CNQ

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CNQ Canadas New Stock Exchange
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Benefits of Going Public

• Access to Capital
• Vital in the mineral exploration business
• Platform to grow
• Currency to make acquisitions
• Maintain Control
• As little as 5 can be in public hands
• Profile
• Provide a secondary market for existing
  shareholders
• Compensation
• Share issuances, stock options, etc.

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Means of Going Public

• Prospectus
• Non-offering clears existing shareholders
• IPO
• Cheaper
• Must go through Securities Commission(s)
• Reverse Takeover (RTO)
• Advantages
• Faster
• Built in distribution
• Disadvantages
• Expensive
• Homework must be done

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CNQ

• Recognized by OSC Feb. 28, 2003 as a quotation
  and trade reporting system
• Launch July 25, 2003
• Recognized as a stock exchange on May 7, 2004
• Designed to meet the needs of
• Issuers
• Dealers
• Investors

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CNQ Competitive Advantages

• A cost effective exchange
• Streamlined regulatory model
• Liquidity
• Multiple market making combined with client
  orders helps create orderly markets
• Transparency
• Integrity

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CNQ Overview

• Fully electronic trading platform
• Auction market competitive market makers
• Issuer standards enhanced disclosure
  requirements

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CNQ Market Structure
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Overview of Listing Process

• Application and agreement to comply
• Listing Statement (Form 2A)
• Prospectus level disclosure
• Background checks on management and insiders to
  ensure they are acceptable
• Documentation posted on CNQ.CA
• Central repository for all CNQ enhanced
  disclosure and SEDAR filings
• Approvals in as little as 3 weeks

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Overview of Listing Requirements

• Public Float
• 150 shareholders with a minimum one board lot
  each representing 10 of the issued and
  outstanding shares
• Financial Resources
• Revenues from business activity or a plan with
  the resources to achieve objectives (minimum
  100,000 in working capital)
• Resource companies must have a technical report
  compliant with the appropriate National
  Instrument
• May retain your CCPC status while listed on CNQ

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Streamlined Regulation

• Disclosure driven (CNQ.CA)
• Listing Statement
• Monthly Update
• Quarterly Report
• SEDAR
• No transaction reviews/approvals
• Systematic reviews of the disclosure record

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Transaction Process

• Post notice on CNQ.CA and observe Timely
  Disclosure Requirements
• Post CNQ Form applicable to type of transaction
• Post CEO certificate of compliance
• Wait 24 hours
• Close Transaction
• Therefore, no cost or delay!

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CNQ Issuer Fee Structure

• Application fee 10,000
• -Non refundable deposit of 2,000 GST with
  initial application with the balance due six
  months after listing
• Maintenance fee 300/month
• No annual sustaining fee
• No transaction fees

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Visibility on CNQ.CA

• Disclosure Hall
• Market info including depth with a 15 minute
  delay
• Company info
• Links to all disclosure
• Centralized
• Secure Issuer controlled
• Internet access for all investors

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CNQ Contacts416-572-2000 www.CNQ.CA

• Issuers
• Radhika Joseph, Listings Coordinator
• Mark Faulkner, Director of Listings Regulation
• Rob Theriault, Business Development, Listings
• Dealers
• Natasha Blackburn, Market Development
• Bernard Chua, Market Operations
• Rules, General Policies
• Tim Baikie, General Counsel
• Western Canada
• Mark Francis, 204-942-8992