MOTION RECORD (returnable April 8, 2015)

Transcription

1 ONTARIO SUPERIOR COURT OF JUSTICE COMMERCIAL LIST Court File No. CV CL BETWEEN: ROYAL BANK OF CANADA Applicant - and ONTARIO INC., ONTARIO INC. and ONTARIO INC. Respondents MOTION RECORD (returnable April 8, 2015) March 27,2015 AIRD & BERLIS LLP Barristers and Solicitors Brookfield Place 181 Bay Street, Suite 1800 Toronto, ON M5J 2T9 Steven L. Graff (LSUC # 31871V) Tel: (416) Fax: (416) sgraff@,airdberlis.com Ian Aversa (LSUC # 55449N) Tel: (416) Fax: (416) iaversa@,airdberlis.com Lawyers for EDO Canada Limited, in its capacity as the Court-appointed receiver of Ontario Inc., Ontario Inc. and Ontario Inc.

2 SERVICE LIST (Current as of March 17, 2015) TO: AIRD & BERLIS LLP Brookfield Place 181 Bay Street, Suite 1800 Toronto, ON M5J 2T9 Steven L. Graff Tel: Fax: Ian Aversa Tel: Fax: Lawyers for EDO Canada Limited AND TO: BDO CANADA LIMITED 1 City Centre Drive, Suite 1040 Mississauga, ON L5B 1M2 Vince Siciliano / Peter Naumis Tel: / x 4233 Fax: / vsiciliano@bdo.ca / pnaumis@,bdo,ca Court-Appointed Receiver AND TO: ELETT BECCARIO Barristers & Solicitors 190 Division Street, P.O. Box 340 Welland, ON L3B 5P9 Clark Peddle Tel: Fax: cpeddle@flettbeccario.com Lawyers for Royal Bank of Canada

3 - 2 - AND TO: ONTARIO INC., ONTARIO INC. and ONTARIO INC. c/o George Morrison and Steve Walsh 678 Guelph Line, Unite 3 Burlington, ON L2R 3M8 surfergeorgemorrison@,gmail.com steve.surfparadise@svmpatico.ca AND TO: FELTMATE DELIBATO HEAGLE LLP Billings Court Burlington, ON L7N 3N6 Ron Weston Tel: Fax: rweston@fdhlawvers.com Lawyers for Ontario Inc., Ontario Inc. and Ontario Inc. AND TO: SIMPSON WIGLE LAW LLP 390 Brant Street, Suite 501 Burlington, ON L7R 4J4 Bart Sarsh Tel: ext. 235 Fax: sarshb@simpsonwigle.coni Lawyers for Business Development Bank of Canada AND TO: MSI SPERGEL INC. 21 King Street West, Suite 1602 Hamilton, ON L8P 4W7 Trevor Pringle Tel: Fax: tpringle@spergel.ca

4 -3 - AND TO: AND TO: K2 CORPORATION OF CANADA 1 Westside Drive, Unit 7 Toronto, ON M9C 1B2 HARRY ZHORUK 3077 New Street Burlington, ON L7N 1M6 Tel: Fax: sandi@liwzlaw.ca Lawyers for the Landlord, Dr. Brendan Chin AND TO: MARK SCHOPPER LAW, LLC P.O. Box Reno, Nevada Mark Schopper Tel: Fax: mark@schopperlaw.com Lawyers for Ocean Lineage AND TO: STEWART, ESTEN LLP 100 Collier Street PO Box 7700, Stn. Barrie Barrie, ON L4M 4V3 Ardel M. Johnston Tel: Ext: 237 Fax: aiohnston@,stewartesten.ca LaM'yers for Robert Nunn and Ontario Limited

5 -4- AND TO: DEPARTMENT OF JUSTICE The Exchange Tower 130 King Street West, Suite 3400 Toronto, ON M5X 1K6 Attention: Diane Winters Tel: Fax: AND TO: HER MAJESTY THE QUEEN IN RIGHT OF THE PROVINCE OF ONTARIO AS REPRESENTED BY THE MINISTER OF FINANCE (Income Tax, PST) PO Box King Street West, 6 th Floor Oshawa, ON L1H 8E9 Attention: Kevin J. O'Hara kevin.ohara@ontario.ca

6 /'

7 ONTARIO SUPERIOR COURT OF JUSTICE COMMERCIAL LIST Court File No. CV CL BETWEEN: ROYAL BANK OF CANADA Applicant - and ONTARIO INC., ONTARIO INC. and ONTARIO INC. Respondents TABLE OF CONTENTS TAB NO. Notice of Motion 1 Draft Approval and Vesting Order 2 Draft Approval and Vesting Order blacklined to the Model Approval and Vesting Order 3 Draft Ancillary Order 4 Draft Discharge Order 5 Draft Discharge Order blacklined to the Model Discharge Order 6 First Report of BDO Canada Limited, dated March 27, Appendices to the First Report Order of the Ontario Superior Court of Justice (Commercial List), dated December 2, 2014 A

8 -2- Confidential Information Memorandum Newspaper Notices, dated December 11, 2014 Security Opinion from Aird & Berlis LLP, dated March 16, 2015 Fee Affidavit of Vince Siciliano, sworn March 26, 2015 Fee Affidavit of Steven L. Graff, sworn March 26, 2015 Receiver's Interim Statement of Receipts and Disbursements B C D E F G Confidential Appendices to the First Report Appraisal of Surf Assets, dated December 24, 2014 Summary of Offers Received from Platinum Asset Services and Algonquin Outfitters A B Summary of Final Offers Received from Platinum Asset Services and Algonquin Outfitters C Appraisal of Huntsville Location, dated December 10, 2014 Realtor Proposals for the Huntsville Location Offer from Jo-Anna MacDonald, dated February 20, 2015 Receiver's Sign Back of Offer from Jo-Anna MacDonald, dated February 26, 2015 Final and Best Offer from Robert Nunn Final and Best Offer from Jo-Anna MacDonald Receiver's Sign Back of Offer from Jo-Anna MacDonald, dated March 2, 2015 Sale Agreement, dated February 27, 2015 and amended March 10, 2015 D E F G H I J K

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10 ONTARIO SUPERIOR COURT OF JUSTICE COMMERCIAL LIST Court File No. CV CL BETWEEN: ROYAL BANK OF CANADA Applicant - and ONTARIO INC., ONTARIO INC. and ONTARIO INC. Respondents NOTICE OF MOTION (returnable April 8, 2015) BDO Canada Limited ("BDO"), in its capacity as the Court-appointed receiver (in such capacity, the "Receiver"), without security, of all of the assets, undertakings and properties of Ontario Inc., Ontario Inc. and Ontario Inc. (collectively, the "Debtors"), will make a motion to a judge presiding over the Commercial List on Wednesday, April 8, 2015 at 10:00 a.m., or as soon after that time as the motion can be heard, at 330 University Avenue, Toronto, Ontario. PROPOSED METHOD OF HEARING: The motion is to be heard orally. THE MOTION IS FOR an Order, including, among other things: (a) if necessary, abridging the time for service and filing of this notice of motion and the motion record or, in the alternative, dispensing with same;

11 2 (b) approving the First Report of the Receiver dated March 27, 2015 (the "First Report") and approving the actions of the Receiver described therein; (c) sealing Confidential Appendices "A" through "K" to the First Report (collectively, the "Confidential Appendices") until further order of this Court; (d) approving the agreement of purchase and sale between the Receiver, as vendor, and Robert Nunn, as purchaser, dated February 27, 2015 (the "Sale Agreement"), which Sale Agreement was subsequently amended to provide that title in the property described in the Sale Agreement would be taken in the name of Ontario Limited (the "Purchaser"), and authorizing the Receiver to complete the transaction contemplated thereby (the "Transaction"); (e) vesting in the Purchaser, or as it may direct, the Debtors' right, title and interest in and to the property described in the Sale Agreement, free and clear of any claims and encumbrances; (f) authorizing and directing the Receiver to distribute to Royal Bank of Canada ("RBC"), without further Order of this Court, certain funds on account of the Debtors' secured indebtedness for principal, interest and costs owing to RBC; (g) authorizing and directing the Receiver to distribute to the Corporation of the Town of Huntsville, without further Order of this Court, certain funds on account of accrued municipal property tax arrears; (h) authorizing and directing the Receiver to dispose of certain of the Debtors' books and records to the extent that they, in the Receiver's view, are unnecessary to complete the Receiver's mandate; (i) effective upon the filing of a certificate by the Receiver certifying that all outstanding matters to be attended to in connection with the receivership of the Debtors have been completed to the satisfaction of the Receiver, discharging BDO as Receiver and releasing BDO from any and all liability that BDO has or

12 3 may hereafter have by reason of, or in any way arising out of, the acts or omissions of BDO while acting in its capacity as Receiver; 0 approving the Receiver's Interim Statement of Receipts and Disbursements as at March 26, 2015; (k) approving the fees and disbursements of the Receiver and its counsel, including an accrual for fees and disbursements to be incurred to the completion of these proceedings; and (1) such further and other relief as counsel may advise and this Court may permit. THE GROUNDS FOR THE MOTION ARE: (a) pursuant to an Order of this Court dated December 2, 2014 (the "Receivership Order"), BDO was appointed as receiver, without security, of all of the assets, undertakings and properties of the Debtors (the "Property"); (b) pursuant to the Receivership Order, the Receiver was authorized to market any or all of the Property, including advertising and soliciting offers in respect of the Property and negotiating such terms and conditions of sale as the Receiver, in its discretion, deems appropriate; (c) the marketing and sale process has culminated in, amongst other things, the Sale Agreement, which the Receiver has accepted, subject to approval by this Court; (d) the Sale Agreement, as amended, contemplates that the Receiver will complete the Transaction and that the property described in the Sale Agreement will be vested in the Purchaser; (e) a condition of the Sale Agreement, as amended, is that this Court provide a sale approval and vesting order in favour of the Purchaser;

13 4 (f) the purchase price contemplated by the Sale Agreement, as amended, represents the highest and best offer for the Debtors' Property that is the subject of the Sale Agreement; (g) a sealing order is required because the Confidential Appendices to the First Report contain certain commercially sensitive information, the release of which could prejudice the stakeholders of the Debtors, particularly if the Transaction does not close; (h) the Receiver has filed with the Court its First Report outlining, among others things: (i) the background to the Debtors' business, operations and financial position; (ii) the actions of the Receiver since its appointment pursuant to the Receivership Order; (iii) the Sale Process; (iv) the status of the secured claims against the estates of the Debtors; (v) the Receiver's proposed scheme of distribution; and (vi) the professional fees and disbursements of the Receiver and its counsel; (i) the Debtors are indebted to and have provided security in favour of RBC, and the Receiver has obtained an independent legal opinion from Aird & Berlis LLP confirming the validity and enforceability of the security granted by the Debtors in favour of RBC; (j) the Debtors are indebted to the Corporation of the Town of Huntsville in respect of municipal property tax arrears; (k) the Receiver is in possession of approximately three skids of bankers boxes containing the aged books and records of the Debtors, many of which books and records the Receiver views as unnecessary to complete the Receiver's mandate, the storage costs of which books and records are not insignificant; (1) the principals of the Debtors have advised the Receiver that they have no interest in the Debtors' books and records that the Receiver proposes to dispose;

14 5 (m) the Receiver and its counsel, Aird & Berlis LLP, have accrued fees and expenses in their capacity as Receiver and counsel thereto, respectively, which fees and expenses require the approval of this Court pursuant to the Receivership Order; (n) the Receivership Order authorizes the Receiver to pass its accounts from time to time, and to include any necessary solicitor fees and disbursements in the passing of the accounts; (o) the administration of the receivership of the Debtors will come to an end once the Transaction is completed and the proceeds realized by the Receiver to date are distributed; (p) the other grounds set out in the First Report; (q) the inherent and equitable jurisdiction of this Court; (r) section 243 of the Bankruptcy and Insolvency Act, R.S.C. 1985, c. B-3, as amended; (s) section 101 of the Courts of Justice Act, R.S.O. 1990, c. C.43, as amended; (t) rules 1.04, 2.03, 3.02, 30, 37 and of the Rides of Civil Procedure, R.R.O. 1990, Reg. 194, as amended; and (u) such further and other grounds as counsel may advise and this Court may permit. 2. THE FOLLOWING DOCUMENTARY EVIDENCE will be used at the hearing of the motion: (a) the First Report; (b) the affidavit of Vince Siciliano sworn March 26, 2015; (c) the affidavit of Steven L. Graff sworn March 26, 2015; and (d) such further and other material as counsel may submit and this Court may permit.

15 6 Date: March 27, 2015 AIRD & BERLIS LLP Barristers and Solicitors Brookfield Place 181 Bay Street, Suite 1800 Toronto, ON M5J 2T9 TO: ATTACHED SERVICE LIST Steven L. Graff (LSUC # 31871V) Tel: (416) Fax:(416) sgraff@airdberlis.com Ian Aversa (LSUC # 55449N) Tel: (416) Fax: (416) iaversa@airdberlis.com Lawyers for EDO Canada Limited, in its capacity as the Court-appointed receiver of Ontario Inc., Ontario Inc. and Ontario Lnc.

16 SERVICE LIST (Current as of March 17, 2015) TO: AIRD & BERLIS LLP Brookfield Place 181 Bay Street, Suite 1800 Toronto, ON M5J 2T9 Steven L. Graff Tel: Fax: Ian Aversa Tel: Fax: Lawyers for BDO Canada Limited AND TO: BDO CANADA LIMITED 1 City Centre Drive, Suite 1040 Mississauga, ON L5B 1M2 Vince Siciliano / Peter Naumis Tel: / x 4233 Fax: / vsiciliano@bdo.ca / pnaumis@bdo.ca Court-Appointed Receiver AND TO: ELETT BECCARIO Barristers & Solicitors 190 Division Street, P.O. Box 340 Welland, ON L3B 5P9 Clark Peddle Tel: Fax: cpeddle@flettbeccario.com Lawyers for Royal Bank of Canada

17 - 2 - AND TO: ONTARIO INC., ONTARIO INC. and ONTARIO INC. c/o George Morrison and Steve Walsh 678 Guelph Line, Unite 3 Burlington, ON L2R 3M8 surfergeorgemorrison@gmail.coni steve.surfparadise@sympatico.ca AND TO: FELTMATE DELIBATO HEAGLE LLP Billings Court Burlington, ON L7N 3N6 Ron Weston Tel: Fax: rweston@fdhlawvers.com Lawyers for Ontario Inc., Ontario Inc. and Ontario Inc. AND TO: SIMPSON WIGLE LAW LLP 390 Brant Street, Suite 501 Burlington, ON L7R 4J4 Bart Sarsh Tel: ext. 235 Fax: sarshb@,simpsonwigle.com Lawyers for Business Development Bank of Canada AND TO: MSI SPERGEL INC. 21 King Street West, Suite 1602 Hamilton, ON L8P 4W7 Trevor Pringle Tel: Fax: tpringle@,spergel.ca

18 -3 - AND TO: AND TO: K2 CORPORATION OF CANADA 1 Westside Drive, Unit 7 Toronto, ON M9C 1B2 HARRY ZHORUK 3077 New Street Burlington, ON L7N 1M6 Tel: Fax: sandi@hwzlaw.ca Lawyers for the Landlord, Dr. Brendan Chin AND TO: MARK SCHOPPER LAW, LLC P.O. Box Reno, Nevada Mark Schopper Tel: Fax: mark@schopperlaw.com Lawyers for Ocean Lineage AND TO: STEWART, ESTEN LLP 100 Collier Street PO Box 7700, Stn. Barrie Barrie, ON L4M 4V3 Ardel M. Johnston Tel: Ext: 237 Fax: aiohnston@stewartesten.ca Lawyers for Robert Nann and Ontario Limited

19 -4- AND TO: DEPARTMENT OF JUSTICE The Exchange Tower 130 King Street West, Suite 3400 Toronto, ON M5X 1K6 Attention: Diane Winters Tel: Fax: AND TO: HER MAJESTY THE QUEEN IN RIGHT OF THE PROVINCE OF ONTARIO AS REPRESENTED BY THE MINISTER OF FINANCE (Income Tax, PST) PO Box King Street West, 6 th Floor Oshawa, ON L1H 8E9 Attention: Kevin J. O'Hara kevin.ohara@ontario,ca

20 ROYAL BANK OF CANADA and ONTARIO INC., ONTARIO INC. and ONTARIO INC. Applicant Respondents Court File No. CV CL ONTARIO SUPERIOR COURT OF JUSTICE COMMERCIAL LIST Proceedings commenced at Toronto NOTICE OF MOTION AIRD & BERLIS LLP Barristers and Solicitors Brookfield Place 181 Bay Street, Suite 1800 Toronto, ON M5J 2T9 Steven L. Graff (LSUC # 31871V) Tel: (416) Fax: (416) sgraff@,airdberlis.com Ian Aversa (LSUC # 55449N) Tel: (416) Fax: (416) iaversa@airdberlis.com Lawyers for EDO Canada Limited, in its capacity as the Courtappointed receiver of Ontario Inc., Ontario Inc. and Ontario Inc.

