IN THE MATTER OF
THE SECURITIES ACT,
R.S.O., 1990, c. S.5, AS AMENDED
IN THE MATTER OF
NORTHERN SUN EXPLORATION COMPANY INC.
WHEREAS the securities of Northern Sun Exploration Company Inc. ("Northern Sun") are subject to a cease trade order made by the Director dated March 23, 2009 (the "Cease Trade Order") pursuant to subsections 127(1) and 127(5) of the Act directing that all trading in the securities of Northern Sun cease until the order is revoked by the Director;
AND WHEREAS the Cease Trade Order was made on the basis that Northern Sun was in default of certain filing requirements under Ontario securities law as described in the Cease Trade Order and outlined below;
AND WHEREAS Northern Sun has applied to the Ontario Securities Commission (the "Commission") for an order pursuant to Section 144 of the Act to revoke the Cease Trade Order;
AND UPON Northern Sun having represented to the Commission that:
1. Northern Sun was incorporated under the Company Act (British Columbia) on September 5, 1975 under the name Landmark Resources Ltd. On October 6, 1995, Northern Sun changed its name to Landmark Environmental Inc., on June 12, 1997, Northern Sun changed its name to International Landmark Environmental Inc., on January 15, 2003, Northern Sun changed its name to Shabute Ventures Inc. and on June 29, 2004, it changed its name to Northern Sun Exploration Company Inc. The location of Northern Sun's head office is at Suite 1910-1055 West Hastings Street, Vancouver, BC, V6E 2E9. Northern Sun has been inactive from March 2009 until present.
2. Northern Sun is a reporting issuer in British Columbia, Alberta and Ontario (the "Reporting Jurisdictions"), and is not a reporting issuer in any other jurisdiction.
3. Northern Sun's authorized capital structure consists of an unlimited number of common shares without nominal or par value. As of the date hereof, there are 111, 203,812 common shares issued and outstanding. Northern sun also previously issued a convertible debenture with a corporation in which two (2) insiders of Northern Sun are major shareholders. The convertible debenture is a debt instrument and may not be converted into common shares until Northern Sun has been released from insolvency protection and the Cease Trade Order has been revoked. Other than the common shares and the convertible debenture, Northern Sun has no other securities issued and outstanding.
4. The common shares of Northern Sun are listed on the NEX board of the TSX Venture Exchange under the symbol "NSE.H" but are currently suspended from trading. Northern Sun is only listed on the NEX board at this time and is not listed on any other exchange, marketplace or facility.
5. The Commission made the decision ordering that trading cease in respect of the securities of Northern Sun because Northern Sun failed to file its audited annual financial statements and MD&A for the year ended October 31, 2008. A temporary cease trade order was made by the Director on March 11, 2009, which order was then subsequently extended on March 23, 2009 until further order of the Director.
6. Northern Sun is also subject to a cease trade order issued by the British Columbia Securities Commission on March 11, 2009 for the Company's failure to file its audited annual financial statements and MD&A for the year ended October 31, 2008. Northern Sun has applied for a revocation of the cease trade order issued by the British Columbia Securities Commission concurrent with its application to the Commission.
7. Northern Sun is also subject to a cease trade order issued by the Alberta Securities Commission on March 6, 2009 for the Company's failure to file its audited annual financial statements and MD&A for the year ended October 31, 2008. Northern Sun has applied for a revocation of the cease trade order issued by the Alberta Securities Commission concurrent with its application to the Commission.
8. Since the issuance of the Cease Trade Order, Northern Sun has filed, among other things, the following continuous disclosure documents with the Reporting Jurisdictions:
a. the comparative annual audited financial statements, MD&A and NI 52-109 certificates of Northern Sun for the year ended October 31, 2011;
b. the comparative interim unaudited financial statements, MD&A and certificates of Northern Sun for the quarters ended January 31, April 30, and July 31, 2012;
c. the comparative annual audited financial statements, MD&A and NI 52-109 certificates of Northern Sun for the year ended October 31, 2012; and
d. the comparative interim unaudited financial statements, MD&A and certificates of Northern Sun for the quarters ended January 31, and April 30, 2013.
