National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- application for a decision that the issuer is not a reporting issuer under applicable securities laws -- issuer in default of its obligation to file and deliver its quarterly financial statements and related management's discussion and analysis and certain MI 61-101 deficiencies -- requested relief granted.
Applicable Legislative Provisions
Securities Act, R.S.O. 1990, c. S.5, as am., s. 1(10)(a)(ii).
National Policy 11-206 Process for Cease to be a Reporting Issuer Applications.
February 21, 2017
IN THE MATTER OF THE SECURITIES LEGISLATION OF ONTARIO (THE JURISDICTION) AND IN THE MATTER OF THE PROCESS FOR CEASE TO BE A REPORTING ISSUER APPLICATIONS AND IN THE MATTER OF MITEC TECHNOLOGIES INC. (THE FILER)
The principal regulator in the Jurisdiction has received an application from the Filer for an order under the securities legislation of the Jurisdiction (the Legislation) that the Filer has ceased to be a reporting issuer in all jurisdictions of Canada in which it is a reporting issuer (the Order Sought).
Under the Process for Cease to be a Reporting Issuer Application (for a passport application):
(a) the Ontario Securities Commission is the principal regulator for this application, and
(b) the Filer has provided notice that subsection 4C.5(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in British Columbia, Alberta, Saskatchewan, Manitoba, Quebec, New Brunswick, Nova Scotia, Prince Edward Island and Newfoundland.
Terms defined in National Instrument 14-101 Definitions and MI 11-102 have the same meaning if used in this decision, unless otherwise defined.
This order is based on the following facts represented by the Filer:
1. The Filer is a corporation governed by the Ontario Business Corporations Act with its head office located at 2333 North Sheridan Way, Suite 200, Mississauga, Ontario.
2. The Filer is a reporting issuer in British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, Quebec, New Brunswick, Nova Scotia, Prince Edward Island and Newfoundland. The Filer is not a reporting issuer in any other jurisdiction in Canada.
3. The Filer is applying for a decision that it is not a reporting issuer in all of the jurisdictions of Canada in which it is currently a reporting issuer.
4. At the special and annual shareholders meeting of the Filer held on June 6, 2016 (the Meeting), the shareholders of the Filer approved a resolution providing for the consolidation (the Consolidation) of the Filer's common shares (Common Shares) on the basis of one new Common Share (each a Post-Consolidation Share) for every five million two hundred thousand (5,200,000) Common Shares outstanding prior to the Consolidation (each a Pre-Consolidation Share). The Consolidation provided that no fractional Post-Consolidation Shares would be issued and each shareholder holding less than 5,200,000 Pre-Consolidation Shares would be paid $0.02 per Pre-Consolidation Share (the Consideration).
5. The Consideration is equal to the Filer's cash on hand after liquidating its assets, paying its regulatory, legal and accounting costs, costs associated with the Meeting and other payables of the Filer.
6. The Consolidation was approved by 73.60% of the votes cast at the Meeting. Following the completion of the Consolidation on September 29, 2016, the sole remaining shareholder of the Filer is a related party of the Filer (the Related Party) within the meaning of Multilateral Instrument 61-101 -- Protection of Minority Security Holders in Special Transactions (MI 61-101).
7. The Consolidation was subject to Part 4 and Part 8 of MI 61-101 (the Business Combination Requirements). The Filer's management information circular in respect of the Meeting did not disclose that the Consolidation was subject to the Business Combination Requirements or fully comply with the Business Combination Requirements (the MI 61-101 Deficiencies).
8. The Related Party did not vote on the Consolidation and did not receive any Consideration pursuant to the Consolidation.
9. The Common Shares of the Filer were delisted from the TSX Venture Exchange effective at the close of business on September 29, 2016. No securities of the Filer are traded on, or listed or quoted on, any exchange or market.
10. The Filer is not an OTC reporting issuer under Multilateral Instrument 51-105 Issuers Quoted in the U.S. Over-the-Counter Markets.
11. No securities of the Filer, including debt securities, are traded in Canada or another country on a marketplace (as defined in National Instrument 21-101 Marketplace Operation) or any other facility for bringing together buyers and sellers of securities where trading data is publicly reported.
12. As a result of the Consolidation, the outstanding securities of the Filer, including debt securities, are beneficially owned, directly or indirectly, by fewer than 15 securityholders in each of the jurisdictions of Canada and fewer than 51 securityholders in total worldwide.
13. The Filer has no current intention to seek public financing by way of an offering of securities.
14. The Filer is not in default of securities legislation in any jurisdiction except for (i) the failure to file, by the prescribed deadline, interim financial statements for the three and nine month period ended September 30, 2016 and management's discussion & analysis relating to the interim financial statements for the three and nine month period ended September 30, 2016 and certification of the foregoing filings under National Instrument 52-109 Certification of Disclosure in Issuers' Annual and Interim Filings (the Filings); and (ii) the MI 61-101 Deficiencies.
15. The Filer has no contractual commitments that require it to maintain reporting issuer status.
16. The Filer is not eligible to use the simplified procedure under National Policy 11-206 Process for Cease to be a Reporting Issuer Application as it is in default for (i) the failure to file the Filings; and (ii) the MI 61-101 Deficiencies in relation to the Consolidation.
17. Upon granting of the Order Sought, the Filer will not be a reporting issuer or the equivalent in any jurisdiction in Canada.
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the order.
The decision of the principal regulator under the Legislation is that the Order Sought is granted.