Mr. David Levi reports

MATRIX AND GROWTHWORKS UPDATE STATUS OF REGULATORY WORKING CAPITAL

Matrix Asset Management Inc. and its subsidiaries, GrowthWorks Capital Ltd. and Seamark Asset Management Ltd., continue to pursue measures for re-establishing compliance with regulatory working capital requirements.

On May 15, 2013, Matrix announced its operating results for the quarter ended March 31, 2013, including a consolidated working capital deficit of $7.0-million. Matrix announced that the working capital deficit has caused levels of working capital in Matrix's two registered subsidiaries to fall below regulatory working capital requirements. Each of GWC and Seamark is registered as an investment fund manager and portfolio manager under Canadian securities laws. It is a condition of registration that these subsidiaries comply with regulatory working capital requirements.

Matrix has arranged for loan financing from Marquest Asset Management Inc. in connection with the proposed business combination of Marquest and Matrix. To date, $1-million has been advanced to Matrix and Matrix anticipates that a further $2-million would be advanced in the near term. The parties are reviewing the structure of the business combination and the operations of the businesses going forward, including how to consolidate portfolio management and fund management activities into two of the three registered entities that exist now within the parties' respective corporate groups. To that end, Matrix is examining the steps required to consolidate the operations of GWC into Seamark for greater efficiency and to enhance Matrix's ability to maintain compliance with regulatory working capital requirements. Consolidating GWC's operations into Seamark would be subject to approval by the boards of directors or other governing bodies of managed venture capital funds and mutual funds and may be subject to regulatory approval. The transaction remains subject to shareholder, stock exchange and regulatory approvals. There can be no assurance that the consolidation of operations will occur, that the transaction will be completed on the terms proposed or at all or that anticipated loan advances will be made.

We seek Safe Harbor.