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22 ONTARIO SUPERIOR COURT OF JUSTICE COMMERCIAL LIST Court File No. CV CL THE HONOURABLE JUSTICE ) WEDNESDAY, THE 8 th DAY ) ) OF APRIL, 2015 BETWEEN: ROYAL BANK OF CANADA Applicant - and ONTARIO INC., ONTARIO INC. and ONTARIO INC. Respondents APPROVAL AND VESTING ORDER THIS MOTION, made by BDO Canada Limited, in its capacity as the Court-appointed receiver (in such capacity, the "Receiver"), without security, of all of the assets, undertakings and properties of Ontario Inc., Ontario Inc. and Ontario Inc. (collectively, the "Debtors") for an order, inter alia, approving the sale transaction (the "Transaction") contemplated by an agreement of purchase and sale between the Receiver, as vendor, and Robert Nunn ("Nunn"), as purchaser, dated February 27, 2015 (the "Sale Agreement"), a copy of which Sale Agreement is attached as Confidential Appendix "K" to the

23 First Report of the Receiver dated March 27, 2015 (the "First Report") and which Sale Agreement was subsequently amended to provide that all of the Debtor's right, title and interest in and to the property described in the Sale Agreement (the "Purchased Assets") would be taken in the name of Ontario Limited (the "Purchaser"), and vesting in the Purchaser, or as it may direct, all of the Debtors' right, title and interest in and to the Purchased Assets, was heard this day at 330 University Avenue, Toronto, Ontario. ON READING the First Report and appendices thereto, and on hearing the submissions of counsel for the Receiver and such other counsel as were present, no one appearing for any other person named on the service list, although properly served as appears from the affidavit of Mona Markussen sworn March 27, 2015, filed, 1. THIS COURT ORDERS AND DECLARES that the Transaction is hereby approved, and the execution of the Sale Agreement, as amended, by the Receiver is hereby authorized and approved, with such minor amendments as the Receiver may deem necessary. The Receiver is hereby authorized and directed to take such additional steps and execute such additional documents as may be necessary or desirable for the completion of the Transaction and for the conveyance of the Purchased Assets to the Purchaser, or as it may direct. 2. THIS COURT ORDERS AND DECLARES that upon the delivery of a Receiver's certificate to the Purchaser substantially in the form attached as Schedule "A" hereto (the "Receiver's Certificate"), all of the Debtors' right, title and interest in and to the Purchased Assets described in the Sale Agreement, as amended, shall vest absolutely in the Purchaser, or as it may direct, free and clear of and from any and all security interests (whether contractual, statutory, or otherwise), hypothecs, mortgages, trusts or deemed trusts (whether contractual,

24 statutory, or otherwise), liens, executions, levies, charges, or other financial or monetary claims, whether or not they have attached or been perfected, registered or filed and whether secured, unsecured or otherwise (collectively, the "Claims"), including, without limiting the generality of the foregoing: (i) any encumbrances or charges created by the Order of the Honourable Mr. Justice Newbould dated December 2, 2014; (ii) all charges, security interests or claims evidenced by registrations pursuant to the Personal Property Security Act (Ontario) or any other personal property registry system; and (iii) those Claims listed on Schedule "C" hereto (all of which are collectively referred to as the "Encumbrances", which term shall not include the permitted encumbrances, easements and restrictive covenants listed on Schedule "D") and, for greater certainty, this Court orders that all of the Encumbrances affecting or relating to the Purchased Assets are hereby expunged and discharged as against the Purchased Assets. 3, THIS COURT ORDERS that upon the registration in the Land Registry Office for the appropriate Land Titles Division of an Application for Vesting Order in the form prescribed by the Land Titles Act and/or the Land Registration Reform Act, the Land Registrar is hereby directed to enter the Purchaser, or as it may direct, as the owner of the subject real property identified in Schedule "B" hereto (the "Real Property") in fee simple, and is hereby directed to delete and expunge from title to the Real Property all of the Claims listed in Schedule "C" hereto. 4. THIS COURT ORDERS that for the purposes of determining the nature and priority of Claims, the net proceeds from the sale of the Purchased Assets shall stand in the place and stead of the Purchased Assets, and that from and after the delivery of the Receiver's Certificate all Claims and Encumbrances shall attach to the net proceeds from the sale of the Purchased Assets with the same priority as they had with respect to the Purchased Assets immediately prior to the

25 - 4 - sale, as if the Purchased Assets had not been sold and remained in the possession or control of the person having that possession or control immediately prior to the sale. 5. THIS COURT ORDERS AND DIRECTS the Receiver to file with the Court a copy of the Receiver's Certificate, forthwith after delivery thereof. 6. THIS COURT ORDERS that, pursuant to clause 7(3)(c) of the Canada Personal Information Protection and Electronic Documents Act, the Receiver is authorized and permitted to disclose and transfer to the Purchaser all human resources and payroll information in the Debtors' records pertaining to the Debtors' past and current employees. The Purchaser shall maintain and protect the privacy of such information and shall be entitled to use the personal information provided to it in a manner which is in all material respects identical to the prior use of such information by the Debtor. 7. THIS COURT ORDERS that, notwithstanding: (a) the pendency of these proceedings; (b) any applications for a bankruptcy order now or hereafter issued pursuant to the Bankruptcy and Insolvency Act (Canada) in respect of the Debtors and any bankruptcy order issued pursuant to any such applications; and (c) any assignment in bankruptcy made in respect of the Debtors, the vesting of the Purchased Assets in the Purchaser, or as it may direct, pursuant to this Order shall be binding on any trustee in bankruptcy that may be appointed in respect of the Debtors and shall not be void or voidable by creditors of the Debtors, nor shall it constitute nor be deemed to

26 -5- be a fraudulent preference, assignment, fraudulent conveyance, transfer at undervalue or other reviewable transaction under the Bankruptcy and Insolvency Act (Canada) or any other applicable federal or provincial legislation, nor shall it constitute oppressive or unfairly prejudicial conduct pursuant to any applicable federal or provincial legislation. 8. THIS COURT ORDERS AND DECLARES that the Transaction is exempt from the application of the Bulk Sales Act (Ontario). 9. THIS COURT HEREBY REQUESTS the aid and recognition of any court, tribunal, regulatory or administrative body having jurisdiction in Canada or in the United States to give effect to this Order and to assist the Receiver and its agents in carrying out the terms of this Order. All courts, tribunals, regulatory and administrative bodies are hereby respectfully requested to make such orders and to provide such assistance to the Receiver, as an officer of this Court, as may be necessary or desirable to give effect to this Order or to assist the Receiver and its agents in carrying out the terms of this Order.

27 Schedule "A" - Form of Receiver's Certificate ONTARIO SUPERIOR COURT OF JUSTICE COMMERCIAL LIST Court File No. CV CL BETWEEN: ROYAL BANK OF CANADA Applicant - and ONTARIO INC., ONTARIO INC. and ONTARIO INC. Respondents RECEIVER'S CERTIFICATE RECITALS (A) Pursuant to an Order of the Honourable Mr. Justice Newbould of the Ontario Superior Court of Justice (Commercial List) (the "Court") dated December 2, 2014, BDO Canada Limited ("BDO") was appointed as receiver (in such capacity, the "Receiver"), without security, of all of the assets, undertakings and properties of Ontario Inc., Ontario Inc. and Ontario Inc. (collectively, the "Debtors"). (B) Pursuant to an Order of the Court dated April 8, 2015, the Court approved the agreement of purchase and sale between the Receiver and Robert Nunn dated February 27, 2015 (the "Sale Agreement"), including the amendment thereto pursuant to which title in the property described in the Sale Agreement would be taken in the name of Ontario Limited (the

28 "Purchaser"), and provided for the vesting in the Purchaser, or as the Purchaser may direct, of all of the Debtors' right, title and interest in and to the Purchased Assets (as defined in the Sale Agreement), which vesting is to be effective with respect to the Purchased Assets upon the delivery by the Receiver to the Purchaser of a certificate confirming: (i) the payment by the Purchaser of the purchase price for the Purchased Assets; (ii) that the conditions to closing as set out in the Sale Agreement, as amended, have been satisfied or waived by the Receiver and the Purchaser; and (iii) that the transaction has been completed to the satisfaction of the Receiver. (C) Unless otherwise indicated herein, terms with initial capitals have the meanings set out in the Sale Agreement. THE RECEIVER CERTIFIES the following: 1. the Purchaser has paid and the Receiver has received the purchase price for the Purchased Assets payable on the closing date pursuant to the Sale Agreement, as amended; 2. the conditions to closing as set out in the Sale Agreement, as amended, have been satisfied or waived by the Receiver and the Purchaser; 3. the transaction has been completed to the satisfaction of the Receiver; and 4. this Certificate was delivered by the Receiver at [TIME] on [DATE],

29 BDO CANADA LIMITED, solely in its capacity as the Court-appointed receiver of all of the assets, undertakings and properties of Ontario Inc., Ontario Inc. and Ontario Inc. Per: Name: Title:

30 SCHEDULE"B" LEGAL DESCRIPTION OF PROPERTY PIN Legal Description (LT) Part Block Q, Plan 7 Huntsville and Part of Fetterley Street, Plan 7 Huntsville designated as Part 2, Plan 35R-3359; Town of Huntsville, The District Municipality of Muskoka

31 SCHEDULE"C" INSTRUMENTS TO BE DELETED FROM TITLE TO PROPERTY 1. Instrument No. MT10106 being a Transfer registered November 15, 2005 in favour of Ontario Inc. 2. Instrument No. MT15621 being a Charge registered March 31, 2006 in favour of The Royal Bank of Canada. 3. Instrument No. MT being a Charge registered June 12, 2014 in favour of Royal Bank of Canada. 4. Instrument No. MT being an Application to register Court Order registered December 3, 2014 in favour of BDO Canada Limited.

32 SCHEDULE"D" PERMITTED ENCUMBRANCES, EASEMENTS AND RESTRICTIVE COVENANTS 1. Reference Plan 35R-3359 registered April 26, 1974.

33 ROYAL BANK OF CANADA - and ONTARIO INC., ONTARIO INC. and ONTARIO INC. Applicant Respondents Court File No. CV CL ONTARIO SUPERIOR COURT OF JUSTICE COMMERCIAL LIST Proceedings commenced at Toronto APPROVAL AND VESTING ORDER AIRD & BERLIS LLP Barristers and Solicitors Brookfield Place 181 Bay Street, Suite 1800 Toronto, ON M5J 2T9 Steven L. Graff (LSUC # 31871V) Tel: (416) Fax: (416) S2raff(3),airdberlis.com Ian Aversa (LSUC # 55449N) Tel: (416) Fax: (416) iaversa,airdberlis.com Lawyers for BDO Canada Limited, in its capacity as the Courtappointed receiver of Ontario Inc., Ontario Inc. and Ontario Inc.

34 TAB 3

35 Revised; January 21, 20lA Court File No. -CV CL ONTARIO SUPERIOR COURT OF JUSTICE COMMERCIAL LIST THE HONOURABLE DAY, THE DAY.JUSTICE OF,20 THE HONOURABLE WEDNESDAY. THE 8 th DAY JUSTICE OF APRIL BETWEEN Plaintiff ROYAL RANK OF CANADA Annlicant and 1_ ONTARIO INC ONTARIO INC. and ONTARIO INC. Respondents APPROVAL AND VESTING ORDER ;>!K Sink: l.v.mov.i.i

36 =2^ THIS MOTION, made by frbobiv-rr's NAME^BDO Canada Limited, in its capacity as the Court-appointed receiver tin such capacity, the ""Receiver^'h. without security, of all of the undertaking, proneftv-and assets of FDRRTORI (the "Debter^assets. undertakings and nronerties of Ontario Inc Ontario Inc. and Ontario Inc. fcollectively, the "Debtors") for an order, inter alia, approving the sale transaction (the -"Transaction-") contemplated by an agreement of purchase and sale (the "Sale Agreement") between the Receiver^ as vendor, and {NAME OF PURCHASER] (the "Purchaser") dated [DATE] and appended to therohert Nunn C"Nunn"). as purchaser, dated February tthe "Sale Agreement"), a conv of which Sale Agreement is attached as Confidential Appendix "K" to the First Report of the Receiver dated i-datkimarch (the "Renort"h-and >^^teu--in--tee--p-i:tfehaser"first Report") and which Sale Agreement was subsequently amended to provide that all of the Debtor's right, title and interest in and to the assetsnronertv described in the Sale Agreement (the "Purchas^d-AsseteN'Turchased Assets") would be taken in the name of Ontario Limited tthe "Purchaser"), and vesting in the Purchaser, or as it mav direct, all of the Debtors' right, title and interest in and to the Purchased Assets, was heard this day at 330 University Avenue, Toronto, Ontario, ON READING the First Report and appendices thereto, and on hearing the submissions of counsel for the Receiver. INAMES OF OTHER. PARTIES APPEARING^ and such other counsel as were present, no one appearing for any other person named on the service list, although properly DO!. S I OR. L'OK'V.M

37 =3^ served as appears from the affidavit of fnamfifmona Markussen sworn [DATElMarch filed 1!-; 1. THIS COURT ORDERS AND DECLARES that the Transaction is hereby approved, 3 and the execution of the Sale Agreement, as amended, by the Receive/ is hereby authorized and approved, with such minor amendments as the Receiver may deem necessary. The Receiver is hereby authorized and directed to take such additional steps and execute such additional documents as may be necessary or desirable for the completion of the Transaction and for the conveyance of the Purchased Assets to the Purchaser, or as it mav direct. 2. THIS COURT ORDERS AND DECLARES that upon the delivery of a Receiver's certificate to the Purchaser substantially in the form attached as Schedule "A" hereto (the -"Receiver's Certificate-'), all of the Debtor'sDebtors' right, title and interest in and to the Purchased Assets described in the Sale Agreement-land listed on Schedule B heretol 4. as amended. shall vest absolutely in the Purchaser, or as it mav direct, free and clear of and from any and all security interests (whether contractual, statutory, or otherwise), hypothecs, mortgages, trusts or deemed trusts (whether contractual, statutory, or otherwise), liens, executions, levies, charges, or should be served on all persaas having an eogbomic interest in the Purchased Assets, unless circumstances warrant a different approach. Counsel should consider attaching the affidavit of service to this Order. 4n-soffle cases, notably^vherc this Order moy-be-retied-apen for proeccdings in the United States, a finding that the ~ In some cases, the Debtor will be the vendor under the Sale Agreement, or otherwise actively involved in the the Receiver to execute and deliver documents, and take other stepsr 4: Fe-ati-ow this Order-te-be free standing (and-net-require referenoe-te-the-geuit record and/or the Sale Agreementfrk!>(K SIOK L'ulWM-l

38 =4^ other financial or monetary claims, whether or not they have attached or been perfected, registered or filed and whether secured, unsecured or otherwise (collectively, the -"Claims- 5 ")^ including, without limiting the generality of the foregoing: (i) any encumbrances or charges created by the Order of the Honourable Mr. Justice IN AM-HINewbou 1 d dated rdateldecember : (ii) all charges, security interests or claims evidenced by registrations pursuant to the Personal Property Security Act (Ontario) or any other personal property registry system; and (iii) those Claims listed on Schedule "C" hereto (all of which are collectively referred to as the -"Encumbrances-", which term shall not include the permitted encumbrances, easements and restrictive covenants listed on Schedule "D") and, for greater certainty, this Court orders that all of the Encumbrances affecting or relating to the Purchased Assets are hereby expunged and discharged as against the Purchased Assets, 3. THIS COURT ORDERS that upon the registration in the Land Registry Office for the {Registry Division of (LOCATION) of a Transfer/Deed of Land in the form prescribed by the Land Registration Reform Act duly executed bv the Rcccivci-haoproDriate Land Titles Division-ef {LOCATION) of an Application for Vesting Order in the form prescribed by the Land Titles Act and/or the Land Registration Reform Actf, the Land Registrar is hereby directed to enter the Purchaser, or as it mav direct, as the owner of the subject real property identified in Schedule "B" hereto (the "Real Property") in fee simple, and is hereby directed to delete and expunge from title to the Real Property all of the Claims listed in Schedule "C" hereto. g The "Claims"-being vested out may, in some cases, include ownership claims, where ownership is disputed and-the dispute is brought to the attention of the-gewu-sueh-ewftership claims-would, in that case, still contiiwe as against t-he Geurt-L-advised what rights tire being affected, and the appropriate persons are served. It is the Subcommittee's view that-a-ren specific vesting out of "rights, titles and interests" is vague and therefore undesirable.

39 =5^ 4. THIS COURT ORDERS that for the purposes of determining the nature and priority of Claims, the net proceeds 7 from the sale of the Purchased Assets shall stand in the place and stead of the Purchased Assets, and that from and after the delivery of the Receiver's Certificate all Claims and Encumbrances shall attach to the net proceeds from the sale of the Purchased Assets with the same priority as they had with respect to the Purchased Assets immediately prior to the sale 8, as if the Purchased Assets had not been sold and remained in the possession or control of the person having that possession or control immediately prior to the sale. 5. THIS COURT ORDERS AND DIRECTS the Receiver to file with the Court a copy of the Receiver's Certificate, forthwith after delivery thereof. 6. THIS COURT ORDERS that, pursuant to clause 7(3)(c) of the Canada Personal Information Protection and Electronic Documents Act, the Receiver is authorized and permitted to disclose and transfer to the Purchaser all human resources and payroll information in the Comnanv'sDebtors" records pertaining to the Debtor'sDebtors' past and current employees^ mekiding personal information of those employees listed on Schedule to the Sale Agreement. The Purchaser shall maintain and protect the privacy of such information and shall be entitled to use the personal information provided to it in a manner which is in all material respects identical to the prior use of such information by the Debtor. The Repert should identity the dispesition costs and any other costs which should be paid from the gross sale -This-pfevision crystatfees the date as oavhteh4hetglaihis^a4llte^etemwied. If a sate-eccurs early in the-mserefley preeess. or petentially-secured claimants may not have had the time or the-ahility to register or perfect proper-vfeims boosto-fe-iametvw

40 =6= 7. THIS COURT ORDERS that, notwithstanding: (a) the pendency of these proceedings; (b) any applications for a bankruptcy order now or hereafter issued pursuant to the Bankruptcy and Insolvency Act (Canada) in respect of the SebtorDebtors and any bankruptcy order issued pursuant to any such applications; and (c) any assignment in bankruptcy made in respect of the DebtonDebtors. the vesting of the Purchased Assets in the Purchaser, or as it mav direct, pursuant to this Order shall be binding on any trustee in bankruptcy that may be appointed in respect of the DebtorDebtors and shall not be void or voidable by creditors of the PebtorDebtors. nor shall it constitute nor be deemed to be a fraudulent preference, assignment, fraudulent conveyance, transfer at undervalue T or other reviewable transaction under the Bankruptcy and Insolvency Act (Canada) or any other applicable federal or provincial legislation, nor shall it constitute oppressive or unfairly prejudicial conduct pursuant to any applicable federal or provincial legislation. 8. THIS COURT ORDERS AND DECLARES that the Transaction is exempt from the application of the Bulk Sales Act (Ontario). 9. THIS COURT HEREBY REQUESTS the aid and recognition of any court, tribunal, regulatory or administrative body having jurisdiction in Canada or in the United States to give effect to this Order and to assist the Receiver and its agents in carrying out the terms of this Order, All courts, tribunals, regulatory and administrative bodies are hereby respectfully requested to make such orders and to provide such assistance to the Receiver, as an officer of this Court, as may D'vsnm. i Viivwu

41 =7= be necessary or desirable to give effect to this Order or to assist the Receiver and its agents in carrying out the terms of this Order. IKK MOR. HOiv'.' 7 1-i

42 Revised: January 21, 2014 Schedule "A" - Form of Receiver's Certificate Court File No. -CV CL ONTARIO SUPERIOR COURT OF JUSTICE COMMERCIAL LIST RF.TWEEN: ROYAL BANK OF CANADA Applicant BETWEEN: PLAINTIFF Plaintiff - and -z REFENBANT 1T ONTARIO INC ONTARIO INC. and ONTARIO INC. Respondents RECEIVER'S CERTIFICATE RECITALS (A) An Pursuant to an Order of the Honourable fname OF JUDGElMr. Justice Newbould of the Ontario Superior Court of Justice ("Commercial List) (the "Court") dated [DATE OF OROERATNAMEAJF RECEIVER.1 "Court") dated December BDO Canada Limited P'BDO'h was appointed as the receiver tin such capacity, the -"Receiver^"), without security, of all of the undcrtakinp. property and assets of [DEBTOR! tthe "Debterassets. undertakings and DI M SIOR. IWWl-l

43 properties of Ontario Inc Ontario Inc. and Ontario Inc. ("collectively, the "Debtors"). (D) Eh Pursuant to an Order of the Court dated TDATEl.April the Court approved the agreement of purchase and sale made as of [DATE OF AGREEMENT] (the "Sate Agreement") between the Receiver EOebtorl and FNAMB OF PURCHASERl (the "Purchasert-and Robert Nunn dated February (the "Sale Agreement"), including the amendment thereto pursuant to which title in the property described in the Sale Agreement would be taken in the name of Ontario Limited ("the "Purchaser"), and provided for the vesting in the Purchaser of the Pebtert-s. or as the Purchaser mav direct, of all of the Debtors' right, title and interest in and to the Purchased Assets fas defined in the Sale Agreement), which vesting is to be effective with respect to the Purchased Assets upon the delivery by the Receiver to the Purchaser of a certificate confirming: (i) the payment by the Purchaser of the Purchase Pricepurchase price for the Purchased Assets; (ii) that the conditions to Closinaclosing as set out in section -ot'-the Sale Agreement, as amended, have been satisfied or waived by the Receiver and the Purchaser; and (iii) that the Transactiontransaction has been completed to the satisfaction of the Receiver. CO G-. Unless otherwise indicated herein, terms with initial capitals have the meanings set out in the Sale Agreement. THE RECEIVER CERTIFIES the following: JL U 'Ihethe Purchaser has paid and the Receiver has received the Purchase firteepurchase price for the Purchased Assets payable on the Closing Dateclosing date pursuant to the Sale Agreement, as amended: PCX SiOk:

44 2, i Thethe conditions to Closingclosing as set out in section -ef the Sale Agreement. as amended, have been satisfied or waived by the Receiver and the Purchaser;-and 2^ A The Transactionthe transaction has been completed to the satisfaction of the Receiver.; and ff 4-. Thrsthis Certificate was delivered by the Receiver at [TIME] on _ === [DATE]. {NAME E REITEtMERhrBDO LIMITED, solely in its capacity as CANADA Court-annointed receiver of all of the assets, undertakings and nronerties of Ontario Inc Ontario Inc. and Ontario Inc. Per: Name: Title: OiK SiDK: I.VUv.r.' 1-1

45 SCHEDULE"B» LEGAT, DESCRIPTION OF PROPERTY PIN Lciral Dcscrintion L ('LT'l Part Block 0, Plan 7 Huntsville and Part of Fetterlev Street. Plan 7 Huntsville clesimiated as Part 2. Plan 35R-3359: Town of Huntsville. The District MuniciDalitv of Muskoka UK srok: i-i

46 n SCHEDIIT/E "C" INSTRUMENTS TO RE DELFTED FROM TITI E TO PROPERTY 1. Instrument No. MT10106 being a Transfer registered November in favour of Ontario Inc. 2. Instrument No. MT15621 being a Charge registered March in favour of The Roval Bank of Canada. 3. Instrument No. MT being a Charge registered June in favour of Roval Bank of Canada. 4. Instrument No. MT being an Annlication to register Court Order registered December in favour of BDO Canada Limited.

