Securities Law & Instruments

Headnote

Mutual Reliance Review System for ExemptiveRelief Applications - Decision declaring corporation to be nolonger a reporting issuer following the acquisition of all ofits outstanding securities by another issuer.

Applicable Ontario Statutory Provisions

Securities Act, R.S.O. 1990, c. S.5, as am.,s. 83.

IN THE MATTER OF

THE SECURITIES LEGISLATIONOF

ALBERTA, ONTARIO AND QUEBEC

AND

IN THE MATTER OF

THE MUTUAL RELIANCE REVIEWSYSTEM

FOR EXEMPTIVE RELIEF APPLICATIONS

AND

IN THE MATTER OF

VIKING KEYWEST INC.

(FORMERLY KEYWEST ENERGY CORPORATION)

 

MRRS DECISION DOCUMENT

WHEREAS the local securities regulatoryauthority or regulator (the Decision Maker) in each of the provincesof Alberta, Ontario and Quebec (the Jurisdictions) has receivedan application from Viking KeyWest Inc. (Viking KeyWest) (formerlyKeyWest Energy Corporation) (KeyWest) for a decision pursuantto the securities legislation of the Jurisdictions (the Legislation)that Viking KeyWest be deemed to have ceased to be a reportingissuer or equivalent under the Legislation;

AND WHEREAS pursuant to the Mutual RelianceReview System for Exemptive Relief Applications (the System)the Alberta Securities Commission is the principal regulatorfor this application;

AND WHEREAS, unless otherwise defined,the terms herein have the meaning set out in National Instrument14-101 Definitions or in Québec Commission Notice 14-101;

AND WHEREAS Viking KeyWest has representedto the Decision Makers that:

1. KeyWest was an oil and natural gas acquisition,exploration, development, production and marketing companyincorporated on June 12, 1987 pursuant to the Company Act,Province of British Columbia, under the name Harrisburg-DaytonResource Corp.;

2. the company's name was changed to San FernandoMining Company Ltd. on July 16, 1991;

3. pursuant to a special resolution of shareholderspassed on May 14, 1998, the corporation was authorized tomake application for continuance under the Canada BusinessCorporation Act (the CBCA) and to change the name of thecompany to KeyWest Energy Corporation;

4. effective January 1, 1999, KeyWest amalgamatedunder the CBCA with Colt Energy Inc. and subsequently, onJune 30, 1999, KeyWest amalgamated under the CBCA with SequoiaExploration and Development Ltd.;

5. KeyWest had two subsidiaries, ViewpointResources Ltd., an Alberta corporation and KeyWest EnergyPartnership, a partnership formed under the laws of Alberta;

6. Viking KeyWest was incorporated on January14, 2003 pursuant to the CBCA;

7. Viking KeyWest was incorporated to facilitatethe acquisition of KeyWest, as described below, and priorto the acquisition had not carried on any active businesssince incorporation;

8. the sole shareholder of Viking KeyWestis Viking Holdings Inc.;

9. the authorized share capital of KeyWestas of January 17, 2003 consisted of an unlimited number ofcommon shares (the KeyWest Shares) and an unlimited numberof KeyWest preferred shares, of which 65,813,608 KeyWest Sharesand no preferred shares were issued and outstanding as ofthat date;

10. KeyWest was a reporting issuer, or equivalentthereof, in Alberta, British Columbia, Manitoba, Ontario andQuebec;

11. by virtue of the amalgamation of VikingKeyWest with KeyWest, as described below, Viking KeyWest hasbecome a reporting issuer in these jurisdictions;

12. effective January 17, 2003, Viking EnergyRoyalty Trust (the Trust), Viking Holdings Inc. (in its capacityas trustee for Viking Holdings Trust), Viking KeyWest, KeyWestand Luke Energy Ltd. (Luke) entered into an arrangement agreement(the Arrangement Agreement) pursuant to which Viking KeyWestagreed to acquire all of the outstanding KeyWest Shares byway of a plan of arrangement (the Plan of Arrangement) underthe CBCA;

13. the Plan of Arrangement was approved bya special resolution of the holders (the KeyWest Shareholders)of KeyWest Shares and by order of the Court of Queen's Benchof Alberta pursuant to section 192 of the CBCA on February25, 2003;

14. the purpose of the Plan of Arrangementwas to implement a reorganization of KeyWest resulting in:

(a) certain assets and liabilities of KeyWestbeing transferred to Luke in consideration of the issueto KeyWest of Luke common shares (Luke Shares);

(b) the transfer by KeyWest Shareholdersto Viking KeyWest of all of the KeyWest Shares in exchangefor each KeyWest Shareholder receiving, at the electionof the KeyWest Shareholder, trust units of the Trust (theTrust Units), cash or a combination of Trust Units and cash(subject to proration); and

(c) the distribution of Luke Shares heldby KeyWest to KeyWest Shareholders;

15. on February 26, 2003 pursuant to the Planof Arrangement, Viking KeyWest acquired all of the outstandingKeyWest Shares;

16. in accordance with the Plan of Arrangement,KeyWest was amalgamated with Viking KeyWest effective February26, 2003 and continued under the name "Viking KeyWestInc.";

17. Viking KeyWest remains a wholly-ownedsubsidiary of Viking Holdings Inc.;

18. the KeyWest Shares were de-listed fromthe Toronto Stock Exchange effective at the close of businesson February 27, 2003 and there are no securities of KeyWestor Viking KeyWest listed or quoted on any exchange or market;

19. the Trust and Viking Holdings Inc. consentto no longer receiving continuous disclosure material of VikingKeyWest;

20. other than the shares of Viking KeyWestheld by Viking Holdings Inc. and $175,931,276.27 aggregateprincipal amount of Viking KeyWest notes issued and held bythe Trust, Viking KeyWest has no securities, including debtsecurities, outstanding;

21. Viking KeyWest does not intend to seekpublic financing by way of an offering of its securities;

22. neither Viking KeyWest nor KeyWest isin default of the securities legislation of the Jurisdictions.

AND WHEREAS under the System, this MRRSDecision Document evidences the decision of each Decision Maker(collectively, the Decision);

AND WHEREAS each of the Decision Makersis satisfied that the test contained in the Legislation thatprovides the Decision Maker with the jurisdiction to make theDecision has been met;

THE DECISION of the Decision Makers underthe Legislation is that Viking KeyWest is deemed to have ceasedto be a reporting issuer or the equivalent under the Legislation.

May 16, 2003.

"Patricia M. Johnston"