dundee corporation 2015 third quarter report · september 2015 – dundee corporation 3 u...

DUNDEE CORPORATION

2015 THIRD QUARTER REPORT

SEPTEMBER 2015 – DUNDEE CORPORATION 1

DUNDEE CORPORATION

Management’s Discussion and Analysis

Dundee Corporation (the “Corporation” or “Dundee Corporation”) is a public Canadian independent holding company, listed

on the Toronto Stock Exchange (“TSX”) under the symbol “DC.A”. Through its operating subsidiaries, the Corporation is

engaged in diverse business activities in the areas of investment advisory, corporate finance, energy, resources, agriculture, real

estate and infrastructure. The Corporation also holds, directly and indirectly, a portfolio of investments mostly in these key areas,

as well as other select investments in both publicly listed and private enterprises.

This Management’s Discussion and Analysis (“MD&A”) has been prepared with an effective date of November 12, 2015

and provides an update on matters discussed in, and should be read in conjunction with the Corporation’s audited

consolidated financial statements, including the notes thereto, as at and for the year ended December 31, 2014 (the “2014

Audited Consolidated Financial Statements), together with the accompanying MD&A for the year then ended, and with

the unaudited condensed interim consolidated financial statements of the Corporation as at and for the three and nine

months ended September 30, 2015 (the “September 2015 Interim Consolidated Financial Statements”), all of which have

been prepared using International Financial Reporting Standards (“IFRS”). All amounts in this MD&A are in Canadian

dollars unless otherwise specified. Tabular dollar amounts, unless otherwise specified, are in thousands of dollars, except

for per share or per unit amounts. This MD&A contains forward looking statements that are based on certain estimates

and assumptions and involve risks and uncertainties. Actual results may vary materially from management’s

expectations. See the “Cautionary Note Regarding Forward Looking Statements” section later in this MD&A for further

information.

STRATEGY

In mid-2014, the Corporation announced its strategy to create value for its stakeholders through the establishment of a wealth

management business focused on the high-net-worth and ultra-high-net-worth markets, supported by top quality investment

products, and managed by a team of experienced portfolio managers. In parallel with its wealth management vision, the

Corporation has moved to rationalize its merchant capital portfolio, focusing on those investments that the Corporation considers

core to its expertise and aligned to its objectives of sustainable growth and value for shareholders. It has done so while divesting

itself in an orderly and responsible manner of those assets that it no longer considers core to its business. The Corporation has

retained and recruited top management teams for its subsidiaries. Over the past 15 months, the Corporation has raised almost

$400 million from the sale of non-core portfolio assets. These initiatives have positioned the Corporation for a recovery in the

energy and resource sector, and the re-launch of its wealth management business.

OVERVIEW OF FINANCIAL RESULTS

The Corporation is reporting a net loss attributable to shareholders during the three months ended September 30, 2015 of $235.9

million or a loss of $4.05 per share, compared with a net loss of $78.7 million or $1.44 per share incurred during the same period

of the prior year. On a year-to-date basis, the net loss attributable to shareholders was $404.2 million or $7.03 per share,

compared with a net loss of $140.2 million or $2.68 per share incurred during the first nine months of the prior year. During the

current quarter, the Corporation wrote down the carrying value of its resource properties held through its investment in United

Hydrocarbon International Corp. by $215.2 million, reflecting its fair value in a market with severely depressed energy prices.

Lower energy and resource prices, and the impact of their decline on other segments of the economy, including real estate, are

clearly manifested in the Corporation’s reported results.

The market value of each of the Corporation’s investments in Dundee Precious Metals Inc. and DREAM Unlimited Corp. has

been significantly affected by these market conditions. During the nine months ended September 30, 2015, the trading value per

share of the Corporation’s investment in DREAM Unlimited Corporation declined from $9.57 at December 31, 2014 to $7.03 at

September 30, 2015, resulting in a loss to the Corporation of $55.0 million. The Corporation’s investment in Dundee Precious

Metals Inc., which had previously been accounted for on an equity basis, caused a further loss of $134.2 million, and reflects a

trading value of $2.17 per share as at September 30, 2015.


Real Estate -$297.9

24%

Energy - $276.5 23%

Financial - $260.1 21%

Mining - $171.5 14%

Agriculture - $93.0 8%

Pharmaceuticals -$68.2

6%

Industrial - $25.6 2% Other - $20.8

2%

Capital Allocated by Industry Sector at Market Value ($ Millions)as at September 30, 2015

Real Estate - $297.9

Energy - $276.5

Financial - $260.1

Mining - $171.5

Agriculture - $93.0

Pharmaceuticals - $68.2

Industrial - $25.6

Other - $20.8

These losses, combined with the write down of the Corporation’s investment in United Hydrocarbon International Corp., account

for almost 80% of the Corporation’s reported net loss before non-controlling interests during the first three quarters of 2015, and

90% of the loss reported in the third quarter itself.

While market conditions have eroded the value of the Corporation’s portfolio of investments, restructuring has continued within

the Corporation’s agricultural operating subsidiary, Blue Goose Capital Corp. Led by a new management team, Blue Goose

Capital Corp. reported a $7.6 million improvement in the net operating loss before income taxes. As well, and in order to

preserve capital, operations within United Hydrocarbon International Corp. have been reduced to approximately $1.5 million per

month, and ongoing efforts will seek to ensure the preservation of value of the property until such time as exploration can be

resumed. The Corporation continues to monitor its portfolio of securities, having recently participated in a plan of arrangement

that saw the acquisition by Oban Mining Corporation of three of the Corporation’s equity accounted investments; namely, Eagle

Hill Exploration Corporation, Corona Gold Corporation and Ryan Gold Corp. The plan of arrangement improved the liquidity of

the Corporation’s investment and increased the underlying trading value by $3.7 million.

Cash at the corporate level increased to $67.2 million at September 30, 2015, compared with $24.5 million at the end of the prior

year. In addition, the Corporation has repaid all amounts due pursuant to its exchangeable debentures, while maintaining its

current borrowing levels constant at approximately $93 million.

At the core of the Corporation’s vision is the creation of an asset management division through which it will build a profitable,

client-centric investment counsel/portfolio manager (“ICPM”) platform supported by world-class asset management and top

quality investment products designed to achieve superior long-term, risk adjusted returns. The ICPM strategy includes

developing integrated and diversified financial products and services focused on the high-net-worth and ultra-high-net-worth

markets. The asset management platform plans to capture new opportunities in investment management through a full spectrum

of model portfolios spanning core investments, exchange traded funds (“ETFs”) and proprietary private equity funds and

structured products, managed by a team of experienced portfolio managers. During 2015, the Corporation launched two

alternative investment products: Dundee Acquisition Ltd., the first Canadian special purpose acquisition corporation launched in

Canada, which raised over $112.3 million in its initial public offering earlier in 2015; and, Dundee Sarea Acquisition I Limited

Partnership, a private equity fund with committed capital of $112.5 million designed to invest in companies requiring turn-around

expertise in North America and Europe.

Since announcing its strategic direction in mid-2014, the Corporation has continued the divestiture of non-core assets, raising

almost $400 million in cash, reducing debt levels, and funding the operations of those businesses that are considered core to its

growth. The Corporation believes that its realigned strategic direction and business strategies are building blocks to long-term

value creation for shareholders and enhanced share performance for its Class A subordinate voting shares.

DUNDEE CORPORATION’S CAPITAL ALLOCATED BY INDUSTRY SECTOR


UNDERSTANDING THE ALLOCATION OF DUNDEE CORPORATION’S CAPITAL

Certain of the Corporation’s investments trade in public markets, while other investments are in debt or equity securities of private companies. While the

Corporation has applied valuation methodologies to estimate the market value of its portfolio of non-publicly traded investments, these valuation methodologies

have not been applied to operating subsidiaries and equity accounted investments that are not publicly traded. For purposes of the above schedule, the

“market value” of the Corporation’s non-public operating subsidiaries and non-public equity accounted investments is equal to their underlying carrying

value.

** Before accounting for deferred income tax assets and liabilities in respect of the Corporation’s investments in operating subsidiaries, which are not recognized

in the Corporation’s consolidated financial statements as per IAS 12.

Carrying Value Market Value* Market Value*

as at as at as at

September 30, 2015 September 30, 2015 December 31, 2014

Operating Subsidiaries

Operating subsidiaries are not recorded as individual investments in the Corporation's

consolidated financial statements. Instead, the accounts of the operating subsidiary

are consolidated with those of the Corporation on a line-by-line basis. For example, the 582,891$ 563,556$ 645,220$

revenue generated by an operating subsidiary is reported as revenue of the Corporation

in the consolidated statement of operations.

Equity Accounted Investments

Investments that are accounted for using the equity method are separately disclosed in the

Corporation's consolidated statement of financial position as "Equity accounted investments".

These investments are initially recorded at the Corporation's cost of acquisition. Subsequently, 170,248 170,285 265,878

the original cost is increased or decreased in proportion to the Corporation's share of earnings

or losses generated by the investee.

Investments

All other investments are designated as "Investments" in the Corporation's consolidated

statement of financial position. These investments may include investments in equity or

debt securities of public or private companies in a variety of sectors. These investments 479,802 479,802 653,696

are reported in the Corporation's consolidated financial statements at their estimated fair

value.

Corporate Account Balances

Corporate account balances represent balances of the Corporation's capital that are not

directly attributable to a particular investment. These balances include cash held by the

Corporation directly, offset by the Corporation's direct obligations, and obligations (95,285) (92,533) (229,739)

in respect of its credit facilities.

SHAREHOLDERS' EQUITY 1,137,656$ 1,121,110$ 1,335,055$

Less: Shareholders' equity attributable to holders of:

Preference Shares, series 2 (84,053) (86,985) (86,985)

Preference Shares, series 3 (43,015) (43,015) (43,015)

SHAREHOLDERS' EQUITY ATTRIBUTABLE TO CLASS A

SUBORDINATE SHARES AND CLASS B SHARES OF THE CORPORATION 1,010,588$ 991,110$ 1,205,055$

Number of Class A Subordinate Shares and Class B Shares of the Corporation

outstanding

Class A Subordinate Shares 55,531,801 53,196,258

Class B Shares 3,115,232 3,115,235

58,647,033 56,311,493

SHAREHOLDERS' EQUITY ON A PER SHARE BASIS** 17.23$ 16.90$ 21.40$

1

2

3

4


UPDATE ON BUSINESS STRATEGIES OF OPERATING SUBSIDIARIES

Operating Subsidiaries as at September 30, 2015

1. See note 34 “Segmented Information” to the September 2015 Interim Consolidated Financial Statements for a more detailed analysis of the carrying value of

individual assets and liabilities attributed to each operating subsidiary.

2. See note 22 “Non-Controlling Interest” to the September 2015 Interim Consolidated Financial Statements for information regarding the carrying value of non-

controlling interest in each subsidiary.

3. Includes “Dundee Securities Europe LLP”, “Dundee Securities Inc.”, and “Dundee Goodman Insurance Agency Ltd.”, all of which are sister companies to

Dundee Securities Ltd. “Dundee Capital Markets” and “Dundee Goodman Private Wealth” are divisions of Dundee Securities Ltd.

4. From time to time, the Corporation will advance monies to an operating subsidiary to fund working capital requirements. Amounts advanced between the

Corporation and its operating subsidiaries are eliminated in the September 2015 Interim Consolidated Financial Statements of the Corporation. Accordingly, for

purposes of determining the estimated market value of operating subsidiaries that are publicly traded, the Corporation has included its proportionate interest in

advances to each operating subsidiary that is due to the Corporation from non-controlling shareholders of each operating subsidiary. Amounts due under these

arrangements to operating subsidiaries that are not publicly traded are already included in the determination of the net carrying value of these operating

subsidiaries.

A description of each subsidiary, the nature of its business activities, and a discussion of its principal operating strategies were

provided in the Corporation’s MD&A for the year ended December 31, 2014 under “Business Strategies of Operating

Subsidiaries”. The following discussion provides an update on operating strategies of the Corporation’s operating subsidiaries

since December 31, 2014.

Wealth Management

In the latter part of 2014, the Corporation established Dundee Global Investment Management Inc. (“DGIM”) through which it

expects to build an ICPM platform. The wealth management business of DGIM currently encompasses the activities of two of

the Corporation’s subsidiaries, Goodman & Company, Investment Counsel Inc. (“GCIC”) and Dundee Securities Ltd.

Goodman & Company, Investment Counsel Inc.

GCIC is a registered portfolio manager and exempt market dealer across Canada and an investment fund manager in the

provinces of Ontario, Quebec and Newfoundland.

GCIC’s strategy is to acquire, develop and manage high quality assets and businesses that demonstrate an opportunity to achieve

sustained growth and high returns in core sectors. To achieve its strategy, GCIC undertakes classical merchant banking and

private equity opportunities. GCIC currently manages the Corporation’s third party AUM, including its tax sheltered, closed end

and alternative investment products.

As at September 30, 2015, the Corporation held a 100% interest in GCIC. Additional information about GCIC may be accessed

at www.goodmanandcompany.com.

Non- Carrying Market

(000's) Controlling Value Value

Ticker # of Shares Market Percentage Net Assets Interests as at as at

Symbol Held Price/Share Ownership (note 1) (note 2) September 30, 2015 September 30, 2015

Subsidiaries That Are Not Publicly Listed

United Hydrocarbon International Corp. 35% 226,970$ -$ 226,970$ 226,970$

Dundee Securities Ltd. (note 3) 100% 144,222 - 144,222 144,222

Blue Goose Capital Corp. 88% 71,410 (6,440) 64,970 64,970

Dundee 360 Real Estate Corporation 100% 75,643 (1,947) 73,696 73,696

AgriMarine Holdings Inc. 100% 22,902 - 22,902 22,902

Goodman & Company, Investment Counsel Inc. 100% 2,761 - 2,761 2,761

Subsidiaries That Are Publicly Listed

Dundee Sustainable Technologies Inc. DST 228,068.5 $0.08 66% 9,154 732 9,886 18,245

Dundee Energy Limited DEN 108,993.5 $0.03 58% 58,609 (23,314) 35,295 3,270

Eurogas International Inc. EI 16,646.8 $0.00 53% 319 1,870 2,189 83

Amounts due from non-controlling interests (note 4) - 6,437

TOTAL – OPERATING SUBSIDIARIES 582,891$ 563,556$

http://goodmanandcompany.com/


Dundee Securities Ltd.

Dundee Securities Ltd. is a full service investment dealer across Canada, offering a range of wealth management services for

individual retail investors under the name “Dundee Goodman Private Wealth” and a comprehensive range of services for

institutional investors under the name “Dundee Capital Markets”. As an investment dealer in each of the jurisdictions of Canada

and as a derivatives dealer in Quebec, Dundee Securities Ltd. is subject to the oversight of the provincial securities commissions

and the Investment Industry Regulatory Organization of Canada. Operations are carried out directly, and through several sister

companies including Dundee Securities Europe LLP, a company authorized by the Financial Services Authority in the United

Kingdom for the purposes of security brokering and asset management; and Dundee Goodman Insurance Agency Ltd., licensed

by the Financial Services Commission of Ontario to carry on business as a life insurance agency (collectively “Dundee

Securities”).

As at September 30, 2015, the Corporation held a 100% interest in Dundee Securities and its sister companies. Additional

information about the operations of Dundee Securities and its various business divisions may be accessed at either

www.dundeecapitalmarkets.com or www.dundeegoodmanprivatewealth.com.

Dundee Energy Limited

Dundee Energy Limited (“Dundee Energy”) is a small-cap Canadian-based company focused on creating long-term value

through the development and acquisition of high-impact energy projects. Dundee Energy currently produces approximately

2,500 boe/d, 77% of which is natural gas production. Primarily in response to the considerable decline and ongoing volatility in

the price of oil and natural gas, Dundee Energy has significantly deferred its capital expenditure program, allocating immediately

available resources to activities designed to maintain existing production. Any residual cash flows that result from the reduced

capital spending will be applied towards the repayment of outstanding debt.

At September 30, 2015, the Corporation held a 58% interest in Dundee Energy, a public company whose common shares are

traded on the TSX under the symbol “DEN”. Additional information about Dundee Energy may be accessed at www.dundee-

energy.com.

United Hydrocarbon International Corp.

United Hydrocarbon International Corp. (“UHIC”) is a privately-held Canadian company engaged in the exploration,

development and production of oil and gas in the Republic of Chad. UHIC has a Production Sharing Contract (“PSC”) with the

government of the Republic of Chad through its wholly-owned subsidiary, United Hydrocarbon Chad Ltd. The PSC provides

UHIC with the exclusive right to explore and develop oil and gas reserves in four distinct blocks: the DOC Block and the DOD

Block (together the “Doba Basin”); the Lake Chad Block; and the Largeau Block.

The Corporation had previously announced that it was seeking to raise third party debt or equity of up to $250 million, the

proceeds of which would be used by UHIC in connection with its ongoing exploration programs. The sharp decline in oil prices

in late 2014 and continuing through 2015, have reduced value, delayed negotiations to secure a partner, and do not currently

support the original carrying value of the Corporation’s resource properties associated with its investment in UHIC.

As a result, during the third quarter of 2015, the carrying value of these properties was impaired by $215.2 million. The resource

properties were measured based on fair value less costs of disposal, determined by applying comparable valuation metrics as

determined in capital markets to UHIC’s most recent prospective resource estimates. The valuation methodology applied is

sensitive to the response of capital markets to further volatility in the pricing outlook for oil, which may result in additional

impairments to the resource properties, or may also result in the reversal of such impairment if the underlying volatility and/or

the price of oil improves.

As at September 30, 2015, the Corporation held a 35% equity interest in UHIC and in addition, had advanced $311.6 million to

UHIC under debt arrangements, all of which is currently carried at a total amount of $227.0 million. Additional information

regarding UHIC may be accessed at www.unitedhydrocarbon.com.

http://dundeecapitalmarkets.com/

http://www.dundeecapitalmarkets.com/

http://www.dundeegoodmanprivatewealth.com/

http://www.dundee-energy.com/

http://www.dundee-energy.com/

http://www.unitedhydrocarbon.com/


Dundee Sustainable Technologies Inc.

Dundee Sustainable Technologies Inc. (“Dundee Technologies”) is engaged in the development of technologies for the treatment

of complex materials in the mining industry. Through the development of patented, proprietary processes, Dundee Technologies

extracts precious and base metals from ores, concentrates and tailings, while stabilizing contaminants such as arsenic, which

could not otherwise be extracted or stabilized with conventional processes because of metallurgical issues or environmental

considerations.

At present, Dundee Technologies’ most advanced proprietary processes are associated with the extraction of precious metals

using chlorination, which provides a cyanide-free alternative for the exploitation of gold deposits. In June 2015, Dundee

Technologies completed the construction of a demonstration plant that will serve as a “demonstration platform” for the

chlorination process on an industrial scale and under continuous operating conditions. Dundee Technologies has been supplied

with 600 tonnes of pyrite concentrate which it anticipates will be sufficient for processing during the first four month period of

operations at the demonstration plant. At full capacity, the demonstration plant should process approximately 5,000 tonnes of

concentrate per year.

In addition to this chlorination process, Dundee Technologies is currently in the construction phase of a pilot plant, designed to

analyze its arsenic stabilization process, which is designed for the sequestration of the contaminants into a stable glass form. This

process is becoming an attractive technique to segregate the arsenic and is therefore opening opportunities for materials

considered to contain too much of this toxic material to be exploited or stabilized using conventional approaches.

At September 30, 2015, the Corporation held a 66% equity interest and an 85% voting interest in Dundee Technologies.

Additional information regarding Dundee Technologies may be accessed at www.dundeetechnologies.com.

Eurogas International Inc.

Eurogas International Inc. (“Eurogas International”) (www.eurogasinternational.com), is a publicly traded (CSE:EI) oil and

natural gas exploration company. Eurogas International recently farmed out a substantial working interest in the Sfax offshore

permit, located in the shallow Mediterranean waters in the Gulf of Gabes, offshore Tunisia and southeast of the city of Sfax, to

DNO Tunisia AS, a subsidiary of DNO International ASA, an Oslo-listed company with significant expertise in the oil and gas

industry across the Middle East and Africa. Eurogas International has retained an approximate 5.625% royalty-like working

interest against future production derived from the Sfax offshore permit.

Blue Goose Capital Corp.

Blue Goose Capital Corp. (“Blue Goose”) is a privately-held Canadian company focused on the production, distribution and sale

of organic and natural beef, chicken and fish.

In late 2014, Dundee Corporation took steps to right size the business of Blue Goose. In early 2015, the Corporation appointed

new leadership to the operations of Blue Goose, with significant knowledge of the agriculture and agri-business industries in

Canada and abroad. Under this new leadership, Blue Goose’s focus in 2015 has been to profitably build the Blue Goose brand

and expand SKUs (stock keeping units) in each of the three protein verticals: organic beef, chicken and fish.

In addition to these intiatives, during the second quarter of 2015, Blue Goose successfully divested certain non-core assets,

including its aggregates business, and certain assets associated with its Wagyu cattle operations.

At September 30, 2015, the Corporation held an 88% interest in Blue Goose. Additional information about Blue Goose may be

accessed at www.bluegoosepurefoods.com.

http://www.dundeetechnologies.com/

http://www.bluegoosepurefoods.com/


AgriMarine Holdings Inc.

AgriMarine Holdings Inc. (“AgriMarine”) is a private company engaged in fish farming activities using both conventional

netting systems and other proprietary aquaculture technologies. AgriMarine has three principal assets: a Steelhead trout fish farm

known as West Coast Fishculture, located in Powell River, British Columbia; a suite of patents pertaining to a closed-

containment tank technology used to rear finfish; and an engineering company known as “AgriMarine Technologies” that

supports internal needs and provides engineering services to third-party fish farm operators.

Effective May 22, 2015, the Corporation acquired the remaining 5% interest in AgriMarine that it did not already own for $0.2

million. As a result of this going private transaction, AgriMarine became a private, wholly-owned subsidiary of Dundee

Corporation, and the common shares of AgriMarine were delisted from the Canadian Securities Exchange.

Additional information about AgriMarine may be accessed at www.agrimarine.com.

Dundee 360 Real Estate Corporation

Dundee 360 Real Estate Corporation (“Dundee 360”) is an integrated global real estate company with proven capabilities

supporting the execution of mixed-use real estate projects from inception to monetization. Three core areas are strategic to the

growth of Dundee 360, including i) real estate development; ii) residential sales and marketing; and iii) hospitality and asset

management activities.

Many of Dundee 360’s current projects are early in their lifecycles, including Parq Resort & Casino in British Columbia, and its

developments in France, Croatia, Cuba and Korea. All of these projects have the support of the required regulatory and

governmental agencies and are expected to provide long-term sustainable revenues to Dundee 360.

Going forward, Dundee 360’s growth strategy is two-fold: firstly, it plans to capitalize on the continued densification of core

downtown areas in major cities and on the dramatic expansion of the affluent and middle classes, which should both drive

investments in urban and recreational mixed-use developments and benefit Dundee 360’s three core businesses. Secondly, it

plans to leverage the reputation of its international work, its association with Mii amo Spa, as well as the Sotheby’s International

Realty network to identify key projects and optimal sources of capital, and to deliver best-in-class projects in the communities

within which it operates. Currently, Dundee 360 is aligning strategic and long-term capital sources and financing vehicles, such

as investment funds, to allow Dundee 360 to continue growing its core business areas and leverage the depth of its expertise.

SIGNIFICANT INVESTMENTS ACCOUNTED FOR UNDER THE EQUITY METHOD

Reclassifications of Investments from Equity Accounted Investments to Portfolio Investments

Dundee Precious Metals Inc. (“Dundee Precious”) (www.dundeeprecious.com) is a Canadian-based international mining

company engaged in the acquisition, exploration, development, mining and processing of precious and base metals in Bulgaria,

Namibia, Armenia and Serbia. Dundee Precious seeks to acquire, finance and develop low-cost, long-life mining properties. The

Corporation holds a 25% interest in Dundee Precious which it had accounted for on an equity basis. As a result of the

repositioning by the Corporation of certain members of its senior management, the Corporation no longer has representation on

the board of directors of Dundee Precious, nor does it have the contractual right to appoint representation to the board of directors

of Dundee Precious. As a consequence, during the second quarter of 2015, the Corporation determined that it was not capable of

exerting significant influence over Dundee Precious and accordingly, the Corporation’s investment in Dundee Precious was

reclassified and designated as an investment at fair value through profit or loss (“FVTPL”).

In August 2015, Oban Mining Corporation (“Oban”) completed a plan of arrangement pursuant to which Oban acquired all of

the common shares of each of Eagle Hill Exploration Corporation, Ryan Gold Corp. and Corona Gold Corporation in exchange

for the issuance of common shares of Oban from its treasury. The Corporation received 7,694,311 common shares of Oban on

the exchange, which the Corporation has classified as an investment at FVTPL. Prior to completion of the transaction with Oban

as outlined above, the Corporation had accounted for its investments in each of Eagle Hill Exploration Corporation, Ryan Gold

Corp. and Corona Gold Corporation on an equity basis.

http://www.agrimarine.com/

http://www.dundeeprecious.com/


Equity Accounted Investments at September 30, 2015

(i) The amount designated as the “market value” of privately held equity accounted investees is equal to their carrying value in the September 2015 Interim

Consolidated Financial Statements. The Corporation has not otherwise provided a valuation estimate of the market value of these investments.

(ii) The Corporation holds a 50% interest in Paragon Holdings (Smithe Street) ULC which holds a 74% interest in the Edgewater Casino Limited Partnership

giving the Corporation an effective 37% interest in the underlying project.

(iii) Dundee Energy Limited’s 74% owned subsidiary, Castor UGS Limited Partnership, holds a 33% interest in Escal giving Dundee Energy Limited an effective

25% interest and Dundee Corporation an effective 14% interest in Escal and its underlying projects.

Continuity in the Corporation’s Portfolio of Equity Accounted Investments

The following table provides a summary of the continuity of the Corporation’s portfolio of equity accounted investments during

the nine months ended September 30, 2015, including the reclassification of its investment in Dundee Precious, Eagle Hill

Exploration Corporation, Ryan Gold Corp. and Corona Gold Corporation.

Significant Developments in Equity Accounted Investments

Dundee Sarea Acquisition I Limited Partnership. (“Dundee Sarea”)

During the third quarter of 2015, Dundee Sarea (www.dundeesarea.com) received initial capital commitments of $112.5 million

to establish its initial special situations fund, the mandate of which is to invest in companies requiring turn-around expertise in

North American and Europe, with a focus on manufacturing, distribution, industrial products, agriculture, oil and gas and

forestry-related industries.

Dundee Corporation originally committed $37.5 million towards Dundee Sarea, of which $14.6 million had been invested on

September 30, 2015, originally representing 50% of the aggregate committed amount to the fund. On September 16, 2015, the

fund raised third party committed capital of a further $37.5 million, reducing the Corporation’s interest in the fund to

approximately 33%. In connection with the raising of third party capital, in October 2015, the Corporation received cash of $4.9

million as its pro-rata return of capital of the committed investment by the third party.

As at September 30, 2015 December 31, 2014

Trade Carrying Market Carrying Market

Symbol Investment Ownership Value Value (i) Ownership Value Value (i)

Publicly Listed Equity Accounted Investments

ODX Odyssey Resources Limited 31% 190$ 227$ 31% 234$ 341$

DPM Dundee Precious Metals Inc. n/a n/a n/a 25% 191,704 95,771

n/a Eagle Hill Exploration Corporation n/a n/a n/a 29% 2,810 2,810

n/a Ryan Gold Corp. n/a n/a n/a 20% 2,574 2,574

n/a Corona Gold Corporation n/a n/a n/a 24% 2,214 1,918

190 227 199,536 103,414

Privately Held Equity Accounted Investments

Paragon Holdings (Smithe Street) ULC (ii) 37% 56,068 56,068 50% 70,560 70,560

Union Group International Holdings Limited 40% 67,037 67,037 40% 52,018 52,018

Android Industries, LLC 20% 25,644 25,644 20% 21,847 21,847

Cambridge Medical Funding Group II, LLC 50% 11,517 11,517 50% 10,683 10,683

Dundee Sarea Acquisition I Limited Partnership 33% 10,345 10,345 50% 7,356 7,356

Dundee Acquisition Ltd. 98% (553) (553) n/a n/a n/a

Escal UGS S.L. (iii) 14% - - 14% - -

170,058 170,058 162,464 162,464

170,248$ 170,285$ 362,000$ 265,878$

For the nine months ended September 30, 2015

Carrying value of equity accounted investments, beginning of period 362,000$

Transactions during the nine months ended September 30, 2015

Share of loss from equity accounted investments (5,777)

Share of other comprehensive income from equity accounted investments 27,381

Cash invested in equity accounted investments 2,844

Transfer to investments at FVTPL (216,204)

Other 4

Carrying value of equity accounted investments, end of period 170,248$

http://www.dundeesarea.com/


During the nine months ended September 30, 2015, the Corporation’s share of equity earnings from its investment in Dundee

Sarea was $2.1 million, including the recognition of a dilution gain of $1.5 million relating to the committed capital of the new

third-party investor.

Dundee Acquisition Ltd. (“Dundee Acquisition”)

On March 5, 2015, the Corporation created Dundee Acquisition (www.dundeeacquisition.com), a special purpose acquisition

corporation (“SPAC”). A SPAC is a publicly traded corporation that has no operating business and uses the money raised from

the sale of equity in an initial public offering to finance an acquisition or merger of one or more businesses or assets by way of a

merger, share exchange, asset acquisition, share purchase, reorganization, or any other similar business combination (a

“Qualifying Acquisition”).

