Securities Law & Instruments

Headnote

Section 147 of the Act - issuer is exempt fromthe payment of the fee otherwise payable under section 7.3 ofRule 45-501 in connection with a dual structure transaction.

Statutes Cited

Securities Act, R.S.O. 1990, c. S.5, as am.,s. 147.

Regulations Cited

Regulation made under the Securities Act, R.R.O.1990, Reg. 1015, as am., subsection 18(1) of Schedule I.

Rules Cited

Ontario Securities Commission Rule 45-501 -Exempt Distributions, s. 7.3.

IN THE MATTER OF

THE SECURITIES ACT

R.S.O. 1990, CHAPTER S.5,AS AMENDED (the "Act")

AND

IN THE MATTER OF

1020078 ALBERTA LTD.

 

ORDER

(Section 147)

WHEREAS the Ontario Securities Commission(the "Commission") has received an application onbehalf of 1020078 Alberta Ltd. ("102 Alberta" or the"Applicant") for an order under section 147 of theSecurities Act (Ontario) (the "Act") exempting102 Alberta from the payment of duplicative fees otherwise payableunder section 7.3 of Rule 45-501 of the Commission ("Rule45-501") in connection with certain trades by 102 Albertato Ontario Teachers' Pension Plan Board ("Teachers'")and BPC Penco Corporation ("BPC"), as described below.

AND WHEREAS the Applicant has representedto the Commission that:

1. 102 Alberta is an Alberta corporation thatis a wholly-owned subsidiary of BC Gas Inc.

2. 102 Alberta is not a reporting issuer inany jurisdiction and is not in default of any requirementof the securities acts or regulations applicable in each ofthe provinces of Canada.

3. Express LP is a Delaware limited partnership.

4. Under a series of transactions, all ofwhich occurred on January 9, 2003, Teachers' invested $142,000,000in the aggregate in Express LP, consisting of 4,000 ordinaryunits issued to Teachers' by Express LP for $28,400,000 andan interest bearing debenture of Express LP with a principalamount of $113,600,000 transferred to Teachers' by 102 Alberta.

5. The acquisition by Teachers' of the securitiesof Express LP described in paragraph 4 occurred as follows:

(a) on January 9, 2003, 102 Alberta transferredto Teachers', in satisfaction of a loan by Teachers' to102 Alberta in the principal amount of $142,000,000:

(i) a non-interest bearing demand promissorynote in the principal amount of $28,400,000 issued to102 Alberta by Express LP (the "Teachers' Note");and

(ii) an unsecured subordinated debenturein the principal amount of $113,600,000 issued to 102Alberta by Express LP (the "Teachers' Debenture");and

(b) subsequently, on January 9, 2003, ExpressLP issued 4,000 ordinary units for an aggregate cost of$28,400,000 to Teachers' (the "Teachers' Units")in satisfaction of the Teachers' Note.

6. The trades from 102 Alberta of the Teachers'Note and the Teachers' Debenture and the issuance by ExpressLP of the Teachers' Units to Teachers' were made in relianceon the prospectus and registration exemptions under section2.3 of Rule 45-501.

7. 102 Alberta has filed a Form 45-501F1 inconnection with the transfer by 102 Alberta to Teachers' ofthe Teachers' Debenture and has paid fees totalling $18,176under section 7.3 of Rule 45-501.

8. Express LP has filed a Form 45-501F1 inconnection with the issuance of the Teachers' Units to Teachers'and has paid fees totalling $4,544 under section 7.3 of Rule45-501.

9. In connection with the transfer to Teachers'of the Teachers' Note, 102 Alberta has filed a Form 45-501F1and has deposited a cheque with the Commission for the requiredfees, with the request that the cheque be either returnedto 102 Alberta or cashed by the Commission, according to theoutcome of this application.

10. Under a series of transactions, all ofwhich occurred on January 9, 2003, BPC invested $142,000,000in the aggregate in Express LP, consisting of 4,000 ordinaryunits issued to BPC by Express LP for $28,400,000 and an interestbearing debenture of Express LP with a principal amount of$113,600,000 transferred to BPC by 102 Alberta.

11. The acquisition by BPC of the securitiesof Express LP described in paragraph 10 occurred as follows:

(a) on January 9, 2003, 102 Alberta transferredto BPC, in satisfaction of a loan by BPC to 102 Albertain the principal amount of $142,000,000:

(i) a non-interest bearing demand promissorynote in the principal amount of $28,400,000 issued to102 Alberta by Express LP (the "BPC Note");and

(ii) an unsecured subordinated debenturein the principal amount of $113,600,000 issued to 102Alberta by Express LP (the "BPC Debenture"); and

(b) subsequently, on January 9, 2003, ExpressLP issued 4,000 ordinary units for an aggregate cost of$28,400,000 to BPC (the "BPC Units") insatisfaction of the BPC Note.

12. The trades from 102 Alberta of the BPCNote and the BPC Debenture and the issuance by Express LPof the BPC Units to BPC were made in reliance on the prospectusand registration exemptions under section 2.3 of Rule 45-501.

13. 102 Alberta has filed a Form 45-501F1in connection with the trade by 102 Alberta to BPC of theBPC Debenture and has paid fees totalling $18,176 under section7.3 of Rule 45-501.

14. Express LP has filed a Form 45-501F1 inconnection with the issuance of the BPC Units to BPC and haspaid fees totalling $4,544 under section 7.3 of Rule 45-501.

15. In connection with the transfer to BPCof the BPC Note, 102 Alberta has filed a Form 45-501F1 andhas deposited a cheque with the Commission for the requiredfees, with the request that the cheque be either returnedto 102 Alberta or cashed by the Commission, according to theoutcome of this application.

AND WHEREAS this Order evidences thedecision of the Commission;

AND WHEREAS the Commission is of theopinion that it would not be prejudicial to the public interestto make this Order;

IT IS ORDERED, under section 147 of theAct, that the Applicant is exempt from the requirement to paythe fees otherwise payable under section 7.3 of Rule 45-501in connection with the transfer of the Teachers' Note by theApplicant to Teachers' and in connection with the transfer ofthe BPC Note by the Applicant to BPC.

February 21, 2003.

"Robert W. Korthals"                    "RobertL. Shirriff"