Maple Group Acquisition Corporation et al. -- ss. 144, 147

July 11, 2012

Decision

Headnote

Order exempting TSX Venture Exchange Inc. from recognition as an exchange, and revoking previous exemption order.

Applicable Legislative Provisions

Securities Act, R.S.O. 1990, c. S.5, as am., ss. 21, 144, 147.

IN THE MATTER OF

THE SECURITIES ACT,

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

(the "Act")

AND

IN THE MATTER OF

MAPLE GROUP ACQUISITION CORPORATION

TMX GROUP INC.

TSX INC.

AND

TSX VENTURE EXCHANGE INC.

EXEMPTION ORDER

(Sections 144 and 147 of the Act)

WHEREAS the Ontario Securities Commission (Commission) issued an order dated August 12, 2005 exempting TSX Venture Exchange Inc. (TSX Venture Exchange) from recognition as an exchange pursuant to section 147 of the Act. (Existing Order);

AND WHEREAS Maple Group Acquisition Corporation (Maple) commenced a transaction (Transaction), consisting of a take-over bid (the Offer) involving the initial take up by Maple of a minimum of 70% of the outstanding shares of TMX Group Inc. (Initial Take Up) and a subsequent arrangement the result of which would be the acquisition by Maple of all of the issued and outstanding voting securities of TMX Group Inc. (TMX Group), the holding company parent which indirectly holds all of the issued and outstanding voting securities of TSX Venture Exchange through its subsidiary TSX;

AND WHEREAS Maple, TMX Group, TSX and TSX Venture Exchange have filed an application with the Commission requesting that the Existing Order be revoked and replaced with an order pursuant to section 147 of the Act exempting TSX Venture Exchange from recognition under section 21 of the Act for the purposes of carrying on business as an exchange in Ontario as a result of the Transaction (the "Application").

AND WHEREAS Maple, TMX Group, TSX and TSX Venture Exchange have represented to the Commission as follows:

1. TSX Venture Exchange was incorporated on October 29, 1999 pursuant to the Business Corporations Act (Alberta) and is a wholly-owned subsidiary of TSX, which is itself a wholly-owned subsidiary of TMX Group.

2. Subsequent to the Transaction, TSX Venture Exchange will continue to be a wholly-owned subsidiary of TSX, and TSX will continue to be a wholly-owned subsidiary of TMX Group.

3. TSX Venture Exchange operates an exchange for junior issuers which is separate from the exchange operated by TSX, and which has a separate TSX Venture Exchange brand identity.

4. TSX Venture Exchange provides Ontario market participants with access to trading in those securities and is considered to be "carrying on business as an exchange in Ontario", and must therefore be either recognized or exempted from recognition as an exchange under section 21 of the Act.

5. TSX Venture Exchange wholly-owns Canadian Unlisted Board Inc. ("CUB"), which operates an internet web-based system for the reporting by dealers of trading in unlisted and unquoted equity securities in Ontario.

6. TSX Venture Exchange is recognized as an exchange by the Alberta Securities Commission (ASC) under the Securities Act (Alberta) and by the British Columbia Securities Commission (BCSC) under the Securities Act (British Columbia), pursuant to orders issued by the ASC and BCSC attached as Schedules A and B, respectively (Recognition Orders), as amended from time to time, and is subject to joint regulatory oversight by both the ASC and the BCSC.

7. TSX Venture Exchange has been advised that the Commission, ASC and BCSC are each party to the Memorandum of Understanding Respecting the Oversight of Exchanges and Quotation and Trade Reporting Systems (MOU), as amended from time to time, respecting oversight of exchanges and quotation and trade reporting systems, which applies to the regulatory oversight of TSX Venture Exchange, and under which the ASC and BCSC are identified as the Lead Regulators that are responsible for the oversight of TSX Venture Exchange.

8. The ASC and BCSC discharges their responsibilities for the oversight of TSX Venture Exchange as an exchange through ongoing reporting requirements and by conducting periodic oversight assessments of TSX Venture Exchange's operations to confirm that TSX Venture Exchange is in compliance with the terms and conditions of the Recognition Orders.

AND WHEREAS based on the Application and the representations that Maple, TMX Group, TSX and TSX Venture Exchange have made to the Commission, the Commission is satisfied that it is not prejudicial to the public interest to revoke the Existing Order and issue a new order exempting TSX Venture Exchange from recognition as an exchange;

AND WHEREAS Maple, TMX Group, TSX and TSX Venture Exchange have agreed to the applicable terms and conditions set out in Schedule C to this order;

IT IS ORDERED by the Commission that, pursuant to section 147 of the Act, TSX Venture Exchange is exempt from recognition under section 21 of the Act provided that Maple, TMX Group, TSX and TSX Venture Exchange comply with the terms and conditions set out in Schedule C to this order, as applicable;

AND IT IS ORDERED that, pursuant to subsection 144(1) of the Act, the Existing Order is revoked;

DATED this 27^th day of July, 2012, and effective upon the completion of the Initial Take Up pursuant to the Offer.

"Mary G. Condon"	"Sarah B. Kavanagh"
Vice-Chair	Commissioner

SCHEDULE A

ALBERTA SECURITIES COMMISSION

RECOGNITION ORDER: EXCHANGE

Citation: TSX Venture Exchange Inc., Re, 2012 ABASC 308

Date: 20120711

TSX Venture Exchange Inc.

Background

1. The Alberta Securities Commission (the Commission) recognized TSX Venture Exchange Inc. (the Exchange) as an exchange under section 62 of the Securities Act (Alberta), R.S.A. 2000, c. S-4 (the Act) by Commission order Re TSX Venture Exchange Inc., 2005 ABASC 686 (the 2005 TSXV Recognition Order).

2. The Exchange is a subsidiary of TMX Group Inc. (TMX Group).

3. TMX Group is the subject of a take-over bid by Maple Group Acquisition Corporation (Maple) which, if successful, is to be followed by an arrangement (together with the take-over bid, the Transaction), the result of which would be the acquisition by Maple of all the issued and outstanding voting securities of TMX Group.

4. The Commission considers it appropriate to revise the terms and conditions of the recognition of the Exchange as an exchange following the Transaction.

5. The Exchange will be subject to the joint regulatory oversight of the Commission and the British Columbia Securities Commission.

Interpretation

6. Unless otherwise defined herein, terms used in this order have the same meaning as in the Act, National Instrument 14-101 Definitions or National Instrument 21-101 Marketplace Operation.

Representations and Undertakings

7. The Exchange will operate in accordance with the terms and conditions set out in the Schedule hereto (the Revised Terms and Conditions).

8. Maple, TMX Group, TSX Inc. (TSX), and the original shareholders of Maple will:

(a) deliver to the Commission on or before completion of the Transaction written undertakings satisfactory to the Executive Director of the Commission (the Undertakings); and

(b) fulfil their respective Undertakings.

Order

9. The Commission, considering that it would not be prejudicial to the public interest to do so, orders:

(a) under section 62 of the Act, the continued recognition of the Exchange provided that and for so long as it adheres to the Revised Terms and Conditions and Maple, TMX Group, TSX and the original shareholders of Maple fulfil their respective Undertakings; and

(b) under section 214(1) of the Act, that the 2005 TSXV Recognition Order is revoked.

For the Commission:

"original signed by"

"original signed by"

Glenda Campbell, QC

Stephen Murison

Vice-Chair

Vice-Chair

Schedule

Recognition Order: Exchange

Definitions

1. For the purposes of this order:

"affiliated entity" has the meaning ascribed to it in section 1.3 of NI 21-101 Marketplace Operation;

"Exchange" means the TSX Venture Exchange Inc.;

"Maple clearing agency" means any clearing agency owned or operated by Maple or Maple's affiliated entities;

"Maple marketplace" means any marketplace owned or operated by Maple or Maple's affiliated entities;

"Maple marketplace participant" means a marketplace participant of any Maple marketplace;

"Maple nomination agreement" means a nomination agreement provided for under section 12(h) of the Amended and Restated Acquisition Governance Agreement of June 10, 2011 of Maple, as amended;

"marketplace" has the meaning ascribed to it in NI 21-101 Marketplace Operation;

"marketplace participant" has the meaning ascribed to it in NI 21-101 Marketplace Operation;

"original Maple shareholder" means each of the Alberta Investment Management Corporation, AIMCo Maple 1 Inc., AIMCo Maple 2 Inc., Caisse de dépôt et placement du Québec, Canada Pension Plan Investment Board, CIBC World Markets Inc., Desjardins Financial Corporation, Dundee Capital Markets Inc., Fonds de solidarité des travailleurs du Québec (F.T.Q.), The Manufacturers Life Insurance Company, National Bank Financial & Co. Inc., National Bank Financial Inc., Ontario Teachers' Pension Plan Board, Scotia Capital Inc., and TD Securities Inc.; and

"significant Maple shareholder" means a person or company that:

(a) beneficially owns or exercises control or direction over more than 5% of the outstanding shares of Maple provided, however, that the ownership of or control or direction over additional Maple shares in connection with the following activities shall not be included for the purposes of determining whether the 5% threshold has been exceeded:

(i) investment activities on behalf of the person or company or its affiliated entity where such investments are made (I) by a bona fide third party investment manager with discretionary authority (subject to such retained discretion in order for the person or company or its affiliated entity to fulfil its fiduciary duties); or (II) by an investment fund or other pooled investment vehicle in which the person or company or such affiliated entity has directly or indirectly invested and which is managed by a third party who has not been provided with confidential, undisclosed information about Maple;

(ii) acting as a custodian for securities in the ordinary course;

(iii) normal course trading (including proprietary client facilitation trading) and wealth management activities (including, for greater certainty, in connection with the management of any mutual funds, pooled funds, trust accounts, estate portfolios and other investor funds and portfolios), including electronic securities trading, conducted for or on behalf of clients of the person or company, provided that any fund manager with discretionary authority carrying out such activities on behalf of such clients, or such clients, have not been provided with confidential, undisclosed information about Maple;

(iv) the acquisition of Maple shares in connection with the adjustment of index-related portfolios or other "basket" related trading;

(v) making a market in securities to facilitate trading in shares of Maple by third party clients or to provide liquidity to the market in the person's or company's capacity as a designated market-maker for shares of Maple, in the person's or company's capacity as designated market-maker for derivatives on Maple shares, or in the person's or company's capacity as market-maker or "designated broker" for exchange traded funds which may have investments in shares of Maple, in each case in the ordinary course (which, for greater certainty, shall include acquisitions or other derivative transactions undertaken in connection with hedging positions of, or in relation to, Maple shares); or

(vi) providing financial services to any other person or company in the ordinary course of business of its and their banking, securities, wealth and insurance businesses, provided that such other person or company has not been provided with confidential, undisclosed information about Maple;

and subject to the conditions that the ownership of or control or direction over Maple shares by a person or company in connection with the activities listed in (i) through (vi) above:

(vii) is not intended by that person or company to facilitate evasion of the 5% threshold set out in clause (a); and

(viii) does not provide that person or company the ability to exercise voting rights over more than 5% of the voting shares of Maple in a manner that is solely in the interests of that person or company as it relates to that person's or company's ownership of or control or direction over the subject shares, except where the ability to exercise voting rights over more than 5% of the voting shares arises as a result of the activities listed in (v) above in which case the person or company must not exercise its voting rights with respect to those excess voting shares;

(b) is an original Maple shareholder that is a party to a Maple nomination agreement, for as long as its Maple nomination agreement is in effect; or

(c) is an original Maple shareholder (A) whose obligations by way of undertakings to the Commission in connection with this order have not terminated and (B) that has a partner, officer, director or employee who is a director on the Maple board other than pursuant to a Maple nomination agreement, for so long as such partner, officer, director or employee remains a director of Maple.

2. For the purposes of this order, an individual is unrelated to an original Maple shareholder if the individual:

(a) is not a partner, officer or employee of an original Maple shareholder or any of its affiliated entities or an associate of that partner, officer or employee;

(b) is not nominated under a Maple nomination agreement;

(c) is not a director of an original Maple shareholder or any of its affiliated entities or an associate of that director; and

(d) does not have, and has not had, any relationship with an original Maple shareholder that could, in the view of the Maple governance committee having regard to all relevant circumstances, be reasonably perceived to interfere with the exercise of the individual's independent judgment as a director of the Exchange.

3. For the purposes of section 2, the Maple governance committee may waive the restriction in section 2(c) if:

(a) the individual being considered does not have, and has not had, any relationship with an original Maple shareholder that could, in the view of the Maple governance committee having regard to all relevant circumstances, be reasonably perceived to interfere with the exercise of his or her independent judgment as a director of the Exchange;

(b) the Exchange publicly discloses the use of the waiver with reasons why the particular candidate was selected;

(c) the Exchange provides advance notice to the Commission, at least 15 business days before the public disclosure in section 3(b) is made; and

(d) the Commission does not object within 15 business days of its receipt of the notice provided under section 3(c).

