Securities Law & Instruments

Headnote

Section 144 - application for variation of cease trade order - issuer cease traded due to failure to file with the Commission and send to shareholders annual financial statements - issuer has applied for a variation of the cease trade order to permit the issuer to proceed with a private placement - potential investors to receive copy of cease trade order and partial revocation order prior to making investment decision - partial revocation granted subject to conditions.

Statutes Cited

Securities Act, R.S.O. 1990, c. S.5, as am., ss. 127, 144.

Rules Cited

National Instrument 45-106 -- Prospectus and Registration Exemptions.

National Policy 12-202 -- Revocation of a Compliance-related Cease Trade Order.

December 7, 2007

IN THE MATTER OF

THE SECURITIES ACT,

R.S.O. 1990, C.S.5, AS AMENDED

(the Act)

AND

IN THE MATTER OF

ATEBA TECHNOLOGY & ENVIRONMENTAL INC.

 

ORDER

(Section 144)

WHEREAS the securities of Ateba Technology & Environmental Inc. (the Applicant) are subject to a cease trade order issued on May 23, 2003 made pursuant to paragraph 2 of subsection 127(1) and subsection 127(5) of the Act, as extended by a further order dated June 4, 2003 made pursuant to subsection 127(8) of the Act (together, the Cease Trade Order);

AND WHEREAS the Applicant has applied to the Ontario Securities Commission (the Commission) pursuant to section 144 of the Act (the Application) for a partial revocation of the Cease Trade Order;

AND WHEREAS the Applicant has represented to the Commission that:

1. The Applicant was formed by articles of amalgamation under the Business Corporations Act (Ontario) on February 1, 1988.

2. The Applicant's registered and head office is located at 130 King Street West, Suite 3680, Toronto, Ontario, M5X 1B1.

3. The Applicant's authorized capital consists of an unlimited number of common shares (the Common Shares) and special shares (the Special Shares), issuable in series, of which 29,450,901 Common Shares and no Special Shares are issued and outstanding.

4. The Applicant's principal asset consists of twenty-five (25) patented (surface and mining rights) mining claims located in Gunterman and Joubin Township, Ontario.

5. Prior to the issuance of the Cease Trade Order, the Common Shares of the Applicant were traded on the Canadian Venture Exchange. The Common Shares have since been de-listed from the Canadian Venture Exchange. The Applicant has no securities, including debt securities, that are currently listed or quoted on any exchange or market in Canada or elsewhere.

6. The Cease Trade Order was issued due to the failure of the Applicant to file and mail to its shareholders (the Shareholders) audited financial statements for the year ended December 31, 2002. No further financial statements have been filed or mailed to the Shareholders since that time and no further continuous disclosure documents required by applicable securities legislation have been filed by the Applicant since that time.

7. The Applicant's failure to file financial statements commencing with the year ended December 31, 2002 was a result of financial distress. The Applicant had expended all of its resources in connection with a failed business combination and there were insufficient funds available to prepare the required financial statements and retain auditors to audit them.

8. The Applicant is a reporting issuer or the equivalent under the securities legislation of the Provinces of Ontario, British Columbia, Alberta and Quebec. The Applicant is not a reporting issuer in any other jurisdiction in Canada.

9. In addition to the Cease Trade Order, the Applicant is subject to the following cease trade orders, each of which was issued due to the failure of the Applicant to file and mail to its Shareholders audited financial statements for the year ended December 31, 2002:

(a) order issued by the British Columbia Securities Commission (the BCSC) on June 3, 2003, as extended by a further order dated June 2, 2004;

(b) order issued by the Alberta Securities Commission (the ASC) on June 17, 2004, as extended by a further order dated June 30, 2004; and

(c) order issued by the Autorité des marchés financiers (the AMF and together with the BCSC and the ASC, the Securities Regulators) on May 26, 2003.

