Ontario Securities Commission Bulletin
Issue 44/27 - July 08, 2021
Ont. Sec. Bull. Issue 44/27
• Troy Richard James Hogg et al.
• Trans-Canada Capital Inc. and TCC Alphabet Master Fund, LP
• Waypoint Investment Partners Inc.
• BMO Private Investment Counsel Inc. and BMO Private Canadian Short-Term Bond Portfolio
• Temporary, Permanent & Rescinding Issuer Cease Trading Orders
• Temporary, Permanent & Rescinding Management Cease Trading Orders
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Notice of Co-Operation Agreement Concerning Innovative Fintech Businesses with the Hong Kong Securities and Futures Commission
July 8, 2021
The Ontario Securities Commission, together with the Québec Autorité des marchés financiers, British Columbia Securities Commission, the Alberta Securities Commission, the Financial and Consumer Affairs Authority of Saskatchewan, the Manitoba Securities Commission, the Financial and Consumer Services Commission (New Brunswick) and the Nova Scotia Securities Commission, have recently entered into a Co-operation Agreement ("the Agreement") with the Hong Kong Securities and Futures Commission ("SFC") concerning co-operation and information sharing between authorities regarding their respective innovation functions. The Agreement provides a comprehensive framework for co-operation and referrals related to the innovation functions which were established through the CSA Regulatory Sandbox initiative and by the SFC.
The Agreement is subject to the approval of the Minister of Finance. The Agreement was delivered to the Minister of Finance on July 5, 2021.
Questions may be referred to:
Stephanie TjonManager, OSC LaunchPadOffice of Economic Growth & Innovation416-593-3655stjon@osc.gov.on.caYan Kiu ChanSenior AdvisorGlobal and Domestic Affairs416-204-8971ychan@osc.gov.on.ca
Innovation Functions Co-operation Agreement
Between
The Hong Kong Securities and Futures Commission
and
The Ontario Securities Commission |
The Autorité des marchés financiers (Québec) |
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British Columbia Securities Commission |
The Alberta Securities Commission |
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The Financial and Consumer Affairs Authority of Saskatchewan |
The Manitoba Securities Commission |
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The Financial and Consumer Services Commission (New Brunswick) |
The Nova Scotia Securities Commission |
Contents
1 Definitions
2 Introduction
3 Purpose
4 Principles
5 Scope
6 Confidentiality & Permissible Uses
7 Term
8 Amendment
9 Additional Parties to the Agreement
Appendix A: Designated Innovation Functions Contact Persons
1. Definitions
For the purposes of this Co-operation Agreement, unless the context requires otherwise:
• "Authorisation" means the process of licensing, registering, approving, authorising, granting exemptive relief, or otherwise bringing an entity under an Authority's regulatory ambit so that they are authorised to carry on business in providing a financial service or issuing a financial product in the relevant Authority's jurisdiction, and "Authorised" has a corresponding meaning;
• "Authority" means the Hong Kong Securities and Futures Commission (SFC) or a Canadian Authority and shall collectively be referred to as "the Authorities";
• "Canadian Authority" means a securities regulatory authority established in Canada under provincial or territorial statute, that is a signatory or has signed on to this Co-operation Agreement pursuant to Article 9 and is listed in Appendix A.;
• "Criteria for Support" means the criteria of a Referring Authority that an Innovator Business is required to meet before the Referring Authority refers the Innovator Business to a Receiving Authority;
• "Innovation Function" means the dedicated function established by an Authority to support innovation in financial services in their respective markets;
• "Innovator Business" means an innovative financial business that has been offered support from an Authority through its Innovation Function, or would qualify for such support;
• "Receiving Authority" means:
(a) Where the Referring Authority is the SFC, any Canadian Authority to which a referral is made under the agreement, or
(b) Where the Referring Authority is a Canadian Authority, the SFC;
• "Referring Authority" means the Authority that is referring an Innovator Business to the Receiving Authority; and
• "Regulations" means any securities acts, regulations, regulatory requirements or guidelines applicable in the jurisdiction of an Authority.
2. Introduction
2.1. The Authorities share a mutual desire to promote innovation in financial services in their respective markets. The Authorities have established Innovation Functions in order to do so. The Authorities believe that through co-operation with each other, they will be able to further the promotion of innovation in their respective markets.
2.2. The SFC established the Fintech Contact Point (FTCP) in March 2016 to enhance communication with businesses involved in the development and application of Fintech in Hong Kong. The purpose of the Fintech Contact Point is to facilitate the Fintech community's understanding of the current regulatory regime, and to enable the SFC to stay abreast of the development of Fintech in Hong Kong.
2.3. On February 23, 2017, Canadian securities regulatory authorities launched the CSA Regulatory Sandbox, an initiative that supports innovative businesses across Canada. The Regulatory Sandbox helps in developing an in-depth understanding of new securities-related business models that use technology solutions.
Support offered through the Innovation Functions
2.4. The support offered by the Authorities to Innovator Businesses through their Innovation Functions may include:
2.4.1. A dedicated team and/or a dedicated contact for each Innovator Business;
2.4.2. Help for Innovator Businesses to understand the Regulations in the relevant Authority's jurisdiction, and how they apply to their business and them;
2.4.3. Assistance during the pre-Authorisation application phase to:
2.4.3.1. Discuss the Authorisation application process and any Regulations issues that the Innovator Business has identified; and
2.4.3.2. Ensure the Innovator Business understands the relevant Authority's Regulations and what it means for them.
2.4.4. Support during the Authorisation process, including the allocation of Authority's staff who are knowledgeable about financial innovation in their respective markets, to consider the application.
2.4.5. A dedicated contact person after an Innovator Business is Authorised.
3. Purpose
The purpose of this Co-operation Agreement is to provide a framework for cooperation and referrals between the Innovation Functions of the SFC and any Canadian Authority. The framework centres on a referral mechanism which will enable the Authorities to refer Innovator Businesses to their respective Innovation Functions. It also sets out how the Authorities plan to share and use information on innovation in their respective markets.
4. Principles
4.1. The Authorities intend to provide the fullest possible mutual assistance to one another within the terms of this Co-operation Agreement. This Co-operation Agreement shall be subject to the domestic laws and Regulations of each Authority and shall not modify or supersede any applicable laws and Regulations in force in, or applicable to, any such Authority's respective jurisdiction. This Co-operation Agreement sets forth a statement of intent and accordingly does not create any enforceable rights, and is not legally binding. This Co-operation Agreement is intended to complement, but not affect or alter the terms and conditions of any other multilateral or bilateral arrangements concluded between the Authorities or between the Authorities and third parties.
4.2. This Co-operation Agreement is a bilateral arrangement between each Canadian Authority and the SFC and should not be considered a bilateral agreement between any Canadian Authority.
5. Scope
Referral mechanism
5.1. The Authorities, through their Innovation Functions, will refer to each other Innovator Businesses that would like to operate in the other's jurisdiction.
5.2. Referrals will be made in writing, and shall include information demonstrating that the Innovator Business seeking to operate in the Receiving Authority's jurisdiction meets, or would meet, the Referring Authority's Criteria for Support.
5.3. The Criteria for Support should include, but shall not be limited to, the following:
5.3.1. The Innovator Business shall offer innovative financial products or services that benefit the consumer, investor and/or industry; and
5.3.2. The Innovator Business shall demonstrate that they have conducted sufficient background research on the Receiving Authority's Regulations as they might apply to it.
5.4. Following referral, and provided the Innovator Business meets the Criteria for Support, the Receiving Authority's Innovation Function may offer support to the Innovator Business in accordance with paragraph 2.4 above.
5.5. The Referring Authority acknowledges that when a Receiving Authority provides assistance to an Innovator Business, the Receiving Authority is not expressing an opinion about whether an Innovator Business will ultimately meet the requirements for Authorisation in its jurisdiction.
Information sharing
5.6. The Authorities intend, subject to applicable domestic laws and Regulations, to:
5.6.1. Share information about innovations in financial services in their respective markets, where appropriate. This may include, but is not limited to:
5.6.1.1. Emerging trends and developments (including use of new technologies); and
5.6.1.2. Regulatory issues pertaining to innovation in financial services;
5.6.2. Share further information on an Innovator Business which has been referred to a Receiving Authority for support through its Innovation Function by a Referring Authority (including the nature of the support to the Innovator Business by the Referring Authority); and
5.6.3. Notify each other of any material changes to the other Authority's Criteria for Support.
6. Confidentiality & Permissible Uses
6.1. Any information disclosed by the SFC to a Canadian Authority or by a Canadian Authority to the SFC under paragraphs 5.1 to 5.6 should be treated by the other Authority as confidential information.
6.2. Information about an Innovator Business included in a referral under paragraphs 5.1 to 5.4 and shared under paragraph 5.6 should be sent to a Receiving Authority only if the Innovator Business consents to that disclosure in writing and provides such consent to both the SFC and to the Canadian Authority. Where the Receiving Authority is a Canadian Authority, the said consent should also include consent for the Receiving Authority to share such information with any other Canadian Authority, which may include sharing through the CSA Regulatory Sandbox, provided that such sharing is done only for the same purposes pursuant to which the Referring Authority shared the information with the Receiving Authority. Such consent can be withdrawn by the Innovator Business at any time.
6.3. A Receiving Authority should use information disclosed to it by a Referring Authority pursuant to this Co-operation Agreement only for the purpose for which the information was disclosed, unless the Innovator Business and the Referring Authority consents to other uses. For greater clarity, a Receiving Authority may use information about a referred Innovator Business for the purpose of providing support to the referred Innovator Business through the Receiving Authority's Innovation Function and to seek to ensure compliance with the domestic laws and Regulations of the Receiving Authority's jurisdiction.
6.4. If any Canadian Authority is required to disclose any information provided to it by the SFC or if the SFC is required to disclose any information provided to it by any Canadian Authority pursuant to a requirement of law, such Authority should notify the other Authority prior to complying with such a requirement and should assert all appropriate legal exemptions or privileges with respect to such information as may be available.
7. Term
7.1. This Co-operation Agreement takes effect from the date of execution for all parties, or on the date determined in accordance with each Authority's applicable legislation.
7.2. Each of the SFC or any Canadian Authority may terminate this Agreement by giving at least 30 days' written notice of termination to the other Authorities. If this Co-operation Agreement is terminated by one or more than one Canadian Authority, it will continue to have effect only as between the SFC and any other remaining Canadian Authority.
7.3. In the event of the termination of this Co-operation Agreement, information obtained under this Co-operation Agreement will continue to be treated in the manner set out under paragraphs 6.1 to 6.4.
