Section 144 -- amendment of order granting partial revocation of cease trade order to permit issuer to complete the sale of two properties in consideration of common shares of the issuer for cancellation -- order amended to provide as a condition of relief that issuer files and delivers financial statements and continuous disclosure documents that are in arrears and applies to the Commission for a full revocation of the cease trade order by May 31, 2005 rather than April 30, 2005.
Applicable Ontario Statutory Provisions
Securities Act, R.S.O., c. S-5, as amended, s. 144
IN THE MATTER OF
THE SECURITIES ACT
R.S.O. 1990, c. S-5, AS AMENDED (the Act)
IN THE MATTER OF
VITAL RETIREMENT LIVING INC.
WHEREAS the securities of Vital Retirement Living Inc. (the Applicant) are subject to a cease trade order issued by the Ontario Securities Commission (the Commission) on May 23, 2003 (the Cease Trade Order);
AND WHEREAS by order dated November 9, 2004 the Commission granted the Applicant a partial revocation of the Cease Trade Order pursuant to Section 144 of the Act (the Partial Revocation Order) to permit trades and acts in furtherance of trades associated with the acquisition by the Applicant of approximately 7,257,000 common shares of the Applicant for cancellation, as partial consideration for the sale of two retirement homes;
AND WHEREAS the Applicant has applied to the Commission pursuant to Section 144 of the Act for an amendment of the Partial Revocation Order;
AND WHEREAS the Applicant has represented to the Commission that:
1. The Cease Trade Order was issued due to the Applicant's failure to file its annual financial statements for the year ended December 31, 2002.
2. As part of its efforts to improve its financial position, the Applicant completed a transaction (the Transaction) whereby it sold two retirement homes to an entity controlled by Mel Dancy (Dancy), a related party of the Applicant. At closing Dancy: (1) paid to the Applicant $67,000 in cash; (2) paid out mortgage debt on the two homes in the amount of approximately $2,237,000; and (3) delivered 7,257,000 common shares of the Applicant to the Applicant for cancellation.
3. As the Transaction would involve trades of securities and acts in furtherance of trades in connection with the acquisition by the Applicant of its common shares, the Transaction could not be completed without a partial revocation of the Cease Trade Order.
4. Following the issue of the Partial Revocation Order, the Transaction was completed on the terms represented by the Applicant in the Partial Revocation Order
5. The Partial Revocation Order was conditional on
(i) the Applicant filing and delivering the financial statements and continuous disclosure documents that are in arrears and applying to the Commission for a full revocation of the Cease Trade Order by April 30, 2005; and
(ii) the Applicant filing a material change report containing the information required by section 5.2 of Commission Rule 61-501 as soon as practicable following the completion of the Transaction, and in any event within 10 days.
6. The Applicant filed a material change report containing the information required by section 5.2 of Commission Rule 61-501with respect to the Transaction within the prescribed time period.
7. The Applicant compiled and delivered all required working papers to the Applicant's auditors by the end of February 2005, but has been advised by its auditors that they do not anticipate having the audit of the Applicant's financial statements completed by April 30, 2005.
8. The Applicant is continuing to work with its auditors in finalizing the audit and believes that all financial statements that are in arrears can be finalized and filed by May 31, 2005.
AND WHEREAS the Director is 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 Partial Revocation Order be amended to delete paragraph (i) and replace it with the following:
"(i) the Applicant files and delivers the financial statements and continuous disclosure documents that are in arrears and applies to the Commission for a full revocation of the Cease Trade Order by May 31, 2005; and"
April 29, 2005.