Dundee Corporation founded Dundee Acquisition with an initial subscription of class B common shares with a value of $25,000

or $0.008 per share. On April 21, 2015, Dundee Acquisition completed an initial public offering of its class A restricted voting

units at $10.00 per unit, each unit consisting of a class A restricted voting share, and one-half of a warrant, each whole warrant

entitling the holder to purchase an additional share of Dundee Acquisition at $11.50 per share, subject to certain conditions as

outlined in the prospectus supporting the initial public offering. Dundee Acquisition raised aggregate proceeds of $112.3 million

pursuant to the initial public offering, including proceeds received on the exercise of an over-allotment option granted to its

underwriters. In connection with the initial public offering and its role as sponsor of Dundee Acquisition, Dundee Corporation

acquired 430,750 additional class B common shares of Dundee Acquisition at $10.00 per unit.

At September 30, 2015, Dundee Acquisition had 14,575,937 shares outstanding, comprised of 11,230,000 class A restricted

voting shares and 3,345,937 class B common shares. Dundee Corporation held 3,272,677 class B common shares, representing

22% of the aggregate issued and outstanding shares of Dundee Acquisition. Accordingly, the Corporation is accounting for its

investment in Dundee Acquisition as an equity accounted investment.

The class A restricted voting shares of Dundee Acquisition provides the holders with the right to redeem their shares in the event

that a Qualifying Acquisition is not completed within 21 months from the closing of the initial public offering, or in certain other

conditions as outlined in the prospectus and, as such, the class A restricted voting shares of Dundee Acquisition have been

classified as debt in Dundee Acquisition’s financial statements. As a result, the equity of Dundee Acquisition consists solely of

its class B common shares, of which the Corporation holds 98%.

In connection with the initial public offering, Dundee Acquisition placed $10.00 per class A restricted voting share into an

escrow account to settle any redemption requirement. The Corporation, as founder and sponsor of Dundee Acquisition, does not

have access to these funds to fund ongoing operations, including legal and due diligence work necessary to complete a Qualifying

Acquisition. Dundee Corporation has also executed a make-whole agreement and undertaking in favour of Dundee Acquisition,

whereby Dundee Corporation has agreed to indemnify Dundee Acquisition in certain limited circumstances where the funds held

in escrow are reduced to below $10.00 per class A restricted voting share.

Since its creation, Dundee Acquisition has incurred costs, including costs associated with its initial public offering, such that at

September 30, 2015, Dundee Acquisition had a shareholders’ deficiency, of which the Corporation’s share is approximately $0.6

million. The Corporation has reduced its carrying value in this equity accounted investment to below zero to reflect its share of

the deficiency as it has certain legal obligations to make payments on behalf of the equity accounted investment, including any

payments required pursuant to the indemnity as outlined above.

Since its inception in March 2015 to September 30, 2015, the Corporation’s share of the net loss of Dundee Acquisition was $4.9

million.

Paragon Holdings (Smithe Street) ULC (“Paragon Holdings”)

Paragon Holdings is a joint venture established between the Corporation and Paragon Gaming Inc., for the purpose of developing

a Vancouver-based urban entertainment and leisure resort to be constructed adjacent to the B.C. Place stadium. The Corporation

holds an effective 37% indirect interest in the resort, including the existing operations of the Edgewater Casino.

http://www.dundeeacquisition.com/


Once completed, the resort will feature two luxury hotels, a 60,000 square foot conference centre, five restaurants, three lounges,

retail space, parking facilities and a new home for the existing Edgewater Casino. The Corporation and Paragon Gaming Inc.

have entered into certain contracts pursuant to which entities jointly controlled by Dundee 360 and Paragon Gaming Inc. will

assume responsibility for the development, construction and management of the new complex on a fee-for-service basis.

The resort has an estimated full build out cost of $630 million, including financing costs. In late 2014, Parq Holdings Limited

Partnership (“Parq”) completed a US$415 million project financing arrangement for the development of the project. EllisDon

Corporation and Tishman Construction Corporation are constructing the project pursuant to a guaranteed maximum price

construction contract. Construction of the project commenced in late 2014 and is expected to be completed at the end of 2016.

Currently, excavation for the underground parking garage and podium is complete with above grade work commencing in

October 2015. Certain components of the parking garage construction had been accelerated to facilitate site access, and

improving the construction timetable. All permitting and approvals continue to proceed according to schedule.

During the nine months ended September 30, 2015, the Corporation recognized equity losses from its investment in Paragon

Holdings of $14.5 million (nine months ended September 30, 2014 – $2.0 million). These losses mainly reflect the Corporation’s

share of unrealized foreign exchange losses related to the project’s U.S. dollar-denominated debt. Exposure to changes in foreign

exchange rates in the underlying project debt is mitigated as the debt terms established a 30-month interest reserve to June 2017

that required the deposit of U.S. currency. The project has implemented a progressive hedging strategy whereby it has entered

into cross currency swaps on its quarterly interest and principal payments to mitigate its exposure to interest rate and foreign

currency fluctuations to March 31, 2019. In addition, the project has also locked in approximately US$90.0 million of its

principal at 1.326 CAD to 1.00 USD until March 31, 2019. The project expects to be able to refinance all or a portion of its debt

on or before March 31, 2019. The project’s debt matures on December 17, 2020 and December 17, 2021. The project will

progressively enter into additional hedges if foreign exchange rates reach certain pre-determined thresholds.

Union Group International Holdings Limited (“Union Group”)

Union Group (www.uniongrp.com) is a holding company with strategic investments in the agriculture, power generation,

infrastructure and logistics, minerals, oil and gas, and real estate sectors, expanding across a select number of Latin American

countries such as Uruguay, Peru and Paraguay. Union Group currently oversees US$1.0 billion of tangible, inflation-protected

assets.

Since 2011, Union Group has been developing approximately 1,000 megawatts (“MW”) of new hydropower capacity in Peru,

distributed across a portfolio of more than 15 run-of-river projects at various stages of development. The fabrication of power

generation equipment, as well as the civil construction works to house the equipment for its first two hydro plants, El Carmen and

8 de Agosto (27 MW) have been completed and production is expected to commence in January 2016, adding over 200 GWh of

renewable energy per year to the national grid under a 20-year power purchase agreement with the Peruvian government. Earlier

in 2015, Union Group welcomed a European bank as strategic minority investor in these first two projects with an injection of

capital of US$25 million.

As part of its expansion plan to reach an installed capacity of 50 MW by the end of 2015, Union Group completed the acquisition

of Karpa, a hydro generation project of 20 MW of power, and with a 20-year power purchase agreement with the Peruvian

government. The Karpa project is scheduled to become operational by April 2017. Additionally, Union Group has developed

four other power generation projects that are now bidding for 20-year power purchase agreements with the government.

Union Group continues developing and operating infrastructure and logistics assets in Uruguay. Union Group operates a fleet of

six ships with a total capacity of 10,000 tonnes. A general cargo ship, with capacity for 262 teu’s (twenty-foot equivalent units)

or deadweight of 3,144 tonnes, covers a regular route between the Port of Paysandú, on the shores of the Uruguay River, and

Montevideo, with additional port calls in Nueva Palmira. Union Group also operates the Port of Paysandú, where it owns

specialized lifting equipment. For inland navigation, Union Group operates a fleet of four barges, with a capacity of 1,700 tonnes

each, and one pusher vessel that operates as a convoy.

http://www.uniongrp.com/


Union Group also develops and operates oil and gas assets in the Andean States and Southern Cone regions of Latin America.

During the first nine months of 2015, Union Group signed a joint venture agreement with ANCAP, thereby becoming the only

private company in Uruguay to operate jointly with Uruguay’s state-owned oil company. In addition, Union Group has

completed the acquisition of a controlling stake in an oil and gas operator/owner of a high potential onshore block in Peru with up

to 2.2 trillion cubic feet in reserves, and it has acquired a minority stake of a block in onshore Paraguay.

Union Group currently manages and invests in a diversified portfolio of prime real estate properties in Uruguay, including

income generating, residential and coastline land properties. It also holds a minority stake in Union Agriculture Group

(www.uag.com.uy) which currently manages 170,000 hectares of farmland and is a leading producer of dry crops, rice, cattle,

sheep and dairy products.

More recently, the Corporation and Union Group are collaborating on development of an asset management strategy and

innovative investment product offerings to allow third party investors to participate in the continued growth of Latin America’s

most compelling economies.

During the nine months ended September 30, 2015, Union Group incurred losses of approximately US$2.3 million (nine months

ended September 30, 2014 – US$1.4 million), primarily as a result of pre-operative expenses associated with an energy

generating business. The Corporation’s share of these losses was $1.2 million. The Corporation’s share of losses is offset by the

recognition of a $10.9 million dilution gain resulting from the US$25 million equity investment by the European bank as noted

above.

Android Industries, LLC (“Android”)

The Corporation holds a 20% interest in Android (www.android-ind.com), a private leading high technology-enabled assembler

and sequencer of complex assemblies for the automotive industry. During the nine months ended September 30, 2015, Android

successfully concluded negotiations with a significant Asian Original Equipment Manufacturer (“OEM”), landing an assembly

contract with this new customer. Android continues to make progress with other OEM negotiations and its continued expansion

in the automotive industry both in and outside North America.

During the nine months ended September 30, 2015, Android reported earnings before interest expense, and members’ distribution

for income taxes, of US$19.3 million. The Corporation’s share of equity earnings from its investment in Android was $1.6

million (nine months ended September 30, 2014 – $0.7 million equity loss).

Cambridge Medical Funding Group II, LLC (“Cambridge Medical”)

Cambridge Medical is a private, U.S.-based consortium with a focus on purchasing insured medical receivables. Using

proprietary software and sourcing, Cambridge Medical purchases medical receivables from clinics servicing Workers’

Compensation claims and manages the collection and adjudication process. Cambridge Medical continues to grow its business

organically and is seeing the benefits of improved efficiencies and business intelligence made possible through their proprietary

Rete software program. The Corporation has invested US$10.0 million to acquire a 50% interest in Cambridge Medical. The

Corporation has also advanced a further US$1.0 million to Cambridge Medical to assist with short-term working capital

requirements as Cambridge Medical expands its base of medical claims.

During the nine months ended September 30, 2015, the Corporation’s share of equity earnings from its investment in Cambridge

Medical was $0.1 million (nine months ended September 30, 2014 – $0.5 million equity loss).

Escal UGS S.L. (“Escal”)

Escal was the developer and owner of a Spanish infrastructure project that converted the abandoned Amposta oilfield, located off

the eastern Mediterranean coast of Spain, to a natural gas storage facility (the “Castor Project”). The construction and

development of the Castor Project was managed through ACS Servicios Comunicaciones y Energia S.L. (“ACS”), a construction

group in Spain and a 67% shareholder of Escal. Through its 74% owned subsidiary, Castor UGS Limited Partnership (“CLP”),

Dundee Energy is the owner of the remaining 33% interest in Escal, providing Dundee Corporation with an indirect 14% interest

in the Castor Project.

http://www.android-ind.com/


In September 2013, the Spanish authorities mandated suspension of activities, following micro-seismic activity detected in the

area surrounding the Castor Project and Escal determined that it was appropriate to exercise its right under the underground gas

storage concession to relinquish the concession to the Spanish authorities. In November 2014, and under the terms of the

relinquishment, Escal received €1.35 billion, being the net value of its investment in the Castor Project, after deducting €110

million previously received by Escal during the pre-commissioning stage of development. These proceeds were applied towards

the partial repayment of the €1.41 billion of outstanding bonds issued by Watercraft Capital S.A., Escal's financing vehicle.

Also in November 2014, ACS arranged a €300 million bank financing for Escal, of which €60 million was applied to repay the

balance of amounts owing pursuant to the outstanding bond arrangements. CLP is of the view that the new financing arranged by

ACS was not in the best interest of Escal and consequently, CLP has lodged a legal action challenging the approval of the new

financing. The balance of the funds were used to repay Escal’s shareholder loans solely to ACS, which in the opinion of CLP,

contravenes the terms of the 2007 memorandum of understanding in respect of CLP’s ownership rights in the equity and

shareholder loans of Escal. Early in the second quarter of 2015, CLP commenced binding arbitration proceedings to resolve this

contractual dispute with ACS. As required pursuant to the terms of the memorandum of understanding referred to above, the

arbitration will be in accordance with the rules of the International Chamber of Commerce (“ICC”) in Paris, and will be heard by

an arbitral tribunal consisting of three arbitrators. CLP has initiated the assembly of the necessary documents in support of its

claim for eventual transmission to the court. Evidentiary hearings are expected to commence in mid-2016. In order to fund the

costs associated with the arbitration process, CLP raised funds through a voluntary cash call to its limited partners. CLP raised

cash of $2.2 million from the cash call, including $1.7 million raised from Dundee Energy itself.

The Spanish authorities have mandated that the Castor Project remain mothballed until the Spanish government is satisfied with

technical studies and reports on any future commissioning of such facilities. However, Escal and its shareholders remain

responsible for any possible flaws or defects in the facilities associated with the Castor Project that become apparent during a 10

year period ending in October 2024.

Earnings and Losses from Equity Accounted Investments

For the nine months ended September 30, 2015 2014

Equity Equity Dilution

Earnings Dilution Earnings Gains

(Losses) Gains Total (Losses) (Losses) Total

Dundee Precious Metals Inc. 175$ 187$ 362$ (21,652)$ (648)$ (22,300)$

Paragon Holdings (Smithe Street) ULC (14,492) - (14,492) (2,007) - (2,007)

Union Group International Holdings Limited (1,153) 10,888 9,735 (650) - (650)

Android Industries, LLC 1,622 - 1,622 (688) - (688)

Cambridge Medical Funding Group II, LLC (63) 92 29 (507) - (507)

Dundee Sarea Acquisition I Limited Partnership 540 1,545 2,085 - - -

Dundee Acquisition Ltd. (5,756) 871 (4,885) - - -

Others (278) 45 (233) (1,995) 959 (1,036)

(19,405) 13,628 (5,777) (27,499) 311 (27,188)

Real estate joint venture investments 143 - 143 87 - 87

(19,262)$ 13,628$ (5,634)$ (27,412)$ 311$ (27,101)$

For the three months ended September 30, 2015 2014

Equity Equity Dilution

Earnings Dilution Earnings Gains

(Losses) Gains Total (Losses) (Losses) Total

Dundee Precious Metals Inc. -$ -$ -$ (2,708)$ 60$ (2,648)$

Paragon Holdings (Smithe Street) ULC (8,415) - (8,415) (1,912) - (1,912)

Union Group International Holdings Limited (347) - (347) 158 - 158

Android Industries, LLC (4) - (4) 1,063 - 1,063

Cambridge Medical Funding Group II, LLC (260) - (260) (202) - (202)

Dundee Sarea Acquisition I Limited Partnership 616 575 1,191 - - -

Dundee Acquisition Ltd. 326 1 327 - - -

Others (11) - (11) (1,142) (185) (1,327)

(8,095) 576 (7,519) (4,743) (125) (4,868)

Real estate joint venture investments 161 - 161 87 - 87

(7,934)$ 576$ (7,358)$ (4,656)$ (125)$ (4,781)$


In addition to its share of earnings of its equity accounted investments, during the nine months ended September 30, 2015, the

Corporation recognized $27.4 million in comprehensive income relating to these investments, primarily reflecting cumulative

foreign exchange translation gains related to equity accounted investees whose financial information is denominated in U.S.

currency.

OTHER PORTFOLIO INVESTMENTS

Portfolio of Investments at September 30, 2015

1. These investments are not traded on a prescribed exchange, therefore, market values of these investments were determined by application of valuation

methodologies appropriate for such investments.

At September 30, 2015, the estimated market value of the Corporation’s portfolio of investments carried at FVTPL was $479.8

million, a decrease of $173.9 million from an estimated market value of these investments of $653.7 million at December 31,

2014.

(000's) Per Market Value

Ticker # of Shares Share as at

Ownership Symbol Held Price September 30, 2015

Publicly Traded Securities

DREAM Unlimited Corporation 29% DRM 21,636.3 $7.03 152,103$

Dundee Precious Metals Inc. 25% DPM 35,470.8 $2.17 76,972

Newfoundland Capital Corporation 6% NCC/A 1,268.8 $10.78 13,678

Oban Mining Corporation 14% OBM 7,694.3 $1.20 9,233

Skyline International Development Inc. 7% SKLN 1,122.3 $7.22 8,108

Others 50,215

310,309

Private Investments (note 1)

TauRx Pharmaceuticals Ltd. 5% 67,975

Pan African Minerals Limited 12% 6,965

Red Leaf Resources Inc. 2% 16,362

Others 34,951

126,253

Mutual Funds and Other Short Term Investments

DMP Resource Class 8.6 $5.84 50

50

Debt Securities

Publicly Traded Debt Securities 8,131

Debt Securities Owing from Public Enterprises (note 1)

Almonty Industries Inc. - promissory note 4,000

Gran Colombia Gold Corp - secured gold linked notes 1,072

Others 1,223

Debt Securities Owing from Private Enterprises (note 1) 28,529

42,955

Warrants and Options (note 1)

Warrants or options on shares of publicly listed enterprises 235

235

TOTAL – PORTFOLIO INVESTMENTS 479,802$

For the three months ended For the nine months ended

September 30, 2015 September 30, 2015

Market value of portfolio investments, beginning of period 571,983$ 653,696$

Transactions during the period ended September 30, 2015

New investments 3,852 9,784

Proceeds from sales of investments (13,561) (162,563)

Changes in market values

Dundee Precious Metals Inc. (12,769) (134,212)

DREAM Unlimited Corporation (57,552) (54,956)

Others (20,344) (52,642)

Transfer from equity accounted investments 5,044 216,204

Other transactions 3,149 4,491

Market value of portfolio investments, end of period 479,802$ 479,802$


During the nine months ended September 30, 2015, the Corporation raised proceeds of $162.6 million from the sale of certain of

its investments. Proceeds include $58.9 million received from the settlement of a previously issued demand note to DREAM

Unlimited Corp., and a further $31.0 million from the repayment of amounts previously provided to DREAM Global Real Estate

Investment Trust. Additional proceeds of $26.0 million were realized on the sale of the Corporation’s interest in Catalyst Fund

Limited Partnership III during the second quarter of the current year.

Changes in the market value of investments further reduced the value of the Corporation’s portfolio of investments at FVTPL by

$241.8 million, reflecting decreases in market values, primarily resulting from the weakening demand for resources, as well as

declining commodities prices. Included in the change in market values during the nine months ended September 30, 2015 is

$134.2 million relating to the Corporation’s investment in Dundee Precious, which had previously been accounted for as an

equity accounted investment, and $55.0 million relating to the Corporation’s investment in DREAM Unlimited Corp.

At September 30, 2015, the Corporation’s portfolio of investments continued to include several public and private investments, as

well as certain debt securities across a variety of industry sectors.

Investment in DREAM Unlimited Corporation (“DREAM”)

In January 2015, DREAM (TSX:DRM) announced an agreement to form a joint venture with Canadian Pacific Railways (“CP”)

for the purpose of generating value from CP’s diverse portfolio of surplus real estate assets. Leveraging its experience and

recognized sector expertise, DREAM will identify and develop surplus assets from CP’s real estate portfolio including select

properties poised for development such as Schiller Park, a 75-acre site in Chicago; Obico, a 74-acre site near Toronto; South

Edmonton Yard, a 92-acre site close to downtown Edmonton; and Lucien L’Allier, a 3-acre site in downtown Montreal.

In addition, in March 2015, DREAM announced a reorganization of the management structure of DREAM Office Real Estate

Investment Trust (the “Office REIT”). Under the terms of the reorganization, the asset management agreement between

DREAM and the Office REIT was eliminated. In exchange, DREAM received 4.9 million limited partnership units of a

subsidiary of the Office REIT, each partnership unit of which is exchangeable for Office REIT units on a one-for-one basis.

Concurrent with the reorganization, DREAM and the Office REIT entered into a management services agreement pursuant to

which DREAM will continue to provide, on a cost recovery basis, strategic oversight of the Office REIT.

Real Estate -$168.1

35%

Mining - $153.0 32%

Pharmaceuticals -$68.2 14%

Energy - $46.2 10%

Financial - $24.7 5%

Agriculture - $5.1 1%

Other - $14.5 3%

Investments by Industry Sector at Market Value ($ Millions)as at September 30, 2015

Real Estate - $168.1

Mining - $153.0

Pharmaceuticals - $68.2

Energy - $46.2

Financial - $24.7

Agriculture - $5.1

Other - $14.5


Dundee Corporation currently holds a 29% equity stake with a market value of $152.1 million in DREAM. Additional

information regarding DREAM is available at www.dream.ca.

Dundee Precious Metals Inc.

Dundee Corporation currently holds a 25% equity stake with a market value of $77.0 million in Dundee Precious. As previously

indicated, the Corporation determined during the second quarter of 2015 that it no longer exerted significant influence over the

operations and financial results of Dundee Precious, and therefore reclassified and designated its interest in Dundee Precious as

an investment at FVTPL.

Investment in TauRx Pharmaceuticals Ltd. (“TauRx”)

TauRx is a private neuroscience company focused on the discovery, development and commercialization of products for the

diagnosis and treatment of neuro-degenerative diseases caused through protein aggregation. The business was established in

2002 with the aim of discovering novel approaches to the treatment and diagnosis of Alzheimer’s Disease (“AD”) as well as

other neurological diseases characterized by abnormal aggregation of the Tau protein within the brain.

TauRx is currently undertaking a substantial Phase 3 clinical trial program using LTMX™, a drug targeted at treatment of mild to

moderate AD and Frontotemporal Dementia. The Phase 2 clinical trial, completed using LTMX™’s predecessor drug (MTC™),

was conducted in over 300 patients and, according to the company, showed a 90% reduction in the rate of disease progression in

its first year and provided strong evidence that this approach to treatment may be capable of arresting the progression of the

disease over one to two years in those with mild AD. The active ingredient was reformulated to its current form in order to

address dose-dependent absorption limitations found with MTC™.

Subsequent to September 30, 2015, TauRx announced completion of the final tranche of a US$135.0 million equity financing

that it launched in March 2015. The funds will support ongoing Phase 3 trials to validate the efficacy of LMTX™. TauRx

expects the results of these clinical trials to be released in the middle of 2016.

Additional information regarding TauRx may be accessed at www.taurx.com.

Investment in Pan African Minerals (“Pan African”)

Pan African is a privately held, mineral exploration and development company focused on the acquisition, exploration and

development of mineral assets in western Africa. Pan African’s principal assets currently comprise the 90%-owned Tambao

manganese project in Burkina Faso and the 70%-owned Mount Klahoyo magnetite iron ore project in Ivory Coast. Pan African

also has uranium exploration licenses in Niger.

More recently, political unrest in Burkino Faso has caused delays in the production ramp up schedule. In March 2015,

production was temporarily suspended while Burkina Faso’s transitional government reviews the terms and conditions pursuant

to which the original permit was awarded under the previous government. As at September 30, 2015, the governmental review

was still ongoing and the license remained suspended.

Dundee Corporation currently owns 12% or a $7.0 million equity stake of Pan African. Additional information regarding Pan

African may be accessed at www.panafricanmineralssa.com.

http://www.dream.ca/

http://www.taurx.com/

http://www.panafricanmineralssa.com/


Investment in Red Leaf Resources Inc. (“Red Leaf”)

Red Leaf is a privately held oil and gas technology company. Red Leaf’s patented technology, EcoShale, is a next generation oil

and gas recovery technology focused on unlocking oil reserves in oil shale deposits. EcoShale extracts oil with lower energy

consumption, lower emissions and lower water utilization than any oil shale technology currently deployed in the world. The

addressable market for EcoShale is quite extensive; globally there are approximately 5.2 trillion barrels of oil shale in place

resources, with 4.2 trillion barrels of those resources in the United States alone.

In March 2015, Red Leaf announced the suspension of the Early Production System (“EPS”), the first commercial demonstration

project of the EcoShale technology, for up to two years. In part, this decision was a result of the low oil price environment, but it

will also provide Red Leaf time to improve the technology with a view to increase product yield and reduce costs, both leading to

an improvement in commerciality. Construction will restart in the first half of 2017 with first oil expected in 2018. Red Leaf’s

joint venture partner, Total E&P USA Oil Shale, LLC, will fund costs associated with the two-year suspension of the EPS phase

and the optimization of the EcoShale technology.

Dundee Corporation currently holds 2% or a $16.4 million equity stake in Red Leaf. Additional information regarding Red Leaf

may be accessed at www.redleafinc.com.

PERFORMANCE MEASURES

The Corporation believes that important measures of its operating performance, as well as that of its subsidiaries, include certain

metrics that are not defined under IFRS and as such, may not be comparable to similar performance measures used by other

companies. Throughout this MD&A, there will be references to certain performance measures which management believes are

relevant in assessing the economics of its business. While these performance measures are not formally recognized by IFRS, the

Corporation believes that they are informative and provide further qualitative insight into net earnings and cash flows.

“AUA” or “Assets under Administration” represent the approximate period-end value of client assets administered by the

Corporation’s brokerage subsidiaries and in respect of which these subsidiaries earn commission revenue and other similar

fees from clients. AUA are not included in the Corporation’s consolidated statements of financial position.

“AUM” or “Assets under Management” represent the period-end value of client assets managed by the Corporation’s

wealth management and asset management subsidiaries on a discretionary basis and in respect of which these subsidiaries

earn management fee revenue and, in certain cases, performance fee revenue. AUM are not included in the Corporation’s

consolidated statements of financial position.

“Barrel of Oil Equivalent” or “boe” is calculated at a barrel of oil conversion ratio of six thousand cubic feet (“Mcf”) of

natural gas to one barrel (“bbl”) of oil (6 Mcf to 1 bbl), based on an energy equivalency conversion method which is

primarily applicable at the burner tip and does not always represent a value equivalency at the wellhead.

“Contribution Margin” or “Margin” is an important measure of earnings in certain business segments and generally

represents core revenues less cost of sales. Margin generally excludes general and administrative expenses, interest

expense, and income taxes and may also exclude depreciation and depletion of assets not directly associated with the

activities of producing or extracting product for sale.

“Market Value” or “Fair Value” of an investment is generally determined using quoted market prices on prescribed stock

exchanges for investments that are publicly traded. Market value or fair value of an investment that is privately held is

determined by reference to valuation methodologies appropriate for the investment.

“Field Level Cash Flows” are calculated as revenue from oil and natural gas sales, less royalties and cost of sales. Field

level cash flows contribute to working capital, including debt management, as well as to the funding of capital expenditure

requirements for the Corporation’s resource-based business activities.

http://www.redleafinc.com/


“Field Netbacks” refer to field level cash flows expressed on a measurement unit or barrel of oil equivalent basis.

“Per Day Amount” or (“/d”) is used throughout this MD&A to reflect oil and gas production volumes on an average per

day basis.

“Probable Reserves” are those additional reserves that are less certain to be recovered than proved reserves. It is equally

likely that the actual remaining reserves quantities recovered will be greater or less than the sum of the estimated proved

plus probable reserves.

“Proved Reserves” are those reserves that can be estimated with a high degree of certainty to be recoverable. It is likely

that the actual remaining reserves quantities recovered will exceed the estimated proved reserves.

“Resources” or “Contingent Resources” represents those quantities of oil or natural gas estimated to be potentially

recoverable from known accumulations using established technology or technology under development, but which do not

currently qualify as reserves or commercially recoverable due to one or more contingencies.

“Shareholders’ Equity on a Per Share Basis” is calculated by dividing the carrying value of the Corporation’s

shareholders’ equity in accordance with IFRS (or the “Market Value” or “Fair Value” of such shareholders’ equity

determined using valuation methodologies as described under the definition of “Market Value” or “Fair Value” above), by

the aggregate number of Subordinate Shares and Class B Shares of the Corporation issued and outstanding.


RESULTS OF OPERATIONS

Nine months ended September 30, 2015 compared with the nine months ended September 30, 2014

Consolidated Net Earnings

During the nine months ended September 30, 2015, the Corporation incurred a net loss attributable to owners of Dundee

Corporation of $404.2 million, or a loss of $7.03 per share. Included in the current period results is an impairment of $132.9

million relating to the Corporation’s investment in UHIC, net of the non-controlling shareholders’ share of the associated

impairment in the underlying asset.

The net loss attributable to owners of Dundee Corporation, adjusted for the impairment to the Corporation’s investment in UHIC,

was $271.2 million or a loss of $4.74 per share. This compares with a net loss of $140.2 million, or a loss of $2.68 per share

incurred during the first nine months of the prior year. The following table summarizes the Corporation’s net earnings or loss on

a per segment basis, including the consequential effect of the impairment described above.

Other significant changes in period-over-period results are described below and are further discussed under “Segmented Results

of Operations”.

Included in the corporate and other portfolio holdings segment are gains or losses representing changes in the market

values of the Corporation’s investment portfolio, all of which have been classified as investments at FVTPL for

accounting purposes. Accordingly, changes in the fair value of these investments, which are determined by trends and

information in equity and capital markets, are recorded in the Corporation’s net earnings or loss and can cause

substantial volatility in operating results. However, the Corporation cautions that equity and credit markets do not

necessarily correctly reflect the underlying value of certain assets and therefore, the Corporation’s operating results do

not provide reliable predictive information to readers of the Corporation’s financial statements.


