Sprott Asset Management LP et al.

January 31, 2012

Decision

Headnote

National Policy 11-203 Process for Exemptive Relief Decisions in Multiple Jurisdictions -- exemption granted to (i) gold corporate class fund to invest 100% of assets in and underlying gold fund (ii) silver corporate class fund to invest 100% of assets in underlying silver fund (iii) resources fund to invest up to 10% combined in gold, silver, gold and silver certificates or specified derivatives of which the underlying interest is gold or silver and to house gold and silver bullion in and outside Canada with Brinks or ViaMat as sub-sub-custodians, and (iv) silver equities fund to invest up to 20% of net assets in silver, silver certificates and specified derivatives of which the underlying interest is gold and to house silver bullion in and outside Canada with Brinks or ViaMat as sub-sub-custodian.

Applicable Legislative Provisions

National Instrument 81-102 Mutual Funds, ss. 2.3(e), 2.3(f), 2.3(h), 6.1(2)(b), 6.1(3)(b), 6.2, 6.3, 19.1.

January 31, 2012

IN THE MATTER OF

THE SECURITIES LEGISLATION OF

ONTARIO

(the Jurisdiction)

AND

IN THE MATTER OF

THE PROCESS FOR EXEMPTIVE RELIEF

APPLICATIONS IN MULTIPLE JURISDICTIONS

AND

IN THE MATTER OF

SPROTT ASSET MANAGEMENT LP

(the Manager or the Filer)

AND

IN THE MATTER OF

SPROTT RESOURCE CLASS

SPROTT SILVER EQUITIES CLASS

SPROTT SILVER BULLION CLASS

SPROTT GOLD BULLION CLASS

(the Funds)

AND

IN THE MATTER OF

RBC DEXIA INVESTOR SERVICES TRUST

(the Custodian)

AND

IN THE MATTER OF

THE BANK OF NOVA SCOTIA

(the Bullion Custodian)

DECISION

Background

The principal regulator in the Jurisdiction has received an application from the Filer for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) for an exemption, pursuant to section 19.1 of National Instrument 81-102 Mutual Funds (NI 81-102) from the following provisions of NI 81-102:

(a) clause 2.3(f) and 2.3(h) of NI 81-102 to permit Sprott Silver Bullion Class (the Silver Top Fund) to invest, individually through the Silver Bottom Fund (as defined below), up to 100% of its net assets in silver and/or silver certificates;

(b) clause 2.3(e) of NI 81-102 to permit Sprott Gold Bullion Class (the Gold Top Fund) to invest, individually through the Gold Bottom Fund (as defined below), up to 100% of its net assets in gold and/or permitted gold certificates (collectively, the Silver Top Fund and the Gold Top Fund are the Top Funds);

(c) subsections 2.3(f) and 2.3(h) of NI 81-102 to permit Sprott Resource Class (the Resource Class) to invest up to 10% in total of its net assets, taken at market value thereof at the time of the purchase, directly in gold, permitted gold certificates, silver, silver certificates and/or specified derivatives of which the underlying interest is gold or silver;

(d) clause 2.3(f) and 2.3(h) of NI 81-102 to permit Sprott Silver Equities Class (the Silver Equities Class) to invest up to 20% in total of its net assets, taken at the market value thereof at the time of purchase, directly in silver, silver certificates and/or specified derivatives of which the underlying interest is silver (collectively, the Resource Class and the Silver Equities Class are the Bullion Classes);

(e) clause 6.1(2)(b) of NI 81-102, to permit the physical silver and/or gold bullion of the Bullion Classes (the bullion) to be held outside of Canada by the Bank of Nova Scotia (the Bullion Custodian) or Brinks (as defined below) or Via Mat (as defined below) for purposes other than facilitating portfolio transactions of the Bullion Classes;

