Securities Law & Instruments


Issuer exempted from interim financial reportingrequirements for first and third quarters for each financialyear. Exemption terminates upon the occurrence of a materialchange in the business affairs of the Issuer unless the DecisionMakers are satisfied that the exemption should continue.

Applicable Ontario Statutes

Securities Act, R.S.O. 1990, c. S.5, as amended,ss. 77(1), 79, 80(b)(iii).














WHEREAS the local securities regulatoryauthority or regulator (the "Decision Maker")in each of British Columbia, Alberta, Saskatchewan, Ontario,and Nova Scotia (the "Jurisdictions") has receivedan application from Stone 2003 Flow-Through Limited Partnership(the "Partnership") for a decision pursuantto the securities legislation of each of the Jurisdictions (the"Legislation") that the requirements containedin the Legislation that the Partnership file with the DecisionMakers and send to its security holders (the "LimitedPartners") the Partnership's interim financial statementsfor each of the first and third quarters of each financial yearof the Partnership (the "First & Third Quarter InterimFinancials"), shall not apply to the Partnership.

AND WHEREAS under 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;

AND WHEREAS the Partnership has representedto the Decision Makers that:

1. The Partnership is a limited partnershipformed pursuant to the Limited Partnership Act (Ontario)on May 28, 2003.

2. The Partnership has a general partner (the"General Partner") that is responsible forthe management of the Partnership in accordance with the termsand conditions of an amended and restated limited partnershipagreement dated August 18, 2003 (the "PartnershipAgreement").

3. The Partnership was formed to invest incertain common shares ("Flow-Through Shares")of companies involved principally in mineral or oil and gasexploration and development ("Resource Companies").

4. The Partnership will enter into agreements("Flow-Through Agreements") with ResourceCompanies and under the terms of each Flow-Through Agreement,the Partnership will subscribe for Flow-Through Shares ofthe Resource Company and the Resource Company will incur andrenounce to the Partnership, in amounts equal to the subscriptionprice of the Flow-Through Shares, expenditures in respectof resource exploration and development which qualify as CanadianExploration Expense (as such term is defined in the IncomeTax Act (Canada).

5. On August 18, 2003, the Decision Makers,together with the securities regulatory authority or regulatorfor Manitoba, New Brunswick, and the Northwest Territories(jurisdictions in which no legislative requirement existsto file first and third quarter interim financial statements),issued a final receipt under the System for the (final) prospectusof the Partnership dated August 18, 2003 (the "Prospectus")relating to a maximum offering of up to 800,000 units of thePartnership (the "Partnership Units").

6. The Prospectus contains 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 Partnership.

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

8. 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.

9. On or about September 30, 2005, the Partnershipwill be liquidated and the Limited Partners will receive theirpro rata share of the net assets of the Partnership.It is the current intention of the General Partner to proposeprior to the dissolution that the Partnership exchange itsassets for securities of a mutual fund corporation or otherappropriate investment vehicle, and distribute such securitiesto the Limited Partners and General Partner on a tax effectivebasis.

10. Since its formation on May 28, 2003, thePartnership'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.

11. 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 and annual financial statements providesufficient background materials and the explanations necessaryfor a Limited Partner to understand the Partnership's business,its financial position and its future plans, including dissolutionon or about September 30, 2005.

12. 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 & Third Quarter InterimFinancials will not be of significant benefit to the LimitedPartners and may impose a material financial burden on thePartnership.

13. Each of the Limited Partners has, by subscribingfor the Partnership Units in accordance with the Prospectus,agreed to the irrevocable power of attorney contained in ArticleXIX of the Partnership Agreement scheduled to the Prospectusand has thereby, in effect, consented to the making of thisapplication for the exemption 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 underthe Legislation is that the requirements contained in the Legislationto file and send to the Limited Partners its First & ThirdQuarter Interim Financials shall not apply to the Partnershipprovided that this exemption shall terminate upon the occurrenceof a material change in the affairs of the Partnership unlessthe Partnership satisfies the Decision Makers that the exemptionsshould continue, which satisfaction shall be evidenced in writing.

October 20, 2003.

"Robert L. Shirriff"
"Robert W. Davis"