National Policy 11-206 Process for Cease to be a Reporting Issuer Applications – issuer deemed to be no longer a reporting issuer under securities legislation.
Applicable Legislative Provisions
Securities Act, R.S.O. 1990, c. S.5, as am., s. 1(10)(a)(ii).
August 23, 2017
IN THE MATTER OF
THE SECURITIES LEGISLATION OF
QUÉBEC AND ONTARIO
IN THE MATTER OF
THE PROCESS FOR CEASE TO BE
A REPORTING ISSUER APPLICATIONS
IN THE MATTER OF
LUMENPULSE GROUP INC.
The securities regulatory authority or regulator in each of the Jurisdictions (“Decision Maker”) has received an application from the Filer for an order under the securities legislation of the Jurisdictions (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 Applications (for a dual application):
(a) the Autorité des marches financiers (Québec) is the principal regulator for this application,
(b) the Filer has provided notice that subsection 4C.5(1) of Regulation 11-102 Passport System (“Regulation 11-102”) is intended to be relied upon in each of British Columbia, Alberta, Saskatchewan, Manitoba, New Brunswick, Nova Scotia, Prince Edward Island, Newfoundland, Yukon, Northwest Territories and Nunavut, and
(c) this order is the order of the principal regulator and evidences the decision of the securities regulatory authority or regulator in Ontario.
Terms defined in Regulation 14-101 respecting Definitions, Regulation 11-102 and, in Québec, in Regulation 14-501Q on definitions have the same meaning if used in this order, unless otherwise defined.
This order is based on the following facts represented by the Filer:
1. The Filer is a corporation existing under the Canada Business Corporations Act (the “CBCA”). Its head office is located at 1220 Marie-Victorin Blvd., Longueuil (Québec) J4G 2H9.
2. On April 26, 2017, Lumenpulse Inc. (“Lumen-pulse”) and 10191051 Canada Inc. (the “Pur-chaser”) entered into an arrangement agreement providing for, among other things, the acquisition by the Purchaser of all of the issued and outstanding common shares of Lumenpulse (the “Lumenpulse Shares”) by way of a plan of arrangement under the CBCA, which was completed on June 21, 2017 (the “Arrangement”).
3. At the time of the Arrangement, Lumenpulse was a reporting issuer in all of the provinces and territories of Canada.
4. The Arrangement was approved by the shareholders of Lumenpulse at a special meeting of the shareholders held on June 16, 2017 and by the Superior Court of Québec on June 20, 2017.
5. The Lumenpulse Shares were delisted from the TSX as at close of markets on June 22, 2017.
6. Immediately following the completion of the Arrangement, Lumenpulse and the Purchaser effected a vertical short-form amalgamation on June 21, 2017 (the “Amalgamation”), with the Purchaser and Lumenpulse continuing as one corporation under the name “Lumenpulse Group Inc.”, being the Filer.
7. In connection with the Arrangement and as a result of the Amalgamation, the Filer became a reporting issuer in all of the provinces and territories of Canada.
8. The full details of the Arrangement and the intention of Lumenpulse to make an application to cease to be a reporting issuer were contained in a management proxy circular of Lumenpulse dated May 11, 2017, a copy of which is available under the Filer's profile at www.sedar.com.
9. Pursuant to the Arrangement:
a) a group of shareholders of Lumenpulse, including, without limitation, François-Xavier Souvay, the Founder, President and Chief Executive Officer of Lumen-pulse, Nicolas Bélanger, Michel Ringuet, Yvan Hamel, Tim Berman, Lance Howitt and Dario Nistri and certain entities related to them (collectively, the “Rollover Shareholders”), who collec-tively owned or exercised control or direction over approximately 38% of the issued and outstanding Lumenpulse Shares, transferred their Lumenpulse Shares to the Purchaser in exchange for common shares of the Purchaser (the “Purchaser Shares”);
b) each shareholder of Lumenpulse, other than the Rollover Shareholders, received from the Purchaser $21.25 in cash per Lumenpulse Share;
c) each holder of vested options to purchase Lumenpulse Shares (the “Options”) elected, at his or her option, either (i) to receive a cash payment for each vested Option in an amount equal to $21.25 less the applicable exercise price and applicable withholding in respect of such Option; or (ii) to continue to hold each vested Option in accordance with the terms and conditions of the stock option plan and any applicable option agreement, in each case as amended and restated in connection with the Arrangement to take into account the privatization of Lumenpulse (collectively, the “Amended Option Documents”);
d) each holder of unvested Options continued to hold each unvested Option in accordance with the provisions of the Amended Option Documents; and
e) each holder of restricted stock units, performance share units and deferred stock units of Lumenpulse, whether vested or unvested, received a cash payment for each unit equal to the amount of $21.25, less applicable withholding.
10. The authorized capital of the Filer consists of an unlimited number of common shares (the “Filer Shares”). As at the date hereof, there are 22,568,550 Filer Shares issued and outstanding.
11. The Filer Shares are held by 32 shareholders residing in the following jurisdictions:
a) 17 in Québec;
b) 5 in British Columbia;
c) 1 in Saskatchewan; and
d) 9 outside Canada.
12. As at the date hereof, there are 1,055,286 options to purchase Filer Shares (the “Filer Options”) issued and outstanding. The Filer Options are governed by the Amended Option Documents, the main provisions of which have all been communicated to the holders of Filer Options prior to the completion of the Arrangement, including, as applicable, prior to their making of the election described under paragraph 9c) above.
13. Each such holder of Filer Options is an employee of the Filer or of a subsidiary of the Filer.
14. The Filer Options were issued under a prospectus exemption pursuant to section 2.4 or 2.24 of Regulation 45-106 respecting Prospectus Exemp-tions, as the case may be.
15. The Filer Options are held by 70 persons residing in the following jurisdictions:
a) 38 in Québec;
b) 4 in British Columbia; and
d) 28 outside Canada.
16. As at the date hereof, the Filer has no securities issued and outstanding other than the Filer Shares and the Filer Options.
17. The Filer is not an OTC reporting issuer under Regulation 51-105 respecting Issuers Quoted in the U.S. Over-the-Counter Markets.
18. No securities of the Filer, including debt securities, are traded in Canada or another country on a marketplace as defined in Regulation 21-101 respecting Marketplace Operation or any other facility for bringing together buyers and sellers of securities where trading data is publicly reported.
19. The Filer is not in default of its obligations as a reporting issuer pursuant to the Legislation, except for its audited annual financial statements, its annual MD&A, its annual information form and its annual certifications for the fiscal year ended April 30, 2017, being documents required pursuant to sections 4.1, 4.2, 5.1, 6.1 and 6.2 of Regulation 51-102 respecting Continuous Disclosure Obligations and pursuant to section 4.1 of Regulation 52-109 respecting Certification of Disclosure in Issuers’ Annual and Interim Filings.
20. At the time of granting of the Order Sought, the Filer will no longer be a reporting issuer or the equivalent in any jurisdiction of Canada.
21. The Filer does not actually intend to proceed with a distribution of its securities in any jurisdiction of Canada, other than in reliance on an exemption from the prospectus requirements under applicable Legislation.
Each of the Decision Makers is satisfied that the order meets the test set out in the Legislation for the Decision Maker to make the order.
The decision of the Decision Makers under the Legislation is that the Order Sought is granted.
Director, Continuous Disclosure
Autorité des marchés financiers