MRF 2003 Limited Partnership - MRRS Decision

Headnote

Issuer exempted from interim financial reportingrequirements for first and third quarter of each financial year-- issuer also exempted from requirements to file annual informationforms and management's discussion and analysis -- exemptionterminates upon the occurrence of a material change in the businessaffairs of the Issuer unless the Decision Makers are satisfiedthat the exemption should continue.

Applicable Ontario Statutory Provisions

Securities Act, R.S.O. 1990, c. S.5, as am,ss. 77, 79 and 80(b)(iii).

Applicable Ontario Rules

OSC Rule 51-501 -- AIF and MD&A, (2000)23 OSCB 8365, as am., ss. 1.2(2), 2.1(1), 3.1, 4.1(1), 4.3 and5.1.

OSC Rule 52-501 -- Financial Statements, (2000)23 OSCB 8372, ss. 2.2(2) and 4.1.

IN THE MATTER OF

THE SECURITIES LEGISLATIONOF

BRITISH COLUMBIA, ALBERTA,SASKATCHEWAN,

ONTARIO, NOVA SCOTIA AND NEWFOUNDLAND

AND

IN THE MATTER OF

THE MUTUAL RELIANCE REVIEWSYSTEM

FOR EXEMPTIVE RELIEF APPLICATIONS

AND

IN THE MATTER OF

MRF 2003 LIMITED PARTNERSHIP

MRRS DECISION DOCUMENT

WHEREAS the local securities regulatoryauthority or regulator (the "Decision Maker") in eachof British Columbia, Alberta, Saskatchewan, Ontario, Nova Scotiaand Newfoundland (the "Jurisdictions") has receivedan application from MRF 2003 Limited Partnership (the "Partnership")for:

1. a decision pursuant to the securities legislationof each of the Jurisdictions (the "Legislation")that the requirements contained in the Legislation to fileand send to its securityholders (the "Limited Partners")its interim financial statements for each of the first andthird quarters of each of the Partnership's fiscal years (the"First & Third Quarter Interim Financials"),shall not apply to the Partnership; and

2. in Ontario and Saskatchewan only, a decisionpursuant to the securities legislation of Ontario and Saskatchewanthat the requirements to file and send to the Limited Partners,its:

(a) annual information form (the "AIF");

(b) annual management discussion and analysisof financial condition and results of operations (the "AnnualMD&A"); and

(c) interim management discussion and analysisof financial condition and results of operations (the "InterimMD&A"),

shall not apply to the Partnership.

AND WHEREAS pursuant to the Mutual RelianceReview System for Exemptive Relief Application (the "System),the Ontario Securities Commission is the principal regulatorfor this application.

AND WHEREAS, unless otherwise defined,the terms herein have the meaning set out in National Instrument14-101 Definitions or in Quebec Commission Notice 14-101;

AND WHEREAS the Partnership has representedto the Decision Makers that:

1. The Partnership is a limited partnershipformed pursuant to the Limited Partnerships Act (Ontario)on January 9, 2003.

2. The Partnership was formed to invest incertain common shares ("Flow-Through Shares") ofcompanies involved primarily in oil and gas, mining or renewableenergy exploration and development ("Resource Companies").

3. The Partnership will enter into agreements("Resource Agreements") with Resource Companiesand under the terms of each Resource Agreement, the Partnershipwill subscribe for Flow-Through Shares of the Resource Companyand the Resource Company will incur and renounce to the Partnership,in amounts equal to the subscription price of the Flow-ThroughShares, expenditures in respect of resource exploration anddevelopment which qualify as Canadian exploration expenseor as Canadian development expense which may be renouncedas Canadian exploration expense to the Partnership.

4. On April 29, 2003, the Decision Makers,together with the securities regulatory authority or regulatorfor Manitoba, Quebec, New Brunswick, Prince Edward Islandand the Yukon Territory (in which jurisdictions no legislativerequirement exists to file first and third quarter interimfinancial statements), issued a receipt under the System forthe prospectus of the Partnership dated April 29, 2003 (the"Prospectus") relating to an offering of up to 3,000,000units of the Partnership (the "Partnership Units").

