confidential offering memorandumagilith.com/assets/offering memorandum - october 15 2013.pdf ·...

Investors’ Copy

CONFIDENTIAL OFFERING MEMORANDUM

This Offering Memorandum constitutes an offering of these securities only in those jurisdictions where they may be lawfullyoffered for sale and therein only by persons permitted to sell such securities and to those persons to whom they may belawfully offered for sale. No securities commission or similar regulatory authority in Canada has reviewed this OfferingMemorandum or has in any way passed upon the merits of the securities offered hereunder and any representation to thecontrary is an offence. No prospectus has been filed with any such authority in connection with the securities offeredhereunder. This Offering Memorandum is confidential and is provided to specific prospective investors for the purpose ofassisting them and their professional advisers in evaluating the securities offered hereby and is not to be construed as aprospectus or advertisement or a public offering of these securities.

Continuous Offering October 15, 2013

AGILITH NORTH AMERICAN DIVERSIFIED FUND LP

Limited Partnership Units

Agilith North American Diversified Fund LP (the “Partnership”) is an Ontario limited partnership formed toinvest in securities. The Partnership will seek to achieve capital appreciation and manage risk by investing in adiversified portfolio of North American-based equity securities.

The Partnership was formed on September 25, 2007 and will continue until it is dissolved. Agilith NorthAmerican Diversified GP Inc. (the “General Partner”) is the general partner of the Partnership. The Partnershipis a related issuer of Agilith Capital Inc. (the “Investment Manager”), the investment manager of thePartnership and an affiliate of the General Partner. The Investment Manager will earn fees from thePartnership. Also, the General Partner will be entitled to receive distributions from the Partnership. See “Conflictsof Interest”. Purchasers of Units become Limited Partners of the Partnership and will be bound by the terms of aLimited Partnership Agreement governing the Partnership.

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SUBSCRIPTION PRICE: $1,000 PER UNITMINIMUM INITIAL INVESTMENT: $150,000 OR

$50,000 FOR ACCREDITED INVESTORS_______________________________________________________________________

Units are being issued in three different classes: Class A Units, Class I Units and Class M Units. Each class willhave different management fees and different profit-sharing arrangements with the General Partner. Units of eachclass will be issued in series. Purchasers of Units will generally be issued Class A Units.

These securities are speculative. A subscription for Units should be considered only by persons financially able tomaintain their investment and who can bear the risk of loss associated with an investment in the Partnership.

Investors should be aware that they may be allocated income annually for tax purposes but will not receive anycash distributions from the Partnership.

There is no market through which the Units may be sold and none is expected to develop. The Units arealso subject to resale restrictions under the Partnership’s Limited Partnership Agreement and applicablesecurities legislation. Persons who receive this Offering Memorandum must inform themselves of, andobserve, all applicable restrictions with respect to the acquisition or disposition of Units under applicable

Confidential Offering Memorandum Investors’ CopyAgilith North American Diversified Fund LP October 15, 2013

securities legislation. Redemptions will be limited if there is insufficient liquidity in the Partnership. Thereare certain additional risk factors associated with investing in the Units. Investors should consult their ownprofessional advisers to assess the income tax, legal and other aspects of the investment. Please see “Risk Factors”and “Transfer or Resale”.

The securities offered hereby are offered exclusively by the Partnership on a private placement basis in relianceupon exemptions from the prospectus and registration requirements of applicable securities laws in the provincesof Ontario, Quebec, Manitoba, Alberta and British Columbia. Prospective investors must be “accreditedinvestors” as defined under applicable securities laws unless another exemption from the prospectus andregistration requirements can be relied on. No person is authorized to give away any information or to make anyrepresentation not contained in this Offering Memorandum and any information or representation, other than thatcontained in this Offering Memorandum, must not be relied upon. This Offering Memorandum is a confidentialdocument furnished solely for the use of prospective purchasers who, by acceptance hereof, agree that they shallnot transmit, reproduce or make available this document or any information contained in it.

Subscribers are urged to consult with an independent legal adviser prior to signing the Subscription for theUnits and to carefully review the Limited Partnership Agreement delivered with this OfferingMemorandum.


TABLE OF CONTENTSSUMMARY .................................................................................................................................................. iTHE PARTNERSHIP ................................................................................................................................ 1THE GENERAL PARTNER..................................................................................................................... 1THE INVESTMENT MANAGER ............................................................................................................ 1INVESTMENT OBJECTIVES AND STRATEGIES OF THE PARTNERSHIP................................ 2THE OFFERING........................................................................................................................................ 5MINIMUM INDIVIDUAL SUBSCRIPTIONS........................................................................................ 5WHO SHOULD INVEST .......................................................................................................................... 5SUBSCRIPTIONS ...................................................................................................................................... 6

Prospectus Exemptions ............................................................................................................................. 7Accredited Investors ................................................................................................................................. 7Know-Your-Client and Suitability............................................................................................................ 7Leverage Disclosure Statement (Using Borrowed Money to Purchase Units) ......................................... 8

REDEMPTIONS......................................................................................................................................... 8TRANSFER OR RESALE......................................................................................................................... 9NET ASSET VALUE.................................................................................................................................. 9

Valuation Principles.................................................................................................................................. 9INVESTMENT MANAGEMENT AGREEMENT ............................................................................... 11PROFIT ALLOCATION......................................................................................................................... 11SUMMARY OF LIMITED PARTNERSHIP AGREEMENT ............................................................. 12

Authority and Duties of the General Partner .......................................................................................... 13The Units................................................................................................................................................. 13Allocation of Income and Loss ............................................................................................................... 14Distributions............................................................................................................................................ 14Redemptions ........................................................................................................................................... 15Expenses ................................................................................................................................................. 15Power of Attorney................................................................................................................................... 15Management Fees ................................................................................................................................... 15Liability................................................................................................................................................... 16Reports to Limited Partners .................................................................................................................... 16Fiscal Year .............................................................................................................................................. 17Amendment............................................................................................................................................. 17Term........................................................................................................................................................ 17

PRIME BROKERAGE AGREEMENT ................................................................................................. 17CANADIAN INCOME TAX CONSIDERATIONS AND CONSEQUENCES .................................. 18RISK FACTORS....................................................................................................................................... 18

Risks Associated with an Investment in the Partnership ........................................................................ 18Risks Associated with the Partnership’s Underlying Investments.......................................................... 22

CONFLICTS OF INTEREST ................................................................................................................. 24CONFLICTS OF INTEREST POLICY................................................................................................. 24

Statement of Policies Concerning Conflicts of Interest with Related Issuers and Connected Issuers.... 24Fairness Policy........................................................................................................................................ 25Soft Dollar Arrangements ....................................................................................................................... 26Statement of Related Registrants ............................................................................................................ 26

PROCEEDS OF CRIME (MONEY LAUNDERING) LEGISLATION ............................................. 27FINANCIAL REPORTING..................................................................................................................... 27STATUTORY RIGHTS OF ACTION AND RESCISSION................................................................. 27


SUMMARY

This summary is qualified by the more detailed information appearing elsewhere in this OfferingMemorandum. Capitalized terms used but not defined in this summary are defined elsewhere in thisOffering Memorandum.

The Partnership: Agilith North American Diversified Fund LP (the “Partnership”), alimited partnership formed under the laws of the Province of Ontario.

General Partner: Agilith North American Diversified GP Inc. (the “General Partner”), acorporation incorporated under the laws of the Province of Ontario. TheGeneral Partner was instrumental in the formation of the Partnership and isresponsible for appointing the Investment Manager and monitoring theactivities of the Investment Manager on behalf of the Partnership. TheGeneral Partner will receive a share of Partnership profits. See “TheGeneral Partner” and “Summary of Limited Partnership Agreement –Allocation of Profit and Loss”.

Investment Manager: Agilith Capital Inc. (the “Investment Manager”), a corporationincorporated under the laws of the Province of Ontario. The GeneralPartner has engaged the Investment Manager to direct the affairs of thePartnership and to provide day-to-day management services to thePartnership, management of the Partnership’s portfolio on a discretionarybasis and distribution of the Units of the Partnership. See “The InvestmentManager”.

Investment Objectivesand Strategies

The investment objective of the Partnership is to provide Limited Partnerswith long term capital growth through selection and management of adiverse base of equity positions in publicly and privately traded NorthAmerican issuers.

To achieve the Partnership’s investment objective, the Partnership willinvest in:

Undervalued securities. Growth securities. Short term catalyst opportunities. Paired trading

Through extensive industry experience and a thorough analysis offundamentals combined with selective quantitative and technical analysis,the Partnership believes that the Investment Manager possesses acompetitive advantage with respect to the identification of marketopportunities. The Partnership believes that its size allows it to takeadvantage of less liquid market opportunities where larger funds are at atrading disadvantage.

Although the Partnership does not intend to utilize significant leverage, ithas no restriction on doing so, to a maximum of 100% in the aggregate (atthe time of leverage) of the Net Asset Value of the Partnership. ThePartnership may borrow or purchase securities on margin. The Partnershipmay take short sale positions and write uncovered options to enhance

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returns.

See “Investment Objectives and Strategies of the Partnership”.

The Offering: Three classes of limited partnership units (the “Units”) are currently beingoffered: Class A Units are available to all investors who meet the minimuminvestment criteria. Class I Units will only be issued to certain institutionalinvestors. Both Class A Units and Class I Units share profits with theGeneral Partner and are charged a management fee. Class M Units willgenerally only be issued to associates and affiliates of the InvestmentManager and its directors, officers and employees. No management fee willbe payable in respect of Class M Units, nor will Class M Units share profitswith the General Partner. See “The Offering”, “Summary of LimitedPartnership Agreement – The Units” and “Investment ManagementAgreement”.

Minimum IndividualSubscription:

The Units are being distributed only pursuant to available exemptions inOntario, Quebec, Manitoba, Alberta and British Columbia to investors (a)who are accredited investors under National Instrument 45-106, (b) exceptin Alberta, who invest a minimum of $150,000 in the Partnership, or (c) towhom Units may otherwise be sold. The minimum initial investment is$150,000 but may be reduced to $50,000 for accredited investors (or tosuch lesser amount as may be accepted by the Investment Manager).

Each additional investment must be not less than $10,000 and, for investorswho are not accredited investors and who initially acquired Units of thePartnership under the minimum amount exemption, at the time of theadditional investment, the Units held by the investor must have anacquisition cost or a Net Asset Value equal to at least $150,000.

At the time of making each additional investment, unless a newSubscription Agreement is executed, each investor will be deemed to haverepeated and confirmed to the Investment Manager the covenants andrepresentations contained in the Subscription Agreement delivered by theinvestor to the Investment Manager at the time of the initial investment.See “Minimum Individual Subscriptions”.

Subscriptions: Subscriptions for Units must be made by completing and executing thesubscription form and power of attorney (the “Subscription”) provided bythe Investment Manager and by forwarding to the Investment Managersuch form together with a cheque (or other form of funds transferacceptable to Investment Manager) representing payment of thesubscription price. Subscription funds provided prior to a Valuation Datewill be kept in a segregated account.

Subscriptions will be accepted on a monthly basis, being on the lastbusiness day in each month or such other date as the Investment Managermay permit (each, a “Valuation Date”), subject to the InvestmentManager’s discretion to refuse subscriptions in whole or in part. (Unitswill be issued as of the next business day.) The Investment Managerintends to fix an opening Net Asset Value of $1,000 per Unit for each new

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series. All new subscriptions are issued in series, with all subscriptions ofa particular class each month creating a new series. See “The Offering” and“Subscriptions”.

Redemptions: Redemptions will be permitted on a monthly basis, being on the lastbusiness day of each month, and on such other dates as the InvestmentManager may permit (each, a “Redemption Date”) pursuant to writtennotice that must be received by the Investment Manager at least 30 daysprior to the applicable Redemption Date. The redemption price shall equalthe Net Asset Value per Unit of the applicable class and series of Unitsbeing redeemed, determined as of the close of business on the relevantRedemption Date. There will be deducted from redemption proceedsotherwise payable an early redemption deduction (to be retained by thePartnership) of up to 5% of the Net Asset Value of such Units if thoseUnits are tendered for redemption within 90 days of purchase, or up to 2%of the Net Asset Value of such Units if those Units are tendered forredemption within 1 year of purchase, as further disclosed under“Redemptions”, as well as an amount equal to a distribution payable to theGeneral Partner on such date (to the extent not already reflected in NetAsset Value of the redeemed Units), as further described under “ProfitAllocation”. Units held by a redeeming Limited Partner will be redeemedon a first-in, first-out basis within the same class, however, if a Unitholderholds both Class A Units and Class I Units, Class I Units will beredeemed first (but there will be no early redemption deduction inrespect of such Units if Class A Units held by that Unitholder havebeen outstanding for more than the stipulated holding period).

Redemption proceeds will generally be paid within 15 business days of theRedemption Date, however the Investment Manager shall have the right tohold back up to 10% of the redemption price payable after all deductions toredeeming holders of Units in respect of any Redemption Date to providean orderly disposition of the Partnership’s assets to pay the redemptionprice payable per Unit to such Limited Partners. Payment of any amountheld back shall be made in accordance with the Partnership Agreement assoon as reasonably practicable.

