Headnote
Multilateral Instrument 11-102 Passport System and National Policy 11-203 Process for Exemptive Relief applications in Multiple Jurisdictions – National Instrument 51-102 Continuous Disclosure Obligations,s.13.1 – Application by issuer for relief from requirement to include certain financial statements in a management information circular and a business acquisition report (BAR) –– Relief subject to condition that management information circular and the BAR include the prescribed financial statements of the operating subsidiary entity and pro forma financial statements of the issuer giving effect to the acquisition excluding the holding entities. Applicable Legislative Provisions
National Instrument 51-102 Continuous Disclosure Obligations, ss. 8.4.
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 ENERGY FUELS INC. (the “Filer”)
DECISION
Background
The principal regulator in the Jurisdiction has received an application from the Filer for a decision (the “Requested Relief”) under the securities legislation of the Jurisdiction of the principal regulator (the “Legislation”) exempting the Filer from the requirement in Section 8.4 of National Instrument 51-102 – Continuous Disclosure Obligations (“NI 51-102”) of the Filer to include interim financial statements of White Canyon Uranium Limited (“White Canyon”) for the nine-month interim periods ended March 31, 2012 and 2011 (the “White Canyon Interim Statements”) in the Filer’s management information circular (the “EFI Circular”) with respect to a special meeting (the “Meeting”) of shareholders to approve an issuance of securities in connection with a transaction between the Filer and Denison Mines Corp. (“Denison”) and in the Filer’s business acquisition report in respect of such transaction (the “EFI BAR”).
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
the Ontario Securities Commission is the principal regulator for this application; and
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 British Columbia, Alberta, Saskatchewan and Manitoba, except Ontario.
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 and Other Parties to the Proposed Transaction
The Filer’s head office is located at 2 Toronto Street, Suite 500, Toronto, Ontario M5C 2B6.
The Filer is a corporation existing under the Business Corporations Act (Ontario) (the “OBCA”).
The Filer is a reporting issuer in British Columbia, Alberta, Saskatchewan, Manitoba and Ontario. The common shares of the Filer are listed and posted for trading on the Toronto Stock Exchange (“TSX”) under the symbol “EFR”.
The Filer’s financial year end is September 30 of each year.
Denison is a corporation existing under the OBCA.
Denison is a reporting issuer in each of the provinces of Canada and is not currently in default of the securities legislation in any of these jurisdictions as of the date hereof. The common shares of Denison are listed and posted for trading on the TSX under the symbol “DML” and on the NYSE MKT LLC under the symbol “DNN”.
Denison holds all of the outstanding shares of White Canyon. Denison and White Canyon together hold all of the outstanding shares of Denison Mines Holdings Corp. (“DMHC”).
DMHC is a Delaware corporation with a December 31 financial year end. DMHC is a holding company that holds shares and interests of the various entities which comprise Denison’s U.S. mining business. Prior to September 1, 2011, Denison held all the shares of DMHC directly.
White Canyon is a corporation organized under the laws of Australia with a June 30 financial year end. White Canyon was previously listed on the Australian Stock Exchange (“ASX”) and was a reporting issuer in Alberta and British Columbia with a secondary listing on the TSX Venture Exchange (the “TSXV”).
Denison acquired approximately 96% of outstanding shares of White Canyon effective July 1, 2011 in a take-over transaction under Corporations Act 2001 (Australia) that was exempt from the formal bid requirements of Part XX of the Securities Act (Ontario) (the “Act”) pursuant to section 100.3 of the Act. Denison acquired the remaining shares of White Canyon on July 28, 2011 under the compulsory acquisition provisions of Australian corporate law.
Denison’s acquisition of White Canyon was not a significant acquisition for Denison for the purposes of Part 8 of NI 51-102.
On September 1, 2011, White Canyon transferred the shares of Utah Energy Corporation (“UEC”) to DMHC. In exchange, DMHC issued 4.7 shares of common stock to White Canyon, representing approximately 29.9% of DMHC’s common stock. The remainder of the common shares of DMHC, as well as preferred shares, are held by Denison directly.
The shares of UEC represented the only material asset of White Canyon. Since September 1, 2011 the only material asset of White Canyon has been its minority shareholding interest in DMHC. White Canyon has no other material assets or liabilities other than some inter-company debt to Denison.
Accordingly:
(a) since July 1, 2011, DMHC and White Canyon have been under common control; and
(b) since September 1, 2011, the financial results of the operating business previously owned by White Canyon, being UEC, are included in the financial results of DMHC.
- Prior to the acquisition by Denison of White Canyon, White Canyon was a “designated foreign issuer” as defined in National Instrument 52-107 – Acceptable Accounting Principles and Auditing Standards. Upon the completion of Denison’s acquisition of White Canyon, White Canyon terminated its listings on the ASX and the TSXV, and ceased to be a reporting issuer in any Canadian province.
The Proposed Transaction
On April 16, 2012, the Filer and Denison entered into a letter agreement (the “Letter Agreement”) to complete a transaction whereby the Filer will acquire from Denison all of the outstanding shares of DMHC held by Denison and all of the outstanding shares of White Canyon.
As consideration for the shares of DMHC and White Canyon, the Filer will issue 425,441,494 common shares (the “EFR Share Consideration”). The transaction will be carried out by Denison in connection with a corporate reorganization under a plan of arrangement pursuant to the [OBCA](https://www.canlii.org/en/on/laws/stat/rso-199