4. For the purposes of this order, an individual is independent if the individual is "independent" within the meaning of sections 1.4 and 1.5 of National Instrument 52-110 Audit Committees, as amended from time to time, and is not:

(a) a partner, director, officer or employee of a Maple marketplace participant or an associate of a partner, director, officer or employee of a Maple marketplace participant; or

(b) a partner, director, officer or employee of an affiliated entity of a Maple marketplace participant, who is responsible for or is actively or significantly engaged in the day-to-day operations or activities of that Maple marketplace participant.

Mission

5. The Exchange will adopt a mission statement that includes the objective of maintaining and growing a competitive Canadian public venture market.

6. The Exchange will operate a national exchange for venture issuers under a separate brand identity and separately from the national exchange for senior issuers operated by TSX.

7. The Exchange will maintain an office in Alberta that has a significant role in the Exchange's:

(a) development of expertise in the public venture market;

(b) maintenance and growth of a competitive Canadian public venture market;

(c) development of innovations in the public venture market; and

(d) development of policy that enhances the competitive position of the Exchange.

8. From its office in Alberta, the Exchange will also:

(a) provide corporate finance services to, and perform corporate finance functions for, its listed issuers and applicants for listing; and

(b) perform issuer regulation functions.

9. The Exchange will locate in its Alberta office the executive, management, and operations personnel necessary to ensure it meets the requirements of paragraphs 7 and 8.

Public interest

10. The Exchange will operate in the public interest.

Regulation functions of the Exchange

11. The Exchange will set, maintain and enforce rules, policies, and other similar instruments that:

(a) govern listing and corporate finance requirements for its listed issuers;

(b) govern the conduct of and trading by Exchange marketplace participants;

(c) require listed issuers and Exchange marketplace participants to comply with securities legislation and the rules, policies or other instruments of the Exchange;

(d) foster investor protection; and

(e) permit those seeking access to the listing, trading and other services of the Exchange to be granted access without unreasonable discrimination.

12. The Exchange will promptly notify the Commission upon becoming aware that a listed issuer, Exchange marketplace participant, or a director, officer or employee of a listed issuer or Exchange marketplace participant has:

(a) committed a significant violation of securities legislation or of the Exchange's rules, policies or similar instruments; or

(b) engaged in conduct contrary to the public interest.

Reporting and approvals

13. The Exchange will report to the Commission:

(a) at the times;

(b) in the form; and

(c) containing the information;

that the Commission specifies from time to time.

14. The Exchange will not, without prior Commission approval, make any changes to its rules, policies or other similar instruments or introduce any new rules, policies or other similar instruments.

15. The Exchange will not, without prior Commission approval, make any change to its business or operations that:

(a) is outside the ordinary course of its business or operations; or

(b) is inconsistent with its past business or operational practices and presents a risk of adverse consequences to investors, issuers listed on the Exchange or the Canadian public venture market.

Industry advisory committees

16. The Exchange will establish regional industry advisory committees comprised of participants in the Canadian public venture capital market with mandates to provide advice and recommendations to the Exchange board on all policy, operational, and strategic issues that are likely to have a significant impact on the Canadian public venture market. The Exchange will also establish a national advisory committee made up of representatives from the regional advisory committees. The Exchange will allocate financial and other resources to these advisory committees that are sufficient to ensure the committees can meaningfully fulfil their mandates.

17. The national advisory committee will report to the board of the Exchange, at least quarterly, and to the Commission, at least annually. The reports will include the issues the regional and national advisory committees considered and information about what the committees recommended, including whether the national advisory committee rejected or only partially adopted a recommendation of a regional advisory committee.

18. In each case where the Exchange board has not followed or has only partially implemented the recommendation or advice of the national advisory committee, it will provide a report to the Commission as soon as practicable with a written explanation. The report will include a response from the national advisory committee and why it agrees or disagrees with the Exchange board's report.

Corporate governance

19. The Exchange will ensure:

(a) that its board composition provides a reasonable balance between the interests of the different entities using its services and facilities;

(b) fair and meaningful representation of stakeholders on the board and any board or advisory committee, having regard to the fact that it is a national public venture exchange; and

(c) that it has appropriate qualification, remuneration and conflict of interest provisions and limitation of liability and indemnification protections for its directors, officers and employees generally.

20. At least 25% of the directors of the Exchange will, at all times, be persons who have currently relevant expertise in the Canadian public venture market whose expertise comes from experience acquired during a significant period:

(a) as a director or officer of an issuer in the Canadian public venture market;

(b) as a director or officer of an investment dealer, and in that capacity, engaged in underwriting, financing, or trading securities of Canadian public venture issuers;

(c) as a business adviser to issuers in the Canadian public venture market on financing, trading, or mergers and acquisitions;

(d) as a senior officer of an exchange or alternative trading system that lists or trades the securities of a significant number of issuers in the Canadian public venture market; or

(e) making or directing significant investments in the Canadian public venture market.

21. Upon the appointment of a person as a director to fulfill the requirement in section 20, the Exchange will promptly notify the Commission of the appointment, with an explanation about how the person's expertise satisfies the requirements in section 20.

22. The Exchange must require that the quorum for its board meetings include at least two directors appointed to satisfy the venture experience requirement in section 20.

23. The Exchange will:

(a) ensure that at least 50% of its directors are independent, as defined in this order; and

(b) ensure that as long any Maple nomination agreement is in effect, at least 50% of its directors are unrelated to original Maple shareholders.

24. The Exchange must provide the Commission notice of and promptly remedy any instance where the thresholds in sections 20 or 23 are not met.

25. The standards for independence set out in this order will be made available on the Exchange's website.

26. The Exchange will provide the Commission with prior written notice of any changes to its governance structure, including changes to the composition and terms of reference of its board committees and advisory committees, and will obtain Commission approval before implementing any substantive changes.

27. The Commission may approve the appointment of a director who does not meet the criteria set out in subsections 20(a) to (e), to satisfy the requirement for 25% venture representation set out in section 20.

Fitness

28. The Exchange must consider that the past conduct of a director or officer affords reasonable grounds to believe that the director or officer will perform his or her duties with integrity and in a manner that is consistent with the public interest responsibilities of the Exchange.

Conflicts of interest and confidentiality

29. The Exchange must:

(a) establish, maintain, comply with and require compliance with policies and procedures that:

(i) identify and manage any conflicts of interest or potential conflicts of interest arising from the management or operation of the Exchange or the services and products it provides;

(ii) ensure that a person who is a director, officer, employer or partner of a Maple shareholder does not have any involvement with oversight or management of the Exchange, except in the capacity of a director of the Exchange;

(iii) require that confidential information regarding the Exchange's operations or regulatory functions, or regarding an Exchange marketplace participant or listed issuer, which is obtained by a director of the Exchange through their involvement in the management or oversight of the Exchange:

A. be kept separate and confidential from the business or other operations of the director, their employer or their business, except with respect to information regarding Exchange operations where disclosure is necessary to carry out the individual's responsibilities for the management or oversight of the Exchange and the individual exercises due care in disclosing the information; and

B. not be used to provide an advantage to the director, their employer, their business or any of their affiliated entities;

(b) review, at least annually, compliance with the policies and procedures established in accordance with paragraph (a), and document each such review, any deficiencies it identifies and how it remedied those deficiencies; and

(c) make the policies established in accordance with paragraph (a) publicly available on the Exchange's website.

Due process

30. The Exchange will ensure that:

(a) a party to any of its decisions to deny access to its trading and listing facilities is given notice and an opportunity to be heard or make representations; and

(b) it keeps a record, gives reasons and provides for reviews of its decisions.

Fees

31. The Exchange will have a fair and appropriate process for setting fees and incentives.

32. These fees and incentives will:

(a) be allocated on an equitable basis among the Exchange's listed issuers and applicants for listing, Exchange marketplace participants, and other marketplace participants;

(b) not have the effect of creating barriers to access;

(c) be balanced with the Exchange's need to have sufficient revenues to satisfy its responsibilities; and

(d) be fair, reasonable and appropriate.

33. The Exchange will not, without prior approval of the Commission, make any changes to its fees or incentives.

34. The Exchange must not, through any fee schedule, any fee model or any contract, agreement or other arrangement with any Exchange marketplace participant or any other person or company, provide:

(a) any discount, rebate, allowance, price concession or other similar arrangement on any services or products offered by the Exchange that is conditional upon the purchase of any other service or product provided by the Exchange or any affiliated entity;

(b) any discount, rebate, allowance, price concession or other similar arrangement that is accessible only to, whether as designed or by implication, a particular marketplace participant or any other particular person or company; or

(c) any discount, rebate, allowance, price concession or other similar arrangement for any service or product offered by the Exchange that is conditional upon an Exchange marketplace participant:

(i) routing trades to a Maple marketplace as the default or first marketplace to which a marketplace routes; or

(ii) using a Maple marketplace router as its primary router.

35. Except with the prior approval of the Commission, the Exchange must not, through any fee schedule, fee model or contract, agreement or other arrangement with any marketplace participant or any other person or company, provide any discount, rebate, allowance, price concession or other similar arrangement that is accessible only to, whether as designed or by implication, a class of marketplace participants or of any other persons or companies.

36. The Exchange must obtain prior Commission approval before implementing or amending any fees or fee models, including any new or amended incentives, relating to arrangements that provide for equity ownership in Maple for Exchange marketplace participants or their affiliated entities based on trading volumes or values on the Exchange.

37. The Exchange must not require another person or company to purchase or otherwise obtain products or services from any Maple clearing agency as a condition of the Exchange supplying or continuing to supply a product or service.

38. The Exchange must not, without prior Commission approval, require another person or company to purchase or otherwise obtain products or services from the Exchange, any Maple marketplace, or a significant Maple shareholder as a condition of the Exchange supplying or continuing to supply a product or service.

Order Routing

39. The Exchange must not support or encourage, either through fee incentives or otherwise, Exchange marketplace participants to coordinate the routing of any of their orders to a particular Maple marketplace or trading facility owned by Maple or using a particular Maple clearing agency.

Financial viability

40. The Exchange will notify the Commission immediately upon becoming aware that it does not or will not have sufficient financial and other resources to perform its functions in a manner that is consistent with its mission statement, the public interest or the terms and conditions of this order.

Outsourcing

41. The Exchange will obtain prior Commission approval for any outsourcing arrangements related to any of its key services or systems with any third party, including entities affiliated or associated with the Exchange.

Related party transactions

42. Any agreement or transaction entered into between the Exchange and:

(a) Maple, TMX Group, TSX; or

(b) any affiliate or associate of Maple, TMX Group or TSX;

will be on terms and conditions that an independent third party would negotiate, acting at arm's length.

Change in operations or ownership

43. The Exchange must, before ceasing to operate; before suspending, discontinuing or winding up all or a significant portion of its operations; or before disposing of all or substantially all of its assets:

(a) provide the Commission at least six months' prior written notice; and

(b) comply with any requirements the Commission may impose.

44. The Exchange will not cease to be wholly owned by TSX or indirectly wholly owned by TMX Group or Maple without:

(a) providing the Commission at least three months' prior notice; and

(b) complying with any requirements the Commission may impose.

Records and information sharing

45. The Exchange will ensure the Commission can promptly access the information and records, or a copy of the information and records, the Exchange is required to create, maintain, collect or keep under securities legislation or that it otherwise creates, maintains, collects or keeps in the course of its business. The Exchange will ensure the Commission can promptly access information and records obtained by a person or company to whom the Exchange has outsourced a function.

46. The Exchange will provide the Commission all information the Commission requests, in the form and within the times it specifies, and will otherwise co-operate with the Commission and its staff.

47. The Exchange will disclose or share information of a regulatory nature and will otherwise cooperate with other Canadian recognized or exempt exchanges, quotation and trade reporting systems, clearing agencies and self-regulatory organizations, and Canadian regulatory authorities responsible for the supervision or regulation of securities.

Clearing and settlement

48. The Exchange will impose a requirement on Exchange marketplace participants to have appropriate arrangements in place for clearing and settlement.

49. The Exchange will not establish requirements relating to clearing and settlement of trades that would result in:

(a) unfair discrimination of or between Exchange marketplace participants based on the clearing agency used;

(b) an imposition of any burden on competition among clearing agencies or back-office or post-trade service providers that is not reasonably necessary or appropriate; or

(c) an unreasonable prohibition, condition or limitation relating to access by a person or company to services offered by the Exchange or a Maple clearing agency.

Commission approval

50. When seeking the approval of the Commission under these terms and conditions, the Exchange will comply with the procedures established from time to time by the Commission for the regulatory oversight of the Exchange.

SCHEDULE B

2012 BCSECCOM 273

Recognition Order

TSX Venture Exchange Inc.

Section 24(b) of the Securities Act, RSBC 1996, c. 418

Maple Group Acquisition Corporation (Maple) intends to acquire TMX Group Inc. (TMX Group), a subsidiary of which is TSX Venture Exchange Inc. (TSX Venture). Maple applied to the Commission to confirm its recognition of TSX Venture.