8. Amendment
8.1. The Authorities may review the operation of this Co-operation Agreement and update its terms as required. The Authorities acknowledge that review may be required if there is a material change to the support offered by a Receiving Authority's Innovation Function to Innovator Businesses referred by a Referring Authority pursuant to paragraph 5.1 or to the Criteria for Support.
8.2. This Co-operation Agreement may be amended if all of the Authorities agree in writing to do so.
9. Additional Parties to the Agreement
Any other Canadian securities regulatory authority may become a party to this Co-operation Agreement by executing a counterpart hereof together with the SFC and providing notice to the other signatories which are parties to this Co-operation Agreement, pursuant to which their contact details shall be added to Appendix A.
Executed by the Authorities:
This Co-operation Agreement will be effective from the date of its signing by the Authorities or on the date determined in accordance with each Authority's applicable legislation.
For the Hong Kong Securities and Futures Commission
For the Ontario Securities Commission
"Ashley Alder"
"Grant Vingoe"
____________________
____________________
Ashley Alder
Grant Vingoe
CEO
Chair and CEO
June 30, 2021
June 30, 2021
____________________
____________________
Date
Date
For the Autorité des marchés financiers (Québec)
For the British Columbia Securities Commission
"Louis Morisset"
"Brenda Leong"
____________________
____________________
Louis Morisset
Brenda Leong
President and CEO
Chair and CEO
June 30, 2021
June 17, 2021
____________________
____________________
Date
Date
For the Alberta Securities Commission
For the Financial and Consumer Affairs Authority of Saskatchewan
"Stan Magidson"
"Roger Sobotkiewicz"
____________________
____________________
Stan Magidson
Roger Sobotkiewicz
Chair and CEO
Chair and CEO
June 24, 2021
June 18, 2021
Date
Date
For the Manitoba Securities Commission
For the Financial and Consumer Services Commission (New Brunswick)
"David Cheop"
"Kevin Hoyt"
David Cheop
Kevin Hoyt
Chair and CEO
CEO
June 28, 2021
June 15, 2021
Date
Date
For the Nova Scotia Securities Commission
"Paul Radford"
____________________
Paul Radford
Chair
June 30, 2021
____________________
Date
Securities and Futures Commission |
Ontario Securities Commission |
Fintech Unit |
OSC LaunchPad Co-operation Requests: |
Intermediaries Division |
20 Queen Street West, 20th Floor |
Securities and Futures Commission |
Toronto ON, M5H 3S8 |
54/F One Island East |
Email: osclaunchpad@osc.gov.on.ca |
18 Westlands Road |
Telephone: (416) 596-4266 |
Quarry Bay, Hong Kong |
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fintech@sfc.hk |
|
Autorité des marchés financiers (Québec) |
British Columbia Securities Commission |
Director, FinTech and Innovation |
Fintech and Innovation Team |
800, Square-Victoria, 22e étage |
701 West Georgia Street |
Montréal (Québec) H4Z 1G3 |
P.O. Box 10142 Pacific Centre |
Email: fintech@lautorite.qc.ca |
Vancouver (British Columbia) V7Y 1L2 |
With a copy of Notice of termination (paragraph 7.2) to Corporate Secretary and Executive |
Tel: 604 899-6854 |
Director, Legal Affairs |
Email: fit@bcsc.bc.ca |
Email: secretariat@lautorite.qc.ca |
Copy to: COMMSEC@bcsc.bc.ca |
Alberta Securities Commission |
Financial and Consumer Affairs Authority of Saskatchewan |
Denise Weeres |
Sonne Udemgba |
Director, New Economy |
Director, Legal |
Alberta Securities Commission |
Securities Division |
Suite 600, 250-5th Street SW, Calgary, AB, T2P 0R4 |
601-1919 Saskatchewan Drive |
Phone: 403.297.2930 |
Regina (SK) S4P 4H2 |
Fax: 403.297.2082 |
Office: 306 787-5879 |
Email: Denise.Weeres@asc.ca |
Fax: 306 787-5899 |
Email: sonne.udemgba@gov.sk.ca |
|
Manitoba Securities Commission |
Financial & Consumer Services Commission (New Brunswick) |
Chris Besko |
Deputy Director, Policy, Securities Division |
Director, General Counsel |
85 Charlotte Street, Suite 300 |
500-400 St. Mary Avenue |
Saint John, NB |
Winnipeg (Manitoba) R3C 4K5 |
E2L 2J2 |
Tel.: 204 945-2561 |
Email: Registration-inscription@fcnb.ca |
Fax: 204 945-0330 |
Tel.: 506 658-3060 |
Toll free: 1 800 655-5244 |
|
Email: Chris.Besko@gov.mb.ca |
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Nova Scotia Securities Commission |
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Executive Director |
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Suite 400, Duke Tower |
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5251 Duke Street |
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Halifax (NS) B3J 1P3 |
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Tel.: 902 424-7768 |
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Email: nsscexemptions@novascotia.ca |
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Troy Richard James Hogg et al. -- s. 126(7)
FILE NO.: 2021-22
PROCEEDING TYPE: Other Application
HEARING DATE AND TIME: July 14, 2021 at 10:00 a.m.
LOCATION: By Teleconference
The purpose of the proceeding is to consider whether the Commission should vary a freeze direction dated November 13, 2020, as requested in the Application dated June 22, 2021.
The hearing set for the date and time indicated above is the first attendance in this proceeding, as described in subsection 7(1) of the Commission's Practice Guideline.
Any party to the proceeding may be represented by a representative at the hearing.
IF A PARTY DOES NOT ATTEND, THE HEARING MAY PROCEED IN THE PARTY'S ABSENCE AND THE PARTY WILL NOT BE ENTITLED TO ANY FURTHER NOTICE IN THE PROCEEDING.
This Notice of Hearing is also available in French on request of a party. Participation may be in either French or English. Participants must notify the Secretary's Office in writing as soon as possible if the participant is requesting a proceeding be conducted wholly or partly in French.
L'avis d'audience est disponible en français sur demande d'une partie, que la participation à l'audience peut se faire en français ou en anglais et que les participants doivent aviser le Bureau du secrétaire par écrit dès que possible si le participant demande qu'une instance soit tenue entièrement ou partiellement en français.
Dated at Toronto this 2nd day of July, 2021.
For more information
Please visit www.osc.ca or contact the Registrar at registrar@osc.gov.on.ca.
Troy Richard James Hogg et al.
FOR IMMEDIATE RELEASE
July 2, 2021
TORONTO -- The Office of the Secretary issued a Notice of Hearing to consider whether the Commission should vary a freeze direction dated November 13, 2020, as requested in the Application dated June 22, 2021.
A preliminary attendance will be held on July 14, 2021 at 10:00 a.m.
A copy of the Notice of Hearing dated July 2, 2021 and the Application dated June 22, 2021 are available at www.osc.ca.
For Media Inquiries:
For General Inquiries:
Mek Global Limited and PhoenixFin Pte. Ltd.
FOR IMMEDIATE RELEASE
July 6, 2021
TORONTO -- The Commission issued an Order in the above named matter.
A copy of the Order dated July 6, 2021 is available at www.osc.ca.
For Media Inquiries:
For General Inquiries:
FOR IMMEDIATE RELEASE
July 6, 2021
TORONTO -- Take notice that the oral closing submissions in the merits hearing in the above named matter scheduled to be heard on July 8 and July 9, 2021 will not proceed as scheduled.
For Media Inquiries:
For General Inquiries:
Trans-Canada Capital Inc. and TCC Alphabet Master Fund, LP
National Instrument 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- Mutual fund that is not a reporting issuer and requires financial statements of underlying funds granted 90-day extension of the annual financial statement filing and delivery deadlines under NI 81-106, subject to conditions.
National Instrument 81-106 Investment Fund Continuous Disclosure, ss. 2.2, 5.1(2)(a) and 17.1.
June 28, 2021
The principal regulator in the Jurisdiction has received an application from TCC on behalf of the Fund for a decision under the securities legislation of the Jurisdiction (the "Legislation") exempting the Fund from the following requirements of National Instrument 81-106 Investment Fund Continuous Disclosure ("NI 81-106"):
1. The requirement in section 2.2 that the Fund file its audited annual financial statements and auditor's report on or before the 90th day after the Fund's most recently completed financial year (the "Annual Filing Deadline"); and
2. The requirement in paragraph 5.1(2)(a) that the Fund deliver to its securityholders its audited annual financial statements by the Annual Filing Deadline (the "Annual Delivery Requirement")
to permit the Fund an extension of the Annual Filing Deadline and the Annual Delivery Requirement to June 30 of each year (the "Requested Relief").
This decision is based on the following facts represented by TCC:
TCC
1. Air Canada Pension Investment ("ACPI") was a division of Air Canada ("AC") responsible for the management of 8 AC employee Canadian defined benefit pension plans (and other AC employee savings plans), which with $23B in assets under management, are collectively the second-largest pension plan of a publicly traded company in Canada.. All ACPI's responsibilities were transferred to TCC as described below.
2. TCC was incorporated on March 12, 2018 under the Canada Business Corporations Act, with its head office and principal place of business in Montreal, Quebec, and is a wholly owned subsidiary of AC.
3. On January 1, 2019, ACPI officially became TCC (the TCC team is composed of existing members of ACPI), following which, as per an Investment Management Agreement with AC, it began to manage investment assets for the AC pension plans (directly and indirectly through six (6) specialized investment funds), third-party sophisticated institutional and eventually high net worth clients.
4. TCC is currently registered as an Exempt Market Dealer in Alberta, British Columbia, Manitoba, Nova Scotia, Ontario and Quebec, and as a Portfolio Manager, Investment Fund Manager and Derivatives Portfolio Manager/Commodity Trading Manager in Ontario and Quebec.
5. TCC is the Investment Fund Manager and Portfolio Manager of the Fund as per an Investment Management Agreement.
6. TCC is not a reporting issuer in any jurisdiction and is not in default of securities legislation of any jurisdiction of Canada.
The Fund
7. The Fund is a Limited Partnership formed under the laws of the Province of Ontario pursuant to a Limited Partnership Agreement dated November 2, 2020.
8. The Fund is both an investment fund and a mutual fund for the purposes of NI 81-106.
9. Units of the Fund are only offered for sale and distribution on a continuous basis to qualified investors in Alberta, British Columbia, Manitoba, Nova Scotia, Ontario and Quebec pursuant to an exemption from the prospectus requirements under National Instrument 45-106 Prospectus and Registration Exemptions.
10. Currently, the Fund has only one securityholder, which is a sophisticated institutional investor, the Air Canada Pension Master Trust Fund (the "Fund Securityholder").
