Securities Law & Instruments

August 27, 2004

McMillan Binch LLP
BCE Place
Suite 4400
Bay Wellington Tower
Toronto, Ontario
M5J 2T3

Attention: Cindy W. Wan

Dear Sirs/Mesdames:

Re:
Tremont Capital Management, Corp.
Application for Exemptive Relief under
OSC Rule 13-502 Fees (the "Rule" or "Rule 13-502")

By letter dated August 20, 2004 (the "Application"), you applied on behalf of Tremont Capital Management, Corp. ("Tremont"), the manager of the Tremont Core Diversified Fund (the "Existing Fund") and any similar trust managed by Tremont from time to time (collectively with the Existing Fund, the "Funds"), to the Ontario Securities Commission (the "Commission") under section 147 of the Securities Act (Ontario) (the "Act") for relief from subsections 77(2) and 78(1) of the Act, which requires every mutual fund in Ontario to file interim and comparative annual financial statements (the "Financial Statements") with the Commission.

By same date and cover, you additionally applied to the Commission on behalf of Tremont, the manager of the Existing Fund, for an exemption, pursuant to section 6.1 of Rule 13-502, from the requirement to pay an activity fee of $5,500 in connection with the Application in accordance with item F.1. of Appendix C of the Rule, on the condition that fees be paid on the basis that the Application be treated as an application for other regulatory relief under item F. 3. of Appendix C of Rule 13-502, and from the requirement to pay an activity fee of $1,500 in connection with the latter relief (the "Fees Exemption").

Item F. of Appendix C of Rule 13-502 specifies the activity fee applicable for applications for discretionary relief. Item F. 1. specifies that applications under section 147 of the Act pay an activity fee of $5,500, whereas item F. 3. specifies that applications for other regulatory relief pay an activity fee of $1,500.

From our review of the Application and other information communicated to staff, we understand the relevant facts and representations to be as follows:

1. Tremont is a corporation existing under the laws of New Brunswick with its head office in Toronto, Ontario. Tremont is, or will be, the manager of the Funds.

2. Tremont is registered with the Commission as dealer in the category of limited market dealer, as an adviser in the categories of investment counsel and portfolio manager and as a commodity trading manager.

3. The Existing Fund is an investment trust established under the laws of the Province of Ontario. The Existing Fund is governed by a trust agreement, as amended and restated from time to time, between Tremont as manager and The Royal Trust Company as trustee. The Funds are not and will not be reporting issuers in any province or territory of Canada. Units of the Funds are, or will be, distributed in each of the provinces and territories of Canada without a prospectus pursuant to exemptions from the registration and prospectus delivery requirements of applicable securities legislation.

4. The Existing Fund's fiscal year will end on December 31st of each year.

5. The Funds fit within the definition of "mutual fund in Ontario" in subsection 1(1) of the Act and are thus required to file Financial Statements with the Commission under subsections 77(2) and 78(1) of the Act.

6. Paragraph 2.1(1)1. of National Instrument 13-101 - System for Electronic Document Analysis and Retrieval (SEDAR) requires that every issuer required to file a document under securities legislation make its filing through SEDAR. The Financial Statements filed with the Commission thus become publicly available.

7. In the Application, Tremont and the Funds have requested under section 147 of the Act relief from filing the Financial Statements with the Commission. The activity fee associated with the Application is $5,500 in accordance with item F. 1. of Appendix C of Rule 13-502.

8. If Tremont and the Funds had, as an alternative to the Application, sought an exemption from the requirement to file the Financial Statements via SEDAR, the activity fee for that application would be $1,500 in accordance with item F. 3. of Appendix C of Rule 13-502.

9. If the Funds were reporting issuers seeking the same relief as requested in the Application, such relief could be sought under section 80 of the Act, rather than under section 147 of the Act, and the activity fee for that application would be $1,500 in accordance with item F. 3. of Appendix C of Rule 13-502.

Decision

This letter confirms that, based on the information provided in the Application, other communications to staff, and the facts and representations above, and for the purposes described in the Application, the Decision Maker hereby exempts Tremont and the Funds from:

(i) paying an activity fee of $5,500 in connection with the Application, provided that Tremont and the Funds pay an activity fee on the basis that the Application be treated as an application for other regulatory relief under item F. 3. of Appendix C to Rule 13-502, and

(ii) paying an activity fee of $1,500 in connection with the Fees Exemption application under item F. 3. of Appendix C to Rule 13-502.

Yours truly,

"Susan Silma"