The Commission considers it appropriate to revise the terms and conditions of the continued recognition of TSX Venture as an exchange following the acquisition.

TSX Venture will be subject to the joint regulatory oversight of the Commission and the Alberta Securities Commission.

Based on the application and representations of Maple in connection with the application, and on the condition that Maple, TMX Group, TSX and the original Maple shareholders provide undertakings to the Commission, the Commission is satisfied that the continued recognition of TSX Venture following the acquisition will not be prejudicial to the public interest.

The Commission orders the continued recognition of TSX Venture as an exchange under section 24(b) of the Act, effective on the completion of the initial take-up by Maple of a minimum of 70% of the outstanding shares of TMX Group in connection with the acquisition and the delivery of signed undertakings from Maple, TMX Group, TSX and all original Maple shareholders to the Commission. While this order is effective, TSX Venture must meet and continue to meet the revised terms and conditions set out in Schedule A.

Recognition will continue until the Commission, after giving TSX Venture an opportunity to be heard, revokes it.

July 11, 2012

Brenda M. Leong

Chair and CEO

Schedule A

Definitions

1. For the purposes of this order:

"affiliated entity" has the meaning ascribed to it in section 1.3 of NI 21-101 Marketplace Operation;

"Exchange" means the TSX Venture Exchange Inc.;

"Maple clearing agency" means any clearing agency owned or operated by Maple or Maple's affiliated entities;

"Maple marketplace" means any marketplace owned or operated by Maple or Maple's affiliated entities;

"Maple marketplace participant" means a marketplace participant of any Maple marketplace;

"Maple nomination agreement" means a nomination agreement provided for under section 12(h) of the Amended and Restated Acquisition Governance Agreement of June 10, 2011 of Maple, as amended;

"marketplace" has the meaning ascribed to it in NI 21-101 Marketplace Operation;

"marketplace participant" has the meaning ascribed to it in NI 21-101 Marketplace Operation;

"original Maple shareholder" means each of the Alberta Investment Management Corporation, AIMCo Maple 1 Inc., AIMCo Maple 2 Inc., Caisse de dépôt et placement du Québec, Canada Pension Plan Investment Board, CIBC World Markets Inc., Desjardins Financial Corporation, Dundee Capital Markets Inc., Fonds de solidarité des travailleurs du Québec (F.T.Q.), The Manufacturers Life Insurance Company, National Bank Financial & Co. Inc., National Bank Financial Inc., Ontario Teachers' Pension Plan Board, Scotia Capital Inc., and TD Securities Inc.; and

"significant Maple shareholder" means a person that:

(a) beneficially owns or exercises control or direction over more than 5% of the outstanding shares of Maple provided, however, that the ownership of or control or direction over additional Maple shares in connection with the following activities shall not be included for the purposes of determining whether the 5% threshold has been exceeded:

(i) investment activities on behalf of the person or its affiliated entity where such investments are made (I) by a bona fide third party investment manager with discretionary authority (subject to such retained discretion in order for the person or its affiliated entity to fulfil its fiduciary duties); or (II) by an investment fund or other pooled investment vehicle in which the person or such affiliated entity has directly or indirectly invested and which is managed by a third party who has not been provided with confidential, undisclosed information about Maple;

(ii) acting as a custodian for securities in the ordinary course;

(iii) normal course trading (including proprietary client facilitation trading) and wealth management activities (including, for greater certainty, in connection with the management of any mutual funds, pooled funds, trust accounts, estate portfolios and other investor funds and portfolios), including electronic securities trading, conducted for or on behalf of clients of the person, provided that any fund manager with discretionary authority carrying out such activities on behalf of such clients, or such clients, have not been provided with confidential, undisclosed information about Maple;

(iv) the acquisition of Maple shares in connection with the adjustment of index-related portfolios or other "basket" related trading;

(v) making a market in securities to facilitate trading in shares of Maple by third party clients or to provide liquidity to the market in the person's s capacity as a designated market-maker for shares of Maple, in the person's capacity as designated market-maker for derivatives on Maple shares, or in the person's capacity as market-maker or "designated broker" for exchange traded funds which may have investments in shares of Maple, in each case in the ordinary course (which, for greater certainty, shall include acquisitions or other derivative transactions undertaken in connection with hedging positions of, or in relation to, Maple shares); or

(vi) providing financial services to any other person in the ordinary course of business of its and their banking, securities, wealth and insurance businesses, provided that such other person has not been provided with confidential, undisclosed information about Maple;

and subject to the conditions that the ownership of or control or direction over Maple shares by a person in connection with the activities listed in (i) through (vi) above:

(vii) is not intended by that person to facilitate evasion of the 5% threshold set out in clause (a); and

(viii) does not provide that person the ability to exercise voting rights over more than 5% of the voting shares of Maple in a manner that is solely in the interests of that person as it relates to that person's ownership of or control or direction over the subject shares, except where the ability to exercise voting rights over more than 5% of the voting shares arises as a result of the activities listed in (v) above in which case the person must not exercise its voting rights with respect to those excess voting shares;

(b) is an original Maple shareholder that is a party to a Maple nomination agreement, for as long as its Maple nomination agreement is in effect; or

(c) is an original Maple shareholder (A) whose obligations by way of undertakings to the Commission in connection with this order have not terminated and (B) that has a partner, officer, director or employee who is a director on the Maple board other than pursuant to a Maple nomination agreement, for so long as such partner, officer, director or employee remains a director of Maple.

2. For the purposes of this order, an individual is unrelated to an original Maple shareholder if the individual:

(a) is not a partner, officer or employee of an original Maple shareholder or any of its affiliated entities or an associate of that partner, officer or employee;

(b) is not nominated under a Maple nomination agreement;

(c) is not a director of an original Maple shareholder or any of its affiliated entities or an associate of that director; and

(d) does not have, and has not had, any relationship with an original Maple shareholder that could, in the view of the Maple governance committee having regard to all relevant circumstances, be reasonably perceived to interfere with the exercise of the individual's independent judgment as a director of the Exchange.

3. For the purposes of section 2, the Maple governance committee may waive the restriction in section 2(c) if:

(a) the individual being considered does not have, and has not had, any relationship with an original Maple shareholder that could, in the view of the Maple governance committee having regard to all relevant circumstances, be reasonably perceived to interfere with the exercise of his or her independent judgment as a director of the Exchange;

(b) the Exchange publicly discloses the use of the waiver with reasons why the particular candidate was selected;

(c) the Exchange provides advance notice to the Commission, at least 15 business days before the public disclosure in section 3(b) is made; and

(d) the Commission does not object within 15 business days of its receipt of the notice provided under section 3(c).

(a) a partner, director, officer or employee of a Maple marketplace participant or an associate of a partner, director, officer or employee of a Maple marketplace participant; or

(b) a partner, director, officer or employee of an affiliated entity of a Maple marketplace participant, who is responsible for or is actively or significantly engaged in the day-to-day operations or activities of that Maple marketplace participant.

Mission

5. The Exchange will adopt a mission statement that includes the objective of maintaining and growing a competitive Canadian public venture market.

6. The Exchange will operate a national exchange for venture issuers under a separate brand identity and separately from the national exchange for senior issuers operated by TSX.

7. The Exchange will maintain an office in Vancouver that has a significant role in the Exchange's:

(a) development of expertise in the public venture market;

(b) maintenance and growth of a competitive Canadian public venture market;

(c) development of innovations in the public venture market; and

(d) development of policy that enhances the competitive position of the Exchange.

8. From its office in Vancouver, the Exchange will also:

(a) provide corporate finance services to, and perform corporate finance functions for, its listed issuers and applicants for listing; and

(b) perform issuer regulation functions.

9. The Exchange will locate in its Vancouver office the executive, management, and operations personnel necessary to ensure it meets the requirements of paragraphs 7 and 8.

Public interest

10. The Exchange will operate in the public interest.

Regulation functions of the Exchange

11. The Exchange will set, maintain and enforce rules, policies, and other similar instruments that:

(a) govern listing and corporate finance requirements for its listed issuers;

(b) govern the conduct of and trading by Exchange marketplace participants;

(c) require listed issuers and Exchange marketplace participants to comply with securities legislation and the rules, policies or other instruments of the Exchange;

(d) foster investor protection; and

(e) permit those seeking access to the listing, trading and other services of the Exchange to be granted access without unreasonable discrimination.

(a) committed a significant violation of securities legislation or of the Exchange's rules, policies or similar instruments; or

(b) engaged in conduct contrary to the public interest.

Reporting and approvals

13. The Exchange will report to the Commission:

(a) at the times;

(b) in the form; and

(c) containing the information;

that the Commission specifies from time to time.

14. The Exchange will not, without prior Commission approval, make any changes to its rules, policies or other similar instruments or introduce any new rules, policies or other similar instruments.

15. The Exchange will not, without prior Commission approval, make any change to its business or operations that:

(a) is outside the ordinary course of its business or operations; or

(b) is inconsistent with its past business or operational practices and presents a risk of adverse consequences to investors, issuers listed on the Exchange or the Canadian public venture market.

Industry advisory committees

Corporate governance

19. The Exchange will ensure:

(a) that its board composition provides a reasonable balance between the interests of the different entities using its services and facilities;

(b) fair and meaningful representation of stakeholders on the board and any board or advisory committee, having regard to the fact that it is a national public venture exchange; and

(c) that it has appropriate qualification, remuneration and conflict of interest provisions and limitation of liability and indemnification protections for its directors, officers and employees generally.

(a) as a director or officer of an issuer in the Canadian public venture market;

(b) as a director or officer of an investment dealer, and in that capacity, engaged in underwriting, financing, or trading securities of Canadian public venture issuers;

(c) as a business adviser to issuers in the Canadian public venture market on financing, trading, or mergers and acquisitions;

(d) as a senior officer of an exchange or alternative trading system that lists or trades the securities of a significant number of issuers in the Canadian public venture market; or

(e) making or directing significant investments in the Canadian public venture market.

22. The Exchange must require that the quorum for its board meetings include at least two directors appointed to satisfy the venture experience requirement in section 20.

23. The Exchange will:

(a) ensure that at least 50% of its directors are independent, as defined in this order; and

(b) ensure that as long any Maple nomination agreement is in effect, at least 50% of its directors are unrelated to original Maple shareholders.=

24. The Exchange must provide the Commission notice of and promptly remedy any instance where the thresholds in sections 20 or 23 are not met.

25. The standards for independence set out in this order will be made available on the Exchange's website.

Fitness

Conflicts of interest and confidentiality

29. The Exchange must:

(a) establish, maintain, comply with and require compliance with policies and procedures that:

(i) identify and manage any conflicts of interest or potential conflicts of interest arising from the management or operation of the Exchange or the services and products it provides;

(ii) ensure that a person who is a director, officer, employer or partner of a Maple shareholder does not have any involvement with oversight or management of the Exchange, except in the capacity of a director of the Exchange;

(iii) require that confidential information regarding the Exchange's operations or regulatory functions, or regarding an Exchange marketplace participant, or listed issuer, which is obtained by a director of the Exchange through their involvement in the management or oversight of the Exchange:

A. be kept separate and confidential from the business or other operations of the director, their employer or their business, except with respect to information regarding Exchange operations where disclosure is necessary to carry out the individual's responsibilities for the management or oversight of the Exchange and the individual exercises due care in disclosing the information; and

B. not be used to provide an advantage to the director, their employer, their business or any of their affiliated entities;

(b) review, at least annually, compliance with the policies and procedures established in accordance with paragraph (a) and document each such review, any deficiencies it identifies and how it remedied those deficiencies; and

(c) make the policies established in accordance with paragraph (a) publicly available on the Exchange's website.

Due process

30. The Exchange will ensure that:

(a) a party to any of its decisions to deny access to its trading and listing facilities is given notice and an opportunity to be heard or make representations; and

(b) it keeps a record, gives reasons and provides for reviews of its decisions.

Fees

31. The Exchange will have a fair and appropriate process for setting fees and incentives.

32. These fees and incentives will:

(a) be allocated on an equitable basis among the Exchange's listed issuers and applicants for listing, Exchange marketplace participants, and other marketplace participants;

(b) not have the effect of creating barriers to access;

(c) be balanced with the Exchange's need to have sufficient revenues to satisfy its responsibilities; and

(d) be fair, reasonable and appropriate.

33. The Exchange will not, without prior approval of the Commission, make any changes to its fees or incentives.

34. The Exchange must not, through any fee schedule, any fee model or any contract, agreement or other arrangement with any Exchange marketplace participant or any other person, provide:

(a) any discount, rebate, allowance, price concession or other similar arrangement on any services or products offered by the Exchange that is conditional upon the purchase of any other service or product provided by the Exchange or any affiliated entity;

(b) any discount, rebate, allowance, price concession or other similar arrangement that is accessible only to, whether as designed or by implication, a particular marketplace participant or any other particular person; or

(c) any discount, rebate, allowance, price concession or other similar arrangement for any service or product offered by the Exchange that is conditional upon an Exchange marketplace participant:

(i) routing trades to a Maple marketplace as the default or first marketplace to which a marketplace routes; or

(ii) using a Maple marketplace router as its primary router.