5. The Prospectus contained disclosure thatthe Partnership intends to apply for an order from the DecisionMakers exempting it from the requirements to file and distributefinancial statements of the Partnership in respect of thefirst and third quarters of each fiscal year of the Partnershipand from the requirements to prepare an annual informationform and interim and annual management discussion and analysis.

6. The Partnership Units will not be listedor quoted for trading on any stock exchange or market.

7. At the time of purchase or transfer ofPartnership Units, each purchaser or transferee consents tothe application by the Partnership for an order from the DecisionMakers exempting the Partnership from the requirements tofile and distribute financial statements of the Partnershipin respect of the first and third quarters of each fiscalyear of the Partnership.

8. On or about May 15, 2005, the Partnershipwill be liquidated and the Limited Partners will receive theirpro rata share of the net assets of the Partnership; and itis the current intention of the general partner of the Partnershipto propose prior to the dissolution that the Partnership enterinto an agreement with Middlefield Mutual Funds Limited (the"Mutual Fund"), an open end mutual fund, wherebyassets of the Partnership would be exchanged for shares ofthe Growth Class of the Mutual Fund; and upon dissolution,Limited Partners would then receive their pro rata share ofthe shares of the Growth Class of the Mutual Fund.

9. Since its formation on January 9, 2003,the Partnership's activities primarily included (i) collectingthe subscriptions from the Limited Partners, (ii) investingthe available Partnership funds in Flow-Through Shares ofResource Companies, and (iii) incurring expenses to maintainthe fund.

10. Unless a material change takes place inthe business and affairs of the Partnership, the Limited Partnerswill obtain adequate financial information concerning thePartnership from the semi-annual financial statements andthe annual report containing audited financial statementsof the Partnership together with the auditors' report thereondistributed to the Limited Partners and that the Prospectusand the semi-annual financial statements provide sufficientbackground materials and the explanations necessary for aLimited Partner to understand the Partnership's business,its financial position and its future plans, including dissolutionon May 15, 2005.

11. Given the limited range of business activitiesto be conducted by the Partnership and the nature of the investmentof the Limited Partners in the Partnership, the provisionby the Partnership of the First and Third Quarter InterimFinancials, the AIF, the Annual MD&A and the Interim MD&Awill not be of significant benefit to the Limited Partnersand may impose a material financial burden on the Partnership.

12. It is disclosed in the Prospectus thatthe General Partner will apply on behalf of the Partnershipfor relief from the requirements to send to Limited Partnersthe First and Third Quarter Interim Financials and from therequirements to prepare the AIF, the Annual MD&A and theInterim MD&A.

13. Each of the Limited Partners has, by subscribingfor the units offered by the Partnership in accordance withthe Prospectus, agreed to the irrevocable power of attorneycontained in Article XIX of the Amended and Restated LimitedPartnership Agreement scheduled to the Prospectus and hasthereby consented to the making of this application for theexemption requested herein.

AND WHEREAS under the System, this MRRSDecision Document evidences the decision of each Decision Maker(collectively, the "Decision");

AND WHEREAS each Decision Maker is ofthe opinion that the test contained in the Legislation thatprovides the Decision Maker with the jurisdiction to make theDecision has been met;

THE DECISION of the Decision Makers pursuantto the Legislation is that the requirements contained in theLegislation to file and send to the Limited Partners its First& Third Quarter Interim Financials shall not apply to thePartnership provided that this exemption shall terminate uponthe occurrence of a material change in the affairs of the Partnershipunless the Partnership satisfies the Decision Makers that theexemptions should continue, which satisfaction shall be evidencedin writing.

September 11, 2003.

THE FURTHER DECISION of the securitiesregulatory authority or securities regulator in each of Ontarioand Saskatchewan is that the requirements contained in the legislationof Ontario and Saskatchewan to file and send to its LimitedPartners its AIF, Annual MD&A and Interim MD&A shallnot apply to the Partnership provided that this exemption shallterminate upon the occurrence of a material change in the affairsof the Partnership unless the Partnership satisfies the DecisionMakers that the exemptions should continue, which satisfactionshall be evidenced in writing.

September 11, 2003.

"Cameron McInnis"