Insider Trading and Black-Out Periods

Policy

Procedure

1. It is an offence for any person in a “special relationship” with the Company to trade securities of the Company while in possession of material non-public information that, if made public, could reasonably be expected to cause a significant change in the price of the Company’s stock. Persons in a “special relationship” with the Company include all directors, officers and employees of the Company plus all parties (“tippees”) who learn of material information from any director, officer or employee of the Company (“tippers”) where the tippee knows or reasonably ought to have known that the tipper was in a special relationship with the Company. Directors, officers and employees are also deemed to be in a special relationship with another company (and are correspondingly prohibited from trading in the securities of said other company) if they become aware of undisclosed material information concerning the other company as a result of their employment with the Company.
2. In the event a director, officer or employee proposes to make a trade that may be prohibited under this Policy, he or she should obtain from the CEO or the CFO a determination as to whether or not the undisclosed information that he or she possesses is material or whether a trade may be made. If any ambiguity exists as to whether or not a director, officer or employee should be permitted to make a trade, the matter should be discussed with the Company’s securities counsel.
3. Certain circumstances will give rise to periods of time (“Black-out Periods”) during which no trading of securities is to take place at all by directors, officers and employees who are routinely (or in the special circumstances at hand) in possession of undisclosed material information (“Restricted Persons”). Currently the Black-Out-Period related to the release of quarterly and annual financial statements, for directors, officers and those persons directly involved in the preparation of financial statements and related documents, are as follows:
   
   
   • For the first quarter ending June 30 – from June 30 to August 15*,
   • For the second quarter ending September 30 – from September 30 to November 15*,
   • For the third quarter ending December 31 – from December 31 to February 15*,
   • For the forth quarter ending March 31 – from March 31 to June 15*,
   *Black-out Periods, relating to the release of the quarterly and annual financial information, end on the first business day following release of quarterly and annual results and the trading by the restricted persons may start on the following day.
4. A Black-out Period shall also be declared by the CFO pending the announcement of any material undisclosed development effecting the Company or following the crystallization of a material transaction involving the Company. Black-out Periods shall remain in effect until and including the first business day following release of the material information concerned. In declaring a Black-out Period, the CFO will stipulate who is subject to the Black-out Period, and the CFO may determine whether any particular reason is to be given for the imposition of a Black-out Period.
5. Persons involved in the negotiation of material transactions will be held to a higher standard than other Restricted Persons as a result of their more intimate knowledge of a particular transaction. Accordingly, such persons should cease trading in the Company’s securities when any material transaction comes under serious negotiation rather than upon the imposition of a Black-out Period. If any ambiguity exists as to whether or when a transaction has come under “serious negotiation”, the matter should be discussed with the Company’s securities counsel.
6. Persons (regardless of place of residence), upon becoming insiders of the Company, must file with the applicable Canadian regulators an initial report and must subsequently report all trades made in the securities of the Company within 10 days after the trade is made.
7. Breaches of this Policy may constitute violation of securities laws and can cause acute embarrassment to the Company. If the Company discovers that a director, officer or employee has violated applicable securities laws, it will refer the matter to the appropriate regulatory authorities. Disciplinary action may be brought against a party who violates this Policy, which could result in termination of employment with the Company.