

2. The Fund is an open-ended mutual fund trust established under the laws of Ontario. Units of the Fund are offered on a continuous basis in each of the Jurisdictions pursuant to a simplified prospectus dated June 12, 2007 as amended.

3. The Filer wishes to include in sales communications of the Fund certain ratings of its performance (the "Lipper Leader Ratings") determined on the proprietary rating methodology prepared and provided by Lipper, Inc. ("Lipper") (the "Lipper Leader Methodology"), which sales communications will not strictly comply with the requirement in paragraph 15.3(4)(c) of National Instrument 81-102 Mutual Funds ("NI 81-102"), which requires that the ratings that are published be provided for, or "match", each period for which standard performance data is required to be given (the "Matching Requirement"). Other Funds similarly wish to publish Lipper Leader Ratings in sales communications. The Fund and Other Funds may also wish, from time to time, to include in their sales communication disclosure of any awards awarded to them by Lipper (the "Lipper Awards"), as described below.

4. Lipper is a rating agency that is not a member of the organization of the Fund or of the Other Funds. The Fund and Other Funds may make reference to the Lipper Leader Ratings or Lipper Awards in sales communication subject to the terms of a license agreement with Lipper.

5. In accordance with the requirements of section 15.8 of NI 81-102, standard performance data in sales communications for mutual funds is required for the following periods (as applicable): one year, three years, five years, 10 years, and since inception if the mutual fund has been offering securities by way of simplified prospectus for more than one and less than 10 years.

6. The Lipper Leader system is a toolkit that uses investor-centered criteria to deliver a simple, clear description of a fund's success in meeting certain goals, such as preserving capital or building wealth through consistent, strong returns. Lipper Leader Ratings are designed to be used in conjunction with each other to effectively identify funds that meet the particular characteristics sought by investors. The basis of generating Lipper Leader Ratings is consistent from mutual fund to mutual fund and captures a quantitative assessment of a mutual fund's past-risk-adjusted return, presented related to its category.

7. Lipper Leader Ratings are derived from formulas that analyze funds against clearly defined criteria. Funds are compared to similar funds, and only those that truly stand out are awarded Lipper Leader status. Funds are ranked against their peers on each of three measures: Total Return, Consistent Return and Preservation.

8. The Lipper Leader Ratings provide ratings for the following periods (as applicable): one-year (for mutual funds with a three-year history), three years, five years, ten years, and the overall rating (the "Overall Rating"), which is a un-weighted average of the previous three periods. If only five years of history are available, the three-year and five-year periods are averaged. If only three years of data are available, the three-year statistics alone are used. Mutual funds less than three years old are not rated and accordingly are not included in the applicable category. For each measure, the highest 20% of funds in each peer group are named Lipper Leaders. The next 20% receive a score of 4; the middle 20% are scored 3; the next 20% are scored 2, and the lowest 20% are scored 1.

9. Lipper also awards to appropriate funds the Lipper Awards pursuant to the Lipper Fund Awards program that highlights funds that have excelled in delivering consistently strong risk adjusted performance, relative to peers. The Lipper Awards are funds and fund families being ranked 1st in the Consistency Lipper Leader Rating. Lipper designates award-winning funds in most individual classifications for the three-, five- and ten-year periods. In addition, the Lipper Fund Awards program spotlights fund families with high average scores for all funds within a particular asset class or overall.

10. The Lipper Leader Ratings do not provide a "since inception" period rating, since a "since inception" period is not accommodated within the Lipper Leader Methodology. Any period that runs from the inception of the mutual fund in question will, by definition, create a host of different periods for mutual funds within the same category. This undermines the comparability of the resulting information, which is an issue for any rating of performance, not just the Lipper Leader Methodology. Accordingly, a Lipper Leader Rating cannot be presented on a complete matching basis with the standard performance data periods. Any changes made to the Lipper Leader Methodology in these regards would undermine the integrity and rigour of the Lipper Leader Rating.

11. The categories against which the Fund and Other Funds are ranked by Lipper are the categories maintained by the Investment Funds Standards Committee ("IFSC") (www.cifsc.com), a Canadian organization that is independent of Lipper, or a successor to the CIFSC from time to time.

12. In order that the Fund and the Other Funds' sales communications more closely comply with the Matching Requirements, Lipper has agreed to calculate and provide a one year rating for mutual funds that have at least 3 years of performance history.

13. Given that the Lipper Leader Methodology does not include a since inception rating, the Fund and Other Funds wish to be exempt from the requirement to publish such rating in accordance with the Matching Requirement.

14. The absence of the since inception rating in sales communications, as well as the addition therein of the Overall Rating or disclosure of Lipper Awards would not be misleading to investors contrary to clause 15.2(1)(a) of NI 81-102. The Fund and the Other Funds will otherwise comply with the Matching Requirement when making reference to Lipper Leader Ratings or Lipper Awards in sales communications.

15. In the absence of this Decision, the fund managers would be prohibited from publishing the Lipper Leader Ratings for their funds in sales communications given that the Lipper Leader Ratings, while substantially complying with the Matching Requirements, fall short of technical compliance.

16. Lipper Awards are performance ranking, and, for the reasons described above in respect of the Lipper Leader Ratings, would not be prepared in technical compliance with the Matching Requirements.

Decision

Each of the Decision Makers is satisfied that the test contained in the Legislation that provides the Decision Makers with the jurisdiction to make the decision has been met.

The decision of the Decision Makers under the Legislation is that the Requested Relief is granted such that

(i) the Fund and Other Funds are not required to publish Lipper Leader Ratings or refer to Lipper Awards that correspond to the "since inception" period of standard performance data; and

(ii) the Fund and Other Funds may publish Lipper's Overall Rating in sales communications alongside other Lipper Leader Ratings, or refer to Lipper Awards, that correspond to the one, three, five and 10-year periods, as applicable, for which standard performance data is required to be given,

provided that:

1) for Other Funds who wish to rely on this decision to publish in a sales communication the Lipper Leader Ratings and refer to Lipper awards, the manager of their mutual fund families, file an advance written notice with the Director of the Investment Funds Branch of the Ontario Securities Commission that:

(a) names the mutual fund family, and

(b) confirms that the mutual fund family has agreed to the conditions of this decision;

2) the sales communication of the Fund or Other Fund that contains the Lipper Leader Ratings or refers to Lipper Fund Awards complies with Part 15 of NI 81-102 and contains the following disclosure in at least 10 point type:

(a) the name of the category within which the Fund or the Other Fund is rated;

(b) the number of mutual funds in the applicable category for each required standard performance period;

(c) the name of the ranking entity, i.e. Lipper;

(d) the length of period and the ending date, or, the first day of the period and the ending date on which the Lipper Leader Ratings or the Lipper Fund Award is based;

(e) a statement that the Lipper Leader Methodology is subject to change every month;

(f) a brief overview of the Lipper Leader Methodology, including what return/risk measures it takes into account;

(g) disclosure of the meaning of the Lipper Leader Ratings from 1 to 5 (e.g. ranking of 5 indicates fund is in top 20% of its category.)

(h) reference to Lipper's website (www.lipperweb.com) for greater detail on the calculation of the Lipper Leader Ratings or the awarding of the Lipper Awards;

3) if the sales communication of the Fund or Other Fund also includes the Overall Rating, the Overall Rating is to the most recent calendar month end that is not more than 45 days before the date of the appearance or use of the advertisement in which it is included, and not more than three months before the date of first publication of any other sales communication in which it is included;

4) if the sales communication of the Fund or Other Fund makes reference to the Lipper Awards, the Lipper Awards must not have been awarded more than 365 days before the date of the sales communication;

5) the Lipper Leader Ratings or Lipper Awards provided or described in a sales communication of the Fund or Other Fund are calculated based on comparisons of performance of investment funds within a specified category established by CIFSC;

6) the corresponding Lipper Leader Rating that the Lipper Awards are derived from must be provided along with the Lipper Awards, when the Lipper Awards are referred to in a Sales Communication; and

7) this decision, as it relates to the Jurisdiction of a Decision Maker, will terminate in that Jurisdiction one year after the publication in final form of any legislation or rule of that Decision Maker which modifies the provisions of section 15.2(4) of NI 81-102 in a manner which makes the relief provided for in this decision unnecessary or provides similar relief on a different basis or subject to different conditions.

University of Western Ontario - MRRS Decision

Headnote

Mutual Reliance Review System for Exemptive Relief Applications -- Relief provided pursuant to section 74(1) of the Act for relief from the prospectus and registration requirements to permit former pension plan member as part of a related registered retirement income fund (RRIF) program to invest in mutual funds that were permitted investments under the pension plan.

Applicable Legislative Provisions

Securities Act (Ontario), ss. 25, 53, 74(1).

May 23, 2008

IN THE MATTER OF

THE SECURITIES LEGISLATION OF

BRITISH COLUMBIA, ALBERTA, SASKATCHEWAN,

MANITOBA, ONTARIO, QUÉBEC, NOVA SCOTIA,

NEW BRUNSWICK, PRINCE EDWARD ISLAND,

NEWFOUNDLAND AND LABRADOR, THE YUKON

TERRITORY, THE NORTHWEST TERRITORIES

AND NUNAVUT

AND

IN THE MATTER OF

THE MUTUAL RELIANCE REVIEW SYSTEM

FOR EXEMPTIVE RELIEF APPLICATIONS

AND

IN THE MATTER OF

THE UNIVERSITY OF WESTERN ONTARIO

("UWO")

MRRS DECISION DOCUMENT

Background

The securities regulatory authority or regulator (the "Decision Maker") in each of British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Québec, Nova Scotia, New Brunswick, Prince Edward Island, Newfoundland and Labrador, the Yukon Territory, the Northwest Territories and Nunavut (collectively, the "Jurisdictions") has received an application from UWO for a decision pursuant to the securities legislation in each of the Jurisdictions (collectively, the "Legislation") that certain trades made in connection with the UWO registered retirement income fund program (the "UWO RRIF Program") be exempted from the prospectus and registration requirements under the applicable Legislation.

Under National Policy 12-201 -- Mutual Reliance Review System for Exemptive Relief Applications (the "MRRS"):

(a) the Ontario Securities Commission is the principal regulator for this application; and

(b) this MRRS decision evidences the decision of each Decision Maker.

Interpretation

Defined terms contained in National Instrument 14-101 -- Definitions have the same meaning in this decision unless they are otherwise defined in this decision.

Representations

1) UWO is a Canadian university located in London, Ontario and established in 1878. UWO has an enrolment of approximately 30,000 students and employs approximately 4,500 full-time faculty and staff.

2) UWO is not a reporting issuer in any of the Jurisdictions.

3) UWO previously obtained relief in Ontario by way of order dated May 9, 2000 (the "Original Ruling") from the prospectus and registration requirements in the securities legislation of Ontario exempting certain trades in connection with the-then proposed UWO RRIF Program, provided that the UWO RRIF Program operated pursuant to certain conditions set out in the Original Ruling (the "Ruling Conditions").

4) The Original Ruling provides that the ruling "...shall terminate upon any amendment or withdrawal of Rule 32-503 -- Registration and Prospectus Exemptions for Trades by Financial Intermediaries in Mutual Fund Securities to Corporate Sponsored Plans." ("Rule 32-503"). On September 14, 2005, the OSC revoked Rule 32-503 and the substance of the rule was incorporated verbatim into Section 3.2 of revised OSC Rule 45-501 -- Ontario Prospectus and Registration Exemptions ("Rule 45-501"). Section 3.2 of Rule 45-501 remains in force, unamended, as of the date hereof. As a result of the revocation of Rule 32-503, the Original Ruling has terminated and has necessitated this Application for exemptive relief in Ontario. In addition, the Original Ruling was limited in scope to an exemption from Ontario securities legislation. Subsequent to the Original Ruling and the establishment of the UWO RRIF Program, UWO has determined that certain of the RRIF Investors now reside in Jurisdictions other than Ontario.

5) The Requested Relief is necessary in Ontario as the 'sunset' provision of the Original Ruling was triggered by the reformulation of Ontario prospectus and registration exemptions into single national and local instruments. In addition, UWO is seeking to (i) obtain relief similar to the Original Ruling in each of the Jurisdictions to permit the UWO RRIF Program to be made available to eligible persons in Jurisdictions other than Ontario, and (ii) to modify the relief granted in the Original Ruling to permit UWO to extend certain investor education programs to participants in the UWO RRIF Program.

6) The Original Application set out the facts surrounding two pension plans (the "Pension Plans") established and administered by UWO for Plan Members (as defined below) as well as the then-proposed UWO RRIF Program.

7) The UWO RRIF Program was established on December 1, 2000 and allows former Plan Members (the "RRIF Investors") an opportunity to establish a registered retirement income fund (an "RRIF") through which they may continue to invest their assets formerly held in the Pension Plans in certain of the investment opportunities in which they were permitted to allocate their assets when they were Plan Members.

8) The Pension Plans are each registered as a pension plan under the Pension Benefits Act, R.S.O. 1990, c. L.25, as amended (the "Pension Benefits Act") and are each also registered pension plans within the meaning of the Income Tax Act, R.S.C., (5th Supp.), c. 1, as amended (the "Income Tax Act"). The Pension Plans' management and administration are each supervised by a committee of Plan Members and UWO administration (the "Pension Boards").

9) The Pension Plans primarily provide benefits on a "defined contribution" basis, but there remain some Plan Members that are eligible for payments on a "defined benefit" basis. Participation in the UWO RRIF Program is limited to former Plan Members whose pension entitlement has been determined on a "defined contribution" basis.

10) Eligible employees of UWO are entitled to participate in the Pension Plans, as are, in certain circumstances, the surviving spouses of such employees and former spouses of such employees upon a marriage breakdown (such eligible employees, surviving spouses and former spouses collectively referred to herein as the "Plan Members").

11) Contributions to the Pension Plans made in respect of a Plan Member are recorded in the Plan Member's pension account and transmitted to the Northern Trust Company, Canada (the "Plan Trustee") which has been appointed by UWO to act as trustee and custodian of a master trust and the two participating trusts (the "Pension Funds") that hold the Pension Plans' assets. The Plan Trustee is a federally incorporated trust company registered under the Loan and Trust Corporations Act, R.S.O. 1990, c. L.25, as amended.

12) The assets comprising the Pension Funds are allocated among a series of "sub-funds" (the "Unit Funds"). The Pension Boards have engaged a number of third party investment managers (the "Managers") to direct the investment of the Unit Funds' assets according to investment mandates determined by the Pension Boards. Plan Members direct the proportional investment of their accounts among such Unit Funds based on their individual preferences.

13) Each of the Managers or one of their respective affiliates is registered in Ontario under the Securities Act (Ontario) (the "Act") as an advisor in the sub-categories of investment counsel and portfolio manager. All action taken by a Manager in respect of a Unit Fund is either done directly by such Manager where such Manager is registered under the Act as an advisor or by an affiliate of such Manager that is registered in Ontario under the Act as an advisor.

14) Each Manager directs how the assets of the relevant Unit Fund should be invested. All trades in connection with the Unit Funds are effected by the Plan Trustee through a registered dealer (or pursuant to an exemption from applicable dealer registration requirements), the relevant Managers or through such Managers' registered affiliates.

15) Under the Income Tax Act's regulations that govern pension plans, Plan Members must, by the end of the year in which they reach the age of 71, transfer their account balances out of the Pension Plans (however, the rules of the Pension Plans currently require that Plan Members transfer account balances by the end of the year in which they reach the age of 69). These account balances may only be transferred to certain types of investment vehicles prescribed by the Pension Benefits Act ("Prescribed Accounts").

16) The Pension Plans are managed and administered in accordance with the Guidelines for Capital Accumulation Plans (the "CAP Guidelines") published by the Joint Forum of Financial Market Regulators. The CAP Guidelines set out the expectations of Canadian regulators regarding the operation of a capital accumulation plan, regardless of the regulatory regime applicable to the plan and, among other things, ensure that participants in capital accumulation plans are provided the information and assistance that they need to make investment decisions in a capital accumulation plan.

17) The UWO RRIF Program operates in parallel with the Pension Plans. The investment alternatives available to RRIF Investors under the UWO RRIF Program are a subset of the Unit Funds available under the Pension Plans. Accordingly, investments in the UWO RRIF Program are managed the same way as Plan Members' pension assets are managed under the Pension Plans.

18) The UWO RRIF Program operates at all times in compliance with the Ruling Conditions set out in the Original Ruling and the facts and representations regarding the UWO RRIF Program set out in the Original Application continue to be true and correct in all material respects.

19) Plan Members may, on or after their withdrawal from the Pension Plans, elect to establish a registered retirement income fund (a "UWO RRIF") under the UWO RRIF Program. RRIF Investors may invest only in a subset of the Unit Funds that are offered to Plan Members under the Pension Plans (the "RRIF Funds").

20) Each UWO RRIF holds only securities of the RRIF Funds, however RRIF Investors are entitled to reallocate their investment from any particular RRIF Fund to another RRIF Fund available through the UWO RRIF Program. RRIF Investors have no right to receive the underlying securities held by the RRIF Funds or transfer the securities of the RRIF Funds out of their UWO RRIF.

21) A RRIF Investor may only contribute to his or her UWO RRIF by "rolling-over" (i) assets that were previously held for such investor's benefit in the Pension Plans, or (ii) assets that were previously held for such investor's benefit in a Prescribed Account that had previously been "rolled over" from the Pension Plans (or from another such Prescribed Account) (collectively, "Plan Assets").

22) In directing the allocation of their contributions among the RRIF Funds, RRIF Investors deal exclusively with their own investment advisors and employees of the UWO ("UWO Staff"). UWO Staff act as registrars for the UWO RRIF Program, maintaining records of RRIF Investors' investment directions, net redemptions or acquisitions of interests in the Unit Funds, interfund transfers and benefit payments. UWO Staff also provide information relating to fund performance and general principles governing the selection of funds in investment booklets, monthly newsletters, individual sessions and through a pensions website. RRIF Investors do not interact either with the Plan Trustee, the Managers or affiliates of the Managers that effect trades on behalf of the RRIF Investors.

23) Each UWO RRIF is qualified as an RRIF under the Income Tax Act and is a Prescribed Account under the Pension Benefits Act.

24) The Plan Trustee acts as custodian (the "Custodian") and trustee (the "Trustee") of each UWO RRIF as it does for the Pension Plans and the RRIF Funds.

25) The UWO RRIF Program is managed and administered in accordance with the CAP Guidelines.

26) Proposed amendments to National Instrument 45-106 -- Prospectus and Registration Exemptions (NI 45-106) related to Capital Accumulation Plans were published by the Canadian Securities Administrators on October 21, 2005 and adopted in the form of a blanket exemption in each of the provinces and territories other than the Jurisdictions. Such proposal (the "CAP Exemption") contemplates both a dealer registration exemption and a prospectus exemption.

27) The UWO RRIF Program cannot rely on the CAP Exemption as, among other things, it does not comply with section 2.2(b) of the CAP Exemption in that the RRIF Funds are not subject to, and do not comply with, Part 2 of National Instrument 81-102 Mutual Funds.

28) In connection with the Pension Plans only, UWO makes available to Plan Members certain general information about the Pension Plans and Unit Funds and broad financial planning issues (the "Education Program") provided by The Financial Education Institute of Canada (the "Education Provider"). The Education Program has two components:

(a) Plan Members may participate in a series of workshops presented by the Education Provider that cover a broad range of topics, including specific matters relating to the Pension Plans (such as making pension contributions, options on termination of employment or retirement, overview of available asset classes under the Pension Plans, the benefits of an RRIF) but also regarding more general investment matters (such as investment basics, evaluating investment fund performance and sources of assistance with investment decisions); and

(b) Plan Members may access "The Financial Educator", a password-protected interactive website operated by the Education Provider, which provides financial planning information and resources including financial calculators, resources on choosing a financial advisor and a glossary of financial terms.