If, in respect of any Redemption Date, the Investment Manager hasreceived requests to redeem Units representing 10% or more of the NetAsset Value of the Partnership, redemption of Units in excess of this 10%threshold may, in the Investment Manager’s discretion, be deferred untilthe Redemption Date next following such Redemption Date. Such deferralmay take place if, in the judgement of the Investment Manager, such extratime is warranted to facilitate the orderly liquidation of the Partnership’sassets to meet such redemptions. In such event, the redemption price perUnit will be based on the Net Asset Value per Unit on such subsequentRedemption Date.

Redemptions may also be deferred in other certain circumstances. See“Redemptions”. Redemption requests as at any Redemption Date will behonoured and/or deferred on a pro rata basis, but deferred redemptions willbe honoured in full before new redemption requests.

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The Investment Manager has the right to require a Limited Partner toredeem some or all of the Units owned by such Limited Partner on aRedemption Date at the Net Asset Value per Unit thereof, by notice inwriting to the Limited Partner given at least 30 days before the designatedRedemption Date, which right may be exercised by the InvestmentManager in its absolute discretion.

Transfer or Resale: Units may only be transferred with the consent of the Investment Managerand transfers will generally not be permitted. The transfer or resale of Units(which does not include a redemption of Units) is also subject torestrictions under applicable securities legislation. See “Transfer orResale”.

Management Fees: The Investment Manager will receive a monthly management fee (the“Management Fee”) on the last business day of each month equal to 1/12of 2% of the aggregate Net Asset Value of the Class A Units and 1/12 of0.75% of the aggregate Net Asset Value of the Class I Units on such date.No management fees are payable in respect of Class M Units. See“Investment Management Agreement”.

Management fees payable by the Partnership are subject to HST and willbe deducted as an expense of the Partnership in the calculation of the NetAsset Value of the Partnership.

Payment of Expenses: The Partnership shall be responsible for, and the General Partner and theInvestment Manager shall be entitled to reimbursement from thePartnership for all costs and operating expenses actually incurred inconnection with the business of the Partnership, including but not limitedto:

(i) administrative fees and expenses of the Partnership, which includeInvestment Manager’s fees, accounting and legal costs, insurancepremiums, custodial fees, registrar and transfer agency fees andexpenses, all Limited Partner communication expenses,organizational and set-up expenses, the cost of maintaining thePartnership’s existence and regulatory fees and expenses, and allreasonable extraordinary or non-recurring expenses; and

(ii) fees and expenses relating to the Partnership’s portfolioinvestments, including the cost of securities, interest on borrowingsand commitment fees and related expenses payable to lenders andcounterparties, brokerage fees, commissions and expenses, andbanking fees.

See “Limited Partnership Agreement – Expenses”.

Profit Allocation: The General Partner will share in the net profits of the Partnership byreceiving distributions on the last Valuation Date in each year and upon theredemption of a Unit based on the increase, if any, in the Net Asset Valueof such Unit. In respect of Class A Units, such distributions are equal to

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20% of the increase, if any, in the Net Asset Value of each such Unit overthe applicable High Water Mark of such Unit, subject to the holder of theClass A Unit achieving a return (the “Minimum Return”) of 6% (perannum) of such High Water Mark. In respect of Class I Units, suchdistributions equal 14% of the increase, if any, in the Net Asset Value ofeach such Unit over the applicable High Water Mark of such Unit, subjectto the holder of Class I Unit achieving the Minimum Return. A Unit’s“High Water Mark” is, initially, its subscription price, and thereafter shallbe adjusted from time to time to equal its Net Asset Value immediatelyfollowing the payment of an incentive distribution to the General Partner inrespect of such Unit. The General Partner will not receive distributions inrespect of Class M Units.

Limited Partners will, therefore, effectively share in net profits and netlosses of the Partnership by increases or decreases in the Net Asset Valueof their Units on the following basis:

(a) in respect of a Class A Unit, (i) any increases in Net Asset Value ofsuch Unit up to the Minimum Return first accrues to the benefit ofthe holder of such Unit, (ii) any increase in such Net Asset Valueof the Unit in excess of the Minimum Return, to a maximum of1.5% (per annum) of the High Water Mark (the “Class A Catch-up Return”), shall be distributed to the General Partner, and (iii)any increase in such Net Asset Value in excess of the MinimumReturn plus Class A Catch-up Return will accrue as to 80% to theholder of the Unit and the remaining 20% will be distributed to theGeneral Partner;

(b) in respect of a Class I Unit, (i) any increases in Net Asset Value ofsuch Unit up to the Minimum Return first accrues to the benefit ofthe holder of such Unit, (ii) any increase in such Net Asset Valueof the Unit in excess of the Minimum Return, to a maximum of0.98% (per annum) of the High Water Mark (the “Class I Catch-up Return”), shall be distributed to the General Partner, and (iii)any increase in such Net Asset Value in excess of the MinimumReturn plus Class I Catch-up Return will accrue as to 86% to theholder of the Unit and the remaining 14% will be distributed to theGeneral Partner; and

(c) in respect of Class M Units, any increase in Net Asset Value of anysuch Unit accrues to the benefit of the holders of such Units and nodistribution is payable to the General Partner.

Any distribution paid to the General Partner will be deducted from the NetAsset Value (or redemption proceeds, as the case may be) of the respectiveUnit. See “Profit Allocation”.

Allocations for TaxPurposes:

Net income, dividends and taxable capital gains of the Partnership fortaxation purposes in each fiscal year will be allocated as at the last day ofsuch year to (i) the General Partner generally equal to the distributionsreceived by it payable in that year, and (ii) to Limited Partners who holdUnits at any time during such year (and in certain cases to Limited Partners

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who held Units at any time in the previous fiscal year) generally based onthe number, class and series held by such Limited Partners, the dates ofpurchase and/or redemption, the respective Net Asset Values of each classand series of Units, the fees paid or payable in respect of each class andseries of Units, distributions if any paid to the General Partner in respect ofeach class and series of Units, the tax basis of such Units, and the date ofrealization of each such item of income, gain or loss, as the case may be.The Limited Partners will be allocated 99.999% of net losses; theremaining 0.001% shall be allocated to the General Partner. See “Summaryof Limited Partnership Agreement - Allocation of Income and Loss”.

Distributions to LimitedPartners:

Distributions of allocated income may be made to Limited Partners fromtime to time at the discretion of the Investment Manager. The InvestmentManager has no current intention to make any such distributions. See“Summary of Limited Partnership Agreement – Distributions”.

Fiscal Year End: The fiscal year end of the Partnership is December 31.

Term: The Partnership has no fixed term. Dissolution may only occur on 30 dayswritten notice by the Investment Manager to each Limited Partner, or 60days following the removal of the General Partner (unless the LimitedPartners vote to appoint a replacement General Partner and continue thePartnership).

Financial Reporting: Audited financial statements will be made available to investors within 90days of each fiscal year end, unaudited financial statements within 60 daysof the end of the first six months of each year, and a monthly report of thenet asset value per Unit of each Series. See “Summary of LimitedPartnership Agreement – Reports to Limited Partners”.

Tax Considerations: Persons investing in a limited partnership such as the Partnership should beaware of the tax consequences of investing in, holding and/or redeemingUnits. Investors are urged to consult with their tax advisers todetermine the potential tax consequences of an investment in thePartnership.

Limited Liability: The liability of each Limited Partner for the debts, liabilities, obligationsand losses of the Partnership will be limited to the amount of the capitalcontributed by the Limited Partner, unless the Limited Partner takes part inthe control of the business of the Partnership. See “Summary of LimitedPartnership Agreement – Liability” and “Risk Factors”.

Release of ConfidentialInformation:

Under applicable securities and anti-money laundering legislation, theInvestment Manager is required to collect and may be required to releaseconfidential information about Limited Partners and, if applicable, aboutthe beneficial owners of corporate Limited Partners, to regulatory or lawenforcement authorities.

Risk Factors: Investors should consider a number of factors in assessing the risksassociated with investing in Units including those generally associated with

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the investment techniques used by the Investment Manager. See “RiskFactors”.

Sales Commission: There is no commission payable by the purchaser to the InvestmentManager upon the purchase of the Units, however purchasers may pay anegotiated fee if purchasing through a dealer. Subject to applicable law, theInvestment Manager may pay, out of the fees payable to the InvestmentManager by the Partnership, a negotiated referral fee or trailingcommission to dealers or other persons in connection with a sale of Units.

Legal Counsel: Borden Ladner Gervais LLP, Toronto, Ontario

Auditors: Goodman & Associates LLP


THE PARTNERSHIP

Agilith North American Diversified Fund LP (the “Partnership”) was formed under the laws ofthe Province of Ontario and became a limited partnership by filing a Declaration of Limited Partnershipunder the Limited Partnerships Act (Ontario) (the “LP Act”) on September 25, 2007. The Partnership isgoverned by a limited partnership agreement dated as of September 25, 2007 (the “Limited PartnershipAgreement”), as amended May 1, 2013, made between the General Partner and Horan Holding Inc. (the“Initial Limited Partner”). The principal place of business of the Partnership and of the general partnerof the Partnership, Agilith North American Diversified GP Inc. (the “General Partner”), is 80 RichmondStreet West, Suite 203, Toronto, Ontario. See “Summary of Limited Partnership Agreement”.

The interest of each limited partner of the Partnership (the “Limited Partner”) will represent thesame proportion of the total interest of all Limited Partners as the Net Asset Value of Units held by suchLimited Partner is of the total Net Asset Value of the Partnership.

THE GENERAL PARTNER

The General Partner was incorporated under the Business Corporations Act (Ontario) on August16, 2007. The General Partner may act as general partner of other limited partnerships, but does notpresently carry on any other business operations and currently has no significant assets or financialresources. The following are the directors and officers of the General Partner:

Name and Municipality of Residence: Office with the General Partner

Patrick Horan, CFAToronto, Ontario

President and Director

Andrea Horan, CFAToronto, Ontario

Director

In addition to the listed directors, Horan Holdings Inc., which is wholly owned and controlled bythe directors of the General Partner, holds preferred shares in the General Partner.

The General Partner may also purchase Units.

The General Partner is generally responsible for management and control of the business andaffairs of the Partnership in accordance with the terms of the Limited Partnership Agreement, however theGeneral Partner has engaged Agilith Capital Inc. (the “Investment Manager”) to carry out its duties,including management of the Partnership on a day-to-day basis, management of the Partnership’sportfolio and distribution of the Units of the Partnership. The General Partner remains responsible formonitoring the Investment Manager’s activities on behalf of the Partnership. The General Partner willreceive a share of Partnership profits. See “Profit Allocation”.

THE INVESTMENT MANAGER

The Investment Manager has been engaged to direct the day-to-day business, operations andaffairs of the Partnership, including management of the Partnership’s portfolio on a discretionary basisand distribution of the Units of the Partnership. The Investment Manager may delegate certain of theseduties from time to time. See “Investment Management Agreement”.

The Investment Manager was incorporated under the laws of the Province of Ontario on August16, 2007. The principal place of business of the Investment Manager 80 Richmond Street West, Suite203, Toronto, Ontario. The following are the directors and officers of the Investment Manager:

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Name and Municipality of Residence: Office with the Investment Manager

Patrick Horan, CFAToronto, Ontario

President and Director

Andrea Horan, CFAToronto, Ontario

Secretary, Treasurer and Director

Patrick Horan began in the investment business in 1989, spending the past decade prior to co-founding Agilith Capital in 2007, managing both mutual fund and pension fund investments with a corefocus on TMT, financial and industrial sectors. Most recently, as Senior Portfolio Manager with co-managerial responsibility for a billion dollar large cap equity fund, he consistently generated topperformance at Legg Mason Canada. Prior to this, Mr. Horan worked at Goodman & Company assistingin the management of the flagship Dynamic Power Canadian Fund as well as direct managementresponsibilities for the Dynamic Power International Fund and Dynamic Power EAFE Fund, both ofwhich achieved top decile performance under his leadership. He received his MBA from University ofToronto in 1994 and his CFA designation in 1995.

Prior to helping found Agilith Capital, Andrea Horan was a founding partner at Genuity CapitalMarkets where, as a member of the Partners Committee and Director of Research, she built and manageda department of 15 analysts. She began as an equity analyst for Canadian investment dealers in 1994providing coverage of companies in the media and communications sector and quickly received tophonours with both Brendon Woods and Greenwich institutional investor surveys during her seven yeartenure as media analyst at RBC Capital Markets. Ms. Horan went on to become a founding partner atWestwind Partners and headed the Research Department. She has been engaged to speak at a number ofindustry events, contributed to investment publications on the subject of media investments and providedexpert advice to the CRTC and the Canadian Federal Government. She received her MBA fromUniversity of Toronto in 1994 and her CFA designation in 1996.

