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August 2009
Company Valuation and Equity Term Sheet Workshop offered Sept. 21

The Investment Capital Branch is pleased to support the Company Valuation and Equity Term Sheets workshop to be offered in Vancouver on Sept. 21, 2009.

Bill Payne, founder of the U.S. Angel Capital Association, leads the workshop supported by a panel of experts including Dan Rosen of the Seattle Alliance of Angels, author and angel investor Basil Peters, Mike Volker of the Western Universities Technology Innovation Fund, and Steve Lukas, of Fasken Martineau Dumoulin LLP.

For further information please visit www.angelforum.org.

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April 2009
25th Angel Forum set for May 26

The Investment Capital Branch is pleased to support the 25^th Angel Forum in Vancouver onMay 26, 2009.

The Angel Forum has been a successful venue for bringing together pre-screened investors and companies since 1997.

The registration deadline for this year'sAngel Forum is May 9.

For further information please visit the forum's website at www.angelforum.org.

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March 2009
B.C. posts improved venture capital results in 2008

Despite the turbulent economic climate, British Columbia increased its share of venture capital invested in Canada to 19 per cent compared to the other provinces and territories.

A total of $259 million was invested in 51 companies in B.C. in 2008.

The Investment Capital Branch's Venture Capital Programs facilitated about 24 per cent of these investments.

For more information, and the full 2008 Venture Capital report, visit the Thomson Financial website www.canadavc.com and click on 'VC Resources' and then 'Stats.'

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March 2009
2009 tax credits now available

Over $25 million of equity capital was raised in the first 60 days of 2009 in addition to the $50 million raised in 2008. Companies should now have received notice that their investor's tax credit certificates for these investments are available for download from the eTCA website.

Because we were able to allocate 2008 tax credits to investments received by companies within the first 60 days of 2009, we have now opened the 2009 tax credit budgets. We have posted a budget usage graph on our website so all registrants can monitor availability of tax credits. This graph will be updated every second Friday, with more frequent updates provided as we approach budget capacity.

As indicated in the graph, we remind you that 25 per cent of each budget is being reserved for release on Sept. 1, 2009, to accommodate new program registrants and those of you who were unable to take advantage of tax credits earlier in the year.

If you have any questions, please contact your portfolio manager.

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January2009
Some tax credits to be saved for September

Another year of fundraising has begun, with nearly 160 companies seeking to raise over $290 million in equity capital.

To accommodate new companies that register this summer, we have held back 25 per ent of the year's tax credits and will make them available on Sept. 1, 2009. This change will also help companies that choose to raise funds later in the year.

If you have received an equity authorization starting Jan. 1, 2009, but do not raise the full amount before all available tax credits have been allocated, your equity authorization will be reinstated effective Sept. 1, 2009.

Please note that any 2008 tax credits that become available in 2009 will be allocated first-come, first-served, based on investments reported after Jan. 1, 2009 to our office through the new eTCA system (see October 2008 notice below).

If you have any questions, please contact your portfolio manager.

October2008
eTCA launched

The web-based electronic tax credit application system - eTCA -has been launched, providingelectronic service delivery 24 hours a day, seven days a week. Clients who log on to eTCA will be able to see up-to-date information on:

• Your current equity authorization
• Amount of equity capital raised to program budget
• Amount available under each program budget

Effective immediately, all share purchase reports will be submitted through eTCA rather than by fax or email to our branch. Online submission lets youreceive tax credit eligibility status right away for your investors, saving time and reducing uncertainty.

The first step to access eTCA is to register for a Business BCeID. The BCeID Program ensures secure access and protects you against unauthorized access to your information. Visit www.bceid.ca to register.

After you have your Business BCeID, contact your portfolio manager for further information on accessing this system. If you have any questions, please do not hesitate to contact your portfolio manager toll free at 1-800-665-6597.

July 28, 2008
Cleantech Venture Capital Budget launched

The new Cleantech Venture Capital Budget of $5 million in tax credits has been launched for the 2008 tax year, which will facilitate equity capital investment up to $16.67 million in B.C. companies substantially engaged in a qualifying activity related to the commercial exploitation of clean technology.

In accordance with Regulation 11(3) of the Small Business Venture Capital Act, substantially engagedis defined as 50 per cent or more of the company's assets and expenses are directed towards a qualifying activity, the company has a permanent establishment in B.C., and, not more than 20 per cent of the company's assets are located outsideB.C.

