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MEMBER REGULATION INVESTMENT DEALERS ASSOCIATION OF CANADA notice ASSOCIATION CANADIENNE DES COURTIERS EN VALEURS MOBILIÈRES Contact: K. Rose: (416) 943-6907 - krose@ida.ca MR 009 February 15, 2000 ATTENTION: Ultimate Designated Persons Chief Financial Officers Panel Auditors Distribute internally to: Corporate Finance Credit Institutional Internal Audit Legal & Compliance Operations Registration Regulatory Accounting Research Retail Senior Management Trading desk Training QUÉBEC PUBLIC CURATOR ACT Enclosed find a copy of a News Release from the Public Curator of Québec describing Legislative Amendments to the Public Curator Act. Also enclosed is a copy of a letter received from the Director, Provisional Administration of Unclaimed Property clarifying the status of unclaimed dividends and interest resulting from Interinstitutional Financial Clearing. Discussions are still being held with the Public Curator of Québec to resolve a number of outstanding issues. TORONTO Suite 1600, 121 King Street West, Toronto, Ontario M5H 3T9 Telephone: (416) 364-6133 Fax: (416) 364-0753 CALGARY Suite 2300, 355 Fourth Avenue S.W., Calgary, Alberta T2P 0J1 Telephone: (403) 262-6393 Fax: (403) 265-4603 HALIFAX Suite 1620, TD Centre, 1791 Barrington Street, Halifax, Nova Scotia B3J 3K9 Telephone: (902) 423-8800 Fax: (902) 423-0629 MONTRÉAL Suite 2802, 1 Place Ville Marie, Montréal, Québec, H3B 4R4 Téléphone: (514) 878-2854 Télécopieur: (514) 878-3860 VANCOUVER Suite 1325, P.O. Box 11614, 650 West Georgia Street, Vancouver, B.C. V6B 4N9 Telephone: (604) 683-6222 Fax: (604) 683-3491

NEWS RELEASE Montreal, January 6, 2000 Attention: Securities advisers or dealers LEGISLATIVE AMENDMENTS TO THE PUBLIC CURATOR ACT NEW MEASURES ON UNCLAIMED FINANCIAL PRODUCTS HELD BY SECURITIES ADVISERS OR DEALERS IN THE NAME OF OR ON BEHALF OF OTHERS Highlights of the Amendments Bill 163 (1997, chapter 80), an Act to amend the Public Curator Act and other legislative provisions relating to property under the provisional administration of the Public Curator (the Act), was assented to in December 1997, made significant legislative changes, particularly in the provisions of section 24 of the Public Curator Act respecting the provisional administration of unclaimed property by the Public Curator. Section 24.1 was inserted after section 24 to give a more extensive definition of the category of unclaimed financial products. With the July 1, 1999 coming into force of these amendments to the Public Curator Act and other legislation, this agency becomes the single service point for unclaimed property in Québec. The main purpose of these amendments is to promote the recovery and management by the Public Curator of property not claimed by its owners or other interested parties whose last known domicile was in Québec and to facilitate the exercise of their right to claim their property or its value from the Public Curator. More specifically, the Act defines what property can be considered unclaimed and sets out clearly for each type of property when the property can be considered unclaimed. It also defines the obligations of those in possession of this property with respect to its transfer to the Public Curator of Québec. Moreover, the Act confers expanded powers of inspection on the Public Curator and its representatives and redefines how this property is managed by the Public Curator so as to speed up its liquidation and the transfer of any balance to the Minister of Finance.