INVESTMENT OBJECTIVES AND STRATEGIES OF THE PARTNERSHIP

Investment Objective

The investment objective of the Partnership is to provide Limited Partners with long term capitalgrowth and income through selection and management of a diverse base of equity positions in publiclyand privately traded North American issuers. The Investment Manager will assist the Partnership in theselection of investments consistent with the Partnership’s objectives.

Investment Strategy

To achieve its investment objective, the Partnership will invest in:

Under-valued securities. The Partnership may make investments in securities with valuesthat the Investment Manager believes do not reflect the underlying potential of the businessbased on fundamental research and analysis. Under-valued situations may include issuersthat are undergoing significant restructuring or improving fundamentals that are not yetreflected in the market, issuers whose valuation is lagging that of their peers or when theInvestment Manager believes the market has incorrectly assessed the risk associated with aspecific issuer.

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Growth securities. The Partnership may invest in securities with significant growth potential,including early stage companies that are not yet profitable or generating positive cash flow,but that possess a strategic or competitive advantage in a high growth sector.

Short term catalyst opportunities. The Partnership may take advantage of short term marketopportunities that result from news or events that the market has not yet reflected in theissuer’s share price. The Investment Manager believes that the relative size of the Partnershipwill give the Partnership an advantage in executing on this strategy.

Paired trades. From time to time, the Partnership may assume short positions in securities,while assuming a long position of another issuer in an attempt to benefit from disparities inrelative valuation.

Derivatives. From time to time, the Partnership may invest in put and call options that haveequity securities as the underlying security. The option strategy may be to limit losses orenhance gains.

Through extensive industry experience and a thorough analysis of fundamentals combined withselective quantitative and technical analysis, the Investment Manager possesses a competitive advantagewith respect to the identification of market opportunities. The Partnership believes that its size allows it totake advantage of less liquid market opportunities where larger funds are a trading disadvantage.

Although the Partnership does not intend to utilize significant leverage, it has no restriction ondoing so to a maximum of 100% in the aggregate (at the time of leverage) of the Net Asset Value of thePartnership. The Partnership may borrow or purchase securities on margin. The Partnership may takeshort sale positions and write uncovered options to enhance returns.

Risk Management

The Investment Manager follows several strategies with regard to managing risk and volatilitywithin the Partnership:

1. The Investment Manager will ensure that the Partnership’s investment in a public issuer does notrepresent more than 10% of outstanding shares or votes attached to outstanding securities. If thePartnership acquires a security other than as the result of a purchase and the acquisition results inthe Partnership exceeding the 10% limit described in this paragraph, the Partnership shall, asquickly as is commercially reasonable (and in any event within 90 days of the acquisition), reduceits holdings of those securities so that it does not hold securities exceeding such limits.

2. The Investment Manager will run scenario analysis to test the portfolio sensitivity to event risk.

3. The Partnership will not purchase any physical commodity, or derivatives whose underlyingsecurity is a physical commodity.

4. The Partnership will not lend cash or guarantee securities or obligations of any other person (butmay enter into a securities lending program).

Use of Leverage and Restrictions

The Partnership does not anticipate using leverage of more than 35% (exclusive of shortpositions) of the Net Asset Value of the Partnership on a routine basis. The Partnership will seek to attainits objective of capital growth primarily through the investment of undervalued securities or thosesecurities with superior growth prospects.

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Cash Positions

The Investment Manager may hold cash in short term debt instruments, money market funds orsimilar temporary investments pending full investment of the Partnership’s capital and at any timedeemed appropriate by the Investment Manager.

Short Positions

The Partnership may not commit more than 60% of its equity to short positions. The InvestmentManager anticipates that short positions will rarely exceed 40% of the Net Asset Value of the Partnership.

The Partnership will seek to sell securities which are believed to be extremely overvalued andwhere a catalyst has been identified to realize this value over the medium term.

The Partnership will short-sell companies and industries which are overvalued with respect to abusiness’ growth and projected prospects and which may face financial distress, competitive pressure orfraud.

Investment Restrictions

The Partnership may not place more than 20% of its portfolio, as measured in cost, in any singlelong or short position. If at any time more than 20% of the Net Asset Value consists of securities of anyone issuer, the Partnership will, as quickly as is commercially reasonable (and in any event within 90 daysafter such limit is exceeded) take all necessary steps to reduce the percentage of Net Asset Valuerepresented by such securities to 20% or less.

Although the Partnership does not expect to employ leverage of more than 35% (exclusive ofshort positions) of the Net Asset Value of the Partnership over the long term, it may borrow or employother forms of leverage in an aggregate amount not to exceed 100% of the Net Asset Value of thePartnership at the time of borrowing or other transactions entered into.

General

There can be no assurances that the Partnership will achieve its investment objective.

The Investment Manager may at any time adopt new strategies or deviate from the foregoingguidelines as market conditions dictate. In the event of any material deviation from its current intendedstrategies, the Investment Manager will advise the Limited Partners in writing. While the InvestmentManager typically will try to minimize risk in selecting investments, it should be understood that the riskmanagement techniques utilized by the Investment Manager cannot provide any assurance that thePartnership will not be exposed to risks of significant investment losses. Please refer to “Risk Factors” formore information

Statutory Caution

The foregoing disclosure of the Investment Manager’s investment strategies and intentions mayconstitute “forward-looking information” for the purpose of Ontario securities legislation, as it containsstatements of the Investment Manager’s intended course of conduct and future operations of thePartnership. These statements are based on assumptions made by the Investment Manager of the successof its investment strategies in certain market conditions, relying on the experience of the InvestmentManager’s officers and employees and their knowledge of historical economic and market trends.Investors are cautioned that the assumptions made by the Investment Manager and the success of itsinvestment strategies are subject to a number of mitigating factors. Economic and market conditions maychange, which may materially impact the success of the Investment Manager’s intended strategies as well

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as its actual course of conduct. Investors are urged to read “Risk Factors” below for a discussion of otherfactors that will impact the operations and success of the Partnership.

THE OFFERING

Units offered hereby are being offered to investors resident in Ontario, Quebec, Manitoba,Alberta and British Columbia pursuant to exemptions from prospectus and registration requirementscontained in National Instrument 45-106 – Prospectus and Registration Exemptions (“NI 45-106”). Threeclasses of Units, issuable in series, are currently being offered: Class A Units are available to all investorswho meet the minimum investment criteria. Class I Units will only be issued to certain institutionalinvestors. Class A Units and Class I Units are subject to management fees (see “Investment ManagementAgreement” below) and share profits with the General Partner (see “Profit Allocation” below). Class MUnits will generally only be issued to associates and affiliates of the Investment Manager and itsdirectors, officers and employees. No management fee will be payable in respect of Class M Units, norwill a holder of Class M Units share profits with the General Partner. A new series of Units in each classwill be issued on each successive Valuation Date on which Units are issued.

Subscriptions will be accepted on a monthly basis, being on the last business day in each monthor such other date as the Investment Manager may permit (each, a “Valuation Date”), subject to theInvestment Manager’s discretion to refuse subscriptions in whole or in part, provided a duly completedSubscription and subscription proceeds are received by the Investment Manager by 4:00 p.m. on therelevant Valuation Date. Units will be issued on the business day following the Valuation Date on whichthe subscription is accepted. The Investment Manager intends to fix an opening net asset value of $1,000per Unit for each new series.

The offering is restricted to persons who have the capacity and competence to enter into and bebound by the Limited Partnership Agreement.

There is no commission payable by a purchaser to the Investment Manager upon the purchase ofthe Units. Subscribers may pay negotiated commissions to their dealers.

MINIMUM INDIVIDUAL SUBSCRIPTIONS

The minimum initial investment is $150,000 but may be reduced to $50,000 for accreditedinvestors (or to such lesser amount as may be accepted by the Investment Manager).

Each additional investment must be not less than $10,000 and, for investors other than investorsin Alberta who initially acquired Units of the Partnership under the minimum amount exemption, at thetime of issuance of the additional investment, the Units held by the investor must have an acquisition costor a Net Asset Value equal to at least $150,000. At the time of making each additional investment, unlessa new Subscription is executed, each investor will be deemed to have repeated and confirmed to theInvestment Manager the covenants and representations contained in the Subscription delivered by theinvestor to the Investment Manager at the time of the initial investment. Subsequent additionalinvestments are subject to acceptance or rejection by the Investment Manager.

These minimums are net of any front end commissions paid by an investor to his or heragent.

WHO SHOULD INVEST

The Partnership is designed to attract investment capital which is surplus to an investor’s basicfinancial requirements.

The following persons and entities may not invest in this Partnership:

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(a) “non-residents”, partnerships other than “Canadian partnerships”, “tax shelters”, “taxshelter investments”, or any entities an interest in which is a “tax shelter investment”, orin which a “tax shelter investment” has an interest, within the meaning of the Income TaxAct (Canada) (the “ITA”); and

(b) a partnership which does not have a prohibition against investment by the foregoingpersons.

By purchasing Units, a Limited Partner represents and warrants that he, she or it is not one of theabove and shall indemnify and hold harmless the Partnership and each other Limited Partner for anycosts, damages, liabilities, expenses or losses suffered or incurred by the Partnership or such otherLimited Partner, as the case may be, that result from or arise out of a breach of such representation andwarranty. Any Limited Partner who fails to provide evidence satisfactory to the Investment Manager ofsuch status when requested to do so from time to time may be removed as a Limited Partner by theredemption of his Units in accordance with the Limited Partnership Agreement.

Any Limited Partner purchasing pursuant to this Offering Memorandum whose status changes inregard to the above shall be deemed to have ceased to be a Limited Partner (for all purposes other thantaxation and liability) immediately prior to the date on which such status changes and shall thereafter onlybe entitled to receive from the Partnership an amount equal to the lesser of the Net Asset Value of suchLimited Partner’s Units as at the date on which he or she ceases to be a Limited Partner and the Net AssetValue of such Units as at the date the Investment Manager learns that such Limited Partner’s status haschanged, less all such deductions as provided in the Limited Partnership Agreement as if such LimitedPartner voluntarily redeemed his or her Units.

In addition, any Limited Partner purchasing pursuant to this Offering Memorandum that is orbecomes a “financial institution” within the meaning of Section 142.2 of the ITA (as same may beamended or replaced from time to time) shall disclose such status to the Investment Manager at the timeof subscription (or when such status changes) and the Investment Manager may restrict the participationof any such Limited Partner or require any such Limited Partner at any time to redeem all or some of suchLimited Partner’s Units. A Limited Partner who fails to identify itself as a financial institution shallindemnify and hold harmless the Partnership and each other Limited Partner for any costs, damages,liabilities, expenses or losses suffered or incurred by the Partnership or such other Limited Partner, as thecase may be, that result from or arise out of such failure. Any Limited Partner who is or who becomes afinancial institution after becoming a Limited Partner will (if the Investment Manager determines it wouldbe prejudicial to the Partnership and the other Limited Partners not to) be deemed to have, immediatelyprior to the date on which it becomes a financial institution (or the date of issue of Units to such financialinstitution, whichever is later), redeemed some or all of such Limited Partner’s Units to the extentnecessary to result in financial institutions owning in the aggregate Units having a Net Asset Value that isless than one-half of the Net Asset Value of all of the Units, and shall be entitled to receive from thePartnership as redemption proceeds an amount equal to the lesser of the Net Asset Value of suchredeemed Units as at the date on which it is deemed to have redeemed such Units and the Net Asset Valueof such Units as at the date the Investment Manager learns that such Limited Partner is a financialinstitution, less all such deductions as provided in the Limited Partnership Agreement as if such LimitedPartner voluntarily redeemed its Units.

SUBSCRIPTIONS

Subscriptions for Units must be made by completing and executing the subscription form andpower of attorney (the “Subscription”) provided by the Investment Manager and by forwarding to theInvestment Manager such form together with a cheque (or other form of funds transfer acceptable to theInvestment Manager) representing payment of the subscription price. Subscription funds provided prior toa Valuation Date will be kept in a segregated account. The Investment Manager may in its discretion

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accept subscription payments in kind, provided the assets so tendered fall within the Partnership’sinvestment strategies (such assets to be valued in the same manner as the Partnership’s other portfolioassets). Subscriptions for Units are subject to acceptance or rejection in whole or in part by the InvestmentManager in its sole discretion. In the event a subscription for Units is rejected, any subscription fundsforwarded by the subscriber will be returned without interest or deduction. Purchasers may forwardcompleted subscriptions directly to the Investment Manager.

The Limited Partnership Agreement and the Subscription (required to be executed by an investor)include an irrevocable power of attorney authorizing the General Partner on behalf of the holder of theUnit to execute the Limited Partnership Agreement, and any amendments thereto, and all otherinstruments necessary to reflect the formation of, amendment to or dissolution of the Partnership or theregistration of the Partnership in any jurisdiction as well as any elections, determinations or designationsunder the ITA or other taxation legislation or laws of like import with respect to the affairs of thePartnership or a Limited Partner’s interest in the Partnership.

