Goodman & Company, Investment Counsel Ltd. - MRRS Decision

Headnote

Mutual Reliance Review System for Exemptive Relief Applications -- Exemption was granted from section 227 of the Ontario Regulation, pursuant to section 233 of the Regulation, and its equivalent in the other jurisdictions, to permit an adviser to dealer managed mutual funds to invest in a connected issuer, subject to an independent review committee.

Applicable Provision

General Regulation, R.R.O. 1990, Reg. 1015, as am., ss. 227, 233.

April 16, 2007

IN THE MATTER OF

THE SECURITIES LEGISLATION OF

ONTARIO, NOVA SCOTIA, AND NEWFOUNDLAND

AND LABRADOR

(the Jurisdictions)

AND

IN THE MATTER OF

THE MUTUAL RELIANCE REVIEW SYSTEM (MRRS)

FOR EXEMPTIVE RELIEF APPLICATIONS

AND

GOODMAN & COMPANY, INVESTMENT COUNSEL LTD.

(the Applicant or Dealer Manager)

MRRS DECISION DOCUMENT

Background

The local securities regulatory authority or regulator (the Decision Makers) in each of the Jurisdictions has received an application from the Applicant, the manager or portfolio adviser or both of the mutual funds named in Appendix A (the Dealer Managed Funds) for a decision from each of the Decision Makers under section 233 of General Regulation, R.R.O. 1990, Reg. 1015, as amended (the Regulation), in Ontario and the equivalent provision in the Jurisdictions of the other Decision Makers (together with the Regulation, the Legislation), as set out in Appendix B, for an exemption from complying with Section 227 of the Regulation and the equivalent provisions in the securities legislation of the Jurisdictions of the other Decision Makers, as set out in Appendix B (collectively referred to as the Adviser Restriction), to enable the Dealer Manager to act as adviser to the Dealer Managed Funds in respect of ordinary shares (the Ordinary Shares) of Mirabela Nickel Limited (the Issuer), during the course of the distribution (the Distribution) of the Ordinary Shares offered pursuant to long form prospectus filed in each of the provinces, except Québec, despite the fact that the Issuer may be a connected issuer of the Dealer Manager during the course of the Distribution (the Requested Relief).

Under the Mutual Reliance Review System for Exemptive Relief Applications:

(a) the Ontario Securities Commission (the OSC) is the principal regulator for the Requested Relief, and

(b) this MRRS decision document evidences the decision of each of the Decision Makers.

Interpretation

Defined terms contained in National Instrument 14-101 -- Definitions have the same meanings in this decision unless they are defined in this decision.

Representations

This decision is based on the following facts represented by the Applicant:

1. The Dealer Manager is a "dealer manager" with respect to each Dealer Managed Fund, and each Dealer Managed Fund is a "dealer managed mutual fund", as such terms are defined in section 1.1 of National Instrument 81-102 -- Mutual Fund Distributions.

2. The head office of the Dealer Manager is in Toronto, Ontario.

3. The securities of the Dealer Managed Funds are qualified for distribution in one or more of the provinces and territories of Canada pursuant to simplified prospectuses that have been prepared and filed in accordance with their respective securities legislation.

4. A preliminary long form prospectus (the Preliminary Prospectus) of the Issuer dated March 26, 2007, has been filed with the Decision Makers in each of the provinces of Canada (except Québec) for which an MRRS decision document evidencing receipt by such Decision Makers was issued on March 28, 2007.

5. According to the Preliminary Prospectus, the Offering will be underwritten, subject to certain terms, by a syndicate that includes, among others, Dundee Securities Corporation (the Related Underwriter), an affiliate of the Dealer Manager (the Related Underwriter and any other underwriters which are now or may become part of the syndicate, the Underwriters).

6. As disclosed in the Preliminary Prospectus, the Issuer is a mineral exploration company incorporated under the laws of Australia and listed on the Toronto Stock Exchange (the TSX) and the Australian Securities Exchange. The Issuer has a portfolio of prospective nickel and other base metal projects in Brazil and its principal asset is the Santa Rita disseminated nickel sulphide deposit in Bahia State, Brazil.

