November 30, 2017

IN THE MATTER OF THE SECURITIES LEGISLATION OF ONTARIO (the Jurisdiction)

AND

IN THE MATTER OF THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS IN MULTIPLE JURISDICTIONS

AND

IN THE MATTER OF ROSALIND ADVISORS, INC. (the Filer)

Background

The principal regulator in the Jurisdiction has received an application from the Filer on its behalf and on behalf of Rosalind Capital Partners L.P., an Ontario limited partnership (the "Ontario Fund") and Rosalind Master Fund L.P., a Cayman Islands exempted partnership (the "Master Fund" and, together with the Ontario Fund, the "Funds"), for a decision under the securities legislation of the principal regulator (the Legislation) pursuant to section 15.1 of National Instrument 31-103 Registration Requirements and Exemptions (NI 31- 103), exempting the Filer from:

(a) the prohibition contained in section 13.5(2)(a) of NI 31-103 that prohibits a registered adviser from knowingly causing an investment portfolio managed by it, including an investment fund for which it acts as an adviser, to purchase a security of an issuer in which a responsible person or an associate of a responsible person is a partner, officer or director unless this fact is disclosed to the client, and the written consent of the client to the purchase is obtained before the purchase, to permit the Ontario Fund to invest in the Master Fund (the Related Issuer Relief); and

(b) the prohibition contained in section 13.5(2)(b) of NI 31-103 that prohibits a registered adviser from knowingly causing an investment portfolio managed by it, including an investment fund for which it acts as an adviser, to purchase or sell a security from or to the investment portfolio of (a) a responsible person, (b) an associate of a responsible person or (c) an investment fund for which a responsible person acts as an adviser, to permit the purchase and sale of portfolio securities between the Ontario Fund and the Master Fund (each an In-Specie Transaction, and the above section (b) is collectively, the In­Species Relief);

Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):

(a) the Ontario Securities Commission is the principal regulator for this application; and

(b) in respect of the Related Issuer Relief and the In-Species Relief, the Filer has provided notice that section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in each province and territory of Canada where security holders of the Ontario Fund are resident.

Interpretation

Defined terms contained in National Instrument 14-101 Definitions have the same meaning in this decision unless they are defined in this decision.

Representations

1. The Filer is a corporation established under the laws of Ontario with its head office located in Toronto, Ontario.

2. The Filer is registered in Ontario as an investment fund manager, a portfolio manager and an exempt market dealer and in each of Alberta, British Columbia, Manitoba and Quebec as an exempt market dealer

3. The Filer is the manager and portfolio adviser of the Funds.

4. The Ontario Fund was formed in May 2006 and has issued and will issue limited partnership units exclusively to Canadian investors pursuant to the "accredited investor exemption" or another exemption from the prospectus requirement under applicable Canadian securities laws. It is a non-redeemable investment fund.

5. The Master Fund was formed as a "feeder-master" structure and commenced issuing securities in May 2010.

6. The Master Fund has issued and will issue interests in the Master Fund to United States persons, Rosalind Offshore Fund, a Cayman Islands exempted company (the "Cayman Feeder Fund"), and other feeder funds formed from time to time, including the Ontario Fund.

7. Each of the Funds and the Cayman Feeder Fund has the same investment objectives and strategies and as such, the investments held by the Master Fund are compatible with the investment objectives and strategies of the Ontario Fund and the investments held by the Ontario Fund are compatible with the investment objectives and strategies of the Master Fund.

8. While not obligated to do so, the Ontario Fund and the Master Fund have been investing substantially in parallel as investment opportunities have arisen since the commencement of operations of the Master Fund.

9. None of the Funds is, or will become, a reporting issuer in Canada. Each Fund is not in default of securities legislation in any province or territory of Canada.

10. The Filer is not a reporting issuer in any jurisdiction of Canada and is not in default of securities legislation in any province or territory of Canada.

11. The Filer will provide timely notice of the transition contemplated hereunder to each of the investors in the Ontario Fund so that each investor will be able to redeem from the Ontario Fund prior to giving effect to such transition.

