Growth Works Capital Ltd. - s. 5.1 of OSC Rule 31-506

July 30, 2003

Decision

Headnote

Section 5.1 of Rule 31-506 SRO Membership -Mutual Fund Dealers - mutual fund dealer exempted, subject toconditions, from the requirements of the Rule that it file anapplication and prescribed fees with the Mutual Fund DealersAssociation of Canada - mutual fund dealer will conduct limitedmutual fund dealer activities only - mutual fund dealer subjectto terms and conditions of registration.

Applicable Ontario Statutory Provisions

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

Applicable Ontario Rule

Rule 31-506 SRO Membership - Mutual Fund Dealers,ss. 2.1, 5.1.

IN THE MATTER OF

THE SECURITIES ACT

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

AND

ONTARIO SECURITIES COMMISSIONRULE 31-506

SRO MEMBERSHIP -- MUTUAL FUNDDEALERS (the "Rule")

AND

IN THE MATTER OF

GROWTH WORKS CAPITAL LTD.

DECISION

(Section 5.1 of the Rule)

UPON the Director having received anapplication (the "Application") from Growth WorksCapital Ltd. ("GWC") for a decision (the "Decision"),pursuant to section 5.1 of the Rule, exempting GWC from therequirements of Section 2.1 of the Rule, which would otherwiserequire GWC be a member of the Mutual Fund Dealers Associationof Canada (the "MFDA");

AND UPON considering the Applicationand the recommendation of staff of the Ontario Securities Commission;

AND UPON the Registrant having representedto the Director that:

1. GWC is a corporation subsisting under thelaws of Canada and is registered in British Columbia as aportfolio manager and is seeking registration as an investmentcounsel/portfolio manager and mutual fund dealer in Ontario;

2. GWC's principal business activity is managingor providing advising services to investment funds whose investmentmandate is primarily to make venture capital investments;

3. GWC's activities as a mutual fund dealerwill represent activities that are incidental to its principalbusiness activities;

4. GWC will not sell securities of the Fundsdirectly to the general public except as contemplated in Schedule"A" and will arrange for an unrelated selling group,comprised of registered dealers which will include investmentdealers who are members of the Investment Dealers Associationof Canada and/or mutual fund dealers who are members of theMFDA who will distribute and sell the securities of the Fundsand arrange for the distribution and sale of the securitiesof the funds through investment dealers, brokers, mutual funddealers, and others.

5. GWC has agreed to the imposition of theterms and conditions on its registration as a mutual funddealer set out in the attached Schedule "A", whichoutlines the activities GWC has agreed to adhere to in connectionwith its application for this decision;

6. the requested relief is currently requiredin Ontario only and no similar application has been filedin any other jurisdiction;

7. any person or company that is not currentlya mutual fund client of GWC on the date of this Decision,will, before they are accepted as a mutual fund client ofGWC, receive prominent written notice from GWC that:

The Registrant is not currently a member,and does not intend to become a member of the Mutual FundDealers Association; consequently, clients of the Registrantwill not have available to them investor protection benefitsthat would otherwise derive from membership of the Registrantin the MFDA, including coverage under any investor protectionplan for clients of members of the MFDA;

8. upon the next general mailing to its mutualfund clients, GWC shall provide to all of its mutual fundclients the written notice referred to in paragraph 7, above;

AND UPON the Director being satisfiedthat to do so would not be prejudicial to the public interest;

IT IS THE DECISION of the Director, pursuantto section 5.1 of the Rule, that, GWC is exempt from the requirementsin section 2.1 of the Rule;

PROVIDED THAT;

The registrant complies with the terms and conditionson its registration under the Act as a mutual fund dealer setout in the attached Schedule "A".

July 30, 2003.

"David M. Gilkes"

Schedule "A"

TERMS AND CONDITIONS OF REGISTRATION

GROWTH WORKS CAPITAL LTD.