Prospectus Exemptions

Units are being sold under available exemptions from the prospectus and registrationrequirements under NI 45-106, which has been adopted by the securities regulatory authorities in each ofOntario, Quebec, Manitoba, Alberta and British Columbia. The Units are being distributed only toinvestors (a) who are “accredited investors” as defined in NI 45-106, (b) except in Alberta, who invest aminimum of $150,000 in the Partnership (the “Minimum Amount Exemption”), or (c) to whom Unitsmay otherwise be sold. Purchasers will be required to make certain representations in the Subscriptionand the General Partner and Investment Manager will rely on such representations to establish theavailability of the exemptions from prospectus requirements described above. Investors, other thanindividuals, that are not accredited investors, or are accredited investors solely on the basis that they havenet assets of at least $5,000,000, must also represent to the Investment Manager (and may be required toprovide additional evidence at the request of the Investment Manager to establish) that such investor wasnot formed solely in order to make private placement investments which may not have otherwise beenavailable to any persons holding an interest in such investor. The so-called “Offering MemorandumExemption” is not being relied on, nor is the Minimum Amount Exemption being relied on inAlberta, and investors do not have the benefit of certain additional protections that NI 45-106 givesto investors when an issuer relies on the Offering Memorandum Exemption.

No subscription will be accepted unless the Investment Manager is satisfied that the subscriptionis in compliance with applicable securities laws.

Accredited Investors

The Investment Manager has determined that the minimum investment for persons who meet thedefinition of “accredited investor” (as defined in NI 45-106) is $50,000. A list of accredited investors isset out in the Subscription delivered with this Offering Memorandum, but generally includes individualswho have net investment assets of at least $1,000,000, or personal income of at least $200,000 orcombined spousal income of at least $300,000 (in the previous two years with reasonable prospects ofsame in the current year).

Know-Your-Client and Suitability

Whether the subscriber for Units is purchasing through their own dealer or directly from theInvestment Manager (in its capacity as an exempt market dealer), the dealer through whom the Units arepurchased has an obligation under applicable securities laws to determine suitability of the investment forsuch purchaser, unless the purchaser is a “permitted client” and either waives such requirement or thedealer is otherwise exempt from such requirement. Subscribers purchasing directly from the Investment

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Manager will be required to provide certain information in the Subscription (referred to as know-your-client information) on which the Investment Manager will rely in determining such suitability.

Leverage Disclosure Statement (Using Borrowed Money to Purchase Units)

The use of leverage may not be suitable for all investors. Using borrowed money to finance thepurchase of securities involves greater risk than using cash resources only. If an investor borrows moneyto purchase Units, the investor’s responsibility to repay the loan and pay interest as required by the termsof the loan remains the same even if the value of the Units purchased declines. Furthermore, there may benegative tax consequences for an investor who borrows money to purchase Units.

REDEMPTIONS

A Limited Partner shall be entitled to redeem Units as at a Valuation Date that falls on the lastbusiness day of each month, or such other date as the Investment Manager in its absolute discretion maydetermine (each a “Redemption Date”). Redemption requests will only be considered if the InvestmentManager receives a written request for such redemption at least 30 days prior to the proposed RedemptionDate.

Upon redemption of a Unit, the Limited Partner will receive proceeds of redemption equal to theNet Asset Value of such Unit as at the close of business on the designated Redemption Date. ThePartnership will deduct and retain an amount of up to 5% of the Net Asset Value of Units tendered forredemption, if those Units are redeemed within 90 days of purchase, or up to 2% of the Net Asset Valueof such Units if those Units are tendered for redemption within 1 year of purchase, to compensate thePartnership for costs associated with taking new investors into the Partnership and disposition expensesincurred by the Partnership to enable the redemption. If a redeeming Limited Partner owns Units of morethan one series within a single class, Units will be redeemed on a “first-in, first-out” basis, meaning thatUnits of the earliest series of the applicable class owned by the Limited Partner will be redeemed first, atthe redemption price for Units of such series, until such Limited Partner no longer owns Units of suchseries (although this policy may be amended depending on tax considerations). Notwithstanding theforegoing, if a Unitholder holds both Class A Units and Class I Units, Class I Units will beredeemed first (but there will be no early redemption deduction in respect of such Units if Class AUnits held by that Unitholder have been outstanding for more than the stipulated holding period).If Units are redeemed on a Redemption Date that is not the last business day of a fiscal year, the GeneralPartner may receive a distribution from the Partnership and the amount of such distribution will bededucted from the redemption proceeds otherwise payable to the Limited Partner (see “Summary ofLimited Partnership Agreement - Distributions”).

The Investment Manager shall have the right to hold back up to 10% of the redemption pricepayable to redeeming holders of Units in respect of any Redemption Date to provide an orderlydisposition of the Partnership’s assets to pay the redemption price payable per Unit to such LimitedPartners. Payment of any amount held back shall be made in accordance with the Partnership Agreementas soon as reasonably practicable. If, in respect of any Redemption Date, the Investment Manager hasreceived requests to redeem Units representing 10% or more of the Net Asset Value of the Partnership,redemption may be deferred until the Redemption Date next following such Redemption Date. Suchdeferral may take place if, in the sole judgement of the Investment Manager, such extra time is warrantedto facilitate the orderly liquidation of the Partnership’s assets to meet such redemptions. In such event, theredemption price per Unit will be equal to the Net Asset Value of such Units on such subsequentRedemption Date.

The Investment Manager will advise the Limited Partners who have requested a redemption ifredemptions will be limited or suspended on a requested Redemption Date. Redemption requests whichare rejected as at a Redemption Date will be accepted on the next Redemption Date on which redemption

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requests are honoured in priority to redemption requests made after the deadline for redemption requestsin respect of such earlier Redemption Date. Partial redemptions on a Redemption Date will be made on apro rata basis. Redemption requests are irrevocable unless they are not honoured on a Redemption Date,in which case they may be withdrawn within 15 days following such Redemption Date.

The Investment Manager has the right to require a Limited Partner to redeem some or all of theUnits owned by such Limited Partner on a Redemption Date designated by the Investment Manager at theNet Asset Value per Unit thereof, by notice in writing to the Limited Partner given at least 30 days beforethe designated Redemption Date, which right may be exercised by the Investment Manager in its absolutediscretion.

TRANSFER OR RESALE

As the Units offered by this Offering Memorandum are being distributed pursuant to exemptionsfrom the prospectus requirements of applicable securities legislation, the resale of these securities byinvestors is subject to restrictions. An investor should refer to applicable provisions in consultation with alegal adviser. Furthermore, no transfers of Units may be effected unless the Investment Manager, in itssole discretion, approves the transfer and the proposed transferee. There is no market for these Units andno market is expected to develop, therefore it may be difficult or even impossible for the purchaser to sellthe Units.

Subscribers are advised to consult with their legal advisers concerning restrictions on resale andare further advised against reselling their Units until they have determined that any such resale is incompliance with the requirements of applicable legislation and the Limited Partnership Agreement.

NET ASSET VALUE

The Net Asset Value of the Partnership and the Net Asset Value Per Unit of each class and seriesof Units will be determined as of 4:00 p.m. (Toronto time) on the last business day of each month (each a“Valuation Date”) by the Investment Manager or by a third party engaged by the Investment Managerfor that purpose (the “NAV Administrator”) in accordance with the Limited Partnership Agreement.

The Net Asset Value of each series will generally increase or decrease proportionately with theincrease or decrease in the Net Asset Value of the Partnership (before deduction of class-specific andseries-specific fees and expenses), and the Net Asset Value per Unit shall be determined (after deductionof class-specific and series-specific fees and expenses) by dividing the Net Asset Value of each series bythe number of Units of such series outstanding.

Valuation Principles

The value of the assets and the amount of the liabilities of the Partnership shall be calculated insuch manner as the NAV Administrator, shall determine from time to time, subject to the following:

(a) The value of any cash on hand or on deposit, bills, demand notes, accounts receivable,prepaid expenses, dividends receivable (if such dividends are declared and the date ofrecord is before the date as of which the Net Asset Value of the Partnership is beingdetermined) and interest accrued and not yet received, shall be deemed to be the fullamount thereof, unless the NAV Administrator determines that any such deposit, bill,demand note, account receivable, prepaid expense, dividend receivable or interestaccrued and not yet received is not worth the full amount thereof, in which event thevalue thereof shall be deemed to be such value as the NAV Administrator determines tobe the reasonable value thereof.

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(b) The value of any security which is listed or dealt in upon a public securities exchangewill be valued at the last available trade price on the Valuation Date or, if the ValuationDate is not a business day, on the last business day preceding the Valuation Date. If nosales are reported on such day, such security will be valued at the average of the currentbid and asked prices. If the closing price is outside of the closing bid-ask range, then theclosest bid or ask to the last trade will be used. Securities that are listed or traded on morethan one public securities exchange or that are actively traded on over-the-countermarkets while being listed or traded on such securities exchanges or over-the-countermarkets will be valued on the basis of the market quotation which, in the opinion of theNAV Administrator, most closely reflects their fair value.

(c) Any securities which are not listed or dealt in upon any public securities exchange will bevalued at the simple average of the latest available offer price and the latest available bidprice (unless in the opinion of the NAV Administrator such value does not reflect thevalue thereof and in which case, the latest offer price or bid price as best reflects thevalue thereof should be used), as at the Valuation Date.

(d) The value of any restricted security shall be the lesser of (i) the value thereof based onany available reported quotations in common use and (ii) that percentage of the marketvalue of securities of the same class, the trading of which is not restricted or limited byreason of any representation, warranty or agreement or by law, equal to the percentagethat the acquisition cost thereof was of the market value of such securities at the time ofacquisition thereof.

(e) Securities held in private issuers are recorded at cost unless an upward adjustment isconsidered appropriate and supported by persuasive and objective evidence such as asignificant equity financing by an unrelated investor at a transaction price higher than thevaluation price. Downward adjustments to valuation price are made when there isevidence of other than a temporary decline in value as indicated by the assessment of thefinancial condition of the investment based on third-party financing, operational results,forecasts, and other developments since the previous valuation price was established.Options and warrants held in private issuers are carried at cost unless there is an upwardor downward adjustment of the underlying privately-held company supported bypersuasive and objective evidence such as significant subsequent equity financing by anunrelated investor at a transaction price higher or lower than the valuation price.

(f) All Partnership property valued in a foreign currency and all liabilities and obligations ofthe Partnership payable by the Partnership in foreign currency shall be converted intoCanadian funds by applying the rate of exchange obtained from the best available sourcesby the NAV Administrator to calculate Net Asset Value.

(g) Each transaction of purchase or sale of portfolio securities effected by the Partnershipwill be reflected in the computation of the Net Asset Value of the Partnership on the tradedate.

(h) The value of any security or property to which, in the opinion of the NAV Administrator,the above principles cannot be applied (whether because no price or yield equivalentquotations are available or for any other reason), shall be the fair value thereofdetermined in such manner as the NAV Administrator may from time to time determinebased on standard industry practice.

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(i) Short positions will be marked-to-market, i.e. carried as a liability equal to the cost ofrepurchasing the securities sold short applying the same valuation techniques describedabove.

(j) All other liabilities shall include only those expenses paid or payable by the Partnership,including accrued contingent liabilities; however expenses and fees allocable only to aclass and series of Units shall not be deducted from the Net Asset Value of thePartnership prior to determining the Net Asset Value of each class and series, but shallthereafter be deducted from the Net Asset Value so determined for each such class andseries.

The Investment Manager may determine such other rules as it deems necessary from time to time,which rules may deviate from Canadian generally accepted accounting principles (“GAAP”).

Net asset value calculated in this manner will be used for the purpose of calculating theInvestment Manager’s (and other service providers’) fees and the General Partner’s distributions and willbe published net of all paid and payable fees and distributions. Such Net Asset Value will be used todetermine the subscription price and redemption value of Units. To the extent that such calculations arenot in accordance with GAAP, the financial statements of the Partnership will include a reconciliationnote explaining any difference between such published Net Asset Value and Net Asset Value for financialstatement reporting purposes (which must be calculated either in accordance with GAAP).

INVESTMENT MANAGEMENT AGREEMENT

In order to set out the duties of the Investment Manager, the Partnership has entered into anInvestment Management Agreement (the “Investment Management Agreement”) with the InvestmentManager first dated September 25, 2007, as amended and restated as of September 28, 2009 and furtheramended May 1, 2013 and May 16, 2013. Pursuant to the Investment Management Agreement, theInvestment Manager directs the business, operations and affairs of the Partnership and provides day-to-day management services to the Partnership, including management of the Partnership’s portfolio on adiscretionary basis and distribution of the Units of the Partnership, and such other services as may berequired from time to time. The General Partner has assigned its powers and obligations under theLimited Partnership Agreement to the Investment Manager to the extent necessary to permit theInvestment Manager to carry out its duties under the Management Agreement. The Investment Managermay delegate certain of these duties from time to time.