29) The Education Provider is a private, independent provider of educational services, that does not sell financial investments or provide advice regarding specific investment products. The Education Provider is compensated on a flat fee basis based on the number of participants that have access to the Education Program, not based on any trading activity or investment choices made by Plan Members.

30) UWO has not previously made the Education Program available to RRIF Investors as paragraph (a) of the Ruling Conditions specifies that RRIF Investors "deal only with UWO in respect of their participation in the UWO RRIF and the allocation of investment of the Pension Assets" in the RRIF Funds.

31) Eligible employees of UWO participating in the Pension Plans prior to their retirement are necessarily resident in Ontario. However, subsequent to the Original Ruling and the establishment of the UWO RRIF Program, UWO has determined that some RRIF Investors now reside in Jurisdictions other than Ontario.

32) As of December 3, 2007, 16 of 324 RRIF Investors were located in Jurisdictions other than Ontario; 11 in British Columbia, two in Nova Scotia and one each in Alberta, Manitoba and New Brunswick.

33) Other than participation by RRIF Investors that were formerly resident in Ontario and have taken up residence in another Jurisdiction, the UWO RRIF Program does not operate in Jurisdictions outside Ontario.

Decisions

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.

The decision of the Decision Makers pursuant to the Legislation is that exemptive relief is granted to UWO, the Trustee, the Custodian and RRIF Investors from the prospectus and registration requirements under applicable Legislation for trading in connection with the UWO RRIF Program, provided that:

(a) RRIF Investors deal only with UWO or, in respect of the Education Program, the Education Provider, in respect of their participation in the UWO RRIF Program and the allocation of the investment of the assets in the RRIF Funds;

(b) each of the Trustee and the Custodian is a trust corporation registered as required, under the applicable legislation of each of the Jurisdictions;

(c) RRIF Investors do not invest any money in the UWO RRIF Program other than assets from the Pension Plans;

(d) the RRIF Funds are managed and administered in substantially the same way as the Unit Funds; and

(e) each Manager is registered as an advisor under the Act or is exempt from registration under Ontario securities legislation,

provided that this Decision shall terminate on the later of December 31, 2011 and the date that is six months after the coming into force of a national or multilateral instrument of the Decision Makers that concerns prospectus and registration exemptions relating to pension plans, deferred profit sharing plans, retirement savings plans or other similar capital accumulation plans maintained by the sponsor of the plan for its employees.

AldeaVision Solutions Inc.

Headnote

National Policy 11-203 Process For Exemptive Relief Applications in Multiple Jurisdictions - Application by an issuer for a decision that it is not a reporting issuer - issuer has no publicly-held securities - exemptive relief sought granted.

Applicable Legislative Provisions

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

(Translation)

May 23, 2008

IN THE MATTER OF

THE SECURITIES LEGISLATION OF

QUEBEC, ONTARIO, MANITOBA,

SASKATCHEWAN, ALBERTA, NEW BRUNSWICK,

NOVA SCOTIA, PRINCE EDWARD ISLAND,

NEWFOUNDLAND AND LABRADOR

(the "Jurisdictions")

AND

IN THE MATTER OF

THE PROCESS FOR EXEMPTIVE RELIEF

APPLICATIONS IN MULTIPLE JURISDICTIONS

AND

IN THE MATTER OF

ALDEAVISION SOLUTIONS INC.

(the "Filer")

DECISION

Background

The securities regulatory authority or regulator of the Jurisdiction (the "Decision Maker") has received an application from the Filer for a decision under the securities legislation of the Jurisdictions (the "Legislation") that the Filer is not a reporting issuer in each of the Jurisdictions (the "Exemptive Relief Sought").

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

(a) the Autorité des marchés financiers (the "AMF") is the principal regulator for this application, and

(b) the decision is the decision of the principal regulator and evidences the decision of each other Decision Maker.

Interpretation

Terms defined in Regulation 14-101 respecting Definitions (and elsewhere, National Instrument 14-101 Definitions) have the same meaning if used in this decision, unless otherwise defined.

Representations

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

1. The Filer is a corporation organized under the Canada Business Corporations Act (the "CBCA") with its head office in St-Laurent, Quebec.

2. The Filer has an authorized share capital consisting of an unlimited number of common shares, of Class A preferred shares and of Class B preferred shares. Currently there are 3,570,000 common shares issued and outstanding (the "Common Shares").

3. The Filer is a reporting issuer in each of the Jurisdictions for over ten years. Currently, the Filer is not in default of any of its obligations under the Legislation as a reporting issuer, other than its obligation to file its annual financial statements for the years ended December 31, 2006 and December 31, 2007 and its Management Discussion and Analysis in respect of such financial statements, its interim financial statements for the periods ended January 31, 2007, June 30, 2007 and September 30, 2007 and its Management Discussion and Analysis in respect of such financial statements; all as required under the National Instrument 51-102, Continuous Disclosure Obligations and the related certification of such financial statements as required under Multilateral Instrument 52-109, Certification of Disclosure in Issuers' Annual and Interim Filings.

4. The Filer is a provider of international video transmission services.

5. On December 20, 2007, the Filer obtained an order (the "Order") from the Quebec Superior Court sanctioning a plan of arrangement and reorganization (the "Plan") pursuant to the Companies' Creditors Arrangement Act (the "CCAA") and the CBCA.

6. The ultimate result of the Plan and the Order was to reduce the number of shareholders of the Filer to three, namely: (i) Capital Régional et Coopératif Desjardins (155,915 Common Shares); (ii) Desjardins Capital de Développement Montréal Métropolitain, Ouest et Nord du Québec Inc. (14,085 Common Shares); and (iii) Almiria Capital Corp. (3,400,000 Common Shares).

7. The Filer's securities were delisted from the TSX Venture Exchange on January 25, 2008; therefore, no securities of the Filer are traded on a marketplace as defined in National Instrument 21-101, Marketplace Operation.

8. The Filer has no current intention to seek public financing by way of an offering of securities.

9. The Filer applied to voluntarily surrender its status as a reporting issuer in British Columbia under BC Instrument 11-502 Voluntary Surrender of Reporting Issuer Status. The Filer ceased to be a reporting issuer in British Columbia on April 9, 2008 and the cease trade order in British Columbia was revoked on April 11, 2008.

10. The Filer has applied for relief in order to cease to be a reporting issuer in all of the jurisdictions in which it is currently a reporting issuer.

11. The Filer is currently the object of a cease trade order in Manitoba, Ontario and Québec.

12. The Filer, upon the grant of the Exemptive Relief Sought, will not be a reporting issuer or the equivalent in any jurisdiction in Canada. The cease trade orders will be revoked concurrently.

Decision

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 Exemptive Relief Sought is granted.

Pan African Mining Corp.

Headnote

National Policy 11-203 Process For Exemptive Relief Applications in Multiple Jurisdictions - Issuer owns mining properties indirectly; Issuer proposes to enter into arrangement with third party to spin-off non-material mining properties into new company ("Newco"); After spin off, shareholders of Issuer to receive cash from third party and shares of Newco in exchange for shares of Issuer; One mining property will become material in Newco; Newco to become reporting issuer upon closing of the arrangment; Issuer required to provide information circular to shareholders to vote on the arrangement under section 4.2(c) of NI 43-101; Information circular must contain prospectus-level disclosure under section 14.2 of Form 51-102F5.

Relief requested from requirement to include prospectus-level disclosure about the material mining property in Newco and from the requirement to file a technical report for the same property, Issuer's shareholders currently hold an indirect interest in all Newco properties and will continue to hold indirect interest following completion of the arrangement; a technical report for Newco's only material property will be filed on SEDAR five days before completion of the arrangement.

Relief requested to allow venture issuer disclosure for MD&A based on Issuer's current status as a venture issuer.

Applicable Legislative Provisions

National Instrument 43-101 Standards of Disclosure for Mineral Projects, ss. 4.2(1)(c), 9.1.

National Instrument 51-102 Continuous Disclosure Obligations, s. 13.1.

Form 51-102F5 Information Circular, s. 14.2.

Form 41-101F1 Information Required in a Prospectus, items 5.4, 8 and 35.

Securities Act, R.S.O. 1990, c. S.5, as am.

May 23, 2008

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

PAN AFRICAN MINING CORP.

(the Filer)

DECISION

Background

1 The securities regulatory authority or regulator in each of the Jurisdictions (the Decision Maker) has received an application (the Application) from the Filer for a decision under the securities legislation of the Jurisdictions (the Legislation) that the Filer is exempt from:

(a) the requirement in National Instrument 43-101 Standards of Disclosure for Mineral Projects (NI 43-101) to file a technical report in connection with an information circular concerning the acquisition of mineral properties by a new entity formed in connection with an arrangement; and

(b) certain requirements in National Instrument 51-102 Continuous Disclosure Obligations (NI 51-102) to provide certain prospectus level disclosure required by Form 41-101F1 in the information circular to be prepared and mailed to the Filer's securityholders in connection with a special meeting to consider a plan of arrangement, specifically:

(i) the requirement in item 5.4 regarding disclosure of information about mining properties,

(ii) the requirements in item 8 to allow the Filer to provide management discussion and analysis for a venture issuer even though Newco (as defined below) is technically not a venture issuer, and

(iii) the requirements in item 35 to provide significant acquisition disclosure

(the Exemption Sought);

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 the Province of Alberta; 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 and MI 11-102 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 was incorporated under the Company Act (British Columbia) on October 1, 2002;

2. the Filer is a reporting issuer in each of the Jurisdictions and in Alberta and is not in material default of any of the requirements of the securities laws of such jurisdictions;

3. the authorized share capital of the Filer consists of 100,000,000 preferred shares (Preferred Shares) and 100,000,000 common shares (Common Shares), of which, as at May 19, 2008, no Preferred Shares and 30,927,792 Common Shares were issued and outstanding;

4. the Common Shares are listed and posted for trading on the TSX Venture Exchange;

5. the Filer and its subsidiaries hold interests in certain mineral properties located in Mozambique, Botswana, Namibia and Madagascar;

6. the Filer owns shares of EnerMad Corp. and has the following subsidiaries in Madagascar:

(a) PAM Madagascar S.A.R.L.;

(b) PAM Atomique S.A.R.L.; and

(c) Pam Sakoa S.A.

(which three last mentioned companies are referred to collectively as the Madagascar Subsidiaries),

and the three last mentioned companies hold interests in certain mineral properties located in Madagascar (the Madagascar Properties);

7. the Filer has the following subsidiaries outside of Madagascar:

(a) PAM Botswana (Pty) Ltd.;

(b) PAM Minerals Namibia (Pty) Ltd.;

(c) PAM Mocambique Limitada;

(collectively, the Non-Madagascar Subsidiaries),

and Filer and the three last mentioned companies, directly or indirectly, hold interests in certain mineral properties located outside of Madagascar including joint ventures with Manica Minerals Ltd., African Eagle Resources plc and Bobcat Mining Limitada (the Non-Madagascar Properties);

8. the Filer has filed technical reports in respect of four of the Madagascar Properties;

9. the Filer's Non-Madagascar Properties have not been material to the Filer and are at very early (grassroots) stages of development, and technical reports have not yet been completed in respect of these properties;

10. on April 10, 2008, the Filer was notified by Asia Thai Mining Co., Ltd. (ATM) that ATM intended, through a wholly owned subsidiary of ATM, to make an unsolicited take-over bid at the price of $3.40 cash per Common Share;

11. the Filer and ATM began negotiations and have entered into an arrangement transaction (the Arrangement) whereby:

(a) the Filer's Non-Madagascar Subsidiaries will be 'spun off' from the Filer to a new entity (Newco) which will receive from the Filer:

(i) $2,500,000 in cash; and

(ii) all of the assets and liabilities directly related to the Filer's Non-Madagascar Subsidiaries, including all of the Filer's direct and indirect and joint venture interests in the Non-Madagascar Properties;

(b) the Offeror will acquire all of the issued and outstanding Common Shares of the Filer at a price of $4.00 per Common Share and acquire all of the Filer's outstanding warrants (the Warrants) and stock options (vested and not yet vested) (the Options) at a price equal to the difference between $4.00 and the exercise price of the respective Warrant or Option (collectively, the Cash Consideration); and

(c) in addition to the Cash Consideration, holders of Common Shares as at the closing of the Arrangement will also ultimately receive one common share of Newco (the Newco Shares) for each Common Share previously held in the Filer (the Share Consideration);

12. the Newco Shares will not be listed on any stock exchange for at least 30 days following completion of the Arrangement;

13. ATM is not a reporting issuer in any jurisdiction of Canada;

14. the Filer has called a special meeting (the Meeting) of the Pan African Securityholders (defined below), to be held on or about June 20, 2008; at the Meeting, Pan African Securityholders will be asked to vote on the Arrangement; at the Meeting, each holder of Common Shares will be entitled to one vote for each Common Share held and each holder of Options (the Pan African Optionholders) and each holder of Warrants (the Pan African Warrantholders) will be entitled to one vote for each common share of Pan African underlying such Option or Warrant;

15. under the Legislation, the Filer is required to prepare and mail a management information circular (the Pan African Circular) to Pan African Shareholders, Pan African Optionholders and Pan African Warrantholders (together, the Pan African Securityholders) not less than 21 days plus 4 business days before the Meeting;

16. the Pan African Circular will include a fairness opinion of Union Securities Ltd. in relation to the fairness, from a financial point of view, of the Arrangement to the Pan African Securityholders;

17. under NI 51-102, the Filer is required to prepare the information circular in the required form, including disclosure in respect of Newco prescribed in the form of prospectus that Newco would be eligible to use immediately prior to the sending and filing of the Pan African Circular, which is Form 41-101F1, including certain audited annual and unaudited interim financial statements of Newco and the Non-Madagascar Subsidiaries, management discussion and analysis of those annual and interim financial statements and certain mineral project and significant acquisition disclosure;

18. under NI 43-101, the Filer is required to file a technical report to support scientific or technical information on any property material to Newco contained in the Pan African Circular because Newco is issuing securities as consideration for the Non-Madagascar Subsidiaries;

19. the Filer has not yet completed any technical reports in respect of the Non-Madagascar Properties because they are not material to the Filer, but some may be considered material for Newco;

20. the Pan African Securityholders currently hold an indirect interest in the Non-Madagascar Properties through their ownership in securities of Pan African; following completion of the Arrangement, the Pan African Securityholders will still own an indirect interest in the Non-Madagascar Properties through their ownership of the Newco Shares;

21. section 35 of Form 41-101F1 requires the inclusion of financial statements of the Non-Madagascar Subsidiaries;

22. the Filer will include the following information in the Pan African Circular:

(a) audited financial statements for Newco and the Non-Madagascar Subsidiaries, on a combined basis, as at September 30, 2007 with comparative figures to September 30, 2006 and related management discussion and analysis as required for a venture issuer, and

(b) unaudited financial statements of Newco and the Non-Madagascar Subsidiaries, on a combined basis, as at March 31, 2008 with comparative figures to March 31, 2007 and related management discussion and analysis as required for a venture issuer;

23. the Filer will, and will cause Newco to, file on SEDAR at least five business days before closing of the Arrangement a technical report as required by section 4.1 of NI 43-101 in respect of one of the diamond properties in Botswana, which will be considered a material property of Newco.

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 decisions of the Decision Makers under the Legislation is that the Exemption Sought is granted.

Desjardins Global Asset Management Inc. - MRRS Decision

Headnote

Mutual Reliance Review System for Exemptive Relief Applications -- Relief granted to permit portfolio managers, on behalf of certain funds, to purchase and sell mortgages from and to affiliates of the portfolio manager -- Section 7.2 of National Instrument 81-107 Independent Review Committee for Investment funds causes prior relief to expire on November 1, 2007 -- New relief now issued on revised conditions which contemplate IRC approval. Relief also granted to permit alternative reporting of related party transactions.

Applicable Legislative Provisions

Securities Act (Ontario), ss. 117(1)(a), 117(1)(c), 118(2), 121(2)(a)(ii).

Ontario Regulation 1015 General Regulation, s. 115(6).

May 14, 2008

IN THE MATTER OF

THE SECURITIES LEGISLATION OF

BRITISH COLUMBIA, ALBERTA, SASKATCHEWAN,

ONTARIO, NEW BRUNSWICK, NOVA SCOTIA

AND NEWFOUNDLAND AND LABRADOR

(the Jurisdictions)

AND

IN THE MATTER OF

THE MUTUAL RELIANCE REVIEW SYSTEM

FOR EXEMPTIVE RELIEF APPLICATIONS

AND

IN THE MATTER OF

DESJARDINS GLOBAL ASSET MANAGEMENT INC.

(the Filer)

MRRS DECISION DOCUMENT

Background

The local securities regulatory authority or regulator (the Decision Maker) in each of the Jurisdictions has received an application from the Filers for a decision under the securities legislation of the Jurisdictions (the Legislation) for an exemption from:

(a) the prohibition contained in the Legislation of each of the Jurisdictions, except British Columbia, against an investment counsel or any partner, officer or associate of an investment counsel purchasing or selling any security in which they have a beneficial interest from or to any portfolio managed or supervised by the investment counsel (the Related Party Relief); and

(b) the obligation to file monthly reports in respect of such related party transactions (the Reporting Relief),

( (a) and (c) are collectively the Requested Relief).

Definitions

Defined terms contained in National Instrument 14-101 Definitions (NI 14-101) have the same meaning in this Decision unless they are otherwise defined in this Decision. The following additional terms shall have the following meanings:

"Manager" means Fédération des caisses Desjardins du Québec;

"NI 81-106" means National Instrument 81-106 Investment Fund Continuous Disclosure;

"NI 81-107" means National Instrument 81-107 Independent Review Committee for Investment Funds; and

"Related Party" means Desjardins Trust Inc.

Representations

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

1. The Filer is the portfolio manager of Desjardins Short-Term Income Fund (the Fund). Fédération des caisses Desjardins du Québec is the manager of the Fund and Desjardins Trust Inc. is the trustee of the Fund.

2. The Fund has an investment objective that permits the Fund to invest in mortgages.

3. The Fund is an open-end mutual fund, organized as a trust, and is a reporting issuer under the Legislation of each of the Jurisdictions.

4. The Filer is a "management company" or equivalent under the Legislation, and is registered under the Legislation as needed in connection with the services or advice provided to the Fund.

5. The Manager has appointed an independent review committee (IRC) under NI 81-107 for the Fund.

6. The Manager has appointed the Filer to provide portfolio management and investment advisory services to the Fund. As portfolio manager of the Fund, the Filer is a "responsible person" as defined in the Legislation.

7. The Related Party is an associate or affiliate of the Fund's manager and portfolio manager. The Fund may purchase mortgages for its portfolio from the Related Party.

8. The Related Party and the Manager have agreed to repurchase, or cause to be repurchased, from the Fund any mortgage the Fund has purchased from them that is in default or is not a valid first mortgage.

9. Neither the Related Party, nor any of its directors, officers or employees participates in the formulation of investment decisions made on behalf of, or advice given to, the Fund by the Filer. In all circumstances, the decisions to purchase mortgages for the Fund's portfolio from the Related Party are made based on the judgement of responsible persons uninfluenced by considerations other than the best interests of the Fund.

10. The Filer and the Related Party are "affiliates" within the meaning of the Legislation and accordingly, the Filer is deemed to own securities beneficially owned by the Related Party.

11. The Filer is prohibited under the Legislation from purchasing or selling on behalf of the Fund, the securities of any issuer from or to its own account. Accordingly, the Fund is prohibited from purchasing mortgages from, or selling mortgages to, the Related Party, as such mortgages are deemed to be beneficially owned by the Filer.

12. NI 81-107 provides an exemption from the inter-fund self-dealing investment prohibitions, as defined under NI 81-107, to permit trades in securities between funds. NI 81-107 does not, however, provide an exemption for principal trading of the type contemplated by the Requested Relief.