AS A MUTUAL FUND DEALER

Definitions

1. For the purposes hereof, unless the contextotherwise requires:

(a) "Act" means the SecuritiesAct, R.S.O. 1990, c. S.5, as amended;

(b) "Adviser" means an adviseras defined in subsection 1(1) of the Act;

(c) "Client Name Trade" means,for the Registrant, a trade to, or on behalf of, a personor company, in securities of a mutual fund, that is managedby the Registrant or an affiliate of the Registrant, where,immediately before the trade, the person or company is shownon the records of the mutual fund or of an other mutualfund managed by the Registrant or an affiliate of the Registrantas the holder of securities of such mutual fund, and thetrade consists of:

(A) a purchase, by the person or company,through the Registrant, of securities of the mutual fund;or

(B) a redemption, by the person or company,through the Registrant, of securities of the mutual fund;

and where, the person or company:

(C) is a client of the Registrant thatwas not solicited by the Registrant; or

(D) was an existing client of the Registranton the Effective Date;

(d) "Commission" means the OntarioSecurities Commission;

(e) "Effective Date" means May23, 2001;

(f) "Employee", for the Registrant,means:

(A) an employee of the Registrant;

(B) an employee of an affiliated entityof the Registrant; or

(C) an individual that is engaged to provide,on a bona fide basis, consulting, technical, managementor other services to the Registrant or to an affiliatedentity of the Registrant, under a written contract betweenthe Registrant or the affiliated entity and the individualor a consultant company or consultant partnership of theindividual, and, in the reasonable opinion of the Registrant,the individual spends or will spend a significant amountof time and attention on the affairs and business of theRegistrant or an affiliated entity of the Registrant;

(g) "Employee", for a ServiceProvider, means an employee of the Service Provider or anaffiliated entity of the Service Provider, provided that,at the relevant time, in the reasonable opinion of the Registrant,the employee spends or will spend, a significant amountof time and attention on the affairs and business of:

(A) the Registrant or an affiliated entityof the Registrant; or

(B) a mutual fund managed by the Registrantor an affiliated entity of the Registrant;

(h) "Employee Rule" means CommissionRule 45-503 Trades To Employees, Executives and Consultants;

(i) "Executive", for the Registrant,means a director, officer or partner of the Registrant orof an affiliated entity of the Registrant;

(j) "Executive", for a ServiceProvider, means a director, officer or partner of the ServiceProvider or of an affiliated entity of the Service Provider;

(k) "Exempt Trade", for the Registrant,means:

(i) a trade in securities of a mutualfund that is made between a person or company and an underwriteracting as purchaser or between or among underwriters;or

(ii) a trade in securities of a mutualfund for which the Registrant would have available toit an exemption from the registration requirements ofclause 25(1)(a) of the Act if the Registrant were nota "market intermediary" as such term is definedin section 204 of the Regulation;

(l) "Fund-on-Fund Trade", forthe Registrant, means a trade that consists of:

(i) a purchase, through the Registrant,of securities of a mutual fund that is made by anothermutual fund;

(ii) a purchase, through the Registrant,of securities of a mutual fund that is made by a counterparty,an affiliated entity of the counterparty or an other personor company, pursuant to an agreement to purchase the securitiesto effect a hedge of a liability relating to a contractfor a specified derivative or swap made between the counterpartyand another mutual fund; or

(iii) a sale, through the Registrant,of securities of a mutual fund that is made by anothermutual fund where the party purchasing the securitiesis:

(A) a mutual fund managed by the Registrantor an affiliated entity of the Registrant; or

(B) a counterparty, affiliated entityor other person or company that acquired the securitiespursuant to an agreement to purchase the securitiesto effect a hedge of a liability relating to a contractfor a specified derivative or swap made between thecounterparty and another mutual fund; and

where, in each case, at least one of thereferenced mutual funds is a mutual fund that is managedby either the Registrant or an affiliated entity of theRegistrant;

(m) "In Furtherance Trade" means,for the Registrant, a trade by the Registrant that consistsof any act, advertisement, or solicitation, directly orindirectly in furtherance of any other trade in securitiesof a mutual fund, where the other trade consists of:

(i) a purchase or sale of securities ofa mutual fund that is managed by the Registrant or anaffiliated entity of the Registrant; or

(ii) a purchase or sale of securitiesof a mutual fund where the Registrant acts as the principaldistributor of the mutual fund;

and where, in each case, the purchase orsale is made by or through another registered dealer ifthe Registrant is not otherwise permitted to make the purchaseor sale pursuant to these terms and conditions;

(n) "Mutual Fund Instrument" meansNational Instrument 81-102 Mutual Funds, as amended;