Pursuant to the Investment Management Agreement, the Investment Manager shall be paid amonthly management fee (the “Management Fee”) on the last business day of each month equal to 1/12of 2% of the aggregate Net Asset Value of the Class A Units, plus 1/12 of 0.75% of the aggregate NetAsset Value of the Class I Units, on such date. No Management Fee is payable in respect of Class MUnits. Management Fees payable by the Partnership are subject to HST and will be deducted as anexpense of the Partnership in the calculation of the net asset value of the Partnership.

The Investment Management Agreement may be terminated by either the General Partner or theInvestment Manager on 30 days notice to the other, or immediately in the event of the dissolution orinsolvency or bankruptcy of the other party or the termination of the Limited Partnership Agreement.

PROFIT ALLOCATION

The General Partner will share in the net profits of the Partnership by receiving distributions onthe last Valuation Date in each year and upon the redemption of a Unit based on the increase, if any, inthe Net Asset Value of such Unit. In respect of Class A Units, such distributions are equal to 20% of theincrease, if any, in the Net Asset Value of each such Unit over the applicable High Water Mark (defined

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below) of such Unit, subject to the holder of the Class A Unit achieving the Minimum Return (as definedbelow). In respect of the Class I Units, such distributions equal 14% of the increase, if any, in the NetAsset Value of each such Unit over the applicable High Water Mark of such Unit, subject to the holder ofClass I Unit achieving the Minimum Return. The General Partner will not receive distributions in respectof Class M Units. Limited Partners will effectively share in net profits and net losses of the Partnershipby increases or decreases in the Net Asset Value of their Units on the following basis:

(a) in respect of a Class A Unit, (i) any increase in Net Asset Value of such Unit up to theMinimum Return first accrues to the benefit of the holder of such Unit, (ii) any increase in such Net AssetValue of the Unit in excess of the Minimum Return, to a maximum of the Class A Catch-up Return (asdefined below), shall be distributed to the General Partner, and (iii) any increase in such Net Asset Valuein excess of the Minimum Return plus Class A Catch-up Return will accrue as to 80% to the holder of theUnit and the remaining 20% will be distributed to the General Partner;

(b) in respect of a Class I Unit, (i) any increase in Net Asset Value of such Unit up to theMinimum Return first accrues to the benefit of the holder of such Unit, (ii) any increase in such Net AssetValue of the Unit in excess of the Minimum Return, to a maximum of the Class I Catch-up Return (asdefined below), shall be distributed to the General Partner, and (iii) any increase in such Net Asset Valuein excess of the Minimum Return plus Class I Catch-up Return will accrue as to 86% to the holder of theUnit and the remaining 14% will be distributed to the General Partner; and

(c) in respect of a Class M Unit, any increase in Net Asset Value of any such Unit accrues tothe benefit of the holder of such Unit and no distribution is payable to the General Partner.

Any distribution paid to the General Partner will be deducted from the Net Asset Value (orredemption proceeds, as the case may be) of the respective Unit.

“High Water Mark” for a Unit as at any date means, initially, its subscription price, andthereafter shall be adjusted from time to time to equal its Net Asset Value immediately following thepayment of an incentive distribution to the General Partner in respect of such Unit.

“Minimum Return” for a Unit is the amount equal to the High Water Mark of such Unitmultiplied by a rate of 6% per annum, calculated monthly from the date as of which the High Water Markwas established to and including the date on which the Minimum return is being calculated.

“Class A Catch-up Return” for a Unit is the amount equal to the High Water Mark of such Unitmultiplied by a rate of 1.5% per annum, calculated monthly from the date as of which the High WaterMark was established to and including the date on which the Minimum return is being calculated.

“Class I Catch-up Return” for a Unit is the amount equal to the High Water Mark of such Unitmultiplied by a rate of 0.98% per annum, calculated monthly from the date as of which the High WaterMark was established to and including the date on which the Minimum return is being calculated.

SUMMARY OF LIMITED PARTNERSHIP AGREEMENT

The rights and obligations of the Limited Partners and of the General Partner are governed by theLimited Partnership Agreement (as amended from time to time) and the LP Act. The following is asummary of the Limited Partnership Agreement entered into by the General Partner and the InitialLimited Partner. This summary is not intended to be complete and each investor should carefullyreview the Limited Partnership Agreement itself for full details of these provisions.

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Authority and Duties of the General Partner

The General Partner has the full power and authority to do such acts and things and to executeand deliver such documents as it considers necessary or desirable in connection with the offering and saleof the Units and for carrying on the activities of the Partnership for the purposes described herein and inthe Limited Partnership Agreement.

The General Partner shall exercise the powers and discharge its duties honestly, in good faith, andwith a view to the best interests of the Partnership and in connection therewith shall exercise the degree ofcare, diligence and skill that a reasonably prudent person would exercise in comparable circumstances.See Article 6 - Management of Limited Partnership in the Limited Partnership Agreement.

The General Partner has assigned its powers and obligations under the Limited PartnershipAgreement to the Investment Manager to the extent necessary to permit the Investment Manager to carryout its duties under the Management Agreement. However the Investment Manager is not and is notintended to be a Partner. This summary reflects the assignment of powers, obligations and authority bythe General Partner to the Investment Manager.

The Units

The Partnership may issue an unlimited number of Units. Units may be designated by theInvestment Manager as being Units of a series, and the opening Net Asset Value of each such series maybe determined by the Investment Manager. Each issued and outstanding Unit of a series shall be equal toeach other Unit of the same series with respect to all matters. The respective rights of the holders of Unitsof each series will be proportionate to the Net Asset Value of such series relative to the Net Asset Valueof each other series. Each Unit carries with it a right to vote, with one vote for each $1.00 of Net AssetValue attributed to such Unit (the Net Asset Value of all Units held by a Limited Partner shall beaggregated for the purpose of determining voting rights.) Fractional Units may be issued. A personwishing to become a Limited Partner shall subscribe for Units by means of a subscription form and powerof attorney. The acceptance of any such subscription in whole or in part shall be subject to the InvestmentManager in its sole discretion. See Article 3 - The Units in the Limited Partnership Agreement.

On the first closing, Units designated by the Investment Manager as Series 1 Units will be issuedat a Net Asset Value per Unit of $1,000. On each successive Valuation Date on which Units are issued, anew series of Units will be issued at a Net Asset Value per Unit to be determined by the InvestmentManager (the Investment Manager’s current policy is to issue Units of each new series at an opening netasset value of $1,000). All changes in Net Asset Value (i.e. all income and expenses, and all unrealizedgains and losses) of the Partnership shall be borne proportionately by each class and series of Units basedon their respective Net Asset Values, except as follows: (i) subscription proceeds received by thePartnership in respect of a series of Units shall accrue to the Net Asset Value of such series; (ii) allredemption proceeds paid out by the Partnership in respect of a Unit of a series shall be deducted from theNet Asset Value of such series; (iii) the management fee and redemption fee payable to the InvestmentManager in respect of a Unit of a series shall be deducted from the Net Asset Value of such series and (iv)any other expenses and any distributions paid to the General Partner that are allocable to a specific classor series shall be deducted only from the Net Asset Value of that class or series. The Net Asset Value perUnit of each class and series shall be calculated by dividing the Net Asset Value of such respectiveclasses and series by the number of Units of such classes and series then outstanding.

The Investment Manager may in its discretion create different classes of Units. Each class may besubject to different management fees, may have a different profit-sharing arrangement with the GeneralPartner, and may have such other features as the Investment Manager may determine. As at the datehereof, four classes of Units (the Class A Units, the Class S Units, the Class I Units and the Class MUnits) have been created, having the attributes described in this Offering Memorandum (Class S Units are

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no longer offered for sale but now have the same attributes as the Class A Units). The InvestmentManager may redesignate a Limited Partner’s Units from one class to another (and amend the number ofsuch Units so that the Net Asset Value of the Limited Partner’s aggregate holdings remains unchanged)and will do so in accordance with the Limited Partnership Agreement. The Investment Manager also hasthe discretion to subdivide or consolidate Units of one or more series from time to time, in a mannerdifferent than other series.

Units of a series of any Class may from time to time be consolidated or subdivided, andredesignated by the Investment Manager as Units of another series or renamed such that they have thesame name as another series of the same class, with the consolidation/subdivision ratio based on theirrespective Net Asset Values per Unit, if (i) the High Water Mark for the first such series is equal to theNet Asset Value per Unit for such first series and the High Water Mark for the second series is equal tothe Net Asset Value per Unit of such second series, or (ii) the ratio of the High Water Mark to the NetAsset Value per Unit for each such series is identical. (For the definition of “High Water Mark”, see“Profit Allocation” above.)

Allocation of Income and Loss

Income and loss for taxation purposes, as well as taxable capital gains and allowable losses, of thePartnership in each fiscal year will generally be allocated to the Partners according to the followingguidelines:

(i) Limited Partners who redeemed Units in the year will be allocated a portion of incomeand taxable capital gains as will result in such Limited Partners having an adjusted costbase for such redeemed Units as near as possible (but not exceeding) redemptionproceeds thereof;

(ii) the General Partner will be allocated a portion of income, dividends and taxable capitalgains in a total amount generally equal to the distributions received by the GeneralPartner payable in such year (the General Partner may choose to receive some or all ofthe distributions received by it in a year as a loan, which amount shall be payable as adistribution in the next following year);

(iii) Limited Partners will be allocated the remaining income, dividends and taxable capitalgains based on the number, class and series of Units held by such Limited Partners, thedates of purchase and/or redemption, the respective Net Asset Values of each class andseries of Units, the tax basis of such Units, the fees paid or payable and distributionspayable to the General Partner in respect of each class and series of Units, and the dateof realization of each such item of income, gain or loss, among other factors deemed bythe Investment Manager to be relevant; and

(iv) net losses will be allocated as to (i) 0.001%, to the General Partner, and (ii) 99.999%, toLimited Partners who hold Units at any time during such year (and in certain cases toLimited Partners who held Units at any time in the previous fiscal year).

The Investment Manager may adopt and amend an allocation policy from time to timeintended to fairly and equitably allocate income or loss in the circumstances. See “Section4.7 - Allocations in the Limited Partnership Agreement”.

Distributions

The General Partner will receive distributions from the Partnership based on the increase in theNet Asset Value of each Unit on the last Valuation Date in each year and upon the redemption of such

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Unit, as more fully described above under “Profit Allocation”. Such distributions will be deducted fromthe Net Asset Value of such Unit (or, in the case of a redemption, from the redemption proceeds). TheGeneral Partner will not be required to repay any distributions if distributions received on a redemption ofUnits in a fiscal year exceed the Partnership’s net profits in that year.

Net profit of the Partnership allocated to the Partners for any fiscal period may be distributed inwhole or in part from time to time or at any time in the sole discretion of the Investment Manager. Nopayment may be made to a Limited Partner from the assets of the Partnership if the payment wouldreduce the assets of the Partnership to an insufficient amount to discharge the liabilities of the Partnershipto persons who are not the General Partner or a Limited Partner.

Redemptions

Redemption rights are described above under the heading “Redemptions”. Also, seeArticle 5 - Redemption in the Limited Partnership Agreement.

Expenses

The Partnership is responsible for all costs incurred by it in connection with the activities of thePartnership, including but not limited to:

(a) administrative fees and expenses of the Partnership, which include the InvestmentManager’s fees, accounting and legal costs, insurance premiums, custodial fees, registrarand transfer agency fees and expenses, Limited Partner communication expenses,organizational expenses, the cost of maintaining the Partnership’s existence andregulatory fees and expenses, and all reasonable extraordinary or non-recurring expenses;and

(b) fees and expenses relating to the Partnership’s portfolio investments, including the cost ofsecurities, interest on borrowings and commitment fees and related expenses payable tolenders and counterparties, brokerage fees, commissions and expenses, and banking fees.

To the extent that such expenses are borne by the General Partner or Investment Manager, theGeneral Partner or Investment Manager, as the case may be, shall be reimbursed by the Partnership fromtime to time. Expenses attributable to a particular class or series of Units will be deducted from the NetAsset Value of such class or series. See Section 6.2 – Expenses in the Limited Partnership Agreement.

Power of Attorney

The Limited Partnership Agreement contains a limited power of attorney in favour of the GeneralPartner in connection with all matters related to the operation of the Partnership, and authorizes theGeneral Partner to, for example, execute documents on behalf of each Limited Partner (including taxelections and amendments to the Limited Partnership Agreement). See Section 6.4 – Power of Attorney inthe Limited Partnership Agreement.

Management Fees

The Partnership may pay to the Investment Manager such fees, in such amounts and at suchintervals, as the General Partner and the Investment Manager may agree to from time to time. All suchfees are described above under “Investment Management Agreement”. See Section 7.2 –Fees in theLimited Partnership Agreement.

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Liability

Subject to the provisions of the LP Act, the liability of each Limited Partner for the liabilities andobligations of the Partnership is limited to the amount the Limited Partner contributes or agrees in writingto contribute to the Partnership, less any such amounts properly returned to the Limited Partner. ALimited Partner may lose his, her or its status as a limited partner and the benefit of limited liability ifsuch Limited Partner takes part in the control of the business of the Partnership or if certain otherprovisions of the LP Act are contravened.