11. The Fund is not a reporting issuer in any jurisdiction.
12. The Fund is currently in default of the Annual Filing Deadline and the Annual Delivery Requirement (the "Default").
13. The Fund has a financial year-end of December 31.
14. The Fund invests in units of Underlying Funds which are all private commingled funds individually independently managed by external investment managers (not related to TCC) which investments are consistent with the Fund's investment objectives and strategies.
Financial Statements
15. As the Fund's financial year-end is December 31, it has a filing and delivery deadline of March 31 under the Annual Filing Deadline and the Annual Delivery Requirement.
16. Section 2.11 of NI 81-106 provides an exemption from the Annual Filing Deadline if, among other things, an investment fund delivers its annual financial statements to its securityholders in accordance with Part 5 of NI 81-106 by the Annual Filing Deadline (the "Filing Exemption").
17. In order to audit the information contained in and formulate an opinion on the Fund's financial statements, the Fund's auditor requires audited financial statements of the respective Underlying Funds that the Fund invests in. The Fund has realized that it will be unable to complete the financial statements and to submit them to the auditor until the audited financial statements of the Underlying Funds are completed and available to the Fund.
18. The Underlying Funds have varied financial year ends and are subject to a variety of financial reporting deadlines. Therefore, in most cases, the Fund will not be able to obtain the financial statements of the Underlying Funds sooner than the deadline for delivering the financial statements of the Fund and, in all cases, no sooner than other securityholders of the Underlying Funds receive the financial statements of the Underlying Funds.
19. The Fund has concluded that it will not be able to rely on the Filing Exemption since it is unable to prepare and deliver the financial statements and auditor's report within ninety (90) days after the Fund's most recently completed financial year.
20. The Fund was not able to file its annual audited financial statements by the Annual Filing Deadline. As a result, the Fund was not able to meet the Annual Delivery Requirement. The Fund expects this timing delay in the completion of its annual audited financial statements to occur every year for the foreseeable future.
21. The Fund therefore seeks an extension of the Annual Filing Deadline and the Annual Delivery Requirement to June 30 of each year, to enable the Fund's auditor to first receive the audited financial statements of the Underlying Funds so as to be able to prepare the Fund's annual audited financial statements.
22. The Fund has notified the Fund Securityholder of the Default, that it has applied for relief from the Annual Filing Deadline and Annual Delivery Requirement and that, if granted, it intends to rely on the relief.
The principal regulator in the Jurisdiction 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 in the Jurisdiction under the Legislation is that the Requested Relief is granted provided that:
1. The Fund has a financial year ended December 31;
2. Consistent with the Fund's investment objectives and strategies, the Fund invests the majority of its assets in Underlying Funds that are private funds managed by independent managers;
3. No less than 25% of the total assets of the Fund, at the time the Fund makes the initial investment decision in the Underlying Funds, are invested in investment entities that have financial reporting periods that end on December 31 of each year and are subject to laws of their jurisdictions that require their financial statements to be delivered within 120 days of their financial year ends;
4. On behalf of the Fund, within 60 days of the date hereof, TCC will notify the Fund Securityholder that the Fund has received and intends to rely on relief from the Annual Filing Deadline and Annual Delivery Requirement;
5. If TCC distributes securities of the Fund to investors other than the Fund Securityholder after the date of this decision, TCC will immediately amend the offering memorandum of the Fund to disclose to investors that the audited annual financial statements for the Fund will be delivered within 180 days of the Fund's most recently completed financial year;
6. The Fund is not a reporting issuer and TCC has the necessary registrations to carry out its operations in each jurisdiction of Canada in which it operates;
7.
(a) The audited annual financial statements of the Fund are filed on or before the 180th day after the Fund's most recently completed financial year; or
(b) the conditions in section 2.11 of NI 81-106 are met, except for subsection 2.11(b), and the audited annual financial statements are delivered to securityholders of the Fund in accordance with Part 5 of NI 81-106 on or before the 180th day after the Fund's most recently completed financial year; and
8. The Requested Relief terminates within one year of the coming into force of any amendment to NI 81-106 or other rule that modifies how the Annual Filing Deadline or Annual Delivery Requirement applies in connection with mutual funds.
Waypoint Investment Partners Inc.
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- Relief granted from section 13.5(2)(b)(ii) and (iii) of NI 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations to permit inter-fund trades and in-specie transfers between public funds and managed accounts and public funds, with inter-fund trades at the last sale price, subject to conditions.
National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations, ss. 13.5 and 15.1.
National Instrument 81-107 Independent Review Committee for Investment Funds, ss. 6.1(2) and 6.1(4).
June 29, 2021
The principal regulator in the Jurisdiction has received an application (the Application) from the Filer for a decision under the securities legislation of the Jurisdiction (the Legislation) exempting the Filer from the prohibitions in subsections 13.5(2)(b)(ii) and (iii) of National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations (NI 31-103) which prohibit a registered adviser from knowingly causing an investment portfolio managed by it, including an investment fund for which it acts as an adviser, from purchasing or selling a security from or to the investment portfolio of an associate of a responsible person, or from or to the investment portfolio of an investment fund for which a responsible person acts as an adviser, in order to permit:
(a) Waypoint All Weather Alternative Fund (the Existing Fund) and any future investment funds of which the Filer is the manager and to which National Instrument 81-102 Investment Funds (NI 81-102) applies (each a Future Fund and, collectively with the Existing Fund, the Funds and each a Fund) to purchase securities from or sell securities to another Fund;
(b) A fully managed account for which the Filer acts or will act as portfolio manager (each, a Managed Account and, collectively, the Managed Accounts) to purchase securities from or sell securities to a Fund (the transactions referred to in paragraphs (a) to (b) are referred to collectively herein as the Inter-Fund Trades);
(c) the Inter-Fund Trades to be executed at the last sale price, as defined in the Universal Market Integrity Rules of the Investment Industry Regulatory Organization of Canada, prior to the execution of the trade (the Last Sale Price) in lieu of the closing sale price (the Closing Sale Price) contemplated by the definition of "current market price of the security" in Section 6.1(1)(a)(i) of National Instrument 81-107 Independent Review Committee for Investment Funds (NI 81-107) on that trading day where the securities involved in the Inter-Fund Trade are exchange-traded securities (which term shall include Canadian and foreign exchange-traded securities); and
(d) in-specie subscriptions and redemptions by a Managed Account in a Fund (each such subscription or redemption, an In-Specie Transfer).
The relief requested in paragraphs (a) to (c) is collectively, the Inter-Fund Relief, the relief requested in paragraph (d) is the In-Specie Relief, collectively with the Inter-Fund Relief, the Requested Relief.
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission is the principal regulator for this Application; and
(b) the Filer has provided notice that subsection 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in each of the other provinces and territories of Canada (together with Ontario, the Canadian Jurisdictions).
Terms defined in National Instrument 14-101 -- Definitions, NI 81-102, NI 81-107, NI 31-103 or the securities legislation of Ontario have the same meaning in this Application (unless otherwise defined herein).
This decision is based on the following facts represented by the Filer:
General
1. The Filer is a corporation formed under the laws of Ontario with its head office located in Toronto, Ontario. The Filer is registered as an investment fund manager in the provinces of Ontario, Quebec and Newfoundland and Labrador and as an adviser in the category of portfolio manager and as an exempt market dealer in each of the provinces of Canada.
2. The Filer is, or will be, the investment fund manager of the Funds and the portfolio manager for the Funds and the Managed Accounts.
3. Each Fund is, or will be, established under the laws of Ontario or Canada as an investment fund that is a trust, a class of shares of a mutual fund corporation or limited partnership and is, or will be, a reporting issuer in one or more of the Canadian Jurisdictions.
4. The securities of each Fund are, or will be, qualified for distribution in one or more of the Canadian Jurisdictions under, as applicable, a prospectus, simplified prospectus, annual information form, fund facts and/or ETF facts, prepared and filed in accordance with the securities legislation of such Canadian Jurisdictions. Each Fund is, or will be, subject to the provisions of NI 81-102.
5. The Filer and the Existing Fund are not in default of the securities legislation of any Canadian Jurisdiction.
6. The Filer offers discretionary investment management services to investors in Canada through the Managed Accounts (each a Managed Account Client).
7. Each Managed Account Client has entered into, or will enter into, a written agreement (an Investment Management Agreement) whereby the client appoints the Filer to act as portfolio manager in connection with an investment portfolio of the client with full discretionary authority to trade in securities for the Managed Account without obtaining the specific consent of the client to execute each trade.
Inter-Fund Trades
8. The Filer wishes to be able to permit Inter-Fund Trades of portfolio securities between a Fund and another Fund or a Managed Account.
9. Section 13.5(2)(b) of NI 31-103 restricts a Fund or a Managed Account from entering into Inter-Fund Trades.
10. Because of the various investment objectives and investment strategies utilized by the Funds and Managed Accounts, it may be appropriate for the different investment portfolios to acquire or dispose of the same securities through the same trading system via an Inter-Fund Trade, rather than with a third party. The Filer has determined that there are significant benefits to be achieved by the Funds and Managed Accounts if the potential counterparties are expanded to include other Funds. These benefits include lower trading costs, reduced market disruption and quicker execution as well as simpler and more reliable compliance procedures.
11. The Filer has also determined that it would be in the interests of the Funds and Managed Accounts to receive the Inter-Fund Relief because making Funds and Managed Accounts subject to the same set of rules governing the execution of Inter-Fund Trades will result, in connection with the execution of transactions on behalf of Funds and Managed Accounts, in:
(a) cost and timing efficiencies; and
(b) less complicated and more reliable compliance procedures, as well as simplified and more efficient monitoring of same for the Filer.
12. Each Inter-Fund Trade will be consistent with the investment objectives of the relevant Fund or Managed Account, as applicable.
13. At the time of an Inter-Fund Trade, the Filer will have in place policies and procedures to enable the Funds and the Managed Accounts to engage in Inter-Fund Trades.
14. The Filer has established an independent review committee (IRC) in respect of the Existing Fund in accordance with NI 81-107. Any Future Fund will also become part of the mandate of the IRC.
15. Inter-Fund Trades involving a Fund will be referred to the IRC of such Fund under section 5.2(1) of NI 81-107, and the Filer, as the manager of the Funds, and the IRC of the Funds will comply with section 5.4 of NI 81-107 in respect of any standing instruction the IRC provides in connection with the Inter-Fund Trade. The IRC of the Funds will not approve an Inter-Fund Trade involving a Fund unless it has made the determination set out in section 5.2(2) of NI 81-107.
16. Prior to engaging in Inter-Fund Trades on behalf of a Managed Account, each Investment Management Agreement or other documentation in respect of each Managed Account will contain authorization from the client for the portfolio manager of the Managed Account to engage in Inter-Fund Trades.
