Securities Law & Instruments

Headnote

National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- exemption granted from certain financial disclosure requirements applicable in the case of a reverse takeover transaction pursuant to Section 4.10 of NI 51-102 and NI 52-107 -- target companies do not meet the definition of junior issuer due to a change in year end during the most recently completed financial year -- relief granted from the audit requirement in respect of the annual financial statements for the third most recently completed financial year -- relief granted to permit the auditor's report on the financial statements for the second most recently completed financial year to contain a reservation with respect to opening inventory.

Applicable Legislative Provisions

National Instrument 51-102 Continuous Disclosure Obligations, s. 4.10.

National Instrument 52-107 Acceptable Accounting Principles, Auditing Standards and Reporting Currency, s. 3.2(a).

June 2, 2010

IN THE MATTER OF

THE SECURITIES LEGISLATION OF

THE PROVINCE OF ONTARIO

(the "Jurisdiction")

AND

IN THE MATTER OF

THE PROCESS FOR EXEMPTIVE RELIEF

APPLICATIONS IN MULTIPLE JURISDICTIONS

AND

IN THE MATTER OF

OCULUS VENTURES CORPORATION (the "Filer")

AND THE FILER'S PROPOSED ACQUISITION

OF ALL OF THE ISSUED AND OUTSTANDING

SHARES OF 1384694 ONTARIO INC., BALIMORE

LIMITED, SEQUENCE ELECTRONICS INC.

(collectively, together with their respective

subsidiaries, the "Target Companies")

DECISION

Background

The principal regulator in the Jurisdiction has received an application from the Filer for a decision under the securities legislation of the Jurisdiction of the principal regulator (the "Legislation") for relief from continuous disclosure obligations, specifically:

(a) the audit requirement in respect of the annual financial statements for the Target Companies for the year ended January 31, 2008, being the third most recently completed financial year of the Target Companies; and

(b) the requirement to have an auditor's report that does not contain a reservation in respect of the financial statements for the Target Companies for the year ended January 31, 2009, being the second most recently completed financial year of the Target Companies,

such that a Filing Statement filed pursuant to the policies of the TSX Venture Exchange (the "TSXV") with the following Target Company financial statements will satisfy the requirement in Subsection 4.10(2) of National Instrument 51-102 -- Continuous Disclosure Obligations ("NI 51-102") to file the financial statements for the reverse takeover acquirer that would be required to be included in a prospectus:

(a) Unaudited interim statements for the three months ended January 31, 2010;

(b) Audited annual (transition year) statements for the nine months ended October 31, 2009;

(c) Audited annual statements for the twelve months ended January 31, 2009 (with qualification only as to opening inventory); and

(d) Unaudited annual statements for the twelve months ended January 31, 2008.

Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):

(a) the Ontario Securities Commission is the principal regulator for this application, and

(b) the Filer has provided notice that section 4.7(1) of Multilateral Instrument 11-102 Passport System ("MI 11-102") is intended to be relied upon in the Provinces of Alberta and British Columbia.

Interpretation

Terms defined in National Instrument 14-101 Definitions and MI 11-102 have the same meaning if used in this decision, unless otherwise defined.

Representations

This decision is based on the following facts represented by the Filer:

1. The Filer has selected the Ontario Securities Commission as Principal Regulator for this application since the Filer's head office is located in the Province of Ontario.

2. The Filer was incorporated pursuant to the Canada Business Corporations Act on May 8, 2007.

3. The Filer completed an initial public offering of its Class A Shares on March 25, 2008 as a Capital Pool Company pursuant to TSXV Policy 2.4 and the Class A Shares began trading on the TSXV on April 1, 2008 under the symbol "OVX.P".

4. The Filer is not in default of securities legislation in any jurisdiction.

5. The Filer has identified the acquisition of the Target Companies as an appropriate transaction to constitute its Qualifying Transaction (as defined in the policies of the TSXV). It is proposed that the Filer will acquire 100% of the issued and outstanding shares of each of the Target Companies (the "Acquisition").

