Specialized Arbitration Procedure for Disputes arising between the Members of IDA, of the Montreal Exchange and their Clients

The General Commercial Arbitration Rules (GCAR) of the Canadian Commercial Arbitration Centre ("Centre"), as supplemented by the specialized arbitration procedure, is applicable to the terms and disputes described in Sections 1 to 3.

In the event of any discrepancy between the provisions of the GCAR and those of the specialized procedure, the provisions of the latter shall prevail.

APPLICATION

1. Any claim relating to a securities transaction by and between a member of IDA and of the Montreal Exchange who has adhered to this program, and one of its clients in the Province of Québec, shall qualify for arbitration if all facts relevant to the claim occurred subsequent to January 1st, 1996.

2. The specialized procedure is applicable to qualifying disputes, as defied in Section 1, subject to the following terms and conditions:

(a) that the client consents thereto if the dispute relates to a claim for an amount, greater than $ 3,000 but equal to or less than $100,000* including a cross-claim but excluding interestand arbitration fees;

(b)that both parties agree thereto,

— if the dispute relates to a claim for an amount equal to or less than $3,000, including a cross-claim but excluding interest and arbitration fees;

— if the dispute does not involve any amount or, if the amount is indeterminate;

— if the facts giving rise to the dispute have occur-red in part, both prior to and subsequent to January 1st, 1996, and the disputed amount is equal to or less than $ 100,000* including a cross-claim but excluding interest and arbitration fees.

3. In all cases not referred to in Section 2, the General Commercial Arbitration Rules shall apply subject to both parties* consent, and subject to the selection of the arbitrator from the list of arbitrators specialized in securities.

DELAYS AND NOTICES

4. The delays referred to in the provisions of the GCAR are reduced to seven (7) days with respect to the application of the specialized procedure.

5. A notice under the specialized procedure shall be conveyed by the Centre by telephone to a party, its agent or its authorized representative. The notice is decerned to have been received on the day the telephone communication was made. The notice by telephone is subsequently confirmed in writing, or by any rapid means, which allows for proof of receipt.

ARBITRATION NOTICE

6. The party who intends to submit a dispute for arbitration shall so advise the Centre in writing. Thee notice must namely include:

(a) the parties' names, occupations and addresses or those of their agents or authorized representatives, as the case may be;

(b) a summary statement of the matter of the dispute and, if applicable, the amount of the claim resulting from it;

Shall also be attached to the notice, the Arbitration Agreement, the documents and information which clearly establish the facts as well as the parties’ consent, if required. The arbitration is submitted to the Centre as at the date of receipt of the notice.

7. The Centre shall verify the qualification of the application in accordance with the requirements of the specialized procedure. In addition, it shall ensure that the parties have attempted to directly negotiate a settlement of the dispute.

8. If the application qualifies, then the Centre shall so advise the parties and shall send them a request for advanced fees, as well as a list of the arbitrators specialized in securities. The defendant has seven (7) days to file a reply to the arbitration notice and its cross-claim, if necessary.

APPOINTMENT OF THE ARBITRATOR

9. The dispute is submitted to one single arbitrator, unless other-wise agreed by the parties.

The parties shall choose, by mutual agreement, an arbitrator whose name appears on the list of arbitrators specialized in securities. They have seven (7) days from the receipt of the list to confirm their choice with the Centre. Should they fail to do so, the Centre shall, within the same delay, designate and confirm an arbitrator from the list.

ARBITRATION PROCEEDINGS

10. The arbitrator shall set the time and location of the arbitration proceedings, after consulting with the parties. He shall select the most practical solution involving the least expense as possible, and shall so notify the Centre.

11. The Centre shall give at least seven (7) days prior notice of the hearing date. Exceptionally, a party may, only once, request the arbitrator to postpone the hearing to a later date, by paying the applicable fees.

12. Subject to contradictory procedure or the arbitrators' consent, the parties may, by mutual agreement, forego oral arguments and present their claims and arguments in writing only. If the parties cannot agree on the conduct of the written procedure, the procedure shall be oral.

The parties and the arbitrator may agree that the arbitration shall proceed entirely by telephone conference.

13. At the outset of the arbitration proceedings, the arbitrator shall explain the arbitration procedure to the parties. He shall apply the rules of law, except if the parties mutually agree that his role should be that of the amiable compositeur. He shall verify the parties’ agreement with respect to:

(a) the applicable rules of evidence;

(b) the number of lay and expert witnesses which shall be heard and the equitable distribution of hearing time.

In addition, the arbitrator may, at his sole initiative or at a party’s request, render a decision with respect to any issue which would not have been raised, nor have been the object of an agreement between the parties. It is equally possible for the parties to complete their statement of claims, and if the arbitration tribunal agrees thereto, make any modification or revision to the notice of arbitration, the reply, the crossclaim and the reply of the cross-claim.

Once these verifications have been made, the arbitrator, depending on the duration of time scheduled for the hearing and/or in the event of a modification to the amount in dispute, shall determine whether the specialized procedure remains applicable to the file. In the event of its inapplicability, he shall then refer the file to the general procedure of the GCAR for the future, while remaining the competent arbitrator. The first hearing session shall then replace the preparatory conference and the arbitrator shall send minutes thereof to the Centre.

14. The hearing of the dispute shall usually proceed within a period of four (4) hours in the same day of hearing. In the event that a longer hearing period becomes necessary, supplementary costs, according to the appended rate schedule shall be requested from the parties.

THE ARBITRATION AWARD

15. The arbitrator shall render an award in writing, stating the grounds on which it is based, and signs it. The award must be rendered in a maximum delay of sixty (60) days from the receipt of the file by the arbitrator, and at the latest, three (3) days after the hearings have terminated, or in the event that oral arguments have been foregone, three (3) days after the date on which the arbitrator received the documents.

Except for any agreement between the parties and the arbitrator, or owing to the Centre’s decision, this delay may be modified.

16. The Centre shall provide the parties with the award.

ARBITRATION COSTS

17. The plaintiff shall include with his arbitration application, expenses related to the opening of a file, non refundable but deductible from his share of the arbitration fees. During the specialized procedure, the Centre may require special fees, as defined and calculated in the appended rate schedule.

18. The arbitrator shall distribute the arbitration fees equally between the parties, except for the special fees which shall be settled by one party only. Exceptionally and if the circumstances so justify, the arbitrator may modify the distribution of the arbitration fees.

The specialized procedure comes into force January 1st, 1996.

*Increased from $50,000 to $100,000 as of November 3, 1999.