9. Northern Sun has not filed:
a. comparative interim unaudited financial statements, corresponding MD&A, and NI 52-109 certificates for the periods ending: January 31, 2009, April 30, 2009, July 31, 2009, January 31, 2010, April 30, 2010, July 31, 2010, January 31, 2011, April 30, 2011, and July 31, 2011; and
b. comparative annual audited financial statements, corresponding MD&A, and NI 52-109 certificates for the periods ending October 31, 2008, October 31, 2009, and October 31, 2010.
(the "Outstanding Filings")
10. Northern Sun has paid all outstanding filing fees, participation fees and late filing fees required to be paid to the Ontario Securities Commission and has filed all forms associated with such payments.
11. Except for the failure to file the Outstanding Filings, Northern Sun (i) is up-to-date with all of its other continuous disclosure obligations; (ii) is not in default of any of its obligations under the Cease Trade Order; and (iii) is not in default of any requirements under the Act or the rules and regulations made pursuant thereto other than as set out in representation 12, below.
12. In July 2009 Northern Sun issued a convertible debenture (the "Debenture") to Trend Energy Services Ltd. (formerly 1474866 Alberta Ltd.) in the principal amount of $250,000 (the "Principal Sum") in contravention of the Cease Trade Order. The Debenture was subsequently assigned to Big Earl Resources Ltd. (the "Holder"). The Debenture further provided that the Holder could convert all or a portion of the Principal Sum (in increments of $50,000) into fully paid nonassessable common shares of Northern Sun at a conversion price of $0.05 per share. No amount owing under the Debenture has been converted to common shares of Northern Sun. Northern Sun and the Holder have cancelled the Debenture. Once the Cease Trade Order has been revoked, Northern Sun and the Holder will enter into a loan agreement for the outstanding Principal Sum plus interest.
13. Since the issuance of the Cease Trade Order, there have been no material changes in the business, operations or affairs of Northern Sun.
14. Since the issuance of the Cease Trade Order, no technical report has been required to be filed by Northern Sun pursuant to National Instrument 43-101Standards of Disclosure for Mineral Projects.
15. Northern Sun's current directors and executive officers are: Christopher R. Cooper, President, Chief Executive Officer and Director; Daryn Gordon, Chief Financial Officer; John Land, Director and Chief Operating Officer; and Les Stach, Director. Christopher R. Cooper, John Land, and Les Stach were elected at the last Annual General Meeting of the Company, held on April 25, 2008. Daryn Gordon was appointed as the Chief Financial Officer of the Company on September 30, 2012.
16. Northern Sun is not considering nor is it involved in any discussions related to, a reverse take-over, merger, amalgamation or other form of combination or transaction similar to any of the foregoing.
17. Northern Sun has given the executive director of its principal regulator, the British Columbia Securities Commission ("Executive Director"), a written undertaking that it will not complete any transaction that would result in a reverse take-over without providing advance written notice of such transaction to the Executive Director.
18. Northern Sun undertakes, in accordance with Section 3.1(5) of NP 12-202, to hold an annual meeting within three months of the date on which the Cease Trade Order is revoked.
19. Northern Sun has an up-to-date SEDAR profile and SEDI issuer profile supplement.
20. Upon the issuance of this revocation order, Northern Sun will issue a news release announcing the revocation. Northern Sun will concurrently file the news release and material change report on SEDAR.
AND UPON considering the application and the recommendation of the staff of the Commission;
AND UPON the Director being satisfied that it would not be prejudicial to the public interest to revoke the Cease Trade Order.
IT IS ORDERED pursuant to section 144 of the Act that the Cease Trade Order is revoked.
Dated: July 19, 2013