Goodman & Company, Investment Counsel Ltd.

Headnote

National Policy 11-203 Process for Exemption Relief Applications in Multiple Jurisdictions -- relief granted from investment prohibition in subsection 4.1(1) of NI 81-102 to permit purchases of securities under private placement where the issuer is not a reporting issuer in any of the jurisdictions -- relief conditional on the fund complying with subsection 4.1(4)(a) and (d) which include approval by the mutual funds' independent review committee.

Applicable Legislative Provisions

National Instrument 81-102 Mutual Funds, ss. 4.1(1), 19.1.

November 6, 2009

IN THE MATTER OF

THE SECURITIES LEGISLATION OF

ONTARIO

(the Principal Jurisdiction)

AND

IN THE MATTER OF

THE PROCESS FOR EXEMPTIVE RELIEF

APPLICATIONS IN MULTIPLE JURISDICTIONS

AND

IN THE MATTER OF

GOODMAN & COMPANY,

INVESTMENT COUNSEL LTD.

(the Dealer Manager)

DECISION

Background

The Principal Regulator (as defined below) in the Principal Jurisdiction has received an application from the Dealer Manager for a decision under the securities legislation of the Principal Jurisdiction of the Principal Regulator (the "Legislation") for an exemption pursuant to Section 19.1 of National Instrument 81-102 ("NI 81-102") from compliance with Subsection 4.1(1) of NI 81-102 (the "Exemption Sought").

The exemption would enable the Dynamic Precious Metals Fund and the Dynamic Focus + Small Business Fund for which the Dealer Manager acts as manager (together, the "Dealer Managed Funds") to invest in the Special Warrants (as defined below) of Peregrine Metals Ltd. (the "Issuer) during the distribution (the "Distribution Period") and to invest in Securities (as defined below) of the Issuer during the 60-day period (the "60-Day Period") following completion of the Distribution Period (the Distribution Period and the 60-Day Period together, the "Prohibition Period"), notwithstanding that an affiliate of the Dealer Manager is acting in connection with the offering of Special Warrants. The offering is a private placement offering (the "Private Placement") and the Issuer is not a reporting issuer in any of the Jurisdictions (as defined below).

Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):

(a) the Ontario Securities Commission is the principal regulator (the "Principal Regulator") for this application, and

(b) the Dealer Manager has provided notice that Section 4.7(1) of Multilateral Instrument 11-102 Passport System ("MI 11-102") is intended to be relied upon in all other provinces and territories of Canada (collectively with the Principal Jurisdiction, the "Jurisdictions").

Interpretation

Defined terms contained in National Instrument 14-101 -- Definitions and MI 11-102 have the same meanings in this decision ("Decision") unless they are otherwise defined in this Decision.

Representations

This Decision is based on the following facts represented by the Dealer Manager:

1. The Dealer Manager is a "dealer manager" with respect to the Dealer Managed Funds, and the Dealer Managed Funds are each a "dealer managed fund", as such terms are defined in Section 1.1 of NI 81-102.

2. The Dealer Managed Funds are open-ended mutual fund trusts established under the laws of the Province of Ontario. The securities of the Dealer Managed Funds are qualified for distribution in all of the provinces and territories of Canada pursuant to a simplified prospectus that has been prepared and filed in accordance with the applicable securities legislation.

3. The Dealer Manager is a corporation incorporated under the laws of Ontario and holds a registration in the category of portfolio manager in Ontario, British Columbia, Quebec, Alberta, Manitoba, Saskatchewan, Nova Scotia and New Brunswick. The head office of the Dealer Manager is located in Toronto, Ontario.

4. The Private Placement is being marketed on a best efforts basis, subject to certain terms, by a syndicate of agents which we understand will include Dundee Securities Corporation (the "Related Underwriter"), an affiliate of the Dealer Manager, with a 50% interest, and GMP Securities L.P. with a 50% interest (the Related Underwriter and any other underwriter which is now or may become part of the syndicate prior to closing, the "Underwriters").

5. According to the undated term sheet in respect of the Private Placement (the "Term Sheet"), the Private Placement is being made on a best efforts basis for up to 30,000,000 special warrants (each, a "Special Warrant") at a price of $1.00 per Special Warrant (the "Offer Price"), with the total issue amount of $30,000,000. In addition, the Underwriters will be granted an option to increase the issue amount by up to $7,500,000 at any time up to 24 hours prior to the Closing Date.

