frontier Alt Funds Management Limited and frontier Alt Capital Corporation

Decision

Headnote

MI 11-102 -- exemption from requirement to register as investment fund manager approved to allow transfer of funds to a registered investment fund manager -- Securities Act (Ontario), section 25(4) and section 74.

Applicable Legislative Provisions

Securities Act (Ontario), ss. 25(4), 74.

National Instrument 31-103 Registration Requirements and Exemptions, s. 7.3.

April 1, 2011

IN THE MATTER OF

THE SECURITIES LEGISLATION OF

ONTARIO

(the Jurisdiction)

AND

IN THE MATTER OF

THE PROCESS FOR EXEMPTIVE RELIEF

APPLICATIONS IN MULTIPLE JURISDICTIONS

AND

IN THE MATTER OF

FRONTIERALT FUNDS MANAGEMENT LIMITED

(FFML)

AND

FRONTIERALT CAPITAL CORPORATION

(FCC and, together with FFML, the Filers)

DECISION

Background

The principal regulator in the Jurisdiction has received an application from the Filers for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) for an exemption, pursuant to Section 74(1) of the Securities Act (Ontario) (the OSA), from the requirement in Section 25(4) of the OSA to be registered as an investment fund manager in order for each of FFML and FCC to continue to act as the investment fund manager in respect of the 81-102 Funds (as hereinafter defined) and the Non-81-102 Fund (as hereinafter defined), respectively, until the Effective Date (as hereinafter defined) or Termination Date (as hereinafter defined), as applicable (the Exemption Sought).

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

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

(b) the Filers have 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 of the provinces of Canada.

Interpretation

Terms defined in National Instrument 41-101 Definitions and MI 11-102 have the same meaning if used in this decision, unless otherwise defined.

Representations

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

1. FFML is a corporation incorporated under the Canada Business Corporations Act with its head office in Toronto, Ontario.

2. FFML is the manager and trustee of the frontier Alt Opportunistic Bond Fund (the Bond Fund) and the manager of frontier Alt Resource Capital Class Fund (the Resource Fund and, together with the Bond Fund, the 81-102 Funds).

3. FCC is a corporation incorporated under the Canada Business Corporations Act with its head office in Toronto, Ontario

4. FCC, the sole shareholder of FFML, is the manager and trustee of Global Dividend Fund (the Global Dividend Fund or the Non-81-102 Fund and, together with the 81-102 Funds, the Funds), a TSX-listed closed-end fund.

5. FFML is not in default of securities legislation in any jurisdiction of Canada, other than that it is not registered under applicable securities legislation as an investment fund manager and has, therefore, applied for the Exemption Sought.

6. FCC is not in default of securities legislation in any jurisdiction of Canada, other than that it is not registered under applicable securities legislation as an investment fund manager and has, therefore, applied for the Exemption Sought.

7. The Bond Fund is an open-end investment trust governed by an amended and restated declaration of trust dated as of April 20, 2006, as amended by amendment no. 1 thereto dated February 11, 2008 and amendment no. 2 thereto dated June 10, 2010, under the laws of the province of Ontario.

8. The Resource Fund is a class of shares of frontier Alt Capital Class Fund Limited, a corporation formed under the Business Corporations Act (Ontario) by articles of incorporation dated April 27, 2007, as amended by articles of amendment dated June 6, 2007.

9. The Global Dividend Fund is a closed-end investment fund governed by a trust declaration made December 12, 2006 under the laws of the province of Ontario.

10. Each Fund is a reporting issuer in all of the provinces of Canada and is not in default of securities legislation in any jurisdiction of Canada.

11. As FFML and FCC were each acting as an investment fund manager in respect of the 81-102 Funds and the Non-81-102 Fund, respectively, on the day National Instrument 31-103 Registration Requirements and Exemptions (NI 31-103) came into force, each of FFML and FCC had been relying on the exemption found under Section 16.4 of NI 31-103 (the IFM Registration Exemption) and is not currently registered as an investment fund manager with the OSC (nor with the securities regulatory authority or regulator of any other province or territory of Canada). Each of FFML and FCC is also not registered in any other category of registration under the securities legislation of any province or territory of Canada.