Fund-on-Fund Structure

12. The Filer wishes to cause the Ontario Fund to invest in the Master Fund.

13. The investment objectives and strategies of the Ontario Fund and the Master Fund are and will be substantially the same.

14. The fund-on-fund structure will permit the Filer to manage a single portfolio of assets for both the Ontario Fund and the Master Fund in a single investment vehicle structure.

15. Managing a single pool of assets provides economies of scale, allows the Ontario Fund to achieve its investment objectives in a cost efficient manner and will not be detrimental to the interests of other securityholders of the Master Fund.

16. The fund-on-fund structure is expected to increase the asset base of the Master Fund, which is expected to result in additional benefits to unitholders of the Master Fund, including more favourable pricing and transaction costs on portfolio trades, increased access to investments when there is a minimum subscription or purchase amount, and better economies of scale through greater administrative efficiency.

17. An investment in the Master Fund by the Ontario Fund will be effected at an objective price. According to the Filer’s policies and procedures, an objective price for this purpose, will be the net asset value (NAV) per security of the applicable class or series of the Master Fund.

18. The Master Fund will primarily hold publicly traded securities and will not hold greater than 10% of its assets in “illiquid assets”, as defined in National Instrument 81-102 Investment Funds (NI 81-102).

19. The Master Fund will not itself be a top fund in a fund-on-fund structure.

20. Securities of the Ontario Fund and the Master Fund have, or will have, matching redemption and valuation dates.

21. The Filer manages, or will manage, the liquidity of the Ontario Fund having regard to the redemption features of the Master Fund to ensure that it can meet redemption requests from investors of the Ontario Fund.

22. Effective as of January 1, 2018, the investment assets of the Ontario Fund and the Master Fund will be held by a qualified custodian, as defined under, and in accordance with, NI 31-103 and the proposed sections 14.5.2 to and including 14.6.2 of NI 31-103.

23. In the absence of the Consent Relief, the Ontario Fund is precluded from investing in the Master Fund unless the specific fact is disclosed to securityholders of the Ontario Fund and the written consent of the securityholders of the Ontario Fund to the investment is obtained prior to the purchase, since an officer and/or director of the Filer, who may be considered a responsible person (as per section 13.5 of NI 31-103) or an associate of a responsible person, may also be a partner, officer and/or director of the Master Fund.

24. The Ontario Fund will not vote the securities of the Master Fund held by it at any meeting of holders of such securities except that the Ontario Fund may, if the Filer so chooses, arrange for all of the securities it holds of the Master Fund to be voted by the beneficial holders of securities of the Ontario Fund to the extent the matter being voted on would have required approval of such beneficial holders had it occurred at the Ontario Fund level.

25. On and after January 1, 2018 the offering memorandum or other disclosure document of the Ontario Fund will be provided to investors in the Ontario Fund prior to the time of investment, and will make the disclosures required in accordance with applicable securities laws regarding the fund on fund structure of the Ontario Fund and the Master Fund. This will include revising its offering documents upon receipt of the exemptive relief being sought under this Application to disclose that commencing on January 1, 2018 (or such other appropriate date), the Ontario Fund will invest all or a substantial portion of its capital in the Master Fund and to obtain the consent of security holders of the Ontario Fund whose subscription is effective on and following January 1, 2018 (or such other appropriate date).

26. The investment by the Ontario Fund in the Master Fund represents the Filer’s business judgment, uninfluenced by considerations other than the best interests of the Ontario Fund and the Master Fund.

27. There will not be any duplication of management or performance fees paid to the Filer or any of its affiliates.

28. There will not be any duplication of incentive allocations, performance allocations or other similar participations in the profits of the Ontario Fund and the Master Fund by the Filer or any of its affiliates.

In-Specie Transactions and Submissions

29. The Filer wishes to engage in In-Specie Transactions pursuant to which the Ontario Fund will purchase securities of the Master Fund and as payment for the securities make good delivery of portfolio securities that meet the investment criteria of these Funds.

30. The Filer considers an investment by the Ontario Fund in the Master Fund by way of In-Specie Transaction, to be a more cost effective and efficient way for the Ontario Fund to achieve exposure to the portfolio securities than a direct investment in those securities.

