2009 Credit Rating Report - Standard & Poors - Full Report June 11/10

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Essex (County of) below - average economic performance: The unemployment rate in the Essex - Windsor area was about 12.6% in 2009, a notable increase from the 9.0% in 2008. In addition, and as expected, income - support caseloads increased by about 16.8%. Conversely, construction activity results improved somewhat, as building permits and housing starts increased about 40.1% and 8.2%, respectively, in 2009. Nevertheless, we expect moderate diversification strategies to benefit the county's economy modestly. For example, Essex is refocusing its manufacturing away from the automotive sector, toward sectors such as alternative energy, medical equipment, aerospace, and pure and applied research and development. Capital expenditure program, liquidity, and debt Essex's capital expenditure remained elevated, at about C$23.2 million in 2008, similar to the level of spending in 2007, but notably higher than in previous years. More than two - thirds of 2010 spending went to rehabilitating and expanding the county's road network. We expect Essex's main capital expenditure in coming years to be ongoing roadwork. It expects to spend about C$8 million per year on road reconstruction and a similar amount on road expansion. Standard & Poor's believes the county's capital expenditure plan is well within its means. We believe that Essex's current liquidity is strong, and has been for many years. Cash, liquid assets, and committed facilities amounted to 71.7% of 2008 operating expenditure. In addition, own cash and cash equivalents minus own direct debt outstanding amounted to 22.5% of operating revenue in 2008, establishing the county as a significant net creditor, a position which it has maintained for many years. We expect that Essex will maintain its net creditor status. In addition, as its own liquidity improves modestly in the next three years, we also believe that Essex's liquidity position will remain amongst the strongest of its international and domestic peers. The county's own direct debt and interest expense amounted to a low 32.8% and 1.9% of operating revenues, respectively, in 2008. Debt levels fallen modestly since 2006 as a result of a lack of debt issuance and the amortizing structure of existing debt. Essex's combined debt burden (including lower -tier debt) was noticeably higher than the upper tier's direct debt profile, although still low at 50.6% of 2008 operating revenue. We expect Essex's own debt to continue its modest decline in the next three years (direct debt -to- operating revenue could fall to about 25% by 2012 by Standard & Poor's own conservative forecast). The county expects its combined debt burden to increase moderately, to 60%-65% of operating revenue. Overall, we expect Essex's debt profile to remain similar to that of similarly rated peers. Outlook The stable outlook reflects our expectation that there will be no material increase in the county's debt and that cash and investment balances will remain strong. Standard & Poor's also expects that Essex will continue to produce stable operating results. A dramatic increase in debt at the lower -tier level or a major economic deterioration could lead to a negative rating action. Table 1 County of Essex -- Economic Statistics Total Population summary* population % aged 14 years or younger % aged 65 years or older Median age 17 1 1 3.3 3 7. 5 Economic statistics (% change) 2009 2008 2007 2006 2005 Population11 1.3 1.3 1.3 1.3 1.3 www. standardandpoors .com /ratingsdirect 3 8038461300071004