The qualifying activities making a company eligible for this new budget are listed below as stated inRegulation 11(1)(f) of the Small Business Venture Capital Act:

11 (1) (f) the manufacture and processing and research and development within British Columbia for commercial exploitation of technologies that

(i) increase energy efficiency and conservation,

(ii) reduce greenhouse gas emissions, or

(iii) reduce the environmental impact of energy production, generation, storage, transmission, delivery, provision or conversion

'Greenhouse gas' is defined by the Greenhouse Gas Reduction Targets Act as meaning any or all of carbon dioxide, methane, nitrous oxide, hydrofluorocarbons, perfluorocarbons, sulphur hexafluoride and any other substance prescribed by regulation.

If you believe your company qualifies under this budget, please submit a registration application and business plan demonstrating eligibility including the estimated amount of greenhouse gas reduction for the current fiscal year.

In each subsequent annual report, to be submitted by program registrants, the actual amount of greenhouse gas reduction for the fiscal year and an estimate for the subsequent fiscal year will be required. These amounts will be reported to other B.C. government agencies, and these agencies may request more information in order to validate the amounts reported.

May 26, 2008
Community Venture Capital Budget closeout procedures in place

The Venture Capital Programs continue to experience high demand resulting in the 2008 Community Budget being 86 per cent utilized. Effective immediately our office has putprocedures in place for receiving share purchase reportsunder the Community Venture Capital Budget. These procedures are:

1. Effective immediately for those clients authorized to raise funds under the Community Program, you should, before accepting monies from potential investors, email your portfolio managerto confirm that there are still funds in the budget. A copy of your email should also be sent to our general office email address: ecp@tbc.gov.bc.ca.

2. A portfolio manager will confirm by return email receipt of your message andwhether or not funds are availableto accommodate your program investment. The portfolio manager will record your request on a reservation list. You will then have 48 hours or two business days to submit the share purchase reports to our office by fax (250 952-0371) or by email. If the amount you requested is not available you will be added to a waiting list.

3. If the share purchase report is not received within the 48-hour or two-business-day period, the reservation/confirmation will be cancelled and the tax credits will be returned to the budget pool and released to clients on the wait list. The date/time stamp on the general email message will be used to verify the order confirmation and determine the start time for the 48-hour reservation period.

These steps have been designed to give all clients access toavailable tax credits. If you have any questions, please emailecp@gov.bc.ca or call toll free 1-800-665-6597.

May 5, 2008
Changes are coming to the B.C. Securities Legislation

The British Columbia Securities Commissionhas asked us to helpconvey the latest news on the proposed National Instrument 31-103 Registration Requirements that could potentially have an impact on your future operations, specifically, securities commissionregistration requirements.

Please review the following message to ensure that you are fully aware of the implications and what, if any effect, that they will have on your operations. Should you have any questions or wish to submit comments on the proposal please contact the securities commission directly.

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Subject: Publication for comment of NI 31-103

On February 29, 2008, the Canadian Securities Administrators (CSA) published for a second comment period proposed National Instrument 31-103 Registration Requirements. This rule is designed to streamline, harmonize and modernize registration requirements across the country. You can find the rule and all related documents here: http://www.bcsc.bc.ca/policy.aspx?id=6236&cat=BC%20Notices.

British Columbia Securities Commission recommends that you read the CSA notice first, as it provides important background and highlights the significant changes we have made to the rule since the first publication in February 2007. It also provides details on where and how to submit comments. The BC notice describes, among other things, how the BCSC proposes to approach the registration exemptions and exempt market dealer category.

Registration, when NI 31-103 comes into effect (likely Spring 2009), of investment fund managers, managers of investment funds - both public AND private - will be required. Proposed registration requirements (including minimum capital and insurance, financial reporting, compliance and supervision, and conflicts management) are set out in NI 31-103. The rule also contains a very limited exemption from registration for managers "private investment clubs" (see section 8.7 of NI 31-103). You can find additional discussion of the registration of fund managers on page 9 of the notice which accompanied the first publication: http://www.bcsc.bc.ca/uploadedFiles/CSA_Notice_Request_for_Comment.pdf.

Registration of Exempt Market Dealers

Today, every jurisdiction, except Ontario and Newfoundland and Labrador, has registration exemptions for capital-raising (e.g. the offering memorandum exemption; the accredited investor exemption). These exemptions are set out in NI 45-106. As a result of these exemptions, a person who sells prospectus-exempt securities outside of Ontario and Newfoundland and Labrador does not have to be registered.

