Horizons ETFs Management (Canada) Inc. et al.

Headnote

NP 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- Approval granted for change of control of mutual fund manager under section 5.5(2) of NI 81-102 -- There are no current plans to change the managers of the Funds, or to amalgamate or merge the current managers with any other entity or entities, for the foreseeable future.

Applicable Legislative Provisions

National Instrument 81-102 Mutual Funds, ss. 5.5(2), 19.1.

October 27, 2011

IN THE MATTER OF

THE SECURITIES LEGISLATION OF

ONTARIO

(THE JURISDICTION)

AND

IN THE MATTER OF

THE PROCESS FOR EXEMPTIVE RELIEF

APPLICATIONS IN MULTIPLE JURISDICTIONS

AND

IN THE MATTER OF

HORIZONS ETFS MANAGEMENT (CANADA) INC.

(formerly "BETAPRO MANAGEMENT INC.")

ALPHAPRO MANAGEMENT INC.

(THE MANAGERS)

AND

THE FUNDS LISTED IN SCHEDULE A

(THE FUNDS)

DECISION

Background

The principal regulator in the Jurisdiction has received an application from the Managers for a decision under the securities legislation of the Jurisdiction (the Legislation) for approval of a change of control of the Managers (the Manager Change of Control) of the Funds in accordance with Section 5.5(2) of National Instrument 81-102 Mutual Funds (NI 81-102) (the Approval Sought).

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 Managers have provided notice that section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in each province and territory of Canada other than Ontario (collectively with Ontario, the Jurisdictions).

Interpretation

Defined terms contained in National Instrument 14-101 Definitions and MI 11-102 have the same meaning in this decision unless they are otherwise defined in this decision.

Representations

The decision is based on the following facts represented by the Managers and Mirae Asset Financial Group (Mirae Asset Financial):

Horizons ETFs Management (Canada) Inc. (Horizons)

1. Horizons is a corporation incorporated under the laws of Canada and has its head office in Toronto, Ontario.

2. BetaPro Management Inc. (BetaPro) recently changed its name to "Horizons ETFs Management (Canada) Inc." Other than the termination of the officers or directors of BetaPro who are also officers or directors of Jovian, there is no current intention to significantly change the officers or registered individuals of BetaPro.

3. Horizons is the manager and trustee of the Horizons Funds listed in Schedule A.

4. Horizons is registered as an investment fund manager (an IFM) in Ontario.

5. The Horizons Funds are reporting issuers in all of the Jurisdictions, are all listed on the Toronto Stock Exchange (the TSX) and are offered by means of a long form prospectus in accordance with the requirements of Form 41-101F2.

6. Neither Horizons nor any of the Horizons Funds is in default of applicable securities legislation in any of the Jurisdictions.

AlphaPro Management Inc. (AlphaPro)

7. AlphaPro is a corporation incorporated under the laws of Canada and has its head office in Toronto, Ontario.

8. AlphaPro is the manager and trustee of the AlphaPro Funds listed in Schedule A.

9. AlphaPro is registered as an IFM in Ontario.

10. The AlphaPro Funds are reporting issuers in all of the Jurisdictions, are all listed on the TSX and are offered by means of a long form prospectus in accordance with the requirements of Form 41-101F2.

11. Neither AlphaPro nor any of the AlphaPro Funds is in default of applicable securities legislation in any of the Jurisdictions.

The Transaction

12. The Managers are currently indirect subsidiaries of Jovian Capital Corporation (Jovian). Jovian is a financial services company listed on the TSX with its common shares trading under the symbol "JOV".

13. Presently, Jovian's wholly-owned subsidiary, Jovian Asset Management Inc. (JAMI) owns 58% of Horizons. The remaining 42% interest in Horizons is held by 6386474 Canada Inc. (26%), 2026860 Ontario Inc. (9%) and 1717681 Ontario Inc. (7%). Horizons in turn owns 50% of AlphaPro. JAMI's wholly-owned subsidiary, JovFunds Management Inc., owns another 30% of AlphaPro and NBF International Holdings Inc. owns the remaining 20%..