7. As described in the Issuer's undated term sheet in respect of the Offering (the Term Sheet), the closing date for the Offering is expected to occur on or before April 26, 2007 (the Closing Date) or such other date as may be agreed to by the Issuer and Sprott Securities Inc., one of the Underwriters.

8. As described in the Term Sheet, the Offering is expected to be comprised of Ordinary Shares with aggregate gross proceeds of approximately CAD$105,000,000. The Issuer will grant the Underwriters an option, exercisable for a period of up to 30 days following the Closing Date to purchase up to an additional 15% of the issue to cover over-allotments, if any (the Over-Allotment Option).

9. As described in the Term Sheet, CVRD Inco Limited has a pre-emptive right (the Inco Pre-Emptive Right) to participate in up to 10% of the Offering, including any Ordinary Shares issued pursuant to the Over-Allotment Option, and such Inco Pre-Emptive Right may increase the Offering by $10,500,000 (or $13,282,500 assuming full exercise of the Over-Allotment Option).

10. As disclosed in the Term Sheet, the proceeds of the Offering will be used by the Issuer to fund instalments due under land purchase agreements, to finance its existing drilling and exploration programs at the Santa Rita, Peri Peri and Palestina projects and if the bankable feasibility study warrants it, to finance a portion of the capital costs of the Santa Rita project.

11. As further disclosed in the Term Sheet, the Issuer will apply to list the Ordinary Shares distributed under the Offering, on the TSX. The Issuer's outstanding Ordinary Shares are listed on the TSX under the symbol MNB.

12. The Term Sheet does not disclose that the Issuer is a "related issuer" as defined in National Instrument 33-105 -- Underwriting Conflicts (NI 33-105).

13. As described in the Preliminary Prospectus, the Issuer may be a "connected issuer" of the Dealer Manager, as defined in NI 33-105, as the Dealer Manager, directors, officers, employees and affiliates of the Dealer Manager and associates of each of them own or control, as of March 23, 2007, 13.5% of the issued and outstanding Ordinary Shares of the Issuer and 12.8% of the Ordinary Shares on a fully diluted basis.

14. Despite the affiliation between the Dealer Manager and the Related Underwriter, the Dealer Manager operates independently of the Related Underwriter. In particular, the investment banking and related dealer activities of the Related Underwriter and the investment portfolio management activities of the Dealer Manager are separated by "ethical" walls. Accordingly, no information flows from one to the other concerning their respective business operations or activities generally, except in the following or similar circumstances:

(a) in respect of compliance matters (for example, the Dealer Manager and the Related Underwriter may communicate to enable the Dealer Manager to maintain up to date restricted-issuer lists to ensure that the Dealer Manager complies with applicable securities laws); and

(b) the Dealer Manager and the Related Underwriter may share general market information such as discussion on general economic conditions, bank rates, etc.

15. The Dealer Managed Funds are not required or obligated to purchase any Ordinary Shares during the Distribution.

16. The Dealer Manager may cause the Dealer Managed Funds to invest in the Ordinary Shares during the Distribution. Any purchase of Ordinary Shares by the Dealer Managed Funds will be consistent with the investment objectives of that Dealer Managed Fund and represent the business judgment of the Dealer Manager uninfluenced by considerations other than the best interests of the Dealer Managed Funds or in fact be in the best interests of the Dealer Managed Funds.

17. To the extent that the same portfolio manager or team of portfolio managers of the Dealer Manager manages two or more Dealer Managed Funds and other client accounts that are managed on a discretionary basis (the Managed Accounts), the Ordinary Shares purchased for them will be allocated:

(a) in accordance with the allocation factors or criteria stated in the written policies or procedures put in place by the Dealer Manager for the Dealer Managed Funds and Managed Accounts, and

(b) taking into account the amount of cash available to each Dealer Managed Fund for investment.

18. Except as described above, the Dealer Manager has not been involved in the work of the Related Underwriter and the Related Underwriter has not been and will not be involved in the decisions of the Dealer Manager as to whether the Dealer Managed Funds will purchase Ordinary Shares during the Distribution.

19. There will be an independent committee (the Independent Committee) appointed in respect of each Dealer Managed Fund to review such Dealer Managed Fund's investments in Ordinary Shares during the Distribution.