Before Impairment Impairment Total Total

Net earnings (loss) before income taxes from:

Goodman & Company, Investment Counsel Inc. (2,108) - (2,108) (1,101)

Dundee Securities Ltd. (14,431) - (14,431) (5,825)

Dundee Energy Limited (6,579) - (6,579) 3,764

United Hydrocarbon International Corp. (31,401) (215,156) (246,557) (24,486)

Dundee Sustainable Technologies Inc. (4,714) - (4,714) (7,064)

Eurogas International Inc. (571) - (571) (800)

Blue Goose Capital Corp. (13,688) - (13,688) (21,263)

AgriMarine Holdings Inc. (22,029) - (22,029) (2,671)

Dundee 360 Real Estate Corporation (11,728) - (11,728) (3,023)

(107,249) (215,156) (322,405) (62,469)

Adjusted for the corporation and portfolio segment:

Changes in the market value of investments:

Dundee Precious Metals Inc. (134,212) - (134,212) -

DREAM Unlimited Corporation (54,956) - (54,956) (22,300)

Other portfolio investments (52,642) - (52,642) (86,089)

Share of loss from equity accounted investment (5,634) - (5,634) (27,101)

Other items in the corporate and portfolio segment (16,764) - (16,764) 27,364

Income tax recovery 73,331 - 73,331 16,329

Net loss for the period (298,126)$ (215,156)$ (513,282)$ (154,266)$

Net loss attributable to:

Owners of the parent (271,242)$ (132,948)$ (404,190)$ (140,196)$

Non-controlling interest (26,884) (82,208) (109,092) (14,070)

(298,126)$ (215,156)$ (513,282)$ (154,266)$


Declines in the fair value of the Corporation’s portfolio of investments during the nine months ended September 30,

2015 were $241.8 million, compared with declines of $108.4 million incurred during the first nine months of the prior

year, including a marked-to-market loss of $134.2 million in respect of the Corporation’s investment in Dundee

Precious and $55.0 million relating to the Corporation’s investment in DREAM.

The Corporation’s stock based compensation expense is partially correlated to the market value of the Corporation’s

investment in DREAM. These stock based compensation arrangements are recognized as liabilities of the Corporation

and are measured at fair value as determined by the underlying price of a DREAM share, with changes in fair value

reported in net earnings. During the first nine months of the prior year, the value of these liabilities decreased by $9.7

million, with a corresponding decrease in stock based compensation expense. In addition to the effect of stock based

compensation, the Corporation also adjusted its estimate of incentive compensation. This adjustment further reduced

liabilities in the first nine months of the prior year by $6.0 million, with a corresponding reduction in general and

administrative expenses. On a combined basis, these compensation related amounts reduced aggregate expenses in the

first nine months of 2014 by $15.7 million, significantly affecting the comparative period-over-period results of the

corporate and other portfolio holdings segment.

Dundee Securities incurred net operating losses of $14.4 million during the first nine months of 2015, compared with

net operating losses of $5.8 million during the first nine months of the prior year. The increase in operating losses

relates primarily to the capital markets division of Dundee Securities, where challenging investment markets during the

first nine months of 2015 resulted in lower investment banking revenue, and correspondingly lower profitability.

Dundee Energy’s results were impacted by significant volatility in prices of oil and natural gas. During the first nine

months of the prior year and in response to unanticipated demand for natural gas due to poor weather conditions,

Dundee Energy realized an average price of $7.29/Mcf for its natural gas, compared with an average realized price of

$4.30/Mcf during the first nine months of 2015. Global prices for oil also adversely affected profitability in Dundee

Energy, as the realized price decreased to $62.78/bbl during the first three quarters of 2015, compared with $105.90/bbl

in the same period of the prior year.

UHIC incurred net operating losses, exclusive of the impairment loss related to its resource properties as previously

described, of $31.4 million during the first nine months of 2015, compared with losses of $24.5 million incurred during

the same period of the prior year. Results in the current period include $10.1 million of termination and shut-down

costs incurred by UHIC in response to lower oil prices, while prior year results included a $9.0 million compensation

amount related to the acceleration of the vesting criteria associated with outstanding warrants of UHIC. Ongoing costs

associated with the care and maintenance of UHIC’s resource properties are currently being expensed as general and

administrative costs and will not be allocated to the underlying cost of the property until active exploration is resumed.

In the early part of 2014, the Corporation restructured the operations of Blue Goose. As a result of these initiatives,

Blue Goose incurred a net operating loss of $21.3 million in the first nine months of the prior year. The steps initiated

to right size the business of Blue Goose, and the appointment of new leadership with significant knowledge of the

agricultural and agri-business industry, are beginning to be reflected in the net operating results of Blue Goose, with a

substantial reduction of losses in the current period, to $13.7 million.

Included in operating results during the first nine months of the current year are net losses of $33.8 million relating to

the operations of Dundee 360 and AgriMarine. The Corporation began to consolidate the operating results of Dundee

360 and AgriMarine in the third quarter of 2014, following its initial acquisition of control of these two entities in July

2014. The comparative losses recognized by the Corporation during the first nine months of the prior year include

losses only since the date of acquisition of control, and are therefore comparatively lower than the current period

results. Furthermore, operating results of AgriMarine during the first nine months of the current year include $18.1

million of accelerated depreciation on certain assets, including $13.6 million relating to intangible assets that were

acquired as part of the aforementioned acquisition of control.


Segmented Results of Operations

The following discussion provides a more comprehensive analysis of the performance results of each of the Corporation’s

operating subsidiaries, and their impact to the consolidated operating results of the Corporation. The following information is

presented in a manner that corresponds to the Corporation’s reportable business segments as presented in note 34 to the

September 2015 Interim Consolidated Financial Statements.

GOODMAN & COMPANY, INVESTMENT COUNSEL INC.

At September 30, 2015, total AUM in GCIC decreased to $91.3 million, compared with AUM of $104.1 million at December 31,

2014.

AUM depreciated by $9.5 million during the nine months ended September 30, 2015, representing approximately 9% of the

value of AUM at the beginning of the year. Depreciation experienced in AUM was much less than the depreciation in the

industry generally, including the S&P/TSX Composite Gold Sub-Industry Index, which declined by 17% during the nine months

ended September 30, 2015 and the S&P/TSX Composite Diversified Metals and Mining Sub-Industry Index which decreased by

over 52% in the same period. The indices used are a barometer of the Canadian resource industries, which is the investment

focus of the underlying funds managed by GCIC.

GCIC’s management fee revenue is determined based on the fair value of AUM calculated on the last business day of each

month. Average AUM was $105.4 million during the nine months ended September 30, 2015, compared with $281.9 million

during the same period of the prior year. The decrease in average AUM is reflected in management fee revenues, which

decreased to $1.5 million in the nine months ended September 30, 2015, compared with $2.4 million earned in the same period of

the prior year. During the nine months ended September 30, 2015, the average management fee rate increased to 2.0% of AUM,

compared with a 1.2% average management fee rate earned in the same period of the prior year, primarily as a result of GCIC’s

changed mandate and subsequent resignation from its sub-advisory arrangements. During the nine months ended September 30,

2015, GCIC incurred a net loss before income taxes of $2.1 million, compared with a loss of $1.1 million incurred in the same

period of the prior year. The increased loss reflects costs associated with the build-out of this entity to meet the strategic

direction undertaken by DGIM.

Management fee revenue earned by GCIC during the third quarter of 2015 was $0.5 million, compared with $0.8 million earned

in the same period of the prior year. Consistent with year-to-date results, the decrease reflects the reduction in underlying AUM,

partially offset by increased average management fee rate as a result of the realignment of sub-advisory activities. During the

third quarter of 2015, GCIC incurred a net loss of $0.9 million, compared with a net loss in the third quarter of 2014 of $0.2

million.


AUM at beginning of the period 104,110$


Additions 60,138

Redemptions (19,174)

Rollover of limited partnership units to mutual funds (40,804)

Distributions paid (3,395)

Trust units repurchased under market purchase program (30)

Change in market values (9,503)

Net change in managed assets (12,768)

AUM at end of the period 91,342$

AUM Breakdown

Tax sheltered investment products 31,409$

Closed end funds 28,678

Mutual funds 19,984

Alternative investment products 11,271

91,342$


DUNDEE SECURITIES LTD.


The Capital Markets Division

Financial Services Revenue

Investment banking revenue, including revenue from new issues and advisory services fees, was $20.3 million during the first

nine months of 2015, a 49% decrease from the $40.1 million of revenue earned in the same period of the prior year.

During the nine months ended September 30, 2015, Dundee Securities participated in 101 public and private new issue

transactions, marginally less than the 106 transactions in which Dundee Securities participated during the first nine months of the

prior year. The mining, oil and gas sectors represented 34% of new issue activity. New issue financings generated revenue of

$17.0 million during the first nine months of 2015, a decrease of 44% when compared with $30.5 million of revenue earned in

the same period of the prior year, as a consequence of both a decrease in the average size of financing transactions completed, as

well as lower average percentage participation in those financings by Dundee Securities.

Advisory fee revenue during the nine months ended September 30, 2015 was $3.3 million, compared with $9.6 million of

advisory fee revenue earned in the same period of the prior year. Advisory mandates are generally long term in nature, and fees

are earned only following the successful completion of a transaction, therefore, revenue from the provision of advisory fee

services may be subject to significant volatility.

In line with wider industry trends, commission revenue decreased by 31% during the first nine months of 2015 to $13.5 million,

compared with $19.5 million earned in the same period of the prior year, reflecting decreased activity from institutional clients.

A decrease in facilitation trading losses, compared with the same period of the prior year, has resulted in lower principal trading

losses of $2.6 million during the first nine months of 2015, compared with $4.5 million in the same period of the prior year. The

ratio of facilitation trading losses to associated institutional commission revenue decreased to 22% in the current period,

compared with 26% in the first nine months of the prior year.

For the nine months ended September 30, 2015 2014 2015 2014 2015 2014

Revenues

Management fees -$ -$ 12,472$ 9,906$ 12,472$ 9,906$

Financial services

Investment banking 20,267 40,084 - - 20,267 40,084

Commissions 13,507 19,537 17,560 17,167 31,067 36,704

Principal trading (2,573) (4,457) 1,384 3,573 (1,189) (884)

Foreign exchange trading - - 524 584 524 584

Interest, dividends and other 939 811 7,226 6,159 8,165 6,970

32,140 55,975 39,166 37,389 71,306 93,364

Cost of sales

Variable compensation (15,583) (28,557) (18,793) (17,804) (34,376) (46,361)

Other items in net earnings

Depreciation (325) (384) (1,383) (850) (1,708) (1,234)

General and administrative

- direct (18,529) (19,699) (18,141) (16,010) (36,670) (35,709)

- allocated (3,729) (5,394) (9,617) (10,422) (13,346) (15,816)

Interest expense (56) (47) (66) (78) (122) (125)

Foreign exchange gain (loss) 82 (8) 403 64 485 56

Net (loss) earnings before taxes, Dundee Securities (6,000)$ 1,886$ (8,431)$ (7,711)$ (14,431)$ (5,825)$

Net (loss) earnings before taxes, Dundee Securities attributable to:

Owners of Dundee Corporation (6,000)$ 1,886$ (8,431)$ (7,711)$ (14,431)$ (5,825)$

Non-controlling interest - - - - - -

Net (loss) earnings before taxes, Dundee Securities (6,000)$ 1,886$ (8,431)$ (7,711)$ (14,431)$ (5,825)$

Capital Markets Retail & Other TOTAL


Variable Compensation Expense

During the nine months ended September 30, 2015, variable compensation expense in the capital markets division was $15.6

million (nine months ended September 30, 2014 – $28.6 million), representing approximately 48% (nine months ended

September 30, 2014 – 51%) of related financial services revenue, resulting in contribution margins of 52% (nine months ended

September 30, 2014 – 49%). Contribution margins in the prior year were adversely affected by discretionary compensation

amounts that were not directly attributable to specific revenue items.

General and Administrative Expenses

The capital markets division incurred direct general and administrative expenses of $18.5 million during the first nine months of

2015, compared with $19.7 million incurred in the same period of the prior year, due to a reduction in trade related, promotion

and travel expenses, partially offset by severance costs associated with the restructuring of the division. Allocated expenses

decreased to $3.7 million from $5.4 million in the same period of the prior year, due primarily to expense reductions in back

office administration and support departments.

The Retail Division and Other Activities

Assets Under Management and Assets Under Administration

AUA decreased to $4.3 billion at September 30, 2015, compared with AUA levels of $4.8 billion at the end of December 2014

and September 30, 2014. AUM also decreased during the same period, with AUM levels at September 30, 2015 of $0.7 billion, a

37% decrease from AUM of $1.1 billion at September 30, 2014. Advisor departures in late August 2015 resulted in the loss of

approximately $0.8 billion in AUA and $0.6 billion in AUM.

Management fee revenue earned during the nine months ended September 30, 2015 increased to $12.5 million, compared with

the $9.9 million of management fees earned in the same period of the prior year. The increase reflected higher average AUM in

the first nine months of 2015 relative to the same period of the prior year.

Commission revenue increased by 2% during the first nine months of 2015 to $17.6 million, compared with $17.2 million earned

in the same period of the prior year. This increase is primarily the result of having nine months service from the addition of retail

advisors in March 2014.

Principal trading activities generated gains of $1.4 million during the first nine months of 2015, compared with $3.6 million in

the same period of the prior year, reflecting the impact of uncertain economic conditions on the portfolio of trading securities.


Variable compensation expense in the retail division was $18.8 million (nine months ended September 30, 2014 – $17.8 million),

representing approximately 57% (nine months ended September 30, 2014 – 55%) of related financial services and management

fee revenue, resulting in contribution margins of 43% (nine months ended September 30, 2014 – 45%). Financial advisors are

compensated on a variable scale, based on revenues generated. Certain professionals may also be compensated based on the

profitability of their respective division. The current period’s variable compensation reflects the effect of different payout models

in the non-retail departments of this division.

(in millions of dollars)

As at September 30, 2015 December 31, 2014 September 30, 2014

AUA 4,311$ 4,837$ 4,785$

AUM 712 1,197 1,133

Total 5,023$ 6,034$ 5,918$



The retail and other division incurred direct general and administrative expenses of $18.1 million during the first nine months of

2015, compared with $16.0 million incurred in the same period of the prior year. The increase is primarily attributable to

occupancy costs associated with new branches, as well as increased trade costs reflecting the increased volume of activity

resulting from the acquisition of advisors in March 2014. Allocated expenses decreased to $9.6 million, from $10.4 million in

the same period of the prior year.

CHANGES IN FINANCIAL CONDITION

Balances Directly Related to Dundee Securities

Client account balances represent funds owing from or belonging to clients, and amounts due to or from brokers and dealers that

are pending settlement. Securities owned and securities sold short represent trading positions of Dundee Securities and are

recorded at their fair values based on quoted prices where available, with changes in fair values included in principal trading

revenue. Client account balances and trading positions will vary significantly on a day-to-day basis and are dependent on

business activities and trading strategies in response to market conditions and in anticipation of price movements. These

variances do not necessarily reflect any meaningful changes to Dundee Securities’ financial position. At September 30, 2015,

client accounts receivable included $318.3 million of agency foreign exchange trading contracts (December 31, 2014 – $109.0

million), with a corresponding amount included in client deposits and related liabilities.

Call Loan Facilities

From time to time, Dundee Securities may utilize call loan arrangements to facilitate the securities settlement process for both

client and principal securities transactions, or to fund margin lending. At September 30, 2015, Dundee Securities had established

an uncommitted call loan facility for up to $100 million (December 31, 2014 – $100 million). There were no amounts drawn

pursuant to this facility at September 30, 2015.

DUNDEE ENERGY LIMITED



Client accounts receivable 917,896$ 536,073$

Client deposits and related liabilities (1,021,240) (639,692)

Securities owned 57,511 41,445

Securities sold short (12,296) (11,023)


Revenues

Oil and gas sales 20,112$ 30,716$

Interest and dividends 1,028 267

21,140 30,983

Cost of sales

Production expenditures (12,346) (10,969)

Other items in net (loss) earnings before taxes

Depreciation and depletion (8,958) (7,698)

General and administrative (3,185) (5,238)

Loss on derivative financial instruments - (116)

Interest expense (3,358) (3,309)

Foreign exchange gain 128 111

Net (loss) earnings before taxes, Dundee Energy Limited (6,579)$ 3,764$

Net (loss) earnings before taxes, Dundee Energy Limited attributable to:

Owners of Dundee Corporation (4,370)$ 2,664$

Non-controlling interest (2,209) 1,100

Net (loss) earnings before taxes, Dundee Energy Limited (6,579)$ 3,764$


During the nine months ended September 30, 2015, Dundee Energy incurred a net loss of $4.4 million attributable to owners of

Dundee Corporation. This compares to net earnings attributable to owners of Dundee Corporation of $2.7 million generated

during the same period of the prior year.

Sales and Production Volumes

During the nine months ended September 30, 2015, sales of oil and natural gas, net of royalty interests, generated revenues of

$20.1 million, a decrease of $10.6 million from revenues of $30.7 million earned during the same period of the prior year. The

effect of lower commodity prices decreased revenues by approximately $13.9 million, although these results were partially offset

by improved production volumes, which increased revenues by $3.3 million.

During the first nine months of 2015, Dundee Energy realized an average price on sales of natural gas of $4.30/Mcf, representing

an 8% premium over the average benchmark price at the Dawn Hub. Dundee Energy continues to benefit from its proximity to

the Dawn Hub, as it is a provider of natural gas supply to the greater Toronto market area. Despite this premium however, the

average realized price on sales of natural gas in the current period declined 41% from the average price of $7.29/Mcf realized by

Dundee Energy in the first nine months of the prior year. The realized price for natural gas in the first nine months of the prior

year reflected an increase in demand for natural gas in the January to April period, caused by unanticipated severe winter weather

conditions.

Volatility in the trading price for crude oil remains highly elevated, driven by uncertainty over future global economic growth

and supply/demand fundamentals. Consistent with this volatility, during the first nine months of 2015, Dundee Energy realized

an average price of $62.78/bbl on sales of crude oil, a 41% decrease from the average price of $105.90/bbl realized during the

same period of the prior year. On a comparative basis, the Edmonton Par average price for crude oil during the first nine months

of 2015 fell 41% below the average price for crude oil in the same period of 2014, while the U.S. dollar-denominated West Texas

Intermediate price for this commodity fell 49% on a period-over-period basis.

Field Level Cash Flows and Field Netbacks

Average daily volume during the nine months ended September 30, 2015 2014

Natural gas (Mcf/d) 11,785 9,784

Oil (bbls/d) 576 571

Liquids (bbls/d) 3 12

Total (boe/d) 2,543 2,214


Natural Gas Oil and Liquids Total Natural Gas Oil and Liquids Total

Total sales 13,830$ 9,887$ 23,717$ 19,482$ 16,660$ 36,142$

Royalties (2,088) (1,517) (3,605) (2,873) (2,553) (5,426)

Production expenditures (7,285) (5,061) (12,346) (6,212) (4,757) (10,969)

4,457 3,309 7,766 10,397 9,350 19,747

Gain (loss) on derivative financial instruments - 341 341 - (337) (337)

Field level cash flows 4,457$ 3,650$ 8,107$ 10,397$ 9,013$ 19,410$



$/Mcf $/bbl $/boe $/Mcf $/bbl $/boe

Total sales 4.30$ 62.57$ 34.16$ 7.29$ 104.69$ 59.81$

Royalties (0.65) (9.60) (5.19) (1.08) (16.04) (8.98)

Production expenditures (2.26) (32.03) (17.78) (2.33) (29.89) (18.15)

1.39 20.94 11.19 3.88 58.76 32.68

Gain (loss) on derivative financial instruments - 2.16 0.49 - (2.12) (0.56)

Field netbacks 1.39$ 23.10$ 11.68$ 3.88$ 56.64$ 32.12$



Capital Expenditures

In response to declining commodity prices for both crude oil and natural gas, Dundee Energy determined that it was appropriate

to significantly reduce its planned 2015 capital expenditure program. Accordingly, Dundee Energy’s work plan for 2015 was

budgeted at $0.9 million and was anticipated to consist primarily of costs associated with maintaining the existing and essential

land portfolio, as well as certain costs to complete projects that had been started in late 2014. To date, Dundee Energy has

incurred approximately $0.6 million of these budgeted capital expenditures, including $0.4 million related to Dundee Energy’s

land portfolio, $0.1 million related to the completion of prior year projects and $0.1 million to commence a project undertaken

through the “saveONenergy” program in the province of Ontario, which is assisting with funding to allow Dundee Energy to

right-size oil well pumping equipment, which will yield more efficient and reduced operating costs at certain southern Ontario

locations.

Demand Revolving Credit Facility

A subsidiary of Dundee Energy has established a $70.0 million credit facility with a Canadian Schedule I Chartered Bank. The

credit facility is structured as a demand revolving loan, and is subject to a tiered interest rate structure that varies based on the net

debt to cash flow ratio generated by the subsidiary. Based on current ratios, draws on the credit facility bear interest at prime

plus 3.5% for loans and letters of credit or, for bankers’ acceptances, at the bankers’ acceptance rate plus 4.5%. At September

30, 2015, an aggregate of $60.0 million had been drawn against the credit facility.

Given recent volatility in the prices of oil and natural gas, and more specifically, the substantial decrease in the price of crude oil

in the latter part of 2014 and early 2015, Dundee Energy’s lenders have requested that Dundee Energy make significant

reductions in the amounts borrowed pursuant to its credit facility, such that amounts borrowed are reduced to approximately

$55.0 million by the middle of 2016. Dundee Energy has made adjustments to its work plan for 2015 and it has taken certain cost

saving measures in its operations such that it expects to be in compliance with the lender’s requests by the second quarter of

2016. However, given the demand nature of Dundee Energy’s debt facility, there can be no assurance that the lenders to Dundee

Energy will not request further reductions in available borrowings pursuant to Dundee Energy’s credit facility to correspond to

further decreases in market prices of commodities, or otherwise.

UNITED HYDROCARBON INTERNATIONAL CORP.


Through its PSC with the government of the Republic of Chad, UHIC has the exlusive right to explore and develop oil and gas

reserves in four distinct blocks.

The Doba Basin, which includes both the DOC Block and the DOD Block, is located in southern Chad where two oil discoveries

from previous operators, the Belanga and M’Biku discoveries, are situated in close proximity to producing fields currently

operated by Exxon. In January 2015, UHIC drilled one unsuccessful exploration well at this site at a cost of approximately $2.1

million.

Two oil discoveries from previous operators within the 1.8 million acre Lake Chad Block are included in UHIC’s PSC, namely

the Kumia and Kanem discoveries. With 7,400 kilometres of 2-D seismic data, previous operators identified approximately 200

exploration leads or prospects in this area. Through its seismic review process, UHIC has identified five drill ready locations that

could be drilled when the commodity price environment improves. In January 2015, the governments of Chad and Niger

announced the formation of the Niger Oil Transportation Corporation (NOTCO) which has proposed a pipeline route from Niger

through UHIC’s Lake Chad Block, enroute to joining the export pipeline in the Doba Basin, and arrangement which could prove

profitable to UHIC in the future.

UHIC has historically focused its efforts on the Doba Basin and Lake Chad Block, and will evaluate the fourth block, the

Largeau Block, as part of its long-term strategy as the Largeau Block is more remote and relatively unexplored.


In response to significant downward pressure in the global price for oil, UHIC suspended drilling operations during the first

quarter of 2015, releasing the drilling rig, and issuing contract suspension and termination notices to most of its service providers.

During the nine month period ended September 30, 2015, UHIC reduced staffing levels commensurate with the reduced level of

operations.

Impairment of Resource Properties

The Corporation had previously announced that it was seeking to raise third party debt or equity of up to $250.0 million, the

proceeds of which would be used by UHIC in connection with its ongoing exploration programs. Following the sharp decline in

oil prices in late 2014 and continuing into 2015, the Corporation has not consummated a transaction. Current market conditions

do not support the underlying carrying value of UHIC’s resource properties. As a result, during the third quarter of 2015, the

carrying value of these properties was impaired by $215.2 million, to their estimated recoverable amount of $235.9 million.

The majority of exploration costs incurred by UHIC in the Republic of Chad are denominated in U.S. dollars. In accordance with

accounting requirements, the aggregate pool of capitalized exploration costs are translated into Canadian dollars at the end of

each financial reporting period using the prevailing foreign exchange rate.

The recoverable amounts of these resource properties were measured based on fair value less costs of disposal, determined by

applying comparable valuation metrics as determined in capital markets to UHIC’s most recent prospective resource estimates as

illustrated in the table below.

TOTAL

Balance, December 31, 2014 378,708$


Inventory, net of usage 5,328

Camps and civil works 968

Drilling and completion costs 2,374

Seismic, geology and geophysical 44

Pipelines and facilities 113

Other (land access and health and safety) (70)

Decommissioning liability additions (169)

Capitalized general and administrative costs 4,363

Cost basis of inventory sales (853)

Foreign currency translation 60,259

Balance, prior to Impairment 451,065

Impairment (215,156)

Balance, September 30, 2015 235,909$

Estimated Unrisked Estimated Value

Resources Range of Values of Unrisked Resources

Block (In millions of barrels) (US$/bbl) (In millions of US$)

The Doba Basin 100 million - 150 million $0.15 - $2.34 51.2$

Lake Chad 700 million - 1,000 million $0.05 - $0.24 125.8

Largeau No estimates n/a -

177.0

Exchange Rate 1.33

Estimated value of resources in millions of Canadian dollars 235.9$


In determining the magnitude of estimated unrisked resources, UHIC used its best estimate, and employed third-party

independent assessments, if available. However, this data is inherently imprecise and is subject to significant judgment. The

range of values per barrel of unrisked resources was determined using publicly available metrics of a basket of comparable

publicly-traded companies. These metrics are sensitive to the consequential reaction of capital markets to volatility in, and the

pricing outlook for oil. These factors may result in additional impairments to these properties, or may also result in the reversal

of such impairment if the underlying volatility and/or the price of oil improves.

Cash Resources

UHIC does not currently generate cash flows from its business activities, and it currently relies on its ability to raise funds

through capital markets or through debt from the Corporation. There can be no assurance that UHIC will be successful in raising

the necessary funds to support future operations.


UHIC normally capitalizes costs that are directly related to its exploration activities, including all costs incurred in the Republic

of Chad, as well as certain costs incurred at head office that relate specifically to these activities. Following the suspension of

drilling operations early in 2015, these general and administrative expenses have been expensed as incurred, contributing to a net

loss during the nine months ended September 30, 2015, before impairment charges of $31.4 million. Expenses incurred in the

nine months of the prior year include a $10.0 million discovery bonus paid by UHIC to the Corporation in recognition of the

contribution made by the Corporation towards an oil discovery, and $9.0 million in compensation expense relating to

amendments of terms of UHIC’s outstanding warrants.

(in millions of dollars)

Upon completion of activities required in order to effectively suspend drilling operations, UHIC anticipates that the property will

require costs of approximately $1.0 million to $1.5 million per month until a successful farmout is achieved or financing is

obtained.

DUNDEE SUSTAINABLE TECHNOLOGIES INC.

Reflective of its current stage of development, Dundee Technologies does not report any revenue. During the three and nine

months ended September 30, 2015, it incurred a net loss of $1.4 million and $4.7 million respectively (three and nine months

ended September 30, 2014 – $2.5 million, and $7.1 million respectively). Operating losses incurred during the three and nine

months ended September 30, 2015 include costs of $1.6 million and $3.7 million respectively, directly associated with the

development and construction of the demonstration plant designed as “proof of concept” for Dundee Technologies’ chlorination

process (three and nine months ended September 30, 2014 – $2.1 million and $6.5 million respectively). This “proof of concept”

is expected to support Dundee Technologies’ business model, which is based on using the technology in commercial plants built

with a consortium of mine owners.

For the three months ended September 30, For the nine months ended September 30,

2015 2014 2015 2014

Shut-down and contract termination costs 2.8$ -$ 7.8$ -$

Employee termination costs 0.2 - 2.3 -

Discovery bonus - - - 10.0

Warrant revaluation - - - 9.0

3.0 - 10.1 19.0

General and administrative costs:

Directly attributable to exploration activities 3.1 - 16.4 -

Head office and other ongoing expenses 1.3 1.6 4.0 4.6

4.4 1.6 20.4 4.6

Other net costs 0.9 0.4 0.9 0.9

8.3$ 2.0$ 31.4$ 24.5$


The construction of the demonstration plant was completed in June 2015 and the commissioning of the plant was finalized in

October 2015. At September 30, 2015, Dundee Technologies had expended $14.6 million towards the budgeted $25 million

required to complete and operate the plant during its demonstration phase.

During the third quarter of 2015, Dundee Technologies has been actively seeking the supply of various concentrate feed sources,

and has been negotiating with identified partners to secure sufficient volumes of concentrate feed material necessary for the

operation of the demonstration plant throughout 2016.

EUROGAS INTERNATIONAL INC.

After farming out its working interest to DNO, Eurogas International retained a 5.625% working interest in the Sfax offshore

permit. In early 2015, DNO completed the drilling of the Jawhara-3 well, the first exploration and appraisal well undertaken by

DNO on the Sfax offshore permit. The Jawhara-3 well was vertically drilled to a total depth of 2,815 metres. The Douleb and

Bireno fractured carbonates formations proved to be water bearing in the compartment of the principal structure targeted by the

well and therefore, DNO concluded that further analysis of the well’s logging and testing results would be required in order to re-

evaluate the Jawhara prospect. In view of these results, DNO reassessed its work plan for 2015 and sought an extension of the

first renewal period of the Sfax offshore permit. In August 2015, DNO received the necessary regulatory approval from the

Tunisian authorities for a two-year extension of the first renewal period related to the Sfax offshore permit, extending the first

renewal period and the associated exploration well drilling obligation to December 8, 2017. In addition, the extension requires

the acquisition of 700 km of 2-dimensional seismic.