13. The provisions of National Policy Statement No. 29 -- Mutual Funds Investing in Mortgages (NP 29) set out guidelines relating to the acquisition of mortgages by a mutual fund from lending institutions with whom such fund does not deal at arm's length and provide certain protections to the investing public. The Filer acquired mortgages from the Related Party on behalf of the Fund in accordance with NP 29. The Filer will only acquire mortgages from the Related Party in accordance with NP 29 under the Requested Relief.

14. The IRC of the Fund will consider the policies and procedures of the Filer and will provide its approval on whether the proposed transactions in mortgages achieve a fair and reasonable result for the Fund in accordance with section 5.2(2) of NI-81-107.

15. To the extent that a Fund is purchasing mortgages from, or selling mortgages to, the Related Party, this fact is set out, and will continue to be set out, in the annual information form of the Fund.

16. The Legislation requires the filing of a report by the Filer with respect to each transaction in mortgages between the Fund and the Related Party and with respect to each transaction in mortgages effected by the Filer in respect of which the Related Party receives a fee either from the Filer or from the other party to the transaction or from both.

17. Such report is to be filed within 30 days after the end of the month in which the transaction occurs, disclosing the issuer of the securities purchased or sold, the class or designation of the securities, the amount and number of securities and the consideration paid, together with the name of any related person receiving a fee on the transaction, the name of the person or company that paid the fee and the amount of the fee paid.

18. NI 81-106 requires the Fund to prepare and file annual and interim management reports of fund performance that include a discussion of transactions involving related parties to the Fund. When discussing portfolio transactions with related parties, NI 81-106 requires the Fund to include the dollar amount of commission, spread, or any other fee paid to a related party in connection with a portfolio transaction.

Decision

Each of the Decision Makers is satisfied that the test contained in the Legislation that provides the Decision Makers with the jurisdiction to make the decision has been met.

The decision of the Decision Makers under the Legislation is that the Requested Relief is granted, provided that

(1) With respect to the Related Party Relief:

(a) the purchase or sale is consistent with, or is necessary to meet, the investment objective of the Fund;

(b) the IRC of the Fund has approved the transaction in accordance with section 5.2(2) of NI 81-107;

(c) the Manager of the Fund complies with section 5.1 of NI 81-107;

(d) the Manager of the Fund and the IRC of the Fund comply with section 5.4 of NI 81-107 for any standing instructions the IRC provides in connection with the transactions;

(e) the Fund keeps the written records required by section 6.1(2)(g) of NI 81-107; and

(f) the mortgages are acquired from the Related Party or sold to the Related Party in accordance with NP 29 (or any successor policy or instrument) and disclosed in accordance with NP 29 (or any successor policy or instrument).

(2) With respect to the Reporting Relief:

(a) the annual and interim management reports of fund performance for the Fund disclose

(i) the name of the Related Party,

(ii) the amount of fees paid to each Related Party, and

(iii) the person or company who paid the fees if they were not paid by the Fund; and

(b) the records of portfolio transactions maintained by the Fund include, separately for every portfolio transaction effected by the Fund through a Related Party,

(i) the name of the Related Party,

(ii) the amount of fees paid to the Related Party, and

(iii) the person or company who paid the fees.

"Lawrence E. Ritchie"

"David L. Knight"

Jones Heward Investment Counsel Inc. et al. - MRRS Decision

Headnote

Mutual Reliance Review System for Exemptive Relief Applications -- Relief granted to permit portfolio managers, on behalf of certain funds, to purchase and sell mortgages from and to affiliates of the portfolio manager -- Section 7.2 of National Instrument 81-107 Independent Review Committee for Investment funds causes prior relief to expire on November 1, 2007 -- New relief now issued on revised conditions which contemplate IRC approval. Relief also granted to permit alternative reporting of related party transactions.

Applicable Legislative Provisions

Securities Act (Ontario), ss. 117(1)(a), 117(1)(c), 121(2)(a)(ii).

Ontario Regulation 1015 General Regulation, s. 115(6).

May 14, 2008

IN THE MATTER OF

THE SECURITIES LEGISLATION OF

BRITISH COLUMBIA, ALBERTA, SASKATCHEWAN,

ONTARIO, QUEBEC, NEW BRUNSWICK,

NOVA SCOTIA AND NEWFOUNDLAND

AND LABRADOR

(the Jurisdictions)

AND

IN THE MATTER OF

THE MUTUAL RELIANCE REVIEW SYSTEM

FOR EXEMPTIVE RELIEF APPLICATIONS

AND

IN THE MATTER OF

JONES HEWARD INVESTMENT COUNSEL INC.,

I.G. INVESTMENT MANAGEMENT, LTD. AND

MACKENZIE FINANCIAL CORPORATION

(the Filers)

MRRS DECISION DOCUMENT

Background

The local securities regulatory authority or regulator (the Decision Maker) in each of the Jurisdictions has received an application from the Filers for a decision under the securities legislation of the Jurisdictions (the Legislation) for an exemption from:

(a) the prohibition contained in the Legislation against a portfolio manager knowingly causing an investment portfolio managed by it to buy or sell securities of any issuer from or to the account of a responsible person, any associate of the responsible person or the portfolio manager in connection with the purchase and sale of mortgages between a Related Party (as defined below) and the Funds (as defined below);

(b) the prohibition contained in the Legislation of each of the Jurisdictions, except British Columbia and Quebec, against an investment counsel or any partner, officer or associate of an investment counsel purchasing or selling any security in which they have a beneficial interest from or to any portfolio managed or supervised by the investment counsel; ((a) and (b) are collectively the Related Party Relief) and

(c) the obligation contained in the Legislation of each of the Jurisdictions, except Quebec, to file monthly reports in respect of such related party transactions (the Reporting Relief),

((a) ,(b), and (c) are collectively the Requested Relief).

Definitions

Defined terms contained in National Instrument 14-101 Definitions (NI 14-101) have the same meaning in this Decision unless they are otherwise defined in this Decision. The following additional terms shall have the following meanings:

"Manager" means each of BMO Investments Inc., BMO Nesbitt Burns Inc., BMO Harris Investment Management Inc., I.G. Investment Management, Ltd. and Mackenzie Financial Corporation;

"NI 81-106" means National Instrument 81-106 Investment Fund Continuous Disclosure;

"NI 81-107" means National Instrument 81-107 Independent Review Committee for Investment Funds; and

"Related Party" means each of Bank of Montreal and/or MCAP Financial Corporation, Investors Group Trust Co. Ltd. and its affiliates and M.R.S. Trust Company.

Representations

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

1. The Filers are the portfolio managers of the funds listed on Schedule A (the Funds). The manager and trustee (if applicable) of each Fund is also listed on Schedule A.

2. Each Manager is the manager of a Fund that has an investment objective that permits the Fund to invest in mortgages. The Funds, other than BMO Short-Term Income Class and Investors Mortgage and Short Term Income Fund, were established under the laws of Ontario. BMO Short-Term Income Class is a class of a corporation established under the laws of Canada and Investors Mortgage and Short Term Income Fund is a trust established under the laws of Manitoba.

3. Each Fund is an open-end mutual fund, organized as either a trust or a class of a corporation, and is a reporting issuer in each province and territory of Canada, other than BMO Harris Canadian Bond Income Portfolio, BMO Harris Canadian Total Return Bond Portfolio and BMO Harris Canadian Corporate Bond Portfolio, which are not reporting issuers in any of the territories.

4. Each of the Filers and/or the Managers of the Funds is a "management company" or equivalent under the Legislation, and is registered under the Legislation as needed in connection with the services or advice provided to a Fund.

5. Each Manager has appointed an independent review committee (IRC) under NI 81-107 for each of its Funds.

6. Each Manager has appointed the Filer referenced in Schedule A to provide portfolio management and investment advisory services to the applicable Fund. As portfolio manager of such Fund, each Filer is a "responsible person" as defined in the Legislation.

7. Each Related Party is an associate or affiliate of a Fund's manager, portfolio manager or trustee. Each of the Funds may purchase the mortgages for their portfolios from such Related Party, as set forth on Schedule A.

8. Bank of Montreal and/or MCAP Financial Corporation have agreed to repurchase from their applicable Funds any mortgage that is in default or is not a valid first mortgage. I.G. Investment Management Ltd. (or its affiliates) and M.R.S. Trust Company have agreed to repurchase from their applicable Funds any mortgage that is not a valid first mortgage.

9. Neither the Related Party, nor any of its directors, officers or employees participates in the formulation of investment decisions made on behalf of, or advice given to, the applicable Fund by the Filer, and in circumstances where the Related Party holds mortgages beneficially on behalf of the Filer, no director, officer or employee actively involved in the formulation of investment decisions for the Fund by the Filer is involved in the mortgage business of the Related Party. In all circumstances, the decisions to purchase mortgages for a Fund's portfolio from a Related Party are made based on the judgement of responsible persons uninfluenced by considerations other than the best interests of the Fund.

10. Each Filer and its Related Party are "affiliates" within the meaning of the Legislation and accordingly, the Filer is deemed to own securities beneficially owned by the Related Party.

11. Each Filer is prohibited under the Legislation from purchasing or selling on behalf of the Fund, the securities of any issuer from or to its own account. Accordingly, each Fund is prohibited from purchasing mortgages from, or selling mortgages to, its Related Party, as such mortgages are deemed to be beneficially owned by the Filer.

12. Jones Heward Investment Counsel Inc. and Mackenzie Financial Corporation each believe it received the Requested Relief previously for certain Funds (the Prior Relief). Section 7.2 of NI 81-107 terminated the Prior Relief.

13. NI 81-107 provides an exemption from the inter-fund self-dealing investment prohibitions, as defined under NI 81-107, to permit trades in securities between funds. NI 81-107 does not, however, provide an exemption for principal trading of the type contemplated by the Requested Relief.

14. The provisions of National Policy Statement No. 29 -- Mutual Funds Investing in Mortgages (NP 29) set out guidelines relating to the acquisition of mortgages by a mutual fund from lending institutions with whom such fund does not deal at arm's length and provide certain protections to the investing public. The Filers acquired mortgages from the Related Parties on behalf of the Funds in accordance with NP 29. The Filers will only acquire mortgages from the Related Parties in accordance with NP 29 under the Requested Relief.

15. The IRC of each Fund will consider the policies and procedures of the applicable Filer and will provide its approval on whether the proposed transactions in mortgages achieve a fair and reasonable result for the Fund in accordance with section 5.2(2) of NI-81-107.

16. To the extent that a Fund is purchasing mortgages from, or selling mortgages to, a Related Party, this fact is set out, and will continue to be set out, in the annual information form of the applicable Fund.

17. The Legislation requires the filing of a report by each Filer with respect to each transaction in mortgages between the applicable Fund and its Related Party and with respect to each transaction in mortgages effected by each Filer in respect of which the Related Party receives a fee either from the Filer or from the other party to the transaction or from both.

18. Such report is to be filed within 30 days after the end of the month in which the transaction occurs, disclosing the issuer of the securities purchased or sold, the class or designation of the securities, the amount and number of securities and the consideration paid, together with the name of any related person receiving a fee on the transaction, the name of the person or company that paid the fee and the amount of the fee paid.

19. NI 81-106 requires the Funds to prepare and file annual and interim management reports of fund performance that include a discussion of transactions involving related parties to the Funds. When discussing portfolio transactions with related parties, NI 81-106 requires the Funds to include the dollar amount of commission, spread, or any other fee paid to a related party in connection with a portfolio transaction.

Decision

Each of the Decision Makers is satisfied that the test contained in the Legislation that provides the Decision Makers with the jurisdiction to make the decision has been met.

The decision of the Decision Makers under the Legislation is that the Requested Relief is granted, provided that

(1) With respect to the Related Party Relief for each Filer:

(a) the purchase or sale is consistent with, or is necessary to meet, the investment objective of the Fund;

(b) the IRC of the Fund has approved the transaction in accordance with section 5.2(2) of NI 81-107;

(c) the Manager of the Fund, complies with section 5.1 of NI 81-107;

(d) the Manager of the Fund and the IRC of the Fund comply with section 5.4 of NI 81-107 for any standing instructions the IRC provides in connection with the transactions;

(e) the Fund keeps the written records required by section 6.1(2)(g) of NI 81-107; and

(f) the mortgages are acquired from a Related Party or sold to a Related Party in accordance with NP 29 (or any successor policy or instrument) and disclosed in accordance with NP 29 (or any successor policy or instrument).

(2) With respect to the Reporting Relief for each Filer:

(a) the annual and interim management reports of fund performance for the Fund disclose

(i) the name of the Related Party,

(ii) the amount of fees paid to each Related Party, and

(iii) the person or company who paid the fees if they were not paid by the Fund; and

(b) the records of portfolio transactions maintained by the Fund include, separately for every portfolio transaction effected by the Fund through a Related Party,

(i) the name of the Related Party,

(ii) the amount of fees paid to the Related Party, and

(iii) the person or company who paid the fees.

"Lawrence E. Ritchie"

"David L. Knight"

SCHEDULE "A"

List of Managers, Funds, Portfolio Managers, Trustees and Related Parties

Banc of America Securities LLC et al. - s. 147 of the Act and s. 6.1 of Rule 13-502 Fees

Headnote

Relief from section 6.5 of OSC Rule 45-501 Ontario Prospectus Exemptions - Relief granted from s. 6.5 for forward-looking information in offering memoranda provided to accredited investors in connection with private placements by foreign issuer - such private placements are generally small part of larger distributions of securities by foreign issuers outside Canada pursuant to foreign offering documents - relief subject to conditions - Relief also granted from section 4.1 of OSC Rule 13-502 Fees.

Applicable Legislative Provisions

Securities Act (Ontario), s. 147.

OSC Rule 13-502 Fees, s. 4.1.

OSC Rule 45-501 Ontario Prospectus Exemptions, s. 6.5.

IN THE MATTER OF

THE SECURITIES ACT,

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

AND

IN THE MATTER OF

BANC OF AMERICA SECURITIES LLC

BARCLAYS CAPITAL INC.

CITIGROUP GLOBAL MARKETS INC.

COWEN AND COMPANY, LLC

DEUTSCHE BANK SECURITIES INC.

GOLDMAN, SACHS & CO.

J.P. MORGAN SECURITIES INC.

LEHMAN BROTHERS CANADA INC.

MACQUARIE CAPITAL MARKETS CANADA LTD.

MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED

MORGAN STANLEY & CO. INCORPORATED

AND

UBS SECURITIES LLC

ORDER

(Section 147 of the Act

and

Section 6.1 of Rule 13-502 Fees)

WHEREAS effective December 31, 2007 Ontario Securities Commission Rule 45-501 -- Ontario Prospectus Exemptions ("Rule 45-501") was amended to, among other things, require that an offering memorandum used in Ontario which contains forward-looking information comply with certain new provisions of National Instrument 51-102 -- Continuous Disclosure Obligations ("NI 51-102");

AND UPON the application (the "Application") of the dealers listed on Schedule "A" hereto (collectively, the "Applicants") each applying for itself and its affiliated dealers shown beside its name in Schedule "B" hereto (the Applicants and their affiliated dealers collectively referred to herein as the "Dealers") to the Ontario Securities Commission (the "Commission") for an order pursuant to Section 147 of the Securities Act, R.S.O. 1990, c. S.5, as amended (the "Act") to provide that Section 6.5 of Rule 45-501 shall not be applicable to an offering memorandum of a non-Canadian issuer that is not a reporting issuer in Ontario (each, a "Foreign Issuer") provided to a prospective purchaser in Ontario by the Applicants

AND UPON the Application of the Applicants to the Director for an exemption pursuant to Section 6.1 of OSC Rule 13-502 -- Fees ("Rule 13-502") to provide that Section 4.1 of Rule 13-502 shall not be applicable to the Applicants;

AND UPON the Applicants having represented to the Commission that:

1. Each of the Dealers is incorporated or otherwise organized by under the laws of the jurisdiction shown opposite its name in Schedule "B" hereto.

2. Each of the Dealers is registered with the OSC as a dealer in the category shown opposite its name in Schedule "B" hereto.

3. The Dealers offer and sell securities of Foreign Issuers on a private placement basis to purchasers in Ontario relying on the "accredited investor" prospectus exemption under Section 2.3 of National Instrument 45-106 -- Prospectus and Registration Exemptions.

4. The offerings by private placement of securities of a Foreign Issuer (each, a "Foreign Issuer Private Placement") in Ontario are part of a distribution of securities of a Foreign Issuer offered primarily outside of Canada pursuant to a prospectus, offering memorandum or other offering document (each, a "Foreign Offering Document") prepared in accordance with the requirements of the United States or other non-Canadian jurisdictions.

5. In a Foreign Issuer Private Placement, a Foreign Offering Document is generally accompanied by a "wrapper" or is otherwise supplemented with disclosure prescribed by Ontario securities law and with disclosure of certain additional information for the benefit of Ontario investors and provided by the Dealers to Ontario prospective purchasers as a Foreign Issuer's offering memorandum within the meaning of Section 1(1) of the Act.

6. In a Foreign Issuer Private Placement, a Foreign Issuer that intends to rely on the civil liability safe harbour with respect to forward-looking statements provided by Section 21E of the U.S. Securities Exchange Act of 1934, as amended (the "Exchange Act") or Section 27A of the U.S. Securities Act of 1933, as amended (the "U.S. Securities Act"), will generally include in its Foreign Offering Document disclosure with respect to "forward-looking statements" within the meaning of Section 21E of the Exchange Act and Section 27A of the U.S. Securities Act to enable the Foreign Issuer to rely on the civil liability safe harbour provided with respect to forward-looking statements.

7. Other Foreign Issuers conducting a Foreign Issuer Private Placement that include forward looking information in their Foreign Offering Document will generally include disclosure of related material risk factors potentially affecting the forward looking information.

8. The disclosure with respect to forward looking information contained in a Foreign Offering Document used in a Foreign Issuer Private Placement in Ontario will not necessarily include all of the disclosure prescribed for offering memoranda by section 6.5 of Rule 45-501.

AND UPON considering the Application and the recommendation of the staff of the Commission;

AND UPON the Commission being satisfied that it would not be prejudicial to the public interest to make this Order;

IT IS ORDERED, pursuant to section 147 of the Act, that offering memoranda delivered by or on behalf of the Dealers to prospective purchasers that are accredited investors in connection with Foreign Issuer Private Placements shall not be subject to Section 6.5 of Rule 45-501, provided that a Foreign Offering Document contains or is accompanied by either:

(a) the disclosure required in order for an issuer to rely on the safe harbour provided by Section 21E of the Exchange Act or by Section 27A of the U.S. Securities Act with respect to forward looking information, whether or not such safe harbour is applicable; or

(b) a statement that "This offering is being made by a non-Canadian issuer using disclosure documents prepared in accordance with non-Canadian securities laws. Prospective purchasers should be aware that these requirements may differ significantly from those of Ontario. The forward looking information included or incorporated by reference herein may not be accompanied by the disclosure and explanations that would be required of a Canadian issuer under Ontario securities law."

DATED at Toronto, this 16th day of May, 2008.

AND UPON the Director being satisfied that it would not be prejudicial to the public interest to make this Order;

IT IS ORDERED, pursuant to Section 6.1 of Rule 13-502, that the Application shall not be subject to Section 4.1 of Rule 13-502.

DATED at Toronto, this 16th day of May, 2008.

Schedule "A"

List of Applicants

Banc of America Securities LLC

Barclays Capital Inc.

Citigroup Global Markets Inc.

Cowen and Company, LLC

Deutsche Bank Securities Inc.

Goldman, Sachs & Co.

J.P. Morgan Securities Inc.

Lehman Brothers Canada Inc.

Macquarie Capital Markets Canada Ltd.

Merrill Lynch, Pierce, Fenner & Smith Incorporated

Morgan Stanley & Co. Incorporated

UBS Securities LLC

Schedule "B"

List of Dealers Affiliated with Applicants

Sulja Bros. Building Supplies, Ltd. (Nevada) et al.

