Phoenix Global Advisors, LLC - ss. 38(1) of the CFA

Headnote

Relief from the adviser registration requirement of paragraph 22(1)(b) of the Commodity Futures Act (Ontario) (CFA) granted to a non-resident adviser in connection with the proposed advisory services to be provided to a registered commodity trading manager under the CFA for a term of 3 years, subject to certain terms and conditions, pursuant subsection 38(1) of the CFA.

Statutes Cited

Commodity Futures Act, R.S.O. 1990. c. C.20., as am., ss. 22(1)(b), 38(1).

Securities Act, R.S.O. 1990, c. S.5 (as am.) - OSC Rule 35-502 -- Non-Resident Advisers, s. 7.3.

IN THE MATTER OF

THE COMMODITY FUTURES ACT,

R.S.O. 1990, CHAPTER S.20, AS AMENDED (THE CFA)

AND

IN THE MATTER OF

PHOENIX GLOBAL ADVISORS, LLC

ORDER

(Subsection 38(1) of the CFA)

UPON the application of Phoenix Global Advisors, LLC (Phoenix) to the Ontario Securities Commission (the Commission) for a ruling under subsection 38(1) of the CFA that Phoenix, its officers, directors and representatives are not subject to the requirements of subsection 22(1)(b) of the CFA;

AND UPON considering the application and the recommendation of staff of the Commission;

AND UPON Phoenix having represented to the Commission as follows:

1. Phoenix is a limited liability company organized under the laws of the State of Delaware. Phoenix is registered with the Commodity Futures Trading Commission (the CFTC) in the United States of America as a commodity trading advisor and is a member of the National Futures Association (the NFA) in the United States of America.

2. Phoenix has entered into a sub-advisory agreement, dated December 31, 2004 and effective February 7, 2005, with Toron Capital Markets Inc. (Toron) and Horizons Phoenix Hedge Fund (the Fund), whereby Toron would act as the portfolio manager to the Fund in respect of purchases and sales of derivative instruments including commodity futures contracts or related products traded on commodity futures exchanges and cleared through acceptable clearing corporations outside of Canada, such as standard futures contracts based on currency, bonds and short-term fixed income securities, and Phoenix would act as sub-adviser to Toron (the Proposed Advisory Services).

3. The Fund is an open-end mutual fund trust established under to the laws of British Columbia.

4. The Fund is a "mutual fund" as such term is defined in subsection 1(1) of the Securities Act (Ontario) and a "commodity pool" as such term is defined in section 1.1 of Multilateral Instrument 81-104 -- Commodity Pools, in that the Fund will invest in specified derivatives in a manner that is not permitted by National Instrument 81-102 -- Mutual Funds.

5. Toron is a corporation organized under the laws of Ontario and is resident in Ontario. Toron is currently registered with the Commission as an adviser (Investment Counsel and Portfolio Manager) and Limited Market Dealer. Toron is also currently registered with the Commission as an adviser in the category of Commodity Trading Manager under the CFA. Toron is responsible for the investment advice provided by Phoenix. As portfolio manager to the Fund, Toron manages the assets of the Fund by selecting, retaining, removing, replacing and adding sub-advisers in accordance with the investment objectives of the Fund.]

6. In connection with the Proposed Advisory Services, Phoenix has entered into a written agreement with Toron and the Fund setting out the obligations and duties of Phoenix. Under this agreement, Toron has assumed responsibility to the Fund for all advice provided by Phoenix.

7. Phoenix will only provide advice to Toron where Toron has contractually agreed with the Fund to be responsible for any loss that arises out of the failure of Phoenix to:

(a) exercise its powers and discharge its duties honestly, in good faith and in the best interests of Toron and the Fund; or

(b) exercise the degree of care, diligence and skill that a reasonably prudent person would exercise in the circumstances;

(the "Standard of Care"), and this responsibility cannot be waived.

8. Phoenix will only provide advice to Toron in connection with Fund. The offering documents of the Fund will disclose that:

(a) Toron has responsibility for the investment advice or portfolio management services provided by Phoenix; and

(b) to the extent applicable, there may be difficulty in enforcing legal rights against Phoenix because it is resident outside of Canada and all or a substantial portion of its assets are situated outside of Canada.

9. Phoenix will only provide advice to Toron so long as Toron remains a registrant under the CFA while the Proposed Advisory Services are provided by Phoenix.

AND UPON being satisfied that it would not be prejudicial to the public interest for the Commission to grant the exemptions requested;

IT IS ORDERED pursuant to subsection 38(1) of the CFA that Phoenix, its officers, directors and representatives are not subject to the requirements of subsection 22(1)(b) of the CFA in respect of the Proposed Advisory Services provided that:

(a) the obligations and duties of Phoenix are set out in a written agreement with Toron;

(b) Phoenix will only provide advice to Toron where Toron has contractually agreed with the Fund to be responsible for any loss that arises out of the failure of Phoenix to meet the Standard of Care and such responsibility cannot be waived;

(c) Phoenix will only provide advice to Toron where the offering documents for the Fund disclose that Toron is responsible for any loss that arises out of the failure of Phoenix to meet the Standard of Care, and that

(i) Toron has responsibility for the investment advice or portfolio management services provided by Phoenix, and

(ii) there may be difficulty in enforcing any legal rights against Phoenix because it is resident outside of Canada and all or a substantial portion of its assets are situated outside of Canada;

(d) Phoenix continues to be registered with the CFTC as a commodity trading advisor and a member of the NFA;

(e) Phoenix will only provide advice to Toron so long as Toron remains a registrant under the CFA while the Proposed Advisory Services are provided by Phoenix; and

(f) this order shall terminate three years from the date of the order.

March 1, 2005.