17. Subsection 6.1(4) of NI 81-107 provides relief from Section 13.5(2)(b), but only if, among other conditions, both sides of the inter-fund trade are investment funds managed by the same manager, both are subject to NI 81-107 and the transaction is executed at Closing Sale Price.
18. The Filer cannot rely on the exemption codified under subsection 6.1(4) of NI 81-107 unless each party to the transaction is a reporting issuer, which will not be the case for Managed Accounts, and the Inter-Fund Trade occurs at the "current market price of the security" which, in the case of exchange-traded securities, includes the Closing Sale Price but not the Last Sale Price.
19. The Filer considers that it would be in the best interests of the Funds and Managed Accounts, as applicable, if an Inter-Fund Trade could be made at the Last Sale Price prior to the execution of the trade, in lieu of the Closing Sale Price, as this will result in the trade being done at the price which is closest to the price at the time the decision to make the trade is made.
20. Generally, the following procedures or other similar procedures will be followed when entering into Inter-Fund Trades if the Inter-Fund Relief is granted:
(a) the portfolio manager of the Filer will request the approval of the Chief Compliance Officer of the Filer or his or her designated alternate to execute a purchase or sale of a security by a Fund or a Managed Account as an Inter-Fund Trade;
(b) upon receipt of the required approval, the portfolio manager of the Filer will deliver the trading instructions to a trader on a trading desk of the Filer;
(c) upon receipt of the trade instructions and the required approval, the trader on the trading desk will execute the trade as an Inter-Fund Trade in accordance with the requirements of paragraphs (c) to (g) of subsection 6.1(2) of NI 81-107 provided that, for exchange-traded securities, the Inter-Fund Trade may be executed at the Last Sale Price of the security in lieu of the Closing Sale Price; and
(d) the policies applicable to the trading desk of the Filer will require that all orders are to be executed on a timely basis.
In-Specie Transfers
21. Investments in individual securities may not be appropriate in certain circumstances for a Managed Account Client. Consequently, the Filer may, where authorized under the applicable Investment Management Agreement, from time to time, invest the assets in a Managed Account in securities of any one or more of the Funds in order to give such Managed Account Client the benefit of asset diversification and economies of scale regarding minimum commission charges on portfolio trades and generally to facilitate portfolio management.
22. The Filer may wish a Managed Account to deliver or receive portfolio securities in respect of a purchase or redemption, respectively, of units or shares of a Fund (Fund Securities).
23. Prior to engaging in In-Specie Transfers on behalf of a Managed Account, each Investment Management Agreement or other documentation will contain the authorization of the Managed Account Client for the portfolio manager of the Managed Account to engage in In-Specie Transfers.
24. The only cost which will be incurred by a Managed Account or Fund for an In-Specie Transfer is a nominal administrative charge levied by the custodian of the relevant Fund in recording the trades, and any commission charged by the dealer executing the trade.
25. The Filer, as manager of the Funds, will value the securities transferred under an In-Specie Transfer on the same valuation day on which the purchase price or redemption price of the Fund Securities of a Fund is determined. With respect to the purchase of Fund Securities of a Fund, the securities transferred to a Fund under an In-Specie Transfer in satisfaction of the purchase price of those Fund Securities will be valued as if the securities were portfolio assets of the Fund, as contemplated by section 9.4(2)(b)(iii) of NI 81-102. With respect to the redemption of Fund Securities of a Fund, the securities transferred to a Managed Account in satisfaction of the redemption price of those Fund Securities will have a value equal to the amount at which those securities were valued in calculating the net asset value per security used to establish the redemption price of the Fund Securities of the Fund, as contemplated by section 10.4(3)(b) of NI 81-102.
26. The valuation of any illiquid securities which would be the subject of an In-Specie Transfer will be carried out according to the Filer's policies and procedures for the fair valuation of portfolio securities, including illiquid securities. Should any In-Specie Transfer contemplated specifically by the Requested Relief involve the transfer of an "illiquid asset" (as defined in NI 81-102), the Filer will obtain at least one quote for the asset from an independent arm's length purchaser or seller, immediately before effecting the In-Specie Transfer. If any illiquid securities are the subject of an In-Specie Transfer, the illiquid securities will be transferred on a basis that fairly represents the portfolio of the Managed Account or Fund.
27. In-Specie Transfers will be subject to (i) compliance with the written policies and procedures of the Filer respecting In-Specie Transfers that are consistent with applicable securities legislation, and (ii) the oversight of the Chief Compliance Officer of the Filer to ensure that the transaction represents the business judgment of the Filer acting in its discretionary capacity with respect to the Managed Account, uninfluenced by considerations other than the best interests of the Managed Account.
Regulatory framework and reasons for the Requested Relief
28. As the Filer is, or will be, the portfolio manager of the Funds and is, or will be, the portfolio manager of the Managed Accounts, the Filer would be considered a "responsible person" within the meaning of NI 31-103.
29. As the Filer is, or may be in the future, the trustee of a Fund which is organized as a trust, each such Fund may be an "associate" of the Filer, and therefore an "associate" of a "responsible person" within the meaning of NI 31-103.
30. Absent the grant of the Inter-Fund Relief and the In-Specie Relief, the Filer could be precluded by paragraphs 13.5(2)(b)(i) and (ii) of NI 31-103 from effecting the Inter-Fund Trades and In-Specie Transfers in such circumstances. Pursuant to these restrictions,
(a) a Fund or a Managed Account, as applicable, may be restricted from making Inter-Fund Trades with another Fund if:
(i) the other Fund is an associate of a responsible person, which will be the case on each occasion that the other Fund is structured as a trust and the Filer is the trustee of the Fund; or
(ii) a responsible person of the Fund or of the Managed Account, as applicable, is an adviser to the other Fund, which will be the case for each other Fund.
(b) a Managed Account, as applicable, may be restricted from making In-Specie Transfers with a Fund if:
(i) the Fund is an associate of a responsible person, which will be the case on each occasion that the Fund is structured as a trust and the Filer is the trustee of the Fund; or
(ii) a responsible person of the Managed Account is an adviser to the Fund, which will be the case for each Fund.
31. The Filer has determined that it will be in the best interests of the Funds and the Managed Accounts to obtain the Requested Relief.
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:
(a) the Inter-Fund Relief is granted provided that:
(i) the Inter-Fund Trade is consistent with the investment objectives of the Fund or Managed Account, as applicable;
(ii) the Filer refers the Inter-Fund Trade to the IRC of the Fund involved in the manner contemplated by section 5.1 of NI 81-107 and the Filer and the IRC of the Fund comply with section 5.4 of NI 81-107 in respect of any standing instructions the IRC provides in connection with the Inter-Fund Trade;
(iii) the IRC of each Fund has approved the Inter-Fund Trade in respect of the Fund in accordance with the terms of subsection 5.2(2) of NI 81-107; and
(iv) the Inter-Fund Trade complies with paragraphs (c) to (g) of subsection 6.1(2) of NI 81-107 except that for purposes of paragraph (e) of subsection 6.1(2) of NI 81-107 in respect of exchange-traded securities, the current market price of the securities may be the Last Sale Price; and
(v) if the Inter-Fund Trade is with a Managed Account, the Investment Management Agreement or other documentation in respect of the Managed Account authorizes the Inter-Fund Trade and the authorization has not been revoked:
(b) the In-Specie Transfer Relief is granted provided that:
(i) the IRC of the Fund has approved the In-Specie Transfer in accordance with the terms of section 5.2 of NI 81-107;
(ii) the Filer and the IRC of the Fund comply with section 5.4 of NI 81-107 in respect of any standing instructions the IRC provides in connection with the In-Specie Transfer;
(iii) the Filer obtains the prior written consent of the client of the Managed Account before it engages in the In-Specie Transfer and the authorization has not been revoked;
(iv) if the transaction is the purchase of Fund Securities of a Fund by a Managed Account:
(1) the Fund would, at the time of payment, be permitted to purchase the portfolio securities;
(2) the portfolio securities are acceptable to the Filer, as portfolio manager of the Fund and consistent with the Fund's investment objectives;
(3) the value of the portfolio securities is equal to the issue price of the Fund Securities of the Fund for which they are used as payment, valued as if the securities were portfolio assets of that Fund;
(4) the account statement next prepared for the Managed Account describes the portfolio securities delivered to the Fund and the value assigned to such securities; and
(v) if the transaction is the redemption of Fund Securities of a Fund by a Managed Account:
(1) the portfolio securities are acceptable to the Filer as portfolio manager of the Managed Account and consistent with the Managed Account's investment objectives;
(2) the value of the portfolio securities is equal to the amount at which those securities were valued by the Fund in calculating the net asset value per Fund Security used to establish the redemption price;
(3) the holder of the Managed Account has not provided notice to terminate its Investment Management Agreement with the Filer;
(4) the account statement next prepared for the Managed Account describes the portfolio securities delivered to the Managed Account and the value assigned to such securities;
(vi) the Fund keeps written records of all In-Specie Transfers in a financial year of the Fund, reflecting details of the portfolio securities delivered to the Fund (in the case of purchases of Fund Securities by a Managed Account) and by the Fund (in the case of redemptions of Fund Securities by a Managed Account) and the value assigned to such securities, for at least five years after the end of the financial year, the most recent two years in a reasonably accessible place;
(vii) Filer does not receive any compensation in respect of any purchase or redemption of Fund Securities of a Fund, and in respect of any delivery of securities further to an In-Specie Transfer, the only charge paid by the Managed Account or Fund, if any, is a nominal administrative charge levied by the custodian in recording the trade and any commission charged by the dealer executing the trade; and
(viii) should any In-Specie Transfer involve the transfer of an "illiquid asset" (as defined in NI 81-102) the Filer will obtain at least one quote for the asset from an independent arm's length purchaser or seller, immediately before effecting the In-Specie Transfer (as contemplated by commentary #7 to section 6.1 of National Instrument 81-107 Independent Review Committee for Investment Funds).
BMO Private Investment Counsel Inc. and BMO Private Canadian Short-Term Bond Portfolio
National Policy 11-203 -- merger approval granted and relief granted from requirement to obtain approval for merger under National Instrument 81-102 Investment Funds of investors in terminating fund held in discretionary investment management arrangement with manager.
National Instrument 81-102 Investment Funds, ss. 5.1(1)(f), 5.5(1)(b), 5.5(3), 5.6 and 19.1.
