October 9, 2025

(the Jurisdiction)

AND

IN MULTIPLE JURISDICTIONS

AND

RP INVESTMENT ADVISORS LP (the Filer)

AND

THE Funds

(as defined below)

The principal regulator in the Jurisdiction has received an application (the Application) from the Filer on behalf of the RP Alternative Global Bond Fund and the RP Alternative Credit Opportunities Fund (the Existing Funds) and any additional alternative mutual funds of which the Filer will be the manager and portfolio manager in the future (the Future Funds and, together with the Existing Funds, the Funds), for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) that grants relief to each of the Funds from subparagraph 2.6.1(1)(c)(iv) of National Instrument 81-102 – Investment Funds (NI 81-102), which restricts an alternative mutual fund from selling a security (other than a government security as defined in NI 81-102) of an issuer short if, at the time, the aggregate market value of the securities of that issuer sold short by the fund exceeds 10% of the alternative mutual fund’s net asset value (NAV) in order to permit each of the Funds to short sell index participation units (IPUs) of one or more investment funds (each, an IPU Issuer) up to a maximum of 100% of a Fund’s NAV at the time of the sale (the Requested Relief).

Under National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions:

A. the Ontario Securities Commission is the principal regulator for this Application, and

B. 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 of the other provinces and territories of Canada (together with Ontario, the Jurisdictions).

Interpretation

Terms defined in MI 11-102, National Instrument 14-101 – Definitions, NI 81-102, and NI 31-103 have the same meaning if used in this decision, unless otherwise defined.

The following terms have the following meanings:

Aggregate Exposure Limit means the aggregate gross exposure restriction in subsection 2.9.1 of NI 81-102, which places an overall limit on an alternative mutual fund’s exposure to cash borrowing, short selling and specified derivatives (excluding specified derivatives used for hedging purposes) equal to 300% of such fund’s NAV;

Existing Relief means, collectively, the Filer’s exemptive relief decisions (i) In the Matter of RP Investment Advisors LP and the Funds dated January 2, 2025; and (ii) In the Matter of RP Investment Advisors LP and the Funds dated April 30, 2025;

Government Securities as defined in the Existing Relief, includes and is limited to: (i) a “government security” as defined in NI 81-102; and (ii) an evidence of indebtedness issued, or fully and unconditionally guaranteed as to principal and interest, by any of the federal government if the United Kingdom or the federal government of Germany; and

Prospectus means a simplified prospectus of a Fund prepared in accordance with Form 81‑101F1 Contents of Simplified Prospectus under NI 81-101 as the same may be amended from time to time.

Representations

This decision is based on the following facts represented by the Filer:

The Filer

1. The Filer is a limited partnership formed under the laws of the Province of Ontario with its head office located in Toronto, Ontario.

2. The Filer is registered as (i) an investment fund manager in Ontario, Québec and Newfoundland and Labrador; (ii) an adviser in the category of portfolio manager in, British Columbia, Ontario and Québec; (iii) a dealer in the category of exempt market dealer in British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Québec, New Brunswick, Nova Scotia, Prince Edward Island, Newfoundland and Labrador, Northwest Territories, Nunavut and Yukon under the securities legislation of the Jurisdictions; and (iv) a commodity trading manager in Ontario under the Commodity Futures Act (Ontario).

3. The Filer is the investment fund manager and portfolio manager of the Existing Funds and will be the investment fund manager and portfolio manager of the Future Funds. As such, the Filer is, or will be, responsible for managing the assets of the Funds and has, or will have, complete discretion to invest and reinvest the Funds’ assets and is, or will be, responsible for executing all portfolio transactions.

4. The Filer is not in default of applicable securities legislation in any Jurisdiction.

The Funds

5. Each of the Funds is, or will be, organized as a trust established under the laws of the Province of Ontario or another Jurisdiction.

6. Each of the Funds is, or will be, as the case may be, an alternative mutual fund governed by the provisions of NI 81-102, subject to any relief granted therefrom by the securities regulatory authorities.

7. Units of the Funds are, or will be, offered by Prospectus and fund facts documents filed in each of the Jurisdictions.

8. Each of the Funds is, or will be, a reporting issuer in the Jurisdictions.

9. The investment objective(s) of each Fund is, or will be, as the case may be, set out in the Fund’s Prospectus.

10. The current risk rating assigned by the Filer to each of the Existing Funds is Low to Medium and the Filer believes that there will be no change in the risk rating of the Existing Funds by virtue of the Requested Relief.

