Section 144 -- Application by an issuer for a full revocation of a cease trade order issued by the Commission -- cease trade order issued because the issuer had failed to file certain continuous disclosure materials required by Ontario securities law -- defaults subsequently remedied by bringing continuous disclosure filings up-to-date -- cease trade order revoked.
Securities Act, R.S.O. 1990, c. S.5, as am., ss. 127, 144.
IN THE MATTER OF THE SECURITIES ACT, R.S.O. 1990, c. S.5, AS AMENDED (the "Act") AND IN THE MATTER OF TG RESIDENTIAL VALUE PROPERTIES LTD.
ORDER (Section 144)
WHEREAS the securities of TG Residential Value Properties Ltd. (the "Company") are subject to a temporary cease trade order dated November 13, 2013 issued by the Director of the Ontario Securities Commission (the "Commission") pursuant to paragraph 2 of subsection 127(1) and subsection 127(5) of the Act, as extended by a further cease trade order dated November 25, 2013 made by the Director, pursuant to paragraph 2 of subsection 127(1) of the Act (collectively, the "Ontario Cease Trade Order"), ordering that all trading in the securities of the Company, whether direct or indirect, cease until the Ontario Cease Trade Order is revoked by the Director;
AND WHEREAS the Ontario Cease Trade Order was made on the basis that the Company was in default of certain filing requirements under Ontario securities law as described in the Ontario Cease Trade Order;
AND WHEREAS the Company having applied to the Commission for an order pursuant to section 144 of the Act for a revocation of the Ontario Cease Trade Order;
AND UPON the Company having represented to the Commission that:
1. The Company was incorporated on February 8, 2011 pursuant to the Business Corporations Act (British Columbia) ("BCBCA") under the name TG Residential Value Properties Ltd.
2. The head office of the Company is located at Suite 527 -- 510 West Hastings Street, Vancouver, British Columbia, V6B 1L8. The Company's principal regulator is the British Columbia Securities Commission ("BCSC").
3. The Company is a reporting issuer or the equivalent under the securities legislation of the provinces of British Columbia, Alberta, Manitoba, Ontario and Newfoundland (the "Reporting Jurisdictions"). The Company is not a reporting issuer or the equivalent in any other jurisdiction in Canada.
4. The Company is authorized to issue an unlimited number of common shares without par value, of which 9,000,000 common shares are issued and outstanding as of the date hereof. Other than the common shares, the Company has no other securities, including debt securities, issued and outstanding.
5. The Company is a capital pool corporation ("CPC") and the Company's common shares were listed for trading on the TSX Venture Exchange ("TSX-V") by way of an initial public offering ("IPO") on November 29, 2011. In connection with the IPO, the Company granted 900,000 stock options to its directors and officers. Each stock option is exercisable into one common share in the capital of the Company at a price of $0.10 per share, for a period of 10 years.
6. The Company has not commenced commercial operations and has no significant assets other than cash. Except as specifically contemplated for CPC's in accordance with TSX-V Policy 2.4, until the completion of a qualifying transaction, the Company will not carry on any business other than the identification and evaluation of assets or businesses with a view to completing a qualifying transaction.
7. Prior to the issuance of the Ontario Cease Trade Order, on February 1, 2013, the Company announced that it had entered into a purchase and sale agreement to acquire a residential and commercial real estate property located in Winnipeg, Manitoba (the "Property") from Taurean Latitude 1 Multifamily LP (the "Vendor"). On March 30, 2013, the Vendor sold the Property to Penthouse on Princess Inc. ("Penthouse") and the Company subsequently entered into an agreement to purchase all the issued and outstanding common shares of Penthouse for a purchase price of $4,100,100 (the "Share Purchase"). The Company intends to finance a portion of the purchase price through a brokered private placement as previously announced by the Company on September 17, 2013.
8. Following the revocation of the Ontario Cease Trade Order, the Share Purchase, if completed, will constitute the Company's "qualifying transaction" under the policies of the TSX-V. The acquisition of Penthouse as the Company's "qualifying transaction" is subject to approval of the TSX-V which approval is evidenced by the publication of the TSX-V bulletin announcing such approval. The purchase of Penthouse is an arm's length transaction and, in accordance with the policies of the TSX-V, is not subject to shareholder approval.
9. The common shares of the Company are listed on the TSX-V under the symbol "TG.P" but are currently suspended from trading. The common shares are not listed or quoted on any other exchange or market in Canada or elsewhere.
10. On February 19, 2014 the Company held its annual general meeting in Vancouver. At that meeting (i) Karampaul Sandhu and Kerry Philpott were elected as directors and Douglas Thiessen was re-elected to the Company's board of directors and (ii) the shareholders voted for the Company to seek a listing on the NEX board of the TSX-V if the Company was unable to complete its "qualifying transaction" in a timely manner.
11. The Ontario Cease Trade Order was issued as a result of the Company's failure to file its audited annual financial statements for the fiscal year ended June 30, 2013 as well as the corresponding management's discussion and analysis and applicable executive officers' certificates required under National Instrument 52-109 Certification of Disclosure in Issuers' Annual and Interim Filings for the fiscal year ended June 30, 2013 (collectively, the "Annual Filings").
12. The Company was also subject to similar cease trade orders issued by the BCSC on November 7, 2013 (the "British Columbia Cease Trade Order") and the Manitoba Securities Commission on November 15, 2013 (the "Manitoba Cease Trade Order") as a result of the failure to file the Annual Filings within the time prescribed by the applicable securities legislation. A formal application for the revocation of the British Columbia Cease Trade Order is not required, as the filing of the Annual Filings constitutes such application (which was completed on December 6, 2013). The British Columbia Cease Trade Order was revoked on December 12, 2013 and the Manitoba Cease Trade Order was subsequently revoked on December 18, 2013 and no cease trade order exists in respect of the Company's securities in any jurisdiction other than Ontario.
13. Since the issuance of the Ontario Cease Trade Order, the Company has filed the Annual Filings with the Reporting Jurisdictions on December 6, 2013.
14. As of the date hereof, the Company is up-to-date in its continuous disclosure filings with the Reporting Jurisdictions and has paid all outstanding activity, participation and late filing fees that are required to be paid.
15. The Company is not in default of any requirements under applicable securities legislation or the rules and regulations made pursuant thereto in any of the Reporting Jurisdictions, except for the existence of the Ontario Cease Trade Order.
16. Since the issuance of the Ontario Cease Trade Order, there have been no material changes in the business, operations or affairs of the Company.
17. The Company's SEDAR profile and SEDI issuer profile supplement are current and accurate.
18. Upon the revocation of the Ontario Cease Trade Order, the Company will issue a news release and concurrently file a material change report on SEDAR announcing the revocation of the Ontario Cease Trade Order and outlining the Company's future plans.
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 Ontario Cease Trade Order;
IT IS ORDERED, pursuant to section 144 of the Act, that the Ontario Cease Trade Order be and is hereby revoked.
DATED this 31st day of March, 2014.