47 T. SCHEDULE"D" PERMITTED ENCUMBRANCES. EASEMENTS AND RESTRICTIVE COVENANTS 1. Reference Plan 35R-3359 registered April DQ&STOfe-I^O-l 92 7\ 1 '1

48 TAB 4

49 ONTARIO SUPERIOR COURT OF JUSTICE COMMERCIAL LIST Court File No. CV CL THE HONOURABLE JUSTICE ) WEDNESDAY, THE 8 th DAY ) ) OF APRIL, 2015 BETWEEN: ROYAL BANK OF CANADA Applicant - and ONTARIO INC., ONTARIO INC. and ONTARIO INC. Respondents ORDER (re: Ancillary Matters) THIS MOTION, made by BDO Canada Limited ("BDO"), in its capacity as the Courtappointed receiver (in such capacity, the "Receiver"), without security, of all of the assets, undertakings and properties of Ontario Inc., Ontario Inc. and Ontario Inc. (collectively, the "Debtors"), for an order, among other things: (i) approving the First Report of the Receiver dated March 27, 2015 (the "First Report") and the actions of the Receiver set out therein; (ii) authorizing and directing the Receiver to distribute, without further Order of this Court, certain funds on account of the Debtors' secured indebtedness for principal, interest and costs, and certain funds on account of accrued municipal property tax arrears; (iii)

50 approving the fees and disbursements of the Receiver and its counsel, including an accrual for fees and disbursements to be incurred to the completion of these proceedings; (iv) approving the Receiver's Interim Statement of Receipts and Disbursements (as appended to the First Report); (v) authorizing and directing the Receiver to dispose of certain of the Debtors' books and records; and (vi) sealing Confidential Appendices "A" through "K" (collectively, the "Confidential Appendices"), was heard this day at 330 University Avenue, Toronto, Ontario. ON READING the First Report and the appendices thereto, the affidavit of Yince Siciliano sworn March 26, 2015 and the affidavit of Steven L. Graff sworn March 26, 2015, and on hearing the submissions of counsel for the Receiver and such other counsel as were present, no one appearing for any other person named on the service list, although properly served as appears from the affidavit of Mona Markussen sworn March 27, 2015, filed, 1. THIS COURT ORDERS that the time for service and filing of the notice of motion and the motion record is hereby abridged and validated so that this motion is properly returnable today and hereby dispenses with further service thereof. 2. THIS COURT ORDERS that the First Report be and is hereby approved and the actions of the Receiver described therein be and are hereby approved. 3. THIS COURT ORDERS that the Receiver be and is hereby authorized and directed to make distributions to Royal Bank of Canada ("RBC"), without further Order of this Court, on account of the Debtors' secured indebtedness owing to RBC for principal, interest and costs up to the amount of the Debtors' secured indebtedness owing to RBC.

51 3 4. THIS COURT ORDERS that the Receiver be and is hereby authorized and directed to make distributions to the Corporation of the Town of Huntsville, without further Order of this Court, on account of accrued municipal property tax arrears in respect of the Huntsville Location (as defined in the First Report), up to the amount of the aforesaid accrued municipal property tax arrears and any associated interest and fees. 5. THIS COURT ORDERS that the Receiver's Interim Statement of Receipts and Disbursements, as appended to the First Report, be and is hereby approved. 6. THIS COURT ORDERS that the fees and disbursements of the Receiver for the period of November 14, 2014 to and including March 24, 2015, in the amount of $63,811,69, inclusive of applicable HST, be and are hereby approved. 7. THIS COURT ORDERS that the fees and disbursements of the Receiver's legal counsel, Aird & Berlis LLP, for the period of November 14, 2014 to and including March 20, 2015, in the amount of $17,367.51, inclusive of applicable HST, be and are hereby approved. 8. THIS COURT ORDERS that the Fee Accrual (as defined in the First Report) be and is hereby approved, 9. THIS COURT ORDERS that the Receiver be and is hereby authorized and directed to dispose of the Debtors' books and records that are in the Receiver's possession and that were retrieved from the Burlington Location (as defined in the First Report), but only to the extent that such books and records, in the Receiver's view, are unnecessary to complete the Receiver's mandate.

52 4 10. THIS COURT ORDERS that the Confidential Appendices be and are hereby sealed until further Order of this Court.

53 ROYAL BANK OF CANADA - and ONTARIO INC., ONTARIO INC. and ONTARIO INC. Applicant Respondents Court File No. CV CL ONTARIO SUPERIOR COURT OF JUSTICE COMMERCIAL LIST Proceedings commenced at Toronto ORDER (re: Ancillary Matters) AIRD & BERLIS LLP Barristers and Solicitors Brookfield Place 181 Bay Street, Suite 1800 Toronto, ON M5J 2T9 Steven L. Graff (LSUC #31871V) Tel: (416) Fax: (416) sgraff@,airdberlis.com Ian Aversa (LSUC # 55449N) Tel: (416) Fax: (416) iaversa@airdberlis.com Lawyers for BDO Canada Limited, in its capacity as the Court-appointed receiver of Ontario Inc., Ontario Inc. and Ontario Inc.

54 TAB 5

55 ONTARIO SUPERIOR COURT OF JUSTICE COMMERCIAL LIST Court File No. CV CL THE HONOURABLE ) WEDNESDAY, THE 8 th DAY ) JUSTICE ) OF APRIL, 2015 BETWEEN : ROYAL BANK OF CANADA Applicant - and ONTARIO INC., ONTARIO INC. and ONTARIO INC. Respondents DISCHARGE ORDER THIS MOTION, made by BDO Canada Limited ("BDO"), in its capacity as the Courtappointed receiver (in such capacity, the "Receiver"), without security, of all of the assets, undertakings and properties of Ontario Inc., Ontario Inc. and Ontario Inc. (collectively, the "Debtors"), for an Order, among other things: (i) discharging BDO as Receiver of the assets, undertakings and properties of the Debtors effective upon the filing of a certificate by the Receiver certifying that all matters to be attended to in connection with the receivership of the Debtors have been completed to the satisfaction of the Receiver, in substantially the form attached hereto as Schedule "A" (the "Discharge Certificate"); and (ii)

56 2 releasing BDO from any and all liability, as set out in paragraph 2 of this Order, was heard this day at 330 University Avenue, Toronto, Ontario. ON READING the First Report of the Receiver dated March 27, 2015 and the appendices thereto, and on hearing the submissions of counsel for the Receiver and such other counsel as were present, no one appearing for any other person named on the service list, although properly served as appears from the affidavit of Mona Markussen sworn March 27, 2015, filed, 1. THIS COURT ORDERS that, upon the Receiver filing the Discharge Certificate, the Receiver shall be discharged as Receiver of the assets, undertakings and properties of the Debtors, provided however that notwithstanding its discharge herein: (a) the Receiver shall remain Receiver for the performance of such incidental duties as may be required to complete the administration of the receivership herein; and (b) the Receiver shall continue to have the benefit of the provisions of all Orders made in this proceeding, including all approvals, protections and stays of proceedings in favour of BDO Canada Limited, in its capacity as Receiver. 2. THIS COURT ORDERS AND DECLARES that, upon the Receiver filing the Discharge Certificate, BDO is hereby released and discharged from any and all liability that BDO now has or may hereafter have by reason of, or in any way arising out of, the acts or omissions of BDO while acting in its capacity as Receiver herein, save and except for any gross negligence or wilful misconduct on the Receiver's part. Without limiting the generality of the foregoing, BDO is hereby forever released and discharged from any and all liability relating to matters that were

57 3 raised, or which could have been raised, in the within receivership proceedings, save and except for any gross negligence or wilful misconduct on the Receiver's part.

58 SCHEDULE"A" ONTARIO SUPERIOR COURT OF JUSTICE COMMERCIAL LIST Court File No. CV CL BETWEEN: ROYAL BANK OF CANADA Applicant - and ONTARIO INC., ONTARIO INC. and ONTARIO INC. Respondents RECEIVER'S DISCHARGE CERTIFICATE RECITALS (A) Pursuant to an Order of the Honourable Mr. Justice Newbould of the Ontario Superior Court of Justice (Commercial List) (the "Court") dated December 2, 2014, BDO Canada Limited ("BDO") was appointed as receiver (in such capacity, the "Receiver"), without security, of all of the assets, undertakings and properties of Ontario Inc., Ontario Inc. and Ontario Inc. (collectively, the "Debtors"). (B) Pursuant to an Order of the Court dated April 8, 2015 (the "Discharge Order"), BDO was discharged as Receiver of all of the assets, undertakings and properties of the Debtors to be effective upon the filing by the Receiver with the Court of a certificate confirming that all matters to be attended to in connection with the receivership of the Debtors have been completed

59 to the satisfaction of the Receiver, provided, however, that notwithstanding its discharge: (a) the Receiver will remain Receiver for the performance of such incidental duties as may be required to complete the administration of the receivership; and (b) the Receiver will continue to have the benefit of the provisions of all Orders made in this proceeding, including all approvals, protections and stays of proceedings in favour of EDO Canada Limited, in its capacity as Receiver. (C) Unless otherwise indicated herein, terms with initial capitals have the meanings set out in the Discharge Order. THE RECEIVER CERTIFIES the following: 1. All matters to be attended to in connection with the receivership of the Debtor have been completed to the satisfaction of the Receiver; and 2, This Certificate was filed by the Receiver with the Court on the day of, EDO CANADA LIMITED, solely in its capacity as the Court-appointed receiver of all of the assets, undertakings and properties of Ontario Inc., Ontario Inc. and Ontario Inc., and not in its personal capacity Per: Name: Title:

60 ROYAL BANK OF CANADA - and ONTARIO INC., ONTARIO INC. and ONTARIO INC. Applicant Respondents Court File No. CV CL ONTARIO SUPERIOR COURT OF JUSTICE COMMERCIAL LIST Proceedings commenced at Toronto DISCHARGE ORDER AIRD & BERLIS LLP Barristers and Solicitors Brookfield Place 181 Bay Street, Suite 1800 Toronto, ON M5J2T9 Steven L. Graff (LSUC #31871V) Tel: (416) Fax: (416) SCTaff@airdberlis.com Ian Aversa (LSUC # 55449N) Tel: (416) Fax: (416) iaversa@.airdberlis.com Lawyers for EDO Canada Limited, in its capacity as the Courtappointed receiver of Ontario Inc., Ontario Inc. and Ontario Inc.

61 i TAB 6 i

62 Re-\4se6k-Ma^4 1,2010 Court File No. -CV CL ONTARIO SUPERIOR COURT OF JUSTICE COMMERCIAL LIST TH&FIONOURA-B-Lfi- WBEKDAYrTHE-# wstice- DAY OF MONTH, 20YR THE HONOURABLE WEDNESDAY. THE 8 th DAY.JUSTICE OF APRIL BETWEEN : Plaintiff ROYAL BANK OF CANADA Armlicant and ONTARIO INC ONTARIO INC. and ONTARIO INC. Respondents DISCHARGE ORDER!HX \!:'unu5-.s

63 2 THIS MOTION, made by f-r-rcrivrr's bj-amb-trdo Canada Limited f u BDO"T in its capacity as the Court-appointed receiver tin such capacity, the -"Receiver 1^"! without security, of all of the-un4ertal4ng, prepeft^-and assets of IDEBTORd t. undertakings and properties of Ontario Inc Ontario Inc. and Ontario Inc. tcollectivelv. the "Debtar^'Debtors"!. for an orderorder. among other things: h apprwing the activities of the Rcccivei--as-set-out in the repercerdhe-receiver dated [DATE] (the "ReperOt 2-. approving the fees and disbursements of the Receiver and its counsel; fa nd ] 4-7-tit discharging I RECEIVER'S NAME1BDO as Receiver of the undertaking, property and assets ertbe4dehterfi-smd tt releasing IRI'XTvlA^RI^hS NAlVIlvlasscts. undertakings and nroperties of the Debtors effective upon the filing of a certificate bv the Receiver certifying that all matters to be attended to in connection with the receivership of the Debtors have been completed to the satisfaction of the Receiver, in substantially the form attached hereto as Schedule "A" ("the "Discharge Certificate"!: and till releasing BDO from any and all liability, as set out in paragraph 52 of this Order] 1, was heard this day at 330 University Avenue, Toronto, Ontario. ON READING the First Report, the affidavits of the Receiver dated March and its counsel as to fees The "Fee Affidavits"The annendices thereto, and on hearing the submissions of counsel for the Receiver and such other counsel as were present, no one else-appearing for any ^du-hr-rcliol'is beittg sought, stakehel4e«n4ieuld-be-spcciileally advked^hd-giveft-ample notie<^-scc also Note T betewr, Siiy.U x

64 3 other person named on the service list, although properly served as cvidc-necd bvappears from the Affiekrvdiaffidavit of INAMElMona Markussen sworn IDATE1.March filed 3^ E THIS CO-URT QRBERS that the activities of the Receiver, as set out in the Reperhr-are 2r, THfS-E'OURT ORDERS that the fees and disbursements of-the Receiver and its counsel, as set out in the Report and the Fee Affidavits, are hereby approved. E THIS-COURT ORDERS that, after payment of the fees and disbursements herein approved, the Receiver shafepay the monies-remaining in Its hands te-fname OEPARTY}^ L T THIS COURT ORDERS that upon payment of-the amonnts-set out in paragraph 3- he-reof [and^ upon the Receiver filing a certificate certifying that it Iras completed the other aetiwities deserrhed in the-reperflthe Discharge Certificate, the Receiver shall be discharged as Receiver of the undertaking, erepertv and assets, undertakings and properties of the BebterDebtors. provided however that notwithstanding its discharge herein: (a) the Receiver shall remain Receiver for the performance of such incidental duties as may be required to complete the administration of the receivership herein^; and (b) the Receiver shall continue to have the benefit of the provisions of all Orders made in this proceeding, including all approvals, protections and stays of proceedings in favour of IRECEIVER'S NAME1BDO Canada Limited, in its capacity as Receiver. 2, 5. [THIS COURT ORDERS AND DECLARES that-trecewer^bhamet upon the Receiver filing the Discharge Certificate. BDO is hereby released and discharged from any and all

65 liability that fregelver^s^lamejbdq now has or may hereafter have by reason of, or in any way arising out of, the acts or omissions of 1R ICC' El-V K M E IB DO while acting in its capacity as Receiver herein, save and except for any gross negligence or wilful misconduct on the Receivei-'s part. Without limiting the generality of the foregoing, VEK'SNAM IvlBDO is hereby forever released and discharged from any and all liability relating to matters that were raised, or which could have been raised, in the within receivership proceedings, save and except for any gross negligence or wilful misconduct on the Receiver's part.} 4 the-receiver has presumably reported its activities to the Court, and presumably the reported activities have been approved in prior Orders. Moreover, the Order that appointed the Receiver likety has protections in favour of the Receiver. These factors tend to indicate that a general release of the Receiver is net necessary. On the other hand, the Receiver has acted only in a representative capacity, as the Court's officer, so the-court may find that it is appreprrate te-msulnte the Receiver from all liability, by way of a general-release. Some members orthe subcommittee felt that; absent a geaerat-retease, Receivers might hold back funds-and/ec-wish to con-duct a claims bar pfecessr-which would tmneeessarityvtdd time and-cost to the receivership. The general release language has been added to this fom-ef BOeSTOfe-43G-l-93^8

66 SCHEDIII/E "A" ONTARIO SUPERIOR COTIRT OF JUSTICE COMMERCTAU LIST Court File No. CV CL BETWEEN: ROYAL BANK OE CANADA Applicant - and ONTARIO INC ONTARIO INC. and ONTARIO INC. 224CO90&74 Respondents RECEIVER'S DISCHARGE CERTIFICATE RECITALS CA1 Pursuant to an Order of the Honourable Mr. Justice Newbould of the Ontario Superior Court of Justice (Commercial List! fthe "Court"! dated December BDO Canada Limited CBDO"! was appointed as receiver tin such capacity, the "Receiver"!, without security, of all of the assets, undertakings and properties of Ontario Inc Ontario Inc. and Ontario Inc. leollectivelv. the "Debtors"!. tbl Pursuant to an Order of the Court dated April fthe "Discharge Order"!. BDO was discharged as Receiver of all of the assets, undertakings and properties of the Debtors to be ettective upon the tiling bv the Receiver with me Court ot a ceitmcate connrmmg mat an matters to be attended to in connection with the receivership of the Debtors have been completed to the

67 2 satisfaction of the Receiver, provided, however, that notwithstanding its discharge: (a) the Receiver will remain Receiver for the performance of such incidental duties as mav be required to complete the administration of the receivership: and Cbt the Receiver will continue to have the benefit of the provisions of all Orders made in this proceeding, including all approvals, protections and stavs of proceedings in favour of EDO Canada Limited, in its capacity as Receiver. (C) Unless otherwise indicated herein, terms with initial capitals have the meanings set out in the Discharge Order. THE RECEIVER CERTIFIES the following: JL All matters to be attended to in connection with the receivership of the Debtor have been completed to the satisfaction of the Receiver: and 2L This Certificate was filed bv the Receiver with the Court on the dav of BDO CANADA LIMIT El), solely in its capacity as the Court-appointed receiver of all of the assets, undertakings and properties of Ontario Inc., Ontario Inc. and Ontario Inc.. and not in its personal capacity Per: Name: Title:

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69 Court File No. CV CL BETWEEN: ONTARIO SUPERIOR COURT OF JUSTICE COMMERCIAL LIST ROYAL BANK OF CANADA Applicant and ONTARIO INC., ONTARIO INC. and ONTARIO INC. Respondents FIRST REPORT OF THE RECEIVER BDO CANADA LIMITED March 27, 2015 BACKGROUND 1. On December 2, 2014, BDO Canada Limited ("BDO") was appointed as receiver (in such capacity, the "Receiver") of all of the assets, undertakings and properties of Ontario Inc. ("113"), Ontario Inc. o/a Surf Paradise ("Surf") and Ontario Inc. ("116", and together with 113 and Surf, the "Debtors") pursuant to an Order (the "Order") of the Ontario Superior Court of Justice (Commercial List) (the "Court"). The Order was made on the application of Royal Bank of Canada ("RBC"). A copy of the Order is attached as Appendix "A". 2. On November 14, 2014, prior to the Order being made, RBC appointed BDO as private receiver (in such capacity, the "Private Receiver") to preserve depletion of its security ahead of its court application. Prior to being appointed as the Private Receiver, BDO had been retained by RBC as a consultant (in such capacity, the "Consultant").

70 113 is an inactive company that filed an assignment in bankruptcy on June 24, msi Spergel inc. was appointed as 113's trustee in bankruptcy. 113 formerly operated as a retailer of snow boards, wake boards, sporting wear and other miscellaneous sporting equipment. The Receiver is not aware of any known assets of is a real estate holding company that owns the real property located at 6 King William Street, Huntsville, Ontario (the "Huntsville Location"). The Huntsville Location consists of a freestanding commercial retail building of approximately 1,440 square feet of space. The Huntsville Location is 116's sole known asset. Surf operated as a retailer of snow boards, wake boards, sporting wear and other miscellaneous sporting equipment. Surf operated from the Huntsville Location and leased premises located at 678 Guelph Line, Burlington, Ontario (the "Burlington Location"). The Receiver is not aware of any formal lease in place as between Surf and 116 for the use of the Huntsville Location. Surf's known assets consist of the following: (a) nominal office furniture and equipment; and (b) various sporting wear and equipment, (collectively, the "Surf Assets"). The Surf Assets together with the Huntsville Location are collectively referred to as the "Assets" and discussed further below. The Debtors are related entities. The Debtors were in default of various financing obligations with RBC and, accordingly, RBC made an application for the appointment of BDO as the Receiver of all the Debtors' Property (as the term "Property" is defined in the Order).