2 Procedure for transfers to the Public Curator The debtor or holder of unclaimed property as described above must give at least three months written notice to the interested party within the six months preceding its transfer to the Public Curator. Such notice is not required if the interested party s address cannot be found by reasonable means or if the value of all the property not claimed by the interested party is less than $100. Unclaimed property is transferred to the Public Curator once a year. For securities dealers and advisers, the transfer of unclaimed property not registered under the Income Tax Act (Canada) must follow the following instructions: cash and a statement of the account on the date of the transfer, indicating the securities recorded in the account and their prices, are sent by registered mail to the Public Curator; unclaimed securities recorded in the client s account are kept by the securities dealer or representative for the Public Curator, who acts in its capacity as interested party ; the accounts containing unclaimed property are renamed as Public Curator of Québec in its capacity to (client s name) ; the subsequent liquidation of these unclaimed securities will occur further to instructions conveyed by the Public Curator. Before making the transfer, the debtor or holder must contact the Public Curator to obtain instructions on what information to provide and the procedures to follow for the transfer of unclaimed property registered under the Income Tax Act (Canada) since it is subject to a direct transfer to a trustee designated by the Public Curator At the time the property is transferred to the Public Curator, the debtor or holder must submit a statement (register) containing a description of the unclaimed property and required information on the interested party (a specimen statement is available on request). When to make the transfer to the Public Curator? General Rule: The Regulation implementing the Act provides that the debtor or holder of unclaimed property must annually transfer the property and submit the related documentation to the Public Curator in the first quarter after the end of the year in which this property becomes unclaimed or, if the debtor or holder operates a business or is a company, within the first quarter after the fiscal year in which the property becomes unclaimed. However, according to the application of the regulations of the Public Curator, the

3 fiscal year for unrestricted practice dealers and group savings dealers, in the meaning of the Québec Securities Act (R.S.Q., c. V-1.1) is deemed to end on February 28 and July 31, respectively, of each year. Transitional Rule: For property becoming unclaimed before July 1, 1999: The adviser or dealer has one year, starting July 1, 1999, to give to the interested party the notice provided in section 26 of the Act. Consequently, the transfer of such property to the Public Curator must be made at the latest by January 1, 2001. For property becoming unclaimed between July 1, 1999 and the end of this fiscal year: The obligation of a group savings dealer or broker whose fiscal year is deemed to end on July 31, 1999 is postponed by 6 months, to April 30, 2000 at the latest; for unrestricted practice dealers whose deemed fiscal year-end is determined by the general rule on February 28, 2000, the transfer must be made during the quarter ending on May 31, 2000. For subsequent fiscal years, the general rule applies. For additional information: Provisional Administration of Unclaimed Property Division Unclaimed Financial Products Department Public Curator of Québec Tel. (514) 873-4074 Toll-free: 1 800 363-9020 Fax: (514) 864-2440

Le Curateur public du Québec Montreal, December 20, 1999 Ms. Fernande Lanoix Regional Director Investment Dealers Association of Canada 1 Place Ville Marie, Suite 2802 Montreal (Quebec) H3B 4R4 Re: Interinstitutional financial clearing Madam, In the course of implementing the legislative changes made to the Public Curator Act by Bill 163 regarding financial products that have become unclaimed property, we have engaged in meetings and/or telephone conversations with you and other representatives of the securities industry on this matter. We understand the following from the explanations you provided on inter-institutional clearing in the securities industry: 1. that on a dividend (or interest) declaration date, the investment dealers receive payment of dividends and/or interest from the transfer agents for their clients registered as holders as of the registration date; 2. that it may happen that transactions occur between that date and the payment date or that the registration by the transfer agent is inadequate; 3. that it is possible that different amounts are received by financial institutions in relation to the positions held by each client entitled to dividends or interest; 4. that the practice among brokers and other financial institutions is to credit the clients, regardless of whether or not the money owed has been received; 5. that it is the responsibility of the brokerage firm or the other financial institution involved to reconcile the amounts received and the monies paid and to do the necessary searches to balance these amounts; 6. that a financial institution that ends up with a surplus cannot identify to which financial institution it owes the surpluses, since all of its clients have been credited for the amounts owed; /2 600 Boulevard René-Lévesque Ouest, Suite 500, Montréal (Québec) H3B 4W9 Telephone: (514) 873-4074 Toll-free: 1-800-363-9020 Fax: (514) 873-4972

2 Ms. Fernande Lanoix December 20, 1999 Given that the provisions of the Public Curator Act covers the amounts unclaimed by the customer from the financial institution, while inter-institutional financial clearing concerns brokers and financial institutions with respect to the securities market and the Canadian Depository for Securities Limited, we would be of the opinion that monies unclaimed in the inter-institutional financial clearing process are not covered by the Public Curator Act. Nonetheless, to ensure that these unclaimed monies actually belong to the institutions and not to their clients, we will appropriately analyze these unclaimed monies during our inspections, if applicable. Yours truly, Robert Garneau Director, Provisional Administration of Unclaimed Property GLJ: mr c.c.: Mr. Yvan Naud Compensation BNC Inc.