(f) clause 6.1(3)(b) of NI 81-102, to permit RBC Dexia Investor Services Trust (the Custodian) or the Bullion Custodian to appoint the Brinks Company, or its subsidiaries or affiliates (Brinks) or Via Mat International Ltd., or its subsidiaries or affiliates (Via Mat), which are persons or companies that are not described in sections 6.2 or 6.3 of NI 81-102, to act as sub-custodians to hold the Bullion Classes' physical bullion;

(g) section 6.2 of NI 81-102 to permit Brinks or Via Mat to be appointed as sub-custodians of the Bullion Classes to hold each Bullion Class' physical bullion in Canada; and

(h) section 6.3 of NI 81-102 to permit Brinks and Via Mat to be appointed as sub-custodians of the Bullion Classes to hold each Bullion Class' physical bullion outside Canada

(collectively, the Exemption Sought).

Interpretation

Terms defined in NI 81-102, National Instrument 14-101 Definitions and MI 11-102 have the same meaning if used in this decision, unless otherwise defined.

Representations

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

The Filer and the Funds

1. The Filer is a limited partnership established under the laws of the Province of Ontario and is registered as an adviser in the category of portfolio manger in Ontario, British Columbia, Alberta, Saskatchewan, Manitoba, New Brunswick, Nova Scotia and Newfoundland and Labrador and as an exempt market dealer and investment fund manager in Ontario.

2. The Filer is not in default of securities legislation in any province or territory of Canada.

3. The Filer will be the manager and portfolio adviser for the Silver Top Fund, the Gold Top Fund and the Silver Equities Class (individually, a New Class and collectively, the New Classes) and is the manager and portfolio adviser of the Resource Class.

4. Each New Class will be an open-end mutual fund. Each New Class will be a class of mutual fund shares of Sprott Corporate Class Inc., a mutual fund corporation existing under the laws of the Province of Ontario (the Corporation).

5. A preliminary simplified prospectus in respect of the New Classes was filed on SEDAR under project no. 1833196 on November 28, 2011. Once a final prospectus for the New Classes is filed and a receipt therefor is obtained, each New Class will be a reporting issuer under the securities legislation of each province and territory of Canada.

6. The Resource Class is an open-end mutual fund and is a class of mutual fund shares of the Corporation.

7. The Resource Class is not in default of securities legislation in any province or territory of Canada.

8. A simplified prospectus and annual information form in respect of the Resource Class each dated September 23, 2011 have been filed in each province and territory of Canada. The Resource Class is a reporting issuer under the securities legislation of each province and territory of Canada.

The Silver Top Fund

9. The Silver Top Fund will be a fund-of-fund that primarily invests in an underlying fund managed by the Filer.

10. The investment objective of the Silver Top Fund is to aim to seek to obtain exposure to silver. It seeks a similar return to its underlying fund, Sprott Silver Bullion Fund by investing substantially all of its assets in securities of that fund. The underlying fund invests primarily in unencumbered, fully allocated silver bullion and silver certificates. The underlying fund may also invest a portion of its assets in cash, money market instruments and/or treasury bills.

11. Sprott Silver Bullion Fund (the Silver Bottom Fund) is (a) an open-end mutual fund trust established under the laws of Ontario; (b) a reporting issuer under the securities laws of each of the provinces and territories of Canada; and (c) qualified for distribution in all provinces and territories of Canada.

12. On April 29, 2011, the Filer, on behalf of the Silver Bottom Fund, obtained relief from the restrictions contained in sections 2.3(f), 6.1(2)(b), 6.1(3)(b), 6.2 and 6.3 of NI 81-102 to permit the Silver Bottom Fund to invest 100% of its net assets, taken at market value at the time of purchase, in silver and/or silver certificates and to permit the physical silver bullion of the Silver Bottom Fund to be held inside and outside of Canada by the Bullion Custodian or Brinks or Via Mat (the Silver Relief).

13. The Silver Relief provides that the Filer will consider that other funds managed by it or its affiliates hold the underlying assets of the Silver Bottom Fund directly for the purposes of such other funds' compliance with sections 2.3(f) of NI 81-102 or conditions contained in a decision granting such other funds an exemption from section 2.3(f) of NI 81-102 (the Silver Deeming Provision).

