FORWARD-LOOKING STATEMENTS, RISKS AND UNCERTAINTIES (continued)

We are Subject to Regulation
The provincial securities regulators regulate us and our exchanges and regulators in other jurisdictions may regulate our future operations. This regulation may impose barriers or constraints which limit our ability to build an efficient, competitive organization and may also limit our ability to expand foreign and global access. Securities regulators also impose financial and corporate governance restrictions on us. Some of the provincial securities regulators must approve or review our equity exchanges’ listing rules, trading rules and fee structure, and features and operations of, or changes to our systems. These approvals or procedures may increase our costs and delay our plans for implementation.

We are Subject to Litigation Risks
Some aspects of our business involve risks of litigation. Dissatisfied customers may make claims with respect to the manner in which we operate. Although we benefit from certain contractual indemnities and limitations on liabilities, these rights may not be sufficient. In addition, with the introduction in Ontario of civil liability for misrepresentations in our continuous disclosure documents and statements, dissatisfied shareholders can more easily make claims against us. If a lawsuit or claim is resolved against us, it could have a material adverse effect on our reputation, business, financial condition and operating results.

We Depend on Market Activity that is Outside of our Control
Our revenue is highly dependent upon the level of activity on our exchanges, including: the number of transactions, volume and value of securities traded; the number and market capitalization of listed issuers; the number of new listings; the number of active traders and brokerage firms in the market; and the number of subscribers to market data.

We do not have direct control over these variables. Among other things, these variables depend upon the relative attractiveness of securities traded on our exchanges and the relative attractiveness of our exchanges as a place to trade those securities as compared to other exchanges and other trading vehicles. Those variables are in turn influenced by:

• the overall economic conditions in Canada and the United States in particular, and in the world in general (especially growth levels and political stability);
  
• interest rate environment and resulting attractiveness of alternative asset classes;
  
• the regulatory environment for investment in securities;
  
• the relative activity and performance of global capital markets;
  
• investor confidence in the prospects and integrity of listed issuers, and the prospects of Canadian-based listed issuers in general; 
  
• pricing volatility of global energy markets; and
  
• changes in tax legislation that would impact the relative attractiveness of certain types of securities.
  

We may be able to indirectly influence the volume and value of trading by providing efficient, reliable and low-cost trading; maximizing the availability of timely, reliable information upon which research, advice and investment decisions can be based; and maximizing the ease of access to trading facilities. However, those activities may not have a positive effect on, or effectively counteract the factors that are outside of our control.

We Need to Retain and Attract Qualified Personnel
Our success depends to a significant extent upon the continued employment and performance of a number of key management personnel. The loss of the services of key personnel could have a material adverse effect on our business and results of operations. We also believe that our future success will depend in large part on our ability to attract and retain highly skilled technical, managerial and marketing personnel. Competition for such personnel is intense, particularly as market conditions continue to improve. There can be no assurance that we will be successful in retaining and attracting the personnel we require.