During the three and nine months ended September 30, 2015, Eurogas International incurred a loss before income taxes of $0.2

million and $0.6 million respectively, compared with losses of $0.2 million and $0.8 million respectively in the three and nine

months ended September 30, 2014. The decrease in the net loss reflects substantial cost cutting initiatives which were

implemented by Eurogas International in early 2015.

BLUE GOOSE CAPITAL CORP.

Blue Goose continues to undergo significant strategic changes aimed at refocusing its core business and profitability, and

building out the “Blue Goose” brand.



Revenues

Sales 44,378$ 61,403$

Interest and dividends 170 665

44,548 62,068

Cost of sales (54,537) (78,460)

Other items in net loss before taxes



Loss on sale of net assets (4,392) -

Other general and administrative (5,404) (6,377)

Fair value changes in livestock 12,088 11,000

Interest expense (3,359) (1,510)

Foreign exchange gain (loss) 3 (2)

Net loss before taxes, Blue Goose Capital Corp. (13,688)$ (21,263)$

Net loss before taxes, Blue Goose Capital Corp. attributable to:

Owners of Dundee Corporation (11,988)$ (17,937)$

Non-controlling interest (1,700) (3,326)



Consistent with this mandate, two non-strategic business units were successfully divested in the first half of 2015. A transaction

to dispose of the majority of Blue Goose’s interest in Commonwealth Aggregate Company Incorporated (“Commonwealth”) was

completed in June 2015. Proceeds from the divestiture were $11.9 million, of which $7.4 million were used to fully repay

amounts outstanding under debt facilities previously provided for the operations of the Commonwealth business. Blue Goose

recorded an accounting gain on this sale of $0.9 million. Blue Goose also sold the assets of Emma Farms Cattle Company

(“Emma Farms”) and Owl Creek Lands, LLC (“Owl Creek”), through which it operated its U.S. Wagyu business activities,

including all cattle and land assets. The sale price of US$17.8 million (Cdn$21.9 million) provided net proceeds to Blue Goose

of US$11.3 million (Cdn$14.0 million), after repayment of debt outstanding in respect of these operations, and resulted in a loss

of $5.3 million. The net loss on the sale of these assets has been reported in the September 2015 Interim Consolidated Financial

Statements as a component of general and administrative costs as illustrated in the previous table.

During the nine months ended September 30, 2015, Blue Goose incurred a net loss attributable to owners of Dundee Corporation

of $12.0 million, inclusive of a net $4.4 million loss associated with divestitures as outlined above. After adjusting for these

amounts, operating losses attributable to owners of Dundee Corporation during the nine months ended September 30, 2015 were

$7.6 million, a substantial improvement over losses attributable to the owners of Dundee Corporation of $17.9 million in the

same period of the prior year. This is largely the result of operational changes leading to cost reductions in the Blue Goose

poultry business, as well as a reduction of overhead expenses.

Unit Sales

Contribution Margins

During the nine months ended September 30, 2015, Blue Goose achieved a positive contribution margin of $1.9 million on sales

of $44.4 million, compared with a negative contribution margin of $6.1 million on sales of $61.4 million during the same period

of the prior year.

Beef sales decreased by $2.4 million or 18%, compared with the same period of the prior year. The decrease resulted from the

winding down of cattle operations on Manitoulin Island which was initiated in 2014, as well as the sale of the U.S. Wagyu

business previously conducted through Emma Farms and Owl Creek, which together contributed revenue of $2.6 million for the

nine months ended September 30, 2014, compared with $0.4 million for the nine months ended September 30, 2015. Net of these

amounts, sales decreased by approximately 2% over the same period of the prior year. Blue Goose is focused on the continuing

expansion of its organic beef production capacity.

Chicken sales decreased by $8.2 million or 47% due to a planned exiting of unprofitable SKUs. Blue Goose’s chicken business

will remain focused on its profitable SKUs, including both fresh poultry and consumer packaged goods. Blue Goose has

achieved significant operating efficiencies and cost reductions during the nine months ended September 30, 2015, which it

expects will result in higher contribution margins for poultry on a going forward basis.

Unit sales for the nine months ended September 30, 2015 2014

Beef (kgs) 1,743,293 1,700,132

Chicken (kgs) 1,073,969 2,096,768

Consumer packaged goods (cases) 761 21,811

Fish (lbs) 1,409,964 678,306


Cost of Fair Value Cost of Fair Value

Components of Agriculture Products Revenue Sales Changes Margin % Margin Revenue Sales Changes Margin % Margin

Beef 10,992$ 18,930$ 10,179$ 2,241$ 20.4% 13,410$ 19,961$ 8,026$ 1,475$ 11.0%

Chicken 9,432 9,918 - (486) (5.2%) 17,674 25,404 - (7,730) (43.7%)

Fish 3,449 6,300 1,909 (942) (27.3%) 2,220 6,795 2,974 (1,601) (72.1%)

Feed 18,448 17,825 - 623 3.4% 24,279 23,748 - 531 2.2%

Other 2,057 1,564 - 493 24.0% 3,820 2,552 - 1,268 33.2%

44,378$ 54,537$ 12,088$ 1,929$ 4.3% 61,403$ 78,460$ 11,000$ (6,057)$ (9.9%)


Fish sales increased by $1.2 million or 55%, reflecting significant physical growth of fish stock, rendering additional market-

ready inventory. Blue Goose has focused on selling whole fish and moving away from further processing its harvest, resulting in

lower average revenue per pound, compared with sales in the same period of the prior year.

Feed sales decreased by $5.8 million or 24% as a result of a local outbreak of the avian flu which affected the local market and

correlated demand for feed in the second quarter of 2015.


Consistent with initiatives undertaken by other operating segments of Dundee Corporation, Blue Goose has undertaken an

assessment of its administrative costs with a mandate of improving efficiencies. During the nine months ended September 30,

2015, general and administrative expenses decreased to $5.4 million, compared with general and administrative expenses of $6.4

million incurred in the same period of the prior year.


Changes in the Carrying Value of Land and Other Capital Assets

Blue Goose has acquired high quality, productive land acreage which provides quality hay for winter cattle feeding.

Landholdings at September 30, 2015 were comprised of approximately 1.2 million acres, including both freehold (deeded) acres

and leasehold acreage in British Columbia, Ontario and Colorado.

As previously discussed, during the second quarter of 2015, Blue Goose divested its U.S. Wagyu business, including all of its

U.S. landholdings in Colorado. Blue Goose is also continuing to divest its non-strategic landholdings in northern Ontario.

Changes in Livestock Carrying Values

Blue Goose has increased its herd count to 13,612 as at September 30, 2015 from 11,724 at December 31, 2014. This increase is

net of the sale of the assets of Emma Farms, which included 1,054 head of Wagyu cattle. The company will continue to increase

the size of its organic cattle herd to support future sales growth.

Number of Acres Deeded or Leased as at

(in thousands) September 30, 2015 December 31, 2014

British Columbia 1,191 1,119

Ontario 7 8

Colorado - 18

1,198 1,145

Inventory and

Cattle Fish Supplies TOTAL

Carrying value, beginning of the period 24,505$ 4,080$ 5,505$ 34,090$


Net additions 3,056 197 30,927 34,180

Herd growth - physical changes 9,207 1,909 - 11,116

Herd growth - price changes 972 - - 972

Disposition of Emma Farms, Owl Creek and Commonwealth (3,580) - (3,371) (6,951)

Net of product processed (7,973) (3,480) (29,901) (41,354)

Carrying value, end of the period 26,187$ 2,706$ 3,160$ 32,053$

Cattle herd as at

(number of animals) September 30, 2015 December 31, 2014

Breeding cattle and bulls 6,263 5,123

Immature livestock and feeder cattle 7,349 6,601

13,612 11,724


Corporate Debt

On May 26, 2015, Blue Goose Cattle Company Ltd., a subsidiary of Blue Goose, entered into a credit facility with a Canadian

Schedule I Chartered Bank. The credit facility provides the subsidiary with (i) a $7.5 million demand revolving credit facility

bearing interest at prime plus 0.50%, thereby increasing borrowing availability from the previous revolving demand credit facility

of $5.5 million; (ii) a $4.7 million one-time advance for the purchase of certain real estate property, which amount bears interest

at prime plus 1.50%, formalizing the provisional promissory note arrangement in the amount of $5.0 million established earlier in

the year; (iii) a one-time capital expenditure advance of $0.6 million, bearing interest at prime plus 1.50%; and (iv) a revolving

facility of up to $0.5 million for the purchase of machinery and equipment, bearing interest at prime plus 0.50%. At September

30, 2015, the subsidiary had borrowed $6.5 million pursuant to the $7.5 million demand revolving credit facility and it had drawn

$4.6 million and $0.5 million pursuant to the one-time advance arrangements as described above to fund the acquisition of certain

real estate and the related capital expenditures required on the property acquired. The credit facility is secured against all of the

assets of Blue Goose Cattle Company Ltd. In addition, Blue Goose has provided a guarantee for up to $3.5 million as further

security against the credit facility.

Through its U.S. subsidiaries, Blue Goose had entered into a US$6.0 million fixed term mortgage facility to finance the

acquisition of property in Colorado, and a US$1.0 million facility to support its Wagyu cattle operations. At the time of the sale

of the property and associated Wagyu cattle operations, as previously mentioned, aggregate amounts borrowed pursuant to these

facilities were $7.9 million. Concurrent with the closing of the sale of the property and the associated operations, amounts

borrowed under these arrangements were fully repaid and the associated obligations were released.

Blue Goose had also entered into a $7.0 million demand fixed term debt facility and a $1.0 million demand revolving credit

facility to support the operations of its Commonwealth aggregates business. Amounts borrowed pursuant to these arrangements

immediately prior to the sale of the Commonwealth business, as previously mentioned, were $7.4 million. Concurrent with

completion of the sale of Commonwealth, all amounts borrowed pursuant to these arrangements were repaid, and the loan

arrangements were terminated.

Blue Goose and its subsidiaries have established credit facilities of up to $24.8 million with a leading lender to the agricultural

sector that require the maintenance of certain financial covenants customary to such loan arrangements, including the

maintenance of certain interest coverage ratios in excess of specified amounts and covenants that limit the amount of liabilities

that may be assumed by Blue Goose or its subsidiaries. The loan arrangements also oblige Blue Goose and its subsidiaries to

comply with certain reporting requirements, including the delivery of financial information and debt covenant certification as

provided for in the loan arrangements. At September 30, 2015, $22.7 million of debt in Blue Goose and some of its subsidiaries

was in default of certain financial covenant requirements pursuant to these arrangements. With the knowledge of the lenders,

Blue Goose and its subsidiaries are actively engaged in ensuring that deficiencies are rectified. The lending institutions to Blue

Goose do not have recourse to the Corporation in respect of any of the amounts borrowed by Blue Goose and its subsidiaries.

Certain wholly-owned subsidiaries of Blue Goose have entered into demand credit facilities in order to provide working capital to

facilitate underlying operations. Borrowings under these arrangements bear interest at a rate per annum of prime. These demand

revolving credit facilities are secured by a general security agreement against all of the assets of the underlying subsidiaries, and

are guaranteed by Blue Goose. At September 30, 2015, Blue Goose and its subsidiaries had borrowed $7.2 million pursuant to

these arrangements.


AGRIMARINE HOLDINGS INC.


On July 3, 2014, the Corporation acquired control of AgriMarine following the conversion of previously issued convertible notes,

following which the Corporation began to consolidate the operations of this entity. As a result, the operations for the

comparative period outlined below represent the results of AgriMarine for the period between acquisition of control on July 3,

2014 to September 30, 2014, whereas the results in 2015 include the results of a full nine months of operations.

During the nine months ended September 30, 2015, AgriMarine incurred a net loss of $21.9 million attributable to owners of

Dundee Corporation. On May 23, 2015, AgriMarine Technologies executed definitive transaction documents for the

manufacture and sale of two closed-containment tanks to a third-party in Norway as part of a collaborative research and

development project. These arrangements replaced what had been originally conceived by AgriMarine as a future royalty and

master license agreement with the same third-party, and which had been carried at a value of $13.6 million. Accordingly, during

the second quarter of 2015, AgriMarine accelerated the depreciation of the intangible asset by $13.6 million, bringing its future

value to zero. In addition, during the third quarter of 2015, AgriMarine wrote down certain capital assets by a further $4.5

million after a reassessment of their future value to current operations. After adjusting for these one-time charges, operating

losses attributable to owners of Dundee Corporation were approximately $3.8 million, compared with operating losses of $2.5

million in the comparative period of 2014.

Contribution Margins

During the nine months ended September 30, 2015, AgriMarine generated revenue of $4.9 million and negative contribution

margins before fair value changes and writedowns of $0.1 million. The volume of fish sold during the nine months ended

September 30, 2015 was 663,000 kilograms, representing an average selling price of $7.16 per kilogram. The cost of sales for

the nine months ended September 30, 2015 before inventory writedowns was $5.0 million.

For the period ended September 30, 2015 2014

Revenues

Sales of livestock 4,922$ 1,626$

Interest, dividends and other 50 -

4,972 1,626

Cost of sales (6,122) (2,748)


Depreciation and depletion (18,134) -


Fair value changes in livestock 682 (427)

Interest expense (15) (2)


Net loss before taxes, AgriMarine Holdings Inc. (22,029)$ (2,671)$

Net loss before taxes, AgriMarine Holdings Inc. attributable to:


Non-controlling interest (93) (134)


For the period ended September 30, 2015 2014

Revenues 4,922$ 1,626$

Cost of sales (4,960) (1,512)

Contribution margin before fair value changes and writedowns (38) 114


Writedowns (1,162) (1,236)

(518)$ (1,549)$



The carrying value of AgriMarine’s biological assets and inventory at September 30, 2015 was $8.5 million, an increase of $2.9

million from values of $5.6 million at December 31, 2014. AgriMarine is actively building up its biological assets to meet future

demand, which is expected to occur towards the end of 2015. Included in these initiatives is the addition of two closed-

containment tanks at its West Coast Fishculture site to increase AgriMarine’s biomass capacity.

DUNDEE 360 REAL ESTATE CORPORATION

During the nine months ended September 30, 2015, Dundee 360 generated a net loss attributable to the owners of Dundee

Corporation of $11.7 million. Dundee 360 reported a net operating loss attributable to owners of Dundee Corporation of $3.0

million in the comparative period of the prior year, representing losses incurred by Dundee 360 since July 2, 2014, the effective

date of the Corporation’s acquisition of control of Dundee 360.

Operating losses in the first nine months of 2015 include $9.5 million of depreciation costs associated with the amortization of

certain intangible assets obtained as part of the July 2014 acquisition of control as outlined above.


Real Estate Brokerage and Sales and Marketing Activities

Gross commission revenues for the listing, marketing and selling of real estate assets during the nine months ended September

30, 2015 were $51.9 million. Commissions paid to associated brokers and agents in respect of this revenue stream were $47.2

million, providing Dundee 360 with a contribution margin of $4.7 million or 9%. In addition, Dundee 360 earned $5.3 million of

other revenue in this division, consisting primarily of fees paid by its network of brokers and agents for the provision of

marketing, administrative and support services.

Biological Inventory and

Assets Supplies TOTAL

Carrying value, beginning of period 4,914$ 707$ 5,621$


Net additions 2,276 (54) 2,222

Biomass growth 682 - 682

Carrying value, end of period 7,872$ 653$ 8,525$

Sales and Hospitality and Real Estate

For the nine months ended September 30, 2015 Marketing Asset Management Developments Other Total

Revenues

Gross commission income 51,854$ -$ -$ -$ 51,854$

Consulting and management fees - 7,461 4,112 - 11,573

Sales and marketing fees 463 - - - 463

Other revenue 5,330 62 82 48 5,522

Interest, dividends and other (8) 113 118 (191) 32

57,639 7,636 4,312 (143) 69,444

Cost of sales (47,235) - - - (47,235)


Depreciation and depletion (886) (2,548) (5,887) (198) (9,519)

General and administrative (10,445) (2,405) (5,389) (6,322) (24,561)

Share of income from real estate joint ventures - - 143 - 143

Finance expense - - - - -

Net (loss) earnings before taxes, Dundee 360 Real Estate Corporation (927)$ 2,683$ (6,821)$ (6,663)$ (11,728)$

Net (loss) earnings before taxes, Dundee 360 Real Estate Corporation attributable to:

Owners of Dundee Corporation (927)$ 2,683$ (6,765)$ (6,663)$ (11,672)$

Non-controlling interest - - (56) - (56)

Net (loss) earnings before taxes, Dundee 360 Real Estate Corporation (927)$ 2,683$ (6,821)$ (6,663)$ (11,728)$


Through its wholly-owned subsidiary, Blueprint Global Marketing Ltd. (“Blueprint”), Dundee 360 may be awarded the exclusive

right to the sales and marketing of large condominium projects. These activities generated revenues of $0.5 million during the

nine months ended September 30, 2015. Dundee 360 is actively working on a new strategic business plan for its Blueprint

activities that is focused on future growth potential with the ability to create synergies with Dundee 360’s other core business

areas.

Hospitality and Asset Management Activities

Hospitality and asset management activities encompass the management and operations of international hotel, resort, residential

and commercial properties.

Dundee 360 has entered into a series of agreements with members of Enchantment Group, a resort company based in the United

States to manage the “Enchantment Resort” and the associated “Mii amo” destination spa in Sedona, Arizona and the “Tides

Inn” in Virginia. These arrangements expire in May 2025. As part of these arrangements, Dundee 360 has agreed to prepare a

plan for redevelopment in exchange for an option to acquire an interest in the Tides Resort and Tides Inn. The option, which

expires in November 2015, carries a penalty of $1.0 million if such option is not exercised. Negotiations are currently underway

to mutually agree upon the underlying value of the asset and the related re-development plan for the project which will impact

Dundee 360’s decision on whether to exercise the option. Accordingly, Dundee 360 has not recorded a liability in respect of this

option payment. Under the terms of these arrangements, Dundee 360 is also committed to assume 50% of any operating losses

incurred by the Tides Inn for a period of up to three years commencing November 13, 2015, which is currently estimated at

US$2.0 million in total.

Pursuant to an agreement with Northlight Asset Management II LLC, the controlling shareholder of Seven Canyons Golf Course

in Sedona, Arizona, Dundee 360 will manage the property for an initial term of 30 years ending in May 2043. Furthermore, in

January 2015, Dundee 360 entered into a loan agreement whereby it advanced US$0.8 million to improve and redevelop

amenities on the property. This loan is due to mature in May 2020 (inclusive of two 12-month extension periods) and bears

interest of 15%, of which 8% is payable monthly and 7% is deferred and added to the principal balance due upon maturity.

In the second quarter of 2015, Dundee 360 added three new hospitality agreements as part of its focused strategy to grow its

recurring fee-based revenue activities. Under these agreements, Dundee 360 is to provide management services for a luxury

resort in the Bahamas and two resorts in Arizona. Revenues are earned as a percentage of the resorts’ annual gross operating

revenue, with one of the agreements subject to a guaranteed annual floor amount. Dundee 360 is entitled to receive incentive

fees if certain net operating income targets are met by the resorts.

Included in consulting and management fee revenue during the nine months ended September 30, 2015, is a $4.0 million

termination payment received by Dundee 360 in respect of its arrangement with Ivanhoé Cambridge to provide hotel

management services for certain hotels that operate under the “Fairmont” and “Hilton” banners. In connection with the

termination, depreciation expense during the nine months ended September 30, 2015 includes $1.7 million of accelerated

depreciation relating to the value of the intangible asset previously attributed to the now terminated contract. The accelerated

depreciation reduces the carrying value of the intangible asset to zero.

During the nine months ended September 30, 2015, Dundee 360 generated total revenues of $7.6 million from hospitality and

asset management activities, inclusive of the $4.0 million termination payment.

Real Estate Development Activities

Parq Resort & Casino

Dundee 360 has entered into development and asset management agreements with affiliates of Paragon Gaming Inc. to

jointly develop and operate the resort site in Vancouver that will host the relocated Edgewater Casino and other recreational

and tourist facilities. The Parq Resort & Casino project has an estimated full build-out cost of approximately $630 million.

The project continues to proceed on schedule with expected completion of construction at the end of 2016. During the nine

months ended September 30, 2015, Dundee 360 earned revenues of $1.6 million in fees from this project, which is

calculated as a percentage of total construction costs.


Edenarc 1800

Edenarc 1800 is a ski-in and ski-out resort project development in the French Alps. Sotarbat 360, a French entity domiciled

in Savoie, France, is the builder of the project. Dundee 360 is engaged as the development and construction manager,

earning fees for the services provided as a percentage of construction costs and is also responsible for the sales and

marketing of the project. Edenarc 1800 is a 9-phase project having an estimated remaining build-out cost of approximately

$60 million for the last five phases scheduled over the next three years, which is expected to generate fees of up to $1.9

million. The project is being financed directly by the builder or with other traditional bank financing. During the nine

months ended September 30, 2015, fees generated from this project totalled $0.6 million from the completion and delivery

of the project’s third phase, a 48-unit apartment and hotel complex. Dundee 360 has also commenced construction and pre-

sold 60% of the project’s fourth phase, for which delivery is expected to be December 2015, approximately six months

ahead of schedule.

In addition to providing the above services, Dundee 360 has a 45% equity interest in Sotarbat 360, subject to a priority

interest by the builder to a full recovery of all costs of development of the project. Dundee 360 accounts for its investment

in Sotarbat 360 as a real estate joint venture investment, with a book value at September 30, 2015 of $2.5 million. The

investment fluctuates on a monthly basis as a result of changes in Sotarbat 360’s profit or loss and foreign exchange as the

investment is denominated in euros.

Project Management and Procurement

Dundee 360 provides project management and procurement services to a number of hotels, including those owned by

Ivanhoé Cambridge, to oversee refurbishments and infrastructure capital projects for which it earns fees based on a

percentage of capital invested. During the nine months ended September 30, 2015, Dundee 360 earned revenues of $1.9

million in fees from project management and procurement services.

Development in the Gangwon Province

Dundee 360 has signed a framework agreement with the Gangwon Province of the Republic of Korea pursuant to which

Dundee 360 will provide advisory services for the planning and development of a world class, year-round recreational and

mixed-use real estate development. The project is directly south of and in close proximity to the 2018 Winter Olympic site

of Gangneung, and encompasses approximately 600 hectares of land with 2.5 kilometres of prime beachfront on the East

Sea. Dundee 360’s planning and development services will provide the project with a master plan and related economics to

which the East Coast Development Company can structure financing and monetize Dundee 360’s investment.

On February 26, 2015, Dundee 360’s wholly-owned Korean subsidiary, Dundee 360 East Coast Development Company,

was granted official project developer status for this project and the first committed investment of ₩600,000,000

(Cdn$673,000) under the framework agreement was received in July 2015 with the next installment expected in December

2015.

Clearpoint Resort

Dundee 360 has an approximate 86% interest in Clearpoint Resort Limited, a Maltese corporation (“CRLM”), through

which Dundee 360 will develop the Clearpoint Resort project in Cavtat, Croatia, and in close proximity to Dubrovnik. A

master planned hotel, marina and recreational accommodations project, the Clearpoint Resort project has an estimated full

build-out cost of $185 million and requires land accumulation of 25.6 acres, of which approximately 5.9 acres is currently

owned. Amounts owing to the Erste & Steiemarkische Bank in respect of CRLM were fully repaid in April 2015, resulting

in the extinguishment of all debt arrangements and liens against the property. Dundee 360 is currently looking for potential

investors to fund the acquisition of the remaining land parcels and future development costs.

First Bay Resorts Limited

Dundee 360 has advanced approximately $2.2 million to First Bay Resorts Limited to finance the development of a second

project in Primosten, Croatia. Dundee 360 is currently assessing the opportunity to refinance a third party loan on the

project and convert its loan to an equity investment in the underlying development project.



During the nine months ended September 30, 2015, Dundee 360 reviewed the operating efficiencies in each of its business

divisions, with a mandate to optimize cost savings. As part of the Corporation’s cost-savings initiatives, Dundee 360 reduced

over $2.8 million in annualized overhead costs with a severance cost of $2.0 million that has been included in general and

administrative expenses in the current nine month period.

Opportunities in Cuba

Dundee 360 has entered into a joint venture agreement with an agency of the Government of Cuba to develop a number of

specific hotel properties in Cuba (the “Cuban Development Agreement”). The Cuban Development Agreement provides for the

construction of 11 hotels and real estate developments at four different sites and, at two of the proposed sites, the construction or

acquisition and operation of other major tourist and recreational facilities.

Pursuant to the Cuban Development Agreement, Dundee 360 currently owns approximately 61% of Vancuba Holdings S.A.

(“Vancuba”), the ultimate joint venture company that is undertaking the activities contemplated by the Cuban Development

Agreement. The activities of Vancuba are accounted for on an equity basis and have been included in the September 2015

Interim Consolidated Financial Statements as a real estate joint venture investment with a carrying value of $0.3 million.

Dundee 360 and Vancuba hold a 30% equity interest in Bellavista Resorts S.A. (“Bellavista”). Bellavista has acquired land rights

for one of the proposed sites subject to the Cuban Development Agreement, pursuant to a long-term lease agreement with the

Government of Cuba. The Bellavista venture has been included in the September 2015 Interim Consolidated Financial

Statements as a real estate joint venture with a carrying value of $6.0 million.

In December 2014, the United States government announced the process of restoring international relations with Cuba. On April

14, 2015, the United States government also announced that it will be removing Cuba from its list of nations that sponsor

terrorism. Furthermore, on July 20, 2015, the resumption of diplomatic relations between the two nations was further

strengthened when the United States officially reopened its embassy in Havana, Cuba. As a result of these positive changes,

Dundee 360 is continuing to pursue various strategic financing and partnership alternatives to develop its assets in Cuba.


Real Estate Debt

Dundee 360, through its investment in a subsidiary, assumed a long term obligation with Erste & Steiemarkische Bank in Croatia

that is secured by land held in Croatia. In April 2015, Dundee 360 repaid the remaining principal amount on the loan plus

interest against amounts borrowed. All other loans and borrowings by Dundee 360 are short term in nature and are due within

the next 12 months.

Settlement of Compensation Earn-out Liability

On October 1, 2011, Dundee 360 acquired 100% control of 360 VOX Developments Inc., a privately owned development and

operations company. Included in the share purchase agreement was a compensation earn-out provision whereby the former

shareholders of 360 VOX Developments Inc. were entitled to $3.0 million if non-Cuban revenue exceeded $30.0 million before

December 31, 2016. During the second quarter of 2015, the Corporation settled the $3.0 million liability by issuing 256,420

Class A subordinate voting shares from treasury.

OTHER CONSOLIDATED BALANCES AND CAPITAL STRUCTURE


Generally, head office costs, including costs associated with corporate governance and related public company costs, are

accumulated and reported as head office costs and are not allocated to other operating segments. During the nine months ended

September 30, 2015, the Corporation reported general and administrative expenses of $19.2 million, compared with general and

administrative expenses of $4.7 million incurred in the same period of the prior year.


The Corporation’s stock based compensation expense relating to awards made prior to the creation and subsequent distribution of

the Corporation’s interest in DREAM, is correlated to the market value of the underlying DREAM shares. These arrangements

are recognized as liabilities at fair value, with changes in fair value reported in net earnings. During the nine months ended

September 30, 2015, the fair value of these liabilities decreased stock based compensation expense by $4.0 million, compared

with a decrease in stock based compensation expense of $9.7 million in the same period of the prior year.

In addition, during the first quarter of the prior year, the Corporation adjusted its estimate of incentive compensation, which

further reduced liabilities accrued by $6.0 million, with a corresponding reduction in general and administrative expenses.

During the nine months ended September 30, 2015, incentive compensation was estimated at $1.5 million, causing a variance in

incentive compensation on a comparative period-over-period basis of $7.5 million.

Included in general and administrative expenses during the nine months ended September 30, 2015 are approximately $5.8

million of costs associated with the retention of new employees that have been tasked with the specific mandate of developing a

wealth management segment. These endeavours are expected to increase general and administrative costs by an additional $3.5

million throughout the fourth quarter of 2015.

Corporate Interest Expense

Corporate interest expense, before intersegment eliminations, was $7.7 million during the nine months ended September 30,

2015, a $1.2 million increase from the $6.5 million of interest expense incurred in the same period of the prior year, reflecting an

increase in the average borrowings over the respective periods.

Income Tax Recovery

The Corporation’s effective income tax recovery rate of 12.5% for the nine months ended September 30, 2015 (nine months

ended September 30, 2014 – effective income tax recovery rate of 9.6%) was different from the statutory combined federal and

provincial tax rate of 26.5%, primarily due to losses incurred by certain subsidiaries, the benefits of which were not recognized in

the September 2015 Interim Consolidated Financial Statements.

Net Deferred Income Tax Liabilities

The Corporation’s net deferred income tax assets at September 30, 2015 were $28.1 million, and represent deferred income tax

assets of $100.1 million, offset by deferred income tax liabilities of $72.0 million. This compares to net deferred income tax

liabilities of $40.2 million at December 31, 2014. Net deferred income tax assets increased as a result of changes in the fair value

of the Corporation’s investments. Components of the Corporation’s net deferred income tax assets are detailed in note 27 to the

September 2015 Interim Consolidated Financial Statements.

The Corporation’s aggregate income tax loss carry forwards at September 30, 2015 were $499.5 million (December 31, 2014 –

$288.2 million). Included in the Corporation’s deferred income tax balances is a tax benefit of $71.4 million (December 31, 2014

– $32.6 million) in respect of these tax losses.

Corporate Debt

Other than as described below, there have been no significant changes in the terms of the Corporation’s corporate debt

arrangements from those described in note 20 to the 2014 Audited Consolidated Financial Statements. At September 30, 2015,

the Corporation was in compliance with all financial covenants pursuant to these corporate debt arrangements.

