Headnote National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions – application from subsidiary (Subco) of parent company (Parent) for a decision under section 13.1 of National Instrument 51-102 Continuous Disclosure Obligations (NI 51-102) exempting Subco from the requirements of NI 51-102; for a decision under section 8.6 of National Instrument 52-109Certification of Disclosure in Issuers’ Annual and Interim Filings (NI 52-109) exempting Subco from the requirements of NI 52-109; for a decision under section 121(2)(a)(ii) of the Securities Act (Ontario) exempting the insiders of Subco from the insider reporting requirements of the Act; and for a decision under section 6.1 of National Instrument 55-102 System for Electronic Disclosure by Insiders exempting the insiders of Subco from the requirement to file an insider profile – Subco is a wholly-owned subsidiary of Parent – Subco is a reporting issuer and has warrants outstanding – Warrants entitle holder to acquire common shares of Parent – Warrants do not qualify as “designated exchangeable securities” under exemption in section 13.3 of NI 51-102 – relief granted on conditions substantially similar to the conditions contained in section 13.3 of NI 51-102.
Applicable Legislative Provisions
Securities Act, R.S.O. 1990, c.S.5, as am., ss. 107 and 121(2)(a)(ii) National Instrument 51-102 Continuous Disclosure Obligations, ss. 13.1 and 13.3 National Instrument 52-109 Certification of Disclosure in Issuers’ Annual and Interim Filings s. 8.6 National Instrument 55-102 System for Electronic Disclosure by Insiders, s. 6.1
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 U.S. Silver Corporation (“U.S. Silver”) and U.S. Silver & Gold Inc. (“U.S. Silver & Gold”) (collectively, the “Filers”).
Decision
Background
- The securities regulatory authority in the Jurisdiction (the “Decision Maker”) has received an application from the Filers for a decision under the securities legislation of the Jurisdiction (the “Legislation”) that:
(b) the requirements of National Instrument 51-102 - Continuous Disclosure Obligations (“NI 51-102”) (the “Continuous Disclosure Requirements”) do not apply to U.S. Silver;
(c) the requirements of National Instrument 52-109 - Certification of Disclosure in Issuers' Annual and Interim Filings (“NI 52-109”) (the “Certification Requirements”) do not apply to U.S. Silver; and
(d) the insider reporting requirements under Part XXI of the Legislation and the requirement to file an insider profile under National Instrument 55-102 - System for Electronic Disclosure by Insiders (together, the “Insider Reporting Requirements”) do not apply to any insider of U.S. Silver.
(Collectively, the “Exemption Sought”)
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions:
(i) the Decision Maker is the principal regulator for this application; and
(ii) 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 British Columbia and Alberta.
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 Filers:
(a) U.S. Silver is a corporation existing under the Canada Business Corporations Act (the “CBCA”).
(b) RX Gold & Silver Inc. (“RX Gold”) is a corporation existing under the Business Corporations Act (Ontario) (the “OBCA”).
(c) On August 13, 2012 (the “Effective Date”), U.S. Silver and RX Gold became wholly-owned subsidiaries of U.S. Silver & Gold Inc. (“U.S. Silver & Gold”) as a result of a combination transaction pursuant to a combination agreement dated June 7, 2012, as amended on June 28, 2012 (as amended, the “Combination Agreement”), whereby:
(i) each outstanding U.S. Silver common share (collectively, the “U.S. Silver Shares”) was exchanged for 0.67 of a common share of U.S. Silver & Gold (each whole share, a “U.S. Silver & Gold Share”) pursuant to a plan of arrangement under the CBCA (the “U.S. Silver Arrangement”); and
(ii) each outstanding RX Gold common share (collectively, the “RX Gold Shares”) was exchanged for 0.109 of a U.S. Silver & Gold Share pursuant to a plan of arrangement under the OBCA (together with the U.S. Silver Arrangement, the “Combination Transaction”).
(d) U.S. Silver
(i) U.S. Silver was incorporated on March 23, 200