35. Except with the prior approval of the Commission, the Exchange must not, through any fee schedule, fee model or contract, agreement or other arrangement with any marketplace participant or any other person, provide any discount, rebate, allowance, price concession or other similar arrangement that is accessible only to, whether as designed or by implication, a class of marketplace participants or of any other persons.

37. The Exchange must not require another person to purchase or otherwise obtain products or services from any Maple clearing agency as a condition of the Exchange supplying or continuing to supply a product or service.

38. The Exchange must not, without prior Commission approval, require another person to purchase or otherwise obtain products or services from the Exchange, any Maple marketplace, or a significant Maple shareholder as a condition of the Exchange supplying or continuing to supply a product or service.

Order Routing

Financial viability

Outsourcing

Related party transactions

42. Any agreement or transaction entered into between the Exchange and:

(a) Maple, TMX Group, TSX; or

(b) any affiliate or associate of Maple, TMX Group or TSX;

will be on terms and conditions that an independent third party would negotiate, acting at arm's length.

Change in operations or ownership

(a) provide the Commission at least six months' prior written notice; and

(b) comply with any requirements the Commission may impose.

44. The Exchange will not cease to be wholly owned by TSX or indirectly wholly owned by TMX Group or Maple without:

(a) providing the Commission at least three months' prior notice; and

(b) complying with any requirements the Commission may impose.

Records and information sharing

46. The Exchange will provide the Commission all information the Commission requests, in the form and within the times it specifies, and will otherwise cooperate with the Commission and its staff.

Clearing and settlement

48. The Exchange will impose a requirement on Exchange marketplace participants to have appropriate arrangements in place for clearing and settlement.

49. The Exchange will not establish requirements relating to clearing and settlement of trades that would result in:

(a) unfair discrimination of or between Exchange marketplace participants based on the clearing agency used;

(b) an imposition of any burden on competition among clearing agencies or back-office or post-trade service providers that is not reasonably necessary or appropriate; or

(c) an unreasonable prohibition, condition or limitation relating to access by a person to services offered by the Exchange or a Maple clearing agency.

Commission approval

SCHEDULE C

TERMS AND CONDITIONS

Meeting Criteria for Exemption from Recognition

1. TSX Venture Exchange will continue to meet the criteria for exemption from recognition attached as Appendix 1 to this schedule.

Regulation and Oversight of Maple, TMX Group, TSX and TSX Venture Exchange

2. TSX Venture Exchange will maintain its recognition as an exchange with the ASC and the BCSC and will continue to be subject to the joint regulatory oversight of the ASC and BCSC.

3. TSX Venture Exchange will comply with the ongoing requirements set out in the Recognition Orders issued by the ASC and BCSC, as amended from time to time.

4. Maple, TMX Group, and TSX will comply with any orders issued by or undertakings provided to the ASC or BCSC in connection with the recognition of TSX Venture Exchange as an exchange, as applicable, and as amended from time to time.

5. Each of Maple, TMX Group and TSX must do everything within its control, which would include cooperating with the Commission as needed, to cause TSX Venture Exchange to carry out its activities as an exchange exempted from recognition under section 21 of the OSA and in compliance with Ontario securities law.

6. TSX Venture Exchange will do everything within its control, which would include cooperating with the Commission as needed, to cause CUB to comply with the agreement attached as Appendix 2 to this schedule, as amended from time to time.

Submission to Jurisdiction and Agent for Service

7. For greater certainty, TSX Venture Exchange submits to the non-exclusive jurisdiction of (i) the courts and administrative tribunals of Ontario and (ii) an administrative proceeding in Ontario, in a proceeding arising out of, related to or concerning or in any other manner connected with the activities of TSX Venture Exchange in Ontario.

8. For greater certainty, TSX Venture Exchange will file with the Commission a valid and binding appointment of an agent for service in Ontario upon whom may be served a notice, pleading, subpoena, summons or other process in any action, investigation or administrative, criminal, quasi-criminal, penal or other proceeding arising out of or relating to or concerning the activities of TSX Venture Exchange in Ontario.

Rules and Filings

9. TSX Venture Exchange will concurrently provide to the Commission copies of all rules, policies and other similar instruments (Rules) that it files for review and approval with the ASC and/or BCSC. Once approved by the ASC and/or BCSC, as applicable, TSX Venture Exchange will provide to the Commission copies of all final Rules within two weeks of approval by the ASC and/or BCSC.

10. TSX Venture Exchange will maintain certain previously adopted amendments to its Corporate Finance Policies in the form attached as Appendix 3 to this schedule, as may be amended from time to time, which require that TSX Venture Exchange issuers that are not otherwise reporting issuers in Ontario and have a "significant connection to Ontario" make application to the Commission and become reporting issuers in Ontario;

11. TSX Venture Exchange continues to maintain previously adopted Corporate Finance Policy 5.9, entitled "Protection of Minority Security Holders in Special Transactions" in the form attached as Appendix 4 to this schedule.

12. TSX Venture Exchange will not make any changes to the amendments to its Corporate Finance Policies referred to in section 10 above, or to the Corporate Finance Policy referred to in section 11 above, without the prior consent of the Commission;

13. TSX Venture Exchange will file with the Commission any information concerning TSX Venture Exchange that is required to be filed with the ASC and/or BCSC pursuant to National Instrument 21-101 Marketplace Operation.

Prompt Notice

14. TSX Venture Exchange will promptly notify staff of the Commission of any of the following:

(a) any material change to the business or operations of TSX Venture Exchange or the information as provided in the Application;

(b) any change or proposed change to the Recognition Orders of the ASC and BCSC, attached as Schedules A and B to this order, respectively; and

(c) any change to the regulatory oversight of TSX Venture Exchange by the ASC and BCSC;

Quarterly Reporting

15. TSX Venture Exchange will maintain the following updated information and submit such information to the Commission on at least a quarterly basis, and at any time promptly upon the request of staff of the Commission:

(a) a list of all participating organizations of TSX Venture Exchange registered in Ontario (Ontario Participating Organizations) against whom disciplinary action has been taken in the last quarter by TSX Venture Exchange with respect to activities on TSX Venture Exchange; and

(b) a list of all investigations by TSX Venture Exchange relating to Ontario Participating Organizations.

Information Sharing

16. Upon request by the Commission, directly or through the ASC and BCSC as the case may be, TSX Venture Exchange must, and must cause its affiliated entities to, promptly provide the Commission any and all data, information and analyses in the custody or control of TSX Venture Exchange or any of its affiliated entities, without limitations, redactions, restrictions or conditions, including without limiting the generality of the foregoing:

(a) data, information and analyses relating to all of its or their businesses;

(b) data information and analyses of third parties in its or their custody or control;

(c) any information in the possession of TSX Venture Exchange, or over which TSX Venture Exchange has control, relating to members, shareholders and the market operations of TSX Venture Exchange, including, but not limited to, shareholder and participating organization lists, products, trading information and disciplinary decisions; and

(d) any information required to be provided by TSX Venture Exchange to the Investment Industry Regulatory Organization of Canada, including any and all order and trade information, as required by the Commission.

17. TSX Venture Exchange will share information and otherwise cooperate with other recognized or exempt exchanges, recognized self-regulatory organizations, other recognized or exempt clearing agencies, investor protection funds, and other appropriate regulatory bodies.

18. The disclosure or sharing of information by or pertaining to an affiliated entity of TSX Venture Exchange in accordance with sections 16 and 17 above will be subject to any provisions contained in any order issued by the Commission recognizing the affiliated entity as an exchange under section 21 of the Act or as a clearing agency under section 21.2 of the Act that would otherwise have limited the information required to be provided by the affiliated entity if the request had instead been made by the Commission to the affiliated entity pursuant to such order.

APPENDIX 1

CRITERIA FOR EXEMPTION FROM RECOGNITION OF

AN EQUITY EXCHANGE RECOGNIZED IN ANOTHER JURISDICTION

OF THE CANADIAN SECURITIES ADMINISTRATORS

PART 1 REGULATION OF THE EXCHANGE

Regulation of the Exchange

The exchange is recognized or authorized by another securities commission or similar regulatory authority in Canada and, where applicable, is in compliance with National Instrument 21-101 -- Marketplace Operation (NI 21-101), and National Instrument 23-101 -- Trading Rules, each as amended from time to time, which include requirements relating to:

(a) access;

(b) marketplace operations;

(c) exchange rules, policies and other similar instruments;

(d) order and trade transparency;

(e) transparency of marketplace operations;

(f) record keeping;

(g) marketplace systems and business continuity planning;

(h) confidentiality of information;

(i) outsourcing;

(j) clearing and settlement;

(k) fair and orderly markets;

(l) the management of conflicts of interest; and

(m) filing of financial statements.

PART 2 GOVERNANCE

2.1 Governance

The governance structure and governance arrangements of the exchange ensure:

(a) effective oversight of the exchange,

(b) that business and regulatory decisions are in keeping with the its public interest mandate,

(c) fair, meaningful and diverse representation on the board of directors (Board) and any committees of the Board, including:

(i) appropriate representation of independent directors, and

(ii) a proper balance among the interests of the different persons or companies using the services and facilities of the exchange,

(d) the exchange has policies and procedures to appropriately identify and manage conflicts of interest, and

(e) there are appropriate qualifications, remuneration, limitation of liability and indemnity provisions for directors, officers and employees of the exchange.

2.2 Fitness

The exchange has policies and procedures under which it will take reasonable steps, and has taken such reasonable steps, to ensure that each director and officer is a fit and proper person.

PART 3 ACCESS

3.1 Fair Access

(a) The exchange has established appropriate written standards for access to its services including requirements to ensure participants are appropriately registered under Ontario securities laws, or exempted from these requirements.

(b) The access standards and the process for obtaining, limiting and denying access are fair, transparent and applied reasonably.

PART 4 REGULATION OF PARTICIPANTS AND ISSUERS ON THE EXCHANGE

4.1 Regulation

The exchange has the authority, resources, capabilities, systems and processes to allow it to perform its regulation functions, whether directly or indirectly through a regulation services provider, including setting requirements governing the conduct of its participants and issuers, monitoring their conduct, and appropriately disciplining them for violations of exchange requirements.

PART 5 RULES AND RULEMAKING

5.1 Rules and Rulemaking

(a) The exchange has rules, policies, and other similar instruments (Rules) that are designed to appropriately govern and regulate the operations and activities of participants and issuers.

(b) In addition to meeting the requirements of NI 21-101 relating to market operations and exchange rules, policies and other similar instruments as referred to in paragraphs 1.1(b) and (c) of this appendix, respectively, the Rules are also are designed to

(i) ensure a fair and orderly market; and

(ii) provide a framework for disciplinary and enforcement actions.

PART 6 DUE PROCESS

6.1 Due Process

For any decision made by the exchange that affects a participant or issuer, or an applicant to be a participant or issuer, including a decision in relation to access, listing, exemptions, or discipline, the exchange ensures that:

(a) parties are given an opportunity to be heard or make representations, and

(b) it keeps a record of, gives reasons for and provides for appeals or reviews of its decisions.

PART 7 CLEARING AND SETTLEMENT

7.1 Clearing Arrangements

The exchange has appropriate arrangements for the clearing and settlement of trades.

PART 8 SYSTEMS AND TECHNOLOGY

8.1 Information Technology Risk Management Procedures

The exchange has appropriate risk management procedures in place including those that handle trading errors, trading halts and circuit breakers.

PART 9 FINANCIAL VIABILITY

9.1 Financial Viability

The exchange has sufficient financial resources for the proper performance of its functions and to meet its responsibilities.

PART 10 FEES

10.1 Fees

(a) All fees imposed by the exchange are reasonable and equitably allocated and are consistent with the requirements in NI 21-101, including those listed in paragraphs 1.1(a) and (e) of this appendix;

(b) The process for setting fees is fair and appropriate, and the fee model is transparent.

PART 11 INFORMATION SHARING AND REGULATORY COOPERATION

11.1 Information Sharing and Regulatory Cooperation

The exchange has mechanisms in place to enable it to share information and otherwise co-operate with the Commission, recognized self-regulatory organizations, other recognized or exempt exchanges, clearing agencies, investor protection funds, and other appropriate regulatory bodies.

APPENDIX 2

OTC AGREEMENT

(the "Agreement")

THIS AGREEMENT made as of the 6th day of October, 2000,

AMONG:

CANADIAN UNLISTED BOARD INC.

("CUB")

AND

CANADIAN VENTURE EXCHANGE INC.