June 29, 2021
The principal regulator in the Jurisdiction has received an application from the Filer on behalf of the Terminating Fund for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation):
(a) exempting the Terminating Fund from the requirement in subsection 5.1(1)(f) of NI 81-102 to obtain the prior approval of its unitholders for the Merger (defined below) (theUnitholder Approval Relief); and
(b) approving of the merger of the Terminating Fund into BMO Private Canadian Mid-Term Bond Portfolio (the Continuing Fund, together with the Terminating Fund, the Funds) (the Merger) pursuant to subsection 5.5(1)(b) of NI 81-102 (the Merger Approval, together with the Unitholder Approval Relief, the Requested Relief)
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission is the principal regulator for this application; and
(b) the Filer has provided notice that subsection 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in British Columbia, Alberta, Saskatchewan, Manitoba, Québec, New Brunswick, Nova Scotia, Newfoundland and Labrador and Prince Edward Island.
Terms defined in National Instrument 14-101 Definitions and MI 11-102 have the same meaning if used in this decision, unless otherwise defined. The following additional terms shall have the following meanings:
IRC means the Independent Review Committee for the Terminating Fund and the Continuing Fund;
NI 81-102 means National Instrument 81-102 Investment Funds;
NI 81-106 means National Instrument 81-106 Investment Fund Continuous Disclosure;
NI 81-107 means National Instrument 81-107 Independent Review Committee for Investment Funds; and
Tax Act means the Income Tax Act (Canada).
This decision is based on the following facts represented by the Filer:
The Filer and the Funds
1. The Filer is a corporation established under the laws of Ontario. The head office of the Filer is located in Toronto, Ontario.
2. The Filer, an indirect, wholly-owned subsidiary of Bank of Montreal, is registered as a portfolio manager and exempt market dealer in each of the provinces and territories of Canada, as an investment fund manager in Ontario, Newfoundland and Labrador and Quebec, as a commodity trading counsel and commodity trading manager in Ontario and as a derivatives portfolio manager in Quebec.
3. The Filer is the manager and portfolio manager of the Terminating Fund and the Continuing Fund. An affiliate of the Filer, BMO Trust Company, is the trustee of the Funds.
4. Each of the Funds is an open-ended mutual fund established as a trust under the laws of the Province of Ontario by declaration of trust.
5. The Funds are reporting issuers under the applicable securities legislation of each jurisdiction of Canada. Units of the Terminating Fund, the Continuing Fund and other mutual funds managed by the Filer are qualified for sale in each jurisdiction in Canada by a simplified prospectus dated May 7, 2021 (the BMO Private Portfolios).
6. Each Fund is governed by NI 81-102, subject to any relief therefrom granted by the securities regulatory authorities. Unless an exemption has been obtained, each of the Funds follows the standard investment restrictions and practices established by the securities regulatory authorities in each jurisdiction in Canada.
7. The net asset value for units of the Funds is calculated on a daily basis on each day that the Toronto Stock Exchange is open for trading.
8. Each Fund pays all expenses relating to its operation and the carrying on of its business. Although any sub-advisory fees (including taxes) are an expense of each Fund, under the management agreement, the Filer has agreed to absorb a portion of the sub-advisory fees, such that the Filer is reimbursed for sub-advisory fees incurred in excess of 0.15% of each Fund's net asset value (plus applicable tax).
9. Neither the Filer nor the Funds are in default of securities legislation in any jurisdiction of Canada.
10. The Filer offers fully discretionary investment management services to clients in each jurisdiction in Canada, including to all of the investors in the BMO Private Portfolios.
11. The BMO Private Portfolios were established as an efficient and cost effective means of providing discretionary investment management services to many of the Filer's clients, including all of the investors in the Terminating Fund and the Continuing Fund, as an alternative to segregated account management.
12. The Filer proposes to merge the Terminating Fund into the Continuing Fund on or about July 9, 2021.
13. Prior to or concurrently with the implementation of the Merger, the Filer anticipates changing the name of the Continuing Fund to BMO Private Canadian Short-Mid Bond Portfolio.
Unitholder Approval Relief
14. Paragraph 5.1(1)(f) of NI 81-102 requires that the approval of the securityholders of an investment fund be obtained before the investment fund undertakes a reorganization with, or transfers its assets to, another issuer.
15. The Filer has determined that it is appropriate to effect the Merger without obtaining unitholder approval.
16. Units of the Terminating Fund are only available for purchase by investors who have entered into a discretionary investment management agreement with the Filer.
17. The Filer is authorized under its discretionary investment management agreement with each client who is an investor in a BMO Private Portfolio to make any investment on behalf of the client (provided such investment is consistent with the mandate established by that client). Unitholders of a BMO Private Portfolio do not participate in the investment decision of purchasing, holding, or selling units of a BMO Private Portfolio. Instead, unitholders of any BMO Private Portfolio rely entirely on the Filer to make investment decisions for them, a service which these clients have sought.
18. Under its discretionary investment management agreement with each client, the Filer is authorized to receive all unitholder materials relating to the securities held in the client's account, and to vote on behalf of the client on any matters relating to the securities held in the client's account (provided that such vote is in the best interests of the client).
19. The unitholders of the Terminating Fund rely entirely on the Filer to make investment decisions for them and, in these circumstances, the Merger is analogous to the Filer changing a client's investment from one BMO Private Portfolio to another. As such investment changes do not require client approval, the Filer has determined that it is appropriate to effect the Merger without obtaining unitholder approval.
20. As every investor in the Terminating Fund has entered into a discretionary investment management agreement with the Filer, the Filer believes that sending meeting materials and convening unitholder meetings for the purpose of obtaining unitholder approval to effect the Merger is not desirable and represents an unnecessary cost and inconvenience to the Filer and the unitholders of the Terminating Fund.
21. Prior to, or no later than the next account statement mailing following the implementation of the Merger, the Filer will communicate with each client that holds units of the Terminating Fund to explain the changes to their account occurring as a result of the Merger.
22. The exception to unitholder approval for the Merger in subsection 5.3(2) of NI 81-102 would otherwise be available, except that the Merger does not meet the requirement (a) for the investment funds involved in a pre-approved reorganization or transfer to have substantially similar investment objectives pursuant to section 5.6 of NI 81-102 (as referenced below) and (b) that written notice of the Merger be sent at least 60 days before the effective date of the change, as a result of the Terminating Fund being held by its investors pursuant to a discretionary investment management arrangement with the Filer.
Merger Approval
23. Regulatory approval of the Merger is required because the Merger does not satisfy all of the criteria for pre-approved reorganizations and transfers as set out in section 5.6 of NI 81-102 because:
(a) a reasonable person may not consider the fundamental investment objectives of the Terminating Fund to be substantially similar to the fundamental investment objectives of the Continuing Fund, as contemplated in paragraph 5.6(1)(a)(ii) of NI 81-102;
(b) approval of the Merger will not be obtained by the unitholders of the Terminating Fund, as contemplated in paragraph 5.6(1)(e)(i) of NI 81-102; and
(c) materials will not be sent to the unitholders of the Terminating Fund in connection with the approval under paragraph 5.1(1)(f) of NI 81-102, as contemplated in paragraph 5.6(1)(f) of NI 81-102.
24. The Filer will, except as noted above, comply with all of the other criteria for pre-approved reorganizations and transfers, as set out in section 5.6 of NI 81-102.
25. A reasonable person may not consider the fundamental investment objectives of the Terminating Fund and the Continuing Fund to be substantially similar. However, both Funds have substantially similar investment strategies and mandates in that they both provide exposure to fixed income securities such as bonds and debentures issued by governments and corporations in Canada that mature in more than one year. The Terminating Fund's objectives are to produce a high level of interest income, and to preserve the capital invested, while the Continuing Fund's objective is to produce superior returns through a combination of interest income and capital growth while also pursuing capital preservation. The capital growth aspect of the investment objectives of the Continuing Fund permit it to hold a longer duration bond than the Terminating Fund. As a result, the broader investment objectives of the Continuing Fund permit it to hold both shorter-term (i.e. 1-5 years) and longer-term (i.e. 5-10 years) fixed income securities.
26. The proposed Merger is neutral to the unitholders of each of the Funds from a fee and expense perspective.
27. The Merger will be completed as a "qualifying exchange" within the meaning of section 132.2 of the Tax Act.
28. The portfolio assets of the Terminating Fund to be acquired by the Continuing Fund arising from the Merger are currently, or will be, acceptable, on or prior to the effective date of the Merger, to the portfolio advisor of the Continuing Fund and are or will be consistent with the investment objectives of the Continuing Fund. The Filer anticipates that no portfolio assets will be liquidated in anticipation of or as a result of the Merger and that there will only be portfolio turnover in the normal course of business for the Funds. The Filer views the Merger, on balance, as the best path towards combining the two Funds' mandates versus for example, implementing a redemption from the Terminating Fund and purchase of the Continuing Fund.
29. The Filer has concluded that the Merger does not represent a material change for the Continuing Fund.
30. The Merger will cause the Funds to have a deemed year end on the date of the Merger. The Filer anticipates that the Terminating Fund will not require a capital gains distribution, as it will use available capital losses to offset any capital gains. The Filer anticipates that the Continuing Fund will have capital gains for distribution to taxable investors. The Filer will include information on the tax consequences of the Merger in a communication sent to clients prior to, or no later than the next account statement mailing following the implementation of the Merger.
31. On April 7, 2021, the Filer presented the terms of the Merger to the IRC for its approval. The IRC reviewed the proposed Merger, determined that the Merger would achieve a fair and reasonable result for the Funds and has provided its approval in respect of the Merger.
32. Upon the approval of the Merger by the boards of directors of the Filer and of BMO Trust Company on April 30, 2021, a press release was issued and filed on April 30, 2021, a material change report describing the Merger and the final simplified prospectus for the Funds were also filed on SEDAR in accordance with the continuous disclosure obligations of the Terminating Fund in Part 11 of NI 81-106.
33. Units of the Terminating Fund will continue to be available for sale until the close of business on July 7, 2021, following which time the distribution of new units will cease, except under a continuous savings plan or similar systematic plan established prior to July 7, 2021.
34. Unitholders of the Terminating Fund will continue to have the right to redeem units of the Terminating Fund at any time up to the close of business on the business day immediately preceding the effective date of the Merger.
35. The Filer will bear the costs and expenses associated with the Merger, including any costs incurred in respect of any required sale of portfolio assets of the Terminating Fund.
36. Units of the Funds are not issued in separate series and do not charge sales charges or redemption charges. No sales charges or redemption charges will be payable in connection with the issuance of units of the Continuing Fund in exchange for the investment portfolio of the Terminating Fund.
37. Pursuant to the Merger, holders of units of the Terminating Fund will receive units of the Continuing Fund equivalent in value to their units of the Terminating Fund.