IN THE MATTER OF

THE SECURITIES ACT,

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

AND

IN THE MATTER OF

SULJA BROS. BUILDING SUPPLIES, LTD. (NEVADA),

SULJA BROS. BUILDING SUPPLIES LTD.,

KORE INTERNATIONAL MANAGEMENT INC.,

PETAR VUCICEVICH AND ANDREW DeVRIES

ORDER

WHEREAS on December 22, 2006, the Ontario Securities Commission (the "Commission") ordered pursuant to subsections 127(1) and 127(5) of the Securities Act, R.S.O. 1990, c. S.5, as amended (the "Act") that immediately for a period of 15 days from the date thereof: (a) all trading in securities of Sulja Bros. Building Supplies, Ltd. (Nevada) ("Sulja Nevada") cease; and (b) any exemptions in Ontario securities law do not apply to the Respondents (the "Temporary Order");

AND WHEREAS on December 27, 2006, the Commission issued a Notice of Hearing and Statement of Allegations in this matter;

AND WHEREAS on January 8, 2007, the Temporary Order was extended to March 23, 2007;

AND WHEREAS on March 23, 2007, the Temporary Order was extended to July 5, 2007;

AND WHEREAS on July 5, 2007, the Temporary Order was extended to September 7, 2007;

AND WHEREAS on September 7, 2007, the Temporary Order was extended to October 31, 2007;

AND WHEREAS on October 31, 2007, the Temporary Order was extended to January 22, 2008;

AND WHEREAS on January 22, 2008, the Temporary Order was extended to March 28, 2008;

AND WHEREAS on March 28, 2008, the Temporary Order was extended to May 23, 2008;

AND WHEREAS on May 23, 2008, the Respondents, Sulja Nevada, Sulja Bros. Building Supplies Ltd. ("Sulja Ontario"), Kore International and Petar Vucicevich, consent to the continuation of the Temporary Order;

AND WHEREAS the Respondent, Andrew DeVries, did not appear, though served with notice of this Hearing;

AND WHEREAS the Commission is of the opinion that it is in the public interest to make this order in order to permit Staff to determine how to proceed in this matter within the period of this extension;

IT IS ORDERED THAT the Temporary Order is extended to June 23, 2008, and the hearing is adjourned to June 23, 2008 at 10:00 a.m.

DATED at Toronto this 23rd day of May, 2008.

"James E. A. Turner"

"Margot C. Howard"

AldeaVision Solutions Inc. - s. 144

Headnote

Application by an issuer for a full revocation of a cease trade order - issuer cease traded due to failure to file certain continuous disclosure documents required by Ontario securities law - issuer completed a court-approved plan of arrangement and reorganization pursuant to the CCAA and the CBCA - issuer has three shareholders - cease trade order revoked.

Statutes Cited

Securities Act, R.S.O. 1990, c. S.5, as am., ss. 127, 144.

Companies' Creditors Arrangement Act, R.S.C 1985, c. C-36.

Canada Business Corporations Act, R.S.C. 1985, c. C-44.

May 23, 2008

IN THE MATTER OF

THE SECURITIES ACT,

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

(the "Act")

AND

IN THE MATTER OF

ALDEAVISION SOLUTIONS INC.

ORDER

(Section 144)

WHEREAS the securities of AldeaVision Solutions Inc. ("AVS") are subject to a temporary cease trade order of the Ontario Securities Commission (the "Commission") pursuant to paragraphs 2 and 2.1 of subsection 127(1) and subsection 127(5) of the Act, dated December 19, 2007, as extended by a further order dated December 31, 2007 pursuant to subsection 127(8) of the Act (collectively, the "Cease Trade Order") directing that all trading in the securities of AVS cease until the Cease Trade Order is revoked;

AND WHEREAS AVS has applied to the Commission pursuant to section 144 of the Act (the "Application") for an order revoking the Cease Trade Order;

AND UPON AVS having represented that:

1. AVS is a corporation incorporated under the Canada Business Corporations Act (the "CBCA") and has been a reporting issuer in all Canadian provinces (the "Reporting Jurisdictions") for over ten years. AVS' head office is located at 8550 Côte-de-Liesse, Saint-Laurent, Québec H4T 1H2.

2. AVS is a provider of international video transmission services.

3. AVS has an authorized share capital consisting of an unlimited number of common shares, of class A preferred shares and of class B preferred shares, of which currently there are 3,570,000 common shares issued and outstanding (the "Common Shares") and no class A preferred shares or class B preferred shares issued and outstanding.

4. The Common Shares were listed on the TSX Venture Exchange ("TSXV"). The TSXV de-listed the Common Shares on January 25, 2008 as a result of AVS' failure to meet its listing requirements.

5. Consequently, currently no securities of AVS are traded on a marketplace as defined in National Instrument 21-101 Marketplace Operation.

6. The Cease Trade Order was issued due to the failure of AVS to file: (i) audited annual financial statements for its financial year ended December 31, 2006; (ii) management's discussion and analysis relating to the audited annual financial statements for the year ended December 31, 2006; (iii) interim financial statements for the three-month period ended March 31, 2007; (iv) management's discussion and analysis relating to the interim financial statements for the three-month period ended March 31, 2007; (v) interim financial statements for the six-month period ended June 30, 2007; (vi) management's discussion and analysis relating to the interim financial statements for the six-month period ended June 30, 2007; (vii) interim financial statements for the nine-month period ended September 30, 2007; and (viii) management's discussion and analysis relating to the nine-month period ended September 30, 2007 (collectively, the "Continuous Disclosure Documents").

7. In addition to AVS' failure to file the Continuous Disclosure Documents that resulted in the imposition of the Cease Trade Order, AVS remains in default of subsequent continuous disclosure filing requirements under Ontario securities law.

8. On December 20, 2007, AVS obtained an order (the "Order") from the Québec Superior Court sanctioning a plan of arrangement and reorganization (the "Plan") pursuant to the Companies' Creditors Arrangement Act (Canada) and the CBCA.

9. The ultimate result of the Order and the Plan, which was completed on January 11, 2008, was to reduce the number of shareholders of AVS to three, namely: (i) Capital Régional et Coopératif Desjardins (155,915 Common Shares); (ii) Desjardins Capital de Développement Montréal Métropolitain, Ouest et Nord du Québec Inc. (14,085 Common Shares); and (iii) Almiria Capital Corp. (3,400,000 Common Shares).

10. AVS has no securities, including debt securities, outstanding other than an aggregate of 3,570,000 Common Shares.

11. AVS applied to voluntarily surrender its status as a reporting issuer in British Columbia under BC Instrument 11-502 Voluntary Surrender of Reporting Issuer Status. AVS ceased to be a reporting issuer in British Columbia on April 9, 2008 and a cease trade order issued in British Columbia on the securities of the Filer was revoked on April 11, 2008.

12. AVS concurrently applied to all of the Reporting Jurisdictions (other than British Columbia) for a decision that AVS is no longer a reporting issuer or the equivalent in each of the Reporting Jurisdictions. The relief sought was granted by the Reporting Jurisdictions on the date hereof.

13. Securities of AVS are currently also subject to cease trade orders issued by the securities regulatory authorities in each of the provinces of Manitoba and Québec. AVS has concurrently applied for orders revoking those cease trade orders as well.

AND UPON considering the Application and the recommendation of the staff of the Commission;

AND UPON the Commission being satisfied that to do so would not be prejudicial to the public interest;

IT IS ORDERED pursuant to section 144 of the Act that the Cease Trade Order is revoked.

XI Biofuels Inc. 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

XI BIOFUELS INC., BIOMAXX SYSTEMS INC.,

RONALD DAVID CROWE AND VERNON P. SMITH

AND

IN THE MATTER OF

XIIVA HOLDINGS INC. CARRYING ON BUSINESS

AS XIIVA HOLDINGS INC., XI ENERGY COMPANY,

XI ENERGY AND XI BIOFUELS

ORDER

(Section 127 of the Securities Act)

WHEREAS on November 22, 2007, the Ontario Securities Commission (the "Commission") issued a Temporary Order pursuant to subsections 127(1) and (5) of the Securities Act, R.S.O. 1990, c.S.5, as amended (the "Act") that all trading by XI Biofuels Inc. ("XI") and Biomaxx Systems Inc. ("Biomaxx") shall cease, that XI, Biomaxx, Ronald David Crowe ("Crowe") and Vernon P. Smith ("Smith") (the "XI Respondents") cease trading in all securities and that the exemptions contained in Ontario securities law do not apply to the XI Respondents (the "XI Temporary Order");

AND WHEREAS the Commission further ordered that pursuant to subsection 127(6) of the Act, the XI Temporary 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 November 22, 2007, the Commission issued a Notice of Hearing to be held on December 7, 2007 at 10:00 a.m., to consider, among other things, the extension of the XI Temporary Order (the "XI Hearing");

AND WHEREAS on December 7, 2007, upon being advised that the XI Respondents agreed to extend the XI Temporary Order without prejudice to their ability to argue the merits of the grounds for granting the XI Temporary Order, the Commission ordered that the XI Temporary Order be extended and that the XI Hearing be adjourned to March 25, 2008;

AND WHEREAS on December 14, 2007, the Commission issued a Temporary Order (the "Xiiva Temporary Order") pursuant to subsections 127(1) and (5) of the Act that all trading in securities of Xiiva Holdings Inc. ("Xiiva"), incorrectly described at paragraph 1 of the Xiiva Temporary Order as XI Holdings Inc., shall cease and that the exemptions contained in Ontario securities law do not apply to it;

AND WHEREAS the Commission further ordered that pursuant to subsection 127(6) of the Act, the Xiiva Temporary 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 December 14, 2007, the Commission issued a Notice of Hearing to be held on December 19, 2007 at 2:00 p.m., to consider, among other things, the extension of the Xiiva Temporary Order (the "Xiiva Hearing");

AND WHEREAS on December 19, 2007, upon being advised that Xiiva agreed to extend the Xiiva Temporary Order without prejudice to its ability to argue the merits of the grounds for granting the Xiiva Temporary Order, the Commission ordered that the Xiiva Temporary Order be extended and that the Xiiva Hearing be adjourned to March 25, 2008 and that paragraph 1 of the Xiiva Temporary Order be amended to replace the reference to "XI Holdings Inc." with "Xiiva Holdings Inc.";

AND WHEREAS the XI Respondents and the Xiiva Respondents (collectively, the "Respondents") served a notice of motion returnable on March 25, 2008 in respect of the XI Temporary Order and the Xiiva Temporary Order (collectively, the "Temporary Orders") and other matters including a constitutional question (the "Respondents' Motion");

AND WHEREAS on March 20, 2008, the Respondents served a Notice of Constitutional Question and an Amended Notice of Constitutional Question;

AND WHEREAS the 15-day notice period for the Notice of Constitutional Question under section 109 of the Courts of Justice Act, R.S.O. 1990, c. C.43, as amended, had not been satisfied;

AND WHEREAS on March 25, 2008, Staff of the Commission ("Staff") and the Respondents agreed to adjourn the XI Hearing and the Xiiva Hearing for the extension of the Temporary Orders to May 5, 2008, at 10:00 a.m., or such earlier date as fixed by the Office of the Secretary, and agreed to the extension of the Temporary Orders to May 6, 2008;

AND WHEREAS on March 25, 2008, the Commission ordered that the XI Hearing and the Xiiva Hearing for the extension of the Temporary Orders and the hearing of the Respondents' Motion be adjourned to May 5, 2005;

AND WHEREAS on March 25, 2008, the Commission ordered that the Temporary Orders be extended to May 6, 2008;

AND WHEREAS on May 5, 2008, the Commission adjourned the XI Hearing and the Xiiva Hearing to extend the Temporary Orders and the hearing of the Respondents' Motion to May 22, 2008, at 2:00 p.m., on the basis that certain of the Respondents were the subject of an application for a bankruptcy order which was scheduled to be heard on May 22, 2008;

AND WHEREAS on May 5, 2008, the Commission ordered that the Temporary Orders be extended to May 23, 2008;

AND WHEREAS on May 22, 2008, counsel for Staff and counsel for the Respondents appeared before the Commission;

AND WHEREAS on May 22, 2008, counsel for the Respondents advised that a trustee in bankruptcy has been appointed with respect to some of the Respondents;

AND WHEREAS on May 22, 2008, counsel for the trustee in bankruptcy did not appear, and counsel for the other respondents requested an adjournment of the XI Hearing and the Xiiva Hearing to extend the Temporary Orders and the hearing of the Respondents' Motion to allow counsel for the trustee in bankruptcy to appear before the Commission;

AND WHEREAS the Commission requests that the trustee in bankruptcy or counsel for the trustee in bankruptcy appear before the Commission to make submissions with respect to this matter;

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

IT IS ORDERED that the Temporary Orders are extended to June 13, 2008;

AND IT IS FURTHER ORDERED that the XI Hearing and the Xiiva Hearing for the extension of the Temporary Orders and the hearing of the Respondents' Motion are adjourned to June 12, 2008 at 10:30 a.m.

Dated at Toronto this 22nd day of May, 2008.

"Patrick J. LeSage"

"Wendell S. Wigle"

"David L. Knight"

Adrian Samuel Leemhuis et al.

IN THE MATTER OF

THE SECURITIES ACT,

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

AND

IN THE MATTER OF

ADRIAN SAMUEL LEEMHUIS,

FUTURE GROWTH GROUP INC.,

FUTURE GROWTH FUND LIMITED,

FUTURE GROWTH GLOBAL FUND LIMITED,

FUTURE GROWTH MARKET NEUTRAL FUND LIMITED,

FUTURE GROWTH WORLD FUND, AND

ASL DIRECT INC.

ORDER

WHEREAS on April 22, 2008, the Ontario Securities Commission (the "Commission") issued a Temporary Order pursuant to section 127(5) of the Securities Act, R.S.O. 1990, c. S.5, as amended (the "Act") that all trading in securities of and all trading of securities by Future Growth Group Inc., Future Growth Fund Limited, Future Growth Global Fund Limited, Future Growth Market Neutral Fund Limited, and Future Growth World Fund shall cease, that all trading of securities by Adrian Leemhuis shall cease and that any exemptions contained in Ontario securities law do not apply to the Respondents;

AND WHEREAS on April 22, 2008, the Commission ordered that the Temporary Order dated April 22, 2008 shall expire on the 15th day after its making unless extended by order of the Commission;

AND WHEREAS on May 1, 2008, the Commission issued a Temporary Order pursuant to section 127(5) of the Act that all trading in securities by ASL Direct Inc. shall cease and that any exemptions contained in Ontario securities law do not apply to ASL;

AND WHEREAS on May 1, 2008, the Commission ordered that the Temporary Order dated May 1, 2008 shall expire on the 15th day after its making unless extended by the Commission;

AND WHEREAS on May 2, 2008, the Commission issued an Amended Notice of Hearing to consider the extension of the Temporary Order dated April 22, 2008, and the Temporary Order dated May 1, 2008 to be held on May 6, 2008 at 2:30 p.m.;

AND WHEREAS on May 6, 2008 the Commission held a hearing and counsel for Staff and counsel for the Respondents attended before the Commission and confirmed there was no objection to adjourning until May 16, 2008, and the Commission ordered that pursuant to section 127(8) that the Temporary Order dated April 22, 2008 be extended to May 16, 2008, that the Temporary Order dated May 1, 2008 be extended to May 16, 2008 and that the hearing to consider the extension of these orders be adjourned to May 16, 2008;

AND WHEREAS Staff of the Commission confirm that they may submit requests for the Commission to make orders pursuant to s. 144 of the Act, on consent, to vary the Temporary Orders dated April 22, 2008 and May 1, 2008 to permit ASL Direct Inc. and Mr. Leemhuis to carry out unsolicited trades on behalf of clients of ASL Direct Inc.;

AND WHEREAS the Commission held a hearing on May 16, 2008 and counsel for Staff and counsel for the Respondents attended before the Commission and at that time the Commission made an order continuing the Temporary Orders dated April 22, 2008 and May 1, 2008, until May 26, 2008;

AND WHEREAS the Commission held a hearing on May 26, 2008 and counsel for Staff and counsel for the Respondents attended before 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 pursuant to section 127(8) that the Temporary Order dated April 22, 2008, extended on May 6, 2008, and on May 26, 2008 is further extended to June 17, 2008;

IT IS FURTHER ORDERED that the Temporary Order dated May 1, 2008, extended on May 6, 2008 and on May 26, 2008 is further extended to June 17, 2008; and

IT IS FURTHER ORDERED that the hearing to consider the extension of the Temporary Order dated April 22, 2008 and the Temporary Order dated May 1, 2008 is adjourned to June 16, 2008 at 10:00 a.m.

DATED at Toronto this 26th day of May, 2008.

"Wendell S. Wigle"

"Margot C. Howard"

Ampal-American Israel Corporation - s. 144

Headnote

Application by an issuer for a revocation of a cease trade order issued by the Commission - cease trade order issued because the issuer had failed to file certain interim financial statements and mangement's discussion and analysis as required by Ontario securities law - defaults subsequently remedied and the issuer is otherwise not in default of Ontario Securities law - cease trade order revoked.

Statutes Cited

Securities Act, R.S.O. 1990, c. S.5, as am., ss. 127, 144.

IN THE MATTER OF

THE SECURITIES ACT,

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

(the "Act")

AND

IN THE MATTER OF

AMPAL-AMERICAN ISRAEL CORPORATION

(the "Applicant")

ORDER

(Section 144)

WHEREAS the securities of the Applicant are subject to an order dated December 1, 2006 by the Director made pursuant to paragraph 2 and paragraph 2.1 of subsection 127(1) of the Act (the "Cease Trade Order") directing all trading in and acquisitions of the securities of the Applicant, whether direct or indirect, cease until the Cease Trade Order is revoked by the Director;

AND WHEREAS the Applicant has made an application to the Ontario Securities Commission (the "Commission) for an order pursuant to section 144 of the Act revoking the Cease Trade Order;

AND UPON the Applicant having represented to the Commission that:

1. The Applicant is a corporation formed under the laws of New York in 1942 with its principal place of business located in New York, New York. The Applicant is subject to the reporting requirements of the United States Securities Exchange Act of 1934, as amended (the "1934 Act").

2. The Applicant is a reporting issuer under the Act.

3. The authorized capital of the Applicant consists of 100,000,000 Class A Stock ("Common Stock") with a par value of $1, of which 57,702,532 shares of Common Stock were issued and outstanding as of April 29, 2008.

4. The Common Stock of the Applicant is listed on Nasdaq Global Market System under the symbol "AMPL".

5. The Applicant's Series A and Series B Debentures are listed on the Tel-Aviv Stock Exchange.

6. No other securities of any other class or series are outstanding.

7. The number of Common Stock registered in the names of persons with addresses in Ontario and reported by Broadridge Financial Solutions, Inc. to be owned beneficially (but not of record) by shareholders resident in Ontario and the aggregate number of registered shareholders and beneficial owners (but not of record) with addresses in Ontario as at April 15, 2008 is as follows:

Total number of	20,754
Common Stock in
Ontario
Number of	26
shareholders in
Ontario

8. The number of Common Stock registered in the names of persons with addresses in Canada (outside Ontario) and reported by Broadridge Financial Solutions, Inc. to be owned beneficially (but not of record) by shareholders resident in Canada (outside Ontario) and the aggregate number of registered shareholders and beneficial owners (but not of record) with addresses in Canada (outside Ontario) as at April 15, 2008 is as follows

Total number of	33,266
Common Stock in
Canada
Number of	28
shareholders in
Canada

9. The Applicant does not believe that any of its Series A or Series B Debentures are held of record or beneficially by residents of Canada.

10. The Cease Trade Order was issued because the Applicant failed to file with the Commission within the prescribed time its interim financial statements for the nine-month period ended September 30, 2006 and management's discussion and analysis relating to the interim financial statements for the nine-month period ended September 30, 2006 (the "Continuous Disclosure Documents").

11. The Applicant failed to file its Continuous Disclosure Documents as a result of an oversight in instructing those responsible for EDGAR filings to concurrently file the required documents with the Commission.

