Section 144 -- application for revocation of cease trade order -- issuer subject to cease trade order as a result of its failure to file with the Commission and send to its shareholders annual financial statements -- issuer has brought filings up to date -- full revocation granted.
Applicable Ontario Statutory Provision
Securities Act, R.S.O. c. S.5, as am., ss. 127 and 144.
IN THE MATTER OF
THE SECURITIES ACT,
R.S.O. 1990, CHAPTER S.5, AS AMENDED
IN THE MATTER OF
VIRGIN METALS INC.
WHEREAS the securities of Virgin Metals Inc. (the "Issuer") are subject to a temporary order dated June 2, 2000 made by Ontario Securities Commission (the "Commission") pursuant to paragraph 2 of subsection 127(1) and subsection 127(5) of the Act, which was extended by an order of the Commission dated June 16, 2000 made pursuant to subsection 127(8) of the Act (collectively, the "Cease Trade Order"), directing that trading in securities of the Issuer cease until the Cease Trade Order is revoked by a further order of revocation;
AND WHEREAS the Issuer has made an application to the Commission pursuant to section 144 of the Act for an order revoking the Cease Trade Order;
AND WHEREAS the Issuer has represented to the Commission that:
1. The Issuer is a corporation incorporated by letters patent on January 13, 1934 under the laws of the Province of Ontario.
2. The Issuer is a reporting issuer under the Act and has been a reporting issuer in Ontario since February 27, 1934. The Issuer is not a reporting issuer or the equivalent in any other jurisdiction in Canada.
3. The authorized capital of the Issuer consists of an unlimited number of common shares ("Common Shares") of which 27,225,085 Common Shares are issued and outstanding.
4. Other than the Common Shares, the Issuer has no securities (including debt securities) outstanding.
5. The Common Shares are not listed or quoted on any exchange or market. The Common Shares were previously quoted on the CDN System under the symbol "VERG".
6. The Issuer has not carried on business since May 25, 2000. It owns no material assets or liabilities other than indebtedness owed to its creditors.
7. The Cease Trade Order was issued due to the failure of the Issuer to file and deliver annual audited financial statements for the year ended December 31, 1999 (the "December 1999 Statements"). Subsequently, the Issuer failed to file audited financial statements for the years ended December 31, 1999, 2000, 2001, 2002 and 2003 (together with the December 1999 Statements, the "Financial Statements") and interim unaudited financial statements for the first, second and third quarters for each of fiscal year 2000, 2001, 2002 and 2003 (the "Interim Statements").
8. Except for the Cease Trade Order, the Issuer is not, to its knowledge, in default of any of the requirements of the Act or the rules and regulations made thereunder, other than the following:
(a) the Issuer failed to file the Financial Statements when due;
(b) the Issuer failed to file the Interim Statements; and
(c) the Issuer failed to file press releases and material change reports in respect of certain material changes of the Issuer (the "Material Changes").
9. Notwithstanding the foregoing, it is hereby acknowledged that the Issuer recently took the following steps which may have contravened the terms of the Cease Trade Order:
(i) the Issuer entered into preliminary discussions with potential investors about a proposed financing; and
(ii) certain officers of the Issuer entered into discussions with the Cavanagh Estate with regard to acquiring all the Common Shares held by the Cavanagh Estate as well as Common Shares held by Doris Cavanagh.
10. The Financial Statements and the Interim Statements were not filed in a timely manner with the Commission or sent to the shareholders of the Issuer because the Issuer was inactive and did not have the funds necessary to prepare and mail such statements.
11. The Financial Statements and the unaudited financial statements of the Issuer for the three month period ending March 31, 2004 were filed with the Commission on SEDAR on June 15, 2004 and June 22, 2004 and were mailed to shareholders on July 2, 2004. The Issuer has also filed on SEDAR its unaudited financial statements for the three month period ending June 30, 2004.
12. The Issuer has not filed the Interim Statements because the Issuer believes that the Interim Statements would not provide additional useful information concerning the present or future operations or financial circumstances of the Issuer because during the period covered by the Interim Statements the Issuer was inactive.
13. The Issuer has undertaken to the Commission to issue a press release and material change report which will provide information on the Material Changes. The Issuer will concurrently file the press release and material change report on SEDAR.
14. The Issuer was previously known as El-Bonanza Mining Corporation, Limited (El Bonanza). During the period the Issuer was known as El-Bonanza, the Issuer was subject to a temporary order of the Commission dated November 10, 1980 which was extended by an order of the Commission dated November 21, 1980 (collectively, the "El-Bonanza Cease Trade Order"). The El-Bonanza Cease Trade Order was made as a result of the cancellation of the Issuer's charter for failure to file material required under the Corporations Tax Act, 1972 (Ontario). The El-Bonanza Cease Trade Order was partially revoked by the Commission on December 12, 1997 to permit the issuance of common shares in connection with a reverse take-over (the "RTO") involving Alamos Resources Limited. The El-Bonanza Cease Trade Order was revoked on January 13, 1998 following the completion of the RTO and the Issuer becoming current with the financial and continuous disclosure requirements of the Act.
15. The Issuer is not considering and is not involved in any discussion relating to a reverse take-over transaction or similar transaction.
AND UPON considering the application and the recommendations of staff of the Commission;
AND UPON the Commission being satisfied that to do so would not be prejudicial to the public interest;
IT IS ORDERED pursuant to section 144 of the Act that the Cease Trade Order is hereby revoked.
October 27, 2004.