14. Accordingly, by investing 100% of its assets in the Silver Bottom Fund, the Silver Top Fund will be deemed to hold the underlying assets of the Silver Bottom Fund directly for the purposes of section 2.3(f) of NI 81-102.

15. To implement the investment objectives and strategies of the Silver Top Fund, the Filer requires exemptive relief that would permit the Silver Top Fund to invest substantially all of its assets in securities of the Silver Bottom Fund and thereby obtain exposure to the silver.

16. The simplified prospectus of the Silver Top Fund will disclose that it invests directly in securities of the Silver Bottom Fund and that the Silver Top Fund will therefor indirectly hold the assets of the Silver Bottom Fund.

The Gold Top Fund

17. The Gold Top Fund will be a fund-of-fund that primarily invests in an underlying fund managed by the Filer.

18. The investment objective of the Gold Top Fund is to aim to seek to obtain exposure to gold. It will seek a similar return to its underlying fund, Sprott Gold Bullion Fund, by investing substantially all of its assets in securities of that fund. The underlying fund invests primarily in unencumbered, fully allocated gold bullion, permitted gold certificates, and/or closed-end funds the underlying interest of which is gold. The underlying fund may also invest a portion of its assets in cash, money market instruments and/or treasury bills.

19. Sprott Gold Bullion Fund (the Gold Bottom Fund) is (a) an open-end mutual fund trust established under the laws of Ontario; (b) a reporting issuer under the securities laws of each of the provinces and territories of Canada; and (c) qualified for distribution in all provinces and territories of Canada.

20. On March 10, 2009, the Filer, on behalf of the Gold Bottom Fund, obtained relief from the restrictions contained in section 2.3(e) of NI 81-102 to permit the Gold Bottom Fund to invest 100% of its net assets, taken at market value at the time of purchase, in gold and/or permitted gold certificates (the Gold Relief).

21. The Gold Relief provides that the Filer will include units of the Gold Bottom Fund held by other funds that it manages when assessing such other funds' compliance with section 2.3(e) of NI 81-102 or conditions contained in a decision granting such funds an exemption from section 2.3(e) of NI 81-102 (the Gold Deeming Provision) (collectively, the Silver Deeming Provision and the Gold Deeming Provision, are referred to herein as the Deeming Provisions).

22. Accordingly, by investing 100% of its assets in the Gold Bottom Fund, the Gold Top Fund will be deemed to hold the underlying assets of the Gold Bottom Fund directly for the purposes of section 2.3(e) of NI 81-102.

23. To implement the investment objectives and strategies of the Gold Top Fund, the Filer requires exemptive relief that would permit the Gold Top Fund to invest substantially all of its assets in securities of the Gold Bottom Fund and thereby obtain exposure to gold.

24. The simplified prospectus of the Gold Top Fund will disclose that it invests directly in securities of the Gold Bottom Fund and that the Gold Top Fund will therefore indirectly hold the assets of the Gold Bottom Fund.

The Bullion Classes

25. The investment objective of the Resource Class is to achieve long-term capital growth by investing primarily in equity and equity-related securities of companies in Canada and around the world that are involved directly or indirectly in the natural resource sector.

26. The investment objective of Silver Equities Class is to seek to achieve long-term capital growth. The Fund invests primarily in equity securities of companies that are directly or indirectly involved in the exploration, mining, production or distribution of silver. The Fund can also invest in silver and silver certificates.

27. All silver bullion purchased by the Bullion Classes will be in London Good Delivery bar form.

28. All gold bullion purchased by the Resource Class will be certified either London Good Delivery, COMEX Good Delivery or Zurich Good Delivery.

29. The simplified prospectus of each Bullion Class will disclose that one of the risks that a Bullion Class is exposed to is commodity risk.

