Securities Law & Instruments

Headnote

Consent given to OBCA corporation to continue under the laws of the Province of British Columbia.

Statutes Cited

Business Corporations Act, R.S.O. 1990, c. B.16, s.181.

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

Regulations Cited

Regulation made under the Business Corporations Act, R.R.O. 1990, Reg. 289, as am., s. 4(b).


IN THE MATTER OF
THE REGULATION MADE UNDER
THE BUSINESS CORPORATIONS ACT R.S.O. 1990
c. B.16
(the “OBCA”)
R.R.0. 1990, REGULATION 289/00,
AS AMENDED
(the “Regulation”)

AND

IN THE MATTER OF
ZARA RESOURCES INC.

CONSENT
(Subsection 4(b) of the Regulation)



UPON the application of Zara Resources Inc. (the "Applicant") to the Ontario Securities Commission (the "Commission") requesting the consent from the Commission, pursuant to subsection 4(b) of the Regulation, for the Applicant to continue into the Province of British Columbia, (the "Continuance") pursuant to Section 181 of the OBCA;

AND UPON considering the application and the recommendation of the staff of the Commission;

AND UPON the Applicant having represented to the Commission that:

1. The Applicant was incorporated under the OBCA by articles of incorporation effective October 9, 2012.

2. The Applicant's registered and head office is located at 208 Queens Quay West, Suite 2506, Toronto, ON M5J 2Y5.

3. The authorized capital of the Applicant consists of an unlimited number of common shares ("Common Shares"), an unlimited number of series A preferred shares ("Series A Preferred Shares"), and an unlimited number of series B preferred shares ("Series B Preferred Shares") of which there are currently issued and outstanding 33,396,005 Common Shares, 455,000 Series A Preferred Shares and 4,750,000 Series B Preferred Shares. The Common Shares of the Applicant are listed for trading on the Canadian National Stock Exchange under the symbol "ZRI". The Applicant does not have any securities listed on any other exchange, except for the Canadian National Stock Exchange.

4. The Applicant intends to apply to the Director under the OBCA pursuant to Section 181 of the OBCA (the "Application for Continuance") for authorization to continue into the Province of British Columbia under the Business Corporations Act (British Columbia), S.B.C. 2002, c. 57 (the "BCBCA") under its current name. The Applicant does not intend to change its name in connection with the Continuance.

5. Pursuant to subsection 4(b) of the Regulation, the Application for Continuance must, in the case of an "offering corporation" (as the term is defined in the OBCA), be accompanied by a consent from the Commission.

6. The Applicant is an "offering corporation" under the OBCA and is a reporting issuer under the Securities Act (Ontario) R.S.O. 1990, c. S.5, as amended (the "Act"), and is also a reporting issuer under the securities legislation of British Columbia and Alberta. The Applicant is not a reporting issuer or the equivalent in any other jurisdiction.

7. The general nature of the Applicant's business is exploration, development, exploitation and acquisition of mineral properties.

8. The Applicant's only subsidiary is Leo Resources Inc., which is wholly-owned by the Applicant.

9. The Applicant is not in default under any provision of the OBCA and the Act, or any of the regulations or rules made under the OBCA and the Act or under the securities legislation of any other jurisdiction in which it is a reporting issuer.

10. The Applicant is not a party to any proceeding or, to the best of its information, knowledge or belief, any pending proceeding under the OBCA and the Act or under the securities legislation of any other jurisdiction where it is a reporting issuer.

11. A summary of the material provisions respecting the proposed Continuance was provided to the shareholders of the Applicant in the management information circular of the Applicant dated April 5, 2013 (the "Circular") in respect of the Applicant's special meeting of shareholders held on May 14, 2013 (the "Meeting"). The Circular was mailed to shareholders of record at the close of business on April 4, 2013 and was filed on SEDAR on April 8, 2013.

12. In accordance with the OBCA and the Act and the Applicant's constating documents, the special resolution of shareholders to be obtained at the Meeting in connection with the proposed Continuance (the "Continuance Resolution") required the approval of a minimum majority of 66 2/3% of the aggregate votes cast by the shareholders present in person or by proxy at the Meeting. Each shareholder is entitled to one vote for each Common Share held.

13. The Applicant's shareholders had the right to dissent with respect to the proposed Continuance pursuant to Section 185 of the OBCA, and the Circular disclosed full particulars of this right in accordance with the applicable law.

14. The Continuance Resolution was approved at the Meeting by 99.967% of the votes cast by the shareholders of the Applicant in respect of the Continuance Resolution. None of the shareholders of the Applicant exercised dissent rights pursuant to section 185 of the OBCA.

15. The Applicant believes that certain aspects of the BCBCA will better facilitate the Applicant's business and affairs than the OBCA. In particular, the BCBCA will offer the Applicant greater flexibility with respect to the recruitment of non-resident directors.

16. Following the Continuance:

(a) the Applicant intends to remain a reporting issuer in Ontario and in each of the other jurisdictions where it is currently a reporting issuer;

(b) the Applicant's registered office will be located in Vancouver, British Columbia; and

(c) the Applicant will apply to make the British Columbia Securities Commission its principal regulator.

17. The material rights, duties and obligations of a corporation governed by the BCBCA are substantially similar to those of a corporation governed by the OBCA.

AND UPON the Commission being satisfied that to do so would not be prejudicial to the public interest;

THE COMMISSION HEREBY CONSENTS to the continuance of the Applicant as a corporation under the BCBCA.

DATED at Toronto, Ontario this 7th day of June, 2013.

"Edward P. Kerwin"
Commissioner
Ontario Securities Commission
 
"Deborah Leckman"
Commissioner
Ontario Securities Commission