20. The Independent Committee will have at least three members and every member must be independent. A member of the Independent Committee is not independent if the member has a direct or indirect material relationship with the Dealer Manager, the Dealer Managed Funds, or any affiliate or associate thereof. For the purpose of this Decision, a material relationship means a relationship which could, in the view of a reasonable person, reasonably interfere with the exercise of the member's independent judgment regarding conflicts of interest facing the Dealer Manager.

21. The members of the Independent Committee will exercise their powers and discharge their duties honestly, in good faith, and in the best interests of investors in their respective Dealer Managed Funds and, in so doing, exercise the degree of care, diligence and skill that a reasonably prudent person would exercise in the circumstances.

22. The Dealer Manager, in respect of the Dealer Managed Funds, will notify a member of staff in the Investment Funds Branch of the Ontario Securities Commission, in writing of any SEDAR Report (as defined below) filed on SEDAR, as soon as practicable after the filing of such a report, and the notice shall include the SEDAR project number of the SEDAR Report and the date on which it was filed.

Decision

Each of the Decision Makers is satisfied that the test contained in the Legislation that provides the Decision Maker with the jurisdiction to make the decision has been met.

The decision of the Decision Makers under the Legislation is that the Requested Relief is granted, notwithstanding that the Issuer may be a connected issuer of the Dealer Manager or that the Related Underwriter acts or has acted as underwriter in the Offering, provided that the following conditions are satisfied:

I. At the time of each purchase of Securities (a Purchase) by a Dealer Managed Fund pursuant to this Decision, the following conditions are satisfied:

(a) the Purchase

(i) represents the business judgment of the Dealer Manager uninfluenced by considerations other than the best interests of the Dealer Managed Fund, or

(ii) is, in fact, in the best interests of the Dealer Managed Fund;

(b) the Purchase is consistent with, or is necessary to meet, the investment objective of the Dealer Managed Fund as disclosed in its simplified prospectus; and

(c) the Dealer Managed Fund does not place the order to purchase, on a principal or agency basis, with its Related Underwriter.

II. Prior to effecting any Purchase pursuant to this Decision, the Dealer Managed Fund has in place written policies or procedures to ensure that,

(a) there is compliance with the conditions of this Decision; and

(b) in connection with any Purchase,

(i) there are stated factors or criteria for allocating the Ordinary Shares purchased for two or more Dealer Managed Funds and other Managed Accounts, and

(ii) there is full documentation of the reasons for any allocation to a Dealer Managed Fund or Managed Account that departs from the stated allocation factors or criteria.

III. The Dealer Manager does not accept solicitation by the Related Underwriter for the Purchase of Ordinary Shares for the Dealer Managed Funds.

IV. The Related Underwriter does not purchase Ordinary Shares in the Offering for its own account except Ordinary Shares sold by the Related Underwriter on closing.

V. Each Dealer Managed Fund has an Independent Committee to review the Dealer Managed Fund's investments in the Ordinary Shares during the Distribution.

VI. The Independent Committee has a written mandate describing its duties and standard of care which, at a minimum, sets out the applicable conditions of this Decision.

VII. The members of the Independent Committee exercise their powers and discharge their duties honestly, in good faith, and in the best interests of investors in the Dealer Managed Funds and, in so doing, exercise the degree of care, diligence and skill that a reasonably prudent person would exercise in the circumstances.

VIII. The Dealer Managed Funds do not relieve the members of the Independent Committee from liability for loss that arises out of a failure to satisfy the standard of care set out in paragraph VII above.

IX. The Dealer Managed Funds do not incur the cost of any portion of liability insurance that insures a member of the Independent Committee for a liability for loss that arises out of a failure to satisfy the standard of care set out in paragraph VII above.

X. The cost of any indemnification or insurance coverage paid for by the Dealer Manager, any portfolio manager of the Dealer Managed Funds, or any associate or affiliate of the Dealer Manager or any portfolio manager of the Dealer Managed Funds to indemnify or insure the members of the Independent Committee in respect of a loss that arises out of a failure to satisfy the standard of care set out in paragraph VII above is not paid either directly or indirectly by the Dealer Managed Funds.