30. The Filer believes that the markets in gold and silver are highly liquid, and there are no liquidity concerns with permitting (i) the Resource Class to invest up to 10% of its total net assets taken at market value at the time of the purchase, directly in gold, permitted gold certificates, silver, certain silver certificates and/or specified derivatives of which the underlying interest is gold or silver or (ii) the Silver Equities Class to invest up to 20% of its total net assets, taken at market value at the time of the purchase, directly in silver, certain silver certificates and/or specified derivatives of which the underlying interest is silver.

31. The Filer is well known in Canadian capital markets for its expertise and investment strategies involving gold and silver, and does a substantial amount of research in this area. The Filer believes this expertise and research would be beneficial to the securityholders of the Bullion Classes.

32. The Filer intends to invest in gold and silver as a defensive strategy in adverse market, economic, political or other circumstances. The Filer considers gold and silver to be a viable alternative to holding cash and cash equivalents in such markets.

33. Permitting the Resource Class to invest in gold and silver and the Silver Equities Class to invest in silver, will permit the Filer additional flexibility to increase gains for each Bullion Class in certain market conditions, which have otherwise caused each Bullion Class to have significant cash positions therefore deter from its ability to achieve its investment objective or providing long term capital growth.

34. The Filer believes that the potential volatility or speculative nature of silver (or the equivalent in certificates or specified derivatives of which the underlying interest is silver) is no greater than that of gold, or of equity securities of issuers in which the Bullion Classes invest and, in the portfolio context of the Bullion Classes, can provide additional diversification to the Bullion Classes.

Custody of Bullion Held by the Bullion Classes

35. Pursuant to a Custodian Agreement dated September 23, 2011, as amended (the Custodian Agreement), the Custodian acts as the custodian for each of the Funds. The Custodian will hold the property of the Funds other than each Bullion Class' physical bullion. The terms of the Custodian Agreement will comply with all requirements in Part 6 of NI 81-102.

36. The Custodian has appointed the Bullion Custodian to be a sub-custodian of the Bullion Classes and to hold each of the Bullion Class' physical bullion. The custody arrangements with respect to each of the Bullion Class' physical bullion are governed by the terms of a sub-custodian agreement between the Custodian and the Bullion Custodian (the Bullion Custodian Agreement). Except as represented below, the terms of the Bullion Custodian Agreement will comply with all requirements in Part 6 of NI 81-102.

37. Each Bullion Class' physical bullion will be stored and held either on an allocated and segregated basis in the vault facilities of the Bullion Custodian, in Canada, London, England or New York, U.S.A, or will be stored in the vault of a sub-custodian on an allocated and segregated basis in Canada, London, England or New York, U.S.A, where in the latter case it shall be identified as the property of the Bullion Custodian. The Bullion Custodian shall at all times record and identify in the books and records maintained by the Bullion Custodian that such bullion is being held on behalf of the Custodian. The Bullion Custodian is one of the largest providers of physical precious metals trading and custodial services in the world. The Filer has determined that the Bullion Custodian is the appropriate choice to provide custodial services to each Bullion Class because the Bullion Custodian is experienced in providing gold and silver storage and custodial services, and is familiar with the requirements relating to the physical handling and storage of bullion.

38. Each Bullion Class will not insure its physical bullion. The Bullion Custodian Agreement requires that the Bullion Custodian or any sub-custodian maintain insurance on such terms and conditions as it considers appropriate against all risk of physical loss of, or damage to, bullion stored in the Bullion Custodian's or such sub-custodian's vaults except the risk of war, nuclear incident, terrorism events or government confiscation. Neither the Filer, the Bullion Classes nor the Custodian are beneficiaries of any such insurance and none of them will have the ability to dictate the existence, nature or amount of coverage.

39. The Filer has discussed such insurance coverage with the Bullion Custodian, and believes that the insurance that the Bullion Custodian or any sub-custodian has obtained will be appropriate for each Bullion Class. The Bullion Custodian Agreement provides that the Bullion Custodian shall not cancel its insurance or permit its sub-custodian to cancel such insurance except upon 30 days prior written notice to the Filer. Each Bullion Class will disclose the material details of that insurance arrangement in its final annual information form.