71 DISCLAIMER 9. This report (this "First Report") has been prepared for the use of this Court and the Debtors' stakeholders as general information relating to the Debtors and to assist the Court in making a determination of whether to approve the relief sought by the Receiver. Accordingly, the reader is cautioned that this First Report may not be appropriate for any other purpose. The Receiver assumes no responsibility or liability for losses incurred by the reader as a result of the circulation, publication or use of this First Report contrary to the provisions of this paragraph. 10. All currency references in this First Report are to Canadian dollars unless otherwise noted. INTRODUCTION 11. The purpose of this First Report is to advise the Court on the activities of the Receiver and to obtain an order: (a) approving the agreement of purchase and sale (the "Sale Agreement") between the Receiver, as vendor, and Robert Nunn as purchaser ("Nunn"), dated February 27, 2015 for the sale of the Huntsville Location (which Sale Agreement was subsequently amended to provide that title to the Huntsville Location would be taken in the name of Ontario Limited (the "Purchaser")), and authorizing the Receiver to complete the transaction contemplated thereby (the "Transaction"); (b) vesting in the Purchaser, or a corporation as the Purchaser may direct, 116's rights, title and interest in and to the Huntsville Location, free and clear of any claims and encumbrances; (c) approving this First Report and the actions and activities of the Receiver described herein;

72 - 4 - (d) authorizing and directing the Receiver to distribute to RBC, without further Order of this Court, an amount up to the full indebtedness under RBC's collateral mortgage charge on the Huntsville Location estimated to be $185,000, on account of 116's outstanding indebtedness for principal, interest and costs from the proceeds of the Transaction; (e) authorizing and directing the Receiver to distribute to the Town of Huntsville, without further Order of this Court, certain amounts for accrued municipal property tax arrears on the Huntsville Location, which amounts are estimated to be $7,500 as at the date of this First Report; (f) sealing Confidential Appendices "A" through "K" to the First Report until further order of this Honourable Court; (g) authorizing and directing the Receiver to dispose of the books and records of the Debtors in the Receiver's possession retrieved from the Burlington Location, to the extent that such books and records, in the Receiver's view, are unnecessary to complete its mandate as the Receiver; (h) effective upon the filing of a certificate by the Receiver certifying that all outstanding matters to be attended to in connection with the receivership of the Debtors have been completed to the satisfaction of the Receiver, discharging BDO as Receiver and releasing BDO from any and all liability that BDO has or may hereafter have by reason of, or in any way arising out of, the acts or omissions of BDO while acting in its capacity as the Receiver; (i) approving the Receiver's Interim Statement of Receipts and Disbursements as at March 26, 2015; (j) approving the fees and disbursements of the Receiver and its counsel, including an accrual for fees and disbursements to be incurred to the completion of these proceedings; and

73 (k) such further and other relief as counsel may advise and this Court may permit. TAKING POSSESSION 12. On November 14, 2014, the Private Receiver attended at the Huntsville Location and the Burlington Location to, among other things, take possession of and secure the Huntsville Location and the Burlington Location. The Private Receiver proceeded to investigate for books and records, change the locks and take pictures. 13. The insurer and utilities were notified and appropriate arrangements were made for continued coverage. Additionally, the Private Receiver notified the alarm monitoring company for the Huntsville Location, and replaced the existing alarm codes and emergency contacts with those of the Private Receiver. Burlington Location did not maintain a working alarm. The 14. A property management company was engaged to perform security checks and maintenance to the grounds (i.e. snow clearing) as needed for the Huntsville Location. THE SURF ASSETS AND THE SALE PROCESS Assessment of the Surf Assets 15. As previously noted, the Surf Assets consisted of office furniture and a variety of winter and summer ski and surf sportswear and equipment. The majority of the Surf Assets were the ski and surf sportswear and equipment. The Surf Assets were located at both the Huntsville Location and the Burlington Location. 16. Occupation rent for the Burlington Location was in arrears of approximately $10,600 for the months of October 2014 and November RBC expressed concern over the landlord enforcing its right of distress against the Surf Assets upon receiving notice of the appointment. Accordingly, with the consent of RBC, the Private Receiver immediately engaged Platinum Property Management

74 ("PPM") to remove the Surf Assets from the Burlington Location to a secure storage facility. The Private Receiver communicated with the landlord, and its counsel, and returned the keys in its possession pertaining to the Burlington Location to the landlord. 17. The Surf Assets located at the Huntsville Location remained at the Huntsville Location. 18. Prior to moving the Surf Assets from the Burlington Location, the Private Receiver obtained an inventory report from Surf's electronic records and performed a spot count of various items reported in the books and records to the items on the Burlington Location floor. The spot count performed did not match Surf's records. The physical inventory identified was inconsistent with what had been reported in the books and records. Accordingly, the Receiver commissioned PPM to complete an inventory count of the Surf Assets concurrently with the removal of the Surf Assets. 19. Management of the Debtors advised the Consultant that the last physical inventory count and costing conducted by Surf was in October 2014 (the "October Inventory Report"). Surf provided the Consultant with a copy of the October Inventory Report prior to BDO's appointment as the Private Receiver. The October Inventory Report lists approximately $16,000 individual inventory items with an estimated cost of $607,000. Marketing and Sale of the Surf Assets 20. Pursuant to its powers contained in the Order, the Receiver initiated a sales and marketing process (the "Sale Process") to invite offers to purchase the Assets on an en bloc or on a specific parcel basis. The Sale Process consisted of the following steps: (i) preparing a list of 24 prospective interested parties to contact by telephone and with a "teaser letter", including potential strategic buyers and liquidators;

75 (ii) preparing a form of confidentiality agreement (the "CA") and a confidential information memorandum (the "CIM") to invite offers to purchase the Assets, which included the terms and conditions of a sale and an offer form. A copy of the CIM is attached hereto as Appendix "B"; (iii) signing 15 of the 24 prospective purchasers to the CA to gain access to the CIM. The terms and conditions included in the CIM requested that offers be submitted no later than 5:00 p.m. on January 8, 2015 (the "Offer Deadline"); (iv) placing newspaper advertisements advertising the opportunity in the Barrie and Orillia Examiner, the Burlington Post and the Huntsville Forrester for their respective December 11, 2014 editions. Copies of the respective newspaper notices are attached as Appendix "C"; (v) providing prospective purchasers with access to the Huntsville Location as well as to PPM's storage location to view the Surf Assets that had previously been located at the Burlington Location. Of the 15 interested parties which received the CIM, only six viewed the Surf Assets and none viewed the Huntsville Location; (vi) responding to additional information requests and questions; and (vii) selecting a winning bidder. In addition, the Receiver canvassed the Debtors' former principals for their interest in the Assets. Neither of the principals responded to the Receiver. The Receiver further requested names and contact information of parties that the principals felt may have an interest in the Assets. responded to the Receiver's request. Again, neither individual

76 22. A formal appraisal of the Surf Assets was conducted by Platinum Asset Services ("Platinum"). The formal appraisal, dated December 24, 2014, is attached as Confidential Appendix "A". 23. By the offer deadline, only two offers for the Surf Assets were received, being from Platinum and Algonquin Outfitters ("Algonquin"). No formal offers for the Huntsville Location were received. From the various parties that viewed the Surf Assets, the general consensus was that the inventory was out of style by several years and was mostly clothing. A summary of the offers received is attached as Confidential Appendix "B". 24. Algonquin is one of Surf's direct competitors. In addition, a former store manager for Surf is now employed with Algonquin and has advised the Receiver that he is familiar with the Surf Assets. 25. The Receiver subsequently approached both Algonquin and Platinum and requested that they submit their final and best offers prior to January 16, A summary of the final offers received is attached as Confidential Appendix "C". 26. The Receiver considered Platinum's final offer as the best offer, and accordingly, the Receiver accepted Platinum's offer. After realization expenses, there is not projected to be any surplus funds available from the sale of the Surf Assets. 27. RBC was kept apprised of the marketing and sale attempts by the Receiver, and RBC concurred with the Receiver's recommended course of action. PROPOSED SALE OF THE HUNTSVILLE LOCATION 28. Prior to the Receiver's appointment, 116 had been attempting to market and sell the Huntsville Location. 116 initially listed the Huntsville Location for sale in May 2014 for a list price of $499,000. Through a series of four subsequent price reductions, the final being October 27, 2014, 116's final listing price for the

77 - 9 - Huntsville Location was $299, was ultimately unable to sell the Huntsville Location. 29. Upon its appointment, the Receiver retained Kitchen and Company Appraisal Services ("Kitchen") to provide the Receiver with an appraisal of the Huntsville Location. On December 10, 2014, Kitchen provided the Receiver with its appraisal report. A copy of the Kitchen appraisal is attached as Confidential Appendix "D". 30. The Receiver canvassed and obtained real estate service proposals (the "Realtor Proposals") from Royal Lepage Lakes of Muskoka Realty ("Royal Lepage") and Coldwell Banker Thompson Real Estate Brokerage ("Coldwell") for the potential listing and marketing of the Huntsville Location. The Realtor Proposals contain, among other things, the best estimates of the listing value of the Huntsville Location based on the realtors experience and commercial market factors. The Realtor Proposals are attached as Confidential Appendix "E". 31. On December 16, 2014, the Receiver entered into a listing agreement for the Huntsville Location with Coldwell (the "Realtor"). The Receiver selected Coldwell's proposal on the basis that it was the more thorough, detailed and informative of the Realtor Proposals, which qualities the Receiver felt would be transferred to Coldwell's marketing efforts. 32. Royal Lepage was the realtor previously retained by 116 to list and market the Huntsville Location. 33. The Realtor's marketing activities to February 27, 2015 included the following: posting the realty listings for the Huntsville Location with the Multiple Listing Services; creating and posting internet marketing brochures and/or other advertising material for the Huntsville Location on various additional websites, including the Realtor's own website; and

78 advertising the Huntsville Location in the local newspaper, the Huntsville Forester. 34. On February 20, 2015, the Realtor presented the Receiver with an initial agreement of purchase and sale for the Huntsville Location from Jo-Anna MacDonald ("MacDonald"). The Receiver viewed the offer as too low to entertain and responded accordingly. A copy of this offer is attached as Confidential Appendix "F". 35. On February 25, 2015, MacDonald submitted a second offer for the Huntsville Location, which the Receiver signed back on February 26, 2015 with an irrevocable date of February 27, MacDonald did not respond to the Receiver's sign back. A copy of the Receiver's sign back is attached as Confidential Appendix "G". 36. On February 28, 2015, the Realtor presented the Receiver with an initial offer from Nunn. On the same date, MacDonald contacted the Realtor to further discuss purchasing the Huntsville Location and the Receiver's sign back. 37. The Receiver instructed the Realtor to contact both Nunn and MacDonald, advise of the competing interests and request their final and best offers for the Huntsville Location. Copies of the competing offers are attached as Confidential Appendices "H" and "I". 38. On March 2, 2015, the Receiver signed back MacDonald's final and best offer, but shortened the requested conditional period. Prior to the sign back, the Realtor had discussions with MacDonald's agent and the shortened conditional period was informally agreed upon. The Receiver's sign back irrevocable date was March 4, A copy of the Receiver's sign back is attached as Confidential Appendix "J". MacDonald subsequently contacted the Realtor to advise that it no longer had an interest in the Huntsville Location. No explanation was provided.

79 The Realtor informed the Receiver that Nunn was still interested. Accordingly, on March 9, 2015, the Receiver and Nunn entered into the Sale Agreement, a copy of which (along with the subsequent amendment to reflect that title to the Huntsville Location would be taken in the name of the Purchaser) is attached as Confidential Appendix "K". 40. On March 10, 2015, Nunn provided the Receiver with Notice of Fulfillment of Conditions, thereby waiving the conditions early. Additionally, Nunn provided an Amendment to Agreement of Purchase of Sale advising that title to the Huntsville Location would be taken in the name of the Purchaser. Receiver's Summary and Recommendations 41. The Receiver believes the offer from Nunn to be fair and commercially reasonable, and should be accepted, for the following reasons: i) the offer is in excess of the appraised value of the Huntsville Location obtained from Kitchen and is a sale in the context of a receivership proceeding; ii) the offer is consistent with the Realtor Proposals received for the Huntsville Location; iii) the Huntsville Location had been previously marketed by 116 since about May 2014, with drastic price reductions; iv) Nunn has provided a deposit totaling $20,000; v) Nunn waived the conditions early; and vi) the offer has a fast closing, minimizing accruing municipal property taxes and maintenance fees. 42. The Receiver believes that interest in the Huntsville Location is limited due to the location and rental potential. Additionally, as the Purchaser's offer is in line with the appraisal received and the Realtor Proposals, the Receiver does not

80 believe that any future offers would meet or exceed the Purchaser's offer. Additionally, the Receiver believes that further marketing attempts may discourage the Purchaser, who wishes to complete the Transaction as quickly as possible. Continuing to market the Huntsville Location would involve further time and expenses, including, but not limited to, monthly insurance premiums, ongoing security checks, continued accruing municipal property tax arrears and interest and continued maintenance. 43. RBC, 116's senior secured creditor, which will likely suffer a significant shortfall, was kept apprised of the marketing and sale attempts of the Huntsville Location by the Receiver. RBC is strongly in favour of proceeding with the Transaction. 44. The Receiver requests that the Court approve the sale of the Huntsville Location pursuant to the terms and conditions of the Sale Agreement, as modified to reflect that title is to be taken in the name of the Purchaser. SEALING ORDER 45. The Receiver is of the view that the Confidential Appendices "A" through "K" should be sealed pending the completion of the sale of the Huntsville Location because disclosure of such information could have a negative effect on further sales efforts in the unlikely event that the Transaction does not close. BOOKS AND RECORDS 46. The Receiver previously retrieved the Debtors' available books and records from the Burlington Location, which the Receiver believed were relevant to the administration of the Debtors' estates. 47. The Receiver subsequently made a request to the principals of the Debtors, George Morrison ("Morrison") and Steve Walsh ("Walsh"), to retrieve whichever remaining books and records of the Debtors they desired. Both Morrison and Walsh have advised the Receiver they have no interest in the remaining Debtors'

81 books and records pertinent to director liabilities and potential future audits and reassessments. 48. Approximately three skids of banker boxes containing the aged books and records of the Debtors remain in the Receiver's possession. Accordingly, the Receiver seeks to dispose of the remaining records it deems unnecessary to complete the administration of these receivership proceedings. SECURED CREDITORS AND SECURITY OPINION 49. The Debtors' senior secured creditor is RBC. 50. Aird fit Berlis LLP, independent legal counsel to the Receiver, has conducted a review of the validity and enforceability of the security granted by the Debtors to RBC. 51. Aird fit Berlis LLP has advised the Receiver that, subject to certain usual qualifications and assumptions in opinions of this nature, the security granted by the Debtors to RBC is a valid and perfected security interest in the personal property of the Debtors. The security opinion is attached as Appendix "D". BORROWING UNDER RECEIVER'S CERTIFICATE 52. The Receiver borrowed $23,000 from RBC (the "Receiver's Borrowings") pursuant to its borrowing powers under the Order to pay ongoing and accruing expenses, including costs incurred to market the Assets, monthly liability insurance and utilities, property appraisal and security. 53. The Receiver intends to repay the Receiver's Borrowings to RBC from the proceeds of the sale of the Huntsville Location. PRIORITY CLAIMS 54. Canada Revenue Agency ("CRA") attended the Receiver's office on March 20, 2015 and completed an audit of the Debtors' books and records to establish any

82 trust claims. As of the date of this First Report, CRA has not filed a property claim with the Receiver in respect of either 116 or Surf, being the Debtors with known assets. 55. The realization of the Surf Assets is insufficient to cover the professional fees of the Receiver and its counsel. Accordingly, there will be no funds available for payment to CRA for any trust claims of Surf. 56. RBC has agreed to reimburse any shortfall in the Receiver's accounts under the Surf administration, from RBC's realization and proceeds under the Sale Agreement. 57. The Receiver has identified and notified six employees of Surf who would each be eligible for unpaid wage claims of up to $2,000 under the Wage Earner Protection Program Act ("WEPPA"), which would then form a priority charge ahead of secured creditors. As of the date of this First Report, four former Surf employees have submitted proofs of claim to the Receiver, indicating that termination pay is the only outstanding liability owed these former employees to date. Accordingly, there is presently no priority claim payable by the Receiver and arising out of WEPPA did not maintain any employees; accordingly, there should be no payroll withholding tax arrears or WEPPA claims. PROPOSED DISTRIBUTIONS 59. RBC maintains priority security interest over the remaining proceeds from the sale of the Assets. Surplus monies, after payment of outstanding municipal property tax arrears, the Receiver's professional fees and disbursements and those of its counsel and any additional priority claims, if any, will be distributed to RBC on account of 116's outstanding indebtedness to RBC. 60. It is anticipated that RBC will suffer a shortfall on its realization of its security from the Assets.

83 PROFESSIONAL FEES AND DISBURSEMENTS 61. The Receiver seeks the approval of its professional fees and disbursements and the fees and disbursements of its legal counsel. 62. The professional fees and disbursements of the Receiver total $63,811.69, inclusive of applicable HST of $7,341.17, for the period of November 14, 2014 to and including March 24, The Receiver's affidavit of fees is attached as Appendix "E". 63. The fees and disbursements of the Receiver's legal counsel, Aird & Berlis LLP, total $17,367.51, inclusive of applicable HST, for the period of November 14, 2014 to and including March 20, Aird & Berlis LLP's affidavit of fees is attached as Appendix "F". 64. The Receiver has reviewed the time entries submitted by Aird St Berlis LLP and believes that the work performed and charges incurred to be appropriate and reasonable. 65. The Receiver further estimates that additional fees and disbursements in the amount of $20,000, exclusive of applicable HST (the "Fee Accrual"), will be incurred by the Receiver and its legal counsel to complete the administration of these receivership proceedings. RECEIVER'S STATEMENT OF RECEIPTS AND DISBURSEMENTS 66. The Receiver's Interim Statement of Receipts and Disbursements is attached hereto as Appendix "G". DISCHARGE OF THE RECEIVER 67. Upon the closing of the Transaction, the Receiver will have substantively completed its mandate having realized upon the Property under its control. Accordingly, the Receiver seeks to be discharged following the approval of the Receiver's conduct and activities, the approval of its accounts, and the

84 distribution of the remaining funds held as reported in this First Report and authorized and directed by this Court. 68. The Receiver is unaware of any party objecting to the proposed discharge of the Receiver. CONCLUSION 69. Upon the closing of the Transaction, the Receiver will have substantively completed its administration of the receivership and there are no other matters of a material nature to be dealt with by the Receiver. Accordingly, the Receiver respectfully recommends that this Court issue an order: (a) approving the Sale Agreement between the Receiver and Nunn, dated February 27, 2015, for the sale of the Huntsville Location (which Sale Agreement was subsequently amended to provide that title to the Huntsville Location would be taken in the name of the Purchaser), and authorizing the Receiver to complete the Transaction; (b) vesting in the Purchaser, or a corporation as the Purchaser may direct, 116's rights, title and interest in and to the Huntsville Location, free and clear of any claims and encumbrances; (c) approving this First Report and the actions and activities of the Receiver described herein; (d) authorizing and directing the Receiver to distribute to RBC, without further Order of this Court, an amount up to the full indebtedness under RBC's collateral mortgage charge on the Huntsville Location estimated to be $185,000, on account of 116's outstanding indebtedness for principal, interest and costs from the proceeds of the Transaction; (e) authorizing and directing the Receiver to distribute to the Town of Huntsville, without further Order of this Court, certain amounts for

85 accrued municipal property tax arrears on the Huntsville Location, which amounts are estimated to be $7,500 as at the date of this First Report; (f) sealing Confidential Appendices "A" through "K" to the First Report until further order of this Honourable Court; (g) authorizing and directing the Receiver to dispose of the books and records of the Debtors in the Receiver's possession retrieved from the Burlington Location, to the extent that such books and records, in the Receiver's view, are unnecessary to complete its mandate as the Receiver; (h) effective upon the filing of a certificate by the Receiver certifying that all outstanding matters to be attended to in connection with the receivership of the Debtors have been completed to the satisfaction of the Receiver, discharging BDO as Receiver and releasing BDO from any and all liability that BDO has or may hereafter have by reason of, or in any way arising out of, the acts or omissions of BDO while acting in its capacity as the Receiver; (i) approving the Receiver's Interim Statement of Receipts and Disbursements as at March 26, 2015; (j) approving the fees and disbursements of the Receiver and its counsel, including an accrual for fees and disbursements to be incurred to the completion of these proceedings; and (k) such further and other relief as counsel may advise and this Court may permit.

