Securities Law & Instruments


Headnote

National Policy 11-207 Failure-to-File Cease Trade Orders and Revocations in Multiple Jurisdictions – Application for partial revocation of a failure-to-file cease trade order issued by the Commission and Alberta Securities Commission – variation of cease trade order to permit the Issuer to distribute convertible debentures pursuant to certain exemptions from the prospectus requirement – Commission opt-in to partial revocation order issued by Alberta Securities Commission, as principal regulator.

Applicable Legislative Provisions

Securities Act, R.S.O. 1990, c. S.5, as am., ss. 127, 144.
National Policy 11-207 Failure-to-File Cease Trade Orders and Revocations in Multiple Jurisdictions.

ALBERTA SECURITIES COMMISSION

PARTIAL REVOCATION ORDER
Under the Securities Legislation of Alberta and Ontario
(the Legislation)

Citation: Re Robix Environmental Technologies, Inc., 2019 ABASC 119

July 26, 2019

Robix Environmental Technologies, Inc.

Background

1.             Robix Environmental Technologies, Inc. (the Issuer) is subject to a failure-to-file cease trade order (the FFCTO) issued by the regulator or securities regulatory authority in each of Alberta (the Principal Regulator) and Ontario (each a Decision Maker) respectively on 4 May 2018.

2.             The Issuer has applied to each of the Decision Makers for a partial revocation order of the FFCTO.

3.             This order is the order of the Principal Regulator and evidences the decision of the Decision Maker in Ontario.

Interpretation

Terms defined in National Instrument 14-101 Definitions or in National Policy 11-207 Failure-to-File Cease Trade Orders and Revocations in Multiple Jurisdictions have the same meaning if used in this order, unless otherwise defined.

Representations

4.             This order is based on the following facts represented by the Issuer:

(a)           The Issuer was incorporated under the laws of Alberta on 9 June 2011.

(b)           The Issuer’s head office is located in Calgary, Alberta.

(c)           The Issuer is a reporting issuer in Alberta, British Columbia, and Ontario. The Issuer is not a reporting issuer in any other jurisdiction. The FFCTO is reciprocated in British Columbia pursuant to section 2 of Multilateral Instrument 11-103 Failure-to-File Cease Trade Orders in Multiple Jurisdictions.

(d)           The Issuer has an authorized share capital of an unlimited number of common shares and an unlimited number of preference shares, of which 62,409,708 common shares and no preference shares are issued and outstanding.

(e)           The FFCTO was issued in response to the Issuer's failure to file its annual audited financial statements, annual management's discussion and analysis and certification of annual filings for the year ended 31 December 2017 (the Unfiled Continuous Disclosure).

(f)            Other than the failure to file the Unfiled Continuous Disclosure the Issuer is not in default of the securities legislation in any jurisdiction.

(g)           The Issuer seeks to vary the FFCTO to permit the Issuer to distribute, pursuant to certain exemptions from the prospectus requirement, convertible debentures for aggregate maximum proceeds of $317,500 (the Offering). Each debenture will be convertible at a price of $0.05 per unit into units consisting of one (1) common share and one (1) warrant (each such warrant entitling the holder thereof to purchase one (1) common share at a price of $0.075 per share for a period of 36 months).

(h)           For each distribution made in respect of the Offering, the Issuer will comply with one or more of the accredited investor exemption contained in section 2.3 of National Instrument 45-106 Prospectus Exemptions (NI 45-106), the family, friends and business associates exemption in section 2.5 of NI 45-106 and the employee, executive officer, director and consultant exemption in section 2.24 of NI 45-106. The Issuer will only use the exemption in section 2.24 of NI 45-106 to raise funds from executive officers and directors, and the Issuer will not use this exemption to raise funds from employees or consultants.

(i)            The Offering is intended to take place in Alberta, British Columbia, and Ontario.

(j)            The Issuer reasonably expects the proceeds from the Offering will be used in a manner consistent with the below table:

Accounting and Auditor Fees

$50,000

Transfer Agent Fees

$25,000

Regulatory and Stock Exchange Fees

$67,500

Legal Fees for Disclosure Documents, Applications and Financing

$25,000

Settlement of Outstanding Accounts Payable

$70,000

Insurance Fees

$20,000

Office Rent

$20,000

Other

$40,000

Total

$317,500


(k)           The Issuer reasonably expects that the proceeds raised from the Offering will be sufficient to bring its continuous disclosure up to date and to apply for a full revocation of the FFCTO and pay all related outstanding related fees.

(l)            Within a reasonable time following the completion of the Offering, the Issuer intends to file the unfiled continuous disclosure and pay all outstanding fees. The Issuer also intends to apply for a full revocation of the FFCTO.

(m)          The Issuer hereby undertakes to provide the signed and dated written acknowledgments referred to in paragraph 6(c) below to staff of the Alberta Securities Commission on request.

Order

5.             Each of the Decision Makers is satisfied that a partial revocation order of the FFCTO meets the test set out in the Legislation for the Decision Maker to make the decision.

6.             The decision of the Decision Makers under the Legislation is that the FFCTO is partially revoked as it applies to the Issuer solely to permit the Offering, provided that prior to completion of the Offering, each investor will receive:

(a)           a copy of the FFCTO;

(b)           a copy of this Partial Revocation Order; and

(c)           written notice from the Issuer, to be acknowledged by each investor in writing, that all of the Issuer’s securities, including the securities issued in connection with the Offering, will remain subject to the FFCTO until such orders are revoked and that the issuance of the partial revocation order does not guarantee the issuance of a full revocation in the future.

26 July 2019

“Timothy Robson”
Manager, Legal
Corporate Finance
Alberta Securities Commission