40. The Bullion Custodian has advised the Filer and the Custodian that due to physical storage capacity constraints and, having regard to the amount of bullion which the Bullion Classes may acquire, there may not be sufficient space in the vault facilities of the Bullion Custodian to store all of the Bullion Classes' physical bullion.

41. As a result, the Bullion Custodian may be required to use the services of sub-custodians to store some of each Bullion Class' physical bullion.

42. The Bullion Custodian has advised the Custodian and the Filer that it proposes to use Brinks and Via Mat, as sub-custodians, if necessary, to hold the physical bullion of each Bullion Class. Brinks and Via Mat are not entities that are currently approved to act as a custodian or sub-custodian for assets held in Canada, or to act as a sub-custodian for assets held outside of Canada as Brinks and Via Mat are not, among other things, a bank listed in Schedule I, II or III of the Bank Act (Canada) or a trust company incorporated under the laws of Canada.

43. Brinks and Via Mat are leading providers of secure logistics for valuables, including diamonds, jewellery, precious metals, securities, currency and secure data, serving banks, retailers, governments, mines, refiners and metal traders. Brinks and Via Mat are both authorized depositories for the London Bullion Market Association and have vault facilities that are accepted as warehouses for the London Bullion Market Association. Brinks is also an authorized depository for NYMEX/COMEX.

44. The number of entities in Canada which are eligible to act as sub-custodians for the physical storage of bullion is limited. Of these eligible entities, some already have exclusive relationships with other investment funds for storage purposes whereas others simply may not have the excess capacity that the Bullion Classes may need to store physical bullion. These capacity constraints have been intensified due to the increased demand for physical commodities and the corresponding need to arrange for safe-keeping.

45. The Filer and the Bullion Custodian believe that both Brinks and Via Mat are appropriate sub-custodians for each Bullion Class' physical bullion. The Bullion Custodian has engaged in a review of the facilities, procedures, records and the level of insurance coverage of Brinks and Via Mat, and will engage in a similar review annually, to satisfy itself as to the continuing appropriateness of using Brinks and Via Mat as sub-custodians of each Bullion Class' physical bullion.

46. The custody arrangements with respect to the holding of each Bullion Class' physical bullion by Brinks or Via Mat will be governed by the terms of an agreement between the Bullion Custodian and Brinks or Via Mat, as the case may be, (the Bullion Sub-Custodian Agreements), the terms of which will comply with Part 6 of NI 81-102, except as represented herein.

47. To the best of the Filer's, the Bullion Classes', the Custodian's and the Bullion Custodian's knowledge, the Custodian Agreement, the Bullion Custodian Agreement and the Bullion Sub-Custodian Agreements are consistent with industry practice.

48. In relation to each Bullion Class, the sub-custodial activities of Brinks and Via Mat will be limited to holding its physical bullion. All physical bullion of each Bullion Class held by Brinks and Via Mat will be held in vault facilities in Canada, London, England or New York, U.S.A, on an allocated and segregated basis. The Bullion Custodian will exercise its audit rights under each Bullion Sub-Custodian Agreement on an on-going basis in order to satisfy itself that Brinks and Via Mat are in substantial compliance with the terms of the relevant Bullion Sub-Custodian Agreement and, in particular, that the bullion of each Bullion Class which the Bullion Custodian has transferred to Brinks and Via Mat on behalf of each Bullion Class (i) is held by Brinks and Via Mat at vault facilities that are accepted as warehouses for the London Bullion Market Association, (ii) is physically segregated and specifically identified, both in the vault facilities in which such bullion is held by Brinks and Via Mat and on the books and records of Brinks and Via Mat, as constituting the property of the Bullion Custodian or the Bullion Class, as applicable (iii) has not sustained loss, damage or destruction (but with no obligation on the part of the Bullion Custodian to verify the weight, quality, fineness, assay characteristics, authenticity or composition of such bullion or that such bullion conforms to any good delivery standards for the London Bullion Market Association, NYMEX/COMEX or any other bullion trading body or that such bullion is otherwise fit for any purpose), and (iv) remains the subject of a subsisting policy of insurance that covers Brinks' and Via Mats' liability for the loss, damage or destruction of such bullion.