("CDNX")

AND

THE ONTARIO SECURITIES COMMISSION

("OSC")

WHEREAS:

A. By an agreement made as of February 28, 1991 among The Toronto Stock Exchange (the "TSE"), the OSC and the Canadian Dealing Network Inc. ("CDN"), CDN (a wholly-owned subsidiary of the TSE) took on assignment from the OSC and has been operating a trade reporting system (the "CDN Reporting System") and a quotation system (the "CDN Quotation System") (collectively, the "CDN System") to provide visibility for over-the-counter ("OTC") trading of equity securities in the Province of Ontario;

B. By an agreement made as of September 29, 2000 among CDNX, the TSE and CDN (the "CDN Agreement"), the TSE and CDN have agreed to cease operating the CDN System;

C. The OSC wishes to ensure that a system continues to exist in the Province of Ontario through which OSC registered dealers can continue their mandatory reporting of all OTC trading in unlisted and unquoted equity securities in the Province of Ontario not specifically excluded from the reporting requirements of the Securities Act, R.S.O. 1990, Chapter S.5 and the regulations thereto (collectively, the "Act");

D. Subject to the terms and conditions of this Agreement, CUB, a wholly owned subsidiary of CDNX, is prepared to operate an internet web-based reporting system for the reporting by registered dealers of OTC trading in unlisted and unquoted equity securities in the Province of Ontario (the "OTC System") and to provide certain services to the OSC with respect thereto; and

E. Subject to the terms and conditions of this Agreement, CDNX has agreed to ensure that CUB fulfils its obligations hereunder and has adequate resources (including those made available to it by CDNX) to operate the OTC System and to provide to the OSC those services called for by this Agreement;

NOW THEREFORE in consideration of the premises and the mutual covenants, terms and conditions herein contained, the parties hereto do hereby mutually covenant and agree as follows:

1.THE OTC SYSTEM

1.1 The OTC System to be operated by CUB pursuant to this Agreement shall possess the characteristics and functionality described in Schedule "A" which is attached hereto and forms a part of this Agreement; provided, however, and the parties further agree that for greater certainty the OTC System will not provide for visible trade reporting.

1.2 The OTC System shall commence operation as at 5:00 p.m. EST on October 6, 2000 such that mandatory reporting by OSC registered dealers of all OTC trading in unlisted and unquoted equity securities in the Province of Ontario not specifically excluded from the reporting requirements of the Act (hereinafter referred to as "Ontario OTC trading") via the OTC System will commence on October 10, 2000.

1.3 All right, title and interest in and to the OTC System shall be owned solely by CUB, its successors and permitted assigns. For greater certainty, the right, title and interest in and to all registered and unregistered trademarks, trade names, service marks, copyrights, designs, inventions, patents, patent applications, patent rights, licenses, franchises, processes, technology, trade secrets and other industrial property pertaining to the OTC System developed by CUB (or on behalf of CUB by CDNX) or to any developments or enhancements of the OTC System implemented by CUB shall be owned solely by CUB, its successors and permitted assigns and, subject as herein otherwise provided, the OSC, OSC registered dealers who report trades on the OTC System ("Users") and any other parties shall acquire no rights in or license to use the OTC System except as may be necessary for the due implementation of this Agreement.

2.ADMINISTRATION/OPERATION OF THE OTC SYSTEM

2.1 Subject to the terms and conditions of this Agreement, CUB shall administer and operate the OTC System by providing:

(i) trade reporting services in respect of Ontario OTC trading by Users;

(ii) surveillance services as referred to in Part 4 of this Agreement in respect of Ontario OTC trading by Users; and

(iii) such services as may be required to record and account for the fees referred to in subsection 2.3 below and charged by CUB for use of the OTC System.

2.2 CUB will provide such staff as are necessary to operate the OTC System with the functionality described in Schedule "A".

2.3 CUB may establish and from time to time amend a schedule of fees that it will be entitled to charge for use of the OTC System. Such fees shall be established at a level which, in the aggregate, will permit CUB to be reimbursed for all costs associated with the development and ongoing operation of the OTC System, including all operating, capital and related costs. All fees charged by CUB will be consistent with CUB's status as a not-for- profit entity and, though not subject to prior approval by the OSC, may be reviewed by the OSC.

2.4 All fees and other revenue derived from the operation of the OTC System will be retained by CUB.

2.5 CUB will ensure that each User shall, as a condition of using the OTC System, enter into an agreement with CUB (the "User Agreement") in the form and upon substantially the terms attached hereto as Schedule "B".

3.REGULATION OF THE OTC SYSTEM

3.1 In the event that the OTC System is implemented prior to the implementation of the OSC's rules governing alternative trading systems (the "ATS Rules") and unless otherwise agreed, the parties agree that the OTC System will be regulated in two phases as follows:

(i) for the period commencing on the date of implementation of the OTC System and ending on the date of implementation in Ontario of a local rule relating to Ontario OTC trading which will be implemented concurrently with the ATS Rules or such other rules as the OSC may apply to Ontario OTC trading (the "Ontario Local Rule"), the OTC System will be regulated in accordance with the OTC Terms and Conditions which are attached as Schedule "A" to the User Agreement (the "User Obligations"); and

(ii) commencing on the date of implementation of the Ontario Local Rule and ending on the date of the termination of this Agreement, the OTC System will be regulated in accordance with the Ontario Local Rule.

3.2 In the event that the OTC System is implemented after implementation of the Ontario Local Rule, the OTC System will be regulated in accordance with the Ontario Local Rule.

3.3 It is recognized and agreed that CUB shall not make any rules or regulations regarding Ontario OTC trading and that until such time as the Ontario Local Rule is implemented the OTC System will be operated and governed in accordance with the User Obligations.

4.SURVEILLANCE SERVICES IN RESPECT OF THE OTC SYSTEM

4.1 CUB will provide surveillance services as described in confidential Schedule "C" which is attached hereto and forms a part of this Agreement in respect of Ontario OTC trading that is reported to the OTC System; provided, however, and it is further understood and agreed, that the responsibility for enforcement regulatory activity pertaining to Ontario OTC trading will rest exclusively with the OSC and CUB will not provide enforcement services in respect of the market participants using the OTC System.

4.2 The surveillance services described in confidential Schedule "C" and provided by CUB in respect of Ontario OTC trading that is reported to the OTC System will be comprised generally of and limited to the following:

(i) exception monitoring for Ontario OTC trading activity in violation of the terms of any User Agreement, applicable trading rules or applicable securities laws; and

(ii) press release monitoring for issuer disclosure in respect of Ontario OTC trading in violation of applicable securities laws.

4.3 All matters requiring enforcement action will be referred to the applicable securities regulatory body which it is anticipated will be the OSC in most cases involving the OTC System.

4.4 CUB will impose no trading halts in respect of any Ontario OTC trading reported to the OTC System.

4.5 CUB will provide to the OSC on request all such Ontario OTC trading and surveillance data respectively reported to the OTC System and collected by CUB as the OSC may require for its investigative and enforcement purposes.

5.MAINTENANCE OF TRADING DATA

5.1 Ontario OTC reporting and surveillance data respectively reported to the OTC System and collected by CUB will be maintained by CUB for its surveillance and the OSC's enforcement purposes only, and will not be published. For greater certainty, CUB shall ensure that such data is retained for a period of at least seven (7) years and accessible to OSC staff for investigative and enforcement purposes.

5.2 CUB recognizes its obligation to provide the OSC access (via the OTC System) to data collected by CUB in respect of Ontario OTC trading reported to the OTC System so as to assist the OSC in carrying out its regulatory responsibilities.

6.ACKNOWLEDGEMENTS OF THE OSC

6.1 Effective as at 5:00 p.m. EST on October 6, 2000, the OSC by separate instrument has appointed CUB as the OSC's agent as contemplated in Part VI of the Regulation, for the purpose of operating the OTC System.

6.2 In order to assist CUB in its operation of the OTC System, the OSC may obtain and provide to CUB such information as the OSC deems appropriate, including information:

(i) on disciplinary or other action the OSC determines to take against a User which, in the OSC's view, will have a material impact on the User's participation in the OTC System; and

(ii) relating to issuers of OTC Securities (being the same as "COATS Securities" as defined in section 152 of Part VI of the Regulation), OSC registered dealers or any other Persons (as such latter term is defined in the Act) that leads the OSC to believe that there has been or will be a breach of the terms and conditions of Part VI of the Regulation.

7.COVENANTS OF CDNX

7.1 CDNX agrees to ensure that CUB fulfils its obligations under this Agreement and has adequate resources (including those made available to it by CDNX) to operate the OTC System and to provide to the OSC those services called for by this Agreement.

8.CUB TO LIMIT THE LIABILITY OF CDNX

8.1 CUB agrees that it will, in connection with the performance by it of its obligations under this Agreement, take reasonable precautions to limit the liability, if any, of CDNX to any third party in connection with the operation of the OTC System, such precautions to include, where possible, the use of disclaimers in connection with the supply of information and the insertion of appropriate limiting conditions in contracts entered into by CUB.

9.TERM AND TERMINATION

9.1 This Agreement shall come into force and effect as at 5:00 p.m. EST on October 6, 2000 (the "Effective Date") such that the reporting of Ontario OTC trading via the OTC System will commence on October 10, 2000 and (provided that it is not terminated due to termination of the CDN Agreement pursuant to the terms thereof) shall survive from such date until the earlier of the day upon which it is terminated pursuant to subsection 9.2 hereof or the day upon which this Agreement is replaced by a new agreement entered into amongst the parties by reason of implementation by the OSC of the Ontario Local Rule; provided, however, that if this Agreement is so replaced the replacement agreement will not itself be able to be terminated before the earliest date that this Agreement can be terminated pursuant to subsection 9.2 hereof.

9.2 At any time at least three (3) years after the Effective Date, any of the parties may give one (1) year's written notice to the others of its decision to terminate its obligations hereunder, and this Agreement shall thereafter terminate on the expiry of such notice.

10.NON PERFORMANCE

10.1 If a party to this Agreement believes that another party is not performing satisfactorily its obligations under this Agreement, it may give written notice to the other party stating that belief accompanied by particulars in reasonable detail of the alleged failure to perform. If the party receiving such notice has not satisfied the notifying party within one (1) month of the delivery of the notice either that its performance is satisfactory or that it has taken or will take acceptable steps to rectify its performance, the notifying party may by written notice to the other parties terminate this Agreement on a date not less than three (3) months following delivery of such notice.

11.NOTICE

Any notice or other communication required or permitted to be given hereunder shall be sufficiently given if delivered in person or if sent by facsimile transmission:

11.1 in the case of CUB, both for itself and on behalf of CDNX, at the following address:

Canadian Unlisted Board Inc.

c/o Canadian Venture Exchange Inc.

10th Floor, 300 Fifth Avenue S.W.

Calgary, Alberta T2P 3C4

Attention: CDNX Vice President, Regulatory Affairs & Corporate Secretary

Facsimile No: (403) 237-0450

11.2 in the case of the OSC, at the following address:

The Ontario Securities Commission

Suite 1800, P.O. Box 55

20 Queen Street West

Toronto, Ontario M5H 3S8

Attention: Manager, Market Regulation

Facsimile No: (416) 593-8240

or at such other address as the party to which such notice or other communication is to be given has last notified to the other parties in the manner provided in this section, and if so given the same shall be deemed to have been received on the date of such delivery or sending.

12. FURTHER ASSURANCES, AMENDMENTS AND WAIVERS

12.1 Each party hereto covenants and agrees that it shall from time to time and at all times execute and deliver all such further documents and assurances as shall be reasonably required in order to fully perform and carry out the intent of this Agreement. This Agreement can only be amended with the consent in writing of both parties and no party shall be deemed to have waived any provision of this Agreement unless such waiver is in writing.

13. APPLICABLE LAW

13.1 This Agreement shall be governed by and construed in accordance with the laws of the Province of Ontario and the laws of Canada applicable therein.

14. COUNTERPARTS AND FACSIMILE SIGNATURE

14.1 This Agreement may be executed in separate counterparts and all such counterparts shall together constitute one and the same instrument.

14.2 The parties agree that executed copies of this Agreement may be delivered by fax or similar device and that the signatures appearing on the copies so delivered will be as binding as if copies bearing original signatures had been delivered; each party undertakes to deliver to the other party a copy of this Agreement bearing original signatures, forthwith upon demand.

15. FORCE MAJEURE

15.1 No party shall be responsible for delays or failures in performance resulting from acts beyond the control of such party. Such acts shall include, but not be limited to, acts of God, the operation of any law, regulation or order of government or other similar authority, any labour disparity or dispute, strike, lockout, riot, explosion, war, invasion, epidemic, fire, earthquake or other natural disaster, power failure or system failure including network failures.

16. SUCCESSORS AND ASSIGNS

16.1 Neither CUB, CDNX nor the OSC shall assign this Agreement or any of their respective rights or obligations hereunder without the prior written consent of the others. This Agreement shall enure to the benefit of and be binding upon the respective successors and permitted assigns of the parties hereto.

IN WITNESS WHEREOF, the parties have hereunto duly executed this Agreement as of the day and year first above written.

CANADIAN UNLISTED BOARD INC.

Per:__________________

Authorized Signatory

Per:__________________

Authorized Signatory

CANADIAN VENTURE EXCHANGE INC.

