Phoscan Chemical Corp. - s. 4(b) of the Regulation

Headnote

Consent given to an offering corporation under the Business Corporations Act (Ontario) to continue under the Canada Business Corporations Act.

Statutes Cited

Business Corporations Act, R.S.O. 1990, c. B.16, as am., s. 181

Canada Business Corporations Act, R.S.C. 1985, c. C-144, as am.

Securities Act, R.S.O. 1990, c. S.5, as am.

Regulations Cited

Regulation made under the Business Corporations Act, Ont. Reg. 289/00, as am., s. 4(b).

October 6, 2006

IN THE MATTER OF

THE REGULATION MADE UNDER

THE BUSINESS CORPORATIONS ACT,

R.S.O. 1990, c. B.16, AS AMENDED (the "OBCA")

ONTARIO REGULATION 289/00 (the "Regulation")

AND

IN THE MATTER OF

PHOSCAN CHEMICAL CORP.

CONSENT

(Clause 4(b) of the Regulation)

UPON the application (the "Application") of Phoscan Chemical Corp. (the "Corporation") to the Ontario Securities Commission (the "Commission") requesting the consent of the Commission to continue into another jurisdiction pursuant to clause 4(b) of the Regulation;

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

AND UPON the Corporation having represented to the Commission that:

1. The Corporation is a corporation existing under the provisions of the OBCA. The registered office of the Corporation is located at 360 Bay Street, Suite 500, Toronto, Ontario, M5H 2V6.

2. The authorized share capital of the Corporation consists of an unlimited number of common shares of which 48,185,219 were issued and outstanding as of October 4, 2006.

3. The Corporation is proposing to submit an application to the Director appointed under the OBCA for authorization to continue under the Canada Business Corporations Act, R.S.C. 1985, c. C-44, as amended (the "CBCA"), pursuant to section 181 of the OBCA (the "Application for Continuance").

4. Pursuant to clause 4(b) of the Regulation, where a corporation is an offering corporation under the OBCA, the Application for Continuance must be accompanied by a consent from the Commission.

5. The Corporation is an offering corporation under the OBCA and is a reporting issuer under the Securities Act, R.S.O. 1990, c. S.5, as amended (the "Act"). The Corporation is also a reporting issuer in the provinces of British Columbia and Alberta.

6. The Corporation's common shares are listed for trading on The TSX Venture Exchange under the symbol "FOS".

7. The Corporation is not in default of any of the provisions of the Act or the regulations or rules made under the Act and is not in default under the security legislation of any other jurisdiction where it is a reporting issuer.

8. The Corporation is not a party to any proceeding or to the best of its knowledge information and belief, pending proceeding under the Act.

9. The Corporation presently intends to remain a reporting issuer in the Provinces of Ontario, British Columbia and Alberta following the continuance.

10. The continuance under the CBCA was voted on and duly approved by the shareholders of the Corporation at the annual and special meeting of shareholders (the "Meeting") held on September 27, 2006 by more than 66 2/3% of the votes cast.

11. The management information circular of the Corporation dated August 22, 2006, provided to all the shareholders of the Corporation in connection with the Meeting, included a summary of the differences between the CBCA and the OBCA and advised holders of the Corporation's common shares of their dissent rights in connection with the continuance pursuant to Section 185 of the OBCA.

12. The continuance under the CBCA has been proposed because the Corporation believes it to be in its best interest to conduct its affairs in accordance with the CBCA.

13. The material rights, duties and obligations of a corporation under the CBCA are substantially similar to those under the OBCA with the exception that the OBCA requires a majority of a corporation's directors be resident Canadians whereas the CBCA requires only one-quarter of directors need be resident Canadians.

AND UPON the Commission being satisfied that to do so would not be prejudicial to the public interest;

THE COMMISSION hereby consents to the continuance of the Corporation under the CBCA.