49. The Bullion Custodian has advised each Bullion Class and the Filer that each of Brinks and Via Mat have arranged for sufficient insurance coverage in respect of any of its physical bullion held by the Bullion Custodian through the vault facilities of Brinks or Via Mat. The Filer has discussed the insurance coverage obtained by Brinks and Via Mat with the Bullion Custodian and believes that the insurance coverage obtained by Brinks and Via Mat is appropriate for each Bullion Class.

50. Pursuant to the Custodian Agreement, in safekeeping the property of each Bullion Class, the Custodian is required to exercise (i) the degree of care, diligence and skill that a reasonably prudent person would exercise in the circumstances; or (ii) at least the same degree of care as it exercises with respect to its own property of a similar kind, if this is a higher degree of care than the degree of care referred to in (i). In addition, pursuant to the Custodian Agreement, the Custodian is not entitled to an indemnity from the Bullion Classes in the event the Custodian breaches its standard of care. The Bullion Custodian Agreement includes a similar standard of care in respect of the obligations of the Bullion Custodian and a similar provision in respect of the Bullion Custodian's indemnity. The Bullion Custodian has satisfied itself that the degree of care to which Brinks and Via Mat are subject in respect of the Bullion Sub-Custodian Agreement is no less than the degree of care referred to in (i).

51. The Bullion Custodian Agreement provides that the Bullion Custodian shall, at all times, indemnify and save harmless the Custodian from and against any and all losses, charges, damages, actions, demands, costs, expenses, claims and liabilities (except for indirect, incidental, exemplary, punitive, consequential or special damages) arising from the Bullion Custodian's own negligence or willful misconduct in the performance or non-performance of its duties under the Bullion Custodian Agreement.

52. The Custodian Agreement provides that if the Bullion Classes suffer a loss as a result of any act or omission of the Custodian or of any other agent appointed by the Custodian (rather than appointed by the Filer), including the Bullion Custodian, and if such loss is directly attributable to the failure of such agent to comply with its standard of care in the provision of any service to be provided by it under the Custodian Agreement, then the Custodian shall assume liability for such loss directly, and shall reimburse each Bullion Class accordingly.

53. The Bullion Custodian Agreement provides that if the Custodian suffers a loss as a result of any act or omission of a sub-custodian (including Brinks or Via Mat) or of any other agent appointed by the Bullion Custodian (rather than appointed by the Custodian) and if such loss is directly attributable to the failure of such agent to comply with its standard of care in the provision of any service to be provided by it under the Bullion Custodian Agreement or the applicable Bullion Sub-Custodian Agreement, then the Bullion Custodian shall assume liability for such loss directly (except for indirect, incidental, exemplary, punitive, consequential or special damages) and shall reimburse the Custodian accordingly.

54. The Bullion Classes' auditors will be present during, and will verify, a physical count of all of each Bullion Class' physical bullion, whether held by the Bullion Custodian, Brinks, or Via Mat, at least once every year. Each Bullion Class and its auditors will have the ability, with sufficient advance notice to the Bullion Custodian, who shall make arrangements with Brinks or Via Mat, where required, to attend at the vaults of the Bullion Custodian, Brinks and/or Via Mat as required to verify the bullion held by the Bullion Custodian, Brinks or Via Mat on behalf of a Bullion Class, as applicable.

55. The Bullion Custodian shall, to the best of its ability, monitor the most recent audited financial statements of Brinks and Via Mat or their respective affiliates or subsidiaries, in order to ensure that the shareholders' equity of such entities is sufficient with what the Bullion Custodian believes to be appropriate for an entity acting as custodian of physical bullion and, in any event at sufficient levels in order to meet the Bullion Custodian's own internal requirements as though the Bullion Custodian were seeking to deposit its own physical bullion with such sub-custodians.