Per:__________________

Authorized Signatory

Per:__________________

Authorized Signatory

THE ONTARIO SECURITIES COMMISSION

Per:__________________

Authorized Signatory

Per:__________________

Authorized Signatory

This is Schedule "A" to that certain Agreement made as of the 6th day of October, 2000, among Canadian Unlisted Board Inc., Canadian Venture Exchange Inc. and The Ontario Securities Commission

OTC SYSTEM CHARACTERISTICS AND FUNCTIONALITY

1.1 Characteristics- Included Characteristics

The OTC System will be a CUB-developed internet web-based system solution for the reporting of Ontario OTC trading the general characteristics of which will be a system:

1. providing a secure, reliable environment to enable registered dealers to report trades in securities according to the Securities Act (Ontario).

2. providing a basic reporting, surveillance, and administrative functionality with unexplained trading and disclosure anomalies being forwarded to the OSC for enforcement and further investigation.

3. providing a separation of Ontario OTC trading from CDNX and the CDNX brand.

4. separable from CDNX technology operations and deployable to other technical environments should the OSC choose to change service providers.

5. extendable to other provincial jurisdictions in support of possible national trade reporting.

6. possessing a separate logical billing system within CDNX's Oracle Financials to generate invoices and statements for CUB that are distinct from those of CDNX.

7. possessing a backup OTC System application server (existing disaster recovery hardware at CDNX Business Continuity Planning ("BCP") recovery sites having sufficient capacity to accommodate the OTC System application).

1.2 Functionality

1.2.1 Included Functionality

The OTC System will possess the following functionality:

1.2.1.1. Registered Dealer Functionality:

1. Registered Dealer administrative functions

1.1. Provide the ability for the registered dealer (who may or may not be TSE or CDNX members) to logon, logoff and change their passwords

2. Report a trade

2.1. Report a trade done today (typically reported by the selling registered dealer)

2.1.1. Data includes: symbol, volume, price, contra-broker, time-stamp, identification of which side reported the trade.

2.2. Limit or restrict the registered dealer from reporting a trade that was executed prior to the current day. 'As of' reporting to be handled by the administrative or market regulation function of CUB (see Administrative Functionality below).

3. Report a trade cancellation

4. Inquire on trading activity for an issue

4.1. The reporting functions proposed with respect to Ontario OTC trading are purposely limited.

4.2. Data attributes to be displayed are:

4.2.1. For today: high price, low price, last price, net change, volume, value, # trades and list of all trades

4.2.2. For historical periods: high price, low price, last price, net change, volume, value, # trades

5. View Administrative Notice Board

5.1. Contains textual information posted by CUB administrative and market regulation staff

6. Online Help

6.1. Display of "How To" information explaining the operation of the OTC System

6.2. Inquiries to list:

6.2.1. Securities on the system that have reported activity (stock list) that would include the issue name, symbol, and Cusip number (if applicable)

6.2.2. Yesterday's and today's add's, delete's and changes to the stock list

6.2.3. A directory of registered dealer users Ids and names

1.2.1.2. Administrative Functionality:

Administrative functionality will be used by CUB staff to administer the OTC System.

1. UserID administration

1.1. Setup new UserID

1.2. Maintain UserID (change, delete, force password changes)

2. Security Master maintenance

2.1. Add, change, delete issues that can be reported. This functionality can be done in real-time.

2.2. Update Trading status to restrict the reporting of trades

3. Report trade (on behalf of a registered dealer)

3.1. Similar to the registered dealer function to report a trade.

3.2. This functionality can also serve as a short-term backup service should operational problems arise with accessing the system.

4. Report a trade done up to 364 days ago ("as of")

4.1. 'As of' reporting is done by CUB staff on behalf of the registered dealer. The registered dealer would send (via fax) to CUB the particulars of the delayed trade report.

4.2. Historical information to be updated to reflect the reported trade.

5. Report trade cancellation (on behalf of a registered dealer)

5.1. Similar to the registered dealer function to report a trade cancellation.

5.2. This functionality can also serve as a short-term backup service should operational problems arise with accessing the system.

5.3. Historical information would be updated to reflect the cancelled trade.

6. Post and clear notices and other textual information to Administrative Notice Board

6.1. The transaction is logged to an audit trail file

7. Online Help maintenance

7.1. Update static "How To" information

1.2.1.3. Regulatory Functionality:

Regulatory functionality will be that employed by CUB staff to provide regulatory oversight or surveillance of Ontario OTC trading (it being understood that all enforcement action arising from CUB's surveillance activities in respect of Ontario OTC trading that is reported to the OTC System will be undertaken by the OSC). Due to the nature of Ontario OTC trading, all such regulatory functionality will be of a post-trade nature.

1. Alerts of reported trades that cause exceptions to price change and volume tolerance parameters.

2. OSC access to the OTC System to perform specified inquiry functions:

2.1. Today and historical trading inquiries (see Registered Dealer Functionality above)

2.2. Generate reports on trading activity per Registered Dealer firm, per security, and for all securities per specified (flexible) date range.

2.3. Access to Online Help inquiries (see Registered Dealer Functionality above)

3. Ad hoc reports for investigations forwarded to the OSC.

4. Data extracts for investigations forwarded to the OSC.

1.2.1.4. Operational Functionality:

Operational functionality will be global in nature and apply to the entire OTC System.

- Implement a standalone OTC System application server (NT operating system), separate from CDNX systems.

- Establish recovery procedures to transfer the application to an existing CDNX NT server on an interim basis in the event of a CUB/OTC System server failure.

- Store trade summaries for surveillance purposes (history)

- Store detail trade records for investigative purposes (history)

- Conduct daily backup of files and databases

- Include OTC System in CDNX BCP and provide 48 hour recovery time for the CUB OTC System at the CDNX BCP recovery site(s)

- Generate billing reports

- Generate monthly reports of trading activity for invoice preparation.

1.3 Excluded Functionality

The OTC System will NOT possess the following functionality:

• Capability regarding investigation and enforcement of trading and disclosure anomalies generated by the system.

• Capability to prioritize price/volume exceptions.

• Capability to generate real time data feeds or press reports.

• Capability to transfer historical trade information from the TSE/CATS system.

This is Schedule "B" to that certain Agreement made as of the 6th day of October, 2000, among Canadian Unlisted Board Inc., Canadian Venture Exchange Inc. and The Ontario Securities Commission

CANADIAN UNLISTED BOARD INC. USER AGREEMENT (THE "AGREEMENT")

WHEREAS the Canadian Venture Exchange Inc. ("CDNX" or the "Exchange") has entered into an agreement with the Toronto Stock Exchange Inc. ("TSE") and the Canadian Dealing Network Inc. ("CDN") whereby:

(i) as at 5:00 p.m. EST on September 29, 2000, the TSE and CDN shall cease operating the CDN Quotation System such that eligible CDN quoted issuers that have filed complete applications as determined by CDNX shall commence trading on CDNX Tier 3 as at the start of business on October 2, 2000; and

(ii) as at 5:00 p.m. EST on October 6, 2000, the TSE and CDN shall cease operating the CDN Reporting System such that as of the start of business on October 10, 2000, OSC registered dealers can continue their mandatory reporting of all OTC trading in unlisted and unquoted equity securities in the province of Ontario not specifically excluded from the reporting requirements of the Act and the regulations thereto via the OTC System;

WHEREAS the Canadian Unlisted Board Inc., a wholly owned subsidiary of CDNX ("CUB"), CDNX and the Ontario Securities Commission (the "Commission") have entered into an agreement pursuant to which CUB will operate an internet web-based reporting system for the reporting by dealers of trading in unlisted and unquoted equity securities in Ontario (the "OTC System") for the purposes of Part VI of Regulation 1015 ("Part VI");

WHEREAS CUB has been appointed as an agent of the Commission for the purposes of developing computer software and providing and operating computer facilities for the reporting of trading in unlisted and unquoted equity securities in Ontario pursuant to section 153 of Part VI;

WHEREAS for the purposes of this agreement the following definitions shall apply:

"Act" means the Securities Act, R.S.O. 1990, c. S.5 as amended;

"CDN Policy" means that policy which has been adopted by CDN board of directors respecting trading in unlisted and unquoted equity securities in Ontario;

"OTC security" shall have the same meaning as "COATS security" as defined in section 152 of Part VI;

"Person" means a "person" as that term is defined in the Act;

"User" means a registrant under the Act and who reports trades on the OTC System;

WHEREAS in order to assist CUB in its operation of the OTC System, the Commission may obtain and provide to CUB such information as the Commission deems appropriate, including information:

(i) on disciplinary or other action the Commission determines to take against a User which, in the Commission's view, will have a material impact on the User's participation in the OTC System; and

(ii) relating to issuers of OTC Securities, registrants under the Act or any other Persons that leads the Commission to believe that there has been or will be a breach of the terms and conditions of Part VI.

WHEREAS the Commission and CUB have agreed that in the event that the OTC system is implemented prior to the implementation of the OSC's rules governing alternative trading systems (the "ATS Rules") the OTC System shall be regulated in the following two phases:

(i) for the period commencing on the date of implementation of the OTC System and ending on the date of the implementation of a local Ontario rule relating to Ontario OTC trading which will be implemented concurrently with the ATS Rules or such other rules as the OSC may apply to Ontario OTC trading (the "Ontario Local Rule"), the OTC System will be regulated in accordance with Part VI and those portions of the CDN Policy pertaining to trade reporting of unlisted and unquoted equity securities in Ontario as in effect at 5:00 p.m. EST October 6, 2000; and

(ii) commencing on the date of the implementation of the Ontario Local Rule and ending on the date of the termination of the Agreement, the OTC System will be regulated in accordance with the Ontario Local Rule.

WHEREAS CUB will provide monitoring and surveillance services to the OSC in respect of trading in securities reported through the OTC System. CUB will not provide enforcement services in respect of the market participants using the OTC System.

WHEREAS CUB will refer any matters relating to a suspected violation of applicable trading rules or securities laws to the OSC or other applicable securities regulatory body.

WHEREAS CUB has agreed to provide to the OSC on request all such trading and surveillance data collected by CUB in respect of the OTC System as the OSC may require.

WHEREAS the OSC requires registered dealers to act in accordance with applicable securities legislation including but not limited to the obligation to deal fairly, honestly and in good faith with its customers.

WHEREAS the OSC expects registered dealers, as part of their general obligations, to have policies and procedures which enable them to operate in a manner which is consistent with the requirements set out in the OTC Terms and Conditions (as defined below);

NOW, THEREFORE, in consideration of CUB permitting the undersigned User to utilize the OTC System, the User agrees with CUB as follows:

1. The User is a registered dealer within the meaning of the Act and shall at all times act in accordance with applicable securities legislation including but not limited to the obligation to deal fairly, honestly and in good faith with its customers and shall have policies and procedures which enable them to operate in a manner which is consistent with the requirements set out in the OTC Terms and Conditions (as defined below);

2. Until such time as the Ontario Local Rule is implemented, the User agrees that the OTC System will be operated and governed in accordance with:

(i) Part VI and those portions of the CDN Policy pertaining to trade reporting of unlisted and unquoted equity securities in Ontario as in effect at 5:00 p.m. EST on October 6, 2000; and

(ii) such directives as may be issued by authority of the Board of Directors of CUB in respect of the use of the OTC System;

(collectively, the "OTC Terms and Conditions" which are attached as Schedule "A" to this Agreement) and the User shall comply with the OTC Terms and Conditions.

3. The User shall promptly communicate to CUB transaction reports with respect to OTC securities in accordance with the OTC Terms and Conditions;

4. The User shall comply with all requirements of the OTC Terms and Conditions and without limiting the generality of the foregoing, all Users acknowledge and agree:

(i) that they will provide to CUB any and all records, reports, and information required or requested by CUB in order for CUB to satisfy its regulatory obligations, in such manner and form, including electronically, as may be required by CUB from time to time;

(ii) that they will permit CUB or its designate to inspect their records at any time;

(iii) that CUB may suspend the User's access to the OTC System pending a determination of the OSC in respect of any referral by CUB to the OSC of any suspected violation of the User's obligation to comply with section 1 above; and

(iv) that CUB may terminate the User's access to the OTC System upon notification to CUB by the OSC that the User has violated the OTC Terms and Conditions.

5. The User shall pay, when due, any applicable fees or charges established by CUB from time to time and which current fees and charges are attached as Schedule "B" to this Agreement.

6. The User acknowledges that it is possible that from time to time the OTC System may be disrupted, contain inaccurate information, omit required information or may otherwise operate in an unsatisfactory manner (such events being hereinafter referred to as "Errors") whether through malfunction of equipment, power failure, human error or other reason. The causes of such Errors may be attributable to CUB, the Exchange, negligent or wilful acts or omissions of current or former directors, governors, officers, employees or committee members of CUB or the Exchange (hereinafter collectively referred to as "Personnel") or persons or companies who have supplied goods or services to either CUB or the Exchange in connection with the OTC System (hereinafter referred to as "Contractors").