86 - 18 All of which is respectfully submitted this 27th day of March, Respectfully submitted, ^0 -ANADA LIMITED, in its capacity as the 'Tr.iir Court -appointed Receiver of Ontario Inc., Ontario Inc. and Ontario Inc. and not in its personal capacity

87 Tab A

88 Ay'-" Court File No, CV CL ONTARIO SUPERIOR COURT OF JUSTICE COMMERCIAL LIST THE HONOURABLE C. ) TUESDAY, THE 2 nd JUSTICE j DAY OF DECEMBER, 2014 ""T~0 u R7>S 1 Ufi ROYAL BANK OF CANADA n\ - and ONTARIO INC., ONTARIO INC. and ONTARIO INC. ORDER (appointing Receiver) Applicant Respondent THIS MOTION made by the Applicant for an Order pursuant to section 243(1) of the Bankruptcy and Insolvency Act, R.S.C, 1985, c. B-3, as amended (the "BIA") and section 101 of the Courts of Justice Act, R.S.O, 1990, c. C.43, as amended (the "CJA") appointing BDO CANADA LIMITED as receiver [and manager] (in such capacities, the "Receiver") without security, of all of the assets, undertakings and properties of ONTARIO INC., ONTARIO INC,, and ONTARIO INC, (the "Debtors") acquired for, or used in relation to a business canied on by the Debtors, was heard this day at 330 University Avenue, Toronto, Ontario. ON READING the affidavit of PETER GORDON sworn November 20, 2014 and the Exhibits thereto and on hearing the submissions of counsel for ROYAL BANK OF CANADA, DOCSTOR ')

89 -2- no one appearing for ONTARIO INC., ONTARIO INC. and ONTARIO INC. although duly served as appears from the affidavit of service of CASSANDRA OSBORNE sworn November 25, 2014 and on reading the consent of BDO CANADA LIMITED to act as the Receiver, SERVICE 1. THIS COURT ORDERS that the time for service of the Notice of Motion and the Motion is hereby abridged and validated so that this motion is properly returnable today and hereby dispenses with further service thereof. APPOINTMENT 2. THIS COURT ORDERS that pursuant to section 243(1) of the BIA and section 101 of the CJA, BDO CANADA LIMITED is hereby appointed Receiver, without security, of all of the assets, undertakings and properties of the Debtors acquired for, or used in relation to a business carried on by the Debtors, including all proceeds thereof (the "Property"). RECEIVER'S POWERS 3. THIS COURT ORDERS that the Receiver is hereby empowered and authorized, but not obligated, to act at once in respect of the Property and, without in any way limiting the generality of the foregoing, the Receiver is hereby expressly empowered and authorized to do any of the following where the Receiver considers it necessary or desirable: (a) to take possession of and exercise control over the Property and any and all proceeds, receipts and disbursements arising out of or from the Property; (b) to receive, preserve, and protect the Property, or any part or parts thereof, including, but not limited to, the changing of locks and security codes, the relocating of Property to safeguard it, the engaging of independent security personnel, the taking of physical inventories and the placement of such insurance coverage as may be necessary or desirable; DOCSTOR' 1771?.)?")

90 -3 - (c) to manage, operate, and carry on the business of the Debtors, including the powers to enter into any agreements, incur any obligations in the ordinary course of business, cease to carry on all or any part of the business, or cease to perform any contracts of the Debtors; (d) to engage consultants, appraisers, agents, experts, auditors, accountants, managers, counsel and such other persons from time to time and on whatever basis, including on a temporary basis, to assist with the exercise of the Receiver's powers and duties, including without limitation those conferred by this Order; (e) to purchase or lease such machinery, equipment, inventories, supplies, premises or other assets to continue the business of the Debtors or any part or parts thereof; (t) to receive and collect all monies and accounts now owed or hereafter owing to the Debtors and to exercise all remedies of the Debtors in collecting such monies, including, without limitation, to enforce any security held by the Debtors; (g) to settle, extend or compromise any indebtedness owing to the Debtors; (h) to execute, assign, issue and endorse documents of whatever nature in respect of any of the Property, whether in the Receiver's name or in the name and on behalf of the Debtors, for any purpose pursuant to this Order; (i) to initiate, prosecute and continue the prosecution of any and all proceedings and to defend all proceedings now pending or hereafter instituted with respect to the Debtors, the Property or the Receiver, and to settle or compromise any such proceedings. The authority hereby conveyed shall extend to such appeals or applications for judicial review in respect of any order or judgment pronounced in any such proceeding; nncsror

91 -4-0) to market any or all of the Property, including advertising and soliciting offers in respect of the Property or any part or parts thereof and negotiating such terms and conditions of sale as the Receiver in its discretion may deem appropriate; (k) to sell, convey, transfer, lease or assign the Property or any part or parts thereof out of the ordinary course of business, (i) without the approval of this Court in respect of any transaction not exceeding $100,000,00, provided that the aggregate consideration for all such transactions does not exceed $200,000,00; and (ii) with the approval of this Court in respect of any transaction in which the purchase price or the aggregate purchase price exceeds the applicable amount set out in the preceding clause; and in each such case notice under subsection 63(4) of the Ontario Personal Property Security Act, [or section 31 of the Ontario Mortgages Act, as the case may be,] shall not be required, and in each case the Ontario Bulk Sales Act shall not apply, (1) to apply for any vesting order or other orders necessary to convey the Property or any part or parts thereof to a purchaser or purchasers thereof, free and clear of any liens or encumbrances affecting such Property; (m) to report to, meet with and discuss with such affected Persons (as defined below) as the Receiver deems appropriate on all matters relating to the Property and the receivership, and to share information, subject to such terms as to confidentiality as the Receiver deems advisable; (n) to register a copy of this Order and any other Orders in respect of the Property against title to any of the Property; (o) to apply for any permits, licences, approvals or permissions as may be required by any governmental authority and any renewals thereof for and ixx'stok rnn.^x;

92 -5 - on behalf of and, if thought desirable by the Receiver, in the name of the Debtors; (p) to enter into agreements with any trustee in bankruptcy appointed in respect of the Debtors, including, without limiting the generality of the foregoing, the ability to enter into occupation agreements for any property owned or leased by the Debtors; (q) to exercise any shareholder, partnership, joint venture or other rights which the Debtors may have; and (r) to take any steps reasonably incidental to the exercise of these powers or the performance of any statutory obligations. and in each case where the Receiver takes any such actions or steps, it shall be exclusively authorized and empowered to do so, to the exclusion of all other Persons (as defined below), including the Debtors, and without interference from any other Person. DUTY TO PROVIDE ACCESS AND CO-OPERATION TO THE RECEIVER 4, THIS COURT ORDERS that (i) the Debtors, (ii) all of its current and former directors, officers, employees, agents, accountants, legal counsel and shareholders, and all other persons acting on its instructions or behalf, and (iii) all other individuals, firms, corporations, governmental bodies or agencies, or other entities having notice of this Order (all of the foregoing, collectively, being "Persons" and each being a "Person") shall forthwith advise the Receiver of the existence of any Property in such Person's possession or control, shall grant immediate and continued access to the Property to the Receiver, and shall deliver all such Property to the Receiver upon the Receiver's request. 5, THIS COURT ORDERS that all Persons shall forthwith advise the Receiver of the existence of any books, documents, securities, contracts, orders, corporate and accounting records, and any other papers, records and information of any kind related to the business or affairs of the Debtors, and any computer programs, computer tapes, computer disks, or other data storage media containing any such information (the foregoing, collectively, the "Records") in nocstor *12'9

93 -6- that Person's possession or control, and shall provide to the Receiver or permit the Receiver to make, retain and take away copies thereof and grant to the Receiver unfettered access to and use of accounting, computer, software and physical facilities relating thereto, provided however that nothing in this paragraph 5 or in paragraph 6 of this Order shall require the delivery of Records, or the granting of access to Records, which may not be disclosed or provided to the Receiver due to the privilege attaching to solicitor-client communication or due to statutory provisions prohibiting such disclosure. 6, THIS COURT ORDERS that if any Records are stored or otherwise contained on a computer or other electronic system of information storage, whether by independent service provider or otherwise, all Persons in possession or control of such Records shall forthwith give unfettered access to the Receiver for the purpose of allowing the Receiver to recover and fully copy all of the information contained therein whether by way of printing the information onto paper or making copies of computer disks or such other manner of retrieving and copying the infonnation as the Receiver in its discretion deems expedient, and shall not alter, erase or destroy any Records without the prior written consent of the Receiver. Further, for the purposes of this paragraph, all Persons shall provide the Receiver with all such assistance in gaining immediate access to the information in the Records as the Receiver may in its discretion require including providing the Receiver with instructions on the use of any computer or other system and providing the Receiver with any and all access codes, account names and account numbers that may be required to gain access to the information, 7. THIS COURT ORDERS that the Receiver shall provide each of the relevant landlords with notice of the Receiver's intention to remove any fixtures from any leased premises at least seven (7) days prior to the date of the intended removal. The relevant landlord shall be entitled to have a representative present in the leased premises to observe such removal and, if the landlord disputes the Receiver's entitlement to remove any such fixture under the provisions of the lease, such fixture shall remain on the premises and shall be dealt with as agreed between any applicable secured creditors, such landlord and the Receiver, or by further Order of this Court upon application by the Receiver on at least two (2) days notice to such landlord and any such secured creditors. nocsror ituwa

94 -7- NO PROCEEDINGS AGAINST THE RECEIVER 8. THIS COURT ORDERS that no proceeding or enforcement process in any court or tribunal (each, a "Proceeding"), shall be commenced or continued against the Receiver except with the written consent of the Receiver or with leave of this Court, NO PROCEEDINGS AGAINST THE DEBTORS OR THE PROPERTY 9. THIS COURT ORDERS that no Proceeding against or in respect of the Debtors or the Property shall be commenced or continued except with the written consent of the Receiver or with leave of this Court and any and all Proceedings currently under way against or in respect of the Debtors or the Property are hereby stayed and suspended pending further Order of this Court. NO EXERCISE OF RIGHTS OR REMEDIES 10. THIS COURT ORDERS that all rights and remedies against the Debtors, the Receiver, or affecting the Property, are hereby stayed and suspended except with the written consent of the Receiver or leave of this Court, provided however that this stay and suspension does not apply in respect of any "eligible financial contract" as defined in the BIA, and further provided that nothing in this paragraph shall (i) empower the Receiver or the Debtors to carry on any business which the Debtors is not lawfully entitled to carry on, (ii) exempt the Receiver or the Debtors from compliance with statutory or regulatory provisions relating to health, safety or the environment, (iii) prevent the filing of any registration to preserve or perfect a security interest, or (iv) prevent the registration of a claim for lien. NO INTERFERENCE WITH THE RECEIVER 11. THIS COURT ORDERS that no Person shall discontinue, fail to honour, alter, interfere with, repudiate, terminate or cease to perform any right, renewal right, contract, agreement, licence or permit in favour of or held by the Debtors, without written consent of the Receiver or leave of this Court. CONTINUATION OF SERVICES 12. THIS COURT ORDERS that all Persons having oral or written agreements with the Debtors or statutory or regulatory mandates for the supply of goods and/or services, including OOCS'tOR I

95 - 8 - without limitation, all computer software, communication and other data services, centralized banking services, payroll services, insurance, transportation services, utility or other services to the Debtors are hereby restrained until further Order of this Court from discontinuing, altering, interfering with or terminating the supply of such goods or services as may be required by the Receiver, and that the Receiver shall be entitled to the continued use of the Debtors' current telephone numbers, facsimile numbers, internet addresses and domain names, provided in each case that the normal prices or charges for all such goods or services received after the date of this Order are paid by the Receiver in accordance with normal payment practices of the Debtors or such other practices as may be agreed upon by the supplier or service provider and the Receiver, or as may be ordered by this Court, RECEIVER TO HOLD FENDS 13, THIS COURT ORDERS that all funds, monies, cheques, instruments, and other forms of payments received or collected by the Receiver from and after the making of this Order from any source whatsoever, including without limitation the sale of all or any of the Property and the collection of any accounts receivable in whole or in part, whether in existence on the date of this Order or hereafter coming into existence, shall be deposited into one or more new accounts to be opened by the Receiver (the "Post Receivership Accounts") and the monies standing to the credit of such Post Receivership Accounts from time to time, net of any disbursements provided for herein, shall be held by the Receiver to be paid in accordance with the terms of this Order or any further Order of this Court. EMPLOYEES 14, THIS COURT ORDERS that all employees of the Debtors shall remain the employees of the Debtors until such time as the Receiver, on the Debtors' behalf, may terminate the employment of such employees, The Receiver shall not be liable for any employee-related liabilities, including any successor employer liabilities as provided for in section 14.06(1,2) of the BIA, other than such amounts as the Receiver may specifically agree in writing to pay, or in respect of its obligations under sections 81.4(5) or 81.6(3) of the BIA or under the IKoge Earner Prated ion Program Act. DOCSTOR 77I742\9

96 -9- PIPEDA 15. THIS COURT ORDERS that, pursuant to clause 7(3)(c) of the Canada Personal Information Protection and Electronic Documents Act, the Receiver shall disclose personal information of identifiable individuals to prospective purchasers or bidders for the Property and to their advisors, but only to the extent desirable or required to negotiate and attempt to complete one or more sales of the Property (each, a "Sale"), Each prospective purchaser or bidder to whom such personal information is disclosed shall maintain and protect the privacy of such information and limit the use of such information to its evaluation of the Sale, and if it does not complete a Sale, shall return all such information to the Receiver, or in the alternative destroy all such information. The purchaser of any Property shall be entitled to continue to use the personal information provided to it, and related to the Property purchased, in a manner which is in all material respects identical to the prior use of such information by the Debtors, and shall return all other personal information to the Receiver, or ensure that all other personal information is destroyed. LIMITATION ON ENVIRONMENTAL LIABILITIES 16, THIS COURT ORDERS that nothing herein contained shall require the Receiver to occupy or to take control, care, charge, possession or management (separately and/or collectively, "Possession") of any of the Property that might be environmentally contaminated, might be a pollutant or a contaminant, or might cause or contribute to a spill, discharge, release or deposit of a substance contrary to any federal, provincial or other law respecting the protection, conservation, enhancement, remediation or rehabilitation of the environment or relating to the disposal of waste or other contamination including, without limitation, the Canadian Environmental Protection Act, the Ontario Environmental Protection Act, the Ontario Water Resources Act, or the Ontario Occupational Health and Safety Act and regulations thereunder (the "Environmental Legislation"), provided however that nothing herein shall exempt the Receiver from any duty to report or make disclosure imposed by applicable Environmental Legislation, The Receiver shall not, as a result of this Order or anything done in pursuance of the Receiver's duties and powers under this Order, be deemed to be in Possession of any of the Property within the meaning of any Environmental Legislation, unless it is actually in possession, doc's i'ok 77p.?.<)

97 - 10- L1M1TATION ON THE RECEIVER'S LIABILITY 17. THIS COURT ORDERS that the Receiver shall incur no liability or obligation as a result of its appointment or the carrying out the provisions of this Order, save and except for any gross negligence or wilful misconduct on its part, or in respect of its obligations under sections 81.4(5) or 81.6(3) of the BIA or under the Wage Earner Protection Program Act. Nothing in this Order shall derogate from the protections afforded the Receiver by section of the BIA or by any other applicable legislation. RECEIVER'S ACCOUNTS 18. THIS COURT ORDERS that the Receiver and counsel to the Receiver shall be paid their reasonable fees and disbursements, in each case at their standard rates and charges unless otherwise ordered by the Court on the passing of accounts, and that the Receiver and counsel to the Receiver shall be entitled to and are hereby granted a charge (the "Receiver's Charge") on the Property, as security for such fees and disbursements, both before and after the making of this Order in respect of these proceedings, and that the Receiver's Charge shall form a first charge on the Property in priority to all security interests, trusts, liens, charges and encumbrances, statutory or otherwise, in favour of any Person, but subject to sections 14.06(7), 81.4(4), and 81.6(2) of the BIA. 19. THIS COURT ORDERS that the Receiver and its legal counsel shall pass its accounts from time to time, and for this purpose the accounts of the Receiver and its legal counsel are hereby referred to a judge of the Commercial List of the Ontario Superior Court of Justice. 20. THIS COURT ORDERS that prior to the passing of its accounts, the Receiver shall be at liberty from time to time to apply reasonable amounts, out of the monies in its hands, against its fees and disbursements, including legal fees and disbursements, incurred at the standard rates and charges of the Receiver or its counsel, and such amounts shall constitute advances against its remuneration and disbursements when and as approved by this Court. FUNDING OF THE RECEIVERSHIP 21. THIS COURT ORDERS that the Receiver be at liberty and it is hereby empowered to borrow by way of a revolving credit or otherwise, such monies from time to time as it may hocstor it?17.12*9

98 -11 - consider necessary or desirable, provided that the outstanding principal amount does not exceed $200, (or such greater amount as this Court may by further Order authorize) at any time, at such rate or rates of interest as it deems advisable for such period or periods of time as it may arrange, for the purpose of funding the exercise of the powers and duties conferred upon the Receiver by this Order, including interim expenditures. The whole of the Property shall be and is hereby charged by way of a fixed and specific charge (the "Receiver's Borrowings Charge") as security for the payment of the monies borrowed, together with interest and charges thereon, in priority to all security interests, trusts, liens, charges and encumbrances, statutory or otherwise, in favour of any Person, but subordinate in priority to the Receiver's Charge and the charges as set out in sections 14.06(7), 81.4(4), and 81.6(2) of the BIA. 22. THIS COURT ORDERS that neither the Receiver's Borrowings Charge nor any other security granted by the Receiver in connection with its borrowings under this Order shall be enforced without leave of this Court. 23. THIS COURT ORDERS that the Receiver is at liberty and authorized to issue certificates substantially in the form annexed as Schedule "A" hereto (the "Receiver's Certificates") for any amount borrowed by it pursuant to this Order. 24. THIS COURT ORDERS that the monies from time to time borrowed by the Receiver pursuant to this Order or any further order of this Court and any and all Receiver's Certificates evidencing the same or any part thereof shall rank on a pari passu basis, unless otherwise agreed to by the holders of any prior issued Receiver's Certificates. SERVICE AND NOTICE 25. THIS COURT ORDERS that the E-Service Protocol of the Commercial List (the "Protocol") is approved and adopted by reference herein and, in this proceeding, the service of documents made in accordance with the Protocol (which can be found on the Commercial List website at shall be valid and effective service. Subject to Rule this Order shall constitute an order for substituted service pursuant to Rule of the Rules of Civil Procedure, Subject to Rule 3.01(d) of the Rules of Civil Procedure and paragraph 21 of the Protocol, service of documents in accordance with the Protocol will be effective on transmission. This Court further DOCS FOR P7!7..r,q