However, when NI 31-103 comes into effect, every jurisdiction except for BC and Manitoba will repeal the registration exemptions for capital-raising. Without these exemptions, a person who is in the business of trading in prospectus-exempt securities will need to register as an exempt market dealer (EMD). NI 31-103 sets out the registration requirements for EMDs. The companion policy sets out guidance on what it means to be "in the business".

BC and Manitoba are proposing to maintain the registration exemptions for capital-raising and safe securities, subject to certain conditions:

• the exemptions will not be available to a person operating outside of BC or Manitoba who also wishes to operate in BC, and
• the exemptions will not be available to a person who is registered in any category (e.g. a mutual fund dealer or adviser) in any jurisdiction (including BC and Manitoba.

Also:

• a person relying on the exemptions must provide the investor with a risk acknowledgement form similar to that currently required under our offering memorandum exemption, and
• a person relying on the exemptions must file an annual report with the Commission (details to be worked out) outlining their use of the exemptions.

So, if an issuer only trades shares (solicits investments) in BC (i.e. from a BC office to BC investors) or Manitoba, it will not need to register as an exempt market dealer. A trade in any other Canadian jurisdiction will trigger the registration requirement.

Request for Comments

We encourage affected parties to submit written comments. All comments are due by May 29, 2008. Please consult the CSA notice for how and where to submit your comments: http://www.bcsc.bc.ca/uploadedFiles/securitieslaw/policyBCN/CSA_Notice_to_BCN2008-11(31-103).pdf

If you have any questions, please feel free to contact Ms. Laura Bliss of the BCSC. Typically she is in the office Wednesday. - Friday. Ms. Bliss’s contact information is:

Laura Bliss

Senior Legal Counsel

Policy Branch, Capital Markets Regulation Division

British Columbia Securities Commission

604-899-6666 (direct)

800-373-6393 (toll free in BC and Alberta)

In her absence, you can contact Mark Wang, Manager, Policy & Exemptions, at mwang@bcsc.bc.ca or 604-899-6658.

The Venture Capital Programs continue to experience high demand, resulting in the 2008 New Media Budget being sold out. All unused equity authorizations under the Equity Capital Budget are rescinded effective April 11, 2008.

The Venture Capital Programs continue to experience high demand, resulting in the 2008 Equity Capital Budget being sold out. All unused equity authorizations under the Equity Capital Budget are rescinded effective March 5, 2008.

The Investment Capital Branch has received approval to proceed with a project to automate the tax credit application process for the following types of program clients:

1. Eligible business corporation (EBC)
2. Employee share ownership plan (ESOP)
3. Employee venture capital corporation (EVCC)
4. Venture capital corporation (VCC)

The goals of this project include:

1. Providing our clients with a web access to the Tax Credit Application process. The single access will allow clients to use the appropriate features.
2. Creating a process that minimizes or eliminates manual intervention by ministry staff. This means that the process will be accessible, consistent and timely to all clients.
3. Providing clients with the ability to submit data with respect to their investors and the relevant investment detail directly to the system and obtain confirmation that data has been accepted or error messages in a timely manner.
4. Generating an electronic tax credit certificate record that can be accessed and printed by the individual investors. If this goal is not possible the system will allow clients to access and print the tax credit certificates for distribution to the investors.
5. Creating reports, accessible to each client that would provide information about investor investments processed, tax credit certificates generated, the status of each company’s equity capital authorization (amount used, amount remaining, etc.) and the tax credit budget that your equity authorization is using (ECP, CVCP, ESOP, EVCC, etc.).

The system design will be finalized over the next two or three weeks, and updateswill be provided on the ‘What’s New’ section of our web site.

As part of the development process we hopeclients from the various programs will provide input in to the development and possibly test the application before it goes into production.

If we contact you for assistance, we hopeyou can make yourselves available. Your commitment could be as much as the equivalent of a week’s work but it would be spread over the length of the project and would likely include only one or two sessions of one to four hours each. The rest of the time could be broken down toperiods of less than one hour.

Once this web access is operating, we will examine the value of expanding it to other parts of our programs. This could include the Additional Equity Applications, Reporting Business Investments, Annual Returns, the IPA Releases and Registration Applications.

The 2007 program budget for VCC/EBC single-year allocations under the New Media Venture Capital Program is now effectively sold out.

Therefore, under Section 29.1 of the Small Business Venture Capital Act, all unused equity authorizations under this program budget are hereby rescinded effective immediately. Any funds raised that have not been reported in accordance with our notice dated Aug. 17, 2007, will not be eligible for tax credits.