6. The Underwriters will be paid a cash fee equal to 6.0% of the gross proceeds raised under the Private Placement. In addition, the Issuer will also issue to the Underwriters broker special warrants (the "Broker Special Warrants") which will be exercisable for no additional consideration to acquire that number of broker warrants (the "Broker Warrants") which is equal to 6.0% of the number of Special Warrants sold under the Private Placement. Each Broker Warrant will be exercisable to acquire one common share of the Issuer at a price equal to the Offer Price for a period of 18 months after the Closing Date.

7. Each Special Warrant will be exercisable, without payment of any additional consideration, for one unit of the Issuer (each, a "Unit"), each Unit consisting of one common share of the Issuer (each, a "Unit Share") and one-half of one warrant of the Issuer (each whole warrant, a "Warrant" and together with the Unit Shares and the Special Warrants, the "Securities"). Each Warrant will entitle the holder thereof to purchase one common share of the Issuer at a price and for a period to be determined in the context of the market.

8. The Special Warrants will be automatically exercised on the earlier of: (i) 5:00 p.m. (Toronto time) on the third business day after the date (the "Listing Date") the Common Shares become listed on the Toronto Stock Exchange (the "TSX"); and (ii) 5:00 p.m. (Toronto time) on the date which is four months and one day after the Closing Date. All Special Warrants sold under the Private Placement will only be exercised pursuant to the foregoing automatic exercise mechanisms and will not be exercisable upon any act of the holder thereof. If the Listing Date does not occur by the date which is four months and one day after the Closing Date, each Special Warrant shall be exchangeable for 1.10 Unit Shares (in lieu of one Unit Share) and 0.55 Warrants (in lieu of one-half Warrant), and the Issuer shall continue to use its commercially reasonable best efforts to become listed on the TSX. The Broker Special Warrants will be deemed to be exercised concurrently with the deemed exercise of the Special Warrants.

9. According to the Term Sheet, the net proceeds of the Private Placement will be used to complete a Preliminary Economic Assesment and Preliminary Feasibility Study with respect to a heap leach operation at the Issuer's Altar Copper gold project in Argentia and for general corporate purposes.

10. The Dealer Manager is currently compliant with and acting in reliance on National Instrument 81-107 -- Independent Review Committee for Investment Funds ("NI 81-107") with respect to the Dealer Managed Funds.

11. The respective investment objectives of the Dealer Managed Funds permit them to invest in the Securities.

12. The Dealer Manager may wish to cause the Dealer Managed Funds to invest in the Special Warrants during the Distribution Period and in the Securities during the 60-Day Period.

13. Pursuant to NI 81-107 and to the amendments to NI 81-102 that came into force on November 1, 2006 (the "Amendments"), investments in securities during a Prohibition Period are no longer prohibited under Section 4.1 of 81-102 where, among other things, the distribution is made by a prospectus filed in one or more of the Jurisdictions and the investments have been approved in accordance with NI 81-107.

14. The Amendments, however, do not extend to provide relief for investments in securities during a Prohibition Period where the offering is a private placement. Accordingly, an application for relief was made by the Dealer Manager and relief was granted from the Canadian Securities Administrators ("CSA") on August 24, 2007 (the "Private Placement Relief"). The Private Placement Relief allows certain funds managed by the Dealer Manager to be able to invest in equity securities of an issuer in connection with a private placement during the Prohibition Period on the condition that the issuer is a reporting issuer in one of the Jurisdictions and such investment is made in accordance with NI 81-107.

15. The Private Placement Relief does not apply to the Private Placement as the Issuer is not a reporting issuer in any of the Jurisdictions and the offering of Special Warrants is not being made pursuant to a prospectus. However, the Dealer Manager will comply with paragraphs (a) and (d) of Subsection 4.1(4) of NI 81-102 and with NI 81-107.

Decision

The Principal Regulator is satisfied that the Decision meets the test set out in the Legislation for the Principal Regulator to make the Decision.

The Decision of the Principal Regulator under the Legislation is that the Exemption Sought is granted provided that the following condition is satisfied:

• At the time of purchase by the Dealer Managed Funds during the Prohibition Period for the Private Placement, the Dealer Managed Funds have an independent review committee ("IRC") that complies with NI 81-107 and the IRC of the Dealer Managed Funds will have approved the investment in accordance with each of Subsection 4.1(4)(a) of NI 81-102 and NI 81-107. Each Dealer Managed Fund will also comply with paragraph (d) of Subsection 4.1(4) of NI 81-102.