99 - 12- orders that a Case Website shall be established in accordance with the Protocol with the following URL THIS COURT ORDERS that if the service or distribution of documents in accordance with the Protocol is not practicable, the Receiver is at liberty to serve or distribute this Order, any other materials and orders in these proceedings, any notices or other correspondence, by forwarding true copies thereof by prepaid ordinary mail, courier, personal delivery or facsimile transmission to the Debtors' creditors or other interested parties at their respective addresses as last shown on the records of the Debtors and that any such service or distribution by courier, personal delivery or facsimile transmission shall be deemed to be received on the next business day following the date of forwarding thereof, or if sent by ordinary mail, on the third business day after mailing. GENERAL 27. THIS COURT ORDERS that the Receiver may from time to time apply to this Court for advice and directions in the discharge of its powers and duties hereunder, 28. THIS COURT ORDERS that nothing in this Order shall prevent the Receiver from acting as a trustee in bankruptcy of the Debtors. 29. THIS COURT HEREBY REQUESTS the aid and recognition of any court, tribunal, regulatory or administrative body having jurisdiction in Canada or in the United States to give effect to this Order and to assist the Receiver and its agents in carrying out the terms of this Order. All courts, tribunals, regulatory and administrative bodies are hereby respectfully requested to make such orders and to provide such assistance to the Receiver, as an officer of this Court, as may be necessary or desirable to give effect to this Order or to assist the Receiver and its agents in carrying out the terms of this Order, 30. THIS COURT ORDERS that the Receiver be at liberty and is hereby authorized and empowered to apply to any court, tribunal, regulatory or administrative body, wherever located, for the recognition of this Order and for assistance in carrying out the terms of this Order, and that the Receiver is authorized and empowered to act as a representative in respect of the within nnrstoh mmju)

100 proceedings for the purpose of having these proceedings recognized in a jurisdiction outside Canada. 31. THIS COURT ORDERS that the Plaintiff shall have its costs of this motion, up to and including entry and service of this Order, provided for by the terms of the Plaintiff's security or, if not so provided by the Plaintiffs security, then on a substantial indemnity basis to be paid by the Receiver from the Debtors' estate with such priority and at such time as this Court may determine. 32. THIS COURT ORDERS that any interested party may apply to this Court to vary or amend this Order on not less than seven (7) days' notice to the Receiver and to any other party likely to be affected by the order sought or upon such other notice, if any, as this Court may order. "XVw - nocstor PT-C V

101 DOCSTOR: ^ SCHEDULE"A" RECEIVER CERTIFICATE CERTIFICATE NO. AMOUNT $ 1, THIS IS TO CERTIFY that [RECEIVER'S NAME], the receiver (the "Receiver") of the assets, undertakings and properties [DEBTOR'S NAME] acquired for, or used in relation to a business carried on by the Debtor, including all proceeds thereof (collectively, the "Property") appointed by Order of the Ontario Superior Court of Justice (Commercial List) (the "Court") dated the day of, 20 (the "Order") made in an action having Court file number -CL-_ has received as such Receiver from the holder of this certificate (the "Lender") the principal sum of $_, being part of the total principal sum of $ which the Receiver is authorized to borrow under and pursuant to the Order, 2, The principal sum evidenced by this certificate is payable on demand by the Lender with interest thereon calculated and compounded [daily][monthly not in advance on the of each month] after the date hereof at a notional rate per annum equal to the rate of day per cent above the prime commercial lending rate of Bank of from time to time, 3, Such principal sum with interest thereon is, by the terms of the Order, together with the principal sums and interest thereon of all other certificates issued by the Receiver pursuant to the Order or to any further order of the Court, a charge upon the whole of the Property, in priority to the security interests of any other person, but subject to the priority of the charges set out in the Order and in the Bankruptcy and Insolvency Act, and the right of the Receiver to indemnify itself out of such Property in respect of its remuneration and expenses, 4, All sums payable in respect of principal and interest under this certificate are payable at the main office of the Lender at Toronto, Ontario, 5, Until all liability in respect of this certificate has been terminated, no certificates creating charges ranking or purporting to rank in priority to this certificate shall be issued by the Receiver to any person other than the holder of this certificate without the prior written consent of the holder of this certificate, DOf'S I'OROlY'lWlSvS,Model _Reoisivc!ship_Onler_(T R«yes).Uoe

102 -2-6, The charge securing this certificate shall operate so as to permit the Receiver to deal with the Property as authorized by the Order and as authorized by any further or other order of the Court. 7. The Receiver does not undertake, and it is not under any personal liability, to pay any sum in respect of which it may issue certificates under the terms of the Order. DATED the day of, 20. [RECEIVER'S NAME], solely in its capacity as Receiver of the Property, and not in its personal capacity Per: Name: Title: D0& f0r*«' Wl'7t&^fS-Modcl_Rcoeivership_prder_(T Reyes), doc

103 ROYAL BANK OF CANADA Plaintiff -and ONTARIO INC., et al. Defendant Court File No. C\fl CL ONTARIO SUPERIOR COURT OF JUSTICE COMMERCIAL LIST Proceeding commenced at TORONTO ORDER CLARK PEDDLE FLETT BECCARIO Barristers & Solicitors 190 Division Street, Box 340 Wetland, Ontario L3B 5P9 Lawyers for the Defendant Tel # (905) Fax # (905) LSUC #32002M CP*co

104 TabB

105 ;BDO BDO Canada Limited 1 City Centre Drive Suite 1040 Mississauga Ontario Canada L5B1M2 Telephone: (905) Fax: (905) Ontario Inc Ontario Inc Ontario Inc. CONFIDENTIAL INFORMATION MEMORANDUM December 15, 2014

106 Ontario Inc., Ontario Inc. and Ontario Inc. o/a Surf Paradise INDEX 1. Invitation to Offer to Purchase 3 2. Disclaimer 3 3. Background Summary 4 4. Description of Purchased Assets 4 Parcel I - Inventory 5 Parcel II - Property 5 Parcel III - Property and Inventory 5 5. Method of Sale 5 Terms and Conditions 7 Vendor 8 Due Diligence 8 Closing Date 8 No Warranty from Receiver 8 Sales Commission and Taxes 8 6. Viewing of Assets 9 7. List of Additional Appendices 9 APPENDIX "II" - Inventory 10 APPENDIX "III" - Map of Location 11 APPENDIX "IV" -Property Pictures 12 APPENDIX "V" -Offer to Purchase 13

107 1. Invitation to Offer to Purchase On December 2, 2014, the Ontario Superior Court of Justice (Commercial List) (the "Court") issued an order (the "Order") appointing BDO Canada Limited ("BDO") as the receiver (the "Receiver") of Ontario Inc. ("113"), Ontario Inc. ("116") and Ontario Inc. ("Surf", and together with 113 and 116, "Surf Paradise"). The Receiver is inviting offers for the purchase of any or all of the right, title and interest, if any, in and to the assets described herein (the "Purchased Assets") on an "as is, where is" basis without any representations or warranties from the Receiver. Offers must be made in accordance with the terms and conditions attached as Appendix "I". The Receiver reserves the right to negotiate and to enter into an agreement of purchase and sale with any party at any time. The highest, or any offer, may not be accepted. The sale of the Purchased Assets pursuant to this Confidential Information Memorandum ("CIM") will be subject to the approval of the Receiver and the Court. Offers to purchase the Purchased Assets must be submitted in written form in accordance with the terms of this CIM prior to Thursday, January 8, 2015 at 5:00 pm (Toronto time) (the "End Date"). 2. Disclaimer This CIM has been prepared from information available to the Receiver at the time of writing. All information contained herein, including the description of the Purchased Assets for sale and any other financial information enclosed is intended as a guide to prospective purchasers only and does not and shall not be deemed to contain any representations, warranties or conditions, express or implied. The information was obtained from discussions with management, company records and other third party sources. BDO has not audited, reviewed, or otherwise attempted to verify its accuracy or completeness. The recipient of this 3

108 information shall rely and be deemed to have relied on its own judgment, inspection and investigation in evaluating and/or proceeding with any purchase of the Purchased Assets. The information contained herein has been prepared to provide a brief description of the Purchased Assets of Surf Paradise. Receipt of this CIM constitutes the agreement of the recipient to hold in strict confidence and not reproduce or use this information for any purpose other than its own internal review, and to not disclose same to third parties without the prior written consent of the Receiver. Accordingly, none of Surf Paradise, the Receiver or their respective directors, officers, partners, employees, management or advisors shall be liable for any direct, indirect, or consequential loss or damage suffered by any person as a result of relying on any statement or omission in any of the information provided. 3. Background Summary Beginning in 1983, Surf operated as a sporting goods retailer specializing in the sale of wakeboards, paddle boards, snowboards, apparel and other miscellaneous items. Surf operated from leased retail locations in Burlington, Newmarket, Bracebridge, Barrie and Toronto, as well as a retail location owned by 116 in Huntsville, Ontario (the "Premises"). Surf also maintained an online presence taking orders through its website. At the time of the Order, Surf had consolidated its operations to Burlington, Huntsville and online. 4. Description of Purchased Assets The Purchased Assets consists of certain inventory of Surf (the "Inventory") and the Premises. The Receiver cannot and does not make any representations or warranties with respect to the condition of the Purchased Assets. It will be the responsibility of any prospective purchaser to satisfy itself with respect to the condition of the Purchased Assets. 4

109 The following description is attached for the assistance of prospective purchasers of the Purchased Assets, which are separated into parcels should the buyer choose to purchase the Purchased Assets separately: Parcel I - Inventory A complete list of the Inventory is attached as Appendix "II" as well as pictures of the Inventory. Parcel II - Property The Premises has a gross floor area of approximately 1,450 sq ft on a recently constructed wrap around deck. The building is also air conditioned with 400 amp service and includes a storage area as well as a two-piece bathroom. The Premises is located at 6 King William Street in Huntsville, Ontario and is situated in a retail campus located near prime cottage country. A map of the Premises' location is attached as Appendix "III" with pictures of the interior and exterior of the Premises attached as Appendix "IV". Parcel III - Property and Inventory Prospective purchasers are encouraged to submit offers for the Inventory and Premises together. 5. Method of Sale All Offers are to be submitted in writing and must include: 1) the parcel and price contemplated; 2) confirmation of the interested party's financial capacity to complete the offer to purchase (the "Offer"); 3) a list of additional information required by the interested party to complete the Offer; 5

110 4) the name, telephone number and fax number of a contact person who will be available to answer questions which the Receiver may have regarding the Offer; and 5) a certified cheque or bank draft made payable to BDO Canada Limited in an amount equal to 10% of the purchase price (the "Deposit"). All Offers should be addressed to: BDO Canada Limited 1 City Centre Drive, Suite 1040 Mississauga, Ontario L5B 1M2 Attention: Nathan Wong 6

111 APPENDIX "I" Terms and Conditions The Receiver expressly reserves the right to amend this process or to reject any or all Offers or to accept or negotiate with respect to any Offer at any time regardless of its apparent value in relation to any other Offer. In addition, the Receiver reserves the right to amend any information which has been made available to prospective purchasers at any time either by the revision of existing material or the addition of new material. Further, the Receiver may, in its sole discretion, elect to not consider any offer, or subsequent offer, that does not fully comply with these terms and conditions. The Receiver may, in its discretion, waive or alter any or all of the conditions in these terms and conditions, any such waiver to be in writing. All conditions contained herein are for the exclusive benefit of the Receiver and may be waived in whole or in part by the Receiver, in its discretion. The Receiver reserves the right to negotiate and to enter into an asset purchase agreement with any party at any time. The highest, or any offer, may not necessarily be accepted. The Receiver's obligation to complete the transaction of purchase and sale contemplated herein shall be relieved if, on or before the closing date, the Purchased Assets or any part thereof have been redeemed or removed from the Receiver's control by any means or process, or if this transaction is restrained by an injunction or other order issued by a court of competent jurisdiction, whereupon the only obligation of the Receiver shall be the return of the Deposit, without interest, set-off or abatement and the Purchaser be deemed to have released the Receiver from any further obligation or liability in connection with said transaction of purchase and sale. 7

112 Vendor The vendor, in respect of the Purchased Assets, will be the Receiver, solely in its capacity as Receiver of Surf Paradise and not in its personal capacity. Due Diligence The particulars describing the Purchased Assets and other information provided by the Receiver relative to this invitation to offer to purchase has been provided solely for the convenience of the prospective purchasers and is not represented or warranted to be complete, nor accurate. Prospective purchasers are expected to carry out their own due diligence before submitting their Offers. As noted above, the Receiver will only sell the Purchased Assets on an "as is where is" basis without any representations or warranties from the Receiver. Closing Date The Closing Date of any sale shall be arranged between the successful purchaser and the Receiver. No Warranty from Receiver By submitting an Offer, each prospective purchaser acknowledges that it has inspected the Purchased Assets, that it has relied entirely upon its own inspection and investigation and that no representations, conditions, or warranties were expressed or implied as to description, measurements, fitness for purpose, or any other matter whatsoever. Sales Commission and Taxes The Receiver shall not be required to pay any sales commission whatsoever in respect of the subject transaction unless a commission agreement is presented, accompanied by an Agreement of Purchase and Sale, the commission agreement is accepted by the Receiver and the accompanying Agreement of Purchase and Sale is accepted by the Receiver and the sale to that prospective purchaser is subsequently closed. 8

113 The purchase price set out in any Offer shall be exclusive of all applicable taxes, charges, liens, duties and other levies imposed by any authority in connection with the sale or use thereof. All such taxes, charges, liens, duties and other levies shall be paid or otherwise satisfied by the Purchaser on or before closing. 6. Viewing of Assets Arrangements can be made to view the Assets by contacting Nathan Wong at ext or 7. List of Additional Appendices II III IV V Inventory Map of Location of the Premises Pictures of the Premises Offer to Purchase 9

114 APPENDIX "II" - Inventory Snowboards and wakeboards Clothing, skateboards, skis and other sporting goods 10

115 APPENDIX "III" - Map of Location of the Premises The subject neighbourhood is bounded as follows: To the North: Highway 60 To the South: Brunei Road The the West: Highway 11 To the East: Fairy Lake Henlres Huritsvilles." Hff v'pwiai'id Oi (w w. ^ Vi-W pofaeffson "omplex in] yvtv' 'i* 60 w ^>1 PflrS; ^, Huntsvilt'e. 11

116 APPENDIX "IV" - Pictures of the Premises Entrance Side 12

117 APPENDIX "V" - Offer to Purchase BDO CANADA LIMITED Receiver of Ontario Inc., Ontario Inc. and Ontario Inc. OFFER TO PURCHASE BDO Canada Limited in its capacity as Court-appointed receiver of Ontario Inc., Ontario Inc. and Ontario Inc. 1 City Centre Drive, Suite 1040 Mississauga, Ontario, L5B 1M2 Attention: Nathan Wong (NAME OF PROSPECTIVE PURCHASER) (ADDRESS OF PROSPECTIVE PURCHASER) (POSTAL CODE) (TELEPHONE NUMBER) (FAX NUMBER) (PERSON TO BE CONTACTED) 1. I/We hereby submit this Offer to purchase the Purchased Assets indicated below for consideration by BDO Canada Limited, Receiver of Ontario Inc., Ontario Inc. and Ontario Inc.: PURCHASE PRICE AMOUNT OF MY/OUR 'EN BLOC OFFER FOR PARCEL I: (exclusive of any taxes, charges, liens, duties, or other levies) $ AMOUNT OF MY/OUR 'EN BLOC OFFER FOR PARCEL II: (exclusive of any taxes, charges, liens, duties, or other levies) $ AMOUNT OF MY/OUR 'EN BLOC OFFER FOR PARCEL III: (exclusive of any taxes, charges, liens, duties, or other levies) $ The prospective purchaser acknowledges receipt of a copy of the Terms and Conditions of Sale. The prospective purchaser acknowledges that this is subject to said terms and conditions of sale that are hereby incorporated herein by reference. 13

118 2. I/We agree that, in the event of this Offer being accepted, to be bound by the attached Terms and Conditions of Sale and that the same forms part of this Offer. 3. This Offer shall be irrevocable until January 14, 2015 when, if not accepted, it shall become null and void. However, the prospective purchaser acknowledges that the Vendor may, in its absolute and uncontrolled discretion and upon notice to the prospective purchaser, extend the period during which this Offer remains irrevocable for up to an additional five (5) days. 4. I/We acknowledge that this Offer is executed by me/us under seal so as to constitute the same as a deed. 5. Enclosed is my/our certified cheque or bank draft payable to BDO Canada Limited, in Trust, in the total amount of CDN$ as a deposit representing at least 10 percent of the total amount of the Offer submitted herein. 6. This Offer is not submitted through any agent and no commission is payable to any party. 7. The prospective purchaser(s) acknowledge(s) that upon acceptance of an Offer by the Receiver, a standard form Asset Purchase Agreement may be required for the Vendor and Purchaser to enter into. 8. Accepted Offers will be subject to Court approval. Dated at this day of, Witness Bidder Per: (Authorized signing officer) 14

119 Tab C

120 edition SUN A MEDIA Ktwa- f- m ait.gr. 11 Dec 2014 i jpi 'y^rn D6 CLASSIFIEDS Watted STEEL eulldings/ METAL BUILDINGS UP TO 60% OFF! 30*40. ACnSCi-SaSO. ecnfiao. eoxioo s<?i Calk for belanc^ l-aicmst-ppoe w«d! -^srr " -FM RECYCLING WE BUY ANY KIND OF METAL! Please find our complete price list on our website or'call IS Kitchener Street, Orillia OPEN: Mon.-fr.o-5. Sat 3-12 Float and Bin Services Available " Local pick up for Vehicles, Farm Equipment and Heavy Machinery Auto Parts & Access)ri»t FentorL okoua y/y/jmammsssnsnimeism (70S) S (800) wtmlentoamitoparts-cihn Top prices paid for your unwanted cars & trucks Free pick tip Fenton Auto Parts servicing OnHis and area since 197$. We are also an environmentally certified auto recycler. ftijlilnqs r# Chri«trna* SaU Dec fah1c^mdf52 Hlh, f2ih.and Cart>, onltn«tofe Brudio dr.gc te-ond, lum ted FOR SALE A rall '.S-EATWEH TIRES) BRAND NEW 2C61'70 R 1S«T. AS THEY ARE NOW CN my 3004 Fwrmcr-mrANA - SELLING FOR PARTS NTERISfTEDP ARTIES ONLY poccestrtml OjBlYM.t 2 BDRN Hou&e in Crllla Gete^. Shed now Was!ief.CifY»r. Mth * HeSt'WrtJra SI 1CO A^iuen l.fer. Nco-«ti«#s Srvtois CANCELVOUB TIMESHARE NO BISK prawj STOP Mortpege & BL PREMIUM Couchiching Area late multiple routes... get s' ~s : bonuses! Area 115 Couchiching Pt. Rd.. Moberley, Broadview 124 Broach'iew Ave.. Weiland, Stanley 129 Mooney Cr. 130 Glen Cr.. Dale Call (X511252) for more info Suites now Avaifable... Fill out your flppllcattetr today! Enjoy s(nior licirq In ttw piduwsque tow ol Btoctiin Oiteria Esoh of cur six. 390 sq. ft siifes olfer open concept livinq bwbs. barrier free viaahiwift, firepiwes. privale tenaces, wntisl air-ocodhionina eatterinterrwrtetpfione, Sforege k-*ers and 2^30 «q. R.of shawd ard ooironcn ar&m, The coiwen^nces Of this in tr«n looatkn are dree at hand and inducte bsnking. post office, drug «.tere. medcsl and dental ollioes. legiin. srooen,', library and LCBO. Bnwhn Independent Living was desicned with wricts in mind olfertrg a unique riving erqpehenos-. V.'- ctt-r our resident iho beol of to'th wild as you ran ertw tfw privecv of now! General labcurer fis-hgpe? ^sneral lttbo«jror>' Hrand ^irpoinlerhefaflr ^! H9p«r nr. reoiinsdlcr buldec, general kcsl contractor. Muef h» bondafciaand ha^ «fls?aierrt tlrrflng racord. For h-rfher inbrmailon Cell Sarn M^kt HELPWANTTDH Up up k to T-I'X'O # AVftk rn8/llnq rnsimnq yourcwn suite orb# p«rt ol our smal bescrtjim fkim Kcrne'l osmmunit/ in ihs ccrmwi areas in a brand Oenulm Oppcfbjnll>1 new seoiie buikdng. Ail ol cur main living No 2ip#rtenc«a araasarecnerw floorforebsyascemibilty; R^qulr^. S^rl. with elected house services Let life reuof>*# lmme<llafem aicund ycu. Call ten your persorwl txjr or mote infoimstion, Erfca Lee Nd?fe TDB.pSfi.lR^.orTOS-FFB-PaCO as, 251 Work 1 day a week - Thursdays Earn $85 (approx $14.00/hr) MUST HAVE RELIABLE VEHICLE Door-to-Docr Delivery In Orillia No Collecting!! Catf 7Ci5-325-t.lSS fx511252) U'Nt-QUE BUSINESS OPPORTUNITY TO ACOUI RE TH E INVENTORY AN0 REAL PROPERTY OFAV/ELL KNOWN SPORTING GOODS RETAILER BDO Canada Umted, In Its capadly as a courl-eppdnted raosiyar, is invillng offers dor flia puiohes# en an "as I, wnsrs is" basis for all of tha property, assets and undertaking cf Ontario Inc., Ontario Ire, end Onto do Inc. (collectively "Surf Paradise"). Surf Paredise, an owner managed sporting goods retailer since 1983, opersled from mumpj# retail localicns in Ortario and was well known dor Its safes of peddles boards, wake boards, snowboard's, apparel and oilier miseellenecus sporting Hems. Surf Paradise owned the free-standing real prcperty It had cperated ftcm In Huntwllfe, Ontario (the "Property j. In addlbcn to the Property, then? is substantial inventory available for an enbloc purchase. The Prcperty and Inventory can be 5<dd separate^ or together m a package. Parties intereeled In this unique opportunity may contact Nathan Weng at 905-E15-878T est 6213 or at mwonn-g bcfo.ca, price to S p.m. December to receive an ihftfrriblico package with respect to the «!««process, including the terms end oondrticos. The highest or any ofler may nsl neces«arify be accepted and BDO may tormirwte the safe process 41 any lime. All criers will be considered cn an individual basis as arw when reoeived. This in/ltatton shculd not be oenstrued as a Sale by Tender, IBDO MTTTMlKl MOVING SALE phone for appointment Dec n/ia'ia feii E3 ^ Q :: Admk^raSve Office nj«* CITY OF ORILLIA JOB OPPORTUNITY pvenue Clerk C-partrrwnt