We are now accepting "Additional Equity Applications" for the 2008 program year.

Due to the success of the Investment Capital Programs, we are rapidly nearingcapacity for 2007 allocations under the New Media Budget. Please see the graph below. In anticipation of reaching budget capacity, our office has established the following procedures:

1. If you have a completed share purchase reportplease fax it to our office (250 952-0371) before 4:30 p.m. today. These will be allocated 2007 tax credits.

2. Any reports received after 4:30p.m. will be allocated 2007 tax credits on a first-come, first-served basis. We will confirm receipt of reports within two days.

3. Effective Monday morning (Aug. 20th), before accepting monies from investors, you must call our office toll free at 1-800-665-6597 and speak with the portfolio manager of the day.

4. The portfolio manager of the daywill confirm whether the budget canaccommodate your request and add your request to the waiting list.

5. If there are budget funds available, you will have 48 hours to submit the share purchase reportto our office by fax (250 952-0371). If the report is not received within 48 hours, the confirmation will be null and the tax credits will be returned to the budget pool.

6. The website will be updated daily with the latest budget figures.

This process has been designed to give all clientsequal access to the maximum amount of 2007 tax credits available.

Please ensurethe email address being used is accurate and is being monitored regularly.

If you have any questions about these procedures, please email or phone the portfolio manager of the dayat 1-800-665-6597.

The 2007 program budget for VCC/EBC single year allocations under the Equity Capital Program and Community Venture Capital Program are effectively sold out.

Under Section 29.1 of the Small Business Venture Capital Act, all unused equity authorizations under these two program budgets are hereby rescinded effective 12:30 p.m., June 26, 2007.

Any funds raised after this time will not be eligible for tax credits.

This does not apply to those program registrants who are authorized to raise funds under the New Media Venture Capital Program.

The final deadline to submit outstanding signed share purchase reports to the Investment Capital Branch is 9 a.m. Wednesday, June 27, 2007. Documents can be submitted via fax (250 952-0371) or emailed to your portfolio manager, who will confirm receipt.

We are now accepting Additional Equity Applications for the 2008 program year.

Due to the success of our office's programs again this year, as can be seen by the graph below, we are rapidly reaching ourbudgetfor single-year allocations granted for 2007 in the Community Venture Capital and Equity Capital program budgets. In anticipation of selling out, our office has established the following procedures:

1. The website will be updated daily with the latest budget figures.

2. When the program has sold out,an emailwill be sent to advise everyone registered.

3. The email will notethat all program registrants still have a shorttime to send in share purchase reports not previously submitted. Thismay be less than 24 hours and will probably be no more than 36 hours.

4. During thistime, share purchase reports will be accepted by either fax or email based on the time of receiptfirst-come, first-served.

5. It is the company's (not the individual investor's) responsibility to send in share purchase reports.

6. Receipt of share purchase reports will be confirmed by your portfolio manager.

7. Any share purchase reports received during this time but after budget capacity has been reached will be put on a waitlist for further review.

8. Applications for more equity authorizations to commence on Jan. 1, 2008, will be accepted upon budget closeout for 2007.

Please ensurethe email address being used is accurate and is being monitored regularly. If you have any questions about these procedures, please send your questions by email.

The 2006 tax credit budget has been fully allocated.Staff are currently processing the remaining applications andyour investors should receive their 2006 tax credits shortly.

Today is our first update on the status of 2007 fundraising. Everyone is encouraged to check the tax credit budget link frequently and keep up to date with fundraising. We intend to publish the status of the tax credit budgets based on share purchase reports we receive on the 15th of each month. We may increase this frequency to twice per month or weekly as the tax credit budgets near completion.

Note: To all registrants who hold an equity authorization under the Community Venture Capital Program Budget, you will notice that the Community Budget is now 79 per cent sold out. If the Community Budget sells out and tax credits are still available under the Equity Capital Budget, every registrant with an authorization under the Community Budget will automatically roll over in to the Equity Capital Budget. For more information on how the tax credit budgets work, please visit our questions and answers page.

Based on client reportings to date, the 2006 Tax Credit Budget may not be sold out.

In the interest of using the Tax Credit Budget fully, we are offering program registrants an opportunity to provide your investors with a 2006 tax credit instead of a 2007 tax credit – with conditions.