7. It is acknowledged that neither CUB nor the Exchange assumes any responsibility with respect to the use to which the User, its employees or agents puts the facilities, services or the information obtained therefrom or with respect to the results of such use. It is further acknowledged that the information, services and facilities provided hereunder are provided on the express condition that Users making use of them assent that no liability whatsoever in relation thereto shall be incurred by CUB, the Exchange or Personnel.

8. The User agrees that none of CUB, the Exchange or Personnel shall have any liability whatsoever to the User with respect to any loss, damage, cost, expense or other liability or claim suffered or incurred by or made against the User, directly or indirectly, by reason of Errors, or arising from any negligent, reckless or wilful act or omission or out of the use, operation or regulation of the OTC System by CUB, the Exchange, Personnel or Contractors, or otherwise as a result of the use by the User of the facilities, services or information provided by CUB or the Exchange. By making use of the facilities, services or information provided by CUB or the Exchange the User expressly agrees to accept all liability arising from such use.

9. It is acknowledged by the User that the sole remedy for any wilful or negligent act or omission of any Personnel or Contractors shall be appropriate action, of a disciplinary nature or otherwise, instituted solely at the discretion of CUB or the Exchange.

10. CUB may terminate or amend this Agreement, subject to the approval of its Board of Directors and upon notice to the User, and any subsequent participation of the User in the OTC System shall constitute acceptance by the User of any such amendment.

11. It is acknowledged that neither CUB nor the Exchange shall incur any liability to the User with respect to any loss or damage whatsoever that the User may suffer, directly or indirectly, by reason of any termination of this Agreement.

12. In the event that any legal proceeding is brought or threatened against CUB, the Exchange, Personnel or Contractors to impose liability which arises directly or indirectly from the use by the User of the OTC System or from the use by the User of the facilities, services or information provided by CUB or the Exchange, the User agrees to indemnify and save CUB and the Exchange harmless from and against:

(i) all liabilities, damages, losses, costs, charges and expenses of every nature and kind (including, without limitation, legal and professional fees) incurred by CUB or the Exchange in connection with the proceeding, including costs incurred to indemnify Personnel;

(ii) any recovery adjudged against CUB, the Exchange or Personnel in the event that any of them is found to be liable; and

(iii) any payment by CUB or the Exchange, made with the consent of the User, in settlement of such proceeding.

13. Except as otherwise expressly provided herein, all of the terms used in this Agreement which are defined in OTC Terms and Conditions are used herein as so defined.

14. This Agreement shall be governed by and construed in accordance with the laws of the Province of Ontario.

15. The Agreement shall not be binding until accepted in writing by CUB.

16. The Agreement shall be effective as of the date accepted in writing by CUB.

[Insert Name of User]

By:____________________________

Authorized Signatory

____________________________

Name and Title of Authorized Signatory

(Please Print Name and Title)

By:____________________________

Authorized Signatory

____________________________

Name and Title of Authorized Signatory

(Please Print Name and Title)

Accepted this ___ day of _________, 200__

CANADIAN UNLISTED BOARD INC.

By:____________________________

Schedule "A" to User Agreement

OTC Terms and Conditions

A. Transaction Reporting

1. Operation and Administration of OTC System

1.1. All Users shall comply with the Terms and Conditions governing the operation and administration of the OTC System, which Terms and Conditions shall include:

1.2. those matters set forth in Part VI applicable to trade reporting in respect of over-the-counter equity securities in Ontario;

1.3. those portions of the former CDN Policy pertaining to trade reporting of unlisted and unquoted equity securities in Ontario as in effect at 5:00 p.m. EST on October 6, 2000 and incorporated herein; and

1.4. such directives as may be issued by authority of the Board of Directors of CUB in respect of the use of the OTC System.

2. Trades to be Reported

2.1 Pursuant to Part VI, every purchase or sale in Ontario of an OTC security made by a registered dealer, as principal or agent, must be reported through the OTC System, with the following exceptions (which shall not be reported through the OTC System):

2.1.1 a trade made through the facilities of a stock exchange or other organized market recognized and identified in this section A-2;

2.1.2. a distribution effected in accordance with the Act by or on behalf of an issuer; or

2.1.3. a secondary trade made in reliance on the exemptions in clauses 72(1)(a), (c) or (d) of the Act.

2.2. Where a security that is listed on one or more of the Canadian stock exchanges becomes suspended (i.e., it is no longer posted for trading) on all such exchanges, then any trade in that security by a registered dealer shall become reportable through the OTC System if that security and trade is otherwise required to be reported through the OTC System.

2.3. The obligation to report a trade in an OTC security applies only with respect to purchases and sales in Ontario of such security. A purchase or sale in Ontario for the purpose of these OTC Terms and Conditions is one in which either:

2.3.1. the person to whom the trade is confirmed (other than a User) is a resident of Ontario; or

2.3.2. the User's trader or sales representative handling the trade is acting from an Ontario office (irrespective of whether the User is acting as principal or agent).

2.4. Transactions that are merely booked through a User's inventory for purposes of adding a usual mark-up or commission in respect of trades which, for all intents and purposes, are agency trades on NASDAQ or a foreign stock exchange, need not be reported through the OTC System. Such transactions are considered to be trades made through the facilities of a foreign stock exchange or NASDAQ.

2.5. With respect to clause 2.1.1 above, CUB recognizes NASDAQ, The International Stock Exchange of the United Kingdom and the Republic of Ireland Limited, and all stock exchanges outside of Canada that require participants to report details of transactions and publish such details.

2.6. Trades may not be aggregated for reporting purposes except that trades from orders received prior to the opening of the OTC System and simultaneously reported at the opening may be aggregated into a single transaction report.

3. Who Reports Trades

3.1. Every purchase or sale in an OTC security that is required to be reported under subsection A-2 above shall be reported on the OTC System in accordance with the following provisions:

3.1.1. Where the transaction involves only one User, that User shall report the trade.

3.1.2. Where the transaction involves two Users, the User by or through whom the sale is made shall report the trade.

3.1.3. Where the transaction is not a trade in Ontario for the seller, the User by or through whom the purchase is made must report the trade.

4. Method, Timing and Content of Trade Reports

4.1. For reporting purposes, a trade is a transaction between a User and a given client, or another User, in a specific OTC security, at a given price, and executed at a certain time.

4.2. For the purposes of this section A-4, "Reportable Trades" shall mean every purchase or sale in an OTC security that is required to be reported under subsection A-3.

4.3. All trade tickets for Reportable Trades shall be time stamped at the time of execution.

4.4. All Reportable Trades taking place at or between 9:30 A.M. and 5:00 P.M. on a business day shall be reported through the OTC System within three minutes after execution.

4.5. All Reportable Trades taking place after 5:00 P.M. on a business day and prior to 9:30 A.M. the next business day shall be reported through the OTC System between 8:30 A.M. and 9:30 A.M. the next business day and shall form part of the trading statistics for the next business day.

4.6. All reports of Reportable Trades shall contain the following information:

4.6.1. symbol of the OTC security traded;

4.6.2. number of shares traded;

4.6.3. price of the trade as required by section A-5;

4.6.4. the identities of the purchasing and selling Users;

4.6.5. the time of execution of the transaction; and

4.6.6. any trade marker required by these OTC Terms and Conditions.

5. Price to be Reported

5.1. The price to be reported is the price at which the User actually traded with its customer, adjusted by the amount that would be customary as a commission or spread in such transaction.

5.2 A trade with another User is to be reported at the actual price agreed upon. This applies to a trade in which the reporting User is acting as agent for a customer, as well as to a trade in which the User acts as principal vis-a-vis the other User.

B. Dealers' Obligations

1. Prices to Customers

1.1. Spread or Mark-Up: Where a trade is substantially an agency transaction, the size of any spread or "mark-up" should reflect the riskless nature of the transaction.

1.2 Interpositioning: Users shall not arrange or otherwise participate in any transaction which interpositions an intermediary or other third party in a way that will result in an unfavourable price for a customer of any User.

1.3 Users shall not enter into any transaction with a customer for any OTC security at any price that is not reasonably related to the then current market price of that security or charge a customer a commission or service charge that is not fair and reasonable in all the circumstances.

2. Fair Dealings

2.1 Users shall transact business openly and fairly and in accordance with just and equitable principles of trade. No fictitious sale or contract shall be made in an OTC security.

3. Customer Priority

3.1. No User Shall:

3.1.1 buy or initiate the purchase of a OTC security for its own account or for any account in which it or any person associated with it is directly or indirectly interested, while such User holds or has knowledge that any person associated with it holds an unexecuted market order or limit price order to buy such security for a customer;

3.1.2 sell or initiate the sale of any OTC security for its own account or for any account in which it or any person associated with it is directly or indirectly interested, while it holds or has knowledge that any person associated with it holds an unexecuted market order or limit price order to sell such security for a customer.

3.2. The provisions of this section shall not apply:

3.2.1 to any purchase or sale of any OTC security in an amount less than the customary unit of trading made by a User to offset odd-lot orders for customers;

3.2.2 to any purchase or sale of any OTC security upon terms for delivery other than those specified in such unexecuted market or limit price order; or

3.2.3 to any unexecuted order that is subject to a condition that has not been satisfied.

3.3. For purposes of this section a User may include a reasonable commission charge in determining whether its customer's order is at the same price as a principal order.

4. Best Market Price

4.1 Where a User executes a trade with or for its client for an OTC security that is posted for trading on a foreign market recognized under this subsection, the User shall execute the trade on behalf of the client at a price equal to or better than the market price in the foreign market (taking exchange rates into account), plus or minus (as the case may be) a reasonable commission and any added cost of executing the order in the foreign market.

4.2. For the purpose of this subsection, CUB presently recognizes any foreign stock exchange or organized market that provides real time public dissemination of information, including firm market quotations and trading statistics.

5. Manipulative or Deceptive Trading

5.1. A User shall not use or knowingly participate in the use of any manipulative or deceptive method of trading in connection with the purchase or sale of an OTC security that creates or may create a false or misleading appearance of trading activity or an artificial price for the said security. Without in any way limiting the generality of the foregoing, the following shall be deemed manipulative or deceptive methods of trading:

5.1.1 making a fictitious trade or giving or accepting an order which involves no change in the beneficial ownership of an OTC security;

5.1.2 entering an order or orders for the purchase of an OTC security with the knowledge that an order or orders of substantially the same size, at substantially the same time and at substantially the same price for the sale of any such security, has been or will be entered by or for the same or different persons and with the intention of creating a false or misleading appearance of active public trading in a security or with respect to the market price of an OTC security;

5.1.3 entering an order or orders for the sale of an OTC security with the knowledge that an order or orders of substantially the same size, at substantially the same time and at substantially the same price for the purchase of such security, has been or will be entered by or for the same or different person and with the intention of creating a false or misleading appearance of active public trading in a security or with respect to the market price of an OTC security;

5.1.4 making purchases of, or offers to purchase an OTC security at successively higher prices, or sales of or offers to sell any such security at successively lower prices for the purpose of creating or inducing a false or misleading appearance of trading in such security or for the purpose of unduly or improperly influencing the market price of such security; or

5.1.5 effecting, alone or with one or more persons, a series of trades in an OTC security, for the purpose of inducing the purchase or sale of such security, which creates actual or apparent trading in such security or raises or depresses the price of such security.

6. Restrictions on Trading During Distributions

Restricted Users

6.1 The restrictions on trading during a distribution set out in this part 6.1 entitled "Restricted Users" apply to a User (a "restricted User") involved in a distribution by prospectus of an OTC security or a distribution by prospectus, Exchange Offering Prospectus, Statement of Material Facts or "wide distribution" of a security that is related to an OTC security. The restrictions do not apply to a User involved in a distribution only as a selling group member that is not obligated to purchase any unsold securities.

6.1.1 Two securities are "related" if they have substantially the same characteristics, or

(a) one is immediately convertible, exercisable or exchangeable into the other; and

(b) the conversion, exercise or exchange price at the beginning of the restricted period (as defined below) is less than 110% of the offer price of the underlying security on the principal market where the underlying security is traded.

6.1.2 A "wide distribution" means a series of distribution principal trades to not less than 25 separate and unrelated client accounts, no one of which participate to the extent of more than 50% of the total value of the distribution

Restrictions

6.1.3 During the restricted period, a restricted User shall not bid for or purchase an OTC security that is being distributed or that is related to a security being distributed except as follows:

Distributed Securities

6.1.4. Restricted User Not Short. A restricted User that is not short the OTC security being distributed may bid for or purchase it at or below the lower of the highest independent bid price at the time of the bid or purchase and the distribution price.

(a) A restricted User may bid for or purchase the OTC security being distributed at or below the distribution price.

(b) A restricted User that makes an initial bid below the distribution price shall not raise that bid price during the restricted period.

6.1.5. Restricted User Short. A restricted User that is short the OTC security being distributed may bid for or purchase it at or below the distribution price.