121 Bala Falls protestor marks 100 days BY BRENT COOPER Peggy Peterson has been called a paid protestor as well as a person of conviction. She has been lauded and laughed at by those who pass by her encampment in Bala.But the Huntsvllle resident is resolute in her position to stop the Bala halls hydroelectric plant Monday marked 100 days Peterson - along with the occasional supporter - has camped out on the properly she claims is designated as part of the plant project by the Ontario government and the project's proponent, Swift Uiver Energy Ltd. "There are four pieces of Crown land and waterfront around the falls that are part of the land lease going to Swift River," she said. These cold wlntery days can find Peterson camped out in a donated mini-van in a parcel of land across the road from the project's proposed location, a small strip of Crown land that she has named Turtle Island In recognition of the migratory Bhmdings turtle species she says walks through the land. She stated that the land she is currently camping on is part of the entire project lands. "it has been amazing. What a life experience this has been, I have a nice warm RV. I am not sleeping here at night anymore. I am a day camper, so I am here ut 8 a.m.," she said. Supporters of the protest commemorated reaching 100 days with a small celebration at the site on Monday afternoon. Peterson, who states that the protest is of her own volition, said she has been in contact about the situation with representatives of the Williams Treaties Rrst Nations, who state it has an outstanding claim against Canada and Ontario concerning the signing of the treaties. The group consists of the Georgina Island First Nation, the Beausoleil First Nation, the Rama First Nation, the Mississaugas' of Alderville First Nation, the Curve Lake First Nation, the Hiawatha First Nation and the Scugog Island First Nation, According to federal government's Aboriginal Affairs and Northern Development Canada website, the Williams Treaties is a series of agreements that designated large parcels of land in southern and central Ontario acquired by the Government of Canada in Swift River Energy Limited, the proponent of the project, idenliffes the parcel of land where the plant is expected to be built as Crown land. Peterson, who is known to many as the / V 'i r). MUSKOKA LORAX: Peggy Pelerson has protested for 100 days at Bala Falls. (Photo by Breni Cooper) Muskoka Lorax, said that she will remain until she hears direction "from whoever can prove they have legal title and stewardship of this island." She said the hardest part of the protest isn't the weather or the long days at the protest site. It is getting the proper Information out to the public about the cause. For now, it appears that Peterson's crusade will go on throughout the winter. Swift River was expected to start work on the site this past October, but it was discovered that the company did not have a lease from the government for the land. Since then, Swift River has received its land ^ rights for the project lands in the form of a land use permit. However, with winter coming soon, the development looks as if it may be on hold for the time being, as there are no dates forthcoming about the progression of the project. But this news doesn't seem to sway Peterson's resolve one way or the other. She believes that somehow and someway, the power plant will never come to pass. "1 am assuming we are going to have it stopped before too long. Things are happening very, very fast at the provincial level," she claimed. "We're not going to give up... I am not leaving." Public Notices Public Nolices Public Notices General Help General Help ] General Help } General Help 2 General Help UNIQUE BUSINESS OPPORTUNITY TO ACQUIRE THE INVENTORY AND REAL PROPERTY OF A WELL KNOWN SPORTING GOODS RETAILER BOO Canada Limited, in its capacity as a court-appointed receiver, is inviting offei-s for the purchase on an "as is, where is" basis for all of the property, assets ami undertaking of Ontario Inc., 1U0594 Ontario Inc. and IHKJHf) Ontario Inc. (collectively "Surf Paradise"). Surf Paradise, an owner managed sporting goods retailer since operated from multiple retail locations in Ontario and was well known for its sales of paddlehoards, wakeboards, snowboards, apparel and other miscelianeotis sportingitems. Surf Paradise owned the free-standing real property (I had operated from in Huutsviilc, Ontario (the "Property"). In addition to the Properly, there is substantial inventory available for an en-bloc purchase.the Properly and inventory can be sold separately or together us a package. Parties interested in tins unique opportunity may contact Nathan Wong at 9054) ext 6213 or at nawongtf&bdo.ca, prior to 5 p.m. December 17, 2014 to receive an infurnmtlon package with respect to die sales process, including the lemis and conditions. The highest or any offer may not necessarily be accepted and BDO may terminule the sale process at any time. All offers will ix- considered on an individual basis as and when received. Tills invilalion should not be construed as a Sale by Tender. IBDO ERRORS AND OMISSIONS If your classified ad appears today for the first time, please check carefully to see that it Is correct in every detail, Notice of an error in your ad must ba given to the classified department in time for the second insertion, We will not be held responsible for more than one incorrect insertion. Thank you, Hoy.-llVulo, iu-iliimal h.mlfii Board of Directors An exciting volunteer leadership opportunity flarrw s Koyal Vtclona RPISUM H<m Hi Cenpii HVH) is» dynanvc tmn/tw.* (typjiu t^-wui ennlrn thai omr.racus divo'ssy und rwudenu throjo'hiui U.ti llurth KurKr.t Mjstf.Va UkjI Mu.tlh Ink-jialcn fiulwuik (LIllNl 'Adh aiirpolmi of ii PUiSo I E>punS.iri RVH tvss doj'j til m wo uktxfatj tno Rt-.'io'iJ C.v^srCemrftand p'ov.'es smites.wj p'ofl'/ir,-, not a.wame e tevaio'e In our reg-on Urn tlivod nl DKeitlinr, trt KVtl menpts r.*v> f/inril iwmfmrs nm,p)hn,il m-i ypor tor njipo rtrr.erl.'rlcrum tn durt- fium vdutli ll u Limi li> hi p lujj Un-1 tuufi ttmhu Into U'J biuhii 'JlUm In O i uffi ut falot lunmis rj lomu'itd wtili t'<[r,-.ord<iw/ po/siah-jfi <jtimhi govumante i-adoishp wit Lv o sejiiiv-.a! and lewiiiinj chiurye You vh ^ ^ Ixijrd on} an orgixwovvfi atc'ltmcdlo'l/ck'nj eartiifo toner Togo'her' t tvo.^jli your ik.ui and viponitrct. )<i. * fm rps.xinta, n loi m.ikig H thn h«m rlmosls nl Ihe hea hi rjirlrp mrpniihson e/niiih inn neji ih ronire i.xn iif, v» sm, mtsiion snd viskm w "MAM I'n nsuer lognihk '» toococuniot- e for the mcnltcmng end ove's^t t of itohe.hh teniie s pertcimonco starijjids and ciher» guide the hee'in cuvie to ocn eva.(6 sirotcgic deectons * ensure 'rjrc.al occujiu^iity, pio-ndinj fiejt.ica sm ys-j.w.e lo 11,3 CEO prbvidu i Lrk W1U1 the U-ami ctnl'v lo unsu'ti u^cbw corrjrrum&ilian ol conimjn ly ptrctrptnxia end tooth reeds RVH has Uunttod a ni.v SUatagiv Pion IWJ'.U J ui A phiavuirtiy wv tai MV CARC. As u Qo.mj of Omlof'* invitiber yoj ait MiOf.jly cotnritied to ihe RVH viswi misskin onl vpl.iss have idmng prrtdial and pmfnminna In'agnly and have»<perprc«w lh. o' arn rnrn'ort/.h n v.uti inn gnvsrnwn - as nppnsa-i in insnajuunint lot. Suftomtf ftxtrfry for niter«.ga on *l<irt notice Is re.tjfed. nlihojjh meetegs v.i I gtrctaiy occxr '.vc afte/toonj. appranmaief/ hvu irr.es per rr.onm as wef as too dayt per year, pus nn-nlalinn hoard meeting preparelnn lur.u Yon inusl bo el leesi IH yean 0' xne not have ihe alalus ot barduujri arxj tusldu 01 Woil In Ihu North Sbncnv K'uskoku UIIN I'SUU map). CstoUatus uiu no! u lgitiu if Ihvy uiu an omp'oyee, a merrttr of tie fyo'essorai Clad, an ktjependenf ronfraeinr ot Ihe CorpotoOin <v a F-amii/ Merrhrr n' a p*r«nn re'ererred To further Uiploiu fu upporu t 1/ y casu 'o.toau youi luiuir.u ct pro'ossiona p.'o-'i*. and COVMIIIJ IOUCI JI c^nlidencu to Hiusla C'.arity al Hoy.i V.rlnna Hftg'dn.v Hen ih Cenlro. (. r.'r-iij'r.t..mm hy J.inu.iry 9, 20IS I'rcvnne npplmn'.s wto wixji In rwapp y kir tl.is povlbn,vr enujuntusd Id revlhrnit Ite r msjina for totisijciaimi Viuii wu ifiank jrxi atkno-ale'lju at sppkalions Ma tmal. ony tiros# opplcarfs wto r/ii! oe rlerviewprl vr.i to rnrj-irtp-l To learn more about Royal Victoria Roglgnal Healtii Centre visit NtukSbewMth LdBukl likptm&ftid cm Nasisrissr Attention Readers THE SNOW IS HERE! Please be advised that on Thursdays our carriers and contractors will be delivering your The Huntsvllle Forester Please be careful when renwvlnb the snow with your snowblower, PoresxeR Thank you and havo a safo winter. Heading South for the Winter? Don't forget to cancel your deliveiy of the TIIF. HUNTS VII. I. K FOKESTER To Cancel Delivery Please Call or mbanett@metrolandnortlimeilia.com, ext 230 ; J

122 Visit the Doctor's Office \\;ilk-ln Clinic Inside Walmart Drop By On Your Lunch Break Or During Office Hours, ^ STO/STI Testing, Blood Pressure/Cholesterol Check, other services! es. 'gl i A Mon & Wed 9am-8pm, Tues & Thurs 9am-4pm?am-4pm Fri 9am-6pm, Sat 10ani-4pm 2065 Fairview St., Burlington 'V i'-j 'I ^ilh TiOTy#;,"'' 1 'hnv :. ii i i>. fnumlation tliat ( ivn tlonnsli upcnmij do Book your tour t.coimecelekateuli V "Cft m &-s> <pce - mtm] s on giving. i in.i I. in.an environment ivlimo iiloas.tlilnkinq anil eiintiilcnce i i m denne equivalent nf a head stmt. at USalle Park ) Wednesday; December 31,2014 d -.. A at the LaSalle Park Pavilion /i 50 North Shore Blvd. East, Burlington (i WW, Featuring the versatile & ) dynamic music of the band N feriiliillscliool.com EVENT MENU 6:00 p.m. Cocktail Hour Upon Arrival Passed Hot Hors D'ocuvres Antipasto Bar 7:00 p.m. Dinner Pint Course Cream of Potato with Bacon & Chive Soup Second Course Spinach &C Ricotta Stuffed Pasta Shells with Rosd Sauce Third Course AAA Prime Rib Au Jus, Yorkshire Pudding, Fingerllng Potatoes & Root Vegetables followed by Chicken Supreme stuffed with Herbed Goats Cheese and Roasted Julienne Red Peppers with Garlic Cream Drizzle Salad Course Field Greens with Honey Vinaigrette Drizzle Dessert Caramel Crunch Tart & Baileys Whipped Cream 11:00 p.m. Pub Inspired Late NightTable Pourine Station, Chicken Wings, Nacho Bar, Sweets & Treats, House Made Pizza, Seasonal Fresh Fruit 8 hour fully indusive bar, unlimited red and white wine throughout dinner and champagne toast to ring in the New Year, party hats ana favours. ttouday TRADITION: Patients at Joseph Brant Hospital who might be bedridden for Christmas received some Christmas cheer this week. The Joseph Brant Hospital Foundation co-ordinated the annual Longo's holiday visit to the hospital yesterday (Thursday). Teresa Longo, along with members of Halton Regional Police and staff from the two Burlington Longo's stores, visited the lakeside medical facility in the morning to deliver gift bags to patients who may not be able to be home with their families over the holiday season. After the dispensing of gifts a reception followed in the hospital lobby where students from Fern Hill School were scheduled to sing carols for visitors, patients and staff. inside today's EDITORIAL SPORTS 28 CLASSIFIED 31 Swing Machines Etc., Dell Computers, Shavcase TV, Holland Park Garden Gallery, Home Hardware, McMastei Unimity - Cwilintfftf Education, Toppers Pizza, Mr. Sub, Local Shopper, Michaels* * not all tyets fete/ are (fefc&aj to asyi Rediscovering community continued from p. 3 make change." In every community there is a role for both agency sendees and community building, he said. "Heres what I see are the differences: Agency services Irave different classes of people we've got the professionals, we've got the clients, we've got the volunteers, In community, we're just all citizens, Agency sendees tend to focus on peoples' needs and that's important but community work focuses on peoples' gifts and that's also important." Agency sendees are totally dependent on money whereas community is totally dependent on relationships and trust, he continued. "Both are critical to a vibrant neighbourhood, but over time weve had more and more services and less and less community" he said, so much so that some experts talk about the breakdown of community life altogether: fewer people vote, fewer eat dinner together and fewer belong to traditional organizations such as bowling leagues or service clubs. Neighbourhoods are often single-purpose land use bedroom communities main streets are being lost and the perception Is often that communities are "scary places to live." "In a sease we have many different communities but in a sense we have no community at all because we don't bump into the same people over and over again. Most distressing, said Diers, Is that die very agencies that are trying to help communities have inadvertently contributed to the breakdown of tire very communities they're trying to help. "We have more and more professionals doing for communities what communities used to do better for themselves Agencies put people into "silos" seniors, disabled, new immigranls, young people and you cant build community in silos, said Diers. "But people are starting to rediscover community every place 1 go" UNIQUE BUSINESS OPPORTUNITY TO ACQUIRE THE INVENTORY AND REAL PROPERTY OF A WELL KNOWN SPORTING GOODS RETAILER BD0 Canada Limited, in its capacity as a court-appointed receiver, is inviting offers for the purchase on an "as is, where is" basis for all of the property, assets and undertaking of Ontario Inc., Ontario Inc, and Ontario Inc. (collectively "Surf Paradise"). Surf Paradise, an owner managed sporting goods retailer since 1983, operated from multiple retail locations in Ontario and was well known for its sales of paddleboards, wakeboards, snowboards, apparel and other miscellaneous sporting items. Surf Paradise owned the free-standing real property it had operated from in Huntsville, Ontario (the "Property"). In addition to the Property, there is substantial inventory available for an enbloc purchase. The Property and inventory can be sold separately or together as a package. Parties interested in this unique opportunity may contact Nathan Wong at ext 6213 or at nawong@bcio.ca, prior to 5 p.m. December 17, 2014 to receive an information package with respect to the sales process, including the terms and conditions. The highest or any offer may not necessarily be accepted and BDO may terminate the sale process at any time. All offers will be considered on an individual basis as and when received. This invitation should not be construed as a Sale by Tender. I BDO

123 rafrgjcseigab 11 Dec CLASSIFIEDS THURSDAY, DECEMBER 11, 2014 THE BARRIE EXAMINER Business ORMrtunMes SECTION C PACE il VfcewaB thumbnails UNIQUE BUSINESS OPPORTUNITY TO ACQUIRE THE INVENTORY AND REAL PROPERTY OF A WELL KNOWN SPORTING GOODS RETAILER BOO Canada Limited, in its capacity as a court-appointed teceiver, is Inviting offers for the purchase on an "as is. where is" basis for ail of the property, assets and undertaking of Ontario Inc Ontario Inc. and Ontario Inc. (collectively "Surf Paradise"). Surf Paradise, an owner managed sporting goods retaiier since 1983, operated from multiple retail locations in Ontario and was well known for Its sales of paddles boards, wake boards, snowboard's, apparel and other miscellaneous sporting items. Surf Paradise owned the free-standing teal property It had operated from In Huntsville, Ontario (the ""Property"). In addition to the Property, there is substantial inventory avail table for an enbloc purchase. The Property and Inventory can be add separately or together as o package. Parties Interested in this unique opportunity maty contact Nathan Wong at est or at nawnnofetado ca prior to 5 p.m. December to receive an Information package with respect to the sales process, including the terms and conditions, The highest or any offer may not neoessarily be accepted and SDO may terminate the safe process at any time. All offers will be considered on an individual basis as and when received. This invitation should not be construed as a Sale by Tender, IBPO NOTICE TO CREDITORS AHD OTHERS In the Estate of Ingrid Blocksdorf, deceased. All claims against the estate of Ingrid Blocksdorf, late of the City of Barrie In the County of Simcoe, who died on or about the 4th day of July, 2014, must be filed with the undersigned Estate Trustee on or before the 13th day of February, 2015; thereafter, the undersigned will distribute the assets of the said estate having regard only to the claims then filed. DATED at Wasaga Beach this 4th day of December, 2014, Thomas Blocksdorf, Estate Trustee, by his Solicitors, H6R GRAHAM PARTNERS LLP, 940 Mosley Street, Unit# 1, Wasaga Beach, Ontario, L9Z 2G9. Attn: Lysanne f, Choiette o jour moments.ca milestones.sun a yourlifemoments.ca Marking your milestones. Obituaries i In Memoriam! Thanks 1 Births i Celebrations i More InHemoiiams tomcniflriams inmemoriaas Deatti Notices Li jeaih * - ' 4 1 QbHH ua 1 XL a o o yi fedl iki!!ii M'X -i&h&rhl S&,iip. w- 35(11) of 48 -Click and Drag mous<& to mov# tho l@ns / Doublo click to closo tho j-oom Ions N^wspaporDiroct Inc. db» Pr«ssR*a<