38. Following the Merger, the Continuing Fund will continue as a publicly offered open-ended mutual fund and the Terminating Fund will be wound up as soon as reasonably practicable.
39. The Filer believes that the Merger is in the best interests of the unitholders of the Terminating Fund and the Continuing Fund because:
(a) the Continuing Fund has delivered stronger long-term performance than the Terminating Fund;
(b) the Merger would result in unitholders being invested in a Continuing Fund with a portfolio of greater value, allowing for increased portfolio diversification opportunities;
(c) the Merger will be effected on a tax-deferred basis and thus will not trigger a capital gain or loss upon the transfer of each unitholder's investment from the Terminating Fund to the Continuing Fund; and
(d) the Merger will eliminate the administrative and regulatory costs of operating the Terminating Fund as a separate mutual fund.
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 Requested Relief is granted.
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- relief from subparagraph 2.6.1(1)(c)(ii) of NI 81-102 to permit a fund to short-sell up to 20% of NAV in a single issuer of "government securities" -- relief sought to allow fund to better implement strategy to short sell government bonds as a hedge against interest rate risk of corporate bond portfolio -- subject to conditions.
National Instrument 81-102 Investment Funds, ss. 2.6.1(1)(c)(ii) and 19.1
June 30, 2021
The principal regulator in the Jurisdiction has received an application from the Filer on behalf of Ninepoint Diversified Bond Fund (the Existing Fund) and any other existing or future investment funds managed by the Filer to which NI 81-102 applies (the Future Funds and collectively with the Existing Fund, theFunds) for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) for an exemption from paragraph 2.6.1(1)(c)(ii) of NI 81-102 to permit each Fund to increase the limit on aggregate short sale exposure to any single issuer that is a "government security" (as defined in NI 81-102) to 20% of the net asset value (NAV) of the Fund (the Exemption Sought).
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities 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 British Columbia, Alberta, Saskatchewan, Manitoba, Quebec, New Brunswick, Nova Scotia, Prince Edward Island, Newfoundland and Labrador, Northwest Territories, Yukon and Nunavut (the Other Jurisdictions and with Ontario, the Jurisdictions).
Terms defined in National Instrument 14-101 Definitions and MI 11-102 have the same meaning if used in this decision, unless otherwise defined.
The decision is based on the following facts represented by the Filer on behalf of itself and the Fund:
The Filer
1. The Filer is a limited partnership established under the laws of the Province of Ontario with its head office located in Toronto, Ontario.
2. The Filer is the manager, trustee and portfolio manager of the Existing Fund, and will be the manager of the Future Funds.
3. The Filer is registered under the securities legislation: (i) in British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, New Brunswick, Nova Scotia, and Newfoundland and Labrador as an adviser in the category of portfolio manager; (ii) in Ontario, Newfoundland and Labrador and Quebec as an investment fund manager; and (iii) in British Columbia, Alberta, Quebec, Saskatchewan, Manitoba, Ontario, New Brunswick, Nova Scotia, and Newfoundland and Labrador as a dealer in the category of exempt market dealer. The Filer is also registered in Ontario as a commodity trading manager.
4. The Filer is not in default of applicable securities legislation in any of the Jurisdictions.
The Funds
5. Each Fund is, or will be, an open-ended public mutual fund governed by NI 81-102.
6. Each Fund is, or will be, a mutual fund structured as a trust or a corporation or a class thereof that is governed by the laws of a Jurisdiction.
7. Each Fund is, or will be, a reporting issuer in the Jurisdictions in which its securities are distributed jurisdiction pursuant to disclosure documents filed under National Instrument 81-101 Mutual Fund Prospectus Disclosure (and/or National Instrument 41-101 General Prospectus Requirements in the case of the ETF Facts of a Fund).
8. The Existing Fund is not in default of applicable securities legislation in any of the Jurisdictions.
9. The Existing Fund's investment objectives are to maximize the total return of the Existing Fund and to provide income by investing primarily in debt and debt like securities of corporate and government issuers from around the world.
Short Selling Hedging Strategy
10. Since most of the investment portfolio of the Existing Fund consists of Canadian and U.S. corporate bonds, the value of the Existing Fund can change with fluctuating interest rates.
11. In order to hedge against interest rate risk in the investment portfolio of the Existing Fund, the Filer short sells highly liquid government fixed income securities at the same time that it invests in higher quality corporate fixed income securities in compliance with the 5% single issuer restriction in NI 81-102.
12. Paragraph 2.6.1(1)(c)(ii) of NI 81-102 restricts the Filer from short selling more than 5% of the NAV of a Fund in respect of any one issuer. As a result, a Fund is prevented from short selling Canadian, provincial and territorial government bonds by more than 5% of its NAV and similarly prevented from short selling U.S. government bonds by more than 5% of its NAV, resulting in the Fund only being able to hedge its interest rate exposure using this short selling strategy to a maximum of 10% of NAV.
13. The Filer is of the view that each Fund could benefit further from this hedging strategy if it were able to short sell "government securities" (as defined in NI 81-102) for hedging purposes in an amount greater than 5% of the Fund's NAV per issuer for the following reasons:
(a) The most effective interest rate hedge is where the government debt securities selected by the Filer most closely correlate to the underlying interest rate characteristics of the particular corporate fixed income securities held by a Fund and thus the Filer cannot remain within the 5% single issuer restriction by using different government debt securities and still achieve an optimal hedge for the Fund.
(b) The market for government securities is highly liquid and debt securities issued by the federal governments of Canada and the U.S. and the Canadian provinces and/or territories generally exhibit greater liquidity than high-quality corporate issues.
(c) While derivatives can be used to manage interest rate risk, the use of a derivatives hedging strategy is more inefficient, more complex, and risker than the Filer's strategy of short-selling government securities.
14. Each Fund implements the following controls when conducting a short sale:
(a) the Fund assumes the obligation to return to the Borrowing Agent (as defined in NI 81-102) the securities borrowed to effect the short sale;
(b) the Fund receives cash for the securities sold short within normal trading settlement periods for the market in which the short sale is effected;
(c) the Filer monitors the short positions of the Fund at least as frequently as daily;
(d) the security interest provided by the Fund over any of its assets that is required to enable the Fund to effect a short sale transaction is made in accordance with industry practice for that type of transaction and relates only to obligations arising under such short sale transactions;
(e) the Fund maintains appropriate internal controls regarding short sales, including written policies and procedures for the conduct of short sales, risk management controls and proper books and records; and
(f) the Filer and the Fund keep proper books and records of short sales and all of its assets deposited with Borrowing Agents as security.
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 provided that:
1. Each short sale made by each Fund will comply with all of the short sale requirements in section 2.6.1 of NI 81-102, other than the restriction that the aggregate market value of all securities of the issuer of the securities sold sort by the Fund does not exceed 5% of the NAV of the Fund.
2. The only securities which a Fund will sell short in an amount that exceeds 5% of the NAV of the Fund will be securities which meet the definition of "government security", being an evidence of indebtedness issued, or fully and unconditionally guaranteed as to principal and interest, by and of the government of Canada, the government of a Jurisdiction or the government of the United States of America.
3. Each short sale will be made consistent with the applicable Fund's investment objectives and investment strategies.
4. The simplified prospectus of each Fund will disclose, at the next renewal, that the Fund is able to short sell "government securities" (as defined in NI 81-102) for hedging purposes in an amount greater than 5% of the Fund's NAV per issuer.
Section 144(1) -- Application to vary a cease trade order -- cease trade order varied to permit beneficial shareholders, who are not insiders or control persons, to sell securities outside of Canada, subject to conditions.
Securities Act, R.S.O. 1990, c. S.5, as am., ss. 127 and 144.
WHEREAS the securities of the Issuer are subject to a temporary cease trade order issued by the Director on December 9, 2015 under paragraph 2 of subsection 127(1) and subsection 127(5) of the Act, as extended by a further cease trade order issued by the Director on December 21, 2015 pursuant to subsection 127(1) of the Act directing that trading in the securities of the Issuer, whether direct or indirect, cease until further order by the Director (the "Cease Trade Order");
AND WHEREAS a cease trade order with respect to the Issuer's securities was also issued by the British Columbia Securities Commission on December 8, 2015, the Alberta Securities Commission on December 4, 2015 and the Manitoba Securities Commission on December 7, 2015.
AND WHEREAS the Issuer's securities are not listed on and do not trade on any exchange in Canada;
AND WHEREAS a shareholder of the Issuer has made an application to the Commission pursuant to section 144(1) of the Act to vary the Cease Trade Order;
AND UPON the Director being satisfied that:
(a) the terms and conditions to the Cease Trade Order put Ontario resident shareholders of the Issuer at a disadvantage to certain shareholders who are free to trade their shares over a foreign market; and
(b) it is not prejudicial to the public interest to vary the Cease Trade Order under section 144(1) of the Act;
IT IS ORDERED that, pursuant to section 144(1) of the Act, the Cease Trade Order be varied by including the following section:
Despite this order, a beneficial shareholder of Iona Energy Inc. who is not, and was not as at December 9, 2015, an insider or control person of Iona Energy Inc., may sell securities of Iona Energy Inc. acquired before December 9, 2015, if:
1. the sale is made through a market outside of Canada; and
2. the sale is made through an investment dealer registered in Ontario.
DATED this 27 day of April, 2021
Application for an order that the issuer is not a reporting issuer under applicable securities laws -- requested relief granted.
Securities Act, R.S.O. 1990, c. S.5, as am., s. 1(10)(a)(ii).
June 29, 2021
The principal regulator in the Jurisdiction has received an application from the Filer for an order under the securities legislation of the Jurisdiction of the principal regulator (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 passport application):
(a) the Ontario Securities Commission is the principal regulator for this application; and
(b) the Filer has provided notice that subsection 4C.5(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in British Columbia, Alberta and Saskatchewan.
Terms defined in National Instrument 14-101 Definitions and MI 11-102 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 not an OTC reporting issuer under Multilateral Instrument 51-105 Issuers Quoted in the U.S. Over-the-Counter Markets;
2. the outstanding securities of the Filer, including debt securities, are beneficially owned, directly or indirectly, by fewer than 15 securityholders in each of the jurisdictions of Canada and fewer than 51 securityholders in total worldwide;
3. no securities of the Filer, including debt securities, are traded in Canada or another country on a marketplace as defined in National Instrument 21-101 Marketplace Operation or any other facility for bringing together buyers and sellers of securities where trading data is publicly reported;
4. the Filer is applying for an order that the Filer has ceased to be a reporting issuer in all of the jurisdictions of Canada in which it is a reporting issuer; and
5. the Filer is not in default of securities legislation in any jurisdiction.
