MRRS -- Relief granted, subject to certain conditions,from the Dealer Registration Requirement set out in clause 25(1)(a)of the Securities Act (Ontario) in respect of certain tradesby and to Filer under its "asset reunification program".
Applicable Ontario Statutory Provisions
Securities Act, R.S.O. 1990, c. S.5, as am.,s. 25(a).
IN THE MATTER OF
THE SECURITIES LEGISLATIONOF
ALBERTA, BRITISH COLUMBIA,MANITOBA, NEW BRUNSWICK, NEWFOUNDLAND AND LABRADOR, NOVA SCOTIA,
ONTARIO, PRINCE EDWARD ISLAND,SASKATCHEWAN, QUEBEC, NORTHWEST TERRITORIES,
NUNAVUT AND YUKON
IN THE MATTER OF
THE MUTUAL RELIANCE REVIEWSYSTEM
FOR EXEMPTIVE RELIEF APPLICATIONS
IN THE MATTER OF
GEORGESON SHAREHOLDER COMMUNICATIONSCANADA INC.
MRRS DECISION DOCUMENT
WHEREAS the local securities regulatoryauthority or regulator (collectively, the "Decision Makers")in each of the Provinces of Alberta, British Columbia, Manitoba,New Brunswick, Newfoundland and Labrador, Nova Scotia, Ontario,Prince Edward Island, Saskatchewan, Quebec, Northwest Territories,Nunavut and the Yukon (the "Jurisdictions") has receivedan application from Georgeson Shareholder Communications CanadaInc. ("Georgeson") for a decision under the securitieslegislation of each of the Jurisdictions (the "Legislation")that certain trades to and by Georgeson under Georgeson's assetreunification program (the "Program"), as more fullydescribed below, are not subject to the registration requirementsof the Legislation;
AND WHEREAS under the Mutual RelianceReview Systems for Exemptive Relief Applications (the "System"),the Ontario 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 Georgeson has representedto the Decision Makers that:
1. Pursuant to the Program, Georgeson is engagedby issuers ("Issuers") to assist them in locatingsecurityholders ("Securityholders") who either (a)hold securities of entities acquired or merged into, or securitieswhich have by their terms matured or terminated or been redeemedby, such Issuers (or parties related to the Issuers) and,in each case, who failed to tender or submit their securities("Unexchanged Securities"), or (b) by virtue oftheir ownership of securities of the Issuer are entitled toreceive securities ("Additional Securities") ofan entity that has been spun-out by the Issuer, and to facilitatethe exchange of Unexchanged Securities or the claiming ofAdditional Securities, as the case may be;
2. The purpose of the Program is to reuniteSecurityholders with the consideration (the "Consideration")to which they were entitled under the merger/acquisition transaction,redemption/maturity or spin-out (as the case may be, eacha "Transaction"), whether such Consideration consistsof cash, non-cash ("New Securities") or both;
3. Securityholders who agree to participatein the Program are charged a fee (the "Fee") byGeorgeson on a per security basis equal to a percentage (typically10%) of the value (at the date of implementation of the Program)of the Consideration to which such Securityholders are entitledunder the relevant Transaction. Securityholders are underno obligation to participate in the Program and are free toexchange their Unexchanged Securities or claim their AdditionalSecurities (as the case may be) directly;
4. Where the Consideration consists of sufficientcash to cover the Fee, Securityholder consent is obtainedfor the deduction of the Fee from the Consideration receivedunder the exchange, with the balance remitted to the Securityholder.Where the Consideration does not include sufficient cash topay the Fee, the Securityholder is invoiced;
5. Georgeson intends to modify the Program(as so changed, the "Modified Program") to enableGeorgeson to recover the Fee without having to invoice Securityholdersentitled to non-cash Consideration. Specifically, Securityholderswill be asked either to authorize the transfer of 10% of theNew Securities to Georgeson in full satisfaction of the Fee(the "Transfer Alternative") or to appoint Georgesonas agent to cause the sale on the Securityholder's behalfthrough a duly registered dealer of sufficient New Securitiesto satisfy the Fee (the "Sale Alternative");
6. Where a Modified Program is implemented:
(a) Securityholders will be mailed a packageof documents (an "Information Package") approvedby the relevant Issuer informing them of their entitlementto exchange their Unexchanged Securities or claim the AdditionalSecurities, as the case may be;
(b) the Information Package will describethe services to be provided by Georgeson under the saidModified Program and the Fee payment alternatives;
(c) Securityholders will be invited to clarifyany questions they may have about the Modified Program bycontacting Georgeson, but Securityholders with inquiriesconcerning the Transaction itself or related matters willbe encouraged to contact their professional advisors;
(d) the Information Package will state clearlythat participation in the program is voluntary;
(e) Georgeson will bear all costs of administeringthe Modified Program, including the cost of all commissionfees incurred on behalf of Securityholders in connectionwith execution of the Sale Alternative; and
(f) Securityholders will receive a reportfrom Georgeson outlining the details of the administrationof the Modified Program, including the number of New Securitiestransferred or sold, the proceeds of any sale and the Fee.
7. Trades by Securityholders to Georgesonpursuant to the Transfer Alternative are exempt from the registrationrequirements contained in the securities legislation of theprovinces of Alberta, British Columbia and Ontario (collectively,the "Accredited Investor Jurisdictions");
8. To the extent that trades by Securityholdersto Georgeson pursuant to the Transfer Alternative are notexempt from the registration requirements in the Legislation(other than the Legislation in the Accredited Investor Jurisdictions,under which exemptions would be available), Securityholderswould be prohibited from transferring New Securities to Georgesonin the absence of the ruling hereby requested;
9. Georgeson's activities with respect tothe Sale Alternative constitute trades of securities for thepurposes of the registration requirements in the Legislation,and consequently Georgeson would be prohibited from engagingin such activities in the absence of the ruling hereby requested;
AND WHEREAS pursuant to the System, thisMRRS Decision Document evidences the decision of each DecisionMaker (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 pursuantto the Legislation is that:
(a) to the extent that in the Legislation(other than the Accredited Investor Jurisdictions) there areno registration exemptions available in respect of the transferof New Securities by Securityholders to Georgeson pursuantto the Transfer Alternative, the registration requirementscontained in the Legislation shall not apply to such tradesor to activities incidental thereto; and
(b) the registration requirements containedin the Legislation shall not apply to trades pursuant to theSale Alternative or to activities incidental thereto, providedthat in the Jurisdictions of Ontario and Newfoundland andLabrador, Georgeson shall have registered under the Legislationof the Jurisdiction as a dealer in the category of "limitedmarket dealer" within six months of the date hereof.
June 11, 2003.
"Paul M. Moore"
"Harold P. Hands"