Where a Limited Partner has received the return of all or part of the Limited Partner’s“Contributed Capital” (as defined in the Limited Partnership Agreement), the Limited Partner isnevertheless liable to the Partnership or, following the dissolution of the Partnership, to its creditors forany amount, not in excess of the amount returned with interest (calculated at a rate per annum equal to theprime commercial lending rate of the Partnership’s bankers), necessary to discharge the liabilities of thePartnership to all creditors who extended credit or whose claims otherwise arose before the return of theContributed Capital. Furthermore, if after a distribution the Investment Manager determines that aLimited Partner was not entitled to all or some of such distribution, the Limited Partner shall be liable tothe Partnership to return the portion improperly distributed, together with interest at a rate per annumequal to the prime commercial lending rate of the Partnership’s bankers if repayment of such excessamount is not made by the Limited Partner within fifteen (15) days of receiving notice of suchoverpayment. The Investment Manager may set off and apply any sums otherwise payable to a LimitedPartner against such amounts due from such Limited Partner, provided that there shall be no right of set-off against a Limited Partner in respect of amounts owed to the Partnership by a predecessor of suchLimited Partner. See Section 4.12 - Repayments and Section 8.2 - Limited Liability of Limited Partnersin the Limited Partnership Agreement.

The General Partner shall be liable for the debts, obligations and any other liabilities of thePartnership in the manner and to the extent required by the LP Act and as set forth in the LimitedPartnership Agreement to the extent that Partnership assets are insufficient to pay such liabilities.

The General Partner will indemnify and hold harmless each Limited Partner for any costs,damages, liabilities, expenses or losses suffered or incurred by such Limited Partner that result from orarise out of such Limited Partner not having unlimited liability as set out in the Limited PartnershipAgreement, other than any liability caused by or arising out of any act or omission of such LimitedPartner. See Article 8 - Liabilities of Partners in the Limited Partnership Agreement.

Reports to Limited Partners

Within 90 days after the end of each fiscal year, the Investment Manager will forward to eachLimited Partner who has requested same an annual report for such fiscal year consisting of (i) auditedfinancial statements for such fiscal year; (ii) a report of the Auditors on such financial statements; (iii) areport on allocations to the Limited Partners’ Contributed Capital accounts and taxable income or loss anddistributions of cash to the General Partner and the Limited Partners for such fiscal period; and (iv) taxinformation to enable each Limited Partner to properly complete and file his or her tax returns in Canadain relation to an investment in Units. Within 60 days after the end of the first six months of each fiscalyear, the Investment Manager will forward to each Limited Partner who has requested same unauditedfinancial statements for such period.

The Investment Manager will also send to each Limited Partner a monthly report on the Net AssetValue per Unit of each series.

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Fiscal Year

The fiscal year of the Partnership shall end on December 31 in each calendar year.

Amendment

The General Partner may, without prior notice or consent from any Limited Partner, amend thePartnership Agreement (i) in order to protect the interests of the Limited Partners, if necessary; (ii) to cureany ambiguity or clerical error or to correct or supplement any provision contained therein which may bedefective or inconsistent with any other provision if such amendment does not and shall not in anymanner adversely affect the interests of any Limited Partner; (iii) to reflect any changes to any applicablelegislation; or (iv) in any other manner, if such amendment does not and shall not adversely affect theinterests of any Limited Partner in any manner. The Limited Partners may by Special Resolution (whichmust include the consent of the General Partner), amend the Limited Partnership Agreement. SeeArticle 13 - Amendment of Agreement in the Limited Partnership Agreement.

Term

The Partnership has no fixed term. Dissolution may only occur (i) at any time on 30 days writtennotice by the Investment Manager to each Limited Partner, or (ii) on the date which is 60 days followingthe removal of the General Partner, unless the Limited Partners agree by Ordinary Resolution to appoint areplacement General Partner and continue the Partnership. See Article 12 - Termination of the Partnershipin the Limited Partnership Agreement.

PRIME BROKERAGE AGREEMENT

The Partnership has appointed TD Securities Inc. (the “Prime Broker”) as prime broker in respect of thePartnership’s portfolio transactions. The Prime Broker will provide prime brokerage services to thePartnership under the terms of an institutional prime brokerage account agreement (the “Prime BrokerAgreement”), entered into between the Partnership and the Prime Broker dated as of September 2007.These services may include the provision to the Partnership of trade execution, settlement, reporting,securities financing, stock borrowing, stock lending, foreign exchange and banking facilities, and areprovided solely at the discretion of the Prime Broker. The Partnership may also utilise other brokers anddealers for the purposes of executing transactions for the Partnership. The Prime Broker does not providea traditional custody service for investments of the Partnership held on the books of the Prime Broker, butrather assumes possession of the assets and all right, title and interest in the assets is transferred to thePrime Broker as part of its prime brokerage function in accordance with the terms of the Prime BrokerAgreement. Assets not required as margin on borrowings are required to be segregated (from the PrimeBroker’s own assets) under the rules of the Investment Industry Regulatory Organization of Canada,which regulates the Prime Broker, but the Partnership’s assets may be commingled with the assets ofother clients of the Prime Broker. Furthermore, the Partnership’s cash and free credit balances on accountwith the Prime Broker are not segregated and may be used by the Prime Broker in the ordinary conduct ofits business, and the Partnership is an unsecured creditor in respect of those assets. The Partnership mayrequest delivery of any assets not required by the Prime Broker for margin or borrowing purposes.

The Partnership has agreed to indemnify the Prime Broker for losses it may incur in acting in any capacityunder the Prime Broker Agreement other than losses incurred as a result of the bad faith, wilful default,fraud or gross negligence of the person claiming indemnity. Neither the Prime Broker nor any brokersappointed has or will have investment discretion in relation to the Partnership and no responsibilities shallbe taken by any of the brokers for any of the assets of the Partnership held by other brokers.

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The Prime Brokerage Agreement may be effectively terminated at any time by either party (subject to therestriction on the ability of the Partnership to receive delivery of assets held by the Prime Broker assecurity against any margin or other borrowings).

CANADIAN INCOME TAX CONSIDERATIONS AND CONSEQUENCES

Investors are urged to consult with their tax advisers respecting the purchase, holding anddisposition of Units of the Partnership. Investors should be aware of the tax considerations andconsequences associated with an investment in a limited partnership generally and in an actively managedinvestment pool in particular.

RISK FACTORS

Investment in Units involves certain risk factors, including risks associated with the Partnership’sinvestment strategies. The following risks should be carefully evaluated by prospective investors.

Risks Associated with an Investment in the Partnership

Marketability and Transferability of Units

There is no market for the Units and their resale, transfer and redemption are subject torestrictions imposed by the Limited Partnership Agreement, including consent by the InvestmentManager, and applicable securities legislation. See “Transfer or Resale”. Consequently, holders of Unitsmay not be able to liquidate their investment in a timely manner and the Units may not be readilyaccepted as collateral for a loan.

Investment Risk

An investment in the Partnership may be deemed to be speculative and is not intended as acomplete investment program. A subscription for Units should be considered only by persons financiallyable to maintain their investment and who can bear the risk of loss associated with an investment in thePartnership. Investors should review closely the investment objective and investment strategies to beutilized by the Partnership as outlined herein to familiarize themselves with the risks associated with aninvestment in the Partnership.

Reliance on Investment Manager and Track Record

The success of the Partnership will be primarily dependent upon the efforts of the InvestmentManager and its principals. Investors should be aware that the past performance of the Partnership shouldnot be considered as an indication of future results.

Tax Liability

Net Asset Value of the Partnership and Net Asset Value per Unit will be marked to market andtherefore calculated on the basis of both realized trading gains and losses and accrued, unrealized gainsand losses. In computing each Limited Partner’s share of income or loss for tax purposes, only realizedgains and other factors, including the date of purchase or redemption of Units by a Limited Partner in afiscal year, will be taken into account. Therefore, the change in Net Asset Value of a Limited Partner’sUnits may differ from his share of income and loss for tax purposes. Furthermore, investors may beallocated income for tax purposes and not receive any cash distributions from the Partnership.

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Possible Loss of Limited Liability

Under the LP Act, the General Partner has unlimited liability for the debts, liabilities, obligationsand losses of the Partnership to the extent that they exceed the assets of the Partnership. The liability ofeach Limited Partner for the debts, liabilities, obligations and losses of the Partnership is limited to thevalue of money or other property the Limited Partner has contributed or agreed to contribute to thePartnership. In accordance with the LP Act, if a Limited Partner has received a return of all or part of theLimited Partner’s contribution to the Partnership, the Limited Partner is nevertheless liable to thePartnership, or where the Partnership is dissolved, to its creditors, for any amounts not in excess of theamount returned with interest, necessary to discharge the liabilities of the Partnership to all creditors whoextended credit or whose claims arose before the return of the contribution. The limitation of liability ofa Limited Partner may be lost if a Limited Partner takes part in the control of the business of thePartnership.

Funding Deficiencies

Other than with respect to the possible loss of the limited liability as outlined above, no LimitedPartner shall be obligated to pay any additional assessment on the Units held or subscribed. However, if,as a result of a distribution by the Partnership, the Partnership’s capital is reduced and the Partnership isunable to pay its debts as they become due, the Limited Partners may have to return to the Partnership anysuch distributions received by them to restore the capital of the Partnership. If the Partnership does nothave sufficient funds to meet its requirements and must default because the deficiency is not funded,Limited Partners may lose their entire investment in the Partnership.

Income

An investment in the Partnership is not suitable for an investor seeking an income from suchinvestment, as the Partnership may not, or may be unable to, distribute income earned by it.

Not a Public Mutual Fund

The Partnership is not subject to the restrictions placed on public mutual funds to ensurediversification and liquidity of the Partnership’s portfolio.

Custody Risk

The Partnership does not control the custodianship of all of its securities. The banks or brokeragefirms selected to act as custodians may become insolvent, causing the Partnership to lose all or a portionof the funds or securities held by those custodians. Consequently, the Partnership and therefore, theLimited Partners, may suffer losses.

Broker or Dealer Insolvency

The Partnership's assets may be held in one or more accounts maintained for the Partnership byits prime brokers or at other brokers. Such brokers are subject to various laws and regulations in variousjurisdictions that are designed to protect their customers in the event of their insolvency. However, thepractical effect of these laws and their application to the Partnership's assets are subject to substantiallimitations and uncertainties. Because of the large number of entities and jurisdictions involved and therange of possible factual scenarios involving the insolvency of a prime broker or any sub-custodians,agents or affiliates, it is impossible to generalize about the effect of their insolvency on the Partnershipand its assets. Investors should assume that the insolvency of any of the prime brokers or such otherservice providers would result in the loss of all or a substantial portion of the Partnership's assets held byor through such prime broker and/or the delay in the payment of withdrawal proceeds.

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Trading Errors

In the course of carrying out trading and investing responsibilities on behalf of the Partnership,employees of the Investment Manager may make “trading errors” — i.e., errors in executing specifictrading instructions. Examples of trading errors include: (i) buying or selling an investment asset at aprice or quantity that is inconsistent with the specific trading instructions generated by a particularstrategy; or (ii) buying rather than selling a particular investment asset (and vice versa). Trading errorsare an intrinsic factor in any complex investment process, and will occur notwithstanding the exercise ofdue care and special procedures designed to prevent trading errors. Trading errors are, therefore,distinguishable from errors in judgment, due diligence or other factors leading to a specific tradinginstruction being generated, as well as from unauthorized trading or other improper conduct by employeesof the Investment Manager. Consequently, the Investment Manager will (unless the Investment Managerotherwise determines) treat all trading errors (including those which result in losses and those whichresult in gains) as for the account of the Partnership, unless they are the result of conduct by theInvestment Manager which is inconsistent with the Investment Manager's standard of care.

Changes in Investment Strategy

The Investment Manager may alter its strategy without prior approval by the Limited Partners ifthe General Partner and the Investment Manager determine that such change is in the best interest of thePartnership.

Valuation of the Partnership’s Investments

While the Partnership is independently audited by its auditors on an annual basis in order toensure as fair and accurate a pricing as possible, valuation of the Partnership’s securities and otherinvestments may involve uncertainties and judgmental determinations and, if such valuations shouldprove to be incorrect, the Net Asset Value of the Partnership could be adversely affected. Independentpricing information may not at times be available regarding certain of the Partnership’s securities andother investments. Valuation determinations will be made in good faith in accordance with the LimitedPartnership Agreement.

