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Kinross Gold Corporation - MRRS Decision
Headnote
MRRS - issuer must prepare aninformation circular and possibly a short-form prospectus inconnection with a merger of 3 producing gold issuers - issuerable to rely upon grand-fathering provision in ss. 4.2(1)2 forits own technical disclosure in a short-form prospectus - mergerpartners recently completed their own short-form offerings inreliance upon grand-fathering provisions contained in ss. 4.2(1)2- no new material technical information to be disclosed - issuerpreparing information circular and short-form prospectus inconnection with merger exempt from requirement to file a technicalreport in connection with technical disclosure about mergerpartners contained in the information circular and short-formprospectus.
Rules Cited
National Instrument 43-101 -Standards of Disclosure for Mineral Projects, ss. 4.2(1)2, 4.2(1)3,and 9.1(1).
IN THE MATTER OF
THE SECURITIES LEGISLATIONOF
ALBERTA, BRITISH COLUMBIA,MANITOBA, NEW BRUNSWICK,
NEWFOUNDLAND AND LABRADOR,NOVA SCOTIA, ONTARIO,
PRINCE EDWARD ISLAND, QUEBECAND SASKATCHEWAN
AND
IN THE MATTER OF
THE MUTUAL RELIANCE REVIEWSYSTEM
FOR EXEMPTIVE RELIEF APPLICATIONS
AND
IN THE MATTER OF
KINROSS GOLD CORPORATION
MRRS DECISION DOCUMENT
WHEREAS the local securitiesregulatory authority or regulator (the "Decision Maker",and collectively, the "Decision Makers") in each ofAlberta, British Columbia, Manitoba, New Brunswick, Newfoundlandand Labrador, Nova Scotia, Ontario, Prince Edward Island, Quebecand Saskatchewan (the "Jurisdictions") has receivedan application (the "Application") from Kinross GoldCorporation (the "Filer") for a decision under section9.1 of National Instrument 43-101 Standards of Disclosurefor Mineral Projects ("NI 43-101") that the Fileris exempt from the requirements to file current technical reports(the "Reports") contained in paragraphs 4.2(1)2 and4.2 (1)3 of NI 43-101 (the "Technical Report Filing Requirements")in connection with a preliminary short form prospectus and amanagement information circular;
AND WHEREAS under theMutual Reliance Review System for Exemptive Relief Applications(the "System"), Ontario is the principal jurisdictionfor this application;
AND WHEREAS the Filerhas represented to the Decision Makers that:
1. The Filer is a continuingcorporation under the Business Corporations Act (Ontario)resulting from various amalgamations commencing in 1993. TheFiler's principal place of business is located in Toronto,Ontario.
2. The Filer is a reportingissuer in each of the Jurisdictions and is qualified to filea prospectus in the form of a short form prospectus underNational Instrument 44-101 Short Form Prospectus Distributions("NI 44-101").
3. The authorized capitalof the Filer consists of an unlimited number of common sharesand 384,613 redeemable retractable preferred shares, of which358,208,419 common shares and 384,613 preferred shares wereissued and outstanding as of May 31, 2002. The Filer has alsoissued convertible debentures in the aggregate principal amountof $195,586.
4. The common shares of theFiler are listed and posted for trading on the Toronto StockExchange and the American Stock Exchange, and the convertibledebentures of the Filer are listed and posted for tradingon the Toronto Stock Exchange.
5. The Filer is engaged inthe mining and processing of gold and silver ore and in theexploration for and acquisition and development of gold bearingproperties, principally in Canada, the United States, Russia,Chile and Zimbabwe.
6. The Filer entered intoan agreement on June 10, 2002 respecting: (a) the combinationof the ownership of the businesses of the Filer, TVX GoldInc. ("TVX") and Echo Bay Mines Ltd. ("EchoBay") (the "Combination"), such that upon thecompletion of the Combination the Filer will own all of theoutstanding common shares of TVX and Echo Bay; and (b) theacquisition by TVX of the interest of Newmont Mining Corporation("Newmont") in the TVX Newmont Americas joint venturethat Newmont is engaged in with TVX (the "Newmont Purchase").
7. TVX was originally incorporatedunder the laws of British Columbia in February 1980, was continuedunder the laws of Ontario on October 31, 1984 and was continuedunder the Canada Business Corporations Act on January7, 1991.
8. TVX is a reporting issuerin each of the Jurisdictions and the territories of Canada,and is qualified to file a prospectus in the form of a shortform prospectus under NI 44-101.
9. The authorized capitalof TVX consists of an unlimited number of common shares, ofwhich 429,073,530 common shares were issued and outstandingas of May 31, 2002.
10. The common shares of TVXare listed and posted for trading on the Toronto Stock Exchangeand the New York Stock Exchange.