11. The Existing Funds are not in default of the securities legislation of any of the Jurisdictions.

IPU Issuers

12. The portfolio holdings of IPU Issuers are generally diversified.

13. IPU Issuers seek to provide investment results that correspond generally to the performance of a specified widely quoted market index comprised of multiple issuers by holding a portfolio of securities that are included in the index or otherwise investing in a manner that causes the IPU Issuer to replicate the performance of that index.

14. The portfolio holdings of IPU Issuers are generally liquid.

15. The creation process for IPUs of IPU Issuers can quickly increase the available supply of IPUs of IPU Issuers in the marketplace, making the potential for a liquidity issue inherently lower.

16. The weight of each underlying security held in the portfolio of an IPU Issuer substantially corresponds to the weight of such security in the underlying index.

The Requested Relief

17. Subsection 2.1(1.1) of NI 81-102 restricts an alternative mutual fund from purchasing a security of an issuer, entering into a specified derivatives transaction or purchasing an IPU if, immediately after the transaction, more than 20% of its NAV would be invested in securities of any one issuer (the Concentration Restriction).

18. Subsection 2.1(2) of NI 81-102 provides an exception to the Concentration Restriction for an IPU that is a security of an IPU Issuer. The Filer submits that the rationale for this exception is, in part, that an IPU Issuer should be considered as a “look-through” vehicle in that it is comprised of and represents a diversified group of issuers whose securities it holds in proportion to the underlying index, thereby mitigating the concentration risk otherwise associated with a fund holding the securities of a single issuer. The Filer believes a similar rationale can be applied with respect to the shorting of IPU Issuers.

19. A significant risk associated with short positions generally is the potential for the short seller to be unable to obtain the securities required to cover the short position, or to be unable to obtain such securities without additional costs, at the required time due to a lack of liquidity in the market. The Filer submits that the liquidity of IPU Issuers as described above significantly reduces the risk that a fund may not be able to cover or exit a short position in an IPU Issuer. On this basis, short sales of IPU Issuers will not have the same risk profile as a short sale of a single issuer or of a security that lacks the liquidity of IPU Issuers.

20. The Funds are, or will be, as the case may be, permitted to short sell IPUs of multiple IPU Issuers up to the Aggregate Exposure Limit. The Filer submits that shorting a single IPU Issuer is preferable in certain cases to shorting multiple IPU Issuers where the liquidity of the single IPU Issuer being sold short is higher than other IPU Issuers tracking the same index, or where the underlying index tracked by a particular IPU Issuer otherwise presents more favourable investment characteristics than other IPU Issuers.

21. The Filer is of the view that, in the case of IPU Issuers, given their high degree of diversity and liquidity, the concentration risk otherwise associated with shorting securities of a single issuer is mitigated and, as a result, the Requested Relief would permit the Funds to benefit from efficiencies without prejudicing investors.

22. The Requested Relief would permit each Fund to short sell IPUs of IPU Issuers without otherwise impacting such Fund's ability to borrow cash or engage in short sales under NI 81-102, in circumstances where the Filer believes that it is more beneficial to gain the desired short exposure to IPU Issuers: (a) through shorting fewer IPU Issuers than would otherwise be necessary as a result of the Concentration Restriction; and (b) by way of short sales up to the Aggregate Exposure Limit rather than through the use of specified derivative transactions.

23. While a Fund may acquire exposure, including short exposure, to IPU Issuers in pursuit of its investment strategy through the use of specified derivative transactions, the Filer believes that engaging in the physical short selling of IPU Issuers may provide a faster, more efficient and flexible means of achieving diversification and hedging against market risk.

24. The Filer is of the view that it would be in the best interest of each of the Funds to physically short sell IPUs of IPU Issuers, up to the Aggregate Exposure Limit at the time of sale, instead of being limited to achieving that degree of leverage through either specified derivatives alone, or a combination of physical short selling and specified derivatives, for reasons which include:

(a) In some circumstances, the availability of derivatives with similar risk characteristics to corresponding indices may be limited. Alternatively, pricing of a short position at a particular point in time may be preferable to the pricing of a corresponding derivatives contract.

(b) Granting the Requested Relief would expand the scope of available tools at the disposal of the Filer, as portfolio manager, to achieve market hedging, and thereby provide the Filer, as portfolio manager, with the best execution and best liquidity.