31. In the circumstances, instead of the Ontario Fund disposing of portfolio securities and the Master Fund respectively purchasing the same securities and incurring unnecessary brokerage costs, the portfolio securities would, pursuant to each In-Specie Transaction, be acquired by the Master Fund.

32. As the Filer is a portfolio adviser of each Fund, the Filer would be considered to be a "responsible person" within the meaning of the applicable provisions of NI 31-103. Accordingly, without the In-Species Relief, the Filer would be prohibited from engaging the Funds in each In-Specie Transaction.

33. Each In-Specie Transaction will represent the business judgment of the Filer uninfluenced by considerations other than the best interests of the Funds concerned.

34. In connection with each In-Specie Transaction between the Ontario Fund and the Master Fund:

(a) where a Fund (Fund A) purchases securities of another Fund (Fund B) and Fund B receives portfolio securities from Fund A as payment:

(i) Fund B would, at the time of payment, be permitted to purchase the portfolio securities;

(ii) the portfolio securities are acceptable to the Filer, as portfolio adviser to Fund B, and are consistent with the investment objective of Fund B; and

(iii) the value of the portfolio securities is equal to the issue price of the securities of Fund B for which they are payment, valued as if the securities were portfolio assets of Fund B;

(b) Each Fund will keep written records of each In-Specie Transaction in a financial year of such Fund, reflecting the details of portfolio securities delivered to, or delivered by, such Fund and the value assigned to such portfolio securities, for a period of five years after the end of the fiscal year, the most recent two years in a reasonably accessible place;

(c) The Filer does not receive any compensation in respect of the In-Species Transaction and, in respect of the delivery of portfolio securities under the In­ Species Transaction, the only charge paid by the Fund may be a commission charged by the dealer executing the trade and/or any administrative charges levied by the custodian;

(d) Should any portfolio securities which are transferred in an In-Specie Transaction meet the definition of "illiquid asset" (as defined in NI 81-102) ("Illiquid Portfolio Securities"), the responsible portfolio manager or sub-adviser will obtain independent pricing for such Illiquid Portfolio Securities determined on the basis of reasonable inquiry immediately before effecting the In-Specie Transaction;

(e) If any Illiquid Portfolio Securities are the subject of an In-Specie redemption, the Illiquid Portfolio Securities will be transferred on a basis that fairly represents the portfolio of the Fund. The Filer will not cause any Fund to accept an in specie subscription or pay out redemption proceeds in specie if, at the time of the proposed In-Specie Transaction, Illiquid Portfolio Securities would represent more than an immaterial portion of the portfolio of the Fund. The valuation of any Illiquid Portfolio Securities which would be the subject of an In-Specie Transaction will be carried out according to the Filer's policies and procedures for the fair value of portfolio securities, including illiquid portfolio securities; and

(f) The Filer has determined that it is in the best interests of the Funds to receive the exemption sought and engage in In-Specie Transactions.

Decision

The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.

The decision of the principal regulator under the Legislation is that:

The Related Issuer Relief is granted provided that:

1. securities of the Ontario Fund are distributed in Canada solely pursuant to exemptions from the prospectus requirement under Canadian securities legislation;

2. the investment by the Ontario Fund in the Master Fund is compatible with the fundamental investment objectives of the Ontario Fund;

3. an investment in the Master Fund by the Ontario Fund will be effected at an objective price, calculated in accordance with section 14.2 of NI 81-106 and the Master Fund will primarily hold publicly traded securities and will not hold greater than 10% of its assets in “illiquid assets”, as defined NI 81-102;

4. the Ontario Fund will not purchase or hold a security of the Master Fund unless at the time of purchasing securities of the Master Fund, the Master Fund holds no more than 10% of its NAV in securities of other investment funds;

5. no management fees or incentive fees are payable by the Ontario Fund that, to a reasonable person, would duplicate a fee payable by the Master Fund for the same service;

6. no sales fee or redemption fees are payable by the Ontario Fund in relation to its purchases or redemptions of securities of the Master Fund that, to a reasonable person, would duplicate a fee payable by an investor in the Ontario Fund;