$6.5 million $70 million Blue Dundee

Exchangeable $250 million Dundee Goose 360

Debentures Corporate Energy Debt Debt TOTAL

Balance, December 31, 2014 6,473$ 89,596$ 61,617$ 52,018$ 3,935$ 213,639$

Draws (Repayments) (6,473) 3,052 (2,195) (10,487) (3,209) (19,312)

Balance, September 30, 2015 -$ 92,648$ 59,422$ 41,531$ 726$ 194,327$

Revolving Term Credit Facilities


On April 30, 2015, the Corporation amended its existing debt facility, favourably modifying the terms of certain financial ratios

that establish the Corporation’s borrowing capacity in correlation to the fair value of certain of the Corporation’s investments. In

connection with the amendment, the maximum borrowing amount available pursuant to the credit facility was reduced from $300

million to $250 million. Borrowings under the amended facility bear interest at a rate per annum equal to the prime lending rate

for loans plus 0.60% or, at the Corporation’s option, at the prevailing bankers’ acceptance rate or London Interbank Offered Rate

plus 1.60%, provided amounts borrowed are less than $140 million. If amounts borrowed exceed $140 million, amounts drawn

against the credit facility will bear interest at a rate per annum equal to the prime lending rate for loans plus 0.75% or, at the

Corporation’s option, at the prevailing bankers’ acceptance rate or London Interbank Offered Rate plus 1.75%. Unused amounts

available under the amended facility are subject to an annual standby fee rate ranging from 0.36% to 0.39375%. The amended

facility matures on November 11, 2016.

At December 31, 2014, the Corporation had 6,490 outstanding exchangeable unsecured subordinated debentures with a par value

per debenture of $1,000, maturing on June 30, 2015. Prior to June 30, 2015, debentures with a par value of $13,000 were

submitted for exchange pursuant to the terms of these debentures, requiring the Corporation to deliver 436 units of DREAM

Office Real Estate Investment Trust in settlement thereof. On June 30, 2015, the Corporation repaid the remaining $6.5 million

due pursuant to these debentures by delivering (i) a further 218,175 units of DREAM Office Real Estate Investment Trust with a

value of $5.3 million, being all of the remaining units of DREAM Office Real Estate Investment Trust held by the Corporation

on June 30, 2015; and (ii) cash of $1.2 million. The obligations of the Corporation pursuant to the terms of the debentures were

subsequently extinguished.

Debt of Subsidiaries

A more detailed discussion of corporate debt in each of the Corporation’s business segments is presented under “Segmented

Results of Operations”.

Share Capital

Preference Shares

At September 30, 2015, the Corporation’s outstanding preference share arrangements were as follows:

Common Shares

As at September 30, 2015, there were 55,531,801 Class A subordinate voting shares and 3,115,232 Class B common shares

outstanding. At November 12, 2015, the number of outstanding shares had increased to 55,529,801 Class A subordinate voting

shares and 3,115,232 Class B common shares.

On April 14, 2015, the Corporation announced that it had received regulatory approval for the renewal of its normal course issuer

bid from April 16, 2015 to April 15, 2016. The normal course issuer bid allows the Corporation to purchase up to a maximum of

3,576,599 Class A subordinate voting shares for subsequent cancellation, representing approximately 10% of the public float at

the time approval for the normal course issuer bid was granted. During the third quarter of 2015, the Corporation acquired

55,000 Class A subordinate voting shares for cancellation pursuant to these arrangements, at a total cost of $0.5 million,

representing a cost of $9.73 per share.

In April 2015, the Corporation issued 256,420 Class A subordinate voting shares with a value of $3.0 million to certain

executives of Dundee 360. These shares were issued pursuant to the terms of the acquisition of Dundee 360 completed in July

2014.

Trade # of Shares Face Value Total

Symbol Series Outstanding per Share Face Value Coupon Rate Carrying Value

DC.PR.B Series 2 3,479,385 $25.00 $86,985 5.688% - 5-year fixed rate $84,053 equity instrument

DC.PR.D Series 3 1,720,615 $25.00 $43,015 4.77% - quarterly floating rate $43,015 equity instrument

DC.PR.C Series 4 6,000,000 $17.84 $107,040 5.00% fixed rate $106,852 debt instrument


During the nine months ended September 30, 2015, the Corporation issued 2,089,107 Class A subordinate voting shares on the

exercise of options and it issued 45,013 Class A subordinate voting shares on settlement of deferred share units upon the

departure of a director.

At September 30, 2015, the Corporation had issued 1,272,157 deferred share units under its deferred share unit plan, each

deferred share unit of which tracks the value of the Corporation’s Class A subordinate voting shares. In addition, the Corporation

had awarded 1,285,079 deferred share units that track the value of a Class A subordinate voting share of DREAM. There were no

options outstanding as at September 30, 2015.

The terms of the Corporation’s share based compensation arrangements are summarized in note 27 to the 2014 Audited

Consolidated Financial Statements.

CONSOLIDATED LIQUIDITY AND CAPITAL RESOURCES

As at September 30, 2015, the Corporation had cash of $274.4 million, compared with cash of $245.8 million at December 31,

2014. Included in the Corporation’s consolidated cash balance is $190.5 million of cash used in the operating businesses of the

Corporation’s asset management and brokerage subsidiaries. These subsidiaries function in regulated environments and are

therefore required to maintain levels of capital in liquid assets, in accordance with regulatory requirements. The amount of

capital that exists within these regulated entities may dictate the level of business operations, including margin lending, securities

trading and corporate finance commitments. Furthermore, the ability to transfer cash resources out of these regulated subsidiaries

may be limited by their requirement to comply with regulatory capital requirements. At September 30, 2015 and December 31,

2014, the Corporation’s regulated subsidiaries exceeded their minimum regulatory capital requirements.

Certain of the credit facilities available to the Corporation’s agriculture subsidiary, Blue Goose, and to certain subsidiaries of

Blue Goose, require the maintenance of financial covenants that are customary to the nature of the underlying loan arrangements,

including the maintenance of certain interest coverage ratios in excess of specified amounts and covenants that limit the amount

of liabilities that may be assumed by Blue Goose and the subsidiaries. At September 30, 2015, Blue Goose and the related

subsidiaries were in default of certain financial covenant requirements in respect of $22.7 million of its debt. With the

knowledge of the lender, Blue Goose and its subsidiaries are actively engaged in ensuring that these deficiencies are rectified.

The lending institution to Blue Goose does not have recourse to Dundee Corporation in respect of any of the amounts borrowed

by Blue Goose and its subsidiaries.

Significant Sources and Uses of Cash

Significant transactions affecting cash flows during the nine months ended September 30, 2015 and September 30, 2014 are

discussed below.

Significant Cash Flows – Operating Activities

* Adjusted net earnings or loss are equal to net earnings or loss adjusted for items not affecting cash and other adjustments.

During the nine months ended September 30, 2015, balances related to investment dealer activities, including client account

balances and brokerage securities owned and sold short resulted in net cash outflows of $30.1 million (nine months ended

September 30, 2014 – $5.1 million). The effect of changes in balances related to investment dealer activities will vary

significantly on a day-to-day basis to reflect the underlying business activities undertaken in that period. Cash flows from

period to period resulting from these types of transactions may not necessarily reflect any meaningful change in the

Corporation’s financial position, or that of its subsidiaries.


Operating activities:

Adjusted net loss* (79,786)$ (30,929)$

Changes in balances relating to investment dealer activities (30,085) (5,110)

Changes in agricultural inventory 27,705 14,247

Changes in other working capital amounts 16,108 (23,339)

Changes in income taxes (12,055) 30,500

Cash used in operating activities (78,113)$ (14,631)$


Significant Cash Flows – Investing Activities

Cash required or derived from trading in the Corporation’s investment portfolio, including equity accounted investments,

will vary from period to period and is dependent on trading activity and strategies that may evolve in response to global

market conditions or otherwise. During the nine months ended September 30, 2015, the Corporation generated net cash of

$148.8 million from trading in its investment portfolio (nine months ended September 30, 2014 – $155.2 million).

During the nine months ended September 30, 2015, the Corporation invested $15.9 million into its resource properties,

compared with $143.5 million invested in the same period of the prior year. Reduced expenditures related to the

Corporation’s resource properties reflect the curtailment of expenditures in response to current economic conditions and

volatility in the price of oil and natural gas.

The net investment in livestock and agricultural assets during the nine months ended September 30, 2015 was $33.7 million,

compared with $12.0 million in the same period of the prior year.

During the nine months ended September 30, 2015, the Corporation received net proceeds of $24.0 million from the sale of

certain assets, including the operations of Commonwealth, Emma Farms and Owl Creek. In the first nine months of the

prior year, cash increased by $2.8 million as a result of business combinations completed during that period.

Significant Cash Flows – Financing Activities

Net amounts repaid against credit facilities available to the Corporation and to its subsidiaries during the nine months ended

September 30, 2015 were $6.9 million (nine months ended September 30, 2014 – $30.0 million drawn).

During the nine months ended September 30, 2015, the Corporation received proceeds of $11.6 million on the exercise of

employee stock options (nine months ended September 30, 2014 – $0.2 million).

During the first nine months of 2015, the Corporation paid $0.5 million (nine months ended September 30, 2014 – $10.0

million) to purchase Class A subordinate voting shares for cancellation under its normal course issuer bid.

During the nine months ended September 30, 2015, the Corporation paid dividends of $5.3 million (nine months ended

September 30, 2014 – $6.6 million) on outstanding Preference Shares, series 2 and Preference Shares, series 3. The

Corporation has not paid dividends on its Class A subordinate voting shares or on its common shares.


Investing activities:

Net proceeds from dispositions of portfolio investments 148,838$ 155,223$

Net investment in resource properties (15,881) (143,543)

Net investment in livestock and other agricultural assets (33,749) (12,034)

Net investment in real estate (157) (195)

Cash generated from business combinations 23,997 2,780

Other investment activities (16,846) (23,002)

Cash provided from (used in) investing activities 106,202$ (20,771)$


Financing activities:

Change in corporate debt (6,921)$ 29,843$

Issuance of Class A subordinate shares, net of issue costs 11,587 170

Acquisition of Class A subordinate shares, net of costs (536) (10,000)

Dividends paid on Preference Shares, series 2 and Preference Shares, series 3 (5,253) (6,581)

Net cash from transactions with non-controlling interests 1,680 (5,857)

Cash provided from financing activities 557$ 7,575$


Cash Requirements

The Corporation’s capital management and funding objectives include ensuring that the Corporation is compliant with all of its

ongoing obligations, including compliance with all applicable debt covenants, and ensuring that the Corporation is able to meet

its financial obligations as they become due. In determining its capital allocation, the Corporation considers relevant regulatory

capital requirements in order to effectively manage its capital markets business, and resources required for the development of

resource, agricultural and real estate opportunities. The Corporation’s capital management objectives also include ensuring that it

has sufficient capital available to benefit from acquisitions and other opportunities, should they arise, and ensuring adequate

returns for shareholders. The Corporation regularly assesses the allocation of its capital resources in response to changing

economic conditions.

The Corporation’s intention is to meet short-term liquidity requirements through funds from operations, working capital reserves

and operating debt facilities. In addition, the Corporation anticipates that its operations will continue to provide the cash

necessary to fund expenses and debt service requirements. Capital may also be generated through dispositions of investments as

the Corporation repositions its investment portfolio in a manner consistent with its stated strategy to maintain a conservative level

of debt, while ensuring that sufficient capital is available to execute the Corporation’s business plan at all times.

On a consolidated basis, the Corporation believes that operating cash flow, combined with available lines of credit and its

portfolio of investments provide sufficient resources for the Corporation to conduct its operations for the foreseeable future,

including supporting the capital requirements of its regulated subsidiaries, funding the payment of dividends and interest

payments on preference shares and debt obligations, and supporting subsidiaries in order to remedy excess leverage situations, if

the need arises. On an ongoing basis, the Corporation may also require cash to develop its energy, resource, agricultural and real

estate initiatives or to invest in other opportunities, including growth opportunities related to its portfolio of investments. If

required, the Corporation may consider alternative financing options for certain investment initiatives, including possible debt or

equity issuances.



Three months ended September 30, 2015 compared with the three months ended September 30, 2014

Consolidated Net Earnings

During the third quarter of 2015, the Corporation incurred a net loss attributable to owners of Dundee Corporation of $235.9

million, representing a loss per share of $4.05. Included in the third quarter of 2015 results is the impairment of $132.9 million

relating to the Corporation’s investment in UHIC, net of the non-controlling shareholders’ share of the associated impairment in

the underlying asset.

After adjusting for the impairment as outlined previously, the net loss during the third quarter of 2015 attributable to owners of

Dundee Corporation was $103.0 million or a loss of $1.78 per share. This compares with a net loss of $78.7 million or $1.44 per

share incurred during the third quarter of the prior year. Consistent with year-to-date results, the net loss reflects the effect of

changes in the market value of the Corporation’s portfolio of investments at FVTPL, which depreciated by approximately $90.7

million during the third quarter of the current year, including $57.6 million related to the Corporation’s investment in DREAM.


Before Impairment Impairment Total Total

Net loss before income taxes from:

Goodman & Company, Investment Counsel Inc. (933) - (933) (166)

Dundee Securities Ltd. (9,992) - (9,992) (7,218)

Dundee Energy Limited (2,709) - (2,709) (359)

United Hydrocarbon International Corp. (8,348) (215,156) (223,504) (2,024)

Dundee Sustainable Technologies Inc. (1,443) - (1,443) (2,498)

Eurogas International Inc. (175) - (175) (221)

Blue Goose Capital Corp. (1,304) - (1,304) (1,708)

AgriMarine Holdings Inc. (6,099) - (6,099) (2,671)

Dundee 360 Real Estate Corporation (4,011) - (4,011) (3,023)

(35,014) (215,156) (250,170) (19,888)

Adjusted for the corporation and portfolio segment:

Changes in the market value of investments:

Dundee Precious Metals Inc. (12,769) - (12,769) -

DREAM Unlimited Corporation (57,552) - (57,552) (42,840)

Other portfolio investments (20,344) - (20,344) (38,406)

Share of loss from equity accoutned investments (7,358) - (7,358) (4,781)

Other items in the corporate and portfolio segment 702 - 702 7,716

Income tax recovery 22,112 - 22,112 16,637

Net loss for the period (110,223)$ (215,156)$ (325,379)$ (81,562)$

Net loss attributable to:



(110,223)$ (215,156)$ (325,379)$ (81,562)$


Segmented Results of Operations

DUNDEE SECURITIES LTD.


The Capital Markets Division


Investment banking revenue, including revenue from new issues and advisory services fees, was $3.9 million in the three months

ended September 30, 2015, a 59% decrease from the $9.5 million of revenue earned in the same period of the prior year. New

issue financings generated revenue of $2.4 million during the three months ended September 30, 2015, a decrease of 47% from

the $4.5 million earned in the same period of the prior year as subdued commodity prices and uncertain economic conditions

continued to suppress capital market activity. Consistent with volatility in advisory fee revenue on a year-to-date basis, during

the three months ended September 30, 2015, Dundee Securities earned advisory fees of $1.5 million, compared with $5.0 million

in the same period of the prior year.

Commission revenue decreased by 43% during the three months ended September 30, 2015 to $3.1 million, compared with $5.4

million earned in the same period of the prior year, consistent with restrained industry-wide trading activity.

Principal trading activities generated trading losses of $1.7 million during the three months ended September 30, 2015, compared

with $2.9 million in the same period of the prior year, reflecting decreased facilitation trading losses.


During the three months ended September 30, 2015, variable compensation expense was $3.3 million (three months ended

September 30, 2014 – $5.9 million), representing approximately 60% (three months ended September 30, 2014 – 54%) of related

financial services revenue, resulting in contribution margins of 40% (three months ended September 30, 2014 – 46%). The

decrease in contribution margin is a result of certain adjustments to the recognition of revenues completed in the prior year.

For the three months ended September 30, 2015 2014 2015 2014 2015 2014

Revenues

Management fees -$ -$ 4,485$ 3,883$ 4,485$ 3,883$

Financial services

Investment banking 3,930 9,524 - - 3,930 9,524

Commissions 3,066 5,391 4,860 6,374 7,926 11,765

Principal trading (1,734) (2,901) (832) (723) (2,566) (3,624)

Foreign exchange trading - - 200 195 200 195

Interest, dividends and other 269 (1,112) 2,719 2,448 2,988 1,336

5,531 10,902 11,432 12,177 16,963 23,079

Cost of sales

Variable compensation (3,302) (5,875) (5,608) (6,371) (8,910) (12,246)

Other items in net earnings

Depreciation (98) (135) (541) (348) (639) (483)


- direct (6,282) (6,961) (6,214) (5,938) (12,496) (12,899)

- allocated (1,450) (1,494) (3,565) (3,108) (5,015) (4,602)

Interest expense (19) (15) (19) (27) (38) (42)

Foreign exchange gain (loss) 19 (34) 124 9 143 (25)

Net loss before taxes, Dundee Securities (5,601)$ (3,612)$ (4,391)$ (3,606)$ (9,992)$ (7,218)$

Net loss before taxes, Dundee Securities attributable to:

Owners of Dundee Corporation (5,601)$ (3,612)$ (4,391)$ (3,606)$ (9,992)$ (7,218)$

Non-controlling interest - - - - - -

Net loss before taxes, Dundee Securities (5,601)$ (3,612)$ (4,391)$ (3,606)$ (9,992)$ (7,218)$

Capital Markets Retail & Other TOTAL


General & Administrative Expenses

The capital markets division incurred direct general and administrative expenses of $6.3 million during the three months ended

September 30, 2015, compared with $7.0 million incurred in the same period of the prior year due to a reduction in trade related,

promotion, travel and employment expenses partially offset by higher professional fees.

The Retail Division and Other Activities

Management Fee Revenue

Management fees earned during the three months ended September 30, 2015 increased to $4.5 million, compared with $3.9

million earned in the same period of the prior year. Management fees and commissions were only partially impacted in the

quarter by advisor departures as the reduction in AUA and AUM occurred in late August 2015.


Commission revenue decreased by 24% during the three months ended September 30, 2015 to $4.9 million, compared with $6.4

million earned in the same period of the prior year.

Principal trading activities generated trading losses of $0.8 million during the three months ended September 30, 2015, compared

with $0.7 million in the same period of the prior year, reflecting decreased revenues from the portfolio of trading securities.


Variable compensation expense was $5.6 million in the three months ended September 30, 2015, compared with $6.4 million in

the same period of the prior year, representing approximately 63% (three months ended September 30, 2014 – 63%) of related

financial services and management fee revenue, resulting in contribution margins of 37% (three months ended September 30,

2014 – 37%). The current quarter’s variable compensation reflects the higher compensation levels that are inherent in the

acquisition of new retail advisors as well as the effect of reduced compensation as a result of principal trading activity.

General & Administrative Expenses

The retail and other division incurred general and administrative expenses of $6.2 million during the three months ended

September 30, 2015, compared with $5.9 million incurred in the same period of the prior year. The increase is primarily due to

increased employment costs attributable to divisional restructuring. Allocated expenses increased to $3.6 million from $3.1

million in the same period of the prior year.


DUNDEE ENERGY LIMITED

During the quarter ended September 30, 2015, Dundee Energy incurred a net loss of $1.8 million attributable to owners of

Dundee Corporation. This compares to a net loss attributable to owners of Dundee Corporation of $0.2 million incurred during

the same period of the prior year.


During the third quarter of 2015, sales of oil and natural gas, net of royalty interests, generated revenues of $6.4 million, a

decrease of $2.2 million from revenues of $8.6 million earned during the same period of the prior year. The effect of lower

commodity prices decreased revenues by approximately $2.3 million although, consistent with year-to-date results, these

decreases were partially offset by increased production volumes, which increased revenues by $0.1 million.

Field Level Cash Flows and Field Netbacks

Field level cash flows in the third quarter of 2015, before realized price risk management arrangements, were $2.0 million, a 51%

decrease from field level cash flows of $4.1 million generated in the third quarter of the prior year. Lower realized prices from

sales of both oil and natural gas decreased field netbacks in the third quarter of 2015 to $8.80/boe, compared with $18.02/boe

earned in the third quarter of the prior year.


Revenues

Oil and gas sales 6,400$ 8,574$


6,495 8,722

Cost of sales

Production expenditures (4,380) (4,443)



General and administrative (952) (1,460)

Gain on derivative financial instruments - 376

Interest expense (1,096) (889)


Net loss before taxes, Dundee Energy Limited (2,709)$ (359)$

Net loss before taxes, Dundee Energy Limited attributable to:

Owners of Dundee Corporation (1,796)$ (204)$


Net loss before taxes, Dundee Energy Limited (2,709)$ (359)$



Total sales 4,481$ 3,061$ 7,542$ 5,102$ 5,012$ 10,114$

Royalties (672) (470) (1,142) (773) (767) (1,540)

Production expenditures (2,935) (1,445) (4,380) (2,669) (1,774) (4,443)

874 1,146 2,020 1,660 2,471 4,131

Loss on derivative financial instruments - - - - (126) (126)

Field level cash flows 874$ 1,146$ 2,020$ 1,660$ 2,345$ 4,005$



$/Mcf $/bbl $/boe $/Mcf $/bbl $/boe

Total sales 4.17$ 60.66$ 32.85$ 4.72$ 101.83$ 44.10$

Royalties (0.63) (9.31) (4.97) (0.72) (15.58) (6.71)

Production expenditures (2.73) (28.63) (19.08) (2.47) (36.03) (19.37)

0.81 22.72 8.80 1.53 50.22 18.02

Loss on derivative financial instruments - - - - (2.56) (0.55)

Field netbacks 0.81$ 22.72$ 8.80$ 1.53$ 47.66$ 17.47$


Realized losses resulting from Dundee Energy’s price risk management arrangements reduced field netbacks in the third quarter

of 2014 by $0.55/boe. Dundee Energy did not have any price risk management arrangements outstanding during the third quarter

of 2015.

BLUE GOOSE CAPITAL CORP.

During the third quarter of 2015, Blue Goose incurred a net loss attributable to owners of Dundee Corporation of $1.1 million,

compared with a net loss attributable to owners of Dundee Corporation of $1.5 million in the same period of the prior year.

Revenues in the third quarter of 2015 were $14.0 million, a $5.8 million or 29% decrease from revenues of $19.8 million in the

third quarter of the prior year. Consistent with year-to-date results, the decrease reflects the streamlining of cattle operations out

of northern Ontario and the United States, as well as the exiting of non-profitable SKUs associated with chicken sales.

During the third quarter of 2015, Blue Goose generated a contribution margin of $1.5 million or 10.3% on revenue of $14.0

million. This compares to a contribution margin of $1.1 million or 5.3% on revenue of $19.8 million for the same quarter of

2014. By exiting unprofitable SKUs and making operational changes to reduce costs, Blue Goose has been able to increase its

contribution margin, despite lower sales volumes due to the planned exit from unprofitable SKUs. Late in the third quarter, Blue

Goose launched new consumer packaged goods, which should contribute higher chicken revenue and contribution margins in the

future. Blue Goose’s cattle operations currently sell all its available product and is looking to grow-out its herd to expand

revenues in the future.

Unit sales of livestock sold during the third quarter of 2015 are illustrated in the table below.


Revenues

Sales 14,031$ 19,785$


14,122 20,434

Cost of sales (16,896) (22,781)


Depreciation and depletion (762) (696)


Fair value changes in livestock 4,312 4,046


Foreign exchange loss - (2)


Net loss before taxes, Blue Goose Capital Corp. attributable to:





Cost of Fair Value Cost of Fair Value

Components of Agriculture Products Revenue Sales Changes Margin % Margin Revenue Sales Changes Margin % Margin

Beef 3,813$ 5,851$ 3,492$ 1,454$ 38.1% 3,924$ 5,305$ 1,575$ 194$ 4.9%

Chicken 2,898 2,972 - (74) (2.6%) 5,328 6,454 - (1,126) (21.1%)

Fish 1,115 2,111 820 (176) (15.8%) 805 2,231 2,471 1,045 129.8%

Feed 6,205 5,962 - 243 3.9% 7,766 7,521 - 245 3.2%

Other - - - - n/a 1,962 1,270 - 692 35.3%

14,031$ 16,896$ 4,312$ 1,447$ 10.3% 19,785$ 22,781$ 4,046$ 1,050$ 5.3%

Unit sales for the three months ended September 30, 2015 2014

Beef (kgs) 625,624 691,744

Chicken (kgs) 317,180 831,950

Consumer packaged goods (cases) 185 6,102

Fish (lbs) 449,044 235,645


Chicken sales volumes are significantly lower for the third quarter of 2015, compared with the same quarter of the previous year

as Blue Goose chose to exit unprofitable SKUs. Blue Goose has also exited many of its unprofitable consumer packaged goods

SKUs, and is currently in the process of relaunching this program. The fish division has focused on selling whole fish and

moving away from further processing its harvest, resulting in higher unit sales with lower average revenue per pound.

AGRIMARINE HOLDINGS INC.

During the third quarter of 2015, AgriMarine incurred a net loss of $6.1 million attributable to owners of Dundee Corporation.

The third quarter loss in the current year includes a depreciation charge of $4.5 million relating to certain capital assets that the

Corporation has determined have limited future value. After adjusting for this accelerated depreciation, AgriMarine’s net loss for

the third quarter of 2015 was $1.6 million, compared with a net loss of $2.5 million in the third quarter of the prior year.

CONTRIBUTION MARGINS

During the quarter ended September 30, 2015, AgriMarine generated a contribution margin of $0.3 million on sales of $2.1

million, before adjusting for changes in the fair value of livestock and writedowns of biological assets. The volume of fish sold

in the quarter was 268,000 kilograms, compared with 238,000 kilograms in the same period of the prior year.

During the third quarter of 2015, AgriMarine recorded a writedown of $0.6 million at its West Coast Fishculture site related to

extraordinary livestock mortalities caused by difficult weather conditions and operational challenges. During the same period of

the prior year, AgriMarine had a $1.2 million writedown of its biological assets and inventory, largely due to mortalities of

salmon at its net pen fish farming sites, resulting from unusually high surface water temperatures. AgriMarine continues to

install new infrastructure and technologies to reduce the mortality rates on a go-forward basis.

A further writedown of $0.5 million was recorded in the third quarter of 2015, relating to AgriMarine’s operations in China, to

reflect the value that AgriMarine will realize on the wind up of its operations at this site.


Revenues

Sales of livestock 2,073$ 1,626$

Interest, dividends and other 53 -

2,126 1,626

Cost of sales (2,848) (2,748)


Depreciation and depletion (4,523) -






Net loss before taxes, AgriMarine Holdings Inc. attributable to:


Non-controlling interest - (134)



Revenues 2,073$ 1,626$

Cost of sales (1,795) (1,512)

Contribution margin before fair value changes and writedowns 278 114


Writedowns (1,053) (1,236)

(508)$ (1,549)$


DUNDEE 360 REAL ESTATE CORPORATION

During the three months ended September 30, 2015, Dundee 360 incurred a net loss attributable to the owners of Dundee

Corporation of $3.9 million, compared with a net loss attributable to the owners of Dundee Corporation of $3.0 million incurred

in the same period of the prior year. Operating losses include $2.5 million (third quarter of 2014 – $2.9 million) of depreciation

related to intangibles obtained as part of the acquisition of control of Dundee 360 in July 2014. Operating losses in the third

quarter of the current year include $0.7 million of severance costs related to cost-savings initiatives undertaken by Dundee 360.

Gross commission revenues for the listing, marketing and selling of real estate assets during the third quarter of 2015 were $21.0

million, compared with $20.9 million in the same period of the prior year. Commissions paid to associated brokers and agents in

respect of this revenue stream were $19.2 million during this period, providing Dundee 360 with a contribution margin of $1.8

million or 9%, comparable to the same period of the prior year. In addition, Dundee 360 earned $2.4 million of other revenue

(third quarter of 2014 – $2.1 million) consisting primarily of fees paid by its network of brokers and agents for the provision of

marketing, administrative and support services.

As a result of the termination of the contract with Ivanhoé Cambridge in the first quarter of 2015, revenues from hospitality and

asset management activities declined to $0.7 million in the third quarter of 2015, compared with $1.8 million earned in the same

period of the prior year.


For the three months ended September 30, 2015 Marketing Asset Management Developments Other Total

Revenues


Consulting and management fees - 656 1,571 - 2,227


Other revenue 2,411 - 7 21 2,439

Interest, dividends and other (14) 39 (37) (227) (239)

23,424 695 1,541 (206) 25,454

Cost of sales (19,161) - - - (19,161)


Depreciation and depletion (296) (149) (1,957) (53) (2,455)

General and administrative (3,682) (715) (1,901) (1,744) (8,042)


Finance expense 32 - - - 32

Net (loss) earnings before taxes, Dundee 360 Real Estate Corporation 317$ (169)$ (2,156)$ (2,003)$ (4,011)$


Owners of Dundee Corporation 317$ (169)$ (2,083)$ (2,003)$ (3,938)$


Net (loss) earnings before taxes, Dundee 360 Real Estate Corporation 317$ (169)$ (2,156)$ (2,003)$ (4,011)$


For the three months ended September 30, 2014 Marketing Asset Management Developments Other Total

Revenues


Consulting and management fees - 1,796 1,300 - 3,096


Other revenue 2,120 - 5 1 2,126

Interest, dividends and other 10 (2) 25 (112) (79)

23,672 1,794 1,330 (111) 26,685

Cost of sales (19,228) - - - (19,228)


Depreciation and depletion (471) (388) (2,013) (8) (2,880)

General and administrative (3,480) (680) (1,462) (2,065) (7,687)


Finance expense - - - - -

Net (loss) earnings before taxes, Dundee 360 Real Estate Corporation 493$ 726$ (2,058)$ (2,184)$ (3,023)$


Owners of Dundee Corporation 493$ 726$ (2,035)$ (2,184)$ (3,000)$


Net (loss) earnings before taxes, Dundee 360 Real Estate Corporation 493$ 726$ (2,058)$ (2,184)$ (3,023)$


Consulting and management fee revenues earned from real estate development activities totalled $1.5 million in the third quarter

of 2015, compared with revenues of $1.3 million earned in the same period of the prior year. Current period revenues include

$0.7 million of fees earned on the Parq Resort and Casino project, which is expected to increase in subsequent quarters as the

construction accelerates and higher construction costs are incurred, $0.5 million of fees earned for the project management and

procurement services and $0.3 million from fees earned on development of Edenarc 1800.