12. Under the terms of the IFM Registration Exemption, each of FFML and FCC was required to submit an application for registration as an investment fund manager with the OSC on or before September 28, 2010. Each of FFML and FCC will not, however, be able to meet several conditions prescribed by NI 31-103 for registration as an investment fund manager.

13. Securities of the 81-102 Funds are currently offered under a combined simplified prospectus and annual information form each dated June 10, 2010, as it may be amended, and prepared in accordance with National Instrument 81-101 Mutual Fund Prospectus Disclosure. The 81-102 Funds are subject to NI 81-102.

14. The Filers and BlackBridge Capital Management Corp. (BlackBridge) have entered into an agreement dated December 27, 2010, pursuant to which BlackBridge will become the trustee and manager of the Bond Fund and the Global Dividend Fund and the manager of the Resource Fund, effective on or about April 30, 2011 (the Effective Date), subject to receipt of all necessary regulatory and securityholder approvals and the satisfaction of all other conditions precedent to the proposed transaction (collectively, the Change of Manager).

15. If the necessary approvals are obtained, the Filers will have no further responsibilities in respect of the Funds after the Effective Date.

16. A press release dated March 4, 2011 has been issued and filed on SEDAR and amendments to the simplified prospectus and annual information form of the Funds and a material change report were filed on March 11, 2011 in connection with the Change of Manager.

17. BlackBridge is a corporation incorporated under the Canada Business Corporations Act with its head office in Toronto, Ontario.

18. BlackBridge is not in default of securities legislation in any jurisdiction of Canada.

19. BlackBridge is registered in Ontario as an investment fund manager and as an exempt market dealer. BlackBridge currently does not act as manager of any investment fund.

20. Mr. Daniel Shapiro of Toronto, Ontario is the sole shareholder, as well as a director and officer, of BlackBridge. His principal occupation is acting as the Chief Executive Officer of BlackBridge.

21. Mr. Darren Latoski of Vancouver, British Columbia and Mr. Michael Drake of Schomberg, Ontario are also directors of BlackBridge.

22. BlackBridge intends to manage and administer the Funds in substantially the same manner as the Filers. There is no intention to change the investment objectives, fees and expenses, portfolio managers, auditor or custodian of the Funds. All material agreements regarding the administration of the Funds will either be assigned to BlackBridge by the Filers or BlackBridge will enter into new agreements as required. In either case, the material terms of the material agreements of the Funds will remain the same.

23. At special meetings of securityholders of the Funds to be held on or about April 27, 2011 and April 28, 2011 (the Special Meetings), the securityholders of the Funds will be asked to approve the Change of Manager to BlackBridge.

24. If the necessary approvals are obtained, the resignation of FFML as trustee and manager of the Bond Fund and as manager of the Resource Fund, and the resignation of FCC as trustee and manager of the Global Dividend Fund, will be effective on the Effective Date. On that date, BlackBridge will assume the roles of trustee and manager of the Bond Fund under the existing declaration of trust and management agreement, respectively, of the Bond Fund, will assume the role of manager of the Resource Fund under the existing management agreement in respect of the Resource Fund and will assume the roles of trustee and manager of the Global Dividend Fund under the existing trust declaration of the Global Dividend Fund.

25. If the necessary approvals are not obtained to change the manager of a Fund to BlackBridge, the Filer that is the manager of the applicable Fund proposes to terminate such Fund, effective on or about May 31, 2011 (the Termination Date).

26. The requested exemption will facilitate an orderly transition of the management of the Funds to a registered investment fund manager that will meet all registration requirements or, if all necessary approvals are not obtained, will permit the Filers to terminate a Fund in compliance with the required securityholder notice requirements of each Fund.

27. The requested exemption will not be detrimental to the protection of investors in the Funds or prejudicial to the public interest.

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:

(a) if regulatory and securityholder approval is obtained to change the manager of all the Funds, this decision will terminate on the day after the Effective Date; and

(b) if regulatory and securityholder approval is not obtained to change the manager of any Fund, this decision will terminate on the day after the Termination Date of such Fund.

"Edward P. Kerwin"
Commissioner
Ontario Securities Commission
 
"Margot C. Howard"
Commissioner
Ontario Securities Commission