12. The Applicant subsequently filed with the Commission the Continuous Disclosure Documents.

13. The Applicant is not in default of any of its obligations under the Act as a reporting issuer.

14. The Applicant is a "foreign issuer (SEDAR)" as that term is defined in National Instrument 13-101 -- System for Electronic Document Analysis and Retrieval (SEDAR) ("NI 13-101"), and has not elected to become an electronic filer in accordance with subsection 2.1(2) of NI 13-101.

15. The Applicant's securities were previously the subject of a cease trade order which was revoked by an order dated June 6, 2006. The previous cease trade order was issued because the Applicant failed to file with the Commission within the prescribed time its annual financial statements for the years ended December 31, 2003 and December 31, 2004, as well as its interim statements for the periods ended March 31, 2004, June 30, 2004, September 30, 2004, March 31, 2005, June 30, 2005 and September 30, 2005. The Applicant failed to file such documents as a result of a compliance oversight after a corporate restructuring of the Applicant.

16. To avoid defaults in future periods, the Applicant has adopted a process whereby one officer of the Applicant has been formally designated as the officer responsible for making all required filings with the Commission. The Applicant has also instructed its U.S. counsel to file with the Commission all documents it is asked by the Applicant to file with the Securities and Exchange Commission on EDGAR, unless such documents are not required to be filed with the Commission.

17. Based on preliminary information provided by the Applicant's transfer agent, residents of Canada do not directly or indirectly beneficially own more than 2% of the number of shares of Common Stock outstanding.

18. Based on preliminary information provided by the Applicant's transfer agent, residents of Canada do not directly or indirectly comprise more than 2% of the total number of security holders of the Applicant.

19. The Applicant has not in the last 12 months filed a prospectus in Canada in respect of an offering of securities in Canada or made application to list any securities on a Canadian marketplace or exchange.

AND UPON considering the Application and the recommendation of the staff of the Commission;

AND UPON the Commission being satisfied that it would not be prejudicial to the public interest to revoke the Cease Trade Order;

IT IS ORDERED under section 144 of the Act that the Cease Trade Order is revoked.

DATED 27th day of May, 2008.

Borealis International Inc. et al. - ss. 127(1), 127(5) and 127(7)

IN THE MATTER OF

THE SECURITIES ACT,

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

AND

IN THE MATTER OF

BOREALIS INTERNATIONAL INC.,

SYNERGY GROUP (2000) INC.,

INTEGRATED BUSINESS CONCEPTS INC.,

CANAVISTA CORPORATE SERVICES INC.,

CANAVISTA FINANCIAL CENTER INC.,

SHANE SMITH, ANDREW LLOYD, PAUL LLOYD,

VINCE VILLANTI, LARRY HALIDAY, JEAN BREAU,

JOY STATHAM, DAVID PRENTICE, LEN ZIELKE,

JOHN STEPHAN, RAY MURPHY,

ALEXANDER POOLE, DEREK GRIGOR,

EARL SWITENKY,MICHELLE DICKERSON,

DEREK DUPONT, BARTOSZ EKIERT,

ROSS MACFARLANE, BRIAN NERDAHL,

HUGO PITTOORS AND LARRY TRAVIS

ORDER

(Sections 127(1), (5) and (7))

WHEREAS on November 15, 2007, the Ontario Securities Commission (the "Commission") made an order pursuant to sections 127(1) and (5) of the Securities Act, R.S.O. 1990, c. S.5., as amended, in respect of Borealis International Inc. ("Borealis"), Synergy Group (2000) Inc. ("Synergy"), Integrated Business Concepts Inc. ("IBC"), Canavista Corporate Services Inc. ("Canavista Corporate"), Canavista Financial Center Inc. ("Canavista Financial"), Shane Smith ("Smith"), Andrew Lloyd, Paul Lloyd, Vince Villanti ("Villanti"), Larry Haliday ("Haliday"), Jean Breau ("Breau"), Joy Statham ("Statham"), David Prentice ("Prentice"), Len Zielke ("Zielke"), John Stephan ("Stephan"), Ray Murphy ("Murphy"), Derek Grigor ("Grigor"), Earl Switenky ("Switenky") and Alexander Poole ("Poole") (the "Original Respondents") that all trading in securities by and of the Original Respondents, with the exception of Poole, cease, and that any exemptions contained in Ontario securities law do not apply to the Original Respondents, with the exception of Poole (the "Temporary Order");

AND WHEREAS the Temporary Order also provided that pursuant to clause 1 of section 127(1), the following terms and conditions were imposed on Poole's registration: Poole shall be subject to monthly supervision by his sponsoring firm which, commencing November 30, 2007, will submit monthly supervision reports to the Commission (attention: Manager, Registrant Regulation) in a form specified by the Manager, Registrant Regulation, reporting details of Poole's sales activities and dealings with clients;

AND WHEREAS on November 15, 2007, the Commission issued a Notice of Hearing and Statement of Allegations in this matter;

AND WHEREAS on November 28, 2007, the Commission ordered that the Temporary Order be continued in respect of the Original Respondents, except Borealis, Synergy, IBC, Canavista Financial, Smith, Villanti, Haliday, Breau, Paul Lloyd, Zielke, Grigor and Switenky, until May 27, 2008;

AND WHEREAS on November 28, 2007, the Commission ordered that in respect of Borealis, Synergy, IBC, Canavista Financial, Smith, Villanti, Haliday, Breau, Paul Lloyd, Zielke, Grigor and Switenky, the Temporary Order be continued until January 11, 2008;

AND WHEREAS on January 11, 2008, the Commission ordered that in respect of the Original Respondents, the Temporary Order be continued until May 27, 2008;

AND WHEREAS on May 22, 2008, the Commission issued an Amended Notice of Hearing and an Amended Statement of Allegations by which, inter alia, the following individuals were added as respondents: Michelle Dickerson ("Dickerson"), Derek Dupont ("Dupont"), Bartosz Ekiert ("Ekiert"), Ross Macfarlane ("Macfarlane"), Brian Nerdahl ("Nerdahl"), Hugo Pittoors ("Pitoors"), and Larry Travis ("Travis") (collectively the "New Respondents").

AND UPON HEARING submissions from Paul Lloyd, on his own behalf and on behalf of Canavista Financial, from counsel for Staff of the Commission and from counsel for Borealis, Synergy, IBC, Smith, Villanti, Haliday and Breau, and on behalf of Dickerson, no one appearing for Canavista Corporate, Andrew Lloyd, Statham, Prentice, Zielke, Stephan, Murphy, Poole, Grigor, Switenky, Dupont, Ekiert, Macfarlane, Nerdahl, Pittoors and Travis;

AND WHEREAS Paul Lloyd, on his own behalf and on behalf of Canavista Financial, and Borealis, Synergy, IBC, Smith, Villanti, Haliday and Breau consent to a continuation of the Temporary Order until June 18, 2008;

AND WHEREAS Dickerson consents to an order that trading by her in any securities shall cease and any exemptions contained in Ontario securities law shall not apply to her and to a continuation of that order until June 18, 2008;

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

IT IS ORDERED THAT:

1. trading in any securities by Dickerson, Dupont, Ekiert, Macfarlane, Nerdahl, Pittoors and Travis shall cease and any exemptions contained in Ontario securities law shall not apply to them, and this Order shall be continued until June 18, 2008 or until further order of the Commission;

2. the Temporary Order is continued until June 18, 2008 or until further order of the Commission to provide that trading in any securities of and by the Original Respondents, including Poole, shall cease and that any exemptions contained in Ontario securities law shall not apply to the Original Respondents, including Poole;

3. this matter shall return before the Commission on June 17, 2008 at 10:00 a.m.; and

4. any websites operated by the Original Respondents and the New Respondents, including:

- http://www.borealisfinancial.com

- http://www.borealisglobal.com

- http://www.borealisglobal.com/synergy.htm

- http://www.synergygroup2000.com/Borealis.htm

- http://www.synergygroup2000.com

- http://www.synergywestcoast.com

- http://www.synergygroupbc.com

- http://synergyadvisorforums.com

- http://www.canavista.ca

- http://www.ibc101.com

shall forthwith display the Temporary Order, the Orders dated November 28, 2007 and January 11, 2008 and this Order prominently and continuously on the home page until further order of the Commission.

DATED at Toronto this 27th day of May, 2008.

"Wendell S. Wigle"

"David L. Knight"

Chapter 3 -- Reasons: Decisions, Orders and Rulings

David Berry - s. 21.7

IN THE MATTER OF

THE SECURITIES ACT,

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

AND

IN THE MATTER OF

A REQUEST FOR A HEARING AND REVIEW OF A DECISION OF

A HEARING PANEL OF MARKET REGULATION SERVICES INC.

AND

IN THE MATTER OF

THE UNIVERSAL MARKET INTEGRITY RULES

AND

IN THE MATTER OF

DAVID BERRY

REASONS FOR DECISION

(Section 21.7 of the Securities Act)

REASONS FOR DECISION

I. Background

A. Introduction

[1] This is an application (the "Application") brought by David Berry ("Berry") pursuant to section 21.7 of the Securities Act, R.S.O. 1990, c. S.5, as amended (the "Act") for the Ontario Securities Commission (the "Commission") to conduct a hearing and review of a decision of Market Regulation Services Inc. ("RS"), dated November 8, 2007 (the "RS Disclosure Decision").

[2] The RS Disclosure Decision was made in the context of an RS proceeding (the "RS Proceeding") in which Berry is a respondent. The hearing on the merits was scheduled to commence on April 21, 2008. In the RS Disclosure Decision, the Chair of the RS Panel denied a motion by Berry for disclosure of:

1. all materials relating to prior investigations or reviews by RS Staff of Berry's trading practices while employed at Scotia Capital Inc. ("Scotia") (the "Other RS Files"); and

2. communications and documents relating to settlement negotiations (the "Settlement Materials") conducted by RS Staff with Scotia and Berry's former trading assistant, Marc McQuillen ("McQuillen").

[3] Berry takes the position that the Chair of the RS Panel erred in failing to order disclosure of the requested documents, and asked that the RS Disclosure Decision be set aside and that this Panel order that the requested disclosure be made.

[4] Prior to the Commission hearing, RS agreed to provide the Other RS Files to Berry. Accordingly, at the hearing before the Commission on March 6, 2008, Berry pursued only a review of the RS Disclosure Decision with respect to the Settlement Materials.

[5] Initially, RS brought a motion to quash Berry's Application (the "Motion to Quash") on the grounds that Berry's Application was premature and would fragment the RS Proceeding. Subsequently, RS withdrew the Motion to Quash, and instead, asserted the arguments regarding fragmentation and prematurity by way of a response to the Application.

[6] In light of the fact that the RS Proceeding was scheduled to commence on April 21, 2008, we issued our decision by order dated March 26, 2008 (the "Disclosure Order"). The Disclosure Order provides as follows:

1. Subject to clause 3 below, RS shall provide Berry's counsel access to the Settlement Materials and, if requested, copies thereof for purposes relating to Berry's defence in the RS Proceeding.

2. Disclosure and use of the Settlement Materials will be on the basis that:

(a) Berry and his counsel will not use the Settlement Materials other than in connection with Berry making full answer and defence to the allegations against him in the RS Proceeding;

(b) any use of the Settlement Materials other than in connection with Berry making full answer and defence to the allegations against him in the RS Proceeding will constitute a violation of this Order;

(c) RS shall maintain custody and control over the Settlement Materials so that copies of the Settlement Materials are not disseminated for any purpose other than as contemplated in clause 1 above;

(d) the Settlement Materials shall not be used for any collateral or ulterior purpose; and

(e) Berry and his counsel shall, promptly after the completion of the RS Proceeding and any appeals, return all copies of the Settlement Materials to RS or confirm that they have been destroyed.

3. The foregoing Order is subject to any claim by RS of solicitor-client privilege, or litigation "work product" privilege, and if asserted, the particulars of such a claim shall be set out by RS in a written list and provided to Berry's counsel with the Settlement Materials.

[7] These are our reasons for the Order.

B. The Parties

[8] Counsel for RS, Berry and Staff of the Commission ("Staff") appeared on this Application, and all of the parties provided detailed written and oral submissions.

[9] RS is recognized under section 21.1 of the Act as a self-regulatory organization ("SRO"), and it is responsible for regulating trading on the Toronto Stock Exchange and other marketplaces. RS administers and enforces the Universal Market Integrity Rules ("UMIR") on behalf of the TSX Inc. (the "TSX").

[10] Berry was employed by Scotia from 1996 to 2005 as a trader (non-retail). In 1998, he was appointed Head of Preferred Trading, responsible for trading Scotia's proprietary book of preferred shares under the umbrella of Scotia's institutional equities business.

[11] The only investment dealer that Berry has ever worked for is Scotia. All of Berry's experience as a trader of preferred shares and knowledge of the securities industry rules was acquired from his training at, and work as an employee of, Scotia.

C. Chronology of Events

1. The RS Proceeding Against Berry

[12] In May 2005, a trade desk review (the "Trade Desk Review") was conducted by RS Staff which raised questions regarding various short positions held in Berry's inventory account for the Preferred Share Trading Desk. At that time, Berry was employed at Scotia as the Head of Preferred Trading. After the Trade Desk Review, RS initiated an investigation into the conduct of Scotia, Berry and McQuillen. McQuillen was a fully licensed agency trader who was Berry's assistant on the Preferred Desk at the relevant time.

[13] An RS Proceeding was commenced against Berry by a Notice of Hearing and appended Statement of Allegations on February 20, 2007. An Amended Notice of Hearing was issued by RS on June 12, 2007.

[14] In the Statement of Allegations, RS alleges that Berry solicited client orders during the distribution of new issues by Scotia contrary to UMIR 7.7(5) and conducted off-marketplace trades contrary to UMIR 6.4.

[15] Specifically, in paragraphs 1 and 2 of the Statement of Allegations, RS makes the following allegations with respect to Berry:

RS alleges that between April 4, 2002 and April 18, 2005, [Berry]:

(i) engaged in conduct which resulted in [Scotia] contravening UMIR 7.7(5) (pre-May 2005 version) on 39 occasions; and

(ii) engaged in conduct which resulted in [Scotia] contravening UMIR 6.4 on 15 occasions.

UMIR came into effect on April 1, 2002. Effective January 2004, UMIR was amended to add Section 10.3(4) which provides that an individual employed by a Participant contravening UMIR may be found liable for the conduct and sanctioned accordingly. As a result, from and after January 30, 2004, Berry can be found personally liable for causing [Scotia] to solicit the client orders and conduct the off-marketplace trades referred to herein. In respect of the solicitations, 11 took place after January 30, 2004. In respect of the off-marketplace trades, 10 took place after January 30, 2004.

[16] The allegations relate to conduct by Berry and McQuillen, and are summarized at paragraphs 10 and 11 of the Statement of Allegations as follows:

In the period April 4, 2002 to April 18, 2005 (the "Relevant Period"), Berry and McQuillen engaged in a pattern of trading [...] which consisted of Berry and McQuillen:

(i) soliciting client orders during the distribution of new issues by [Scotia] contrary to UMIR 7.7(5) (as it existed prior to May 2005); and

(ii) conducting off-marketplace trades that were not printed on a marketplace or recognized exchange, contrary to UMIR 6.4.

The Trading involved 16 new issues of preferred shares and 20 different clients.

2. The Settlement Agreements with Scotia and McQuillen

[17] The Trade Desk Review and subsequent investigation also involved the conduct of Scotia and McQuillen in the trades referred to above.

[18] On February 20, 2007, RS gave public notice that an RS Hearing Panel would consider separate settlement agreements between:

1. RS and Scotia on February 26, 2007; and

2. RS and McQuillen on February 28, 2007.

[19] The settlement agreements with Scotia and McQuillen were approved by RS Panels on February 26, 2007 and February 28, 2007, respectively (see: Offer of Settlement in the Matter of Scotia Capital Inc., Market Regulation Services Inc., DN 2007-001, dated February 26, 2007; and Offer of Settlement in the Matter of Marc McQuillen, Market Regulation Services Inc., DN 2007-002, dated February 28, 2007).

[20] According to RS (as set out in its factum), during the settlement negotiations, Berry was kept apprised of the discussions and had knowledge of the following facts:

1. offers to settle with a uniform statement of allegations were sent to counsel for Berry, McQuillen and Scotia and were identified as "without prejudice" offers;

2. settlement negotiations between RS, Scotia, McQuillen and Berry took place with a view to establish an identical form of statement of allegations; it was only the matter of sanctions that varied among the respondents; and

3. Berry had all versions of the statement of allegations that accompanied the offers of settlement that were sent to Scotia and McQuillen, which enabled him to track all changes made by RS during the settlement discussions with the parties.

[21] Berry takes the position that he was not provided with notes made by RS enforcement counsel regarding the settlement discussions with counsel for Scotia and McQuillen. According to Berry, these notes may contain information regarding Berry's relationship with Scotia.

[22] In response, RS takes the position that Berry was given full disclosure of the results of the negotiations with Scotia and McQuillen through the provision of uniform drafts of the statement of allegations that were appended to the respective offers of settlement and the final settlement agreements that were entered into with Scotia and McQuillen.

[23] The settlements for McQuillen and Scotia were not identical. The McQuillen settlement agreement includes the following admitted facts that relate to Berry:

(a) Berry's supervisor during the period 1999 to October 2002 has stated that he was aware of certain aspects of the Trading (as described in paragraph 22 of the Statement of Allegations), as follows, but he did not appreciate that it resulted in clients receiving secondary market shares in the new issue:

i. Berry and/or McQuillen took orders from clients for shares in a new issue during the selling period and filled these orders through sales from the 08 account when the new issue began trading on the TSX.

ii. In some instances, the 08 account would receive an allocation of new issue shares but ultimately incur a short position in the shares of the new issue through sales with clients.

iii. In other cases, a swap transaction with a client's existing position was involved.

(b) The supervisor has stated that he was not aware of instances in which the 08 account sold short shares in the new issue to clients without taking an allocation in the new issue.

[24] In addition, at paragraph 22 of his factum, Berry highlights the following from the evidentiary record:

(a) Scotia agreed that between April 2002 and October 2003, it was liable under UMIR Rule 10.3(1) for contraventions by its former employees, Berry and McQuillen, of UMIR 7.7(5) (pre-May 2005 version) and UMIR 6.4. Scotia agreed to a fine of $571,167 and $67,000 in costs;

(b) McQuillen agreed that between June 2004 and April 2005, he engaged in conduct that resulted in Scotia contravening UMIR 7.7(5) (pre-May 2005 version) and UMIR 6.4. McQuillen was fined $25,000;

(c) RS Staff expressly indicated in the RS Discipline Notices related to Scotia that it was not seeking to hold Scotia liable for any contravention of Scotia's trading supervision obligations under UMIR Part 7.1 in respect of the purported conduct of its employees, Berry and McQuillen, and offered no explanation for this decision;

(d) None of the admitted facts in the Statement of Allegations against Scotia refer to any of Scotia's supervisory obligations, responsibility to appropriately train and educate its employees, or deficiencies relating thereto;

(e) Scotia's fine of $571,167 represented only what it acknowledged was the financial benefit to it on account of the impugned trades; and

(f) Ms. Maureen Jensen (Vice-President, RS, Eastern Region) subsequently commented in several news media reports that she was "pleased that Scotia Capital recognized in this settlement that, even though supervision was not an issue, it would not be appropriate to retain profits generated by the wrongdoing of its employees."

3. Berry's Reply

[25] Berry filed a reply to RS's Notice of Hearing and Statement of Allegations on March 14, 2007 (the "Reply"). The Reply sets out Berry's position and the defences that he will rely on in the RS Proceeding.

[26] Berry pleads in his Reply that, at all times, Scotia was:

1. responsible for supervising his trading and educating him about securities regulatory requirements;

2. directly aware of Berry's trading practices in general, and of the very trades at issue; and

3. expressly advised Berry that the impugned trading was not considered improper.

[27] The position taken in Berry's Reply is that his conduct did not result in Scotia contravening UMIR, but alternatively, that if breaches of UMIR occurred, they were the result of Scotia's own compliance failures (the "Scotia Defence").