CONSOLIDATED QUARTERLY BUSINESS TRENDS

Operating results during the third quarter of 2015 include an impairment charge of $215.2 million against resource

properties associated with the Corporation’s investment in UHIC. The impairment charge is partially offset by a $56.5

million adjustment charge relating to amounts otherwise receivable from non-controlling shareholders of UHIC.

Included in net earnings or losses are amounts reflecting changes in the fair value of the Corporation’s direct investments in

public and private securities. As previously noted, changes in the fair value of investments are determined by equity and

credit markets and are expected to result in significant fluctuations in net earnings or loss. The Corporation believes that

equity and credit markets do not necessarily correctly reflect the underlying value of certain assets. As a consequence,

management of the Corporation believes that the amount of unrealized gains or losses that will be included in net earnings or

loss in any given period typically provides little analytical or predictive value to the readers of the Corporation’s financial

information.

The Corporation’s share of earnings or losses from equity accounted investments is included in the Corporation’s net

earnings or loss for each quarter. As with changes in the fair value of the Corporation’s investment portfolio, earnings or

losses from each equity accounted investee and dilution gains and losses from these investments will fluctuate from period

to period and may depend on market forces or other operating conditions that are not necessarily under the Corporation’s

direct control.

OFF-BALANCE SHEET ARRANGEMENTS, COMMITMENTS AND CONTINGENCIES

Other than as disclosed elsewhere in this MD&A or in note 32 to the September 2015 Interim Consolidated Financial Statements,

there have been no significant changes in the nature of commitments, contingencies and off-balance sheet arrangements, from

those described in note 34 to the 2014 Audited Consolidated Financial Statements and under “Off-Balance Sheet Arrangements”

and “Commitments and Contingencies” on pages 50 through 52 in the Corporation’s MD&A as at and for the year ended

December 31, 2014.

RELATED PARTY TRANSACTIONS

Other than as described in note 33 to the September 2015 Interim Consolidated Financial Statements, there have been no

significant changes in the nature and scope of related party transactions to those described in note 35 to the 2014 Audited

Consolidated Financial Statements and the accompanying MD&A.

ACCOUNTING POLICIES AND CRITICAL ACCOUNTING ESTIMATES

The preparation of the Corporation’s consolidated financial statements in conformity with IFRS requires management to make

estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and other items in net earnings or loss

and the related disclosure of contingent assets and liabilities. Critical accounting estimates represent estimates made by

management that are, by their very nature, uncertain. The Corporation evaluates its estimates on an ongoing basis. Such

2015 2014 2013

For the three months ended 30-Sept 30-Jun 31-Mar 31-Dec 30-Sept 30-Jun 31-Mar 31-Dec

Net (loss) earnings attributable to owners of the parent (235,898)$ (141,266)$ (27,026)$ (178,224)$ (78,655)$ (29,698)$ (31,843)$ 20,667$

(Loss) earnings per share

Basic (4.05)$ (2.44)$ (0.50)$ (3.20)$ (1.44)$ (0.59)$ (0.63)$ 0.34$

Diluted (4.05)$ (2.44)$ (0.50)$ (3.20)$ (1.44)$ (0.59)$ (0.63)$ 0.33$


estimates are based on historical experience and on various other assumptions that the Corporation believes are reasonable under

the circumstances, and these estimates form the basis for making judgments about the carrying value of assets and liabilities and

the reported amount of revenues and other items in net earnings that are not readily apparent from other sources. Actual results

may differ from these estimates under different assumptions or conditions. A summary of the more significant judgments and

estimates made by management in the preparation of its financial information is provided in note 4 to the 2014 Audited

Consolidated Financial Statements. There have been no changes in the accounting policies adopted in the preparation of the

Corporation’s September 2015 Interim Consolidated Financial Statements from those detailed in note 3 to the Corporation’s 2014

Audited Consolidated Financial Statements.

CONTROLS AND PROCEDURES

In accordance with the Canadian Securities Administrators’ National Instrument 52-109, the Corporation has filed certificates

signed by its Chief Executive Officer and the Chief Financial Officer certifying that, among other things, the design of disclosure

controls and procedures and the design of internal control over financial reporting are adequate as at September 30, 2015.

Disclosure controls and procedures are designed to ensure that information required to be disclosed by the Corporation in the

reports it files or submits under securities legislation is recorded, processed, summarized and reported on a timely basis and that

such information is accumulated and reported to management, including the Corporation’s Chief Executive Officer and Chief

Financial Officer, as appropriate, to allow required disclosures to be made in a timely fashion. Based on their evaluation, the

Chief Executive Officer and Chief Financial Officer concluded that as at September 30, 2015, the Corporation’s disclosure

controls and procedures were effective.

The Chief Executive Officer and the Chief Financial Officer of the Corporation have also assessed whether there were any

changes to the Corporation’s internal control over financial reporting during the nine months ended September 30, 2015 that have

materially affected, or are reasonably likely to materially affect the Corporation’s internal control over financial reporting. There

were no changes identified during their assessment.

MANAGING RISK

Except as otherwise disclosed in this MD&A, there have been no significant changes to the nature and scope of the risks faced by

the Corporation as described in the Corporation’s 2014 Annual Information Form under “Risk Factors” which is available on

SEDAR at www.sedar.com. These business risks should be considered by interested parties when evaluating the Corporation’s

performance and its outlook.

CAUTIONARY NOTE REGARDING FORWARD LOOKING STATEMENTS

Dundee Corporation’s public communications may include written or oral forward looking statements. Statements of this type

are included in this MD&A, and may be included in other filings with the Canadian regulators, stock exchanges or in other

communications. All such statements constitute forward looking information within the meaning of securities law and are made

pursuant to the “safe harbour” provisions of applicable securities laws. Forward looking statements may include, but are not

limited to, statements about anticipated future events or results including comments with respect to the Corporation’s objectives

and priorities for 2015 and beyond, and strategies or further actions with respect to the Corporation, its products and services,

business operations, financial performance and condition. Forward looking statements are statements that are predictive in

nature, depend upon or refer to future events or conditions or include words such as “expects”, “anticipates”, “intends”, “plans”,

“believes”, “estimates” or similar expressions concerning matters that are not historical facts. Such statements are based on

current expectations of the Corporation’s management and inherently involve numerous risks and uncertainties, known and

unknown, including economic factors and those affecting the financial services, energy, resources, agriculture and real estate

industries generally. The forward looking information contained in this MD&A is presented for the purpose of assisting

shareholders in understanding business and strategic priorities and objectives as at the periods indicated and may not be

appropriate for other purposes.

A number of risks, uncertainties and other factors may cause actual results to differ materially from the forward looking

statements contained in this MD&A, including, among other factors, those referenced in the section entitled “Risk Factors” in the

http://www.sedar.com/


Corporation’s Annual Information Form, which include, but are not limited to, general economic and market conditions; the

Corporation’s ability to execute strategic plans and meet financial obligations; the performance of the Corporation’s principal

subsidiaries; the Corporation’s ability to raise additional capital; the Corporation’s ability to create, attract and retain AUM and

AUA; risks relating to trading activities and investments; competition faced by the Corporation; regulation of the Corporation’s

businesses; successful integration of the Corporation with acquired businesses and the realization of any anticipated synergies;

risks associated with the Corporation’s operating businesses and the Corporation’s investment holdings in general, including risks

associated with oil and gas and mining exploration, development and production activities, environmental risks, inflation,

changes in interest rates, commodity prices and other financial exposures; the availability and adequacy of insurance coverage for

the Corporation and its subsidiaries; maintenance of minimum regulatory capital requirements for certain of the Corporation’s

subsidiaries; potential liability of the Corporation and its subsidiaries under securities laws and for violations of investor

suitability requirements; and the ability of the Corporation and its subsidiaries to attract and retain key personnel. The preceding

list is not exhaustive of all possible risk factors that may influence actual results, and is compiled based upon information

available as at November 12, 2015.

Forward looking statements contained in this MD&A are based upon assumptions about the future performance of the Canadian,

European and United States economies, which were material factors considered by management when setting Dundee

Corporation’s strategic priorities and objectives. In determining expectations for economic growth in the financial services,

energy, resource, agriculture and real estate sectors, the Corporation considered historical economic data provided by the

Canadian government and its agencies, and market and general economic conditions, which factors are unpredictable and may

impact the Corporation’s performance.

Forward looking statements contained in this MD&A are not guarantees of future performance and, while forward looking

statements are based on certain assumptions that the Corporation considers reasonable, actual events and results could differ

materially from those expressed or implied by forward looking statements made by the Corporation. Prospective investors are

cautioned to consider these and other factors carefully when making decisions with respect to the Corporation and not place

undue reliance on forward looking statements. Circumstances affecting the Corporation may change rapidly. Except as may be

required by applicable law, the Corporation does not undertake any obligation to update publicly or revise any such forward

looking statements, whether as a result of new information, future events or otherwise.

INFORMATION CONCERNING DUNDEE CORPORATION

Additional information relating to Dundee Corporation, including a copy of the Corporation’s Annual Information Form, may be

found on SEDAR at www.sedar.com and the Corporation’s website at www.dundeecorp.com.

Toronto, Ontario

November 12, 2015

http://www.sedar.com/

http://www.dundeecorp.com/


DUNDEE CORPORATION

CONDENSED INTERIM CONSOLIDATED STATEMENTS OF

FINANCIAL POSITION

(Unaudited)

(expressed in thousands of Canadian dollars)

The accompanying notes are an integral part of these unaudited condensed interim consolidated financial statements.

Commitments, contingencies and off-balance sheet arrangements (note 32)

As at

Note September 30, 2015 December 31, 2014

ASSETS

Cash 274,449$ 245,803$

Accounts receivable 51,813 58,447

Income taxes receivable 10,538 -

Client accounts receivable 6 935,867 552,636

Derivative financial instruments 7 - 341

Brokerage securities owned 8 60,082 43,800

Investments 9 479,802 653,696

Equity accounted investments 10 170,248 362,000

Real estate joint venture investments 11 9,985 7,762

Real estate assets 12 14,263 13,209

Resource properties 13 396,573 557,317

Livestock 14 40,578 39,711

Capital and other assets 15 193,966 248,266

Goodwill 16 14,117 14,117

Deferred income tax assets 27 28,098 -

TOTAL ASSETS 2,680,379$ 2,797,105$

LIABILITIES

Accounts payable and accrued liabilities 100,310$ 118,523$

Client deposits and related liabilities 17 1,039,211 671,467

Brokerage securities sold short 8 12,296 11,023

Income taxes payable - 1,530

Corporate debt 18 194,327 213,639

Decommissioning liabilities 19 60,628 59,233

Preference Shares, series 4 20 106,852 106,665

Deferred income tax liabilities 27 - 40,160

1,513,624 1,222,240

SHAREHOLDERS' EQUITY

Share capital

Common shares 21 281,639 252,128



Contributed surplus 19,974 24,390

Retained earnings 640,437 1,050,141

Accumulated other comprehensive income 21 68,538 23,454

1,137,656 1,477,181

NON-CONTROLLING INTEREST 22 29,099 97,684

1,166,755 1,574,865

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 2,680,379$ 2,797,105$

SEPTEM BER 2015 – DUNDEE CORPORAT I ON 53

DUNDEE CORPORATION

CONDENSED INTERIM CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

(expressed in thousands of Canadian dollars, except for per share amounts)



Note September 30, 2015 September 30, 2014 September 30, 2015 September 30, 2014

REVENUES 23 66,409$ 85,897$ 219,276$ 240,542$

OTHER ITEMS IN NET LOSS

Cost of sales 24 (52,195) (61,446) (154,616) (157,766)

Depreciation and depletion 13, 15 (228,275) (7,574) (264,927) (22,036)

General and administrative 26 (42,438) (36,744) (149,548) (101,588)

Net loss from investments 9 (90,665) (81,246) (241,810) (108,389)

Share of loss from equity accounted investments 10, 11 (7,358) (4,781) (5,634) (27,101)

Gain on sale of equity accounted investments 10 - 6,714 - 6,714

Fair value changes in livestock 14 4,579 3,619 12,770 10,573

(Loss) gain on derivative financial instruments 7 - 376 - (416)

Interest expense 18, 19 (3,843) (3,432) (12,734) (11,665)

Foreign exchange gain 6,295 418 10,610 537

NET LOSS BEFORE INCOME TAXES (347,491) (98,199) (586,613) (170,595)

Income tax recovery 27 22,112 16,637 73,331 16,329

NET LOSS FOR THE PERIOD (325,379)$ (81,562)$ (513,282)$ (154,266)$

NET LOSS ATTRIBUTABLE TO:



(325,379)$ (81,562)$ (513,282)$ (154,266)$

NET LOSS PER SHARE 28

Basic and diluted (4.05)$ (1.44)$ (7.03)$ (2.68)$


DUNDEE CORPORATION


COMPREHENSIVE (LOSS) INCOME

(Unaudited)




September 30, 2015 September 30, 2014 September 30, 2015 September 30, 2014

NET LOSS FOR THE PERIOD (325,379)$ (81,562)$ (513,282)$ (154,266)$

Other comprehensive income:

Items that may be reclassified to net loss

Unrealized gain from foreign currency translation 35,615 13,897 62,096 12,057

Share of other comprehensive income from equity accounted investments, 4,384 13,177 28,716 14,535

net of associated taxes (1,161) (3,491) (7,254) (3,866)

Transfer of unrealized other comprehensive income from equity

accounted investments to net loss, - (32) - (32)

net of associated taxes - 8 - 8

Total other comprehensive income for the period 38,838 23,559 83,558 22,702

COMPREHENSIVE LOSS FOR THE PERIOD (286,541)$ (58,003)$ (429,724)$ (131,564)$

COMPREHENSIVE LOSS ATTRIBUTABLE TO:


Non-controlling interest (67,154) 5,537 (70,618) (5,773)

(286,541)$ (58,003)$ (429,724)$ (131,564)$


DUNDEE CORPORATION


CHANGES IN SHAREHOLDERS’ EQUITY

(Unaudited)



Accumulated

Number of Preference Preference Other

Common Common Shares, Shares, Contributed Retained Comprehensive Non-controlling

Note Shares Shares Series 2 Series 3 Surplus Earnings Income (Loss) Interest Total

Balance, December 31, 2013 54,106,401 208,435$ 127,068$ -$ 2,985$ 1,384,456$ (1,872)$ 106,753$ 1,827,825$


Net loss - - - - - (140,196) - (14,070) (154,266)

Other comprehensive income - - - - - - 14,405 8,297 22,702

Shares issued in a business combination 21 2,779,983 45,541 - - - - - - 45,541

Acquisition of Class A subordinate shares for cancellation 21 (615,000) (2,465) - - - (7,535) - - (10,000)

Issuance of Class A subordinate shares for non-cash consideration 21 3,003 53 - - - - - - 53

Issuance of Class A subordinate shares for cash 21 3,002 52 - - - - - - 52

Conversion of Preference Shares, series 2 to series 3 20 - - (43,015) 43,015 - - - - -

Dividends on Preference Shares, series 2 - - - - - (6,581) - - (6,581)

Stock based compensation - - - - 1,331 - - - 1,331

Exercise of options 21 22,714 342 - - (33) - - - 309

Changes of ownership interest in subsidiaries 5 - - - - 19,003 - - 5,338 24,341

Balance, September 30, 2014 56,300,103 251,958 84,053 43,015 23,286 1,230,144 12,533 106,318 1,751,307

From October 1, 2014 to December 31, 2014

Net loss - - - - - (178,224) - (16,138) (194,362)


Issuance of Class A subordinate shares for non-cash consideration 21 1,172 17 - - - - - - 17

Issuance of Class A subordinate shares for cash 21 1,173 18 - - - - - - 18


Dividends on Preference Shares, series 3 - - - - - (542) - - (542)

Stock based compensation - - - - 238 - - - 238

Exercise of options 9,045 135 - - (21) - - - 114

Changes of ownership interest in subsidiaries - - - - 887 - - (363) 524

Balance, December 31, 2014 56,311,493 252,128 84,053 43,015 24,390 1,050,141 23,454 97,684 1,574,865


Net loss - - - - - (404,190) - (109,092) (513,282)


Acquisition of Class A subordinate shares for cancellation 21 (55,000) (275) - - - (261) - - (536)



Stock based compensation 21 301,433 3,536 - - 57 - - - 3,593

Exercise of options 21 2,089,107 26,250 - - (3,655) - - - 22,595

Changes of ownership interest in subsidiaries 5 - - - - (818) - - 2,033 1,215

Balance, September 30, 2015 58,647,033 281,639$ 84,053$ 43,015$ 19,974$ 640,437$ 68,538$ 29,099$ 1,166,755$

Attributable to Owners of the Parent


DUNDEE CORPORATION

CONDENSED INTERIM CONSOLIDATED STATEMENTS OF CASH FLOW

(Unaudited)



For the nine months ended

Note September 30, 2015 September 30, 2014

OPERATING ACTIVITIES:

Net loss for the period (513,282)$ (154,266)$

Adjusted for:

Items not affecting cash and other adjustments 29 433,496 123,337

Changes in non-cash working capital items 29 1,673 16,298

CASH USED IN OPERATING ACTIVITIES (78,113) (14,631)

INVESTING ACTIVITIES:

Net investment in resource properties (15,881) (143,543)

Net investment in livestock and other agricultural assets (33,749) (12,034)

Net investment in real estate (157) (195)

Cash generated from business combinations 4 23,997 2,780

Acquisitions of portfolio investments (13,725) (107,176)

Proceeds from dispositions of portfolio investments 162,563 262,399

Net investment in capital and other assets (16,846) (23,002)

CASH PROVIDED FROM (USED IN) INVESTING ACTIVITIES 106,202 (20,771)

FINANCING ACTIVITIES:

Change in corporate debt (6,921) 29,843

Issuance of Class A subordinate shares, net of issue costs 11,587 170

Acquisition of Class A subordinate shares, net of costs 21 (536) (10,000)

Net cash from transactions with non-controlling interests 1,680 (5,857)

Dividends paid on Preference Shares, series 2 (3,711) (6,581)

Dividends paid on Preference Shares, series 3 (1,542) -

CASH PROVIDED FROM FINANCING ACTIVITIES 557 7,575

NET INCREASE (DECREASE) IN CASH DURING THE PERIOD 28,646 (27,827)

Cash, beginning of period 245,803 183,825

CASH, END OF PERIOD 274,449$ 155,998$

Cash flows include the following amounts:

Interest paid 11,931$ 10,802$

Taxes paid 11,605$ 22,115$


DUNDEE CORPORATION

NOTES TO THE CONDENSED INTERIM CONSOLIDATED

FINANCIAL STATEMENTS

(Unaudited)

For the three and nine months ended September 30, 2015 and September 30, 2014

Tabular dollar amounts in thousands of Canadian dollars, except per share amounts

1 . N A T U R E O F O P E R A T I O N S

Dundee Corporation (the “Corporation” or “Dundee Corporation”) is a public Canadian independent holding company,

listed on the Toronto Stock Exchange (“TSX”) under the symbol “DC.A”. Through its operating subsidiaries, the

Corporation is engaged in diverse business activities in the areas of investment advisory, corporate finance, energy,

resources, agriculture, real estate and infrastructure. The Corporation also holds, directly and indirectly, a portfolio of

investments mostly in these key areas, as well as other select investments in both publicly listed and private enterprises.

The Corporation is incorporated under the Business Corporations Act (Ontario) and is domiciled in Canada. The

Corporation’s head office is located at 1 Adelaide Street East, 21st Floor, Toronto, Ontario, Canada, M5C 2V9. At

September 30, 2015 and December 31, 2014, the Corporation’s major operating subsidiaries included:

(i) The Corporation acquired control of AgriMarine Holdings Inc. on July 3, 2014, at which time the Corporation began to fully

consolidate the operating results of AgriMarine Holdings Inc.

(ii) The Corporation acquired control of Dundee 360 Real Estate Corporation on July 2, 2014, at which time the Corporation began to

fully consolidate the operating results of Dundee 360 Real Estate Corporation.

2 . B A S I S O F P R E P A R A T I O N

These unaudited condensed interim consolidated financial statements of the Corporation as at and for the three and nine

months ended September 30, 2015 (“September 2015 Interim Consolidated Financial Statements”) have been prepared in

accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards

Board (“IASB”), and with interpretations of the International Financial Reporting Interpretations Committee (“IFRIC”)

which the Canadian Accounting Standards Board has approved for incorporation into Part 1 of the CPA Canada Handbook –

Accounting, as applicable to the preparation of interim financial statements, including International Accounting Standard

(“IAS”) 34, “Interim Financial Reporting”. The September 2015 Interim Consolidated Financial Statements should be read

in conjunction with the Corporation’s audited consolidated financial statements as at and for the year ended December 31,

2014 (“2014 Audited Consolidated Financial Statements”) which were prepared in accordance with IFRS as applicable for

annual financial statements. The September 2015 Interim Consolidated Financial Statements were authorized for issuance

by the Board of Directors on November 12, 2015.

As at and for the nine months ended As at and for the year ended

September 30, 2015 December 31, 2014

Opening Ending Opening Ending

(in alphabetical order) Ownership Ownership Ownership Ownership

AgriMarine Holdings Inc. (i) 95% 100% n/a 95%

Blue Goose Capital Corp. 87% 88% 84% 87%

Dundee 360 Real Estate Corporation (ii) 100% 100% n/a 100%

Dundee Energy Limited 58% 58% 58% 58%

Dundee Securities Ltd. 100% 100% 100% 100%

Dundee Sustainable Technologies Inc. 63% 66% 83% 63%

Goodman & Company, Investment Counsel Inc. 100% 100% 100% 100%

United Hydrocarbon International Corp. 35% 35% 29% 35%


The September 2015 Interim Consolidated Financial Statements follow the same accounting principles and methods of

application as those disclosed in note 3 to the 2014 Audited Consolidated Financial Statements. IFRS accounting standards,

interpretations and amendments to existing IFRS accounting standards that were not yet effective as at December 31, 2014,

are described in note 3 to the 2014 Audited Consolidated Financial Statements. There have been no other changes to

existing IFRS accounting standards and interpretations since December 31, 2014 that are expected to have a material effect

on the Corporation’s consolidated financial statements.

3 . C R I T I C A L A C C O U N T I N G J U D G M E N T S , E S T I M A T E S A N D A S S U M P T I O N S

The preparation of the September 2015 Interim Consolidated Financial Statements in accordance with IFRS requires the

Corporation to make judgments in applying its accounting policies and estimates and assumptions about the future. These

judgments, estimates and assumptions affect the Corporation’s reported amounts of assets, liabilities, revenues and other

items in net earnings, and the related disclosure of contingent assets and liabilities, if any. The Corporation evaluates its

estimates on an ongoing basis. Such estimates are based on historical experience and on various other assumptions that the

Corporation believes are reasonable under the circumstances, and these estimates form the basis for making judgments about

the carrying value of assets and liabilities and the reported amount of revenues and other items in net earnings that are not

readily apparent from other sources. Actual results may differ from these estimates under different assumptions or

conditions. There have been no significant changes in accounting judgments, estimates and assumptions made by the

Corporation in the preparation of the September 2015 Interim Consolidated Financial Statements from those judgments,

estimates and assumptions disclosed in note 4 to the 2014 Audited Consolidated Financial Statements.

4 . S I G N I F I C A N T A C Q U I S I T I O N S O R D I S P O S I T I O N S

Significant acquisitions or dispositions completed by the Corporation during the year ended December 31, 2014, including

asset acquisitions or dispositions and acquisitions or dispositions accounted for as business combinations, are described in

note 5 to the 2014 Audited Consolidated Financial Statements. Described below are significant acquisitions or dispositions

completed by the Corporation since December 31, 2014.

Wagyu Cattle Operations

In June 2015, the Corporation sold certain assets associated with its Wagyu cattle operations in the United States for gross

proceeds of $21,919,000. The carrying value of the assets sold, together with a summary of the consideration received and

the resulting loss on sale, are illustrated in the following table.

The $5,331,000 loss incurred on the sale of assets has been included with “General and administrative” expenses in the

September 2015 Interim Consolidated Financial Statements (note 26).

Upon completion of the sale, a subsidiary of the Corporation repaid $7,871,000 of corporate debt outstanding that was

directly related to Wagyu cattle operations (note 18).

Carrying value of net assets sold:

Capital and other assets 23,192$

Livestock 4,109

Other net liabilities (51)

27,250

Proceeds received on disposition of net assets:

Cash 21,919

21,919

Loss on sale of net assets (5,331)$


Commonwealth Aggregate Company Incorporated

In June 2015, the Corporation disposed of its indirect interest in Commonwealth Aggregate Company Incorporated

(“Commonwealth”), a subsidiary of Blue Goose Capital Corp., including its interest in the underlying aggregates business

operated through subsidiaries of Commonwealth, for total consideration of $11,894,000. The assets and liabilities of

Commonwealth were derecognized in the September 2015 Interim Consolidated Financial Statements concurrent with

completion of the sale. The carrying value of the assets and liabilities derecognized, together with a summary of the

consideration received and the resulting gain, are illustrated in the following table.

In connection with the disposition, a subsidiary of the Corporation assumed a vendor-take-back mortgage arrangement

bearing interest at 7%, and with an initial term to maturity of 2.67 years, maturing in February 2018. Amounts receivable by

the subsidiary of the Corporation pursuant to this vendor-take-back mortgage arrangement, which have been included as

“Accounts receivable” in the September 2015 Interim Consolidated Financial Statements, are secured by a general security

agreement over the assets of Commonwealth and certain of its subsidiaries, subject to a subordination to certain third-party

lenders to these companies.

The $939,000 gain recognized on the disposition of the net assets of Commonwealth has been applied to reduce “General

and administrative” expenses in the September 2015 Interim Consolidated Financial Statements (note 26).

5 . A C Q U I S I T I O N S A N D D I L U T I O N S O F I N T E R E S T S I N S U B S I D I A R I E S

Change of Ownership Interests in Subsidiaries

Pursuant to a “going-private” transaction, during the nine months ended September 30, 2015, the Corporation purchased the

5% non-controlling shareholders’ interest in AgriMarine Holdings Inc. (“AgriMarine”) that it did not already own for cash

of $180,000. The transaction was accounted for as an equity transaction and therefore, the difference between the cash paid

and the carrying value of the non-controlling interest acquired, amounting to $653,000, was recorded as an increase in

contributed surplus. Upon completion of the transaction, the Corporation held 100% of the issued and outstanding common

Carrying value of net assets sold:

Resource properties 9,955$

Capital and other assets 6,325

Deferred income tax liabilities (2,675)

Other net liabilities (2,650)

10,955

Proceeds received on disposition of net assets:

Cash 2,500

Vendor-take-back mortgage 2,000

Repayment of debt 7,394

11,894

Gain on sale of net assets 939$

Effect on Contributed Surplus

Interest Owned as at during the nine months ended

30-Sept-15 31-Dec-14 30-Sept-14 31-Dec-13 30-Sept-15 30-Sept-14

AgriMarine Holdings Inc. 100% 95% 95% n/a 653$ -$

Blue Goose Capital Corp. 88% 87% 86% 84% (132) (337)

Dundee Energy Limited 58% 58% 58% 58% (22) 111

Dundee Sustainable Technologies Inc. 66% 63% 64% 83% (1,308) 9,849

Ravensden Alternative Group 100% 100% 100% 93% - (159)

United Hydrocarbon International Corp. 35% 35% 35% 29% (9) 9,539

Total (818)$ 19,003$


shares of AgriMarine, and the common shares of AgriMarine were subsequently delisted from the Canadian Securities

Exchange.

During the nine months ended September 30, 2015, Dundee Sustainable Technologies Inc. (“DSTI”) issued 15,384,615

subordinate voting shares from its treasury pursuant to a private placement transaction. In addition, the Corporation

exercised 50,000,000 warrants to acquire an equal number of subordinate voting shares of DSTI for $0.10 per share or a

total of $5,000,000. As a result of these transactions, the Corporation’s ownership interest in DSTI was increased from 63%

at December 31, 2014 to 66% at September 30, 2015, resulting in the Corporation recognizing a reduction in contributed

surplus of $1,308,000. During the first nine months of 2014, DSTI had issued 63,615,477 subordinate voting shares from its

treasury, which resulted in an increase to contributed surplus of $9,849,000.

During the first nine months of the prior year, the Corporation increased contributed surplus by $9,539,000, reflecting the

issuance by United Hydrocarbon International Corp. (“UHIC”) of 20,000,000 treasury shares with a value of $10,000,000 to

the Corporation in recognition of its contribution towards an oil discovery, as well as the recognition of compensation

expense of $8,980,000 following the acceleration of vesting criteria associated with certain of UHIC’s outstanding warrants.

6 . C L I E N T A C C O U N T S R E C E I V A B L E

“Funds deposited into trust” include $344,525,000 (December 31, 2014 – $252,277,000) of client funds deposited and held

by the Corporation’s full service brokerage subsidiary, Dundee Securities Ltd. (“Dundee Securities”), in registered accounts.

