Subsection 74(1) - issuance of Class B Non-Voting Shares in accordance with asettlement exempt from sections 25 and 53 of the Act, subject to certain conditions.
Securities Act, R.S.O. 1990, c. S.5, as am., ss. 25, 53, 74(1).
Rule 45-503 Trades to Employees, Executives and Consultants (1998), 21 OSCB 6569,ss. 2.2, 3.1, 9.1(1).
R.S.O. 1990, CHAPTER S.5, AS AMENDED (the "Act")
IN THE MATTER OF
MICROCELL TELECOMMUNICATIONS INC.
UPON the application of Microcell Telecommunications Inc. ("Microcell") to theOntario Securities Commission (the "Commission") for a ruling pursuant tosubsection 74(1) of the Act that the issuance by Microcell of 137,500 Class B Non-VotingShares of Microcell (the "Shares") to Martin O'Neill shall not be subject to sections 25 and53 of the Act;
AND UPON considering the application and the recommendation of the staff of theCommission;
AND UPON Microcell having represented to the Commission that:
1. Microcell was incorporated under the Canada Business Corporations Act onOctober 16, 1992, is a reporting issuer under the Act, and to the best of itsknowledge, information and belief is not in default of any requirement of the Act orthe Regulation made thereunder;
2. Microcell's authorized capital consists of an unlimited number of Common Shares,an unlimited number of Class A Non-Voting Shares, an unlimited number of ClassB Non-Voting Shares and an unlimited number of First Preferred Shares, of which32,623,971 Common Shares and 22,299,645 Class B Non-Voting Shares areissued and outstanding as of January 31, 2000;
3. Microcell's Class B Non-Voting Shares are listed on The Toronto Stock Exchangeand trade on the NASDAQ National Market;
4. Microcell is a provider of personal communications services in Canada, offeringwireless communications services in fifteen census metropolitan areas in Canada;
5. Mr. O'Neill is a resident of Ontario;
6. Mr. O'Neill was hired by Telesystem Ltd. in January 1994 to act as President andChief Executive Officer of Microcell;
7. Mr. O'Neill's employment with Microcell was terminated by Microcell on May 12,1995;
8. on June 3, 1999, the Quebec Court of Appeal rendered a judgment, as a result ofwhich Microcell was required to issue 125,000 Common Shares to Mr. O'Neill, witheffect retroactive to March 24, 1995, following a dispute with respect to Mr. O'Neill'sright to exercise a stock option in light of the termination of his employment;
9. subsequent to the judgment, Mr. O'Neill instituted further legal proceedings againstMicrocell, claiming that he had pre-emptive rights attaching to the 125,000 CommonShares retroactive to March 24, 1995, pursuant to a shareholders' agreement datedDecember 9, 1993 with respect to Microcell;
10. in order to settle the dispute between them, on February 2, 2000, a settlement wasentered into between Microcell and Mr. O'Neill pursuant to which, inter alia,Microcell agreed to issue to Mr. O'Neill an additional 137,500 Class B Non-VotingShares for an aggregate issue price of $525,000, representing the purchase pricethat Mr. O'Neill would have been required to pay had he exercised pre-emptiverights attaching to the 125,000 Common Shares since March 24, 1995;
11. as Mr. O'Neill is no longer an employee or officer of Microcell, the exemptions insections 2.2 and 3.1 of Rule 45-503 Trades to Employees, Executives andConsultants are not available for the issue by Microcell of the Shares to Mr. O'Neill;
12. Mr. O'Neill is familiar with the business and affairs of Microcell as a result of hisbeing a shareholder since 1994;
13. the Shares to be issued to Mr. O'Neill represent approximately 0.6% of theoutstanding Class B Non-Voting Shares;
AND UPON the Commission being satisfied that to do so would not be prejudicialto the public interest;
IT IS RULED, pursuant to subsection 74(1) of the Act, that the issue of the Sharesto Martin O'Neill shall not be subject to sections 25 and 53 of the Act, provided that
A. the first trade in the Shares is made in accordance with the provisions of subsection9.1(1) of Rule 45-503 Trades to Employees, Executives and Consultants, as if theShares had been acquired pursuant to the exemption in section 3.1 of Rule 45-503Trades to Employees, Executives and Consultants; and
B. prior to the issuance of the Shares, Microcell provides to Mr. O'Neill a copy of thisruling, together with a statement that, as a consequence of this ruling, certainprotections, rights and remedies provided by the Act, including statutory rights ofrescission or damages, will not be available to Mr. O'Neill.
February 25th, 2000.
"Howard I. Wetston" "J.F. Howard"