6. The Acquisition will be a reverse takeover as defined in NI 51-102.

7. Subsection 4.10(2) of NI 51-102 requires an issuer that has completed a reverse takeover to file, within a specific period of time, the financial statements for the reverse takeover acquirer that would have been required to be included in the form of a prospectus that the reserve takeover acquirer was eligible to use prior to the reverse takeover for a distribution of securities in the jurisdiction, to the extent that it has not already included such statements in an information circular or similar document previously filed.

8. The available form of prospectus is described in Form 41-101F1 in National Instrument 41-101 -- General Prospectus Requirements ("NI 41-101")

9. In connection with the Acquisition, the Filer proposes to file a Filing Statement pursuant to TSXV Policy 2.4. The Target Company financial statement requirements in a TSXV Filing Statement are the same as the financial statement requirements in a prospectus filed pursuant to NI 41-101. Therefore, the financial statement disclosure in a TSXV Filing Statement satisfies the continuous disclosure requirements under Subsection 4.10(2) of NI 51-102 described above.

10. The Target Companies have changed their financial year end in 2009 from January 31 to October 31. As such, the most recent three financial years for the Target Companies are as follows:

a. nine months ended October 31, 2009;

b. twelve months ended January 31, 2009; and

c. twelve months ended January 31, 2008.

11. The Filer is proposing to including the following Target Company financial statements in the Filing Statement filed in connection with the Acquisition:

a. Unaudited interim statements for the three months ended January 31, 2010;

b. Audited annual (transition year) statements for the nine months ended October 31, 2009;

c. Audited annual statements for the twelve months ended January 31, 2009 (with qualification only as to opening inventory); and

d. Unaudited annual statements for the twelve months ended January 31, 2008.

12. Including financial statements for the nine month transition year ended October 31, 2009 satisfies the requirement to deliver financial statements for one of the three financial years to be included in the Filing Statement or in a prospectus pursuant to NI 41-101 (see Subsection 32.2(4) of Form 41-101F1).

13. The auditor's report on the financial statements of the Target Companies for the year ended January 31, 2009 contains a reservation relating to opening inventory as the auditors were not able to observe the counting of physical inventories and are not able to satisfy themselves concerning those inventory quantities by alternative means. The auditor's report on the financial statements for the nine-month period ended October 31, 2009 will contain no reservation and the business of the Filer is not seasonal.

14. The statements for the three months ended January 31, 2010 and the twelve months ended January 31, 2008 will be subject to a review engagement.

15. The annual statements included in a Filing Statement or prospectus pursuant to NI 41-101 must be audited except that the audit requirement does not apply to the annual financial statements for the second and third most recently completed financial years if (i) the issuer is a junior issuer; and (ii) the financial statements for the most recently completed financial year required is not less than twelve months in length (see Paragraph 32.5(b) of Form 41-101F1).

16. The Target Companies, as a group, would meet the definition of junior issuer in the context of filing a preliminary prospectus. However, due to the change in year end during the most recently completed financial year that financial year is only nine months in length. As a result, the Target Companies do not meet the test in Paragraph 32.5(b) of Form 41-101F1 for the exemption from audit for the second and third most recently completed financial years.

17. The current auditors of the Target Companies did not act as auditors to the Target Companies during the fiscal year ended January 31, 2008 and those financial statements have never been audited.

18. If the most recently completed financial year of the Target Companies was twelve months in length the Target Companies, as a group, would be eligible for the junior issuer exemption from the audit requirement in respect of the annual financial statements for the second and third most recently completed financial years.

19. Section 13.1 of NI 51-102 provides that the regulator or securities regulatory authority may grant an exemption from NI 51-102, in whole or in part, subject to such conditions or restrictions as may be imposed in the exemption.

Decision

The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.

"Jo-Anne Matear"
Assistant Manager, Corporate Finance
Ontario Securities Commission