(c) The Requested Relief is generally less risky than certain derivatives transactions by allowing the Fund to, in part, mitigate against settlement risk (i.e., the risk that one of the parties to the derivatives contract defaults under the derivatives contract). Use of derivatives may also be incrementally riskier by exposing the Fund to operational risk (e.g., the case of a party to a derivatives contract failing to maintain adequate internal procedures or controls including intra-day settlements or managing closing-out the transaction) and liquidity risk.

25. The Requested Relief would allow the Filer, as portfolio adviser of the Funds, greater flexibility and liquidity in pursuing a hedging strategy that reduces potential market volatility by expanding options for hedging to include selling highly liquid IPU Issuers short.

26. Notwithstanding the Requested Relief, the Funds would otherwise still be required to comply with all of the requirements applicable to alternative mutual funds in subsections 2.6.1 and 2.6.2 of NI 81-102, subject to the Existing Relief and any additional relief which may be granted by the securities regulatory authorities.

27. The Requested Relief would not change a Fund's obligation to comply with the Aggregate Exposure Limit. The Aggregate Exposure Limit would continue to apply. A decision to grant the Requested Relief would not permit a Fund to exceed the Aggregate Exposure Limit through a combination of investment strategies.

28. In the event that a Fund's aggregate exposure ever exceeds the Aggregate Exposure Limit, subsection 2.9.1(5) of NI 81-102 would require the Fund to, as quickly as commercially reasonable, take all necessary steps to reduce the aggregate exposure to 300% of the Fund's NAV or less.

29. Each short sale by a Fund will be made in a manner consistent with the Fund's investment objective(s), strategies and restrictions.

30. In connection with the Existing Relief and the Requested Relief, each Fund has implemented (or will implement) the following controls when conducting a short sale:

(a) the Fund assumes (or will assume) the obligation to return to the borrowing agent the securities borrowed to effect the short sale;

(b) the Fund receives (or will receive) cash for the securities sold short within normal trading settlement periods for the market in which the short sale is effected;

(c) the Filer monitors (or will monitor) the short positions within the constraints of the Existing Relief and the Requested Relief as least as frequently as daily;

(d) the security interest provided by the Fund over any of its assets that is required to enable the Fund to effect a short sale transaction is made in accordance with industry practice for that type of transaction and relates only to obligations arising under such short sale transactions;

(e) the Filer maintains (or will maintain) appropriate internal controls regarding short sales, including written policies and procedures for the conduct of short sales, risk management controls and proper books and records; and

(f) the Filer keeps (or will keep) proper books and records of short sales and all assets of a Fund deposited with borrowing agents as security;

31. Each Fund's Prospectus will contain adequate disclosure of the Fund's short selling activities, including the material terms of the Requested Relief.

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 Requested Relief is granted provided that:

(a) the only securities that a Fund will sell short (other than Government Securities, in a manner consistent with the Existing Relief), resulting in the aggregate market value of the securities of an issuer sold short by the Fund exceeding 10% of the Fund’s NAV at the time of sale, will be IPUs of IPU Issuers;

(c) a Fund may sell an IPU of an IPU Issuer short or borrow cash only if, immediately after the transaction: (i) the aggregate market value of all securities sold short by the Fund (excluding Government Securities) does not exceed 100% of the NAV of the Fund; and (ii) the aggregate market value of securities sold short by the Fund (excluding Government Securities) combined with the aggregate value of cash borrowing by the Fund does not exceed 100% of the NAV of the Fund;

(d) each Fund will otherwise comply with all of the requirements applicable to alternative mutual funds in the applicable provisions of NI 81-102, subject to the Existing Relief and any other relief which may be granted therefrom by the securities regulatory authorities;

(e) a Fund’s aggregate exposure to short selling, cash borrowing and specified derivatives used for purposes other than hedging will not exceed the Aggregate Exposure Limit;

(f) each short sale will be made consistent with the Fund’s investment objectives and investment strategies; and

(g) each Fund’s Prospectus discloses, or will disclose at the time of its next renewal, as applicable, that the Fund is able to sell short IPUs of one or more IPU Issuers in an amount up to 100% of the Fund’s NAV at the time of sale, including the material terms of this decision.

“Darren McKall”

Darren McKall Associate Vice President, Investment Management Division Ontario Securities Commission

Application No. 2025/0536

SEDAR+ Project No. 6336775

RP Investment Advisors LP (Re), 2025 CanLII 102136

Case Summary