[28] For instance, Berry points out in paragraph 9 of his Reply that Scotia was responsible for supervising and educating Berry regarding securities regulatory requirements such as UMIR pursuant to UMIR 7.1 and UMIR Policy 7.1 -- Trading Supervision Obligations, which includes the obligation to:

Ensure that employees responsible for trading in securities are appropriately registered and trained and that they are knowledgeable about the Trading Requirements that apply to their responsibilities. Persons with supervisory responsibility must ensure that employees under their supervision are appropriately registered and trained. The Participant should provide a continuing training and education program to ensure that its employees remain informed of and knowledgeable about changes to the rules and regulations that apply to their responsibilities.

[29] In addition, Berry also explains in his Reply that his trading was fully open and disclosed to Scotia and that trade tickets for the trades were prepared and submitted to Scotia for processing and compliance review. Accordingly, Scotia was aware of Berry's trades and solicitations. Specifically, on this point, Berry's Reply states at paragraphs 10, 13 and 14:

10. [...] Berry was assured by his supervisors that due to the large volume of trading that he was responsible for and the percentage of overall profits that his trading activities generated, Scotia was monitoring his trading closely for regulatory compliance and would alert him if his trading was in breach of any industry rules.

[...]

13. [...] Berry's supervisor at Scotia knew that from time to time Berry sold new issues short to clients from his inventory account without those trades being executed on an exchange. The supervisor did not consider that to be improper. He so advised Berry. Berry was entitled to, and did, rely upon Scotia for such direction.

14. At no time prior to the RS trade desk review in the spring of 2005 did Scotia ever advise Berry that it considered that his trading in new issue shares may contravene UMIR or the TSX Rules, that such trading was inconsistent with industry practice, or that it may be in any other way improper.

[30] Berry's Reply also emphasizes that all his clients were sophisticated institutions, not retail investors. These clients were neither misled, nor were their interests unfairly disregarded. In particular, Berry states in paragraphs 15 and 16 of his Reply that:

15. [His clients] were aware that Berry may take a short position in the stock after listing. The clients received the shares at precisely the price that they bargained for. None ever requested a prospectus, nor would they have acted any differently if they had received one.

16. At all times Berry's purpose in selling short to clients from his inventory account was to support the new issue by having the ability to go long in the stock after trading commenced.

[31] These allegations are in addition to others pleaded in the Reply.

4. Disclosure in the RS Proceeding

[32] On April 4, 2007, RS provided Berry with 19 binders of documents representing RS's disclosure in the RS Proceeding.

[33] On April 19, 2007, Berry's counsel wrote to RS requesting further disclosure. With respect to the Settlement Materials, the April 19, 2007 letter states that RS has failed to provide disclosure of:

All communications with counsel for each of McQuillen and Scotia for the purpose of the settlement discussions now concluded between RS and each of them [...]

[...] In particular, it appears that RS has not produced records of all communications with McQuillen, Scotia and their respective counsel, including notes and memoranda made by RS staff of such telephone calls, meetings, etc. [...]

[34] By letter dated April 20, 2007, RS advised Berry's counsel of RS's position with respect to the Settlement Materials. Specifically, RS took the position that:

[...] settlement communications are conducted on a without prejudice basis. Our position with respect to those communications in relation to [McQuillen] and [Scotia], is twofold. First, any such communications are irrelevant to the case against [Berry]. Second, such communications are the subject of privilege;

[...]

You refer in the body of your letter to communications between RS Staff and McQuillen and [Scotia]. Any such communications forming part of our investigation have been disclosed (with the exception of privileged discussions for the reasons described above).

5. Berry's Motion for Further Disclosure Before RS

[35] Further exchanges of correspondence on the issue of disclosure of the Settlement Materials (among other things) did not resolve the issue. Berry filed a Notice of Motion for further disclosure dated October 15, 2007, returnable November 2, 2007 (the "Motion for Further Disclosure"). In addition to requesting disclosure of the Settlement Materials, Berry's Motion for Further Disclosure also addressed the disclosure of the Other RS Files; however, as stated above, disclosure of the Other RS Files was resolved prior to the hearing of the Application before the Commission.

[36] With respect to the Settlement Materials, in his Motion for Further Disclosure, Berry sought:

All materials provided by or exchanged between RS Staff and each of [Scotia] and [McQuillen], but not limited to, settlement negotiations with RS Staff.

[37] Berry's Motion for Further Disclosure was brought on the grounds that disclosure is necessary to permit Berry to make full answer and defence in the RS Proceeding. Berry argued that RS must disclose any document or other materials (including the Settlement Materials) if they are relevant; that is, they may be of some use or have a reasonable possibility of assisting Berry to rebut the allegations, advance any possible defence, or make any tactical or other decision that could affect the conduct of the RS Proceeding. In particular, Berry requests disclosure of the Settlement Materials to permit him to:

[...] make tactical decisions, including, (i) deciding which individuals to interview, (ii) making decisions about who to call as witnesses, (iii) determining a strategy for impeachment of witnesses; and (iv) other strategic choices;

[...]

[address] aggravating, mitigating and other factors, if the Allegations are ultimately proven true, for the purposes of lessening any sanction.

[38] Berry's factum also clarified at paragraph 23 that Berry requested disclosure of the Settlement Materials on the basis that:

(a) Berry reasonably anticipates that McQuillen and representatives of Scotia will be key witnesses at the hearing;

(b) All communications between Scotia and RS, and McQuillen and RS, including those relating to settlement, are clearly relevant to the Scotia Defence pleaded by Berry; and

(c) Information in these documents may inform decisions made by Berry concerning the conduct of his defence, including the identification of witnesses and the conduct of cross-examination.

6. The RS Disclosure Decision

[39] On November 8, 2007, the RS Disclosure Decision was issued, dismissing Berry's Motion for Further Disclosure.

[40] At the outset of his decision, the Chair of the RS Panel stated that:

[...] both parties agree that RS has a duty to disclose all relevant facts to the Respondent. In any case, the law on this point is well settled, and I see no need to elaborate on this. What is disputed, however, is the relevance of certain documents, and whether or not the rules of disclosure require their production. That is the issue now before me. (RS Disclosure Decision, dated November 8, 2007 (unreported) at 1.)

[41] In canvassing the issue, the Chair of the RS Panel stated:

Disclosure obligations are high. Fairness demands this, and the case law is clear on the point. Stinchcombe, [1991] 3 S.C.R. 326, is now regularly followed, but while the rule is clear, its application may, at times be difficult. For instance, as was pointed out by the British Columbia Securities Commission in Fernback, [2004] B.C.S.C.D. No. 809, October 29, 2004, "it is not possible to rule definitively that any category of documents is or is not disclosable. It depends on their content." (RS Disclosure Decision, supra at 3.)

[42] With respect to the Settlement Materials, the Chair of the RS Panel observed that Berry sought disclosure of all the files relevant to the Scotia and McQuillen settlement agreements and noted:

[...] the Respondent would like to be enlightened about information relating to the 2005 Scotia/[McQuillen] Investigation Material which RS Staff considered privileged. His position is that "[a]ny privileged documents exchanged by Scotia or [McQuillen] with RS Staff must be listed in the Undisclosed Documents List (Schedule A) along with the privilege asserted. Otherwise the document must be delivered. (RS Disclosure Decision, supra at 4 and 5.)

[43] The RS Disclosure Decision also sets out the general principle that settlement communications are not usually disclosed:

RS submits that what was not provided to the Respondent were settlement communications between the parties which are privileged. I accept that assurance, and I agree that, according to well-established principles (as stated, for instance, in Sopinka, Lederman and Bryant, The Law of Evidence in Canada, 2nd ed., Butterworths, 1999, pp. 807 & ff) such communications need not be disclosed. (RS Disclosure Decision, supra at 5.)

[44] The Chair of the RS Panel came to the following conclusion:

Insofar as the Scotia/McQuillen materials are concerned, for reasons stated before, I do not consider them relevant. This will not, of course, prevent the Respondent from his right to fully cross-examine any witness about the possible benefits derived from a settlement agreement and which may have a bearing on his or her testimony. The results of the settlement agreements with Scotia and McQuillan are known to the Respondent. Whether or not discussions which preceded them can be brought out at the hearing will be a matter for the hearing panel. (RS Disclosure Decision, supra at 6.)

[45] In his reasons, the Chair of the RS Panel did not refer to Berry's Reply, and in particular, the position Berry takes in his defence that Scotia had greater knowledge of, and involvement in, the impugned activities than is suggested in the settlement agreements.

D. Berry's Application Before the Commission

[46] On November 26, 2007, Berry filed his Application before the Commission for a hearing and review of the RS Disclosure Decision pursuant to section 21.7 of the Act.

[47] The Application pertains to the disclosure of the following documents:

1. all materials relating to any investigation or review of Berry's trading practices by RS other than the RS investigation of Berry's trading practices between May 2, 2005 and February 2007;

2. all investigation reports prepared by RS Staff in connection with the 2005 RS Investigation;

3. all materials relating to settlement negotiations between RS Staff and each of McQuillen and Scotia; and

4. unredacted copies of any contracts and/or agreements between TSX and RS relating to the provision of market regulation services by RS.

[48] As stated earlier in these Reasons, Berry no longer seeks access to the materials referred to in items 2 and 4 listed above. In addition, RS provided Berry with the materials requested in item 1 above. Therefore, only the disclosure of the Settlement Materials is currently at issue.

[49] With respect to the Settlement Materials, in his Application Berry takes the position that the RS Disclosure Decision should be set aside for the following reasons:

1. RS failed to compel the disclosure of the Settlement Materials, which are highly relevant to the Scotia Defence pleaded in Berry's Reply. Disclosure is necessary to permit Berry to make full answer and defence;

2. RS erred in law by applying an incorrect and unduly onerous standard of disclosure;

3. RS erred in law in holding that privilege attached to the Settlement Materials;

4. RS further erred in holding that, even if privilege did apply, it should not be set aside in order to permit Berry to make full answer and defence.

[50] According to Berry, RS's refusal to provide disclosure of the Settlement Materials is unfair to Berry and is contrary to the principles of natural justice.

[51] RS and Staff of the Commission submit that there is no reason to interfere with the RS Decision and, in any event, that the Request for Hearing and Review is premature.

II. The Issues

[52] The following issues arise from the Application and the responses thereto:

(a) What is the Commission's role under section 21.7 of the Act and what approach should be taken by the Commission when asked to review a preliminary decision of an SRO, in the context of an ongoing SRO proceeding?

(b) Are there good and sufficient reasons to set aside the RS Disclosure Decision in response to the Application?

(i) In particular, are the Settlement Materials relevant to the RS Proceeding?

(ii) Are the Settlement Materials privileged?

(iii) Are there compelling reasons to override any asserted privilege to ensure fairness to Berry in all of the circumstances?

III. Analysis

A. What is the Commission's Role under Section 21.7 of the Act and What Approach Should be Taken by the Commission when Asked to Review a Preliminary Decision of an SRO, in the Context of an Ongoing SRO Proceeding?

1. Legislative Authority

[53] A hearing and review of a decision of an SRO such as RS is governed by section 21.7 of the Act. That section provides as follows:

Review of decisions

21.7 (1) The Executive Director or a person or company directly affected by, or by the administration of, a direction, decision, order or ruling made under a by-law, rule, regulation, policy, procedure, interpretation or practice of a recognized stock exchange, recognized self-regulatory organization, recognized quotation and trade reporting system or recognized clearing agency may apply to the Commission for a hearing and review of the direction, decision, order or ruling.

Procedure

(2) Section 8 applies to the hearing and review of the direction, decision, order or ruling in the same manner as it applies to a hearing and review of a decision of the Director. [Emphasis added]

[54] Subsection 8(3) of the Act sets out the Commission's powers on review as follows: "Upon a hearing and review, the Commission may by order confirm the decision under review or make such other decision as the Commission considers proper."

2. The Approach to be Taken by the Commission

[55] All of the parties agreed that in exercising its powers of review, the Commission exercises original jurisdiction (as opposed to a limited appellate jurisdiction) and is free to substitute its judgment for that of the SRO. (Re Investment Dealers Assn. of Canada (2007), 30 O.S.C.B. 4739 at paras. 29 and 30.)

[56] As stated in the recent Commission decision in Re Investment Dealers Assn. of Canada:

In this regard, such a hearing and review may be considered broader in scope than an appeal, which is usually limited to determining whether there has been an error in law or whether a rule of natural justice has been contravened. (Re Investment Dealers Assn. of Canada, supra at para. 31.)

[57] Berry's written submissions emphasize that pursuant to sections 21.7 and 8(3) of the Act, the Commission has supervisory jurisdiction over SROs such as RS, and that the Commission has the power to review, confirm or make other decisions. As a result, in exercising its jurisdiction under these sections, the Commission is free to substitute its judgment for that of the SRO. Berry's written submissions point out that the Commission's review powers are broader in scope than an appeal, which is restricted to determining whether there has been an error in law or whether a rule of natural justice has been contravened.

[58] On the other hand, RS and Staff submit that in practice, the Commission should take a "restrained approach", whereby the Commission should not substitute its own view just because it might have reached a different conclusion on the particular facts at issue, and will only interfere in very limited circumstances. (Re Investment Dealers Assn. of Canada, supra at para. 33.) Statements made in a number of cases support this principle. For example, in Re Shambleau (2002), 25 O.S.C.B. 1850 at 1852 and in Security Trading Inc. and the Toronto Stock Exchange (1994), 17 O.S.C.B. 6097 at 6105, the Commission emphasized that the fact that the Commission might disagree or render a different decision on the facts is an insufficient reason to substitute its decision for that of the Board or Exchange. (See also: Re Malting (1986) 9 O.S.C.B. 3565 at 3587, and Re Boulieris (2004), 27 O.S.C.B. 1597 at para. 31.)

[59] These cases suggest that the Commission should only interfere with a decision of an SRO if one of the following grounds is present:

1. the SRO has proceeded on an incorrect principle;

2. the SRO has erred in law;

3. the SRO has overlooked some material evidence;

4. new and compelling evidence is presented to the Commission that was not presented to the SRO; or

5. the SRO's perception of the public interest conflicts with that of the Commission.

(Re Investment Dealers Assn. of Canada, supra at para. 32.)

[60] Berry argues that while deference is often afforded to factual determinations made by an SRO, the Commission will nevertheless intervene if the SRO acts unfairly. We note that the Commission has indicated that it would intervene in respect of an SRO's decision if the SRO's discretion was not exercised fairly; for example, where the Commission finds there was no evidence upon which the SRO's conclusions could be supported. (Security Trading Inc. and the Toronto Stock Exchange, supra at 6105.)

[61] In this case, Berry submits that little deference should be afforded to any findings of fact by RS, for a number of reasons including that the Commission has the expertise to make findings of fact regarding disclosure.

[62] In our view, the positions of RS and Berry are both correct. Although the statute provides the Commission with broad powers of review, the Commission has repeatedly emphasized the "restrained approach" urged upon us by Staff and RS. Such restraint is desirable to ensure that SROs have adequate control and direction over their own processes and procedures, and that they are not unduly hampered by interruptions caused by parties seeking a "second opinion" in the midst of an ongoing SRO regulatory proceeding. On the other hand, when approaching matters such as the one before us, the Commission can, and should, as Berry has submitted, consider the impact the reviewed decision has on the fairness to the applicant and whether the Commission's intervention would facilitate rather than interfere with the SRO process.

[63] We also agree with Berry that the nature and characteristics of the specific issue in dispute is relevant to this analysis. It is true that an RS Panel ought to be master of its own process and procedures, in a manner similar to this Commission in regard to its own proceedings. However, RS does not have unique or special expertise or jurisdiction with respect to disclosure issues and it is appropriate for the Commission to exercise its oversight powers to ensure procedural fairness in the RS Proceeding. Assessments and reviews of those matters should be measured against practices and principles articulated in law. In situations where the decision under review deals specifically with an issue squarely within an SRO's expertise or jurisdiction, higher deference should be accorded to the SRO.

B. Are There Good and Sufficient Reasons to Set Aside the RS Disclosure Decision in Response to the Application?

[64] The relevant issue before the Chair of the RS Panel related to disclosure of the Settlement Materials. As the Chair of the RS Panel noted, "RS has a duty to disclose all relevant facts to the Respondent. [...] What is disputed, however, is the relevance of certain documents, and whether or not rules of disclosure require their production."

[65] Full, fair and timely disclosure is key to ensuring procedural fairness to respondents in regulatory enforcement proceedings. As stated in Re Ironside, [2005] A.S.C.D. No. 910 at para. 29:

Allegations of inadequate disclosure, when raised, strike at one of the core principles of natural justice -- ensuring that a respondent has an adequate opportunity to be heard. In the securities regulatory context, that includes knowing the case to be met and being able to make full answer and defence.

[66] It is no longer disputed that in disciplinary proceedings where the consequences of the outcome can be severe to a respondent, such as those before RS, principles of natural justice and fairness require a high standard of disclosure akin to that required in criminal trials. Accordingly, principles articulated by the Supreme Court of Canada in R. v. Stinchcombe, [1991] 3 S.C.R. 326 ("Stinchcombe"), have been applied in securities regulatory proceedings. (See for example: Re Fernback, [2004] B.C.S.C.D. No. 966; Ontario (Securities Commission) v. Shambleau, [2003] O.J. No. 4089 (Ont. Div. Crt.); Re Ironside, supra; and Deloitte & Touche LLP v. Ontario (Securities Commission), [2002] S.C.J. No. 62.)

[67] It is important that a high duty of procedural fairness be accorded to a respondent in disciplinary and other enforcement proceedings where the allegations are serious and the outcome has significant consequences for an individual. In his dissent in Howe v. Institute of Chartered Accountants of Ontario, 19 O.R. (3d) 483, Laskin, J.A. emphasized at 495:

Discipline proceedings are near the judicial end of the spectrum of administrative decision-making. Therefore they call for disclosure that exceeds the minimum requirements of s. 8 of the Statutory Powers Procedure Act and that approaches the kind of disclosure applicable in court proceedings. To use Dickson J.'s phrase in Kane v. Board of Governors of the University of British Columbia, supra, at p. 1113, discipline proceedings require a "high standard of justice". The reason is obvious. Discipline proceedings may have serious consequences on a person's livelihood, reputation and professional career. For some professionals, a finding of professional misconduct is more serious than a criminal conviction: see Re Emerson and Law Society of Upper Canada (1983), 44 O.R. (2d) 729 at p. 744, 5 D.L.R (4th) 294 (H.C.J.).

[68] Laskin, J.A.'s opinion in Howe is often referred to when considering the standard of disclosure in regulatory enforcement proceedings. (See for example: Ontario (Securities Commission) v. Shambleau, supra, and Re Glendale Securities Inc. (1995), 18 O.S.C.B. 5975.) It is clear from the case law, and agreed upon by all parties in their submissions, that a "Stinchcombe"-like standard is applicable to disciplinary and other regulatory enforcement proceedings.

[69] In R. v. Taillefer, [2003] 3 S.C.R. 307, the Supreme Court of Canada summarized the Stinchcombe standard as originally articulated by the Court and as interpreted and applied in subsequent decisions at paras. 59-60:

After a period during which the rules governing the Crown's duty to disclose evidence were gradually developed by the provincial appeal courts in recent decades, those rules were clarified and consolidated by this Court in Stinchcombe. The rules may be summarized in a few statements. The Crown must disclose all relevant information to the accused, whether inculpatory or exculpatory, subject to the exercise of the Crown's discretion to refuse to disclose information that is privileged or plainly irrelevant. Relevance must be assessed in relation both to the charge itself and to the reasonably possible defences. The relevant information must be disclosed whether or not the Crown intends to introduce it in evidence, before election or plea (p. 343). Moreover, all statements obtained from persons who have provided relevant information to the authorities should be produced notwithstanding that they are not proposed as Crown witnesses (p. 345). This Court has also defined the concept of "relevance" broadly, in R. v. Egger, [1993] 2 S.C.R. 451, at p. 467:

One measure of the relevance of information in the Crown's hands is its usefulness to the defence: if it is of some use, it is relevant and should be disclosed -- Stinchcombe [at page 345]. This requires a determination by the reviewing judge that production of the information can reasonably be used by the accused either in meeting the case for the Crown, advancing a defence or otherwise in making a decision which may affect the conduct of the defence such as, for example, whether to call evidence.

