Securities Law & Instruments

Headnote

Subsection 83.1(1) -- issuer deemed to be a reporting issuer in Ontario -- issuer a reporting issuer in Alberta and British Columbia -- issuer's securities listed for trading on the TSX Venture Exchange -- continuous disclosure requirements in Alberta and British Columbia substantially the same as those in Ontario -- issuer had a significant connection to Ontario

Statutes Cited

Securities Act, R.S.O. 1990, c. S.5, as am., ss. 83.1(1).

IN THE MATTER OF

THE SECURITIES ACT,

R.S.O. 1990, c. S.5, AS AMENDED, (the "Act")

AND

IN THE MATTER OF

MEDORO RESOURCES LTD.

 

ORDER

(Subsection 83.1(1))

UPON the application (the "Application") of Medoro Resources Ltd. (the "Corporation") to the Ontario Securities Commission (the "Commission") for an order pursuant to subsection 83.1(1) of the Act deeming the Corporation to be a reporting issuer for the purposes of Ontario securities laws;

AND UPON considering the Application and the recommendation of the staff of the Commission;

AND UPON the Corporation having represented to the Commission as follows:

    1. Medoro is a company governed by the Business Corporations Act (Yukon) (the "YBCA") that was formed pursuant to the amalgamation of Full Riches Investments Ltd. ("Full Riches") and Medoro Resources Ltd. ("Predecessor Medoro") effective February 24, 2004.

    2. Predecessor Medoro was incorporated under the provisions of the YBCA pursuant to the issuance of a certificate of incorporation dated November 14, 2003.

    3. Full Riches was incorporated under the provisions of the Company Act (British Columbia) pursuant to a certificate of incorporation dated December 1, 1980 and was continued under the YBCA pursuant to articles of continuance dated January 21, 2004. Full Riches was a reporting issuer under the Securities Act (Alberta) and the Securities Act (British Columbia) for over a year.

    4. The head office of Medoro is located at 110 Yonge Street, Suite 1502, Toronto, Ontario M5C 1T4. The registered office of Medoro is located at The Drury Building, 3081 Third Avenue, Whitehorse, Yukon Y1A 4Z7.

    5. The authorized capital of Medoro consists of an unlimited number of common shares and an unlimited number of preferred shares issuable in series, of which 81,882,043 common shares and no preferred shares are issued and outstanding. An aggregate of 6,570,917 common shares of Medoro are also reserved for issuance on the exercise of warrants granted by Medoro. A further aggregate of 3,687,888 common shares of Medoro are also reserved for issuance on the exercise of stock options granted by Medoro.

    6. Medoro is a reporting issuer under the Securities Act (Alberta) and the Securities Act (British Columbia). Medoro's common shares were listed on the TSX Venture Exchange (the "TSXVE") on March 2, 2004 and currently trade under the trading symbol "MRL".

    7. Medoro has a significant connection to Ontario as its mind and management are principally located in Toronto, Ontario. In addition, while Medoro is not aware of the number of beneficial shareholders resident in the Province of Ontario, Medoro has ten registered shareholders resident in the Province of Ontario, including CDS & Co., which hold an aggregate of 32,847,656 common shares, representing approximately 40.1% of the issued and outstanding shares of Medoro. Not including CDS & Co., Medoro has registered shareholders resident in Ontario which hold an aggregate of 5,414,500 common shares, representing approximately 6.6% of the issued and outstanding common shares of Medoro. Medoro believes that it is reasonable to assume that beneficial shareholders of Medoro resident in Ontario own in excess of 10% of the issued and outstanding shares of Medoro.

    8. The continuous disclosure requirements of the Securities Act (Alberta) and the Securities Act (British Columbia) are substantially the same as the requirements under the Act. The materials filed by Medoro and its predecessor Full Riches as a reporting issuer in the provinces of Alberta and British Columbia are available on the System for Electronic Document Analysis and Retrieval.

    9. Medoro is not on the list of defaulting reporting issuers maintained pursuant to the Securities Act (Alberta) and the Securities Act (British Columbia). Medoro is not in default of any requirement of the TSXVE.

    10. To the knowledge of Medoro and its directors or officers, none of Medoro, its directors or officers nor any shareholder holding sufficient securities of Medoro to affect materially its control is or has been subject to:

      (i) any known or ongoing or concluded investigations by:

        (a) a Canadian securities regulatory authority, or

        (b) a court or regulatory body, other than the Canadian securities regulatory authority, that would be likely to be considered important to a reasonable investor making an investment decision; or

      (ii) any bankruptcy or insolvency proceedings, or other proceedings, arrangements or compromises with creditors, or the appointment of a receiver, receiver-manager or trustee, within the preceding 10 years.

    11. None of Medoro, its officers or directors nor any shareholder holding sufficient securities of Medoro to affect materially its control has:

      (i) been the subject of any penalties or sanctions imposed by a court relating to Canadian securities legislation or by a Canadian securities regulatory authority;

      (ii) entered into a settlement agreement with a Canadian securities regulatory authority; or

      (iii) been subject to any other penalties or sanctions imposed by a court or regulatory body that would be likely to be considered important to a reasonable investor making an investment decision.

    12. Other than disclosed below, none of the directors or officers of Medoro, nor any shareholder holding sufficient securities of Medoro to affect materially its control, is or, within 10 years before the date hereof, has been, a director or officer of another issuer that, while the person was acting in that capacity, was the subject of a cease trade or similar order, or an order that denied access to any exemptions under securities laws, for a period of more than 30 consecutive days or became bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency or was subject to or instituted any proceedings, arrangement or compromise with creditors or had a receiver, receiver manager or trustee appointed to hold its assets,

    13. Miguel de la Campa and Serafino Iacono, both directors of Medoro, who are both directors of Chivor Emerald Corporation Limited, are the subject of a cease trade order of the Commission dated June 15, 2000 due to the failure to file financial statements within prescribed time periods.

AND UPON the Commission being satisfied that to do so would not be prejudicial to the public interest;

IT IS HEREBY ORDERED pursuant to subsection 83.1(1) of the Act that the Corporation be deemed to be a reporting issuer for the purposes of the Act.

July 20, 2004.

"Erez Blumberger"