Securities Law & Instruments

Headnote

National Policy 11-203 Process For Exemptive Relief Applications in Multiple Jurisdictions -- National Instrument 51-101 Standards of Disclosure for Oil and Gas Activities -- Exemption for all the requirements of NI 51-101 granted to a reporting issuer that has obtained relief from certain continuous disclosure requirements (similar to credit support issuer -- as defined in subsection 13.4(1) of National Instrument 51-102 Continuous Disclosure Obligations) and meets the requirements and conditions set out in the prior relief -- Relief from NI 51-101 is on condition that the issuer is in compliance with the requirements and conditions set out in the prior relief as modified by this decision document.

Applicable Legislative Provisions

National Instrument 51-101 Standards of Disclosure for Oil and Gas Activities, s. 8.1(1).

May 1, 2009

IN THE MATTER OF

THE SECURITIES LEGISLATION OF

ALBERTA AND ONTARIO

(the Jurisdictions)

AND

IN THE MATTER OF

THE PROCESS FOR EXEMPTIVE RELIEF

APPLICATIONS IN MULTIPLE JURISDICTIONS

AND

IN THE MATTER OF

BARRICK ENERGY INC. (Barrick Energy) AND

BARRICK GOLD CORPORATION

(Barrick and, together with Barrick Energy,

the Filers)

 

DECISION

Background

The securities regulatory authority or regulator in each of the Jurisdictions (Decision Maker) has received an application from the Filers for a decision under the securities legislation of the Jurisdictions (the Legislation) that Barrick Energy, formerly known as Cadence Energy Inc. (Cadence), be exempt (the Exemption Sought) from the requirements of National Instrument 51-101 Standards of Disclosure for Oil and Gas Activities (NI 51-101).

Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a dual application):

(a) the Alberta Securities Commission is the principal regulator for this application,

(b) the Filers have provided notice that Section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in the provinces of British Columbia, Alberta, Saskatchewan, Manitoba, Québec, New Brunswick, Nova Scotia, Prince Edward Island and Newfoundland and Labrador, and

(c) the decision is the decision of the Principal Regulator and evidences the decision of the securities regulatory authority or regulator in Ontario.

Interpretation

Terms defined in National Instrument 14-101 Definitions and MI 11-102 have the same meaning if used in this decision, unless otherwise defined.

Representations

The decision is based on the following facts represented by the Filers:

1. Barrick is a corporation existing under the Business Corporations Act (Ontario). Barrick's common shares are listed on the Toronto Stock Exchange (the TSX) and on the New York Stock Exchange under the symbol "ABX".

2. Barrick is a reporting issuer in each of the provinces and territories of Canada and is not on the lists of defaulting reporting issuers maintained pursuant to the legislation of any such jurisdiction.

3. Barrick Energy is a corporation existing under the Business Corporations Act (Alberta). Barrick Energy's head office is located in Calgary, Alberta.

4. Barrick Energy's 4.75% convertible unsecured subordinated debentures due June 30, 2012 (the Convertible Debentures) are listed on the TSX.

5. Barrick Energy is a reporting issuer in each of the provinces of Canada and is not on the lists of defaulting reporting issuers maintained pursuant to the legislation of any such jurisdiction.

6. On July 30, 2008, Barrick, through its wholly-owned subsidiary, Cadence Acquisition Inc. (Cadence Acquisition), made an offer to acquire all of the issued and outstanding common shares in the capital of Cadence (the Cadence Shares). On September 4, 2008, Barrick took up and paid for Cadence Shares representing approximately 96.6% of the issued and outstanding Cadence Shares.

7. On November 10, 2008, Cadence and 1426384 Alberta Ltd., a wholly-owned subsidiary of Cadence Acquisition, were amalgamated (the First Amalgamation) under the Business Corporations Act (Alberta) to continue as a single corporation named "Cadence Energy Inc." As a result of the First Amalgamation, the common shares in the capital of Cadence (other than those held by Cadence Acquisition) were converted into preferred shares of the post-amalgamation company (Amalco) that were redeemed in accordance with their terms on November 12, 2008 for a redemption price of $6.75 cash per share. Amalco changed its name on November 12, 2008 to Barrick Energy Inc.

8. After the First Amalgamation, Amalco was a party to two additional amalgamations with wholly-owned direct or indirect subsidiaries of Barrick, with the resulting corporation being named "Barrick Energy Inc."

9. Barrick Energy's outstanding capital is currently comprised of:

(a) common shares (Barrick Energy Shares), all of which are held by Barrick;

(b) the Convertible Debentures, which are now convertible into common shares of Barrick; and

(c) two classes of warrants comprised of warrants expiring on May 26, 2009 (the 2009 Warrants) and warrants expiring on June 21, 2010 (the 2010 Warrants and, together with the 2009 Warrants, the Warrants), each of which now entitles the holders to acquire $6.75 cash in lieu of each Cadence Share to which the holders of such Warrants were previously entitled upon exercise.

10. Neither the Convertible Debentures nor the Warrants are convertible into or exercisable for Barrick Energy Shares.

11. Barrick has fully and unconditionally guaranteed (the Barrick Guarantees) all of Barrick Energy's payment obligations in connection with the Convertible Debentures and the Warrants. The Barrick Guarantees entitle the holders of the Convertible Debentures or the Warrants, as the case may be, to receive payment from Barrick within 15 days of any failure by Barrick Energy to make a payment in accordance with the terms of the Convertible Debentures or the applicable Warrants, as the case may be.

12. The Convertible Debentures are "designated credit support securities", as defined in Section 13.4(1) of National Instrument 51-102 Continuous Disclosure Obligations (NI 51-102).

13. On October 29, 2008, the Principal Regulator and the OSC granted an order (the Prior Order) that exempted Cadence or its insiders, as the case may be, from NI 51-102, Multilateral Instrument 52-109 Certification of Disclosure in Issuers' Annual and Interim Filings, Multilateral Instrument 52-110 Audit Committees, National Instrument 55-102 System for Electronic Disclosure by Insiders and National Instrument 58-101 Disclosure of Corporate Governance Practices, provided that, among other things, the Filers continue to satisfy all the conditions set forth in subsection 13.4(2) of NI 51-102, other than paragraph 13.4(2)(c) of NI 51-102.

14. Notwithstanding the Prior Order, absent the Exemption Sought, NI 51-101 would apply to Barrick Energy.

15. Any oil and gas information publicly disclosed by Barrick Energy that is not material in respect of Barrick would not be likely to influence the decision of a reasonable security holder to buy, sell or hold the Warrants or designated credit support securities of Barrick Energy.

Decision

Each of the Decision Makers is satisfied that the decision meets the test set out in the Legislation for the Decision Maker to make the decision.

The decision of the Decision Makers under the Legislation is that the Exemption Sought is granted provided that:

(a) Barrick Energy complies with the requirements and conditions set out in the Prior Order; and

(b) for the purposes of determining the Filers' compliance with Section 13.4(2) of NI 51-102, the reference to "continuous disclosure documents" in Section 13.4(2)(d)(ii)(A) of NI 51-102 and the reference to "documents" in Section 13.4(2)(d)(ii)(B) of NI 51-102 includes any documents filed by Barrick in accordance with NI 51-101.

"Blaine Young"
Associate Director, Corporate Finance