Floyd Growth Fund

Headnote

Subsection 74(1) - Trades in securities of a mutual fund exempt from the provisions ofsections 25 and 53 of the Ontario Securities Act to investors who have made andcontinue to maintain an investment in the fund of $150,000 or more. Section 147 -Annual filing of a Form 45-501F1 permitted in respect of such subsequent investments.

Statutes Cited

Securities Act, R.S.O. 1990, c.S-5, as am., ss. 25, 53, 72(1)(d), 72(3), 74(1) and 147.

Rules Cited

Rule 45-501 Exempt Distributions Rule 81-501 Mutual Fund Reinvestment Plans.

UPON the application of R. A. Floyd Capital Management Inc. (the "Manager"), thetrustee, manager and promoter of the Floyd Growth Fund (the "Fund"), to the OntarioSecurities Commission (the "Commission") (i) for a ruling pursuant to subsection 74(1) ofthe Securities Act (Ontario) (the "Act") that subsequent investments in the Fund made byan investor in amounts less than $150,000 be exempted from the provisions of sections25 and 53 of the Act so long as the investor has made and continues to maintain aninvestment in the Fund of $150,000 or more and (ii) for an order pursuant to section 147of the Act that such subsequent trades not be subject to subsection 72(3) of the Actprovided an annual filing of a Form 45-501F1 under Rule 45-50 Exempt Distributions("Rule 45-501") and payment of the applicable filing fees is made in respect of suchsubsequent investments;

AND UPON considering the application and the recommendation of Staff of theCommission;

AND UPON the Manager having represented as follows:

1. The Fund is a mutual fund within the meaning of the Act which is to be establishedas a trust under the laws of Ontario by a declaration of trust to be made by theManager.

2. The Manager is registered as an adviser in the categories of investment counseland portfolio manager and as a dealer in the category of limited market dealer.

3. Units of the Fund are to be sold to clients of the Manager on a continuous basis ineach of the provinces of Canada, except Quebec, pursuant to exemptions from theprospectus and, where applicable, dealer registration requirements of thelegislation of such jurisdictions and, accordingly, the Fund does not intend tobecome a reporting issuer under the Act.

4. In addition to establishing the Fund, and thereby being its sponsor, the Manager willalso act as trustee of the Fund and as its portfolio manager and principal distributor.

5. Following an initial purchase of units of the Fund pursuant to the prospectusexemption provided by clause 72(1)(d) of the Act and Rule 45-501, it is proposedthat a unitholder be permitted to acquire additional units (the "Additional Units") ofthe Fund without being subject to any minimum purchase amount.

6. The distribution of additional units to unitholders pursuant to a mandatoryreinvestment of distributions of income or capital gains will be exempt from therequirements of sections 25 and 53 of the Act pursuant to Rule 81-501 Mutual FundReinvestment Plans.

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

IT IS RULED pursuant to subsection 74(1) of the Act that trades in Additional Unitsof the Fund to a unitholder of the fund in Ontario, as described above, are not subject tosection 25 or 53 of the Act provided that:

(A) at the time of the acquisition of such Additional Units, the unitholder who made theinitial investment of at least $150,000 then owns Units of the Fund having anaggregate acquisition cost or an aggregate net asset value of not less than$150,000; and

(B) at the time of the acquisition of such Additional Units, the Manager is registeredunder the Act as an adviser in the categories of investment counsel and portfoliomanager, and as a dealer in the category of limited market dealer, and

(C) provided that this ruling will terminate 90 days after the publication in final form ofany rule exempting from sections 25 and 53 of the Act distributions by a fundmanager on behalf of a pooled fund of additional securities which applies to tradesof Additional Units of the Fund as described in recital 5 above;

AND UPON the Commission being of the opinion that to do so would not beprejudicial to the public interest.

IT IS ORDERED pursuant to section 147 of the Act that a trade by the Manager inUnits of the Fund is not subject to subsection 72(3) of the Act provided that within 30 daysafter the financial year end of the Fund, the Fund files a report in accordance with Form45-501F1 of Rule 45-501 in respect of trades in Units and Additional Units of the Fundduring such financial year and pays the fee prescribed by such Rule.

February 29^th, 2000.

"Howard I. Wetston"     "Theresa McLeod"