Although the Partnership generally will invest in exchange-traded and liquid over-the-countersecurities, the Partnership may from time to time have some of its assets in investments which by theirvery nature may be extremely difficult to value accurately. To the extent that the value assigned by thePartnership to any such investment differs from the actual value, the Net Asset Value per Unit may beunderstated or overstated, as the case may be. In light of the foregoing, there is a risk that a LimitedPartner who redeems all or part of its Units while the Partnership holds such investments will be paid anamount less than such Limited Partner would otherwise be paid if the actual value of such investments ishigher than the value designated by the Partnership. Similarly, there is a risk that such Limited Partnermight, in effect, be overpaid if the actual value of such investments is lower than the value designated bythe Investment Manager in respect of a redemption. In addition, there is risk that an investment in thePartnership by a new Limited Partner (or an additional investment by an existing Limited Partner) coulddilute the value of such investments for the other Limited Partners if the actual value of such investmentsis higher than the value designated by the Investment Manager. Further, there is risk that a new LimitedPartner (or an existing Limited Partner that makes an additional investment) could pay more than it mightotherwise if the actual value of such investments is lower than the value designated by the InvestmentManager. The Partnership does not intend to adjust the Net Asset Value of the Partnership retroactively.

Potential Indemnification Obligations

Under certain circumstances, the Partnership might be subject to significant indemnificationobligations in favour of the General Partner, the Investment Manager, other service providers to the

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Partnership or certain persons related to them in accordance with the respective agreement between thePartnership and each such service provider. The Partnership will not carry any insurance to cover suchpotential obligations and, to the Investment Manager's knowledge, none of the foregoing parties will beinsured for losses for which the Partnership has agreed to indemnify them. Any indemnification paid bythe Partnership would reduce the Partnership's Net Asset Value.

Possible Effect of Redemptions

Substantial redemptions of Units could require the Partnership to liquidate positions more rapidlythan otherwise desirable to raise the necessary cash to fund redemptions and achieve a market positionappropriately reflecting a smaller asset base. Such factors could adversely affect the value of the Unitsredeemed and of the Units remaining outstanding.

Possible Effect of General Partner Distributions

The General Partner will receive distributions based on net realized and unrealized income andgains in a year, which distributions might theoretically exceed taxable income and taxable capital gains insuch year. The Partnership will not be entitled to claim such difference as an expense nor will the GeneralPartner have an obligation to the Partnership to repay any such distribution, having an adverse effect onthe Net Asset Value of the Units.

Charges to the Partnership

The Partnership is obligated to pay administration fees, brokerage commissions and legal,accounting, filing and other expenses regardless of whether the Partnership realizes profits. In addition,the Partnership may make a distribution to the General Partner upon a mid-year redemption in a fiscalyear in which there is a net loss for such year.

Lack of Independent Experts Representing Limited Partners

Each of the Partnership, the General Partner and the Investment Manager have consulted with asingle legal counsel regarding the formation and terms of the Partnership and the offering of Units. TheLimited Partners have not, however, been independently represented. Therefore, to the extent that thePartnership, the Limited Partners or this offering could benefit by further independent review, suchbenefit will not be available. Each prospective investor should consult his or her own legal, tax andfinancial advisers regarding the desirability of purchasing Units and the suitability of investing in thePartnership.

No Involvement of Unaffiliated Selling Agent

The General Partner and Investment Manager are under common control and ownership.Consequently, no outside selling agent unaffiliated with such parties has made any review or investigationof the terms of this offering, the structure of the Partnership or the background of the General Partner andInvestment Manager.

Possible Negative Impact of Regulation of Hedge Funds

The regulatory environment for hedge funds is evolving and changes to it may adversely affectthe Partnership. To the extent that regulators adopt practices of regulatory oversight in the area of hedgefunds that create additional compliance, transaction, disclosure or other costs for hedge funds, returns ofthe Partnership may be negatively affected. In addition, the regulatory or tax environment for derivativeand related instruments is evolving and may be subject to modification by government or judicial actionthat may adversely affect the value of the investments held by the Partnership. The effect of any futureregulatory or tax change on the portfolio of the Partnership is impossible to predict.

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Certain US Taxation Risk

Pursuant to new US tax rules, Limited Partners may be required to provide identity and residencyinformation to the Partnership, which may be provided by the Partnership to US tax authorities in order toavoid a US withholding tax being imposed on US and certain non-US source income and on proceeds ofdisposition received by the Partnership or on certain amounts (including distributions) paid by thePartnership to certain Limited Partners

Risks Associated with the Partnership’s Underlying Investments

General Economic and Market Conditions

The success of the Partnership’s activities may be affected by general economic and marketconditions, such as interest rates, availability of credit, inflation rates, economic uncertainty, changes inlaws, and national and international political circumstances. These factors may affect the level andvolatility of securities prices and the liquidity of the Partnership’s investments. Unexpected volatility orilliquidity could impair the Partnership’s profitability or result in losses.

Fixed Income Securities

The Partnership may invest in bonds or other fixed income securities of U.S., Canadian and otherissuers, including, without limitation, bonds, notes and debentures issued by corporations; debt securitiesissued or guaranteed by the federal, state or provincial government in the United States or Canada or agovernmental agency; and commercial paper. Fixed income securities pay fixed, variable or floating ratesof interest. The value of fixed income securities in which the Partnership invests will change in responseto fluctuations in interest rates. In addition, the value of certain fixed-income securities can fluctuate inresponse to perceptions of credit worthiness, political stability or soundness of economic policies. Fixedincome securities are subject to the risk of the issuer's inability to meet principal and interest payments onits obligations (i.e., credit risk) and are subject to price volatility due to such factors as interest ratesensitivity, market perception of the creditworthiness of the issuer and general market liquidity (i.e.,market risk). If fixed income investments are not held to maturity, the Partnership may suffer a loss at thetime of sale of such securities.

Equity Securities

To the extent that the Partnership holds equity portfolio investments, it will be influenced bystock market conditions in those jurisdictions where the securities held by the Partnership are listed fortrading and by changes in the circumstances of the issuers whose securities are held by the Partnership.Additionally, to the extent that the Partnership holds any foreign investments, it will be influenced byworld political and economic factors and by the value of the Canadian dollar as measured against foreigncurrencies which will be used in valuing the foreign investment positions held by the Partnership.

Options

Selling call and put options is a highly specialized activity and entails greater than ordinaryinvestment risk. The risk of loss when purchasing an option is limited to the amount of the purchase priceof the option, however investment in an option may be subject to greater fluctuation than an investment inthe underlying security. In the case of the sale of an uncovered option there can be potential for anunlimited loss. To some extent this risk may be hedged by the purchase or sale of the underlying security.

Small to Medium Capitalization Companies

The Partnership may invest a portion of its assets in the stocks of companies with small- tomedium-sized market capitalizations. While the Investment Manager believes these investments often

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provide significant potential for appreciation, those stocks, particularly smaller-capitalization stocks,involve higher risks in some respects than do investments in stocks of larger companies. For example,prices of such stocks are often more volatile than prices of large-capitalization stocks. In addition, due tothin trading in some such stocks, an investment in these stocks may be more illiquid than that of largercapitalization stocks.

Liquidity of Underlying Investments

Some of the securities in which the Partnership intends to invest may be thinly traded. There areno restrictions on the investment of Partnership assets in illiquid securities. It is possible that thePartnership may not be able to sell or repurchase significant portions of such positions without facingsubstantially adverse prices. If the Partnership is required to transact in such securities before its intendedinvestment horizon, the performance of the Partnership could suffer.

Shorting

Selling a security short (“shorting”) involves borrowing a security from an existing holder andselling the security in the market with a promise to return it at a later date. Should the security increase invalue during the shorting period, losses will incur to the Partnership. There is in theory no upper limit tohow high the price of a security may go. Another risk involved in shorting is the loss of a borrow, asituation where the lender of the security requests its return. In cases like this, the Partnership must eitherfind securities to replace those borrowed or step into the market and repurchase the securities. Dependingon the liquidity of the security shorted, if there are insufficient securities available at current marketprices, the Partnership may have to bid up the price of the security in order to cover the short, resulting inlosses to the Partnership.

Trading Costs

The Partnership may engage in a high rate of trading activity resulting in correspondingly highcosts being borne by the Partnership.

Currency and Exchange Rate Risks

The Partnership's cash assets may be held in currencies other than the Canadian dollar, and gainsand losses from futures contracts and currency forwards will generally be in currencies other than theCanadian dollar. Accordingly, a portion of the income received by the Partnership will be denominated innon-Canadian currencies. The Partnership nevertheless will compute and distribute its income inCanadian dollars. Thus changes in currency exchange rates may affect the value of the Partnership'sportfolio and the unrealized appreciation or depreciation of investments. Further, the Partnership mayincur costs in connection with conversions between various currencies.

Counterparty Risk

To the extent that any counterparty with or through which the Partnership engages in trading andmaintains accounts does not segregate the Partnership’s assets, the Partnership will be subject to a risk ofloss in the event of the insolvency of such person. Even where the Partnership’s assets are segregated,there is no guarantee that in the event of such an insolvency, the Partnership will be able to recover all ofits assets.

Leverage

The Partnership may use financial leverage by borrowing funds against the assets of thePartnership. Leverage increases both the possibilities for profit and the risk of loss for the Partnership.From time to time, the credit markets are subject to periods in which there is a severe contraction of both

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liquidity and available leverage. The combination of these two factors can result in leveraged strategiesbeing required to sell positions typically at highly disadvantageous prices in order to meet marginrequirements, contributing to a general decline in a wide range of different securities. Illiquidity can beparticularly damaging to leveraged strategies because of the essentially discretionary ability of dealers toraise margin requirements, requiring leveraged strategy to attempt to sell positions to comply with suchrequirements at a time when there are effectively no buyers in the market at all or at any but highlydistressed prices. These market conditions have in the past resulted in major losses to a substantialnumber of private investment funds. Such conditions, although unpredictable, can be expected to recur.

The foregoing statement of risks does not purport to be a complete explanation of all therisks involved in purchasing the Units. Potential investors should read this entire OfferingMemorandum and consult with their legal, tax and financial advisers, before making a decision toinvest in the Units.

CONFLICTS OF INTEREST

Securities regulation in Ontario requires that potential conflicts of interest be fully disclosed inthis offering memorandum. Such potential conflicts are perceived to arise whenever a registrant such asthe Investment Manager participates in the distribution of securities of a related or connected issuer.

In this case, because the Investment Manager is an affiliate of the General Partner and becausethe Investment Manager earns fees from the ongoing management of the Partnership’s investmentportfolio, the Partnership is considered both a related issuer and a connected issuer of the InvestmentManager. Details of this relationship and the fees earned by the Investment Manager are fully disclosedelsewhere in this offering memorandum.

CONFLICTS OF INTEREST POLICY

Statement of Policies Concerning Conflicts of Interest with Related Issuers and Connected Issuers

Applicable securities legislation requires securities dealers and advisers, when they trade inor advise with respect to their own securities or securities of certain other issuers to which they, orcertain other parties related to them, are related or connected, to do so only in accordance withparticular disclosure and other rules. These rules require dealers and advisers to inform theirclients of the relevant relationship and connections with the issuer of the securities prior to tradingwith or advising them. Clients should refer to the applicable provisions of such legislation for theparticulars of these rules and their rights or consult with a legal adviser.

The Investment Manager acts as an investment fund manager, a portfolio manager and an exemptmarket dealer and is registered as such in each province where required. As an exempt market dealer, theInvestment Manager intends only to sell interests in related limited partnerships and other pooled fundsorganized by the Investment Manager. Accordingly, there is no potential for a conflict of interest to ariseas there would be if, for example, the Investment Manager also sold or sought investors for securities ofunrelated issuers.

The Investment Manager may from time to time be deemed to be related or connected to one ormore issuers for purposes of the disclosure and other rules of the securities laws referred to above. TheInvestment Manager is prepared to act as a dealer in the ordinary course of its business to, and in respectof, securities of any such related or connected issuer. In any such case, these services shall be carried outby the Investment Manager in the ordinary course of its business as a dealer in accordance with its usualpractices and procedures and in accordance with all applicable disclosure and other regulatoryrequirements.

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Fairness Policy

As an investment counsel and portfolio manager, the Investment Manager and its employees shallconduct themselves with integrity and honesty and act in an ethical manner in all of their dealings with itsclients, including the Partnership.

The Investment Manager shall not knowingly participate or assist in the violation of any statute orregulation governing securities and investment matters.

The responsible persons shall exercise reasonable supervision over subordinate employees subjectto their control to prevent any violation by such persons of applicable statutes or regulations.

The Investment Manager shall exercise diligence and thoroughness on taking an investmentaction on a client’s behalf and shall have a reasonable and adequate basis for such actions, supported byappropriate research and investigations.

Before initiating an investment transaction for the Partnership, the Investment Manager willconsider its appropriateness and suitability.

The Investment Manager shall ensure that the Partnership’s account is supervised separately anddistinctly from all other clients’ accounts.

It may be determined that the purchase or sale of a particular security is appropriate for more thanone client account, i.e. that particular client orders should be aggregated or “bunched”, such that inplacing orders for the purchase or sale of securities, the Investment Manager may pool the Partnership’sorder with that of another client or clients. Simultaneously placing a number of separate, competingorders may adversely affect the price of a security. Therefore, where appropriate, when bunching orders,and allocating block purchases and block sales, it is the Investment Manager’s policy to treat all clientsfairly and to achieve an equitable distribution of bunched orders. All new issues of securities and blocktrades of securities will be purchased for, or allocated amongst, all applicable accounts of the InvestmentManager’s clients in a manner it considers to be fair and equitable.