(o) "Permitted Client", for theRegistrant, means a person or company that is a client ofthe Registrant, and that is, or was at the time the personor company became a client of the Registrant:

(i) an Executive or Employee of the Registrant;

(ii) a Related Party of an Executive orEmployee of the Registrant;

(iii) a Service Provider of the Registrantor an affiliated entity of a Service Provider of the Registrant;

(iv) an Executive or Employee of a ServiceProvider of the Registrant; or

(v) a Related Party of an Executive orEmployee of a Service Provider of the Registrant;

(p) "Permitted Client Trade" means,for the Registrant, a trade to a person who is a PermittedClient or who represents to the Registrant that he, sheor it is a person included in the definition of PermittedClient, in securities of a mutual fund that is managed bythe Registrant or an affiliate of the Registrant, and thetrade consists of a purchase or redemption, by the person,through the Registrant, of securities of the mutual fund;

(q) "Registered Plan" means aregistered pension plan, deferred profit sharing plan, registeredretirement savings plan, registered retirement income fund,registered education savings plan or other deferred incomeplan registered under the Income Tax Act (Canada);

(r) "Registrant" means GrowthWorks Capital Ltd.;

(s) "Regulation" means R.R.O.1990, Reg. 1015, as amended, made under the Act;

(t) "Related Party", for a person,means any other person who is:

(i) the spouse of the person;

(ii) the issue of:

(A) the person,

(B) the spouse of the person, or

(C) the spouse of any person that isthe issue of a person referred to in subparagraphs (A)or (B) above;

(iii) the parent, grandparent or siblingof the person, or the spouse of any of them;

(iv) the issue of any person referredto in paragraph (iii) above; or

(v) a Registered Plan established by,or for the exclusive benefit of, one, some or all of theforegoing;

(vi) a trust where one or more of thetrustees is a person referred to above and the beneficiariesof the trust are restricted to one, some, or all of theforegoing;

(vii) a corporation where all the issuedand outstanding shares of the corporation are owned byone, some, or all of the foregoing;

(u) "securities", for a mutualfund, means shares or units of the mutual fund;

(v) "Seed Capital Trade" meansa trade in securities of a mutual fund made to a personor company referred to in any of subparagraphs 3.1(1)(a)(i)to 3.1(1)(a)(iii) of the Mutual Fund Instrument;

(w) "Service Provider", for theRegistrant, means:

(i) a person or company that providesor has provided professional, consulting, technical, managementor other services to the Registrant or an affiliated entityof the Registrant;

(ii) an Adviser to a mutual fund thatis managed by the Registrant or an affiliated entity ofthe Registrant; or

(iii) a person or company that providesor has provided professional, consulting, technical, managementor other services to a mutual fund that is managed bythe Registrant or an affiliated entity of the Registrant.

2. For the purposes hereof, a person or companyis considered to be an "affiliated entity" of another person or company if the person or company would bean affiliated entity of that other person or company for thepurposes of the Employee Rule.

3. For the purposes hereof:

(a) "issue", "niece","nephew" and "sibling" includes anyperson having such relationship through adoption, whetherlegally or in fact;

(b) "parent" and "grandparent"includes a parent or grandparent through adoption, whetherlegally or in fact;

(c) "registered dealer" meansa person or company that is registered under the Act asa dealer in a category that permits the person or companyto act as dealer for the subject trade; and

(d) "spouse", for an Employeeor Executive, means a person who, at the relevant time,is the spouse of the Employee or Executive.

4. Any terms that are not specifically definedabove shall, unless the context otherwise requires, have themeaning:

(a) specifically ascribed to such term inthe Mutual Fund Instrument; or

(b) if no meaning is specifically ascribedto such term in the Mutual Fund Instrument, the same meaningthe term would have for the purposes of the Act.

Restricted Registration

Permitted Activities

5. The registration of the Registrant as amutual fund dealer under the Act shall be for the purposesonly of trading by the Registrant in securities of a mutualfund where the trade consists of:

(a) a Client Name Trade;

(b) an Exempt Trade;

(c) a Fund-on-Fund Trade;

(d) an In Furtherance Trade;

(e) a Permitted Client Trade; or

(f) a Seed Capital Trade;

provided that, in the case of all trades thatare only referred to in clauses (a) or (e), the trades arelimited and incidental to the principal business of the Registrant.