Any unused 2006 tax credits may be allocated first-come, first-seved to equity capital raised based on the date and time the share purchase reportsare received by our office. To qualify for the 2006 tax credits the EBC/VCC must:

• Have an authorization letter to raise equity capital dated on or after January 15, 2007.
• Submit by fax or email SPR by March 2, 2007.
• Confirm that the funds have been deposited in the EBC/VCC‘s bank or the lawyers trust account prior to March 2, 2007.
• Confirm that the share will be issued within 30 days.

Please note that share purchase reports already received and those received before March 1, 2007, with confirmation that funds have been deposited will be automatically listed as applicants for the 2006 tax credits.

By March 15, 2007, we will inform those program registrants who submitted share purchase reports whether or not 2006 tax credits will be issued. At that time we will request that a Tax Credit Application be submitted for these share purchase reports.These Tax Credit Certificates may not be issued until April 15, 2007, depending how many applicationsare received.

This notice should not be considered as a guarantee that 2006 tax credits will be issued to your investors. As such you should take every effort to make sure investors understand their investment may not qualify for a 2006 tax credit.

January 2007
Streamlining reduces red tape

The Investment Capital Branch has made severalchangesover the past several months to reduce the amount of paperwork and red tape involved in administering ourprograms.

Over the past year, we have heard from you that there are high administrative and compliance costs associated with the Province’s venture capital programs. You have raised concerns about:

• Access to capital and program waitlists.
• The duplication of effort where multiple investors are investing in a business.
• The number of incomprehensible calculations in our forms and the massive amounts of supporting. information that must be submitted.

We have addressed the concerns you’ve raised by:

• Eliminating administrative formalities that are no longer needed.
• Streamlining and simplifying those that are needed.
• Improving the transparency of their application.

So, we’ve eliminated obsolete and duplicate forms, simplified or eliminated complex and/or irrelevant practices, andreduced the amount of documentation that you must submit. For details and instructions associated with our streamlining changes please visit our website.

We have also re-designed our website to give youmore timely and relevant information. We hopethe interactive nature of our web pages and the resources that we have highlighted for you will be useful as you raise capital for your innovative ideas and businesses. Let us know if you found it helpful and what we can do to improve it.

Don’t forget to visit the website often for the latest update on tax credit availability.

Nov. 14, 2006
Update from the administrator

Thank you for making 2006 the most successful year ever for raising capital under the Small Business Venture Capital Act. This year, Eligible Business Corporations and Venture Capital Corporations like yours raised the maximum $44 million from investors under single-year equity authorizations. As you know, the tax credits were spent in record time.

In the coming months, your portfolio manager will be busy issuing over $13 million in tax credits to eligible investors. To assist us, please submit your Tax Credit Application as soon as possible. The deadline for these is Jan. 31, 2007.

As we anticipate another record-setting year, we are improving the way we allocate the 2007 tax credit budget. As a start, all qualifying registrants who apply for a 2007 equity allocation and who submit their Additional Equity Application on or before Dec. 1, 2006, will receive confirmation of their 2007 allocation by Jan. 1, 2007. For applications received after Dec. 1, we will make every effort to confirm your allocation as soon as possible.

To ensure that all registrants have the opportunity to raise capital from investors, we will continue to process new registration applications and requests for more equity authorizations throughout the year. As in past years, the amount authorized to all program registrants will exceed the program's budget to allow as many registrants as possible to participate in the program and all unused equity authorizations will be rescinded once the tax credits are exhausted.

Your portfolio manager will continue to work with you to ensure that allocations are reasonable and program dollars are used effectively. In addition, we are planning improvements to our website - www.equitycapital.gov.bc.ca - to help you, and your investors, monitor the availability of tax credits as the year progresses.

Looking forward, our staff will work diligently to ensure that this program continues to make a positive contribution to the growth of innovative small businesses in British Columbia.

Oct. 26, 2006
Annual tax credit programs sold out

The 2006 program budget for VCC/EBC single-year allocations is effectively sold out.

Under Section 29.1 of the Small Business Venture Capital Act, all unused equity authorizations are hereby rescinded effective noon, Oct. 26, 2006.

The final deadline to submit outstanding signed share purchase reports or Central Securities Registers to the Investment Capital Branch is 2 p.m. Friday, Oct. 27, 2006. Documents can be submitted via fax (250 952-0371) or emailed to your portfolio manager, who will confirm receipt.

In anticipation of another robust fund-raising year, we are now accepting "Additional Equity Applications" for the 2007 program year.