Subsection 74(1) - issuance of shares to certain Ontario vendors and customers ofnon-reporting issuer pursuant to its directed share program in connection with its U.S.Initial public offering. First trades subject to ss. 72(5) or made through facilities of stockexchange or market outside Ontario.
Securities Act, R.S.O. 1990, c.S.5, as am., ss.25, 53, 72(5), 74(1).
Rule 14-501 Definitions.
R.S.O. 1990, CHAPTER S.5, AS AMENDED (the "Act")
IN THE MATTER OF
UPON the application (the "Application") of Onvia.com, Inc. ("Onvia.com") to theOntario Securities Commission (the "Commission") for a ruling pursuant to subsection74(1) of the Act that certain trades in the Shares of Common Stock of Onvia.com (the"Shares") to be made pursuant to a proposed Directed Share Program (the "Program") byOnvia.com with or on behalf of individuals holding senior positions with various suppliers,customers and business affiliates of Onvia.com resident in the Province of Ontario, whoelect to participate in the Program (the "Ontario Program Participants"), or by the U.S.broker dealer responsible for administering the program or by the Ontario ProgramParticipants on their own behalf, shall not be subject to section 25 or 53 of the Act;
AND UPON considering the Application and recommendation of the staff of theCommission;
AND UPON Onvia.com having represented to the Commission as follows:
1. Onvia.com is a corporation incorporated under the laws of Delaware and is not areporting issuer under the Act and has no present intention of becoming a reportingissuer under the Act.
2. Onvia.com completed an initial public offering (the "IPO") in the United States onMarch 1, 2000 and in connection therewith filed a registration statement on FormS-1, as amended (the "Preliminary Prospectus").
3. The Program is being made available to friends and family members of officers anddirectors of Onvia.com as well as to the employees and business associates ofOnvia.com ("Onvia.com Program Participants"), including the Ontario ProgramParticipants (Onvia.com Program Participants and Ontario Program Participantscollectively known as "Program Participants"), in connection with the IPO, all on thesame terms and conditions.
4. The Shares are quoted on the Nasdaq National Market.
5. Participation in the Program will be voluntary and in order to participate a ProgramParticipant will be required to complete a prospectus request form in order toreceive for review the Preliminary Prospectus.
6. In order for the Program Participants to express their interest in subscribing forShares, Program Participants will be required to complete a registration of sharesform.
7. The Shares will be offered at a price equal to the price of the Shares of CommonStock of Onvia. Com issued in connection with the IPO.
8. The Ontario Program Participants hold senior positions with various suppliers,customers and business affiliates of Onvia.com.
9. After giving effect to the IPO, the aggregate number of Shares held by OntarioProgram Participants residing in the Province of Ontario will be less than 10% of theissued and outstanding shares of Onvia.com and the number of registered Ontarioresidents holding Shares will not be more than 10% of the total number of holdersof issued and outstanding Shares of Onvia.com.
10. In accordance with the Program, the Preliminary Prospectus prepared inaccordance with U.S. securities laws will be forwarded to each Program Participant.
11. There is not expected to be a market for the Shares in Ontario and it is intendedthat any resale of Shares acquired under the Program will be effected through thefacilities of the Nasdaq National Market in accordance with its rules and regulations.
12. As a result of the nature of their expertise and the relationship between Onvia.comand the Ontario Program Participants, each of the Ontario Program Participantspossesses substantial knowledge of the business and affairs of Onvia.com. TheOntario Program Participants are sophisticated individuals involved in seniorpositions in the Canadian high technology industry and other related industries.
13. The annual reports, proxy materials and other materials generally distributed toOnvia.com shareholders resident in the United States will be provided to OntarioProgram Participants at the same time and in the same manner as the documentswould be provided to United States resident shareholders.
14. It is expected that the number of Shares to be sold under the Program will notexceed 5% of the number of Shares offered in connection with the IPO. It is alsoexpected that the Program will hold less than 1% of the total number of issued andoutstanding 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:
A. trades in Shares pursuant to the Program to, or on behalf of, the Ontario ProgramParticipants are not subject to section 25 of the Act; and
B. trades in Shares pursuant to the Program to, or on behalf of, the Ontario ProgramParticipants are not subject to section 53 of the Act, provided that the first trade inany of the Shares acquired by an Ontario Program Participant pursuant to thisruling shall be a distribution unless such trade is made in accordance with thefollowing conditions:
(i) such trade is executed in accordance with the provisions of subsection 72(5)of the Act as if such Shares had been acquired pursuant to an exemptionreferred to in subsection 72(5) of the Act, and that Onvia.com not be indefault of any requirement of the Act or the regulations if the seller is in aspecial relationship with Onvia.com, or the seller has reasonable grounds tobelieve that Onvia.com is not in default under the Act or the regulations, ifthe seller is in a special relationship with Onvia.com where, for thesepurposes, "special relationship" shall have the same meaning as inCommission Rule 14-501 Definitions; or
(ii) (a) at the time of the acquisition of the Shares by the Ontario ProgramParticipants, Onvia.com is not a reporting issuer;
(b) such trade is made through the facilities of the Nasdaq NationalMarket or such other stock exchange outside of Ontario, inaccordance with the rules of the Nasdaq National Market or suchother exchange as the case may be, and in accordance with all lawsapplicable to the Nasdaq National Market or such other exchange asthe case may be; and
(c) at the time of the acquisition of the Shares, residents of Ontario ofrecord hold not more than 10% of the issued and outstanding Sharesof Common Stock of Onvia.com and the number of Ontario residentsof record holding Shares of Common Stock is not more than 10% ofthe total number of holders of the issued and outstanding Shares ofCommon Stock of Onvia.com.
March 3rd, 2000.
"J. A. Geller" "R. Stephen Paddon"