124 Tab D

125 AIRD & BERLIS LLP Barristers and Solicitors Steven L, Graff Direct: March 16,2015 VIA and BDO Canada Limited 1 City Centre Drive Suite 1040 Mississauga, ON L5B 1M2 Attention; Peter Naumis and Vince Siciliano Dear Sirs/Mesdames: Re: Receivership of Ontario Inc., Ontario Inc. and Ontario Inc. BDO Canada Limited, in its capacity as the court-appointed receiver (in such capacity, the "Receiver") of all of the assets, undertakings and properties of Ontario Inc. ("113"), Ontario Inc. ("116"), and Ontario Inc. ("231", together with 113 and 116, collectively, hereinafter the "Debtors"), has requested our opinion concerning the perfection of the security documents herein discussed granted to Royal Bank of Canada ("RBC") by each of the Debtors. We confirm that we have received and reviewed the security documents granted by each of the Debtors in favour of RBC described herein, and hereby provide you with our opinion concerning the perfection of same. A. DOCUMENTS EXAMINED AND SEARCHES CONDUCTED In connection with the opinions contained in this letter, we have examined a copy of: 1, the General Security Agreement dated August 16, 2001, granted by 113 to RBC (113's August GSA"); 2, the General Security Agreement dated September 4, 2001, granted by 113 to RBC ("113's September GSA"); 3, the General Security Agreement dated March 31, 2006, granted by 116 (the "116 GSA"); 4, the General Security Agreement dated December 3, 2013, granted by 231 (the "231 GSA"); 5, Collateral Mortgage in the amount of $200,000 from 116 over 6 King William Street, Huntsville, Ontario and as legally described in the Land Registry Office for the Land Title Division of Muskoka (Bracebridge) (No. 35) under PIN No, (the "Premises") registered on March 31, 2006 (the "First Charge"); and Brookfield Place, 181 Bay SUeet, Suite 1800, Box 754 Toronto, ON. M5J 2T9 Canada T F dbpitu.c'mi]

126 -2-6, Additional Collateral Mortgage in the amount of $500,000 from 116 over the Premises registered on June 12, 2014 (the "Second Charge", and together with the First Charge, collectively hereinafter the "Charges"), (each of lid's August GSA, lid's September GSA, the 116 GSA, and the 2dl GSA are collectively, hereinafter referred to as the "General Security Agreements", and together with the Charges, collectively hereinafter referred to as the "Security"), In addition, in connection with the opinions contained in this letter, we have conducted the following searches: 1, certified searches from the Ontario Personal Property Registration System against each of the Debtors with file currency of March 8, 2015 (the "PPSA Search"); and 2, a review of the parcel pages for PIN (LT) with a file currency of March 10, We have conducted no further searches in connection with the delivery of this opinion, B. OPINIONS General Security Agreements 1, 113's August GSA We have reviewed 113's August GSA and note that it appears to be properly executed and delivered on behalf of 113 by an authorized signing officer, We see no irregularity in 113's August GSA and expect that it is enforceable in accordance with its terms, Registration under the Personal Property Security Act (Ontario) (the "PPSA") in respect of 113's August GSA was made on August 29, 2001, under Reference File No and Registration No, , This registration covers "Inventory", "Equipment", "Accounts", "Other" and "Motor Vehicle" and includes the general collateral description "General Security Agreement", This registration appears to be in good order with an expiry date of August 29j 2016, We, therefore, conclude that, subject to the assumptions and qualifications contained herein, 113's August GSA represents a valid and perfected security interest in the assets and undertaking of 113 described therein, being all of 113's inventory, equipment, accounts and book debts, business records, contractual rights, insurance claims and intellectual property and such other property which may be described in Schedule "C" or any other schedule now or hereafter attached to 113's August GSA 's September GSA We have reviewed 113's September GSA and note that it appears to be properly executed and delivered on behalf of 113 by George Morrison, in his capacity as President, We see no irregularity in 113's September GSA and expect that it is enforceable in accordance with its terms, AIRD & BERLIS UP Barristers and Solicitors

127 According to the PPSA search with respect to 113, no separate registration was made under the PPSA in respect of 113's September GSA. However, as a PPSA registration can be used to secure more than one security interest, RBC may rely on the registration made in connection with 113's August GSA reviewed above, We, therefore, conclude that, subject to the assumptions and qualifications contained herein, 113's September GSA represents a valid and perfected security interest in the assets and undertaking of 113 described therein, being all of HS's inventory, equipment, accounts and book debts, business records, contractual rights, insurance claims and intellectual property and any of the other property which may be described in Schedule "C" or any other schedule now or hereafter attached to 113's September GSA, We note that Schedule "C" to 113's September GSA includes property located at the following locations: (a) 4380 South Service Road, Burlington, Ontario L7L 5Y6; (b) 1855 Dundas Street East, Mississauga, Ontario L4X 1M1; (c) 700 Guelph Line South, Burlington, Ontario L7R 3M8; (d) 208 Manitoba Street, Bracebridge, Ontario P1L 1S1; (e) 411 Bayfield Street, Unit B13, Barrie, Ontario L4M 6E5; (f) 106 King Street West, Kitchener, ON N2G 1A6; (g) 161 Davis Drive, Units 3 & 4, Newmarket, Ontario L3Y 2N3; and (h) Yonge Street, Newmarket, Ontario L3 Y 7R9, 3, 116 GSA We have reviewed the 116 GSA and note that it appears to be properly executed and delivered on behalf of 116 by each of George Morrison, in his capacity as President, and by Steve Walsh, in his capacity as Secretary, We see no irregularity in the 116 GSA and expect that it is enforceable in accordance with its terms, Registration under the PPSA in respect of the 116 GSA was made on March 20, 2006, under Reference File No, and Registration No, , This registration covers "Inventory", "Equipment", "Accounts", "Other" and "Motor Vehicle", This registration appears to be in good order with an expiry date of March 20, 2016, We, therefore, conclude that, subject to the assumptions and qualifications contained herein, the 116 GSA represents a valid and perfected security interest in the assets and undertaking of 116 described therein, being all of 116's inventory, equipment, accounts and book debts, business records, contractual rights, insurance claims and intellectual property and other property which may be described in Schedule "C" or any other schedule now or hereafter attached to the 116 GSA, 4, 231 GSA We have reviewed the 231 GSA and note that it appears to be properly executed and delivered on behalf of 231 by an authorized signing officer, We see no irregularity in the 231 GSA and, subject to the assumptions and qualifications contained herein, expect that it is enforceable in accordance with its terms. Registration under the PPSA in respect of the 231 GSA was made on March 21, 2014, under Reference File No, and Registration No, , This AIRD & BERLIS LLP Barristers and Solicitors

128 .4 - registration covers "Inventory", "Equipment", "Accounts", "Other" and "Motor Vehicle". This registration appears to be in good order with an expiry date of March 21, 2019, We, therefore, conclude that, subject to the assumptions and qualifications contained herein, the 231 GSA represents a valid and perfected security interest in the assets and undertaking of 231 described therein, being all of 23rs inventory, equipment, accounts and book debts, business records, contractual rights, insurance claims and intellectual property and other property which may be described in Schedule "C" or any other schedule now or hereafter attached to the 231 GSA. Charges 1. First Charge We have reviewed the First Charge in respect of the Premises, granted by 116, and registered on March 31, 2006, as Instrument No. MT The First Charge secures all liabilities and obligations of 116 to RBC up to the principal amount of $200,000 and is subject to Standard Charge Terms We see no irregularity in the First Charge and expect that it is enforceable in accordance with its terms, 2, Second Charge We have also reviewed the Second Charge in respect of the Premises, granted by 116, and registered on June 12, 2014, as Instrument No, MT139698, The Second Charge secures all liabilities and obligations of each of the Debtors to RBC up to the principal amount of $500,000 and is subject to Standard Charge Terms We see no irregularity in the Second Charge and expect that it is enforceable in accordance with its terms. As is normally the case for mortgaged security, we have not performed a full title search, As noted above, we have, however, sub-searched title to the Premises and reviewed the registered documents shown on the parcel register for the Premises. 116 remains the registered owner of the Premises, Based exclusively upon our review of the aforementioned searches and documents, and subject to the assumptions and qualifications contained herein, we confirm that 116 appears to hold good and valid title to the Premises and that RBC holds good and valid first and second charges, in the amounts of $200,000 and $500,000, respectively, subject to any prior registrations, Conclusions: Based on and limited by the foregoing, and subject to the assumptions and qualifications herein contained, we are of the opinion that: 1, the security interests created by the respective General Security Agreements in the collateral described therein have been properly perfected under the PPSA (to the extent required) and would rank in priority to the interest of a trustee in bankruptcy in the assets, properties and undertakings of the respective Debtors which are described in the respective General Security Agreements and are located in the Province of Ontario, or, in the case of accounts, where the party obligated to pay an account is a resident of the Province of Ontario; and AIRD & BERLIS LLP Berrlstora and Sollcllora

129 2, the Charges have been registered against title to the Premises and constitute valid and enforceable Charges in favour of RBC, C, OTHER PPSA REGISTRATIONS We note that there are registrations made by other companies against certain of the Debtors. In particular, each of:» Business Development Bank of Canada has made registrations against each of 113 and 116;and K2 Corporation of Canada has made a registration against 231 and against "Surf Paradise" which is a registered business name of 113, Details of those registrations are attached hereto at Schedule "A". We have not reviewed the security documents with respect to these registrations and express no opinion with respect these registrations, D, OTHER REGISTRATIONS ON TITLE The only other registration on title to the Premises is the Court Order Application, which was filed in favour of the Receiver, E, ASSUMPTIONS In connection with the opinions contained in this letter, we have assumed the following: 1, The entering into, execution and delivery of the Security to RBC has been duly authorized by all necessary resolutions and other corporate actions on the part of each of the Debtors, 2, The Security has been executed and delivered to RBC by a director and/or officer of each of the Debtors duly authorized to execute and deliver those documents, and the signatures on the copies of the Security examined by us is that of the duly authorized director and/or officer of each of the Debtors, 3, The Security constitutes valid and enforceable obligations of each of the Debtors to RBC as security for each of the Debtors' obligations to RBC, subject to the requirements of the Personal Property Security Act (Ontario) (the "PPSA"), the Banlcruptcy and Insolvency Act (Canada) (the "BIA"), the Mortgages Act (Ontario) and the Planning Act (Ontario), 4, The Security has been unconditionally delivered by each of the Debtors to RBC. 5, The Security has not been assigned, released, discharged or otherwise impaired, either in whole or in part, AIRD & BERLIS LLP Berrlslcrs flnd Solicitors

130 6, The financing statements filed under the PPSA in respect of the Security, if any, were completed in compliance with the regulations under the PPSA and copies thereof were delivered to each of the Debtors in accordance with the provisions of the PPSA, 7, Each of the Debtors is indebted to RBC and received adequate consideration for the grant of the Security, 8, The genuineness of the signatures and the conformity to authentic original documents of the documents submitted to us as photocopies, electronic copies or fax copies, and that all documents were fully completed prior to signature. 9, " Ontario Inc.", " Ontario Inc." and " Ontario Inc.", were the proper legal names of each of the Debtors, respectively, at the time of execution and delivery of the Security, and that these names have not subsequently been changed. 10, Each of the Debtors was a valid and subsisting corporation at the time of execution and delivery of the Security, 11, Copies of the PPSA Searches examined by us in connection with the opinions given herein was complete and accurate when examined and continues to reflect registrations against each of the Debtors, as of the date hereof, 12, Each of the Debtors and RBC intended the security interests created by the Security to attach, value has been given and each of the Debtors obtained rights in the collateral secured by the Security, 13, All facts set forth in official public records and other documents supplied by public officials or otherwise conveyed to us by public officials are complete, true and accurate, F. QUALIFICATIONS The opinions that we have expressed in this letter are further subject to the following qualifications: 1, We express no opinion as to the right, title or interest of any of the Debtors in or to any of their respective assets, undertakings and properties, including without limitation, in the case of 116, its right, title or interest, if any, in the Premises, 2, We express no opinion on whether any secured party may have a perfected purchase money security interest which may exist in respect of any of the assets, undertakings and properties of the Debtors, 3, We express no opinion as to whether a security interest was created in the following property: (a) property consisting of a receivable, license, approval, privilege, franchise, permit, lease or agreement to the extent that the terms of such property or any applicable law prohibit its assignment or require, as a condition of its assignability, a AIRD & BERLIS UP Barristers and Solicitors

131 -7- consent, approval or other authorization or registration which has not been made or given; (b) (c) (d) permits, quotas or licenses which are held by or issued to the Debtors; federal crown debts; and any real property or interest therein. 4, We have made no searches under applicable statutes, including the Copyright Act (Canada), the Patent Act (Canada) and the Trade-marks Act (Canada), to confirm that RBC has made registrations that may be necessary to perfect its security interests, if any, in intellectual property, 5, We express no opinion as to the ranking or priority of any of the Security in relation to the security interests, liens (including construction liens and any holdbacks required to be maintained pursuant to the Construction Lien Act (Ontario)) or trust claims of any other party, if any, 6, The validity, binding effect and enforceability of the Security may be limited by applicable bankruptcy, insolvency, reorganization, arrangement, winding-up, moratorium, or other similar laws affecting the enforceability of creditors' rights generally, 7, The rights and remedies of RBC contained in the Security may be subject to and affected by general principles of equity, 8, No opinion is expressed as to the enforceability of any provision in the Security which suggests that modifications, amendments or waivers of or with respect to any of the Security that are not in writing will not be effective. 9, No opinion is given regarding any provision in the Security which purports to relieve a person from a liability or duty otherwise owed or to require compliance regardless of law, 10, We express no opinion as to the effect of those provisions of the Security which purport to allow the severance of invalid, illegal or unenforceable provisions or restricting their effect, 11, Enforcement of the Security may be affected or limited by any collateral agreements or arrangements relating thereto entered into between the parties thereto, of which we are not aware. 12, Enforcement of the rights to indemnity, contribution and waiver of contribution may be limited or voided by applicable law and may not be ordered by a court on grounds of public policy. 13, The enforceability of the Security is subject to the Limitations Act, 2002 (Ontario), and we express no opinion as to whether a court may find that any provision of the Security AIRD & BERLIS LIP Barristors and Solicitors

132 -8- will be unenforceable as an attempt to vary or exclude a limitation period under that statute, 14, We express no opinion as to the enforceability of any provision of the Security which may be characterized by a court as an unenforceable penalty and not as a genuine preestimate of damages, 15, We express no opinion as to the application of the Securities Act (Ontario), 16, We express no opinion as to the enforceability of any provision of the Security: (a) (b) (c) which purports to waive all defences which might be available to, or constitute a discharge of the liability of the Debtors and or any party thereto; to the extent it purports to exculpate, or provide indemnity to, RBC, its agents or any receiver, manager or receiver - manager appointed by it from liability in respect of acts or omissions which may be illegal, fraudulent or involve wilful misconduct; or which states that amendments or waivers of or with respect to the Security that are not in writing will not be effective, 17, We express no opinion as to any provision of the Security which states that any failure to exercise, or any delay in exercising, any right or remedy shall not operate as a waiver thereof, 18, We have not explored and express no opinion as to whether the Security may be successfully attacked as a preference under section 95 of the BIA or any similar provincial legislation, 19, A waiver of a provision of applicable law may not be effective, 20, Any provision which is considered to offend public policy or to contravene laws of public order may not be enforceable, 21, To the extent that the Security purports to extend the benefit thereof to persons who are not parties to the Security, those persons may be unable to enforce that benefit, 22, No opinion is given as to security interests which are not registered on title to the Premises, 23, The enforceability of the Charges may be subject to the terms of any instruments or encumbrances registered on title to the Premises in priority to the Charges or any instruments or encumbrances to which RBC has agreed to postpone registered on title to the Premises subsequent to the Charges. 24, We have not conducted any title or off-title searches in connection with the Premises other than a review of the parcel pages, Without limiting the generality of the foregoing, AIRD & BERLIS LLP Barristers and Sollcltofs

133 we have not conducted any searches for compliance of the Charges or 116's title to the Premises with the terms of the Planning Act (Ontario), The opinions that we have expressed in this letter are limited to the laws of the Province of Ontario and the federal laws of Canada applicable in Ontario, We trust that the foregoing opinions are satisfactory for your purposes, If you should have any questions or require further clarification in any respect, please do not hesitate to contact us, Yours very truly, AIRD & BERLIS LLP AIRD & BERLIS LLP Barristers and Solicitors

134 - 10- SCHEDULE"A" PPSA SEARCH SUMMARY Enquiries and searches were made against Ontario Inc., Ontario Inc. and Ontario Inc. at the registration system maintained pursuant to the PPSA. The currency of each of the PPSA searches is March 8, 2015, Such enquiries and searches failed to disclose any undischarged registrations, filings or recordings with respect to the aforementioned names except as follows: Legend: A - CF - CG - Accounts Caution Filing Consumer Goods DOM- E - Date of Maturity Equipment GCD - General Collateral Description: I - MV - NFMD - Inventory Motor Vehicle No Fixed Maturity Date O - Other RSLA Repair & Storage Lien Act $ - Amount Registration Number 1, Renewed for 5 years by Renewed for 5 years by Amended collateral classification to include MV by , Amended and add additional address for Debtor by File Number Ontario Inc. Expiry Date August 29, January 18, 2030 Debtor Secured Party Collatei <il C lassilieatiou'de seription Ontario Inc Ontario Inc. Royal Bank of Canada Business Development Bank of Canada I, E, A, O, MV GCD: General Security Agreement I, E, A, O GCD: see below General Collateral Description: General Security Agreement - all present and after acquired personal property AIRD & BERLIS LLP Barrlstora and Solicitors

135 -11 - Registration Number File Number Ontario Inc. Fxpiry Date Debtor Secured Party Collator, il Classification/De j sciiption I, E, O GCD; see below 3, ' Amended the debtor of record from Ontario Inc. by May 27, Ontario Inc. Surf Paradise K2 Corporation of Canada General Collateral Description: Whereas it is contemplated that the Debtor may purchase units, parts, accessories, supplies and related goods under the brand name or names from the Secured Party from time to time subject to the terms and conditions hereinafter set out. Whereas the term merchandise as provided for in the purchase money security interest agreement shall refer to K2 skis, snowboards, boots, bindings, apparel, inline skates and accessories, madshus cross country skis, ride snowboards, boots, bindings, apparel and accessories, 5150 & morrow snowboards, boots, bindings and accessories, planet earth apparel, adio shoes, marker bindings, volki skis, snowboards, bindings, apparel and accessories, dalbello skisboots, line skis, zoot, atlas & tubbs snowshoes, little bear, karhu. And any and all other brand goods which may be sold to the Debtor and whereas the security provided by the purchase money security interest agreement shall exist only at such time or times when the merchandise shipped to the debtor has not been fully paid for. Registration Number Amended the debtor of record from Ontario Inc. by File Number Ontario Inc. Fxpiry Date May 27, 2020 Debtor Ontario Inc. Surf Paradise Secured Party K2 Corporation of Canada Collateral Classification/De seription I, E, O GCD; see below General Collateral Description; Whereas it is contemp ated that the Debtor may purchase units, parts, accessories, supplies and related goods under the brand name or names from the Secured Party from time to time subject to the terms and conditions hereinafter set out. Whereas the term merchandise as provided for in the purchase money security interest agreement shall refer to K2 skis, snowboards, boots, bindings, apparel, inline skates and accessories, madshus cross country skis, ride snowboards, boots, bindings, apparel and accessories, 5150 & morrow snowboards, boots, bindings and accessories, planet earth apparel, adio shoes, marker bindings, volki skis, snowboards, bindings, apparel and accessories, dalbello skisboots, line skis, zoot, atlas & tubbs snowshoes, little bear, karhu. And any and all other brand goods which may be sold to the Debtor and whereas the security provided by the purchase money security interest agreement shall exist only at such time or times when the merchandise shipped to the debtor has not been fully paid for. 2, March 21, Ontario Inc. Royal Bank of Canada I, E, A, O, MY 1 Reference File No, has been included in this summary because the registration was originally made against Ontario Inc. and Surf Paradise. When the amendment was filed to record the debtor change from Ontario Inc. to Ontario Inc. the amendment included "Surf Paradise" as a 2" d debtor. Surf Paradise is a registered business name owned by Ontario Inc. AIRD & BERLIS UP BDrrlators and Sollcllprs