14. In a press release dated July 15, 2011, Jovian announced that it intends to sell its controlling interest in the Managers to Mirae Asset Global Investments Co., Ltd. (the Transaction).

15. The Transaction is expected to close on or about October 31, 2011 or on such later date when all of conditions precedent have been satisfied or waived, and all approvals have been obtained, and ideally no later than November 15, 2011 (the Closing).

16. Prior to closing, Mirae Asset Global Investments Co., Ltd. (Mirae) will assign its rights and obligations under the share purchase agreement dated July 14, 2011 between Mirae and Jovian (the SPA) to its wholly-owned subsidiary, Mirae Asset Canada Acquisition Inc. (Mirae Canada), pursuant to section 13.5 of the SPA.

17. Following the Transaction, while Mirae will become the new owner of the Managers (through Mirae Canada), no changes are expected in terms of how the Managers operate or act in relation to the Funds.

18. Following the Transaction, Horizons will be an indirect subsidiary of Mirae through Mirae Canada (as Mirae Canada will own 85% of Horizons). The remaining interest in Horizons will be held by 6386474 Canada Inc. (10%), 2026860 Ontario Inc. (1.5%) and 1717681 Ontario Inc. (3.5%). AlphaPro will be an indirect subsidiary of Mirae through Mirae Canada's direct subsidiary, Horizons (as Horizons will own 80% of AlphaPro). The remaining 20% interest in AlphaPro will be held by NBF International Holdings Inc.

Mirae

19. Mirae is a member of Mirae Asset Financial, which is the leading independent financial services group in Asia. While Mirae Asset Financial's core business is asset management, it also provides comprehensive financial services in the areas of wealth management and life insurance.

20. Headquartered in Seoul, South Korea, Mirae Asset Financial has a presence in Hong Kong, China, India, Vietnam, Taiwan, Brazil, the U.K. and the U.S. Mirae is one of the world's largest investment managers in emerging market equities. As of June 30, 2011, Mirae managed over U.S. $53 billion in assets globally.

21. Mirae Canada is the only Canadian subsidiary of Mirae Asset Financial.

Manager Change of Control

22. In respect of the impact of the Manager Change of Control on the Managers and the management and administration of the Funds:

(a) Mirae has confirmed that there is no current intention:

(i) to make any substantive changes as to how the Managers operate or manage the Funds;

(ii) to merge the Managers with any other IFM;

(iii) immediately following the Transaction, to change any of the Managers to either Mirae or an affiliate of Mirae; and

(iv) within a foreseeable period of time, to change any of the Managers to either Mirae or an affiliate of Mirae;

(b) Mirae has confirmed that it currently intends to maintain the Horizons Funds and AlphaPro Funds listed in Schedule A as separately managed fund families managed by the Managers.

(c) the Transaction after Closing is not expected to have any material impact on the business, operations or affairs of the Funds or the securityholders of the Funds;

(d) other than the termination of officers or directors of the Managers who are also officers or directors of Jovian, there is no current intention to significantly change the officers or registered individuals of the Managers;

(e) it is not expected that there will be any change in how the Funds are managed or the expenses that are charged to the Funds as a result of the Transaction; and

(f) the Transaction is only expected to benefit the Managers and will not adversely affect their financial position or their ability to fulfill their regulatory obligations.

Notice Requirement

23. The notice to the securityholders of the Funds with respect to the Transaction in accordance with Section 5.8(1)(a) of NI 81-102 (the Notice) was mailed to such securityholders on August 19, 2011, which was more than 60 days before the Closing.

24. The Notice was filed on SEDAR as soon after August 19, 2011, as was reasonably practicable.

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.

The decision of the principal regulator under the Legislation is that the Approval Sought is granted.

SCHEDULE A

FUNDS

Horizons Funds

AlphaPro Funds