RDS Acquisition Corp. - s. 4(b) of the Regulation

Headnote

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

Statutes Cited

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

Business Corporations Act, S.B.C. 2002, c. 57.

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)

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

IN THE MATTER OF

ONTARIO REGULATION 289/00, AS AMENDED

(the "Regulation")

MADE UNDER THE

BUSINESS CORPORATIONS ACT,

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

AND

IN THE MATTER OF

RDS ACQUISITION CORP.

CONSENT

(Subsection 4(b) of the Regulation)

UPON the application of RDS Acquisition Corp. (the "Corporation") to the Ontario Securities Commission (the "Commission") requesting the consent of the Commission for the Corporation to continue in another jurisdiction pursuant to subsection 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 proposes to make an application to the Director under the Business Corporations Act (Ontario) (the "OBCA") pursuant to Section 181 of the OBCA (the "Application for Continuance") for authorization to continue as a corporation under the Business Corporations Act (British Columbia), S.B.C. 2002, c. 57 (the "BCBCA").

2. The Application for Continuance is being made in connection with a proposed business combination structured as a 'three cornered' amalgamation (the "Proposed Transaction") involving the Corporation, Rapid Refill Ink International Corp., a corporation incorporated under the laws of the State of Minnesota ("RRI") and a wholly-owned subsidiary of the Corporation ("Subco") incorporated under the laws of the State of Minnesota, pursuant to which the Corporation will acquire all of the issued and outstanding shares of RRI, and RRI and Subco will amalgamate as a wholly-owned subsidiary of the Corporation.

3. Pursuant to subsection 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 of the Commission.

4. The Corporation was incorporated under the Business Corporations Act (Ontario) by certificate of incorporation effective on January 19, 2006. As part of the Proposed Transaction, the Corporation is proposing to change its name to "Rapid Brands Inc.".

5. The Corporation's head office is located at 5 Hazelton Avenue, Suite 300, Toronto, Ontario, M5R 2E1.

6. The authorized share capital of the Corporation consists of an unlimited number of common shares (the "Common Shares"), of which 10,100,000 are issued and outstanding. As part of the Proposed Transaction, the Corporation is proposing to consolidate the issued and outstanding Common shares on a 10 for 1 basis and to amend its articles to create a new class of non-voting convertible preference shares.

7. The Corporation's issued and outstanding Common Shares are listed for trading on the TSX Venture Exchange under the symbol "RA.P".

8. The Corporation is an offering corporation under the provisions of the OBCA and is a reporting issuer within the meaning of the Securities Act, R.S.O. 1990, c. s. 5, as amended (the "OSA"), and within the meaning of the Securities Act (British Columbia), R.S.B.C. 1996, c. 418 (the "BCSA") and the Securities Act (Alberta), R.S.A. 2000, c. S-4 (the "ASA"). The Corporation intends to remain a reporting issuer in Ontario and in British Columbia and Alberta.

9. The Corporation is not in default under any provision of the OSA or the Regulations or Rules made thereunder, and is not in default under the BCSA or the ASA.

10. The Corporation is not a party to any proceeding or, to the best of its knowledge, information and belief, any pending proceeding under the OSA, BCSA or the ASA.

11. The Corporation's shareholders authorized the continuance of the Corporation as a corporation under the BCBCA by special resolution at the annual and special meeting of shareholders held on May 22, 2007 (the "Meeting"). The special resolution authorizing the continuance was approved at the Meeting by 100% of the votes cast.

12. Pursuant to Section 185 of the OBCA, all shareholders of record as of the record date for the Meeting were entitled to exercise dissent rights with respect to the Application for Continuance (the "Dissent Rights").

13. The management information circular of the Corporation describing the Continuance dated April 26, 2007 (the "Information Circular"), provided to the shareholders together with the notice of Meeting, advised them of their Dissent Rights in connection with the continuance pursuant to section 185 of the OBCA.

14. Due to the international nature of RRI's business, as more particularly described in the Information Circular, management believes that having British Columbia company status is in the interest of the Corporation as there is no Canadian residency requirement for the directors under the BCBCA and the Corporation believes this will make it easier to retain international talent for its board of directors.

15. The material rights, duties and obligations of a corporation governed by the BCBCA are substantially similar to those of a corporation governed by the OBCA.

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 as a corporation under the BCBCA.

DATED this 25th day of May, 2007.