As the courts have defined it, the concept of relevance favours the disclosure of evidence. Little information will be exempt from the duty that is imposed on the prosecution to disclose evidence. As this Court said in [R. v. Dixon, [1998] 1 S.C.R. 244], 'the threshold requirement for disclosure is set quite low.... The Crown's duty to disclose is therefore triggered whenever there is a reasonable possibility of the information being useful to the accused in making full answer and defence.' (para. 21; see also R. v. Chaplin, [1995] 1 S.C.R. 727, at paras. 26-27). 'While the Crown must err on the side of inclusion, it need not produce what is clearly irrelevant' (Stinchcombe [at page 339]).

[70] In Re Ironside, the Alberta Securities Commission noted that the low threshold for relevance affords a broad right to disclosure and encompasses information that "may appear to have only limited value to the issues for determination" in the proceeding (at para. 35). For instance, documents which might appear irrelevant to staff may have considerable relevance for the purposes of defending allegations when viewed in light of other information possessed by the respondent. (Re Fernback, supra at para. 35.) Relevant information for the purposes of making full answer and defence includes material that the respondents could use to rebut the case presented by staff, material they could use to advance a defence, and material that may assist them in making tactical decisions. (See Deloitte & Touche LLP v. Ontario (Securities Commission), [2002] O.J. No. 2350 (Ont. C.A.) ("Deloitte CA") at para. 40.)

[71] In Deloitte CA, the Court further noted that relevance is to be considered by reference to the allegations against the respondent, such that "relevance occurs where the nature of the allegations and the contents of the material in possession of Staff intersect" (at para. 44).

[72] Practically, the determination of relevance in the context of a criminal proceeding is made by reference to the allegations set out in the information or indictment; and, in a Commission proceeding commenced pursuant to section 127 of the Act, it is made by reference to Staff's statement of allegations and the issues raised by it. In the context of civil litigation in Ontario, a defendant's statement of defence can also clearly raise issues that relate to relevance. As is the case in civil proceedings, relevance in RS proceedings can be more readily assessed by reference to the issues raised in both RS's statement of allegations and the respondent's reply, and due regard to those documents should be had when assessing relevance for disclosure purposes.

1. Relevance of Settlement Materials

[73] Berry submits that the Chair of the RS Panel erred in law by not applying the Stinchcombe standard correctly and by concluding that the Settlement Materials were not relevant. He argues that had the Chair of the RS Panel turned his mind to the allegations and his pleadings, the Settlement Materials would clearly have been found relevant. RS agrees with Berry's counsel that Stinchcombe was the correct standard, but argues that the Chair of the RS Panel met the standard in concluding that the requested materials were not relevant in light of the pleadings.

[74] RS's Statement of Allegations claims that Berry engaged in a pattern of trading over a three-year period that resulted in Scotia violating UMIR. The basis upon which Berry is personally liable is set out in paragraph 2 of the Statement of Allegations:

UMIR came into effect on April 1, 2002. Effective January 30, 2004, UMIR was amended to add Section 10.3(4) which provides that an individual employed by a Participant who engages in conduct resulting in the Participant contravening UMIR may be found liable for the conduct and sanctioned accordingly. As a result, from and after January 30, 2004, Berry can be found personally liable for causing Scotia Capital to solicit the client orders and conduct the off-marketplace trades referred to herein. In respect of the solicitations, 11 took place after January 30, 2004. In respect of the off-marketplace trades, 10 took place after January 30, 2004. [Emphasis added.]

[75] In Berry's Reply to the Statement of Allegations, Berry claimed that the contraventions of UMIR were actually a result of Scotia's own compliance failures. The Reply outlined Berry's position that the trading at issue was conducted in a manner that was consistent with his training and experience with Scotia, that any knowledge he had of securities regulations would have been solely acquired from Scotia, and that Scotia had obligations under UMIR 7.1 to supervise and educate him about regulatory requirements. Further, Berry pleaded that Scotia was monitoring his trading and knew of the very trades at issue. He claimed that he was never advised that his trading contravened UMIR, but rather relied on his supervisor's advice that his trading practices were not improper.

[76] Based on the Statement of Allegations and Berry's Reply, it is clear that issues about Scotia's knowledge of Berry's trading and what Berry was advised about its propriety will be raised in the RS Proceeding. Berry's position that the breaches of UMIR resulted from Scotia's failure to properly supervise him would also raise issues about the adequacy of Scotia's supervision and training of Berry and how closely Scotia was monitoring compliance with UMIR.

[77] On the basis of the allegations, Berry submits that he could only be held liable if it was found that he caused Scotia to breach UMIR. Since section 10.3(4) enables an individual to be held responsible for contraventions of UMIR in place of the employing firm, the nature of the provision allows the firm to shift blame onto the individual. Specifically, section 10.3(4) of the UMIR states:

Any officer or employee of a Participant or Access Person or any individual holding a similar position with a Participant or Access Person who engages in conduct that results in the Participant or Access Person contravening a Requirement may be found liable by the Market Regulator for the conduct and be subject to any penalty or remedy as if such person was the Participant or Access Person.

[78] A central question therefore in the RS Proceeding, directly raised by the "pleadings", is whether it was Berry's conduct that caused Scotia to breach UMIR, or whether there was some other cause.

[79] Berry further submits that the Settlement Materials are relevant and necessary for him to make full answer and defence, in light of the following:

• The RS Discipline Notices accompanying the settlement agreement between RS and Scotia explicitly states that proceedings in respect of Scotia's supervision of Berry and McQuillen were not taken by RS. There is no information, however, that addresses why Scotia was not held responsible for failing to supervise Berry under UMIR.

• The agreed facts in the settlement agreement entered into between RS and Scotia do not refer to Scotia's supervisory obligations, and the agreed sanctions represent a simple disgorgement of financial benefits obtained by Scotia through Berry's trading. The penalties do not seem to reflect any liability for the trading that occurred after UMIR 10.3(4) came into effect, when Berry could be held personally liable for the contraventions.

• McQuillen's settlement agreement had a provision not mentioned in the settlement agreement between RS and Scotia regarding some knowledge of supervisors at Scotia of the trading conducted by McQuillen and Berry.

• There were comments in the news media by RS expressing that Scotia's supervisory obligations were not at issue. It further indicated that the types of trades engaged by McQuillen were known by Scotia and his supervisor.

[80] RS submits that the materials sought by Berry are not relevant because they are not necessary for Berry to make full answer and defence. It is claimed that the "fruits of the investigation" have already been disclosed, including any information regarding what Scotia and McQuillen told RS about the allegations against Berry and against themselves. Berry was provided with drafts of the offers of settlement and all the versions of the accompanying statement of allegations. The only information not disclosed regarding the settlement agreements were the notes made by RS enforcement counsel during their discussions with counsel for Scotia and McQuillen.

[81] RS further submits that the issues raised by Berry with respect to Scotia's supervisory obligations would not absolve him of any liability, but at best may mitigate any sanctions that might be imposed. Further, RS submits that Berry admitted to the trades at issue, and Scotia and McQuillen are not necessary to prove the allegations. RS also submits that if they were not called as witnesses at the hearing, then their settlement communications with RS could not possibly be relevant and this would also eliminate any issues of credibility.

[82] It is apparent that Scotia's role and knowledge of the trading at issue were at least considered by RS, but there is no additional information as to why there was no reference to those issues in the settlement agreements. It is reasonable to expect that those types of issues and facts would have been discussed during the negotiation discussions between RS and Scotia and between RS and McQuillen in reaching a settlement. It is also possible that there may be issues of credibility as to their positions.

[83] Counsel for Berry submits that employees of Scotia will be witnesses at the hearing, and at a minimum, that Berry would be calling McQuillen as a witness if RS does not. Further, Berry's purpose in seeking disclosure of the Settlement Materials is to assess the positions that Scotia and McQuillen advanced in their settlement discussions with RS. This would assist Berry in making decisions about whether to call representatives of Scotia to testify. For example, the changes to settlement documents proposed by Scotia that RS did not accept in the final agreement would be outside what was already disclosed regarding the offers of settlement.

[84] In our view, any information given by Scotia and McQuillen to RS about the allegations against Berry and against themselves will be relevant to Berry's defence. We accept, at the very least, that the communications between RS and Scotia and McQuillen may be helpful to Berry in making strategic and informed decisions regarding which witnesses to call and how to conduct his defence.

[85] The Chair of the RS Panel concluded that the Settlement Materials were not relevant; however, he made no reference to Berry's Reply or how it related to the nature of the allegations. We recognize that critical issues in the RS Proceeding will include whether Berry caused Scotia's violation of UMIR and if Berry did so, whether it was a result of Scotia's failure to fulfill its supervisory obligations. Given the nature of UMIR 10.3(4) and the fact that an individual can be held personally liable under that provision, any discussions of the parties with RS relating to the violations would be relevant. Even if the Settlement Materials are not clearly relevant, at the very least, we are of the view that they are not "plainly irrelevant", as emphasized in Taillefer, supra at 59. Further, to paraphrase the words of the Supreme Court in Eggers, supra at 467, we are satisfied that the information requested can reasonably be used by Berry to meet the case RS presents, advance his defence, or to otherwise make decisions which may affect the conduct of his defence.

[86] As stated above, disclosure goes to the root of fairness to a respondent, and a failure to provide the respondent with relevant information and material in advance of the commencement of the proceeding, could undermine the fairness of the RS Proceeding.

[87] Having reached that conclusion, the issue that remains to be considered is whether there is any valid reason why the Settlement Materials should not be disclosed to Berry.

2. Settlement Privilege

[88] Communications in the course of negotiations toward a settlement are generally privileged and protected from disclosure and admissibility into evidence. As stated by Sopinka et al. in The Law of Evidence in Canada:

It has long been recognized as a policy interest worth fostering that parties be encouraged to resolve their private disputes without recourse to litigation, or, if an action has been commenced, encouraged to effect a compromise without resort to trial...

In furthering these objectives, the courts have protected from disclosure communications, whether written or oral, made with a view to reconciliation or settlement. In the absence of such protection, few parties would initiate settlement negotiations for fear that any concession they would be prepared to offer could be used to their detriment if no settlement agreement was forthcoming... (John Sopinka, Sidney N. Lederman, and Alan W. Bryant, The Law of Evidence in Canada (2nd edition) (Markham: Butterworths, 1999) at 807 and 808.)

[89] Such a privilege, however, is not absolute and it is often set aside to address other concerns such as procedural fairness. Berry's position is that in this case, the right to make full answer and defence requires that disclosure of the Settlement Materials be made notwithstanding the general principle that such material is privileged.

[90] A number of decisions in the criminal, civil and administrative contexts have made exceptions to settlement privilege in certain circumstances. Generally, courts will attempt to balance all of the interests at stake. This may include balancing the right of an accused to a fair hearing or the right to make full answer and defence, with the encouragement of settlement. In this balancing approach, all of the relevant circumstances must be considered.

[91] A relevant circumstance considered by courts and tribunals is whether a plea bargain or settlement information relates to an individual who would likely be an important witness at the hearing of the matter. Berry's counsel relied on a number of criminal cases. While a number of these cases were decided in their own particular, and perhaps unique, factual circumstances, the underlying approach is informative.

[92] In the context of a criminal proceeding, the Court in R. v. Bernardo, [1994] O.J. No. 1718 (Ont. Gen. Div.), set aside settlement privilege attached to plea negotiations with the Crown in order to allow the accused to make full answer and defence. In that case, the accused was charged with murder and sought disclosure of the Crown's files regarding the plea negotiations with Karla Homolka, who had pleaded guilty to manslaughter for her participation in the same crimes. It was anticipated that Homolka would be a key witness in Bernardo's trial and the accused submitted that the information requested was necessary for his defence:

[...] those discussions form an integral part of her decision to supply the Crown with information and to testify as she is expected to do at the accused's trial. Further that they are entitled to cross-examine her not only on the agreement arrived at, but the discussions that led up to the agreement so that the jury will be in a position to assess her credibility by having a complete and thorough knowledge of discussions that may have motivated her to enter into that agreement. (R. v. Bernardo, supra at para. 6.)

[93] I n R. v. Delorme, [2005] N.W.T.J. No. 51 (N.W.T. Sup. Ct.), another criminal case, the accused was one of four individuals originally charged with murder. The accused sought production of documents relating to the negotiations of the three other accused who had pleaded guilty and negotiated plea bargains with the Crown. The Court in that case ordered disclosure of the information relating to the plea negotiations of the two witnesses who were likely to testify on the basis that the information would be potentially useful for testing the credibility of those witnesses and their motivations for entering into the plea bargain. On the other hand, the documents relating to the individual whom there was no intention to call as a witness remained privileged. The Court also viewed it important that the protected information had some potential to provide the accused with added information not already or otherwise available to the defence, or had some potential impeachment value. (R. v. Delorme, supra at para. 46.)

[94] In the securities context, the Commission in Re Glendale Securities Inc., supra, came to a similar conclusion in ordering disclosure of settlement discussions between a respondent and Commission staff. The fact that the witness in question was a respondent who settled and that this respondent was expected to be a critical witness against the remaining respondents who did not settle, was an important consideration in concluding that the balance favoured disclosure. The Commission stated in that decision:

[...] it was a fair inference that this may well be a case where someone who was vulnerable to a significant penalty was attempting to obtain immunity or a lesser penalty by trying to shift the blame to someone else, that this clearly would be important to Mr. Parr's credibility, and that Mr. Parr, from the material produced by the Commission staff to the Respondents, appears to be a critical witness to [Staff's] case. (Re Glendale Securities Inc., supra at 5980.)

[95] In Glendale, supra, in the Commission's view, it was possible that credibility might be at issue. Accordingly, what took place in settlement discussions might be relevant, and fairness required allowing the respondent to test the evidence by cross-examination. Quoting from R. v. Ross, [1995] O.J. No. 2582 (Ont. Gen. Div.), the Commission accepted that:

If the disputed material may prove the defendant's innocence or avoid a miscarriage of justice, then the balance comes down resoundingly in favour of disclosing it. (Re Glendale Securities Inc., supra at 5983.)

[96] Further, courts and tribunals have found that the policy rationale behind settlement privilege may not apply in circumstances where the individual who entered into a settlement is a key witness in proceedings related to a third party, and the witness is no longer at risk of prejudice from disclosure of the privileged information. For example, in R. v. Bernardo, supra, while it was recognized that there is a public interest in protecting plea negotiations between an accused and the Crown to encourage full, frank and private negotiations and to encourage the resolution of cases, the privilege is usually applied so that the information disclosed will not be used against the person who has entered into the plea bargain. The Court in that case made a distinction where the information being sought was for use in the defence of another person:

[...] Although I readily accept the Crown's position that a privilege ought to exist in the sense that the information should not be used against her in a subsequent prosecution, I do not conclude that the "privilege" ought to extend when that person, i.e. Ms. Homolka, is not an accused nor is at any risk of prejudice. In this circumstance, it is intended that she testify on behalf of the Crown, putting another at penal risk.

Assuming that a privilege does attach to these negotiations, that privilege ought not to extend to an agreement that requires the person to be a witness against another when, as here, she will be a witness for the Crown. (R. v. Bernardo, supra at paras. 17-18.)

[97] The Court in R. v. Delorme also considered it important that the party who successfully negotiated the plea bargain was no longer at risk of prejudice from the disclosure (at para. 30).

[98] In R. v. Murray (2000), W.C.B.J. 514773 (Ont. S.C.J.) (QL) ("Murray"), the Court considered whether solicitor-client privilege should be set aside. This was another case arising from the Bernardo prosecution where his first counsel was charged with obstruction of justice as a result of his conduct in that case. At the time of the trial, Bernardo had already been convicted of murder and had failed in his appeals. The Court therefore concluded that any prejudice Bernardo might suffer by way of invasion of his privilege would be "largely theoretical". On the other hand:

[...] Mr. Murray's ability to defend himself on this serious charge is threatened and indeed his very liberty is at stake. There is no doubt that Mr. Bernardo's privilege must give way to the overwhelming importance of Mr. Murray's right to full answer and defence. (R. v. Murray, supra at 3.)

[99] Even though solicitor-client privilege is considered the "highest privilege recognized by the courts", the Court found that this right was not absolute and in certain circumstances must yield to another person's right to make full answer and defence.

[100] Berry's counsel also submits that there is a lower expectation of privacy in regulatory proceedings such that the right to make full answer and defence outweighs a witness' right to keep details regarding the settlement agreement confidential. As support for this proposition, it is submitted that settlement agreements in connection with regulatory proceedings are usually made public once they are approved, whereas in civil proceedings, terms of settlement are generally not made public.

3. Are there Compelling Reasons to Override any Asserted Privilege to Ensure Fairness to Berry in all the Circumstances?

[101] We find that the principles described above, as articulated in these cases are relevant to the case before us. Although we recognize that this is an administrative proceeding, we accept that broad principles from the criminal context assist in our analysis. In these circumstances, Scotia and McQuillen entered into settlement agreements with RS and are likely to be witnesses against Berry in connection with the same conduct. As stated in the Statement of Allegations at paragraph 3, "[o]nly Scotia can be found liable for conduct occurring prior to January 30, 2004 which resulted in a breach of UMIR 6.4 or 7.7(5)". The effect is that after January 30, 2004, Berry and McQuillen can be held personally liable for causing the conduct contravening UMIR pursuant to UMIR 10.3(4). Essentially, blame shifted from Scotia to Berry and McQuillen. The positions advanced by Scotia in the negotiations are necessarily at issue, and concerns of credibility and motivation for entering into a settlement agreement cannot be ignored. In these circumstances where Berry intends to challenge the allegations against him, such information may be helpful in preparing his cross-examination or conducting his defence.

[102] RS submits that Bernardo was a case where Homolka was agreeing to be a witness against Bernardo in exchange for her testimony and was negotiating a deal based on the strength of that testimony. In our view, while the circumstances here may be different, we find that the allegations against Berry are so closely tied to the substance of the settlement agreements (the allegations are almost identical) that, on balance, any settlement privilege must give way to Berry's right to make full answer and defence.

[103] RS also submits that the circumstances of this case do not justify overriding the strong policy rationale behind settlement privilege. RS submits, for example, that it could cause a chilling effect on the ability of RS to conclude settlements with multiple respondents. Although we recognize that there is a strong public interest in protecting settlement privilege, we also accept that the underlying policy considerations are not necessarily the same for proceedings involving third parties. The settlement agreements are already concluded between RS and Scotia, and RS and McQuillen. There is no evidence before us that Scotia or McQuillen would be prejudiced in subsequent proceedings by disclosure, especially since Berry was ordered to use the Settlement Materials only for the purposes of the RS Proceeding and no other proceeding. We agree with the Court in Murray, supra, that any prejudice to Scotia or McQuillen would be "largely theoretical" and must yield to the overwhelming importance of Berry's right to a fair hearing and a proper opportunity to defend himself.

[104] It should also be noted that the test for disclosure is not whether the information or documents would be ultimately admissible at a trial, but whether they are relevant (or even, not clearly irrelevant):

Whether they would be admissible during the course of a trial is a matter upon which I choose not to speculate at this point. But whether or not they are admissible in evidence is not necessarily determinative of whether or not that information is relevant [...]

Whilst I agree with all of [the] submissions by the Crown, I am of the view that those inherent weaknesses and frailties of the information not to preclude the defence from having access to them in pursuit of their right to make full answer and defence. Even if it never becomes evidence, it is relevant. (R. v. Bernardo, supra at paras. 8, 11 and 14.)

