Securities Law & Instruments

Headnote

Mutual Reliance Review System for Exemptive Relief Applications - Relief from theidentical consideration requirement of the Legislation in connection with asecurities-exchange take-over bid - Instead of U.S. target shareholders receivingsecurities as consideration for the target shares held by them, they will receive thecash proceeds from the sale of such securities by a depository.

Applicable Ontario Statutes

Securities Act, R.S.O. 1990 c. S.5, as am., ss. 97(1), 104(2)(c).


IN THE MATTER OF THE SECURITIES LEGISLATION OF ALBERTA, BRITISH COLUMBIA, SASKATCHEWAN,MANITOBA, ONTARIO, QUEBEC, NOVA SCOTIA AND NEWFOUNDLAND

AND

IN THE MATTER OF
THE MUTUAL RELIANCE REVIEW SYSTEM FOR EXEMPTIVE RELIEF APPLICATIONS

AND

IN THE MATTER OF
ENERMARK INCOME FUND

AND

IN THE MATTER OF
PURSUIT RESOURCES CORP.

MRRS DECISION DOCUMENT


1. WHEREAS the local securities regulatory authority or regulator (the "DecisionMaker") in each of Alberta, British Columbia, Saskatchewan, Manitoba, Ontario,Quebec, Nova Scotia and Newfoundland (the "Jurisdictions") has received anapplication from EnerMark Income Fund ("EnerMark" or "the Applicant") for adecision under the securities legislation of the Jurisdictions (the "Legislation")that, in connection with EnerMark's offer (the "Offer") to purchase all of theissued and outstanding common shares (the "Shares") of Pursuit ResourcesCorp. (the "Target"), the requirement contained in the Legislation to offer allholders of the same class of securities identical consideration (the "IdenticalConsideration Requirement") shall not apply to U.S. Shareholders (as definedbelow) who receive the cash proceeds from the sale of the trust units ofEnerMark (the "EnerMark Units") in accordance with the procedure set out inparagraph 3.8 below;

2. AND WHEREAS pursuant to the Mutual Reliance Review System for ExemptiveRelief Applications (the "System"), the Alberta Securities Commission is theprincipal regulator for this application;

3. AND WHEREAS the Applicant has represented to the Decision Makers that:

3.1 the Applicant is a trust organized under the laws of the Province ofAlberta, whose head office and majority of assets are located in theProvince of Alberta. Its EnerMark Trust Units are listed on The TorontoStock Exchange (the "TSE");

3.2 the Target is a public company incorporated under the BusinessCorporations Act (Alberta). Its Shares are listed on the TSE and it is areporting issuer or the equivalent in British Columbia, Alberta,Saskatchewan, Manitoba, and Ontario;

3.3 under the terms of the Offer and at the election of the shareholders of theTarget, the price to be paid to holders of Target is either:

3.3.1 $3.00 per Target Share, subject to a maximum aggregateamount of Cdn. $15,000,000 being paid in cash; or

3.3.2 0.80 of an EnerMark Unit for each Target Share;

3.4 if elections by holders of Target Shares to receive cash considerationexceed $15,000,000 in the aggregate, such holders will receive their prorata share of $15,000,000 with the balance owing to them being paid inEnerMark Units on the basis of 0.80 of an EnerMark Unit per Share;

3.5 at the date of the application, and to the knowledge of the Applicant, afterreasonable inquiry, there were 45 shareholders of the Target resident inthe United States (the "U.S. Shareholders") collectively holdingapproximately 6.99% of the Target Shares;

3.6 the EnerMark Units that may be issued under the Offer to the U.S.Shareholders have not been and will not be registered or otherwisequalified for distribution pursuant to the securities legislation of the UnitedStates. Accordingly, the delivery of EnerMark Units to U.S. Shareholderswithout further action by EnerMark may constitute a violation of the lawsof the United States;

3.7 the Applicant is eligible to use the multijurisdictional disclosure system("MJDS") adopted by the United States; however, upon issuing EnerMarkUnits into the United States, the Applicant would become subject to theUnited States Investment Company Act and would have to comply with itsregistration process and continuous disclosure requirements which wouldbe overly burdensome to the Applicant;

3.8 to the extent that U.S. Shareholders of the Target elect to receive or areallocated EnerMark Units in exchange for their Target Shares, theApplicant proposes to deliver the EnerMark to CIBC Mellon TrustCompany (the "Depositary"), who will then sell the EnerMark Units onbehalf of the U.S. Shareholders and deliver to them their respective prorata share of the proceeds of such sale, less commission and applicablewithholding tax, substantially simultaneously with the delivery to all otherTarget shareholders of the consideration to which such shareholders areentitled pursuant to the Offer;

3.9 at the date of the application, the Target's market capitalizationrepresented approximately 14% of the Applicant's market capitalization;

3.10 the Offer is being made in compliance with the Legislation of theJurisdictions, except to the extent that exemptive relief is granted inrespect of the Identical Consideration Requirement;

4. AND WHEREAS under the System, this MRRS Decision Document evidencesthe decision of each Decision Maker ( collectively, the "Decision");

5. AND WHEREAS each of the Decision Makers is satisfied that the test containedin the Legislation that provides the Decision Maker with the jurisdiction to makethe Decision has been met;

6. THE DECISION of the Decision Makers in the Jurisdictions pursuant to theLegislation is that, in connection with the Offer, EnerMark is exempt from theIdentical Consideration Requirement insofar as U.S. Shareholders who acceptthe Offer may receive, instead of receiving EnerMark Units, cash proceeds fromthe Depositary's sale of the EnerMark Units in accordance with the procedureset out in paragraph 3.8 above.

DATED at Calgary, Alberta this 17th day of March, 2000.

"Glenda A. Campbell", Acting Chair"Eric T. Spink", Vice-Chair