Mutual Reliance Review System for Exemptive Relief Applications -- application for an order that the issuer is not a reporting issuer.
Applicable Ontario Statutory Provisions
Securities Act, R.S.O. 1990, c. S.5, as am., s. 1(10).
June 12, 2007
IN THE MATTER OF
THE SECURITIES LEGISLATION OF
ALBERTA AND ONTARIO
IN THE MATTER OF
THE MUTUAL RELIANCE REVIEW SYSTEM
FOR EXEMPTIVE RELIEF APPLICATIONS
IN THE MATTER OF
GROVE ENERGY LIMITED
MRRS DECISION DOCUMENT
1. The local securities regulatory authority or regulator (the Decision Maker) in Alberta and Ontario (the Jurisdictions) has received an application from Grove Energy Limited (the Filer) under the securities legislation of the Jurisdictions (the Legislation) for a decision to be deemed to have ceased to be a reporting issuer in the Jurisdictions in accordance with the Legislation.
2. Pursuant to the Mutual Reliance Review System for Exemptive Relief Applications (the System), the Alberta Securities Commission is the principal regulator for this application.
3. Defined terms contained in National Instrument 14-101 Definitions have the same meaning in this decision unless they are defined in this decision.
4. This decision is based on the following facts represented by the Filer:
(a) The Filer is a corporation existing under the laws of the Province of British Columbia. Prior to its acquisition by Stratic Energy Corporation (Stratic), the Filer's head office was located in Vancouver, British Columbia.
(b) Stratic is a corporation existing under the laws of the Yukon Territory with its Canadian head office located in Calgary, Alberta.
(c) The authorized share capital of the Filer consists of an unlimited number of common shares, of which 138,084,560 common shares are issued and outstanding. The Filer also has outstanding US$15,000,000 aggregate principal amount of five-year 8.75% subordinated convertible debentures (the Debentures). The Debentures were issued pursuant to a private placement and are beneficially owned by seven holders, none of whom are resident in Canada.
(d) On April 24, 2007, Stratic acquired all of the issued and outstanding common shares of the Filer pursuant to an arrangement under the Business Corporations Act (British Columbia).
(e) The Filer and Stratic are both reporting issuers under the Legislation.
(f) The Filer ceased to be a reporting issuer under the securities legislation of British Columbia on May 24, 2007 pursuant to the procedure set forth in BC Instrument 11-502 Voluntary Surrender of Reporting Issuer Status.
(g) The outstanding securities of the Filer, including debt securities, are beneficially owned, directly or indirectly, by less than 15 security holders in each of the jurisdictions in Canada and less than 51 security holders in total in Canada.
(h) The common shares of the Filer were delisted from the TSX Venture Exchange at the close of business on April 30, 2007 and no securities of the Filer are traded on a marketplace as defined in National Instrument 21-101 Marketplace Operation.
(i) The Filer has no current intention to seek public financing by way of an offering of securities.
(j) The Filer is applying for relief to cease to be a reporting issuer in all of the jurisdictions in Canada in which it is currently a reporting issuer.
(k) A cease trade order was issued against the Filer by the Ontario Securities Commission (the OSC) on May 25, 2007 (the Cease Trade Order) for failure to file audited financial statements and related management's discussion and analysis for the financial year ended December 31, 2006 as required by Ontario securities law. Pursuant to an order granted by the OSC dated June 7, 2007 the Cease Trade Order will be revoked effective as of the date on which the Filer ceases to be a reporting issuer under the Securities Act (Ontario).
(l) The Filer is not in default of any of its obligations under the Legislation as a reporting issuer other than the requirements to file: (i) annual audited financial statements and related management's discussion and analysis for the year ended December 31, 2006; (ii) interim financial statements and related management's discussion and analysis for the interim period ended March 31, 2007; (iii) annual certificates and interim certificates under Multilateral Instrument 52-109 Certification of Disclosure in Issuers' Annual and Interim Filings in respect of its annual filings for the year ended December 31, 2006 and its interim filings for the interim period ended March 31, 2007; and (iv) the documents required under Part 2 of National Instrument 51-101 Standards of Disclosure for Oil and Gas Activities in respect of the year ended December 31, 2006.
5. Pursuant to the System, this MRRS Decision Document evidences the decision of each Decision Maker.
6. Each of the Decision Makers is satisfied that the test contained in the Legislation that provides the Decisions Maker with the jurisdiction to make the decision has been met.
7. The decision of the Decision Makers under the Legislation is that the Filer be deemed to have ceased to be a reporting issuer under the Legislation.