R.S.O. 1990, c. S.5, AS AMENDED
IN THE MATTER OF
MARK BONHAM, STRATEGICNOVA FUNDS
MANAGEMENT INC. AND BONHAM & CO. INC.
WHEREAS on November 6th, 2000, the Ontario Securities Commission (the "Commission") issued an Amended Notice of Hearing pursuant to section 127(1) of the Securities Act, R.S.O. 1990, c. S.5, as amended (the "Act") in respect of Mark Bonham, StrategicNova Funds Management Inc. ("StrategicNova") and Bonham & Co. Inc.;
AND WHEREAS StrategicNova entered into a Settlement Agreement dated November 6th, 2000 (the "Settlement Agreement") in which it agreed to a proposed settlement of the proceedings, subject to the approval of the Commission;
AND UPON reviewing the Settlement Agreement and the statement of allegations of staff of the Commission, and upon hearing submissions from counsel for StrategicNova and from Staff of the Commission;
AND WHEREAS the Commission is of the opinion that it is in the public interest to make this Order;
IT IS ORDERED THAT:
1.The Settlement Agreement dated November 6th, 2000 in respect of StrategicNova, attached to this Order is hereby approved;
2.StrategicNova will, on or before December 31st, 2000, make a payment of $10,000.00 to the Commission as its contribution to the costs of the investigation and hearing of this matter;
3.StrategicNova will submit to a review of the valuation practices and procedures involving the Strategic Value Fund, Canadian Equity Value Fundand Dividend Fund, such review to be performed by a third party (the "expert") approved by Staff at StrategicNova’s expense and will implement such reasonable changes as are recommended by the expert in a report within reasonable time frames set out by the expert after consultation with StrategicNova. StrategicNova will provide Staff with a copy of the report and the recommendations of the expert and with progress reports concerning the implementation of the expert’s recommendations;
4.StrategicNova will submit to a review of the manual prices used in the calculation of net asset value per share for any day during the period July 1, 1998 to September 30, 2000 inclusive on which manual pricing occurred in any relevant mutual fund. Such review is to be carried out by the expert at StrategicNova’s expense to determine whether the manual pricing activity that forms the basis of this proceeding was repeated during this time period. As part of this review StrategicNova agrees to produce to the expert at StrategicNova’s expense, all of the manual pricing sheets for this period. If it is determined that SVC or StrategicNova engaged in material and improper manual pricing activity during this period then the expert will determine the impact, if any, on SVC or StrategicNova’s clients as a result of such manual pricing. StrategicNova will provide Staff with a copy of the review carried out by the expert;
5.If, as a result of the reviews set out in paragraphs (d) and (e), it is determined that the fund values and/or published results, communicated either to the public or to individual clients, were materially misstated, then StrategicNova will restate such fund values and make any required restitution to any relevant mutual fund; and
6.StrategicNova is hereby reprimanded.
November , 2000.