S. 84(4.1)(a) distributions of proceeds

Return of Capital

The stated capital account maintained by the Corporation in respect of its Common Shares will be reduced by an amount equal to $0.145 multiplied by the number of Common Shares issued and outstanding as at the Return of Capital Record Date. The aggregate of the Reduction of Stated Capital is expected to be approximately $21.13 million, based on the number of Common Shares issued and outstanding as at the date of this Information Circular. However, the Corporation's expectation is that 3,850,000 additional Common Shares will be issued, pursuant to the exercise of stock options.

The Corporation

A TSXV-listed Alberta corporation with 149.6M common shares outstanding, whose principal asset was a 100% investment in the Subsidiary.

The Subsidiary

Ivory Resources Inc., a Caymans company which formerly engaged in exploration in Equatorial Guinea. Following a request made by the Subsidiary for arbitration by the International Chamber of Commerce, on January 22, 2015 it reached an agreement with the Government of Equatorial Guinea to relinquish all its rights under the terms of an Exploration Services Agreement in exchange for U.S.$31.5M.

Investments

As at May 1, 2015, the Corporation had available funds and investments of $44,720,000. This is comprised of the Ram Power Investment and cash and cash equivalents of $34,720,000. The Corporation intends to use its available funds to fund the Return of Capital, to invest in each of equity, debt instruments and other investments as part of its focus as an investment issuer and for general and administrative expenses. The Corporation currently intends to make investments of up to $10 million in the next 12 months.

Ram Power Investment

. On April 30, 2015, the Corporation announced it had completed an investment in Ram Power, a renewable energy company listed on the TSX, as part of the approximately $74 million subscription receipt financing by Ram Power.

COB

The proposed COB, which constitutes a Change of Business pursuant to the policies of the TSXV, has been conditionally approved by the TSXV. Upon completion of the proposed COB, the Corporation's primary focus will be to seek superior returns by making investments in equity, debt or other securities of publicly traded or private companies or other entities, providing financing in exchange for pre-determined royalties or distributions and the acquisition of all or part of one or more businesses, portfolios or other assets.

Canadian income tax consequences

Management has determined that the amount of the Return of Capital will be less than the paid-up capital of the Common Shares for ITA purposes. S. 84(4.1) does not apply to the Return of Capital, provided that (i) the Return of Capital can reasonably be considered to have been derived from proceeds of disposition realized by the Corporation (or by a person in which the Corporation had a direct or indirect interest at the time the proceeds were realized, such as the Subsidiary) from a transaction that occurred outside the ordinary course of the business of the Corporation (or the Subsidiary) but within the period that commenced 24 months before the Return of Capital, and (ii) no other amount that may reasonably be considered to have derived from such proceeds was paid by the Corporation as a reduction of paid-up capital prior to the Return of Capital. Therefore, the Return of Capital should be treated as a tax-free return of paid-up capital (subject to there being a reduction of the adjusted cost base of the Common Shares) and not as a deemed dividend pursuant to subsection 84(4.1).

Overview

After rolling its exploration assets (the "New Probe Assets") into a new Ontario subsidiary (New Probe), so that it will still retain the Borden gold project, Probe will distribute its common shares of New Probe to its shareholders as a paid-up capital distribution. Also occurring under an Ontario Plan of Arrangement will be an exchange of all the Probe common shares (other than of dissenters) for Goldcorp common shares (together with nominal cash so as to require a joint s. 85(1) election to achieve Canadian rollover treatment), with Goldcorp then dropping its Probe shares into a wholly-owned subsidiary ("Subco") and causing their amalgamation (with Subco as the survivor.) The former Probe shareholders will now hold 1.6% of the Goldcorp shares (as well as 100% of New Probe). The share exchange and amalgamation is intended to qualify as a forward triangular merger - although Probe is believed to be and have been a PFIC and Goldcorp is believed not to be a PFIC, so that Code rollover treatment generally would not be available as per a proposed retroactive Regulation.

See summary under Mergers & Acquisitions - Shares for Shares and Nominal Cash.

Overview

Under a BC Plan of Arrangement, Coventry is to transfer most of its subsidiaries (the "Targets") to Western Rift (a subsidiary of Chalice) in consideration for Chalice shares, which Coventry will then transfer to its shareholders as a stated capital distribution. The Arrangement is expected to result in the Coventry shareholders holding 15.46% of the Chalice shares, and in Coventry holding only cash and a project in Alaska.

See detailed summary under Cross-Border Acquisitions – Inbound – Asset sale/share distribution.