These funds have been deposited with a Canadian trust company. “Funds deposited into trust” also include $17,971,000

(December 31, 2014 – $16,563,000) of funds placed in escrow by acquirers in real estate property transactions from which

applicable fees are distributed to the relevant parties associated with the real estate transaction. Included in “Client deposits

and related liabilities” (note 17) is a corresponding liability related to these deposits.

7 . D E R I V A T I V E F I N A N C I A L I N S T R U M E N T S

Commodity Risk Management

At December 31, 2014, Dundee Energy Limited (“Dundee Energy”) had entered into commodity swap derivative contracts

to manage its exposure to volatility in the prices received for the sale of the underlying commodities. These derivative

instruments were not designated as hedging instruments and accordingly, they were classified as financial instruments at fair

value through profit or loss. During the nine months ended September 30, 2015, Dundee Energy received cash of $341,000

in final settlement of these derivative contracts. There were no commodity-based derivative contracts outstanding at

September 30, 2015. During the three and nine months ended September 30, 2014, Dundee Energy recognized a gain of

$376,000 and a loss of $116,000 respectively from changes in the fair value of commodity swap derivative contracts.

Warrants and Options Associated with Investments

Included in the Corporation’s portfolio of investments are warrants and/or options, which were acquired directly by the

Corporation, or which were received by the Corporation as consideration for the Corporation’s investment in the underlying

investee. These warrants and/or options are derivative financial assets and are carried in the Corporation’s consolidated

statements of financial position at their estimated fair value, determined using a modified Black Scholes option pricing

model.


Client accounts 480,934$ 259,042$

Brokers' and dealers' balances 8,954 1,103

Funds deposited into trust 362,496 268,840

Amounts receivable from carrying broker 83,483 23,651

935,867$ 552,636$


Embedded Derivative – Preference Shares

During the first nine months of the prior year, the Corporation recognized a loss of $300,000 relating to the redemption

option feature associated with certain of its preference shares. There has been no change in the fair value of the redemption

option feature associated with the Corporation’s preference shares since December 31, 2014.

8 . B R O K E R A G E S E C U R I T I E S O W N E D A N D B R O K E R A G E S E C U R I T I E S S O L D S H O R T

Bonds have maturities ranging from 2015 to 2037 (December 31, 2014 – from 2015 to 2108) and have annual interest yields

ranging from 1.25% to 11.0% (December 31, 2014 – 1.00% to 12.00%).

9 . I N V E S T M E N T S

During the nine months ended September 30, 2015, the Corporation invested $9,784,000 (nine months ended September 30,

2014 – $66,653,000; year ended December 31, 2014 – $47,571,000) to acquire new positions, or to increase its interest in

existing positions within its portfolio. During the same period, the Corporation generated proceeds of $162,563,000 (nine

months ended September 30, 2014 – $262,399,000; year ended December 31, 2014 – $279,191,000) from the sale of certain

other investments.

Fair Value of Investments

Net (Loss) Gain from Investments

Changes in the fair value of individual investments are included in the Corporation’s net earnings or loss. During the three

and nine months ended September 30, 2015, the Corporation incurred a loss of $90,665,000 and $241,810,000 respectively

(three and nine months ended September 30, 2014 – $81,246,000 and $108,389,000 respectively).


Securities Securities Securities Securities

Owned Sold Short Owned Sold Short

Bonds 14,558$ 8,510$ 17,370$ 9,723$

Equities 42,953 3,786 24,075 1,300

Other 2,571 - 2,355 -

60,082$ 12,296$ 43,800$ 11,023$


Cost Fair Value Cost Fair Value

Publicly traded securities 719,671$ 310,309$ 526,854$ 323,753$

Private investments 184,467 126,253 203,158 188,570

Mutual funds and other short-term investments 86 50 85 55

Debt securities 74,735 42,955 172,324 140,508

Warrants and options 787 235 880 810

979,746$ 479,802$ 903,301$ 653,696$


Realized Unrealized Realized Unrealized

Publicly traded securities (977)$ (206,256)$ (45,082)$ (72,606)$

Private investments 11,808 (43,624) (276) 7,047

Mutual funds and other short-term investments - (6) - (21)

Debt securities (2,259) 35 1,191 1,304

Warrants and options (49) (482) (46) 100

8,523$ (250,333)$ (44,213)$ (64,176)$


The loss during the nine months ended September 30, 2015 includes $134,212,000 relating to the Corporation’s investment

in 35,470,807 common shares of Dundee Precious Metals Inc., which the Corporation previously accounted for on an equity

basis (note 10), and $54,956,000 relating to the Corporation’s investment in 21,636,288 common shares of Dream Unlimited

Corp.

1 0 . E Q U I T Y A C C O U N T E D I N V E S T M E N T S

(i) Dundee Corporation owns a 50% interest in Paragon Holdings (Smithe Street) ULC, which, in turn owns an indirect 74% interest in a

resort development project, giving Dundee Corporation an effective 37% interest in the underlying project.

(ii) Dundee Energy Limited’s 74% owned subsidiary, Castor UGS Limited Partnership, holds a 33% interest in Escal UGS S.L., giving Dundee Energy Limited an effective 23% interest and Dundee Corporation an effective 14% interest in Escal UGS S.L. and its

underlying project.

A detailed description of significant transactions that affected the carrying value of equity accounted investments as at

December 31, 2014 is provided in note 12 to the 2014 Audited Consolidated Financial Statements. Significant transactions

affecting the carrying value of equity accounted investments since December 31, 2014 are described below.

Dundee Sarea Acquisition I Limited Partnership (“Dundee Sarea”)

During the third quarter of 2015, Dundee Sarea received initial capital commitments of $112,500,000 to establish its initial

special situations fund, the mandate of which is to invest in companies requiring turn-around expertise in North America and

Europe, with a focus on manufacturing, distribution, industrial products, agriculture, oil and gas and forestry-related

industries. The Corporation initially committed $37,500,000 towards the establishment of Dundee Sarea, of which

$14,569,000 had been invested at September 30, 2015, representing 50% of the aggregate committed amount to the fund.

On September 16, 2015, the fund raised third party committed capital of a further $37,500,000, reducing the Corporation’s

interest in the fund to approximately 33%. In connection with the raising of third party capital, in October 2015, the

Corporation received cash of $4,891,000 as its pro-rata return of capital upon the committed investment by the third party.

The effect of the third party capital contribution and the subsequent return of capital in October 2015 have been reflected in


Realized Unrealized Realized Unrealized

Publicly traded securities 1,932$ (77,449)$ (42,551)$ (40,676)$

Private investments - (14,102) 21 6,792

Mutual funds and other short-term investments - (11) - (11)

Debt securities 903 (1,921) (258) 702

Warrants and options 13 (30) 103 (5,368)

2,848$ (93,513)$ (42,685)$ (38,561)$


Trade Carrying Fair Carrying Fair

Symbol Investment Ownership Value Value Ownership Value Value

n/a Paragon Holdings (Smithe Street) ULC (i) 50% 56,068$ private 50% 70,560$ private

n/a Union Group International Holdings Limited 40% 67,037 private 40% 52,018 private

n/a Android Industries, LLC 20% 25,644 private 20% 21,847 private

n/a Cambridge Medical Funding Group II, LLC 50% 11,517 private 50% 10,683 private

n/a Dundee Sarea Acquisition I Limited Partnership 33% 10,345 private 50% 7,356 private

ODX Odyssey Resources Limited 31% 190 227 31% 234 341

n/a Dundee Acquisition Ltd. 98% (553) private n/a n/a n/a

DPM Dundee Precious Metals Inc. n/a n/a n/a 25% 191,704 95,771

n/a Eagle Hill Exploration Corporation n/a n/a n/a 29% 2,810 2,810

n/a Ryan Gold Corp. n/a n/a n/a 20% 2,574 2,574

n/a Corona Gold Corporation n/a n/a n/a 24% 2,214 1,918

n/a Escal UGS S.L.(ii) 14% - private 14% - private

170,248$ 362,000$


the carrying value of the Corporation’s investment in Dundee Sarea at September 30, 2015, with a corresponding increase in

accounts receivable.

Plan of Arrangement with Oban Mining Corporation (“Oban”)

In August 2015, Oban completed a plan of arrangement pursuant to which Oban acquired all of the common shares of each

of Eagle Hill Exploration Corporation, Ryan Gold Corp. and Corona Gold Corporation in exchange for the issuance of

common shares of Oban from its treasury. The Corporation received 7,694,311 common shares of Oban on the exchange,

which the Corporation has classified as an investment at fair value through profit or loss.

Dundee Acquisition Ltd. (“DAQ”)

On March 5, 2015, the Corporation created DAQ, a special purpose acquisition corporation established for the purpose of

effecting an acquisition of one or more businesses or assets, by way of a merger, share exchange, asset acquisition, share

purchase, reorganization, or any other similar business combination (a “Qualifying Acquisition”). Dundee Corporation

founded DAQ with an initial subscription of class B common shares of DAQ with a value of $25,000 or $0.008 per share.

On April 21, 2015, DAQ completed an initial public offering of class A restricted voting units at $10.00 per unit, each unit

consisting of a class A restricted voting share of DAQ, and one-half of a warrant, each whole warrant entitling the holder to

purchase an additional share of DAQ at $11.50 per share, subject to certain conditions as outlined in the prospectus

supporting the initial public offering. DAQ raised aggregate proceeds of $112,300,000 pursuant to the initial public

offering, including proceeds received on the exercise of an over-allotment option granted to its underwriters. In connection

with the initial public offering and its role as sponsor of DAQ, Dundee Corporation acquired 430,750 additional class B

common shares of DAQ at $10.00 per unit.

At September 30, 2015, DAQ had 14,575,937 shares outstanding, comprised of 11,230,000 class A restricted voting shares

and 3,345,937 class B common shares. Dundee Corporation held 3,272,677 class B common shares, representing 22% of

the aggregate issued and outstanding shares of DAQ. Accordingly, the Corporation is accounting for its investment in DAQ

as an equity accounted investment.

The class A restricted voting shares of DAQ provide the holder thereof with the right to redeem their shares in the event that

DAQ does not complete a Qualifying Acquisition within 21 months from the closing of the initial public offering, or in

certain other conditions as outlined in the prospectus and, as such, the class A restricted voting shares of DAQ have been

classified as debt in DAQ’s financial statements. As a result, the equity of DAQ consists solely of its class B common

shares, of which the Corporation holds 98%.

In connection with the initial public offering, DAQ placed $10.00 per class A restricted voting share into an escrow account

to settle any redemption requirement. The Corporation, as founder and sponsor of DAQ, does not have access to these funds

to fund ongoing operations, including legal and due diligence work necessary to complete a Qualifying Acquisition.

Dundee Corporation has also executed a make-whole agreement and undertaking in favour of DAQ, whereby Dundee

Corporation has agreed to indemnify DAQ in certain limited circumstances where the funds held in escrow are reduced to

below $10.00 per class A restricted voting share.

Since its creation, DAQ has incurred costs, including costs associated with its initial public offering, such that at September

30, 2015, DAQ had a shareholders’ deficiency, of which the Corporation’s share is approximately $553,000. The

Corporation has reduced its carrying value in this equity accounted investment to below zero to reflect its share of the

deficiency as it has certain legal obligations to make payments on behalf of the equity accounted investment, including any

payments required pursuant to the indemnity as outlined above.

Dundee Precious Metals Inc. (“Dundee Precious”)

The Corporation previously accounted for its investment in Dundee Precious on an equity basis. As a result of the

repositioning by the Corporation of certain members of its senior management, the Corporation no longer has representation

on the board of directors of Dundee Precious, nor does it have the contractual right to appoint representation to the board of


directors of Dundee Precious. As a consequence, the Corporation has determined that it is not capable of exerting

significant influence over Dundee Precious and accordingly, the Corporation’s investment in Dundee Precious has been

reclassified and designated as an investment at fair value through profit or loss (note 9).

Paragon Holdings (Smithe Street) ULC (“Paragon”)

On December 17, 2014, Parq Holdings Limited Partnership (“Parq”), Paragon’s 74% owned limited partnership structure,

completed US$415,000,000 in project financing designated for the development of the Vancouver-based Edgewater Casino

Resort Development project. During the nine months ended September 30, 2015, the Corporation’s share of losses incurred

by Paragon were $14,492,000, reflecting substantial foreign exchange losses related to the project financings.

Union Group International Holdings Limited (“Union Group”)

During the first quarter of the current year, a subsidiary of Union Group raised approximately US$25,000,000 to support the

development of certain infrastructure projects in Latin America. Included in equity earnings during the nine months ended

September 30, 2015 is a dilution gain of $10,888,000 relating to this transaction.

Share of Loss from Equity Accounted Investments

1 1 . R E A L E S T A T E J O I N T V E N T U R E I N V E S T M E N T S

During the three and nine months ended September 30, 2015, Dundee 360 Real Estate Corporation recognized a gain of

$161,000 and $143,000 respectively (three months ended September 30, 2014 – $87,000) from its investments in real estate

joint ventures.



Dundee Precious Metals Inc. -$ (2,648)$ 362$ (22,300)$

Paragon Holdings (Smithe Street) ULC (8,415) (1,912) (14,492) (2,007)

Union Group International Holdings Limited (347) 158 9,735 (650)

Android Industries, LLC (4) 1,063 1,622 (688)

Cambridge Medical Funding Group II, LLC (260) (202) 29 (507)

Dundee Sarea Acquisition I Limited Partnership 1,191 - 2,085 -

Dundee Acquisition Ltd. 327 - (4,885) -

Others (11) (1,327) (233) (1,036)

(7,519) (4,868) (5,777) (27,188)

Real estate joint venture investments 161 87 143 87

(7,358)$ (4,781)$ (5,634)$ (27,101)$


Carrying Carrying

Investment Ownership Value Ownership Value

Bellavista Resorts S.A. 30% 6,034$ 30% 5,245$

Vancuba Holdings S.A. 61% 305 61% 265

Sotarbat 360 S.A.S. 45% 2,512 45% 2,215

Receivable from real estate joint venture investees n/a 1,134 n/a 37

9,985$ 7,762$


1 2 . R E A L E S T A T E A S S E T S

* Real estate development project consisting of land held in Cavtat, Croatia.

1 3 . R E S O U R C E P R O P E R T I E S

Clearpoint Resort

Limited (Malta)*

Carrying value, December 31, 2014 13,209$


Net additions 105

Capitalization of interest expense (note 18) 52

Currency translation adjustment 897

Carrying value, September 30, 2015 14,263$

Exploration

and Evaluation

Oil and Gas Machinery Land

Development Pipeline and and Undeveloped

Costs Infrastructure Equipment Buildings Other Properties TOTAL

At December 31, 2013

Cost 140,767$ 27,253$ 28,855$ 15,929$ 3,402$ 203,041$ 419,247$

Accumulated depreciation and depletion (56,343) (6,117) (4,615) (1,162) (1,090) - (69,327)

Net carrying value, December 31, 2013 84,424 21,136 24,240 14,767 2,312 203,041 349,920

Nine months ended September 30, 2014

Carrying value December 31, 2013 84,424 21,136 24,240 14,767 2,312 203,041 349,920

Acquisitions 7,246 498 362 70 - 22,093 30,269

Net additions 2,012 - 322 82 330 157,029 159,775

Remeasure decommissioning liabilities (note 19) 4,144 - - - - 1,854 5,998

Depreciation and depletion (5,842) (818) (918) (91) (100) - (7,769)

Net carrying value, September 30, 2014 91,984 20,816 24,006 14,828 2,542 384,017 538,193

At September 30, 2014

Cost 154,169 27,751 29,539 16,081 3,732 384,017 615,289

Accumulated depreciation and depletion (62,185) (6,935) (5,533) (1,253) (1,190) - (77,096)


Transactions from October 1, 2014 to December 31, 2014

Carrying value September 30, 2014 91,984 20,816 24,006 14,828 2,542 384,017 538,193

Net additions 358 - (52) 140 (185) 54,756 55,017

Remeasure decommissioning liabilities (note 19) 4,612 - - - - 1,472 6,084

Depreciation, depletion and impairment (2,486) (341) (1,549) (64) (19) (37,518) (41,977)



Cost 159,139 27,751 29,428 16,221 3,547 440,245 676,331

Accumulated depreciation and depletion (64,671) (7,276) (7,023) (1,317) (1,209) (37,518) (119,014)




Disposition (note 4) - - - (9,955) - - (9,955)

Net additions 5 - 58 (287) (121) 72,635 72,290

Remeasure decommissioning liabilities (note 19) 812 - - - - 277 1,089

Depreciation, depletion and impairment (6,876) (982) (1,053) (78) (23) (215,156) (224,168)



Cost 159,956 27,751 29,486 4,715 3,418 513,157 738,483

Accumulated depreciation and depletion (71,547) (8,258) (8,076) (131) (1,224) (252,674) (341,910)

Net carrying value, September 30, 2015 88,409$ 19,493$ 21,410$ 4,584$ 2,194$ 260,483$ 396,573$

Property, Plant and Equipment


During the nine months ended September 30, 2015, the Corporation increased its carrying value in undeveloped properties

by $72,635,000, of which $60,259,000 represents foreign currency translation amounts associated with resource properties

in foreign jurisdictions.

Impairment of Resource Properties – United Hydrocarbon International Corp.

The Corporation had previously announced that it was seeking to raise third party debt or equity of up to $250,000,000, the

proceeds of which would be used by UHIC in connection with its ongoing exploration programs. Following the sharp

decline in oil prices in late 2014 and continuing into 2015, the Corporation has not consummated a transaction. Current

market conditions do not support the underlying carrying value of the Corporation’s resources properties associated with its

investment in UHIC. As a result, during the third quarter of 2015, the carrying value of these properties was impaired by

$215,156,000, to their estimated recoverable amount of $235,909,000.

The recoverable amounts of these resource properties were measured based on fair value less costs of disposal, determined

by applying comparable valuation metrics as determined in capital markets to UHIC’s most recent prospective resource

estimates. The valuation methodology applied is sensitive to the response of capital markets of further volatility in the

pricing outlook for oil, which may result in additional impairments to the resource properties, or may also result in the

reversal of such impairment if the underlying volatility and/or the price of oil improves. In determining the fair value of the

resource properties, the Corporation used a valuation methodology that included unobservable inputs, and therefore has

classified the measurement of the asset at level 3 of the fair value hierarchy.

1 4 . L I V E S T O C K

For the nine months ended September 30, 2015 For the year ended December 31, 2014

Biological Biological

Inventory Assets TOTAL Inventory Assets TOTAL

Balance, beginning of period 6,212$ 33,499$ 39,711$ 12,151$ 23,487$ 35,638$

Acquisitions (dispositions) (3,371) (3,580) (6,951) 679 5,500 6,179

Net additions (dispositions) 972 (5,924) (4,952) (6,618) (9,082) (15,700)

Fair value changes - 12,770 12,770 - 13,594 13,594

Balance, end of period 3,813$ 36,765$ 40,578$ 6,212$ 33,499$ 39,711$


1 5 . C A P I T A L A N D O T H E R A S S E T S

1 6 . G O O D W I L L

1 7 . C L I E N T D E P O S I T S A N D R E L A T E D L I A B I L I T I E S

Computer and Land Other

Furniture and Network and Intangible

Fixtures Equipment Buildings Other Trademarks Assets TOTAL


Cost 6,203$ 7,635$ 89,958$ 36,172$ 15,577$ 35,245$ 190,790$

Accumulated depreciation (4,988) (6,752) (868) (5,664) (6,439) (3,451) (28,162)

Net carrying value, December 31, 2013 1,215 883 89,090 30,508 9,138 31,794 162,628


Carrying value December 31, 2013 1,215 883 89,090 30,508 9,138 31,794 162,628

Net acquisitions and additions 1,483 2,875 (3,827) 20,467 414 75,588 97,000

Depreciation (458) (710) (639) (2,672) (790) (2,948) (8,217)



Cost 7,686 10,510 86,131 56,639 15,991 110,833 287,790

Accumulated depreciation (5,446) (7,462) (1,507) (8,336) (7,229) (6,399) (36,379)


From October 1, 2014 to December 31, 2014

Carrying value September 30, 2014 2,240 3,048 84,624 48,303 8,762 104,434 251,411

Net acquisitions and additions 767 210 (412) 2,255 13,690 (9,798) 6,712

Depreciation and impairment (350) (447) (301) (2,392) (267) (6,100) (9,857)



Cost 8,453 10,720 85,719 58,894 29,681 101,035 294,502





Dispositions (note 4) (25) (19) (24,996) (3,908) - (569) (29,517)

Net additions 1,001 852 7,045 9,728 222 (3,273) 15,575

Depreciation (945) (1,325) (2,387) (8,659) (14,420) (12,622) (40,358)



Cost 9,327 11,474 65,941 58,418 29,903 97,193 272,256


Net carrying value, September 30, 2015 2,688$ 2,319$ 63,573$ 45,327$ 7,987$ 72,072$ 193,966$

Capital Assets Intangible Assets


Dundee 360 Real Estate Corporation 14,117$ 14,117$


Client accounts 1,007,752$ 632,359$

Brokers' and dealers' balances 13,488 7,333

Funds in escrow 17,971 16,563

International banking client accounts - 15,212

1,039,211$ 671,467$


Included in “Client accounts” is $344,525,000 (December 31, 2014 – $252,277,000) of funds deposited and held by Dundee

Securities in registered accounts (note 6).

“Funds in escrow” of $17,971,000 (December 31, 2014 – $16,563,000) represent funds deposited in escrow by acquirers in

real estate property transactions from which applicable fees are distributed to the relevant parties associated with the real

estate transaction. Funds received pursuant to these arrangements are included in “Client accounts receivable” (note 6).

1 8 . C O R P O R A T E D E B T

The Corporation and its subsidiaries have established credit facilities and other debt arrangements, the terms of which are

outlined in note 20 to the 2014 Audited Consolidated Financial Statements. Other than as described below, there have been

no changes to the terms of credit facilities and other debt instruments available to the Corporation and to its subsidiaries.

$250 million Corporate Debt Facility

On April 30, 2015, the Corporation amended its existing debt facility, favourably modifying the terms of certain financial

ratios that establish the Corporation’s borrowing capacity in correlation to the fair value of certain of the Corporation’s

investments. In connection with the amendment, the maximum borrowing amount available pursuant to the credit facility

was reduced from $300 million to $250 million. Borrowings under the amended facility bear interest at a rate per annum

equal to the prime lending rate for loans plus 0.60% or, at the Corporation’s option, at the prevailing bankers’ acceptance

rate or London Interbank Offered Rate plus 1.60%, provided amounts borrowed are less than $140,000,000. If amounts

borrowed exceed $140,000,000, amounts drawn against the credit facility will bear interest at a rate per annum equal to the

prime lending rate for loans plus 0.75% or, at the Corporation’s option, at the prevailing bankers’ acceptance rate or London

Interbank Offered Rate plus 1.75%. Unused amounts available under the amended facility are subject to an annual standby

fee rate ranging from 0.36% to 0.39375%. The amended facility matures on November 11, 2016.

Repayment of 5.85% Exchangeable Unsecured Subordinated Debentures

At December 31, 2014, the Corporation had 6,490 outstanding exchangeable unsecured subordinated debentures with a par

value per debenture of $1,000, maturing on June 30, 2015. During the six months ended June 30, 2015, debentures with a

par value of $13,000 were submitted for exchange pursuant to the terms of these debentures, requiring the Corporation to

deliver 436 units of DREAM Office Real Estate Investment Trust in settlement thereof.

On June 30, 2015, the Corporation repaid the remaining $6,477,000 due pursuant to these debentures by delivering (i) a

further 218,175 units of DREAM Office Real Estate Investment Trust with a value of $5,256,000, being all of the remaining

units of DREAM Office Real Estate Investment Trust held by the Corporation on June 30, 2015; and (ii) cash of $1,221,000.

The obligations of the Corporation pursuant to the terms of the debentures were subsequently extinguished.

Loan Facilities, Blue Goose Capital Corp. (“Blue Goose”)

On May 26, 2015, Blue Goose Cattle Company Ltd., a subsidiary of Blue Goose, entered into a credit facility with a

Canadian Schedule I Chartered Bank. The credit facility provides the subsidiary with (i) a $7,500,000 demand revolving

credit facility bearing interest at prime plus 0.50%, thereby increasing borrowing availability from the previous revolving


Corporate

$250 million revolving term credit facility 92,648$ 89,596$

$6.5 million, 5.85% exchangeable unsecured subordinated debentures due June 30, 2015 - 6,473

Subsidiaries

$70 million demand revolving credit facility, Dundee Energy Limited 59,422 61,617

Loan facilities, Blue Goose Capital Corp. 41,531 52,018

Loan facilities, Dundee 360 Real Estate Corporation 726 3,935

194,327$ 213,639$


demand credit facility of $5,500,000; (ii) a $4,675,000 one-time advance for the purchase of certain real estate property,

which amount bears interest at prime plus 1.50%, formalizing the provisional promissory note arrangement in the amount of

$4,988,000 established earlier in the year; (iii) a one-time capital expenditure advance of $551,000, bearing interest at prime

plus 1.50%; and (iv) a revolving facility of up to $500,000 for the purchase of machinery and equipment, bearing interest at

prime plus 0.50%. At September 30, 2015, the subsidiary had borrowed $6,523,000 pursuant to the $7,500,000 demand

revolving credit facility and it had drawn $4,613,000 and $512,000 pursuant to the one-time advance arrangements as

described above to fund the acquisition of certain real estate and the related capital expenditures required on the property

acquired. The credit facility is secured against all of the assets of Blue Goose Cattle Company Ltd. In addition, Blue Goose

has provided a guarantee for up to $3,500,000 as further security against the credit facility.

Through its U.S. subsidiaries, Blue Goose had entered into a US$6,000,000 fixed term mortgage facility to finance the

acquisition of property in Colorado, and a US$1,000,000 facility to support its Wagyu cattle operations. At the time of the

sale of the property and associated Wagyu cattle operations (note 4), aggregate amounts borrowed pursuant to these facilities

were Cdn$7,871,000. Concurrent with the closing of the sale of the property and the associated operations, amounts

borrowed under these arrangements were fully repaid and the associated obligations were released.

Blue Goose had also entered into a $7,000,000 demand fixed term debt facility and a $1,000,000 demand revolving credit

facility to support the operations of its Commonwealth aggregates business. Amounts borrowed pursuant to these

arrangements immediately prior to the sale of the Commonwealth business (note 4) were $7,394,000. Concurrent with

completion of the sale of Commonwealth, all amounts borrowed pursuant to these arrangements were repaid, and the loan

arrangements were terminated.

Blue Goose and its subsidiaries have established credit facilities of up to $24,750,000 with a leading lender to the

agricultural sector that require the maintenance of certain financial covenants customary to such loan arrangements,

including the maintenance of certain interest coverage ratios in excess of specified amounts and covenants that limit the

amount of liabilities that may be assumed by Blue Goose or its subsidiaries. The loan arrangements also oblige Blue Goose

and its subsidiaries to comply with certain reporting requirements, including the delivery of financial information and debt

covenant certification as provided for in the loan arrangements. At September 30, 2015, $22,650,000 of debt in Blue Goose

and some of its subsidiaries was in default of certain financial covenant requirements pursuant to these arrangements. With

the knowledge of the lenders, Blue Goose and its subsidiaries are actively engaged in ensuring that deficiencies are rectified.

The lending institutions to Blue Goose do not have recourse to Dundee Corporation in respect of any of the amounts

borrowed by Blue Goose and its subsidiaries.

Certain wholly-owned subsidiaries of Blue Goose have entered into demand credit facilities in order to provide working

capital to facilitate underlying operations. Borrowings under these arrangements bear interest at a rate per annum of prime.

These demand revolving credit facilities are secured by a general security agreement against all of the assets of the

underlying subsidiaries, and are guaranteed by Blue Goose. At September 30, 2015, Blue Goose and its subsidiaries had

borrowed $7,233,000 pursuant to these arrangements.


Interest Expense Incurred on Corporate Debt*

* Interest expense excludes $52,000 of interest incurred and capitalized to the cost of real estate assets (note 12).

1 9 . D E C O M M I S S I O N I N G L I A B I L I T I E S

2 0 . P R E F E R E N C E S H A R E S

The terms of the Corporation’s preference shares are summarized in note 22 to the Corporation’s 2014 Audited

Consolidated Financial Statements.

Issued and Outstanding First Preference Shares, Series 2 (“Preference Shares, series 2”)

Issued and Outstanding First Preference Shares, Series 3 (“Preference Shares, series 3”)



Corporate

$250 million revolving term credit facility 997$ -$ 3,202$ -$

$150 million revolving term credit facility,

extinguished on November 13, 2014 - 539 - 2,086

Subsidiaries

$70 million demand revolving credit facility,

Dundee Energy Limited 826 613 2,574 2,468

Loan facilities, Blue Goose Capital Corp. 338 537 1,364 1,510

2,161$ 1,689$ 7,140$ 6,064$

As at and for the nine months ended As at and for the year ended

September 30, 2015 December 31, 2014

Discount rates applied to future obligations 0.52% - 2.09% 1.00% - 2.22%

Inflation rate 2.00% 1.70% - 2.00%

Discounted future obligations, beginning of period 59,233$ 42,734$

Effect of acquisitions - 4,870

Effect of changes in estimates and

remeasurement of discount and foreign exchange rates 1,089 12,082

Liabilities settled (reclamation expenditures) (497) (1,631)

Accretion (interest expense) 803 1,178

Discounted future obligations, end of period 60,628$ 59,233$

Number Par Issue Carrying

of Shares Value Costs Value

Balance as at December 31, 2013 5,200,000 130,000$ (2,932)$ 127,068$


Conversion to Preference Shares, series 3 (1,720,615) (43,015) - (43,015)

Balance as at September 30, 2015, December 31, 2014 and September 30, 2014 3,479,385 86,985$ (2,932)$ 84,053$

Number Par Carrying

of Shares Value Value

Balance as at December 31, 2013 - -$ -$


Conversion from Preference Shares, series 2 1,720,615 43,015 43,015

Balance as at September 30, 2015, December 31, 2014 and September 30, 2014 1,720,615 43,015$ 43,015$


Issued and Outstanding First Preference Shares, series 4 (“Preference Shares, series 4”)

(i) The fair value of outstanding Preference Shares, series 4 as at September 30, 2015 was $104,100,000.