In the course of managing a number of discretionary accounts, there may arise occasions whenthe quantity of a security available at the same price is insufficient to satisfy the requirements of everyclient, or the quantity of a security to be sold is too large to be completed at the same price. Similarly,new issues of a security may be insufficient to satisfy the total requirements of all clients. Under suchconditions, as a general policy, and to the extent that no client will receive preferential treatment, theInvestment Manager will ensure:

where orders are entered simultaneously for execution at the same price, or where a block trade isentered and partially filled, fills are allocated proportionately and equally on the amount of equityof each client’s account;

where a block trade is filled at varying prices for a group of clients, fills are allocated on anaverage price basis;

in the case of hot issues and IPOs, participation is split equally between clients basedproportionately on the equity in each account;

in the case of a new securities issue, where the allotment received is insufficient to meet the fullrequirements of all accounts on whose behalf orders have been placed, allocation is made on apro rata basis. However, if such prorating should result in an inappropriately small position for aclient, the allotment would be reallocated to another account. Depending on the number of new

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issues, over a period of time, every effort will be made to ensure that these prorating andreallocation policies result in fair and equal treatment of all clients, and

trading commissions for block trades are allocated on a pro rata basis, in accordance with theforegoing trade allocation policies.

Whichever method is chosen, it must be followed in the future where similar conditions exist.Where it is impossible to achieve uniform treatment, every effort shall be made by the InvestmentManager and its employees to compensate at the next opportunity in order that every client, large orsmall, over time, receives equitable treatment in the filling of orders.

In allocating bunched orders, the Investment Manager uses several criteria to determine the orderin which participating client accounts will receive an allocation thereof. Criteria for allocating bunchedorders include the current concentration of holdings of the industry in question in the account, and, withrespect to fixed income accounts, the mix of corporate and/or government securities in an account and theduration of such securities.

Some of the Investment Manager’s clients have selected a dealer to act as custodian for theclients’ assets and direct the Investment Manager to execute transactions through that dealer. It is not theInvestment Manager’s practice to negotiate commission rates with such dealers. For clients who grant theInvestment Manager brokerage discretion, the Investment Manager will block orders and all clienttransactions will be done at the same standard institutional per share commission rate

The Investment Manager may purchase or sell securities from or to other managed accountsprovided that the transaction is effected through an independent broker at the current market price of thesecurity or at the mid-point of the current market bid/ask price, unless a deviation is permitted in writingby the Chief Investment Officer.

Transactions for clients shall have priority over personal transactions so that personal transactionsdo not act adversely to the Partnership’s interest.

The Investment Manager will at all times preserve confidentiality of information communicatedby a client concerning matters within the scope of a confidential relationship.

Soft Dollar Arrangements

Soft dollar arrangements occur when brokers have agreed to provide other services (relating toresearch and trade execution) at no cost to the Investment Manager in exchange for brokerage businessfrom the Investment Manager’s managed accounts and investment funds. Although the brokers involvedin soft dollar arrangements do not necessarily charge the lowest brokerage commissions, the InvestmentManager will nonetheless enter into such arrangements when it is of the view that such brokers providebest execution and/or the value of the research and other services exceeds any incremental commissioncosts.

The Investment Manager may enter into soft dollar arrangements in accordance with industrystandards when it is of the view that such arrangements are for the benefit of its clients, however not allsoft dollar arrangements will benefit all clients at all times.

Statement of Related Registrants

Ontario securities legislation also requires securities dealers and advisers to inform their clients ifthe dealer or adviser has a principal shareholder, director or officer that is a principal shareholder, director

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or officer of another dealer or adviser and of the policies and procedures adopted by the dealer or adviserto minimize the potential for conflicts of interest that may result from this relationship.

At this time, the Investment Manager has no related registrants.

PROCEEDS OF CRIME (MONEY LAUNDERING) LEGISLATION

In order to comply with Canadian legislation aimed at the prevention of money laundering, theInvestment Manager may require additional information concerning investors. The SubscriptionAgreement contains detailed guidance on whether identification verification materials will need to beprovided with the Subscription Agreement and, if so, a list of the documents and information required.

If, as a result of any information or other matter which comes to the Investment Manager’sattention, any director, officer or employee of the Investment Manager, or its professional advisers, knowsor suspects that an investor is engaged in money laundering, such person is required to report suchinformation or other matter to the Financial Transactions and Reports Analysis Centre of Canada andsuch report shall not be treated as a breach of any restriction upon the disclosure of information imposedby law or otherwise.

FINANCIAL REPORTING

The Partnership is not a reporting issuer for the purpose of applicable securities legislation. See“Reports to Limited Partners.”

STATUTORY RIGHTS OF ACTION AND RESCISSION

In addition to and without derogation from any right or remedy that a purchaser of Units mayhave at law, securities legislation in certain of the provinces of Canada provides that a purchaser has ormust be granted rights of rescission or damages, or both, where the Offering Memorandum and anyamendment thereto contains a Misrepresentation. However, such rights must be exercised by thepurchaser within prescribed time limits.

As used herein, “Misrepresentation” means an untrue statement of a material fact or an omissionto state a material fact that is required to be stated or that is necessary to make any statement in thisOffering Memorandum or any amendment hereto not misleading in light of the circumstances in which itwas made. A “material fact” means a fact that significantly affects, or would reasonably be expected tohave a significant effect on, the market price or value of the Units.

Purchasers should refer to the applicable provisions of the securities legislation of their provinceof residence for the particulars of their rights or consult with a legal adviser. The following is a summaryof the rights of rescission or damages, or both, available to purchasers under the securities legislation ofthe Offering Jurisdictions.

Rights for Purchasers in Ontario

If this Offering Memorandum, together with any amendment or supplement hereto, delivered to apurchaser of Units resident in Ontario contains a Misrepresentation and it was a Misrepresentation at thetime of purchase of Units by such purchaser, the purchaser will have, without regard to whether thepurchaser relied on such Misrepresentation, a right of action against the Partnership for damages or, whilestill the owner of the Units purchased by that purchaser, for rescission (in which case, if the purchaserelects to exercise the right of rescission, the purchaser will have no right of action for damages against thePartnership) provided that:

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(a) the Partnership shall not be held liable pursuant to either right of action if the Partnershipproves the purchaser purchased the Units with knowledge of the Misrepresentation;

(b) in an action for damages, the Partnership is not liable for all or any portion of suchdamages that it proves do not represent the depreciation in value of the Units acquired bythe purchaser as a result of the Misrepresentation relied upon;

(c) the Partnership will not be liable for a Misrepresentation in forward-looking informationif the Partnership proves that:

(i) this Offering Memorandum contains, proximate to the forward-lookinginformation, reasonable cautionary language identifying the forward-lookinginformation as such, and identifying material factors that could cause actualresults to differ materially from a conclusion, forecast or projection in theforward-looking information, and a statement of material factors or assumptionsthat were applied in drawing a conclusion or making a forecast or projection setout in the forward-looking information; and

(ii) the Partnership has a reasonable basis for drawing the conclusion or making theforecasts and projections set out in the forward-looking information;

(d) in no case shall the amount recoverable pursuant to such right of action exceed thepurchase price of the Units acquired; and

(e) no action may be commenced to enforce such right of action more than,

(i) in the case of an action for rescission 180 days after the date of the acceptance ofthe purchaser’s Subscription by the Investment Manager; or

(ii) in the case of an action for damages, the earlier of

(A) 180 days after the purchaser first had knowledge of the facts giving riseto the cause of action, or

(B) three years after the date of the acceptance of the purchaser’sSubscription by the Investment Manager.

The foregoing rights do not apply if the purchaser purchased Units under the “accreditedinvestor” exemption and is:

(a) a Canadian financial institution (as defined in Ontario Securities Commission Rule 45-501) or a Schedule III bank;

(b) the Business Development Bank of Canada incorporated under the BusinessDevelopment Bank of Canada Act (Canada); or

(c) a subsidiary of any person referred to in paragraphs (a) and (b), if the person owns all ofthe voting securities of the subsidiary, except the voting securities required by law to beowned by directors of that subsidiary.

Rights for Purchasers in Québec

Under legislation adopted but not yet in force in Québec, if this Offering Memorandum, togetherwith any amendment to this Offering Memorandum, delivered to a purchaser of Units resident in Québec

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contains a Misrepresentation, the purchaser will have (i) a right of action for damages against thePartnership, every person acting in a capacity with respect to the Partnership which is similar to that of adirector of officer of a company and the dealer (if any) under contract to the Partnership, or (ii) a right ofaction against the Partnership for rescission of the purchase contract or revision of the price at whichUnits were sold to the purchaser.

No person or company will be liable if it proves that:

(a) the purchaser purchased the Units with knowledge of the Misrepresentation; or

(b) in an action for damages, that it acted prudently and diligently (except in an actionbrought against the Partnership).

No person will be liable for a Misrepresentation in forward-looking information if the personproves that:

(a) this Offering Memorandum contains, proximate to the forward-looking information, (1)reasonable cautionary language identifying the forward-looking information as such, andidentifying material factors that could cause actual results to differ materially from aconclusion, forecast or projection in the forward-looking information, and (2) a statementof the material factors or assumptions that were applied in drawing a conclusion ormaking a forecast or projection; and

(b) the person has a reasonable basis for drawing the conclusion or making the forecasts andprojections set out in the forward-looking information.

No action may be commenced to enforce such a right of action:

(a) for rescission or revision of price more than three years after the date of the purchase; or

(b) for damages later than the earlier of:

(i) three years after the purchaser first had knowledge of the facts giving rise to thecause of action, except on proof of tardy knowledge imputable to the negligenceof the purchaser; or

(ii) five years from the filing of this Offering Memorandum with the Autorité desmarchés financiers de Québec.

Rights for Purchasers in Manitoba

If this Offering Memorandum delivered to a purchaser of Units resident in Manitoba contains aMisrepresentation and it was a Misrepresentation at the time of purchase of Units by such purchaser, thepurchaser will be deemed to have relied on such Misrepresentation and will have a right of action againstthe Partnership and every person performing a function or occupying a position with respect to thePartnership which is similar to that of a director of a company, for damages or against the Partnership forrescission, in which case, if the purchaser elects to exercise the right of rescission, the purchaser will haveno right of action for damages against the Partnership, provided that among other limitations:

(a) the Partnership will not be liable if it proves that the purchaser purchased the Units withknowledge of the Misrepresentation;

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(b) in the case of an action for damages, the Partnership will not be liable for all or anyportion of the damages that it proves does not represent the depreciation in value of theUnits as a result of the Misrepresentation;

(c) other than with respect to the Partnership, no person or company is liable if the person orcompany proves:

(i) that this Offering Memorandum was sent to the purchaser without the person’s orcompany’s knowledge or consent; and

(ii) that, after becoming aware that it was sent, the person or company promptly gavereasonable notice to the Partnership that it was sent without the person’s orcompany’s knowledge and consent;

(d) other than with respect to the Partnership, no person or company is liable if the person orcompany proves that, after becoming aware of the Misrepresentation, the person orcompany withdrew the person’s or company’s consent to this Offering Memorandum andgave reasonable notice to the Partnership of the withdrawal and the reason for it;

(e) other than with respect to the Partnership, no person or company is liable with respect toany part of this Offering Memorandum not purporting to be made on an expert’sauthority and not purporting to be a copy of, or an extract from, an expert’s report,opinion or statement, unless the person or company:

(i) did not conduct an investigation sufficient to provide reasonable grounds for abelief that there had been no Misrepresentation; or

(ii) believed there had been a Misrepresentation;

(f) in no case will the amount recoverable in any action exceed the price at which the Unitswere sold to the purchaser; and

(g) the right of action for rescission or damages will be exercisable only if the purchasercommences an action to enforce such right, not later than:

(i) in the case of an action for rescission, 180 days after the date of purchase of theUnits; or

(ii) in the case of an action for damages, the earlier of (A) 180 days following thedate the purchaser first had knowledge of the facts giving rise to the cause ofaction, and (B) two years after the date of purchase of the Units.

A person or company is not liable in an action for a Misrepresentation in forward-lookinginformation if the person or company proves that:

(a) this Offering Memorandum contains, proximate to that information:

(i) reasonable cautionary language identifying the forward-looking information assuch, and identifying material factors that could cause actual results to differmaterially from a conclusion, forecast or projection in the forward-lookinginformation; and

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(ii) a statement of the material factors or assumptions that were applied in drawing aconclusion or making a forecast or projection set out in the forward-lookinginformation; and

(b) the person or company had a reasonable basis for drawing the conclusions or making theforecasts and projections set out in the forward-looking information.

If a Misrepresentation is contained in a record incorporated by reference in, or is deemed to beincorporated into, this Offering Memorandum, the Misrepresentation is deemed to be contained in thisOffering Memorandum.

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Agilith North American Diversified Fund LP80 Richmond Street West, Suite 203

Toronto, OntarioM5H 2A4

Tel No.: [email protected]

TOR01: 4199433: v10

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