10. The Applicant is currently inactive and is seeking to effect the following transactions to enable the Applicant to reactivate its business, one or more of which, or the actions associated therewith, may constitute a contravention of the Cease Trade Order: completion of the following brokered private placements of its Common Shares (together, the Private Placement) with accredited investors (as such term is defined in National Instrument 45-106 -- Prospectus and Registration Exemptions) resident in the Province of Ontario or to investors resident in offshore jurisdictions (each a Potential Investor) to raise gross proceeds of up to $1,050,000:

(i) 75,000,000 Common Shares at a price of $0.01 per share; and

(ii) 10,000,000 Common Shares at a price of $0.03 per share.

11. As the Private Placement will involve trades in securities of the Applicant (including, for greater certainty, acts in furtherance of trades in securities of the Applicant), the Private Placement cannot be completed without a variation of the Cease Trade Order.

12. The Private Placement will be completed in accordance with all applicable laws.

13. Prior to completion of the Private Placement, each Potential Investor will receive:

(a) a copy of the Cease Trade Order;

(b) a copy of this Order; and

(c) written notice from the Applicant, and will acknowledge, that all of the Applicant's securities, including the Common Shares issued in connection with the Private Placement, will remain subject to the Cease Trade Order until it is revoked, and that the granting of this Order does not guarantee the issuance of a full revocation order in the future.

14. The Applicant is not in default of any requirements of the Cease Trade Order or the Act or the rules and regulations made pursuant thereto, subject to the deficiencies outlined in paragraph 6 above.

15. Upon the issuance of this Order, the Applicant will:

(a) issue a press release and file a material change report announcing, among other things, the Private Placement and this Order;

(b) market the Private Placement and provide information relating to the Applicant to the Potential Investors in accordance with the provisions of this Order and in accordance with the Act and the rules and regulations made pursuant thereto; and

(c) issue Common Shares in connection with the Private Placement.

16. To bring its continuous disclosure record up to date, the Applicant intends, within a reasonable time following the completion of the Private Placement, to file the following documents on SEDAR once completed (collectively, the SEDAR Documents):

(a) the financial statements for the years ended December 31, 2006, December 31, 2005, December 31, 2004, December 31, 2003 and December 31, 2002 and the related management's discussion and analysis;

(b) its interim financial statements for the interim periods ending March 31, 2003 and the related management's discussion and analysis;

(c) all certifications by the Chief Executive Officer and the Chief Financial Officer of the Applicant with respect to the Applicant's annual and interim filings required by Multilateral Instrument 52-109 -- Certification of Disclosure in Issuers' Annual and Interim Filings; and

(d) all other continuous disclosure documents required by applicable securities legislation to be filed by the Applicant.

17. The Applicant will use the proceeds from the Private Placement to:

(a) complete the audit and filing of the SEDAR Documents, as required;

(b) pay all outstanding participation fees, filing fees and late fees owing to the Commission; and

(c) pay certain other fees currently owing by the Applicant.

18. The Applicant intends, within a reasonable time following the completion of the Private Placement, to apply to the Commission and the Securities Regulators for a full revocation of the Cease Trade Order and the cease trade orders imposed by each of the Securities Regulators.

19. The Applicant is not considering, nor is it involved in any discussion relating to a reverse take-over, merger, amalgamation or other form of combination or transaction similar to any of the foregoing.

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

AND WHEREAS the Director 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 partially revoked solely to permit trades in securities of the Applicant (including, for greater certainty, acts in furtherance of trades in securities of the Applicant) that are necessary for and are in connection with the Private Placement provided that:

(a) prior to completion of the Private Placement each Potential Investor:

(i) receives a copy of the Cease Trade Order;

(ii) receives a copy of this Order; and

(iii) receives written notice from the Applicant, and acknowledges, that all of the Applicant's securities, including the Common Shares issued in connection with the Private Placement, will remain subject to the Cease Trade Order until it is revoked, and that the granting of this Order does not guarantee the issuance of a full revocation order in the future.

(b) this Order will terminate on the earlier of:

(i) completion of the Private Placement; and

(ii) 60 days from the date hereof.

"Jo-Anne Matear"
Assistant Manager
Ontario Securities Commission