2 1 . S H A R E C A P I T A L

The terms of the Corporation’s Class A subordinate voting shares (“Subordinate Shares”) and Class B common shares

(“Class B Shares”), and significant transactions in respect thereof during the year ended December 31, 2014, are

summarized in note 23 to the Corporation’s 2014 Audited Consolidated Financial Statements.

Issued and Outstanding

Number Par Issue Carrying

of Shares Value Costs Premium Value

Balance as at December 31, 2013 6,000,000 107,040$ (846)$ 221$ 106,415$


Amortization - - 254 (67) 187

Balance as at September 30, 2014 6,000,000 107,040 (592) 154 106,602

Transactions during the period from October 1, 2014

to December 31, 2014


Balance as at December 31, 2014 6,000,000 107,040 (508) 133 106,665



Balance as at September 30, 2015 (i) 6,000,000 107,040$ (254)$ 66$ 106,852$

Number Amount Number Amount Number Amount

Outstanding December 31, 2013 50,990,566 200,279$ 3,115,835 8,156$ 54,106,401 208,435$

Transactions during the nine months

ended September 30, 2014

Shares issued in a business combination 2,779,983 45,541 - - 2,779,983 45,541

Shares redeemed pursuant to

normal course issuer bid (615,000) (2,465) - - (615,000) (2,465)

Issuance of shares under the

share incentive plan 6,005 105 - - 6,005 105

Options exercised 22,714 342 - - 22,714 342

Conversion from Class B Shares

to Subordinate Shares 600 1 (600) (1) - -

Outstanding September 30, 2014 53,184,868 243,803 3,115,235 8,155 56,300,103 251,958

Transactions during the period from

October 1, 2014 to December 31, 2014

Issuance of shares under the

share incentive plan 2,345 35 - - 2,345 35

Options exercised 9,045 135 - - 9,045 135

Outstanding December 31, 2014 53,196,258 243,973 3,115,235 8,155 56,311,493 252,128

Transactions during the nine months

ended September 30, 2015

Shares redeemed pursuant to

normal course issuer bid (55,000) (275) - - (55,000) (275)

Issuance of shares under

share incentive arrangements 301,433 3,536 - - 301,433 3,536

Options exercised 2,089,107 26,250 - - 2,089,107 26,250

Conversion from Class B Shares

to Subordinate Shares 3 - (3) - - -

Outstanding September 30, 2015 55,531,801 273,484$ 3,115,232 8,155$ 58,647,033 281,639$

SUBORDINATE SHARES CLASS B SHARES TOTAL


Normal Course Issuer Bid

On April 14, 2015, the Corporation announced that it had received regulatory approval for the renewal of its normal course

issuer bid from April 16, 2015 to April 15, 2016. Subject to certain conditions, the Corporation may purchase up to a

maximum of 3,576,599 Subordinate Shares pursuant to these arrangements, representing approximately 10% of its public

float at the time approval for the normal course issuer bid was granted.

During the nine months ended September 30, 2015, the Corporation purchased 55,000 Subordinate Shares, having an

aggregate stated capital value of $275,000, for cancellation pursuant to these arrangements. The Corporation paid $536,000

to retire these shares. The excess of the purchase price over the value of stated capital, which totalled $261,000, was

recorded as a reduction in retained earnings. During the year ended December 31, 2014, the Corporation purchased for

cancellation a total of 615,000 Subordinate Shares pursuant to its normal course issuer bid.

Shares Issued in a Business Combination

In July 2014, the Corporation issued 2,779,983 Subordinate Shares in connection with its acquisition of Dundee 360 Real

Estate Corporation (“Dundee 360”) (see note 5 to the 2014 Audited Consolidated Financial Statements). The Subordinate

Shares were issued with a fair value of $16.38 per share. In April 2015, the Corporation issued a further 256,420

Subordinate Shares with a value of $3,000,000 to settle share-based compensation arrangements with certain executives of

Dundee 360.

Share Purchase Plan

As part of its share incentive arrangements, the Corporation established a share purchase plan pursuant to which eligible

participants may contribute up to a specified maximum amount of their basic annual salary towards the purchase of

Subordinate Shares of the Corporation, either from treasury or in the open market, at the discretion of the Corporation. The

Corporation temporarily suspended participation in the share purchase plan during the first nine months of 2015. During the

three and nine months ended September 30, 2014, compensation expense associated with the Corporation’s share purchase

plan was $215,000 and $616,000 respectively.

Accumulated Other Comprehensive Income (Loss)

2 2 . N O N - C O N T R O L L I N G I N T E R E S T

Equity Foreign Non-

Accounted Currency controlling

Investments Translation Interest Total

Balance at December 31, 2013 (4,523)$ 542$ 2,109$ (1,872)$


Other comprehensive income 10,645 12,057 (8,297) 14,405

Balance at September 30, 2014 6,122 12,599 (6,188) 12,533

Transactions during the period from October 1, 2014 to December 31, 2014


Balance at December 31, 2014 11,816 25,693 (14,055) 23,454



Balance at September 30, 2015 33,278$ 87,789$ (52,529)$ 68,538$


Non-controlling interest in:

Blue Goose Capital Corp. 6,440$ 8,131$

Dundee Energy Limited 23,314 24,933

United Hydrocarbon International Corp. - 64,618

Other (655) 2

29,099$ 97,684$


During the third quarter of 2015, the Corporation impaired the carrying value of certain resource properties associated with

its investment in UHIC (note 13). The impairment resulted in a significant deficit in the shareholders' equity of UHIC.

Upon consolidation, the Corporation allocated $82,208,000 of the loss to non-controlling interests of UHIC, reducing the

carrying value of the non-controlling interests to $nil. The remaining loss is attributed to shareholders of the Corporation

because the deficit in UHIC is funded by debt instruments that the Corporation holds in UHIC, the terms of which are

considered to result in substantive ownership interests by the Corporation. The debt instruments are eliminated upon

consolidation.

2 3 . R E V E N U E S

2 4 . C O S T O F S A L E S

2 5 . S H A R E I N C E N T I V E P L A N A R R A N G E M E N T S

The terms of the Corporation’s share based compensation plans are summarized in note 27 to the Corporation’s 2014

Audited Consolidated Financial Statements.

Share Option Plan

A summary of the status of the Corporation’s share option plan as at September 30, 2015 and December 31, 2014, and the

changes during the periods then ended, are as follows:



Management fees 4,956$ 5,161$ 14,809$ 14,056$

Financial services 9,550 17,875 50,770 76,444

Oil and gas, net of royalties 6,400 8,574 20,112 30,716

Agriculture 16,104 21,411 49,300 63,029

Real estate 25,693 26,764 69,412 26,764

Interest, dividends and other 3,706 6,112 14,873 29,533

66,409$ 85,897$ 219,276$ 240,542$



Variable compensation 8,910$ 12,246$ 34,376$ 46,361$

Oil and gas expenses 4,380 4,443 12,346 10,969

Agriculture expenses 19,744 25,529 60,659 81,208

Real estate expenses 19,161 19,228 47,235 19,228

52,195$ 61,446$ 154,616$ 157,766$

For the nine months ended September 30, 2015 For the year ended December 31, 2014

Weighted Weighted

Number of Average Number of Average

Options Exercise Price Options Exercise Price

Outstanding, beginning of period 1,232,500 $9.40 1,250,000 $9.40

Exercised (1,232,500) $9.40 (17,500) $9.48

Outstanding, end of period - - 1,232,500 $9.40

Exercisable options - - 1,232,500 $9.40


Deferred Share Unit Plan

During the first nine months of 2015, the Corporation issued 35,854 deferred share units (“DSUs”). In addition, the

Corporation redeemed 46,451 DSUs following the departure of a director. At September 30, 2015, there were 1,272,157

(December 31, 2014 – 1,282,754) DSUs outstanding that track the value of the Corporation’s Subordinate Shares and

1,285,079 (December 31, 2014 – 1,332,430) DSUs that track the value of a Class A subordinate voting share of DREAM

Unlimited Corp.

Stock Based Compensation of the Corporation

Stock Based Compensation of Other Subsidiaries

From time to time, other subsidiaries of the Corporation may incur stock based compensation expense pursuant to their

respective share incentive plan arrangements. During the three and nine months ended September 30, 2015, the Corporation

recognized a stock based compensation recovery amount of $314,000 and $76,000 respectively due to the departure of

employees prior to the vesting of their awards. During the three and nine months ended September 30, 2014, subsidiaries of

the Corporation incurred stock based compensation expense of $248,000 and $525,000 respectively. Additionally, during

the three and nine months ended September 30, 2014, $131,000 and $420,000 respectively of stock based compensation

expense was capitalized to the cost of resource properties. There were no amounts of stock based compensation expense

capitalized to the cost of resource properties during the nine months ended September 30, 2015.

2 6 . G E N E R A L A N D A D M I N I S T R A T I V E E X P E N S E S B Y N A T U R E

* Includes compensation expense of $8,980,000 associated with acceleration of vesting criteria on outstanding warrants of UHIC (note 5).

** Includes a net loss on sale of certain assets of $4,392,000 (note 4).

2 7 . I N C O M E T A X E S

During the three and nine months ended September 30, 2015, the Corporation recognized an income tax recovery amount on

its loss from operations of $22,112,000 and $73,331,000 respectively (three and nine months ended September 30, 2014 –

$16,637,000 and $16,329,000 respectively), the major components of which include the following items:



Share option plan -$ 108$ -$ 602$

Deferred share unit plan 180 222 610 729

DREAM tracking share incentive arrangements:

Stock options - (2,457) (787) (4,698)

Deferred share units (3,418) (2,639) (3,258) (5,037)

(3,238)$ (4,766)$ (3,435)$ (8,404)$



Salary and salary-related 12,989$ 10,194$ 57,002$ 25,492$

Corporate and professional fees 9,746 8,549 30,228 24,084

General office 13,085 13,615 41,780 34,537

Capitalized expenditures (643) (882) (1,691) (1,996)

Other 7,261 5,268 22,229 ** 19,471 *

42,438$ 36,744$ 149,548$ 101,588$


The income tax recovery amount on the pre-tax loss from operations differs from the income tax recovery amount that

would arise using the combined Canadian federal and provincial statutory tax rate of 26% (nine months ended September

30, 2014 – 26%), as a result of the following items:

Significant components of the Corporation’s deferred income tax assets and liabilities are as follows:

A deferred income tax asset is only recognized when management believes it is more likely than not that the benefit will be

recognized.

At September 30, 2015, the Corporation had operating loss carry forwards of $499,511,000 (December 31, 2014 –

$288,154,000). Operating loss carry forwards by year of expiry are summarized below:



Current income tax recovery (expense) (159)$ (10,609)$ 450$ (8,385)$

Deferred income tax recovery 22,271 27,246 72,881 24,714

Total income tax recovery 22,112$ 16,637$ 73,331$ 16,329$



Loss before tax at statutory rate of 26%

(2014 – 26%) 92,086$ 26,021$ 155,453$ 45,207$

Effect on taxes of:

Non-deductible expenses (6,181) (7,505) (8,394) (14,474)

Non-taxable revenue (842) 1,504 2,048 3,774

Net income tax not previously recognized (11) 233 898 (1,578)

Change in unrecognized temporary differences (62,285) (2,543) (74,411) (14,582)

Other differences (655) (1,073) (2,263) (2,018)

Income tax recovery 22,112$ 16,637$ 73,331$ 16,329$


Deferred income tax assets

Loss carry forwards 71,373$ 32,566$

Capital and other assets 3,692 1,870

Non-deductible reserves 1,061 907

Accrued liabilities 4,923 3,628

Other 19,031 18,385

Total deferred income tax assets 100,080 57,356

Deferred income tax liabilities

Investments including equity accounted investments (45,398) (65,124)

Other (26,584) (32,392)

Total deferred income tax liabilities (71,982) (97,516)

Net deferred income tax assets (liabilities) 28,098$ (40,160)$

Year of Expiry: Recognized Unrecognized Total

2024 and subsequent years 269,317$ 215,978$ 485,295$

Non-Canadian - 14,216 14,216

269,317$ 230,194$ 499,511$


2 8 . N E T L O S S P E R S H A R E

2 9 . S U P P L E M E N T A L C A S H F L O W I N F O R M A T I O N

Items Not Affecting Cash and Other Adjustments

Changes in Non-Cash Working Capital Items

3 0 . F I N A N C I A L I N S T R U M E N T S

The following table summarizes those assets and liabilities that are included at their fair values in the Corporation’s

consolidated statements of financial position, or those assets and liabilities for which fair value is otherwise disclosed in the

accompanying notes to the consolidated financial statements. These assets and liabilities have been categorized into

hierarchal levels, according to the significance of the inputs used in determining fair value measurements.



Net loss attributable to owners of the parent (235,898)$ (78,655)$ (404,190)$ (140,196)$

Less: Dividends on Preference Shares, series 2 (1,237) (2,193) (3,711) (6,581)

Dividends on Preference Shares, series 3 (513) - (1,542) -

(237,648)$ (80,848)$ (409,443)$ (146,777)$ -$ -$ 53,926,358$

Weighted average number of shares outstanding during the period 58,682,223 56,259,015 58,273,857 54,712,455

Basic and diluted loss per share (4.05)$ (1.44)$ (7.03)$ (2.68)$

For the nine months ended September 30, 2015 September 30, 2014

Depreciation and depletion 264,927$ 22,262$

Net loss from investments 241,810 108,389

Share of loss from equity accounted investments 5,634 27,101

Gain on sale of equity accounted investments - (6,714)

Fair value changes in livestock (12,770) (10,573)

Deferred income taxes (72,881) (24,714)

Stock based compensation (3,511) (7,879)

Accelerated vesting of warrants of a subsidiary - 8,980

Other 10,287 6,485

433,496$ 123,337$

For the nine months ended September 30, 2015 September 30, 2014

Accounts receivable 2,589$ (5,566)$

Accounts payable and accrued liabilities 13,519 (17,773)

Current income tax amounts (12,055) 30,500

Brokerage securities owned and sold short, net (14,598) 7,125

Client accounts receivable, net of client deposits and related liabilities (15,487) (12,235)

Agricultural inventory 27,705 14,247

1,673$ 16,298$


The Corporation has a significant portfolio of investments in private enterprises, with substantial exposure to the

development of natural resource and energy sectors. During the second and third quarters of 2015, global economic

conditions continued to deteriorate, precipitating increased volatility in capital markets generally. Commodity prices have

been particularly affected by this volatility. These factors make the determination of appropriate risk premiums, cost of

capital, liquidity discounts and other key inputs to the Corporation’s valuation models inherently more uncertain.

Furthermore, in more stable market conditions, the Corporation was able to infer more concrete valuation inputs from

various observable sources, including public debt and equity markets, as well as comparable and/or precedent transactions.

Accordingly, during the second quarter of 2015, the Corporation determined that it was appropriate to transfer its portfolio

of private investments from level 2 to level 3. Transfers between fair value hierarchy levels are considered effective from

the beginning of the reporting period in which the transfer is identified. A summary of changes in the fair value of level 3

financial assets since the transfer from level 2 on April 1, 2015, is as follows:

Reasonably possible changes in the value of unobservable inputs for any of these individual investments would not

significantly change the fair value of investments classified as level 3 in the fair value hierarchy.

Fair Value as at September 30, 2015

Quoted prices in Significant

active markets other Significant

Carrying Value for identical observable unobservable

as at assets inputs inputs

September 30, 2015 (Level 1) (Level 2) (Level 3)

Recurring Measurements

Financial Assets

Investments

Publicly traded securities 310,309$ 310,309$ -$ -$

Private investments 126,253 - - 126,253

Mutual funds and other short-term investments 50 50 - -

Debt securities 42,955 8,131 - 34,824

Warrants and options 235 - - 235

Brokerage securities owned

Bonds 14,558 - 14,558 -

Equities 42,953 37,101 5,852 -

Other 2,571 - 2,571 -

Financial Liabilities

Brokerage securities sold short (12,296) (125) (12,171) -

Livestock 36,765 - 36,765 -

Disclosure of Fair Value

Publicly traded equity accounted investments 190 227 - -

Preference Shares, series 4 106,852 104,100 - -

Private Debt Warrants

Investments Securities and Options Total

At March 31, 2015 -$ -$ -$ -$

Transactions during the six months ended September 30, 2015

Transfer from level 2 184,643 82,309 281 267,233

New investments 2,339 5,715 - 8,054

Proceeds from sales of investments (27,103) (46,376) (45) (73,524)

Transfer to level 1 - (5,374) - (5,374)

Changes in market values (33,602) (2,073) (1) (35,676)

Transfer to equity accounted investments (24) (2,364) - (2,388)

Other transactions - 2,987 - 2,987

At September 30, 2015 126,253$ 34,824$ 235$ 161,312$


Other than as described above, there have been no other transfers between the fair value hierarchy levels during the three

and nine months ended September 30, 2015.

A detailed description of the Corporation’s financial assets and financial liabilities and its associated risk management in

respect thereof are provided in note 32 to the 2014 Audited Consolidated Financial Statements. Other than as described

above, there have been no significant changes in the business and economic circumstances and the related financial risks

that affect the Corporation’s valuation of financial assets and financial liabilities since December 31, 2014.

3 1 . C A P I T A L M A N A G E M E N T

The Corporation defines the capital that it manages as the aggregate of its shareholders’ equity and interest bearing debt,

including outstanding preference shares. The following table summarizes the carrying value of the Corporation’s capital as

at September 30, 2015 and December 31, 2014.

The Corporation’s objectives when managing capital include (i) ensuring that the Corporation and all of its regulated entities

meet relevant regulatory capital requirements; (ii) ensuring that the Corporation is able to meet its financial obligations as

they become due, whilst ensuring compliance with all applicable debt covenants; (iii) ensuring that the Corporation has

sufficient capital to manage business activities in each of its operating segments; (iv) ensuring that the Corporation has

sufficient capital available to benefit from acquisition opportunities, should they arise; and (v) ensuring adequate returns for

shareholders. The Corporation regularly assesses its capital management practices in response to changing economic

conditions.

Certain of the Corporation’s subsidiaries are subject to regulatory capital requirements. Compliance with these requirements

requires that the subsidiaries maintain sufficient cash and other liquid assets on hand to maintain regulatory capital

requirements, rather than using these liquid assets in connection with its business or otherwise. As at September 30, 2015

and December 31, 2014, the Corporation and its subsidiaries complied with all regulatory capital requirements.

3 2 . C O M M I T M E N T S , C O N T I N G E N C I E S A N D O F F - B A L A N C E S H E E T A R R A N G E M E N T S

A description of the Corporation’s commitments, contingencies and off-balance sheet arrangements is provided in note 34 to

the Corporation’s 2014 Audited Consolidated Financial Statements. The following provides a summary of material changes

to these items as at September 30, 2015.

Legal Contingencies

As part of a business reorganization completed in 2011, Dundee Capital Markets Inc., the parent company of Dundee

Securities, agreed to provide an indemnity with respect to certain claims. In 2011, Sino-Forest Corporation (“Sino-Forest”)

was delisted from the TSX, following allegations of securities violations. One of the parties indemnified by Dundee Capital

Markets Inc. participated in underwriting syndicates in respect of several public equity offerings by Sino-Forest. The

indemnified party is a defendant in at least one lawsuit brought by shareholders of Sino-Forest, alleging securities law and

other violations. Sino-Forest received an order for creditor protection in March 2012 and its Companies' Creditors

Arrangement Act (“CCAA”) plan was implemented in January 2013 and was recognized by the U.S. Bankruptcy Court

under Chapter 11 of the U.S. Bankruptcy Code in March 2013.


Shareholders' equity 1,137,656$ 1,477,181$

Corporate debt 194,327 213,639

Preference Shares, series 4 106,852 106,665

1,438,835$ 1,797,485$


In May 2012, the Ontario Securities Commission commenced formal proceedings against Sino-Forest and certain of its

current and former executives alleging fraud and securities law violations. In December 2012, the Ontario Securities

Commission commenced formal proceedings against Ernst & Young, Sino-Forest’s former auditor, alleging certain audit

deficiencies that allegedly amount to breaches of the Securities Act (Ontario); those proceedings were settled in September

2014, pursuant to which Ernst & Young paid a fine. The aforementioned shareholder lawsuit is a proposed class

proceeding. A settlement involving the members of the underwriting syndicates has been reached, subject to court approval

as part of the ongoing CCAA process.

The Corporation is also a defendant in various other legal actions. The defenses to these claims and the quantification of

damages are yet to be determined and the amount of the loss, if any, cannot be determined at this time. The Corporation

intends to vigorously defend itself against all legal claims. Although the ultimate outcome of these matters cannot be

ascertained at this time and the results of legal proceedings cannot be predicted with certainty, it is the opinion of

management, based on information currently available, that these are not material liabilities, adequate provisions have been

made for any liabilities and the resolution of these matters will not have a material adverse effect on the consolidated

financial position of the Corporation.

3 3 . R E L A T E D P A R T Y T R A N S A C T I O N S

There have been no significant changes in the nature and scope of related party transactions to those described in note 35 to

the Corporation’s 2014 Audited Consolidated Financial Statements.

3 4 . S E G M E N T E D I N F O R M A T I O N

The Corporation’s reportable business segments are organized in a manner that reflects how management views those

business activities. The tabular information that follows shows data of reportable segments reconciled to amounts reflected

in these consolidated financial statements.

Business Entity Business Activity

Corporate and Other Portfolio Holdings Investments in public and private equity and debt securities

in diversified industry segments

Goodman & Company, Investment Counsel Inc. 100%-owned private subsidiary registered as a portfolio

manager and exempt market dealer across Canada and an

investment fund manager in Ontario, Quebec and

Newfoundland

Dundee Securities Ltd. 100%-owned private subsidiary and a full-service Canadian

investment dealer registered with the Investment Industry

Regulatory Organization of Canada

Dundee Energy Limited 58%-owned publicly listed subsidiary in the oil and gas

industry with operations in southern Ontario

United Hydrocarbon International Corp. 35%-owned private subsidiary engaged in oil and gas

exploration, development and production activities in the

Republic of Chad

Dundee Sustainable Technologies Inc. 66%-owned publicly listed subsidiary developing patented

sustainable precious and base metals extraction processes


Eurogas International Inc. 53%-owned publicly listed subsidiary engaged in oil and gas

exploration

Blue Goose Capital Corp. 88%-owned private subsidiary operating in organic and

natural protein production markets

AgriMarine Holdings Inc. 100%-owned private aquaculture company focused on fish

farming and sustainable aquaculture technologies

Dundee 360 Real Estate Corporation 100%-owned private subsidiary engaged in development

and management of international hotel, resort, residential

and commercial real estate projects


Segmented Operations for the Nine Months Ended September 30, 2015

Segmented Operations for the Nine Months Ended September 30, 2014

Other Amounts

Revenues Cost of Sales in Loss Net Loss

Corporate and other portfolio holdings 8,805$ -$ (273,013)$ (264,208)$

Asset management and capital markets

Goodman & Company, Investment Counsel Inc. 1,548 - (3,656) (2,108)

Dundee Securities Ltd. 71,306 (34,376) (51,361) (14,431)

Resource industry

Dundee Energy Limited 21,140 (12,346) (15,373) (6,579)

United Hydrocarbon International Corp. (335) - (246,222) (246,557)

Dundee Sustainable Technologies Inc. 6 - (4,720) (4,714)

Eurogas International Inc. - - (571) (571)

Agriculture industry

Blue Goose Capital Corp. 44,548 (54,537) (3,699) (13,688)

AgriMarine Holdings Inc. 4,972 (6,122) (20,879) (22,029)

Real Estate industry

Dundee 360 Real Estate Corporation 69,444 (47,235) (33,937) (11,728)

Intersegment (2,158) - 2,158 -

219,276$ (154,616)$ (651,273)$ (586,613)

Income taxes 73,331

Non-controlling interest 109,092

NET LOSS ATTRIBUTABLE TO OWNERS OF DUNDEE CORPORATION (404,190)$

Other Amounts Net Loss /

Revenues Cost of Sales in Loss / Earnings Earnings



Goodman & Company, Investment Counsel Inc. 2,441 - (3,542) (1,101)


Resource industry

Dundee Energy Limited 30,983 (10,969) (16,250) 3,764

United Hydrocarbon International Corp. - - (24,486) (24,486)




Blue Goose Capital Corp. 62,068 (78,460) (4,871) (21,263)




Intersegment (10,411) - 10,411 -

240,542$ (157,766)$ (253,371)$ (170,595)

Income taxes 16,329




Segmented Operations for the Three Months Ended September 30, 2015

Segmented Operations for the Three Months Ended September 30, 2014

Other Amounts


Corporate and other portfolio holdings 967$ -$ (98,288)$ (97,321)$


Goodman & Company, Investment Counsel Inc. 473 - (1,406) (933)


Resource industry

Dundee Energy Limited 6,495 (4,380) (4,824) (2,709)

United Hydrocarbon International Corp. (90) - (223,414) (223,504)




Blue Goose Capital Corp. 14,122 (16,896) 1,470 (1,304)




Intersegment (107) - 107 -

66,409$ (52,195)$ (361,705)$ (347,491)

Income taxes 22,112



Other Amounts




Goodman & Company, Investment Counsel Inc. 785 - (951) (166)


Resource industry

Dundee Energy Limited 8,722 (4,443) (4,638) (359)

United Hydrocarbon International Corp. - - (2,024) (2,024)

Dundee Sustainable Technologies Inc. - - (2,498) (2,498)



Blue Goose Capital Corp. 20,434 (22,781) 639 (1,708)




Intersegment (237) - 237 -

85,897$ (61,446)$ (122,650)$ (98,199)

Income taxes 16,637




Segmented Net Assets as at September 30, 2015

Segmented Net Assets as at December 31, 2014

ASSETS LIABILITIES

Deferred Other Corporate Other

Cash Investments Income Taxes Assets TOTAL Debt Liabilities TOTAL

Corporate and other portfolio holdings 67,173$ 650,050$ 8,556$ 50,643$ 776,422$ (92,648)$ (129,009)$ (221,657)$


Goodman & Company, Investment Counsel Inc. 672 - 2,755 433 3,860 - (1,099) (1,099)

Dundee Securities Ltd. 189,874 - 13,591 1,016,018 1,219,483 - (1,075,261) (1,075,261)

Resource industry

Dundee Energy Limited 2,146 - 9,806 166,357 178,309 (59,422) (60,278) (119,700)

United Hydrocarbon International Corp. 2,700 - - 242,004 244,704 - (17,734) (17,734)

Dundee Sustainable Technologies Inc. 3,858 - - 7,447 11,305 - (2,151) (2,151)

Eurogas International Inc. 39 - - 418 457 - (138) (138)


Blue Goose Capital Corp. 1,312 - (1,467) 117,105 116,950 (41,531) (4,009) (45,540)

AgriMarine Holdings Inc. 628 - (274) 26,475 26,829 - (3,927) (3,927)


Dundee 360 Real Estate Corporation 6,047 - (4,869) 100,882 102,060 (726) (25,691) (26,417)

TOTAL 274,449$ 650,050$ 28,098$ 1,727,782$ 2,680,379$ (194,327)$ (1,319,297)$ (1,513,624)$

ASSETS LIABILITIES

Other Corporate Deferred Other

Cash Investments Assets TOTAL Debt Income Taxes Liabilities TOTAL

Corporate and other portfolio holdings 24,457$ 1,015,696$ 42,940$ 1,083,093$ (96,069)$ (45,417)$ (155,275)$ (296,761)$


Goodman & Company, Investment Counsel Inc. 418 - 477 895 - 2,203 (411) 1,792

Dundee Securities Ltd. 198,368 - 621,386 819,754 - 9,756 (674,560) (664,804)

Resource industry

Dundee Energy Limited 829 - 175,590 176,419 (61,617) 8,108 (60,057) (113,566)

United Hydrocarbon International Corp. 9,781 - 392,440 402,221 - - (30,304) (30,304)

Dundee Sustainable Technologies Inc. 290 - 7,448 7,738 - - (2,009) (2,009)

Eurogas International Inc. 349 - 424 773 - - (135) (135)


Blue Goose Capital Corp. 2,033 - 151,933 153,966 (52,018) (4,313) (15,157) (71,488)

AgriMarine Holdings Inc. 1,174 - 37,858 39,032 - (3,983) (2,919) (6,902)


Dundee 360 Real Estate Corporation 8,104 - 105,110 113,214 (3,935) (6,514) (27,614) (38,063)

TOTAL 245,803$ 1,015,696$ 1,535,606$ 2,797,105$ (213,639)$ (40,160)$ (968,441)$ (1,222,240)$

Head Office Registrar and Transfer Agent Stock Exchange

Dundee Corporation Computershare Investor Services Inc. Toronto Stock Exchange

1 Adelaide Street East 100 University Avenue, 8th Floor

Toronto, Ontario Toronto, Ontario M5J 2Y1 Stock Symbol

M5C 2V9 Toll Free: 1.800.564.6253 DC.A

Canada Email: [email protected]

www.dundeecorporation.com

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