March 31, 2012. Beginning with the first quarter of 2012, the Company’s unaudited interim financial statements will be prepared and filed in accordance with US GAAP. 

Phase III will conclude when the Company files its annual audited financial statements for the year ending December 31, 2012 prepared in accordance with US GAAP. 

## Financial Statement Impacts - US GAAP: 

The area identified to date where differences between US GAAP and Canadian GAAP is expected to have the most significant financial statement impacts is outlined below. The identified impacts are unaudited and are subject to change based on further analysis. 

## Employee Future Benefits: 

Under Canadian GAAP, the accrued benefit asset or liability associated with defined benefit plans is recognised on the balance sheet with a reconciliation of the recognised asset or liability to the funded or unfunded status being disclosed in the notes to the financial statements. The accrued benefit asset or liability excludes unamortized balances related to past service costs, actuarial gains or losses and transitional obligations which have not yet been expensed. 

US GAAP requires recognition of the funded or unfunded status of defined benefit plans on the balance sheet, with the opening unamortized balances related to past service costs, actuarial gains or losses and transitional obligations recognised on the balance sheet as a component of accumulated other comprehensive income. Changes to past service costs, actuarial gains or losses and transitional obligations which are not immediately recognised as components of net pension expense 

are required to be recognised in other comprehensive income. Upon adoption of US GAAP, the Company will recognise the unfunded status of its defined benefit plan on the balance sheet. 

Additional differences between Canadian GAAP and US GAAP in the accounting for defined benefit plans include the determination of the measurement date and the period over which pension expense is recognised. Canadian GAAP allows the use of a measurement date up to three months prior to the date of an entity’s fiscal year end. US GAAP requires the entity’s fiscal year end to be used as the measurement date. Canadian GAAP allows the use of an attribution period that extends beyond the date when the credited service period ends, under specific circumstances, for defined benefit pension plans. US GAAP allows the use of an attribution period up to the date when credit service ends for defined benefit pension plans. 

The above differences are expected to impact the calculation and recognition of the Company’s benefit obligation which will be mostly offset by a corresponding change to Accumulated Other Comprehensive Income. 

The above items do not represent a complete list of expected differences between US GAAP and Canadian GAAP, and are subject to change. Other less significant differences have also been identified. Analysis also remains ongoing and additional areas where the Company’s financial statements may be materially impacted may be identified prior to the Company’s voluntary preparation and filing of its audited US GAAP financial statements for the year ended December 31, 2011. A detailed reconciliation between the Company’s audited Canadian GAAP 

and US GAAP financial statements for 2011, including 2010 comparatives, and any additional areas where significant adjustments may be required in accordance with US GAAP, will be disclosed as part of that voluntary filing. 

The unaudited, estimated quantification and reconciliation of the Company’s balance sheest as at December 31, 2011 and December 31, 2010 prepared in accordance with US GAAP versus Canadian GAAP, and based on the differences identified to date, may be summarized as follows: 

Liabilities impact to long-term debt stated seperately as of December 31, 2011 are estimated to increase by approximately $2.8 million (December 31, 2010: $1.6 million). The estimated increase is due to the expected increase in the pension liability in accordance with US GAAP. 

Shareholders’ equity as of December 31, 2011 is estimated to decrease by approximately $2.8 million (December 31, 2010: $1.6 million). The estimated decrease is due to the expected recognition of the past service costs and net actuarial losses related to the defined benefit plan in accordance with US GAAP. 

Other assets as of December 31, 2011 are estimated to increase by approximately $1.6 million (December 31, 2010: $1.2 million). The estimated increase is due to the reclassification of deferred debt costs in accordance with US GAAP. 

Long-term debt as of December 31, 2011 is estimated to increase by approximately $1.6 million (December 31, 2010: $1.2 million). The estimated increase is due to the reclassification of deferred debt costs in accordance with US GAAP. 

## Critical Accounting Estimates 

The preparation of the Company’s financial statements in accordance 