The principal regulator is satisfied that the order meets the test set out in the Legislation for the principal regulator to make the order.
The decision of the principal regulator under the Legislation is that the Order Sought is granted.
National Policy 11-206 Process for Cease to be a Reporting Issuer Applications -- National Policy 11-207 Failure-to-File Cease Trade Orders and Revocations in Multiple Jurisdictions.
Securities Act, R.S.O. 1990, c. S.5, as am., s. 144.
May 31, 2021
Algold Resources Ltd. (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 Québec (the Principal Regulator) and Ontario (each a Decision Maker) on June 22, 2020.
The Issuer has applied to each of the Decision Makers under National Policy 11-207 Failure-to-File Cease Trade Orders and Revocations in Multiple Jurisdictions (NI 11-207) for an order of the FFCTO (FFCTO Revocation Order) to take effect as at the Effective Time (as defined below).
The FFCTO Revocation Order is the order of the Principal Regulator and evidences the decision of the Decision Maker in Ontario.
The Decision Makers in each of the Jurisdictions have also received an application (Cease to be a Reporting Issuer Application) from the Issuer for an order under the securities legislation of the Jurisdictions (the Legislation) that the Issuer has ceased to be a reporting issuer in all jurisdictions of Canada in which it is a reporting issuer (the Cease to be a Reporting Issuer Order) to take effect at the Effective Time.
Under the Process for Cease to be a Reporting Issuer Applications (for a dual application):
(a) the Autorité des marchés financiers of Québec is the principal regulator for this application;
(b) the Issuer has provided notice that subsection 4C.5(1) of Regulation 11-102 respecting Passport System (Regulation 11-102) is intended to be relied upon in Alberta, British Columbia, Saskatchewan, Manitoba, New Brunswick, Newfoundland and Labrador, Nova Scotia, Prince Edward Island, Northwest Territories, Nunavut and Yukon; and
(c) this order is the order of the Principal Regulator and evidences the decision of the securities regulatory authority in Ontario.
Terms defined in National Instrument 14-101 Definitions, NP 11-206 Process for Cease to be a Reporting Issuer (NP 11-206) and NP 11-207 have the same meanings if used in this Order, unless otherwise defined.
This decision is based upon the following facts represented by the Issuer:
1. The Issuer is a corporation existing under the Canada Business Corporations Act (CBCA) and its registered and principal office is in the Province of Québec.
2. The Issuer is a gold exploration company whose main asset is the Tijirit Permit in Mauritania.
3. The Issuer is authorized to issue an unlimited number of common shares (the Common Shares), of which 27,830,525 are issued and outstanding as at the date hereof.
4. The Issuer had no securities issued and outstanding immediately prior to the Effective Time;
5. The Common Shares of the Issuer are listed on the TSX Venture Exchange (TSXV) under the symbol ALG.
6. The Issuer is a reporting issuer in all provinces of Canada.
7. The FFCTO was issued on June 22, 2020 due to the failure of the Issuer to file (i) the annual financial statements and accompanying management's discussion and analysis for the financial year ended December 31, 2019; and (ii) the related CEO and CFO certifications (the Annual filings for the financial year ended December 31, 2019), and since the date of the FFCTO, the Issuer has not filed any further interim and annual filings required under applicable securities laws (collectively, the Required Filings).
8. The Issuer was unable to file the Annual filings for the financial year ended December 31, 2019, due to financial hardship resulting from the unprecedent challenges created by the COVID-19 pandemic and the conditions of the markets, with the consequence that the Issuer was unable to pay the fees of various service providers, including the auditors.
BIA proceedings
9. On January 15, 2021, the Issuer signed a Notice of intention to make a proposal (NOI) under the relevant provisions of the Bankruptcy and Insolvency Act (Canada) (BIA) and on January 15, 2021, Raymond Chabot Inc. filed the NOI with the Office of the Superintendent of Bankruptcy and was appointed trustee (the Trustee).
10. The Trustee filed under the BIA and submitted to the Issuer's creditors a Proposal and Plan of Reorganization under the relevant provisions of the BIA and of the CBCA pursuant to which, inter alia, all of the issued and outstanding Common Shares will be redeemed in consideration for shares of Aya Gold & Silver Inc. (Aya) with Aya becoming the sole shareholder of the Issuer.
11. Aya is a reporting issuer in British Columbia, Alberta, Ontario and Québec.
12. The common shares of Aya are listed on the Toronto Stock Exchange (TSX) under the symbol AYA.
13. On March 5, 2021, the creditors of the Issuer approved the Proposal (as defined below), which is conditional upon the completion of the Reorganization (as defined below).
14. The TSX has conditionally approved the issuance and listing of the Aya Reorganization Shares (as defined below) and of the Aya Proposal Shares (as defined below) while the TSXV has conditionally approved the Issuer's notice regarding the Reorganization (as defined below).
15. On March 26, 2021, an order (the Order) approving the Reorganization and the Proposal (as defined below) was issued by the Superior Court (Québec).
Reorganization
16. The Reorganization is to be made under section 191 of the CBCA and its principal steps that were approved by the Order include the following (the Reorganization):
a) creating an unlimited number of shares of a class designated as "Redeemable Shares" with the rights, privileges, restrictions and conditions described in articles of reorganization to be filed with Corporations Canada (the Articles of Reorganization);
b) changing the Common Shares into Redeemable Shares on the basis of one Redeemable Share for one Common Share;
c) redeeming all of the issued and outstanding Redeemable Shares in accordance with the Articles of Reorganization in consideration for the issuance of Aya Reorganization Shares (as described below);
d) declaring that, immediately after the redemption of all of the issued and outstanding Redeemable Shares in accordance with the Articles of Reorganization, the authorized (but non-issued) capital of the Issuer shall consist only of an unlimited number of common shares and the Redeemable Shares;
e) removing the authorized (but non-issued) common shares and Redeemable Shares as classes of shares and all rights, privileges, restrictions and conditions attaching thereto; and
f) creating an unlimited number of shares of a class designated as "Class A Common Shares" with the rights, privileges, restrictions and conditions attaching thereto as described in the Articles of Reorganization.
17. In connection with the Reorganization, Aya proposes to issue to the shareholders of the Issuer, as consideration for their respective Common Shares, an aggregate value of $2,400,000 in common shares from Aya's share capital (the "Aya Reorganization Shares"), calculated using the five-day volume weighted average price (the "5-day VWAP") of Aya's common shares during the five trading days immediately preceding the issuance, registration and delivery of the Aya Reorganization Shares.
18. The TSX has conditionally approved the issuance and listing of the Aya Reorganization Shares and of the Aya Proposal Shares (as defined below) while the TSX Venture Exchange has conditionally approved Issuer's notice regarding the Reorganization.
Proposal
19. The Proposal was made under sections 50, 59(4) and 66(1.4) of the BIA. Under the Proposal, Aya would issue to Issuer's creditors an aggregate value of $2,500,000 in common shares from Aya's share capital (the "Aya Proposal Shares"), calculated using the 5-day VWAP immediately before the issuance, registration and delivery of the Aya Proposal Shares. At the request of Revenu Québec, the proposal was later slightly amended before the Superior Court issued the Order (the "Proposal").
20. The Reorganization and Proposal are expected to close (Effective Time) on or around May 28, 2021.
21. As of the Effective Date, the Issuer will not be an OTC reporting issuer under Regulation 51-105 respecting Issuers Quoted in the U.S. Over-the-Counter Markets.
22. As of the Effective Date, no securities of the Issuer will be traded on a "marketplace" as defined in Regulation 21-101 respecting Marketplace Operation and there is currently no intention on the part of the shareholders, directors or officers of the Issuer to cause the Issuer to seek financing by way of a public offering of its securities in Canada or elsewhere.
23. The Reorganization cannot be completed without the Issuer obtaining the FFCTO revocation order.
24. After the Reorganization Aya will be the sole shareholder of the Issuer.
25. The Issuer is applying to cease to be a reporting issuer in all the jurisdictions of Canada in which it is a reporting issuer.
26. As a consequence of the Issuer being in default of securities legislation as evidenced by the FFCTO being in effect, the Issuer is not eligible to use the "simplified procedure" under NP 11-206.
27. In acting in compliance with the Order regarding the Reorganization, the Issuer may have engaged in certain acts in furtherance of trades in securities of the Issuer (Acts), which Acts were taken at the direction and with the approval of, and under the supervision of, the Court. Except for any Acts and the outstanding continuous disclosure filings the Issuer is not in default of any of the requirements of the FFCTO, the Legislation or the rules and regulations made pursuant thereto.
28. The Issuer acknowledges that, in granting the requested relief, the Decision Makers are not expressing any opinion or approval as to the terms of the Reorganization.
Each of the Decision Makers is satisfied that the order to revoke the FFCTO meets the test set out in the Legislation for the Decision Maker to make the decision.
The decision of the Decision Makers for the FFCTO Revocation Order under the Legislation is that the FFCTO Revocation Order is granted.
Each of the Decision Makers for the Cease to be a Reporting Issuer Order is satisfied that the test set out in the Legislation for the Decision Makers to make the Cease to be a Reporting Issuer Order is met.
The decision of the Decision Makers for the Cease to be a Reporting Issuer Order under the Legislation is that the Cease to be a Reporting Issuer Order is granted.
Mek Global Limited and PhoenixFin Pte. Ltd.
File No. 2021-18
July 6, 2021
WHEREAS on July 6, 2021, the Ontario Securities Commission held a hearing by teleconference;
ON HEARING the submissions of the representative for Staff of the Commission (Staff), no one appearing on behalf of Mek Global Limited or PhoenixFin Pte Ltd. (the Respondents), although properly served;
IT IS ORDERED THAT:
1. Staff shall disclose to the Respondents non-privileged relevant documents and things in the possession or control of Staff, by 4:30 p.m. on August 5, 2021;
2. the Respondents shall serve and file a motion, if any, regarding Staff's disclosure or seeking disclosure of additional documents, by 4:30 p.m. on September 30, 2021;
3. Staff shall serve and file a witness list, and serve a summary of each witness' anticipated evidence on the Respondents, and indicate any intention to call an expert witness, including providing the expert's name and the issues on which the expert will give evidence, by 4:30 p.m. on October 8, 2021; and
4. a further attendance in this matter is scheduled for October 14, 2021 at 10:00 a.m., by teleconference, or on such other date and time as may be agreed to by the parties and set by the Office of the Secretary.