56. All bullion purchased by the Bullion Classes will be certified by the relevant vendor as bullion conforming to the good delivery standards of the London Bullion Market Association or another internationally recognized bullion trading body.

Decision

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

The decision of the principal regulator under the Legislation is that the Exemption Sought is granted provided that:

(a) the investment by each Top Fund in the applicable Bottom Fund is in accordance with the fundamental investment objectives of the respective Top Fund;

(b) the simplified prospectus of each Top Fund contains the same risk disclosure as the applicable Bottom Fund;

(c) the investment by the Silver Equities Class in silver (including silver certificates) and/or specified derivatives of which the underlying interest is silver is in accordance with the fundamental investment objectives of the Fund;

(d) the investment by the Resource Class in silver and gold (including silver certificates and permitted gold certificates) and/or specified derivatives of which the underlying interest is gold or silver is in accordance with the fundamental investment objectives of the Fund;

(e) the Manager, on behalf of the Bullion Classes, ensures that any silver certificates purchased by a Bullion Class, represent silver which is:

(i) available for delivery in Canada, free of charge, to or to the order of the holder of the certificate;

(ii) of minimum fineness of 999 parts per 1,000;

(iii) held in Canada;

(iv) in the form of either bars or wafers; and

(v) if not purchased from a bank listed in Schedule I, II or III of the Bank Act (Canada), fully insured against loss and bankruptcy by an insurance company licensed under the laws of Canada or a jurisdiction;

(f) on the date which is the earlier of (i) the date when an amendment to the simplified prospectus of the Resource Class is filed for reasons other than this decision; and (ii) the date on which the renewal simplified prospectus of the Resource Class is receipted, the Investment Strategies section in the Resource Class' simplified prospectus will include the following disclosure:

(i) the Fund may invest in gold and silver when deemed appropriate by the portfolio advisor;

(ii) the Fund has received approval of the Canadian securities regulators to permit the Fund to invest directly in gold, permitted gold certificates, silver, silver certificates and/or specified derivatives of which the underlying interest is gold or silver, up to 10% in total of its net assets taken at the market value at the time of the purchase; and

(iii) the risks section in the Fund's simplified prospectus includes disclosure explaining the risks associated with the Fund being over-weighted in certain industry sectors or asset classes, including the risks of investing directly in gold and silver;

(g) The Investment Strategies section in the Silver Equities Class' simplified prospectus will include the following disclosure:

(i) the Fund may invest in silver when deemed appropriate by the portfolio adviser;

(ii) the Fund has received approval of the Canadian securities regulators to permit the Fund to invest directly in silver, silver certificates and/or specified derivatives of which the underlying interest is silver, up to 20% in total of its net assets taken at the market value at the time of the purchase; and

(iii) the unique risks associated with an investment in the Fund including the risk that direct purchases of silver by the Fund may generate higher transaction and custody costs than other types of investments, which may impact the performance of the Fund;

(h) in respect of the relief granted from the requirements of sections 6.1(2)(b), 6.1(3)(b), 6.2 and 6.3, the Bullion Classes, the Manager, the Custodian and the Bullion Custodian are limited to using Brinks and Via Mat as sub-custodians for the bullion of the Bullion Classes which will be held only in Canada, London or New York; and

(i) in respect of the compliance reports to be prepared by the Custodian pursuant to section 6.7 of NI 81-102, in lieu of including the information required by paragraphs 6.7(1)(a), 6.7(1)(b), 6.7(1)(c), 6.7(2)(b) and 6.7(2)(c) in respect of the Custodian's review of the sub-custodian arrangements involving Brinks and Via Mat, the Custodian shall instead be entitled to rely on a certificate of the Bullion Custodian prepared in respect of the Bullion Custodian's annual review process for Brinks and Via Mat referred to in paragraph 41 above, and whether the Bullion Custodian remains of the view that Brinks and Via Mat continue to be appropriate sub-sub-custodians to hold the Bullion Classes' physical bullion.

"Darren McKall"

Manager, Investment Funds Branch

Ontario Securities Commission