7. the Filer does not cause the securities of the Master Fund held by Ontario Fund to be voted at any meeting of the holders of such securities, except that the Filer may arrange for the securities the Ontario Fund holds of the Master Fund to be voted by the beneficial owners of the securities of the Ontario Fund who are not the Filer or an officer, director or substantial securityholder of the Filer; and

8. when purchasing and/or redeeming securities of Master Fund, the Filer shall, as investment fund manager of the Ontario Fund and the Master Fund, act honestly, in good faith and in the best interests of the Ontario Fund and the Master Fund, respectively, and shall exercise the care and diligence that a reasonably prudent person would exercise in comparable circumstances.

The In-Species Relief is granted provided that:

1. in the case of an In-Specie Transaction that involves the purchase by the Ontario Fund (in such case, the Transferor) of securities of the Master Fund (in such case, the Transferee):

(a) the Transferee would at the time of payment be permitted to purchase the portfolio securities delivered in specie by the Transferor;

(b) the portfolio securities are acceptable to the portfolio adviser of the Transferee, and consistent with the investment objective of the Transferee;

(c) the portfolio securities transferred by the Transferor as purchase consideration will be valued: (i) on the same valuation day on which the purchase price of the Transferee’s securities is determined; and (ii) at a value equal to the amount at which those portfolio securities were valued in calculating the net asset value used to establish the purchase price of the Transferee’s securities, as if the portfolio securities were assets of the Transferee and as if the Transferee was subject by subsection 9.4(2)(b)(iii) of NI 81-102;

(d) should the In-Specie Transaction involve the transfer of Illiquid Portfolio Securities, the portfolio adviser will obtain independent pricing determined on the basis of reasonable inquiry immediately before effecting the In-Specie Transaction; and

(e) each of the Transferor and the Transferee will keep written records of an In-Specie Transaction in a financial year of the Transferor and the Transferee, as applicable, reflecting details of the portfolio securities delivered to the Transferee, and the value assigned to such portfolio securities, for five years after the end of the financial year, the most recent two years in a reasonably accessible place;

2. in the case of an In-Specie Transaction that involves the redemption of securities of the Master Fund (the Transferor) by the Ontario Fund (the Transferee):

(a) the portfolio securities are acceptable to the portfolio adviser of the Transferee, and consistent with the investment objective of the Transferee;

(b) the portfolio securities transferred to the Transferee as proceeds of redemption for the Transferor’s securities will be valued: (i) on the same valuation day on which the redemption price of the Transferor’s securities is determined; and (ii) at a value equal to the amount at which those portfolio securities were valued in calculating the net asset value per security used to establish the redemption price of the Transferor’s securities, as contemplated by and as if the Transferor was subject to subsection 10.4(3)(b) of NI 81-102;

(c) should the In-Specie Transaction involve the transfer of Illiquid Portfolio Securities, the portfolio adviser will obtain independent pricing determined on the basis of reasonable inquiry immediately before effecting the In-Specie Transaction;

(d) if any Illiquid Portfolio Securities are the subject of an in specie redemption, the Illiquid Portfolio Securities will be transferred on a basis that fairly represents the portfolio of the Transferor;

(e) each of the Transferor and the Transferee will keep written records of an In-Specie Transaction in a financial year of the Transferor and the Transferee, as applicable, reflecting details of the portfolio securities delivered by the Transferor and the value assigned to such portfolio securities, for five years after the end of the financial year, the most recent two years in a reasonably accessible place; and

3. The Filers do not receive any compensation in respect of any sale or redemption of securities of the Transferor and, in respect of any delivery of portfolio securities further to an In-Specie Transactions, the only charge paid by the Transferor or the Transferee is the transfer charge.

“ Raymond Chan”

Raymond Chan – Manager

Investment Funds & Structured Products

Ontario Securities Commission

Headnote

National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions – Relief from the self-dealing prohibitions in National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations to permit a one-time reorganization into a fund-on-fund structure and on-going in-specie subscriptions and redemptions between pooled funds under common management subject to conditions.

Applicable Legislative Provisions National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations, section 13.5(2)(a) and section 13.5(2)(b).