Temporary, Permanent & Rescinding Issuer Cease Trading Orders
Company Name |
Date of Temporary Order |
Date of Hearing |
Date of Permanent Order |
Date of Lapse/Revoke |
|
||||
THERE IS NOTHING TO REPORT THIS WEEK. |
||||
Company Name |
Date of Order |
Date of Revocation |
|
||
THERE IS NOTHING TO REPORT THIS WEEK. |
||
Temporary, Permanent & Rescinding Management Cease Trading Orders
Company Name |
Date of Order |
Date of Lapse |
|
||
Flower One Holdings Inc. |
May 3, 2021 |
June 30, 2021 |
|
||
Nass Valley Gateway Ltd. |
May 5, 2021 |
July 2, 2021 |
|
||
Rapid Dose Therapeutics Corp. |
June 29, 2021 |
__________ |
|
||
Sproutly Canada, Inc. |
June 30, 2021 |
__________ |
|
||
Tree of Knowledge International Corp. |
May 3, 2021 |
July 5, 2021 |
|
||
WeedMD Inc. |
May 3, 2021 |
July 2, 2021 |
Outstanding Management & Insider Cease Trading Orders
Company Name |
Date of Order or Temporary Order |
Date of Hearing |
Date of Permanent Order |
Date of Lapse/Expire |
Date of Issuer Temporary Order |
|
|||||
Performance Sports Group Ltd. |
19 October 2016 |
31 October 2016 |
31 October 2016 |
__________ |
__________ |
Company Name |
Date of Order |
Date of Lapse |
|
||
Agrios Global Holdings Ltd. |
September 17, 2020 |
__________ |
|
||
Bhang Inc. |
May 3, 2021 |
__________ |
|
||
Flower One Holdings Inc. |
May 3, 2021 |
June 30, 2021 |
|
||
Ionic Brands Corp. |
May 3, 2021 |
__________ |
|
||
King Global Ventures Inc. |
May 3, 2021 |
__________ |
|
||
Tree of Knowledge International Corp. |
May 3, 2021 |
July 5, 2021 |
|
||
WeedMD Inc. |
May 3, 2021 |
July 2, 2021 |
|
||
Empower Clinics Inc. |
May 4, 2021 |
__________ |
|
||
Red White & Bloom Brands Inc. |
May 4, 2021 |
__________ |
|
||
Reservoir Capital Corp. |
May 5, 2021 |
__________ |
|
||
Nass Valley Gateway Ltd. |
May 5, 2021 |
July 2, 2021 |
|
||
Ionic Brands Corp. |
June 3, 2021 |
__________ |
|
||
Rapid Dose Therapeutics Corp. |
June 29, 2021 |
__________ |
|
||
Sproutly Canada, Inc. |
June 30, 2021 |
__________ |
Issuer Name:
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Type |
Company |
Category of Registration |
Effective Date |
|
|||
New Registration |
Stormont Partners Securities Inc. |
Exempt Market Dealer |
June 30, 2021 |
|
|||
New Registration |
Greenfield Investment Management Limited |
Portfolio Manager |
July 2, 2021 |
|
|||
New Registration |
Ginsler Wealth Management Inc. |
Portfolio Manager And Exempt Market Dealer |
July 2, 2021 |
|
|||
Change in Registration Category |
Brandywine Global Investment Management (Canada), ULC |
From: Portfolio Manager, Exempt Market Dealer, Investment Fund Manager and Commodity Trading Manager |
July 2, 2021 |
|
|||
To: Commodity Trading Manager |
|||
|
|||
Change in Registration Category |
Redjay Asset Management Inc. |
From: Portfolio Manager and Exempt Market Dealer |
July 5, 2021 |
|
|||
To: Investment Fund Manager, Portfolio Manager and Exempt Market Dealer |
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Investment Industry Regulatory Organization of Canada (IIROC) -- Proposed Amendments to the IIROC Rules and Form 1 relating to the Futures Segregation and Portability Customer Protection Regime -- Request for Comment
IIROC is publishing for public comment proposed amendments to IIROC Rules and Form 1 relating to the futures segregation and portability customer protection regime (collectively, the Proposed Amendments). The Proposed Amendments are required to align IIROC's requirements with expected rule changes at the Canadian Derivatives Clearing Corporation (CDCC). CDCC is proposing a new customer protection segregation and portability (Seg and Port) regime to comply with international standards. The new Seg and Port regime introduces another customer protection model that is separate from the Canadian Investor Protection Fund (CIPF) customer protection model, and therefore requires corresponding operational and reporting separation to address the two models.
The objective of the Proposed Amendments is to ensure that both the existing CIPF customer protection regime and the new Seg and Port regime can provide their protections without significant impacts to clients.
A copy of the IIROC Notice, including the Proposed Amendments, is also published on our website at www.osc.ca. The comment period ends on September 7, 2021.
Canadian Derivatives Clearing Corporation (CDCC) -- Proposed Amendments to the Rules, Operations Manual, Risk Manual and Default Manual of CDCC to Introduce the Gross Client Margin (GCM) Model -- OSC Staff Notice of Request for Comment
The Ontario Securities Commission is publishing for public comment the proposed amendments to the CDCC Rules, Operations Manual, Risk Manual and Default Manual to introduce the GCM Model.
The purpose of the proposed amendments is to support the implementation of the GCM regime and the enhancements of CDCC's porting arrangements under this regime to comply with Principal 14 "Segregation and Portability" of the Principles for Financial Market Infrastructures (PFMI) published in 2012 by CPMI-IOSCO.
The comment period ends on September 03, 2021.
A copy of the CDCC Notice is published on our website at http://www.osc.ca.
Bullet Exploration Inc. -- s. 4(b) of the Regulation
Consent given to an offering corporation under the Business Corporations Act (Ontario) to continue under the Business Corporations Act (British Columbia).
Business Corporations Act, R.S.O. 1990, c. B.16, as am., s. 181.
Securities Act, R.S.O. 1990, c. S.5, as am.
Regulation made under the Business Corporations Act, Ont. Reg. 289/00, as am., s. 4(b).
UPON the application of Bullet Exploration Inc. (formerly CHC Student Housing Corp.) (the Applicant) to the Ontario Securities Commission (the Commission) requesting a consent from the Commission, as required under subsection 4(b) of the Regulation, for the Applicant to continue into the province of British Columbia pursuant to section 181 of the OBCA;
AND UPON considering the application and the recommendation of the staff of the Commission;
AND UPON the Applicant having represented to the Commission that:
1. The Applicant is an offering corporation under the OBCA.
2. The Applicant was incorporated under the OBCA as CHC Realty Capital Corp. pursuant to a Certificate of Incorporation dated April 12, 2013. On February 19, 2015, the Applicant changed its name from CHC Realty Capital Corp. to CHC Student Housing Corp. On October 1, 2020, the Applicant was amalgamated with its subsidiaries and continued as CHC Student Housing Corp. In connection with the Transaction (as defined below), the Applicant's name was changed to Bullet Exploration Inc. on March 25, 2021.
3. The Applicant's registered office is located at 1 First Canadian Place, 100 King Street West, Suite 6000, Toronto, Ontario M5X 1E2.
4. The Applicant's common shares (the Common Shares) are listed and posted for trading on the TSX Venture Exchange (the Exchange) under the symbol "AMMO"
5. The authorized share capital of the Applicant consists of an unlimited number of Common Shares. As at March 26, 2021, the Applicant had 18,716,465 Common Shares issued and outstanding.
6. The Applicant intends to apply (the Application for Continuance) to the Director (as defined in the OBCA) for authorization to continue as a corporation under the Business Corporations Act (British Columbia), S.B.C., 2002, c. 57, as amended (the BCBCA) pursuant to section 181 of the OBCA.
7. Pursuant to subsection 4(b) of the Regulation, where a corporation is an "offering corporation" (as defined in the OBCA), the Application for Continuance must be accompanied by a consent from the Commission.
8. The Applicant is a reporting issuer under the Securities Act, R.S.O. 1990, c. S. 5, as amended (the Act), the Securities Act, R.S.B.C. 1996, c. 418 (the BC Act) and the Securities Act, R.S.A. 2000, C. S-4, as amended (the Alberta Act and together with the Act and the BC Act, the Legislation) and will remain a reporting issuer in these jurisdictions following the proposed Continuance.
9. The Applicant is not in default under any provision of the OBCA or the Legislation, including any of the regulations or rules made thereunder.
10. The Applicant is not a party to any proceeding or, to the best of its knowledge, information and belief, any pending proceeding under the OBCA or the Legislation.
11. The Application for Continuance is being made in connection with the reverse takeover transaction (the Transaction) completed on March 26, 2021 involving the Applicant, 2294253 Alberta Ltd., a corporation incorporated under the Business Corporations Act (Alberta) (Target Company) and the Target Company's shareholders, pursuant to which the Applicant acquired all of the issued and outstanding shares of the Target Company and the Target Company shareholders received shares of the Applicant.
12. The Applicant's management information circular dated December 8, 2020 for its annual general and special meeting of shareholders, held on January 6, 2021 (the Shareholders Meeting) described the proposed Continuance, disclosed the reasons for, and the implications of, the proposed Continuance. It also disclosed full particulars of the dissent rights of the Applicant's shareholders under section 185 of the OBCA and included a summary comparison of the differences between the OBCA and the BCBCA.
13. The Applicant's shareholders approved the Continuance at the Shareholders Meeting by a special resolution. The special resolution authorizing the Continuance was approved by 79.47% of the votes cast. No shareholder exercised dissent rights pursuant to section 185 of the OBCA.
14. The Commission is the principal regulator of the Applicant.
15. The Applicant's registered office is currently in Ontario and its head office is in Alberta. Following the proposed Continuance, the Applicant's registered office will be moved to British Columbia. The Applicant intends to have the Alberta Securities Commission be its principal regulator.
16. In connection with the Transaction, the Applicant is expected to complete the Continuance under the BCBCA. The Continuance is being proposed by the Applicant as it believes that the BCBCA provides additional flexibility compared to the OBCA, including with respect to the composition of the Applicant's board of directors going forward. This will allow the Applicant's board of directors to consider candidates for the Applicant's board of directors from a larger pool of candidates that includes candidates from outside of Canada in order to have the right composition, skills, expertise and diversity to drive long-term value.
17. The material rights, duties and obligations of a corporation governed by the BCBCA are substantially similar to those of a corporation governed by the OBCA.
AND UPON the Commission being satisfied that to do so would not be prejudicial to the public interest;
THE COMMISSION HEREBY CONSENTS to the Continuance of the Applicant under the BCBCA.
DATED at Toronto, Ontario this 21st day of April, 2021.
"Lawrence Haber" |
"Craig Hayman" |
Commissioner |
Commissioner |
Ontario Securities Commission |
Ontario Securities Commission |
OSC File #: 2021/0179 |
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