Securities Law & Instruments

Headnote

Mutual Reliance Review System for Exemptive Relief Applications -- National Instrument 51-102 Continuous Disclosure Obligations- exemption from the requirement in item 14.2 of Form 51-102F5 Information Circular to include in an information circular the disclosure as prescribed by the form of prospectus, other than the short form prospectus, that an entity would be eligible to use for a distribution of securities - information circular to be circulated in connection with an arrangement - alternate disclosure will be provided about the entity that will comply with the short form prospectus rule - information will be provided about the parties to the transaction sufficient for shareholders to assess the transaction as a whole.

Applicable Legislative Provisions

National Instrument 51-102 Continuous Disclosure Obligations, s. 13.1.

Form 51-102F5 Information Circular, item 14.2.

Citation: TriStar Oil & Gas Ltd., Real Resources Inc., 2007 ABASC 435

June 28, 2007

IN THE MATTER OF

THE SECURITIES LEGISLATION

OF ALBERTA AND ONTARIO

(THE JURISDICTIONS)

AND

IN THE MATTER OF

THE MUTUAL RELIANCE REVIEW SYSTEM

FOR EXEMPTIVE RELIEF APPLICATIONS

AND

IN THE MATTER OF

TRISTAR OIL & GAS LTD. (TRISTAR)

AND REAL RESOURCES INC. (REAL)

 

MRRS DECISION DOCUMENT

Background

1. The local securities regulatory authority or regulator (the Decision Maker) in each of the Jurisdictions has received an application from TriStar and Real for a decision under the securities legislation of the Jurisdictions (the Legislation) that Tristar and Real be exempt from the requirement under Item 14.2 of Form 51-102F5 Information Circular (Form 51-102F5) to include in a joint information circular (the Information Circular) for the Arrangement (defined below) the disclosure about TriStar as prescribed by the form of prospectus, other than a short form prospectus under National Instrument 44-101 Short Form Prospectus Distributions (the Short Form Prospectus Rule), that TriStar would be eligible to use for a distribution of securities (the Long Form Prospectus Form) provided that the Information Circular includes information about Tristar required by the Short Form Prospectus Rule.

Application of Principal Regulator System

2. Under Multilateral Instrument 11-101 Principal Regulator System (MI 11-101) and the Mutual Reliance Review System for Exemption Relief Applications:

(a) the Alberta Securities Commission is the principal regulator for TriStar and Real;

(b) TriStar and Real are relying on the exemption in Part 3 of MI 11-101 in all of the provinces in Canada except Alberta and Ontario; and

(c) this MRRS decision document evidences the decision of each Decision Maker.

Interpretation

3. Defined terms contained in National Instrument 14-101 Definitions have the same meaning in this decision unless they are otherwise defined in this decision.

Representations

4. This decision is based on the following facts represented by the TriStar and Real:

(a) Each of TriStar and Real is incorporated under the laws of the Province of Alberta and has its head office located in Calgary, Alberta.

(b) The common shares of TriStar are listed and posted for trading on the Toronto Stock Exchange under the trading symbol "TOG".

(c) The common shares of Real are listed and posted for trading on the Toronto Stock Exchange under the trading symbol "RER".

(d) TriStar is a reporting issuer, where such status exists, in each of the provinces of Canada and has been a reporting issuer in at least one of these jurisdictions since on or about January 5, 2006.

(e) Real is a reporting issuer, where such status exists, in each of the provinces of Canada and has been a reporting issuer in at least one of these jurisdictions since at least January 1, 2006.

(f) TriStar is not in default of any of its obligations as a reporting issuer pursuant to the applicable securities legislation in any of the provinces in which it is a reporting issuer.

(g) Real is not in default of any of its obligations as a reporting issuer pursuant to the applicable securities legislation in any of the provinces in which it is a reporting issuer.

(h) Tristar satisfies the basic qualification criteria as set out in section 2.2 of the Short Form Prospectus Rule. In particular, Tristar filed on or about March 16, 2007 its annual information form for the year ended December 31, 2006, and filed on or about March 15, 2007 its annual financial statements for the year ended December 31, 2006 and related management's discussion and analysis.

(i) Tristar has a current AIF and current annual financial statements as defined in section 1.1 of the Short Form Prospectus Rule.

(j) TriStar has filed the notice required by section 2.8 of the Short Form Prospectus Rule and that notice has not been withdrawn.

(k) On May 22, 2007, TriStar and Real entered into an arrangement agreement pursuant to which TriStar and Real will combine pursuant to a Plan of Arrangement (the Arrangement) under the Business Corporations Act (Alberta) (the ABCA). Pursuant to the Arrangement, holders (TriStar Shareholders) of common shares of TriStar (TriStar Shares) will receive, for each TriStar Share, 0.4762 of a common share of Real (Real Share), and holders (Real Shareholders) of Real Shares will continue to hold one Real Share for each Real Share held prior to the Arrangement. Following the Arrangement, the name of Real Resources Inc. will be changed to "TriStar Oil and Gas Ltd.".

(l) Following the completion of the Arrangement, TriStar will be a wholly owned subsidiary of Real. The name of Real will be changed to "TriStar Oil & Gas Ltd." And the name of TriStar will be changed from "TriStar Oil & Gas Ltd." To another name that is yet to be determined. The arrangement agreement contains a covenant that the two companies will be amalgamated effective January 1, 2008.

(m) The Information Circular detailing the Arrangement is anticipated to be mailed to Real Shareholders and TriStar Shareholders on or about July 3, 2007 for meetings expected to take place on or about August 2, 2007. Closing of the Arrangement is expected to take place on or about August 3, 2007.

(n) Form 51-102F5 requires that the Information Circular contain, among other things, a detailed description of the Arrangement and disclosure (including financial statements) for Tristar prescribed by the form of prospectus, other than a short form prospectus under the Short Form Prospectus Rule, that Tristar would be eligible to use for a distribution of securities in the Jurisdictions.

(o) The form of prospectus other than a short form prospectus under the Short Form Prospectus Rule that Tristar would be eligible to use for a distribution of securities is the form of prospectus prescribed by Ontario Securities Commission Form 41-501F1 Information Required in a Prospectus.

(p) The Information Circular will include, among other things, a detailed description of the Arrangement and the disclosure (including financial statements) for Tristar prescribed by Form 44-101F1 -- Short Form Prospectus (Form 44-101F1).

(q) The Information Circular will incorporate by reference all documents of the type described in item 11.1 of Form 44-101F1 filed by Tristar after the date of the Information Circular and before the date of the Meeting.

(r) The Information Circular will contain sufficient information for shareholders to make a reasoned decision about whether to approve the Arrangement.

Decision

5. The Decision Makers are satisfied that they each have jurisdiction to make this decision and that the relevant test contained under the Legislation has been met. The Decision of the Decision Makers is that Tristar and Real are exempt from the requirement under Item 14.2 of Form 51-102F5 to include in the Information Circular for the Arrangement the disclosure about TriStar prescribed by the Long Form Prospectus Form provided that:

(a) at the time of filing of the Information Circular, Tristar satisfies the basic qualification criteria as set out in section 2.2 of the Short Form Prospectus Rule; and

(b) the Information Circular (and the documents incorporated by reference in the Information Circular) includes information about Tristar required by the Short Form Prospectus Rule to be included or incorporated by reference in a short form prospectus.

"Agnes Lau", CA
Associate Director, Corporate Finance
Alberta Securities Commission