11. TVX is principally engagedin the acquisition, financing, exploration, development andoperation of precious and base mining properties, and holdsinterests in operating mines located in Canada, Brazil, Chileand Greece as well as interests in other exploration and developmentproperties.
12. Echo Bay was originallyincorporated in Canada in 1964, and was continued under theCanada Business Corporations Act on October 10, 1980.
13. Echo Bay is a reportingissuer in each of the Jurisdictions and the territories ofCanada, and is qualified to file a prospectus in the formof a short form prospectus under NI 44-101.
14. The authorized capitalof Echo Bay consists of an unlimited number of common sharesand an unlimited number of preferred shares, of which 541,268,375common shares and no preferred shares were issued and outstandingas of May 31, 2002. The Filer currently holds 57,126,674 commonshares of Echo Bay, representing approximately 9.5% of EchoBay's issued and outstanding common shares.
15. The common shares of EchoBay are listed and posted for trading on the Toronto StockExchange and the American Stock Exchange, as well as exchangesin France, Belgium, Switzerland and Germany.
16. Echo Bay is a North Americangold mining company which mines, processes and explores forgold, and operates three mines in Canada and the United States.
17. Upon the completion ofthe Combination, the Filer will indirectly own interests invarious mining properties, including the interests of TVXand Newmont in four material mining properties (the "TVXMining Properties") and the interest of Echo Bay in onematerial mining property (the "Echo Bay Mining Property")(the TVX Mining Properties and the Echo Bay Mining Propertyare collectively referred to as the "Combination MiningProperties").
18. Subsequent to enteringinto the agreement in respect of the Combination, the Filerexpects to: (a) file, as soon as possible, a preliminary shortform prospectus or a preliminary base shelf prospectus pursuantto National Instrument 44-102 Shelf Distributions (the"Prospectus"), with a portion of the proceeds raisedbeing allocated to the Newmont Purchase; and (b) issue, assoon as practicable, a management information circular (the"Circular") wherein the Filer will request, amongother things, shareholder approval for the Combination.
19. The Combination constitutesa "significant probable acquisition" for purposesof NI 44-101 and accordingly the Filer is obligated to includein the Prospectus certain historical financial and operatinginformation concerning TVX and Echo Bay.
20. Pursuant to the securitieslegislation of the Jurisdictions, the Circular must includedisclosure that would be required in a prospectus as if theCircular were a prospectus of each of the Filer, TVX and EchoBay.
21. The Prospectus and theCircular will each incorporate by reference or include informationderived from documents filed by each of TVX and Echo Bay withsecurities regulators in Canada, including their recent annualinformation form/annual report on Form 10-K (as applicable),management's discussion and analysis of financial conditionand results of operations, audited consolidated annual financialstatements, management information circulars and materialchange reports.
22. NI 43-101 requires anissuer to file a current Report to support material informationcontained in a short form prospectus, describing mineral projectson a property material to the issuer unless that informationwas contained in: (a) a disclosure document filed before February1, 2001; (b) a previously filed Report; or (c) a report preparedin accordance with National Policy Statement No. 2-A and filedwith a regulator before February 1, 2001 (the foregoing exceptionsare referred to in this application as the "GrandfatherProvisions").
23. NI 43-101 also requiresa Report to be filed by an issuer to support information inan information circular concerning the acquisition of a materialproperty.
24. Material information concerningthe Filer's mining projects on its material properties (the"Filer's Mining Properties") has been containedin previously filed disclosure documents.
25. Since February 1, 2001,no new material information exists concerning material projectson the Filer's Mining Properties and its continuous disclosurerecord complies with NI 43-101.
26. Upon the filing of theProspectus, the Filer will not be required to file currentReports in respect of the Filer's Mining Properties in relianceon the Grandfather Provisions.
27. The Filer has been advisedby TVX and by Echo Bay that in connection with short formprospectuses and annual information forms recently filed byeach of them, they have each relied on the Grandfather Provisionsin not filing current Reports in respect of their applicableCombination Mining Properties.
28. The Filer has been advisedby TVX and by Echo Bay that since February 1, 2001, no newmaterial information exists concerning material projects ontheir respective Combination Mining Properties and that theirrespective continuous disclosure records comply with NI 43-101.
AND WHEREAS pursuantto the System, this MRRS Decision Document evidences the decisionof each Decision Maker (collectively, the "Decision");
AND WHEREAS each of theDecision Makers is satisfied that the test contained in thesecurities legislation of the Jurisdictions that provides theDecision Maker with the jurisdiction to make the Decision hasbeen met;
THE DECISION of the DecisionMakers pursuant to sub-section 9.1(1) of NI 43-101 is that theFiler is exempt from the Technical Report Filing Requirementsin connection with information about the Combination MiningProperties contained in the Prospectus and the Circular thatTVX and Echo Bay previously disclosed pursuant to the GrandfatherProvisions.
June 17, 2002.
"Margo Paul"