[105] We accept that although there may be information produced that may not be admissible in the RS Proceeding, this information might still be helpful in informing Berry of the best strategy to be taken in the defence of the allegations against him.

C. Is the Application Premature?

1. Prematurity and Fragmentation

[106] RS and Staff both made submissions with respect to prematurity and fragmentation. In fact, RS initially brought a motion to quash Berry's Application on the grounds that it was premature and would fragment the proceeding, as the RS Panel has not had an opportunity to properly and effectively perform its function, and the Application could potentially protract and delay the hearing process. Subsequently however, RS asserted these submissions by way of a response to the Application.

[107] The general legal principles regarding prematurity are set out in Ontario College of Art et al. v. Ontario Human Rights Commission (1992), 11 O.R. (3d) 798 (Div. Ct.) at 799-800:

[A court has] a discretion to exercise in matters of this nature. It can refuse to hear the merits of such an application if it considers it appropriate to do so. Where the application is brought prematurely, as alleged by the Attorney General in these proceedings, it has been the approach of the Court to quash the application, absent the showing of exceptional or extraordinary circumstances demonstrating that the application must be heard: see Latif v. Ontario (Hospital Resources Commission) (an unreported decision of this court of March 11, 1992; leave to appeal was denied on June 8, 1992 by the Ontario Court of Appeal) and Hancock v. Ontario (Human Rights Commission) (an unreported decision of this court of November 10, 1992).

These decisions follow a long line of authority which has indicated the need to avoid a piecemeal approach to judicial review of administrative action. The board of inquiry in this case has jurisdiction to entertain and determine any of the issues that have been so ably advanced ...

For some time now the Divisional Court has, as I have indicated, taken the position that it should not fragment proceedings before administrative tribunals. Fragmentation causes both delay and distracting interruptions in administrative proceedings. It is preferable, therefore, to allow such matters to run their full course before the tribunal and then consider all legal issues arising from the proceedings at their conclusion.

[108] The Divisional Court in Coady v. Law Society of Upper Canada (2003), O.A.C. 51 (Div. Ct.) further stated:

When litigants before administrative tribunals seek the court's intervention in the midst of the litigation, the court is reluctant to do so except in very extraordinary circumstances. Experience has shown that the best course is to permit the hearings to be completed and then review the entire mater. Many apparent problems disappear in the light of further evidence, sometimes the result makes the application unnecessary. (Coady v. Law Society of Upper Canada, supra at paras. 9-11.)

[109] The Commission has recognized these concerns. The recent Commission decision of Re TSX Inc. (2007), 30 O.S.C.B. 8917, noted that premature attempts to review tribunal decisions are rejected because the interruption would hinder the first instance tribunal from properly and effectively performing its function (at para. 181).

[110] Nonetheless, the Court of Appeal has recognized:

[The general rule] is not absolute and should not be applied rigidly if there is a prospect of real unfairness through, for example, the denial of natural justice. In these circumstances, which will arise infrequently, the courts will intervene before completion of an administrative hearing and prior to the exhaustion of all alternative remedies. (Liquor Control Board of Ontario v. Lifford Wine Agencies Ltd., supra at para. 43.)

[111] For example, this exception may be invoked in circumstances where the information sought by a party is so material to the central issue before the tribunal that non-disclosure taints the very fairness of the hearing itself. In LCBO, supra, the Court stated:

[The] evidence sought to be introduced by [the respondent] through [the investigator] is "material" to the central issue on the stay motion, that is, whether improper interference with the evidence of the LCBO witnesses occurred. In the view of the Divisional Court, the effect of the Board's decision to deny [the respondent] the opportunity to explore this evidence impaired the fairness of the hearing on the stay motion, thereby resulting in a denial of natural justice. (LCBO, supra at para. 37.)

[112] Further, in Waxman v. Ontario (Racing Commission), [2006] O.J. No. 4226 (Ont. Div. Ct.) at para. 11, it was stated:

[...] if the hearing presently scheduled for Monday next were to commence without proper disclosure having been made in a timely way, it would be irretrievably tainted with unfairness from the outset. It does not offend this court's policy of not fragmenting proceedings before administrative tribunals to act to prevent a hearing already tainted from beginning without correcting the unfairness.

[113] As counsel for Berry submits, the relief sought is necessary now to enable Berry and his counsel to prepare for the RS hearing. In People First of Ontario v. Ontario (Niagara Regional Coroner) (1992), 87 D.L.R. (4th) 765 (Ont. C.A.) at 768, the Court of Appeal noted that refusing disclosure before the hearing would be unfair because it would prevent effective participation at the hearing. The Court of Appeal emphasized that while it is generally undesirable to interrupt a proceeding with applications for judicial review, in some cases, correcting an error already made at an earlier time would actually advance the hearing and its resolution.

[114] It is not premature for a reviewing court or tribunal to address an appeal/review of a lower decision when the appeal/review of the lower decision would avoid delay and promote the advancement of the proceeding on a timely basis.

[115] While we are always concerned about fragmenting proceedings, we do not see granting this Application at this time as causing delay. In fact, in these circumstances, we are of the view that the effect is the opposite (i.e. to avoid delay and promote advancement of the proceeding on a timely basis).

[116] RS submits that it is too early to tell whether the disclosure requested is material to the RS Proceeding and this should be left for determination by the RS Panel at the RS Proceeding. According to RS, the Chair of the RS Panel simply concluded that the settlement communications should not be disclosed based on privilege but that their relevance could be assessed in the context of the RS Proceeding. Staff also takes the position that a review of the RS Disclosure Decision would be premature and would fragment the RS Proceeding. At paragraph 19 of their factum, Staff emphasized that:

It is too early to tell whether the evidence is sufficiently important to the fairness of the hearing. The RS Panel is best suited to determine whether natural justice demands disclosure of the Settlement Communications in the context of the hearing. The RS Panel ought to be given the chance to rule on the relevance in the context of the case presented by RS.

[117] For the reasons stated above and on the basis of the Statement of Allegations, Berry's Reply and his counsel's representation that the issue of Scotia's conduct and discussions about its conduct are central to the RS Proceeding, we are satisfied that the Settlement Materials should be disclosed to Berry so that he can decide whether they are relevant to his defence. In our view, it is paramount that the disclosure of the Settlement Materials be dealt with now so that the RS Proceeding can proceed expeditiously. In our view, all of the pertinent information is before us and there would be no benefit or advantage to referring the matter back to the RS Panel for disposition at the commencement of the hearing on the merits. To the contrary, doing so would potentially delay the RS Proceeding.

[118] We are mindful that we should not cause further delay, fragment the RS Proceeding or open the floodgates to applications to override settlement privilege. However, this case relates to a very narrow range of information and documents and is based on unique allegations and positions of the parties.

2. The Importance of the SRO Regime

[119] As stated in Re TSX (2007), 30 O.S.C.B. 8917, "the recognition of SROs by the Commission is designed to utilize the expertise of SROs in achieving the goals of the Act, and this is important to the integrity of the securities regulation scheme as a whole" (at para. 199).

[120] In addition, section 2.1 of the Act states that, "[the] Commission should, subject to an appropriate system of supervision, use the enforcement capability and regulatory expertise of recognized self-regulatory organizations".

[121] The functioning of the SRO regime should not be interfered with lightly. As explained by the Commission in Re TSX:

Clearly, SROs have an essential role to play in the regulation of the capital markets. Consequently, the mandate of SROs and the manner in which they pursue it, should be respected and supported. SROs are often best suited to deal with the issues put before them, and unnecessary appeals and motions to other tribunals should not be permitted to bypass the SRO jurisdiction. (Re TSX, supra at para. 205.)

[122] Notwithstanding the importance of recognizing the jurisdiction of SROs and avoiding undue interference with the SRO process, in some circumstances it may be preferable for the Commission to intervene in order to avoid delay and ensure that fairness is obtained.

[123] The present case is one such example. In our view, it is appropriate for the Commission to address the Application to review the RS Disclosure Decision at this time. The hearing on the merits for the RS Proceeding is scheduled to commence on April 21, 2008, and it is essential that Berry be able to make full answer and defence. As a result, dealing with the RS Disclosure Decision now is not premature and will not fragment the RS Proceeding. Instead, dealing with an issue that affects the fairness of the RS Proceeding in advance of the commencement of the hearing will prevent delay and the need for Berry to bring further disclosure motions before the RS Hearing Panel, which could delay the RS Proceeding as a whole.

IV. Conclusion

[124] Given the nature of the allegations and the positions of the parties, we have concluded that the Settlement Materials are relevant to Berry's defence.

[125] Although settlement privilege generally applies to settlement discussions, the concerns that normally arise around disclosing settlement discussions are absent here, as the settlement agreements between RS and Scotia, and RS and McQuillen, have already been approved and there is little risk of future prejudice to Scotia and McQuillen in the context of the RS Proceeding. The issues in the RS Proceeding are closely linked to the settlement information sought by Berry and non-disclosure could potentially have a significant impact on Berry's ability to prepare his case and make full answer and defence. After balancing the benefits to be gained from the protection of such information from disclosure, with Berry's right to a fair hearing and the opportunity to make full answer and defence, we conclude that the circumstances of this case warrant setting aside the settlement privilege and granting Berry's Application.

[126] Where one individual enters into a settlement agreement and subsequently becomes a witness against another in relation to the same conduct, issues of credibility may arise. We are not saying that disclosure must always be ordered of settlement discussions when a respondent who enters into a settlement agreement subsequently becomes a witness against another. Rather, we believe that this case is an exceptional one that focuses on a very narrow issue under UMIR 10.3(4) where an employee can be held personally liable for contraventions he has caused to his employer. We find that in this unique circumstance, settlement discussions pertaining to the employer are relevant to the key issues facing the employee.

[127] As stated above, we recognize the concern that applications such as this should not be dealt with prematurely and that generally we should not interrupt proceedings of SROs or interfere with the adjudicative function of RS. As noted above, however, the RS Proceeding has not yet commenced and our review of the RS Disclosure Decision will not raise concerns of prematurity or fragmentation. Rather, it is essential that Berry be able to make full answer and defence, and dealing with the RS Disclosure Decision in advance of the commencement of the RS Proceeding will prevent delay of the RS Proceeding as a whole.

[128] Notwithstanding our ruling, it is still open to RS to assert solicitor-client privilege, or litigation privilege, where appropriate, for the communications between each party and their counsel.

[129] Given that third parties are affected, the Disclosure Order restricts Berry to use the Settlement Materials only for the purposes of the RS Proceeding. The Settlement Materials may not be used for any other purposes, for example, in civil proceedings. In order to ensure compliance with the Disclosure Order, the Settlement Materials must be returned to RS or be destroyed by Berry upon the conclusion of the RS Proceeding and any appeals.

[130] Accordingly, for these reasons, we granted the Application and issued the Disclosure Order.

Dated at Toronto on this 21st day of May, 2008.

GMP Investment Management L.P. - s. 26(3)

IN THE MATTER OF

GMP INVESTMENT MANAGEMENT L.P.

OPPORTUNITY TO BE HEARD BY THE DIRECTOR

UNDER SUBSECTION 26(3) OF THE SECURITIES ACT

Overview

By letter dated April 22, 2008, staff advised GMP Investment Management L.P. (GMP) that it was deficient in meeting the minimum capital requirements in Regulation 107(3) under the Securities Act (Ontario) (Act) by $154,054 based on annual audited financial statements as at December 31, 2007. The capital deficiency was rectified as at March 31, 2008.

As a direct consequence of the capital deficiency, staff recommended to the Director that terms and conditions be imposed on GMP's registration for a minimum period of six months. The terms and conditions require the filing of monthly year-to-date unaudited financial statements (including a balance sheet and an income statement prepared in accordance with generally accepted accounting principles) and monthly capital calculations.

Prior to a decision being made by the Director, GMP had the option to oppose staff's recommendation for terms and conditions by requesting an opportunity to be heard under section 26(3) of the Act. GMP had two options -- it could either be heard through written submissions or through a personal appearance before the Director. By letter dated May 6, 2008, Goodmans LLP (on behalf GMP) requested an opportunity to be heard through written submissions.

This is the Director's decision based on staff's and GMP's written submissions.

Submissions

Staff submissions

Staff submits that maintaining adequate minimum capital by registrants is one of the most serious regulatory requirements in the Act. Financial solvency is one of the essential components of a portfolio adviser's continued suitability for registration. A capital deficiency, particularly a large capital deficiency such as in this case, raises potential serious regulatory concerns and needs to be addressed in a serious fashion.

For these reasons, staff uniformly recommends terms and conditions when registrants are capital deficient. It does this notwithstanding the wide variety of reasons provided by registrants for capital deficiencies including inadvertence/oversight, changes in staffing (either at the registrant or its auditors), misclassifications of accounts, or errors. Only in extremely rare circumstances would staff consider not recommending terms and conditions. Staff argues that these circumstances are not present in this case.

Submissions on behalf of GMP

GMP was registered as a portfolio adviser and limited market dealer in December 2007. It was capitalized with a non-interest bearing inter-company loan from an affiliate. The loan had no specified term. The capital deficiency of $154,054 arose as a result of the reclassification of the loan to a current liability in GMP's annual audited financial statements as at December 31, 2007. As at December 31, 2007, the amount of the loan was $157,761. The loan was repaid in February 2008 following a sale by GMP of its securities.

GMP argues that for internal purposes, GMP viewed the loan as long-term financing. It also argues that GMP was in a "pre-operation" period as at December 31, 2007 and that it was not actively engaged in providing advisory services to clients until early April 2008.

Decision and reasons

My decision is to impose the recommended terms and conditions on the registration of GMP for a minimum six month period. These terms and conditions are as follows:

GMP Investment Management L.P. shall file on a monthly basis with the Compliance team of the Ontario Securities Commission, attention Financial Analyst, starting with the month ending May 31, 2008 the following information:

(1) year-to-date unaudited financial statements including a balance sheet and an income statement, both prepared in accordance with generally accepted accounting principles; and

(2) month end calculation of minimum required capital;

no later than three weeks after each month end.

I concur with staff's argument that the rare and unusual circumstances that would result in terms and conditions not being imposed following a capital deficiency (in this case a significant capital deficiency) do not exist in this case. As a relatively new registrant, I would have expected GMP to be particularly careful to ensure that it was meeting the requirements of its registration, particularly the capital requirements.

I was also concerned with GMP's argument that, notwithstanding that GMP (with the concurrence of its auditors) recorded the loan as a current liability in its annual audited financial statements, GMP "viewed the [affiliate] loan as a long-term financing". Despite GMP's view of the loan, it was shown as a current liability in GMP's annual audited financial statements and the result was the large capital deficiency that is the subject of this decision and reasons.

May 26, 2008

"Marrianne Bridge"

Claymore Investments, Inc. - s. 26(3)

IN THE MATTER OF

CLAYMORE INVESTMENTS, INC.

OPPORTUNITY TO BE HEARD BY THE DIRECTOR

UNDER SUBSECTION 26(3) OF THE SECURITIES ACT

Overview

By letter dated April 22, 2008, staff advised Claymore Investments, Inc. that it was deficient in meeting the minimum capital requirements in Regulation 107(3) under the Securities Act (Ontario) (Act) by $206,843 based on annual audited financial statements as at December 31, 2007. The capital deficiency was rectified early in January 2008.

As a direct consequence of the capital deficiency, staff recommended that terms and conditions be imposed on Claymore's registration for a minimum period of six months. The terms and conditions require the filing of monthly year-to-date unaudited financial statements (including a balance sheet and an income statement prepared in accordance with generally accepted accounting principles) and monthly capital calculations.

Prior to a decision being made by the Director, Claymore had the option to oppose staff's recommendation for terms and conditions by requesting an opportunity to be heard under section 26(3) of the Act. Claymore had two options -- it could either be heard through written submissions or through a personal appearance before the Director. By letter dated May 6, 2008, Osler, Hoskin & Harcourt LLP (on behalf of Claymore) requested an opportunity to be heard through written submissions.

This is the Director's decision based on staff's and Claymore's written submissions.

Submissions

Staff submissions

Maintaining adequate minimum capital by registrants is one of the most serious regulatory requirements in the Act. Financial solvency is one of the essential components of an adviser's continued suitability for registration. Capital deficiencies, particularly large capital deficiencies as in this case, raise serious potential regulatory concerns and need to be addressed in a serious fashion.

For these reasons, staff generally recommend terms and conditions on registrants that are capital deficient. Staff does this notwithstanding the variety of reasons registrants provide for capital deficiencies including inadvertence/oversight, change in staffing at the registrant or its auditors, misclassification of accounts, or errors. In staff's opinion, maintaining adequate minimum capital is a serious regulatory obligation for registrants and only in extremely rare circumstances would staff consider not imposing terms and conditions. Staff argues that those circumstances are not present in this case.

Staff further submits that Claymore was well aware of the capital deficiency since the capital deficiency is described in note 9 to its 2007 annual audited financial statements. The note also described a capital deficiency as at December 31, 2006. Terms and conditions were imposed by staff as a result of the December 31, 2006 capital deficiency. Those terms and conditions were removed in December 2007.

Claymore submissions

Claymore argues that the capital deficiency "does not represent a real on-going deficiency in capital". Claymore is wholly owned by Claymore Group, Inc., a financial services and asset management company based in the United States. Claymore Group, Inc. and its affiliates also have two United States registered investment advisers and one United States registered broker dealer.

Claymore Group supports Claymore and provides it with the necessary capital to support its business and development. Since Claymore's registration with the OSC in 2005, Claymore Group has funded it as required and has subordinated its loan position as required.

The December 31, 2007 capital deficiency arose because Claymore received a large invoice for services immediately prior to year end when it was practically impossible to remedy. Claymore Group wired funds to Claymore to rectify the capital deficiency after the close of business on December 31. These funds were received by Claymore on the first business day of January 2008.

Claymore has procedures in place to regularly monitor its capital position. If capital is required, Claymore Group transfers funds to Claymore.

Claymore argues that imposing terms and conditions for the 2007 capital deficiency seems a disproportionate response when measured against the facts described above. Claymore also argues that in circumstances where there is no ongoing capital concern, a monthly filing requirement is burdensome as opposed to some less frequent filing requirement.

Claymore further argues that it has always been concerned about and diligent in its undertaking and discharging its responsibilities as a registrant and is taking these matters very seriously. In the circumstances of this case, the capital deficiency was inadvertent and the timing of the events made it practically impossible to remedy for the December 31, 2007 balance sheet date.

As a result, Claymore requests that the terms and conditions not be imposed on Claymore's registration.

Decision and reasons

My decision is to impose the recommended terms and conditions on the registration of Claymore Investments, Inc. for a minimum six month period. These terms and conditions are as follows:

Claymore Investments, Inc. shall file on a monthly basis with the Compliance team of the Ontario Securities Commission, attention Financial Analyst, starting with the month ending May 31, 2008 the following information:

(1) year-to-date unaudited financial statements including a balance sheet and an income statement, both prepared in accordance with generally accepted accounting principles; and

(2) month end calculation of minimum required capital;

no later than three weeks after each month end.

Since Claymore was capital deficient in both 2007 and 2006 (which represent two of the three years since it was registered), I do not agree with Claymore's arguments about its concern with and diligence in discharging its registrant obligations. Many of our registrants are organized in a similar manner to Claymore and rely on funding from a parent company or other related entity to finance their ongoing operations and fund capital shortages as needed. As well, Claymore was on terms and conditions for six months in 2008 and should have developed strong policies and procedures for ensuring that it met its capital requirements at all times. As a result, I agree with staff that the rare and unusual circumstances that would justify not imposing terms and conditions are not present in this case.

As an aside, normally staff recommends the imposition of terms and conditions for a minimum period of twelve months in these circumstances because it is the second "strike" -- i.e. it is the second consecutive year that Claymore is capital deficient. In my view, a six month period is sufficient given Claymore's immediate response to, and resolution of, the capital deficiency once it was identified.

May 26, 2008

"Marrianne Bridge"

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