Imperial Capital, LLC

Headnote

Multilateral Instrument 11-102, section 4.7(1) -- Exemption granted from requirement to file Form 31-103 F1 -- U.S. broker/dealer subject to U.S. reporting requirements registered as restricted dealer and thus required to file Form 31-103 F1 pursuant to section 12.1 of National Instrument 31-103 -- Conditions concerning filing of SEC Form X-17a-5 (FOCUS Report) in lieu of Form 31-103F1 and notification of any issues.

Applicable Legislative Provisions

Multilateral Instrument 11-102 Passport System, s. 4.7(1).

National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations, ss. 12.1, 15.1.

October 3, 2012

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

IMPERIAL CAPITAL, LLC

(the Filer)

DECISION

Background

The principal regulator in the Jurisdiction has received an application from the Filer (the Application) for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) exempting the Filer from:

(i) the requirements of section 12.1 -- Capital Requirements ("Section 12.1") of National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations ("NI 31-103") that the Filer maintains excess working capital calculated using Form 31-103F1 Calculation of Excess Working Capital ("Form 31-103F1"), and

(ii) the requirements of section 12.12 Delivering financial information -- dealer and section 12.13 Delivering financial information -- adviser of NI 31-103 as applicable, that the Filer deliver a completed Form 31-103F1showing the calculation of its excess working capital as at the end of the financial year and as at the end of the immediately preceding financial year,

so long as the Filer calculates excess net capital using the U.S. Securities and Exchange Commission ("SEC") Form X-17a-5 (the "FOCUS Report") and delivers the FOCUS Report in lieu of delivering Form 31-103F1 as required by NI 31-103 (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 Filer 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 each of the other provinces of Canada (the "Passport Jurisdictions" and together with the Jurisdiction, the Jurisdictions).

Interpretation

Terms defined in National Instrument 14-101 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 Filer:

1. The Filer is a limited liability company formed under the laws of the State of Delaware. The head office of the Filer is located in Los Angeles, California, United States of America.

2. The Filer is registered as a broker-dealer with the SEC and is a member of the Financial Industry Regulatory Authority ("FINRA"). The Filer is a member of the NASDAQ Stock Market, NYSE Arca, Inc., BATS Z-Exchange, Inc., EDGA Exchange, Inc., EDGX Exchange, Inc.

3. The Filer is registered, or has applied to be registered, as a restricted dealer ("RD") in each of the Canadian provinces of British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Quebec, Nova Scotia, New Brunswick, Newfoundland and Labrador and Prince Edward Island.

4. Under NI 31-103,the Filer is required to calculate its excess working capital using Form 31-103F1.

5. The Filer is subject to regulatory capital requirements under the Securities Exchange Act of 1934, specifically Rule 15c3-1, that are designed to meet regulatory protections that are substantially similar to the protections provided by the regulations regarding excess working capital to which dealer members of the Investment Industry Regulatory Organization of Canada (IIROC) are subject, and the Filer is in compliance in all material respects with Rule 15c3-1. The SEC and FINRA have the responsibility for ensuring that the Filer operates in compliance with SEC Rule 15c3-1.

6. The Filer is required to prepare and file a FOCUS Report with United States regulators, which is the financial and operational report containing a net capital calculation.

7. The FOCUS Report provides a more comprehensive description of the business activities of the Filer, and more accurately reflects those activities including client lending activity, than would be provided by Form 31-103F1, and the minimum SEC Rule 15c3-1 requirements applicable to the Filer are a substantially greater amount than the minimum requirement of NI 31-103.

8. The Filer will, in the event that it provides a guarantee of any debt of a third party, deduct the total amount of the guarantee from its excess net capital on the FOCUS Report, consistent with the required treatment of such a guarantee under Form 31-103F1.

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 so long as:

(a) the Filer is registered, and in good standing, under the securities legislation of the United States in a category of registration that permits it to carry on the activities in the United States that registration as an investment dealer would permit it to carry on in the Jurisdictions;

(b) by virtue of the registration referred to in paragraph (a), including required membership in one or more self-regulatory organizations, the Filer is subject to SEC Rule 15c3-1 and SEC Rule 17a-5 Reports to be Made by Certain Brokers and Dealers ("SEC Rule 17a-5"); and that the protections provided by SEC Rule 15c3-1and SEC Rule 17a-5 in respect of maintaining excess net capital are substantially similar to the protections provided by the capital requirements of IIROC that would be applicable to the Filer respectively if they were registered under the Legislation as an investment dealer and were a member of IIROC;

(c) the Filer delivers to the principal regulator no later than the 90th day after the end of its respective financial year its FOCUS Report as filed with the SEC and FINRA;

(d) the Filer prepares the FOCUS Report on an unconsolidated basis;

(e) the Filer gives written notice to the principal regulator immediately if at any time its excess net capital as reported in box 3920 of its most recently filed FOCUS Report, is less than zero, and ensure that such capital is not less than zero for 2 consecutive days;

(f) the Filer gives prompt written notice to the principal regulator of any significant issues arising from analysis by U.S. securities regulators of the FOCUS Report filed by the Filer pursuant to SEC and FINRA requirements;

(g) the Filer provides the principal regulator with at least five days written notice prior to any repayment of subordinated intercompany debt or termination of a subordination agreement with respect to intercompany debt; and

(h) the Filer is registered as a restricted dealer.