XI. The Dealer Manager files a certified report on SEDAR (the SEDAR Report) in respect of each Dealer Managed Fund, no later than 90 days after the end of the Distribution, that contains a certification by the Dealer Manager that contains:

(a) the following particulars of each Purchase:

(i) the number of Ordinary Shares purchased by the Dealer Managed Fund;

(ii) the date of the Purchase and purchase price;

(iii) whether it is known whether any Underwriter or syndicate member has engaged in market stabilization activities in respect of the Ordinary Shares;

(iv) if the Ordinary Shares were purchased for two or more Dealer Managed Funds and other Managed Accounts of the Dealer Manager, the aggregate amount so purchased and the percentage of such aggregate amount that was allocated to each Dealer Managed Fund; and

(v) the dealer from whom the Dealer Managed Fund purchased the Ordinary Shares and the fees or commissions, if any, paid by the Dealer Managed Fund in respect of such Purchase;

(b) a certification by the Dealer Manager that the Purchase:

(i) was made free from any influence by the Related Underwriter or any affiliate or associate thereof and without taking into account any consideration relevant to the Related Underwriter or any associate or affiliate thereof; and

(ii) represented the business judgment of the Dealer Manager uninfluenced by considerations other than the best interest of the Dealer Managed Funds, or

(iii) was, in fact, in the best interests of the Dealer Managed Fund;

(c) confirmation of the existence of the Independent Committee to review the Purchase of the Ordinary Shares by the Dealer Managed Funds, the names of the members of the Independent Committee, the fact that they meet the independence requirements set forth in this Decision, and whether and how they were compensated for their review; and

(d) a certification by each member of the Independent Committee that after reasonable inquiry the member formed the opinion that the policies and procedures referred to in Condition II(a) above are adequate and effective to ensure compliance with this Decision and that the decision made on behalf of each Dealer Managed Fund by the Dealer Manager to purchase Ordinary Shares for the Dealer Managed Fund and each Purchase by the Dealer Managed Fund:

(i) was made in compliance with the conditions of this Decision;

(ii) was made by the Dealer Manager free from any influence by the Related Underwriter or any affiliate or associate thereof and without taking into account any consideration relevant to the Related Underwriter or any associate or affiliate thereof; and

(iii) represented the business judgment of the Dealer Manager uninfluenced by considerations other than the best interests of the Dealer Managed Funds, or

(iv) was, in fact, in the best interests of the Dealer Managed Funds.

XII. The Independent Committee advises the Decision Makers in writing of:

(a) any determination by it that the condition set out in paragraph XI(d) has not been satisfied with respect to any Purchase of the Ordinary Shares by a Dealer Managed Fund;

(b) any determination by it that any other condition of this Decision has not been satisfied;

(c) any action it has taken or proposes to take following the determinations referred to above; and

(d) any action taken, or proposed to be taken, by the Dealer Manager or a portfolio manager of the Dealer Managed Funds, in response to the determinations referred to above.

XIII. The Dealer Manager:

(a) expresses an interest to purchase on behalf of the Dealer Managed Funds and Managed Accounts a fixed number of Ordinary Shares (the Fixed Number) to an Underwriter other than its Related Underwriter;

(b) agrees to purchase the Fixed Number or such lesser amount as has been allocated to the Dealer Manager no more than five (5) business days after the closing of the Offering;

(c) does not place an order with an Underwriter of the Offering to purchase an additional number of Ordinary Shares under the Offering prior to the completion of the Distribution, provided that if the Dealer Manager was allocated less than the Fixed Number at the time of the closing of the Offering for the purposes of the closing, the Dealer Manager may place an additional order for such number of additional Ordinary Shares equal to the difference between the Fixed Number and the number of Ordinary Shares allotted to the Dealer Manager at the time of the closing of the Offering in the event the Underwriters exercise the Over-Allotment Option; and

(d) does not sell Ordinary Shares purchased by the Dealer Manager under the Offering, prior to the listing of the Ordinary Shares on the TSX.

APPENDIX "A"

THE MUTUAL FUNDS

Dynamic Funds

DMP Resource Class

Dynamic Power Balanced Fund

Dynamic Power Canadian Growth Class

Dynamic Power Canadian Growth Fund

Dynamic Precious Metals Fund

Marquis Investment Program

Marquis Enhanced Canadian Equity Pool

APPENDIX "B"

The Adviser Restriction