Related Securities

6.1.6. A restricted User may bid for or purchase a related OTC security at or below the highest independent bid price.

6.1.7. If there is no independent bid price for a related OTC security, a restricted User shall not bid for or purchase that security without the prior consent of CUB.

(a) A bid price is "independent" if it is for the account of a User that is not involved in the distribution or is involved only as a member of a selling group.

(b) A restricted User shall not solicit purchase orders for the OTC security being distributed or any related OTC security during the restricted period except orders to purchase OTC securities being sold pursuant to the distribution.

(c) The above restrictions do not affect sales by restricted Users to unsolicited client buy orders. In the case of an OTC security that will be listed on the Toronto Stock Exchange ("TSE") or the Canadian Venture Exchange Inc. ("CDNX") and until such time as the OTC security is actually listed and posted for trading on the TSE or CDNX and the TSE's or CDNX's market stabilization rules apply, Users must comply with the above market stabilization restrictions.

All Users

6.2. The restrictions on trading during a distribution set out in this part 6.2 entitled "All Users" apply to all Users

Restrictions

6.2.1 During the restricted period, no User shall participate in a trade of an OTC security that is being distributed or that is related to an OTC security being distributed involving a purchase by or on behalf of:

(a) the issuer of the OTC security;

(b) a selling OTC security holder whose securities are being distributed;

(c) an affiliate of the issuer or selling OTC security holder; or

(d) a person acting jointly or in concert with any of the foregoing.

6.3. The "restricted period" begins on the later of:

6.3.1. the ninth trading day (or, in the case of a OTC security that is related to a TSE or CDNX-listed security, the second trading day) prior to the date on which the offering price of the OTC securities to be distributed is determined; and

6.3.2. the date on which the restricted User agrees to participate in a distribution, whether or not the terms and conditions of such participation have been agreed upon.

6.3.3. The restricted period ends on the earlier of:

(a) the ninth trading day (or, in the case of a OTC security that is related to a TSE or CDNX listed security, the second trading day) prior to the date on which the offering price of the OTC securities to be distributed is determined; and

(b) the date on which the restricted User has sold all of the OTC securities allotted to it (including all securities acquired by it in connection with the distribution) and any stabilization arrangements to which it is a party have been terminated; and

(c) the date on which the distribution has been terminated pursuant to applicable securities legislation,

provided that, if purchasers of 5% or more of the OTC securities allotted to or acquired by a restricted User in connection with a distribution give notice that they intend to exercise their statutory rights of withdrawal, the restricted period shall again apply to that User until the OTC securities are resold or the distribution ends, as provided above. Securities are not considered "sold" before the receipt for the final prospectus has been issued.

7. Disclosure of Interest or Control

7.1. Any User that is an insider (as that term is defined in the Act) or is controlled by, directly or indirectly, controls, or is under common control of any issuer must disclose to its customers prior to, and confirm, in writing, at the time of buying or selling any OTC security of such an issuer, the nature and existence of any such relationship.

8. System Failures

8.1. Trades made during an OTC system power failure or any other event that would fully or partially disable the system or cause it to malfunction must be reported on the system immediately upon the system being available to accept such data.

9. Settlement Rules

9.1. The settlement of transactions shall conform to the rules and practices of the TSE, CDNX and The Canadian Depository for Securities Limited.

C. Fees And Charges

1. Every User shall pay the applicable OTC System fees.

2. All fees and charges of CUB, including, but not limited to, the fees charged for transaction reports shall be determined by CUB's board of directors.

D. Access

1. Where the Commission has provided CUB with information relating to:

1.1. disciplinary or other action the Commission determines to take against a User which, in the Commission's view will have a material impact on the User's participation in the OTC System; or

1.2. the issuers of OTC Securities, registrants under the Act or any other persons that leads the Commission to believe that there has been or will be a breach of the terms and conditions of Part VI.

2. CUB may suspend the Users access to the OTC System pending a determination by the Commission in respect of such matters.

3. Where CUB has referred any matter relating to a suspected violation by a User of the OTC Terms and Conditions, CUB may suspend the Users access to the OTC System pending a determination by the Commission in respect of such matters.

4. Where the Commission has notified CUB that a User has violated the OTC Terms and Conditions, CUB may terminate the User's access to the OTC System

E. Miscellaneous

1. All references to a "business day" in this Schedule "A" shall mean any day from Monday to Friday inclusive.

2. All references to a time of day in the Schedule "A" shall mean Eastern Standard Time.

Schedule "B" to User Agreement

Canadian Unlisted Board Inc. User and Transaction Fees

1. USER TRANSACTION FEE

$1.95/trade (each side)

2. USER FEE:

Monthly Fee of $150.00

per Employee CUB access ID granted,

up to a maximum of $500.00/month per User

APPENDIX 3

REVISIONS TO CORPORATE FINANCE MANUAL

RE: REPORTING ISSUER STATUS OF EXCHANGE

LISTED ISSUERS

Policy 1.1 -- Interpretation

The following definitions will be included in Policy 1.1:

"BHs" means those beneficial shareholders of an Issuer that are included in either:

(a) a DSR for the Issuer and whose shares were disclosed in the Issuer's books and records or list of registered shareholders as being held by an intermediary; or

(b) after the implementation of National Instrument 54-101 -- Communication with Beneficial Owners of Securities of a Reporting Issuer, a NOBO list for the Issuer.

"DSR" means the Demographic Summary Report available from the International Investors Communications Corporation ("IICC").

"NOBO list" refers to a 'non-objecting beneficial owner list' as defined in National Instrument 54-101 Communication with Beneficial Owners of Securities of a Reporting Issuer.

"NOBOs" refers to non objecting beneficial owners as defined in National Instrument 54-101.

"RHs" means the registered shareholders of the Issuer that are beneficial owners of the equity securities of the Issuer. For the purposes of this definition, where the beneficial owner controls or is an affiliate of the registered shareholder, the registered shareholder shall be deemed to be the beneficial owner.

"Significant Connection to Ontario" exists where an Issuer has:

(a) RHs and BHs resident in Ontario who beneficially own more than 20% of the total number of equity securities beneficially owned by the RHs and the BHs of the Issuer; or

(b) its mind and management principally located in Ontario and has RHs and BHs resident in Ontario who beneficially own more than 10% of the number of equity securities beneficially owned by the RHs and the BHs of the Issuer.

The residence of the majority of the board of directors in Ontario or the residence of the President or the Chief Executive Officer in Ontario may be considered determinative in assessing whether the mind and management of the Issuer is principally located in Ontario.

Policy 2.3 -- Listing Procedures

The following section 5 will be included in Policy 2.3:

5. Significant Connection to Ontario

5.1 Where it appears to the Exchange that an Issuer undertaking an Initial Listing on the Exchange has a Significant Connection to Ontario, the Exchange will, as a condition of its acceptance of the Initial Listing, require the Issuer to provide the Exchange with evidence that it has made a bona fide application to become a reporting issuer in Ontario. See Policy 3.1- Directors, Officers, Other Insiders & Personnel, and Corporate Governance for details on becoming a reporting issuer in Ontario.

Policy 2.4 -- Capital Pool Companies

The following subsection 12.6 will be included in Section 12, Qualifying Transaction, of Policy 2.4:

12.6 Assessment of a Significant Connection to Ontario

Where a Resulting Issuer, upon Completion of a Qualifying Transaction, is aware that it has a Significant Connection to Ontario, it must immediately notify the Exchange and make application to the Ontario Securities Commission to be deemed a reporting issuer pursuant to section 18.2 of Policy 3.1- Directors, Officers, Other Insiders & Personnel, and Corporate Governance.

Policy 2.9 -- Trading Halts, Suspensions and Delisting

The following clause (h) will be included in section 3.1, Reasons for Suspension, of Policy 2.9:

3.1 The Exchange may impose a suspension in a variety of circumstances including where:

(h) an Issuer fails to comply with a direction or requirement of the Exchange to make application for and obtain reporting issuer status in Ontario when it has a Significant Connection to Ontario.

Policy 3.1 -- Directors, Officers, Other Insiders & Personnel and Corporate Governance

The following sections will be included in Policy 3.1:

Subsection 5.20 will be included in section 5, Qualifications and Duties of Directors and Officers:

5.20 Refusal or Revocation of Exchange Acceptance -- Ontario

5.20 Where an Issuer has a Significant Connection to Ontario, and has not complied with a direction or requirement of the Exchange to make application or to become a reporting issuer in Ontario, the Exchange may refuse to grant Exchange Acceptance of any application relating to the acceptability of any Insider. The Exchange may also revoke, amend or impose conditions in connection with a previous Exchange Acceptance of any such application, until such time as the Issuer has complied with a direction or requirement (See section 18, Assessment of a Significant Connection to Ontario of this Policy).

Section 18 will be included in Policy 3.1

18. Assessment of a Significant Connection to Ontario

18.1 All Issuers, that are not otherwise reporting issuers in Ontario are required to assess whether they have a Significant Connection to Ontario.

18.2 Where an Issuer that is not otherwise a reporting issuer in Ontario becomes aware that it has a Significant Connection to Ontario as a result of complying with subsection 18.1 above or otherwise, the Issuer is required to immediately notify the Exchange, and promptly make a bona fide application to the Ontario Securities Commission to be deemed a reporting issuer in Ontario. The Issuer must become a reporting issuer in Ontario within six months of becoming aware that it has a Significant Connection to Ontario.

18.3 All Issuers, that are not otherwise reporting issuers in Ontario are required to assess on an annual basis, in connection with the preparation for mailing of their annual financial statements, whether they have a Significant Connection to Ontario. All Issuers must obtain and maintain for a period of three years after each annual review, evidence of the residency of the RHs and BHs of the Issuer.

18.4 If requested, Issuers must provide the Exchange with evidence of the residency of their NOBOs.

Policy 5.2 -- Changes of Business and Reverse Takeovers

The following subsection 10.6 will be included in Section 10, Other Requirements, of Policy 5.2:

10.6 Assessment of a Significant Connection to Ontario

Where, pursuant to an RTO, a Resulting Issuer will have a Significant Connection to Ontario, it must immediately notify the Exchange and make an application to be deemed a reporting issuer pursuant to section 19.2 of Policy 3.1 -- Directors, Officers, Other Insiders & Personnel and Corporate Governance.

APPENDIX 4

POLICY 5.9

PROTECTION OF MINORITY SECURITY HOLDERS

IN SPECIAL TRANSACTIONS

Scope of Policy

This Policy incorporates Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions, together with the Companion Policy 61-101CP (collectively the "MI 61-101"). Copies of MI 61-101 can be found on the website of the Ontario Securities Commission (www.osc.gov.on.ca) or the Autorité des marches financiers (www.lautorite.qc.ca)

The main headings of this Policy are:

1. Definitions

2. Application of the MI 61-101

3. Exemptions

1. Definitions

1.1 Definitions contained in MI 61-101 that are inconsistent with definitions contained within other Policies are applicable only to the interpretation of this Policy.

2. Application of MI 61-101

2.1 This Policy applies to all Issuers listed on the Exchange or Companies seeking listing on the Exchange.

2.2 Subject to the exemptions in section 3 of this Policy, MI 61-101 is adopted, in its entirety, as a Policy of the Exchange.

2.3 In addition to insider bids and issuer bids, this Policy may be applicable to certain transactions undertaken pursuant to the following Policies:

(a) Policy 2.4 -- Capital Pool Companies,

(b)Policy 4.1 -- Private Placements,

(c) Policy 5.2 -- Changes of Business and Reverse Takeovers, and

(d) Policy 5.3 -- Acquisitions and Dispositions of Non-Cash Assets.

3. Exemptions

Applicability of Valuation Exemptions

3.1 Issuers should note that MI 61-101 provides exemptions from the valuation requirements in respect of business combinations and related party transactions for Exchange-listed Issuers that do not have their securities interlisted on certain specified markets. However, the Exchange may nonetheless require an Issuer to provide evidence of value to the Exchange in accordance with sections 4.1, 4.2, 4.3, 4.4 or 4.5 of Policy 5.4.

Exemptions from other MI 61-101 Requirements

3.2 An Issuer that is subject to MI 61-101 may apply, independently of this Policy, to the appropriate securities regulator or securities regulatory authority in Ontario or Québec, as the case may be, for a discretionary exemption from any requirements of MI 61-101. However, the Issuer must concurrently make an application to the Exchange and provide a copy of any subsequent and related correspondence to the Exchange. The Exchange will consider such applications on a case by case basis, and may elect not to grant an exemption despite a favourable decision of a securities regulator or securities regulatory authority. Issuers should consult with the Exchange in advance of any application for exemption to a securities regulator, or securities regulatory authority, to determine whether or not the Exchange will grant an exemption.

3.3 For more certainty, where an Issuer seeking an exemption from this Policy is not subject to MI 61-101, an application need only be made to the Exchange.

"original signed by"	"original signed by"
Glenda Campbell, QC	Stephen Murison
Vice-Chair	Vice-Chair