Headnote
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions - Confidentiality - application by an issuer for a decision that certain portions of a material contract previously filed and made public on SEDAR be held in confidence for an indefinite period by the Commission, to the extent permitted by law - contract contains intimate financial, personal and other sensitive information, the disclosure of which would be seriously prejudicial to the interests of the issuer and other persons affected - issuer subsequently filed and made public on SEDAR a redacted version of the contract in which the intimate financial, personal and other sensitive information has been omitted or marked to be unreadable - information redacted from the redacted version of the contract does not contain information that would be material to an investor - relief granted.
Applicable Ontario Legislative Provisions
Securities Act, R.S.O. 1990, c. S.5, as am., ss. 140(1) and 140(2).
Applicable Instruments
National Instrument 51-102 Continuous Disclosure Obligations, part 12.
June 10, 2008
IN THE MATTER OF
THE SECURITIES LEGISLATION OF
ontario (the "Jurisdiction")
AND
IN THE MATTER OF
THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS
IN MULTIPLE JURISDICTIONS
AND
IN THE MATTER OF
FIRSTSERVICE CORPORATION
(the "Filer")
Decision
Background
The principal regulator in the Jurisdiction has received an application from the Filer for a decision under the securities legislation of the Jurisdiction of the principal regulator (the "Legislation") that, pursuant to the confidentiality provisions of the Legislation, a certain share purchase agreement (including the schedules appended thereto, the "Purchase Agreement") dated April 14, 2008 between the Filer and ADT Security Services Canada, Inc., filed by the Filer on April 22, 2008 (the "Original Filed Agreement") on the System for Electronic Document Analysis and Retrieval ("SEDAR") be held in confidence (and therefore not available to the public for inspection) for an indefinite period, to the extent permitted by law (the "Exemption Sought").
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission (the "Commission") is the principal regulator for this application; and
(b) the Filer has provided notice that Section 4.7(1) of Multilateral Instrument 11-102 Passport System ("MI 11-102") is intended to be relied upon in each of the following jurisdictions: British Columbia, Alberta, Saskatchewan, Manitoba, Quebec, New Brunswick, Nova Scotia, Prince Edward Island and Newfoundland and Labrador (the "Non-Principal Passport Jurisdictions").
Interpretation
Terms defined in National Instrument 14-101 Definitions and MI 11-102 have the same meaning if used in this decision, unless otherwise defined.
Representations
This decision is based on the following facts represented by the Filer:
The Filer is a corporation amalgamated under the Business Corporations Act (Ontario).
The Filer's head office is located in Toronto, Ontario.
The Filer is a reporting issuer (or the equivalent) in each of the provinces of Canada and is not in default of any requirement under the Legislation or the securities legislation of the Non-Principal Passport Jurisdictions. The Filer is also a foreign private issuer under applicable United States securities legislation.
The Subordinate Voting Shares of the Filer are listed and posted for trading in Canada on the Toronto Stock Exchange under the symbol "FSV" and in the United States on the Nasdaq Stock Market under the symbol "FSRV". The 7% Cumulative Preference Shares, Series 1 of the Filer are also listed for trading on the Toronto Stock Exchange under the symbol "FSV.PR.U".
On April 14, 2008, the Filer entered into the Purchase Agreement and disclosed the entering into of the Purchase Agreement via a press release issued and filed on SEDAR that day. A material change report was also filed by the Filer on SEDAR on April 14, 2008 in respect of the entering into of the Purchase Agreement. The Purchase Agreement provides for the sale of the Filer's integrated security division, operated through a wholly-owned subsidiary of the Filer ("Subco"), to ADT Security Services Canada, Inc.
On April 22, 2008, the Filer filed on SEDAR the Original Filed Agreement pursuant to section 12.2 of National Instrument 51-102 Continuous Disclosure Obligations ("NI 51-102") within the time-frame provided for by Part 12 of NI 51-102.
Thereafter, it came to the Filer's attention that the disclosure schedules appended to the Original Filed Agreement contain certain confidential information (the "Confidential Information") that is intimate financial and personal information relating to certain employees and customers of the Filer (the "Affected Persons") and otherwise contain commercially sensitive operational and financial information concerning the Filer.
The Filer believes that continued public access to the Confidential Information would seriously prejudice the interests of the Affected Persons and the Filer for the following reasons:
(i) the disclosure of the names and intimate details of employees, customers, landlords and suppliers of the Filer and Subco would violate confidentiality/non-disclosure obligations of the Filer and Subco to such persons and otherwise may violate applicable Canadian privacy legislation;
(ii) the disclosure of details regarding litigation involving Subco (or direct and indirect subsidiaries of Subco) would allow other parties to such litigation to obtain a tactical advantage or otherwise alter the conduct, length or result of such litigation;
(iii) maintaining the confidentiality of financial information, pricing information, proposed business plans, proposed capital expenditures and certain intellectual property information of the Filer and Subco is important with respect to the relations of the Filer and Subco and the ability of the Filer and Subco to negotiate contracts with potential customers, landlords and suppliers;
(iv) bank account locations and numbers, historical insurance claims and amounts, health and group benefit plans and similar information is sensitive and intimate information in relation to the Filer and Subco and the parties providing or involved in such products or services; and
in general, none of the Confidential Information, either individually or in aggregate, is necessary for understanding the impact of the Purchase Agreement on the business of the Filer.
The Filer further believes that: (i) the desirability of avoiding disclosure of the Confidential Information in the interests of the Affected Persons and the Filer outweighs the desirability of adhering to the principle that material filed with the Commission be available to the public for inspection; and (ii) the disclosure of the Confidential Information is not necessary in the public interest.
The Filer is permitted to file a redacted version of the Purchase Agreement pursuant to section 12.2 of NI 51-102.
Accordingly, on May 16, 2008, the Filer re-filed a copy of the Purchase Agreement (including the schedules appended thereto) on SEDAR with the Confidential Information omitted or marked so as to be unreadable (the "Redacted Filed Agreement").
The portions omitted or marked so as to be unreadable from the Purchase Agreement (to form the Redacted Filed Agreement) do not contain information in relation to the Filer or the securities of the Filer that would be material to an investor for purposes of making an investment decision.
As a result of the Original Filed Agreement being filed and made public on SEDAR, the Original Filed Agreement has also been disseminated to subscribers of the SEDAR-SCRIBE service. The Filer has requested that CDS Inc., the administrator of the SEDAR-SCRIBE service, send instructions to subscribers of the SEDAR-SCRIBE service to delete the Original Filed Agreement from their own files. The Filer has been advised by representatives of CDS Inc. that subscribers of the SEDAR-SCRIBE service are contractually bound to follow these instructions.
The Filer acknowledges that marking the Original Filed Agreement private on SEDAR does not guarantee that the Original Filed Agreement is not available elsewhere in the public domain.
Decision
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator under the Legislation is that the Exemption Sought is granted.
“David L. Knight”_____________ “Mary Condon”_________________
Commissioner Commissioner