Securities Law & Instruments

Headnote

Mutual Reliance Review System for ExemptiveRelief Applications -- MI 45-102 -- Issuer exempted from therequirement in the definition of 'qualifying issuer' in MI 45-102to have a current annual information form (AIF) filed on SEDAR,subject to certain conditions. Relief allows first trade ofissuer's securities to be completed after a four-month resalerestriction instead of the usual 12-month restricted period.Issuer allowed to use its reverse take-over information circular,approved by the TSX Venture Exchange and the Toronto Stock Exchange,as an alternate form of AIF.

Ontario Rules

Multilateral Instrument 45-102. Resale of Securities-- s. 4.1.

IN THE MATTER OF

THE SECURITIES LEGISLATIONOF

BRITISH COLUMBIA, ALBERTA,AND ONTARIO

AND

IN THE MATTER OF

THE MUTUAL RELIANCE REVIEWSYSTEM

FOR EXEMPTIVE RELIEF APPLICATIONS

AND

IN THE MATTER OF

MILLENNIUM ENERGY INC.

 

MRRS DECISION DOCUMENT

1. WHEREAS the local securities regulatoryauthority or regulator (the "Decision Maker") inBritish Columbia, Alberta, and Ontario (the "Jurisdictions")has received an application from Millennium Energy Inc. ("Millennium")for a decision under section 4.1 of Multilateral Instrument45-102 Resale of Securities ("MI 45-102")that the requirement contained in MI 45-102 for a qualifyingissuer (the "Qualifying Issuer") to have a currentannual information form ("AIF") filed on the systemfor electronic document analysis and retrieval ("SEDAR")shall not apply to Millennium;

2. AND WHEREAS under the Mutual Reliance ReviewSystem for Exemptive Relief Applications (the "System")the Alberta Securities Commission is the principal regulatorfor this application;

3. AND WHEREAS, unless otherwise defined,the terms herein have the meaning set out in National Instrument14-101 Definitions;

4. AND WHEREAS Millennium has representedto the Decision Makers that:

4.1 Millennium is a corporation incorporatedunder the laws of Alberta and its head office is locatedin Calgary, Alberta;

4.2 Millennium is a reporting issuer underthe securities legislation in each of the Jurisdictions(the "Legislation") and is not in default of anyof its obligations under Legislation;

4.3 the common shares of Millennium arelisted and posted on the TSX Venture Exchange (the "Exchange");

4.4 Millennium's authorized share capitalconsists of an unlimited number of common shares (the "CommonShares") and an unlimited number of Class B Shares,Class C Shares, Class D Shares and Class E Shares preferredshares of which, at the date hereof, there are 24,790,459Common Shares outstanding;

4.5 by way of a statutory plan of arrangement(the "Arrangement"), expected to become effectiveon or about July 24, 2003, among Millennium and its securityholders, Crossfield Gas Corp. ("Crossfield") andits security holders, 1036655 Alberta Ltd., and 1050412Alberta Ltd.,

4.5.1 Millennium will issue 6.3 CommonShares for each Crossfield common share and special warrant,based on an ascribed value of $0.22 (pre-consolidated)per Common Share;

4.5.2 each option of Crossfield will bechanged into an option to acquire 6.3 pre-consolidatedCommon Shares; and

4.5.3 a consolidation of the outstandingCommon Shares will occur on a one for 15 basis;

4.6 the Arrangement constitutes a constitutesa reverse take-over under Exchange Policy 5.2 Changesof Business and Reverse Take-overs;

4.7 before the closing of the Arrangement,Millennium proposes to complete a financing ("Financing")for aggregate gross proceeds of up to $1,200,000, by wayof a private placement to Millennium insiders and otherparties designated by Millennium;

4.8 the Financing will consist of the issueof units priced at $0.24 (pre-consolidated), that are contemplatedto be issued to residents of Alberta and an internationalresident, each of which will consist of one Common Shareand one Millennium warrant;

4.9 the placees under the Financing willbe directors and senior officers of Millennium and certainof their spouses and children and employees of APF EnergyInc., a management company which, pursuant to a managementcontract with Millennium, manages the business and propertiesof Millennium, and certain of their spouses;

4.10 all of the placees under the Financinghave the same access to information about Millennium, itsassets and operations;

4.11 special meetings ("Special Meetings")for the security holders (the "Security Holders")of Millennium and Crossfield, respectively, are to be heldon or about July 24, 2003, where the Security Holders, respectively,will be asked to pass a special resolution (the "SpecialResolution") approving the Arrangement, amongst othermatters;

4.12 Millennium and Crossfield prepareda draft joint management information circular (the "Circular")in connection with the Arrangement and the Special Meetings;

4.13 the Circular has been filed with theExchange and the Toronto Stock Exchange ("TSX")and has been reviewed and approved by the Exchange;

4.14 the Circular contains prospectus leveldisclosure and includes,

4.14.1 audited financial statements ofMillennium for each of its last three financial years;

4.14.2 audited financial statements ofCrossfield for the two years that it has been in existence;

4.14.3 audited operating statements withrespect to a significant acquisition made by Crossfieldin 2001; and

4.14.4 pro forma financial statementsfor Millennium for the year ended December 31, 2002 andfor the three months ended March 31, 2003;

4.15 Millennium and Crossfield have alsohad independent engineering reports consistent with NationalPolicy Statement 2-B Guide for Engineers, Geologistsand Prospectors Submitting Oil and Gas Reports to CanadianProvincial Securities Administrators prepared effectiveJanuary 1, 2003 with respect to their oil and natural gasproperties, which they have filed in accordance with NationalInstrument 13-101 SEDAR;

4.16 Millennium has received conditionalapproval from the Exchange and TSX regarding the listingof the shares to be issued on the Arrangement;

4.17 as Millennium does not have a currentAIF, as defined in MI 45-102, filed on SEDAR, it is nota qualifying issuer under MI 45-102; and

4.18 the Circular contains all of the informationthat is prescribed by Form 44-101 F1 AIF of National Instrument44-101 Short Form Prospectus Distributions;

5. AND WHEREAS under the System, this MRRSDecision Document evidences the decision of each DecisionMaker (collectively, the "Decision");

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

7. THE DECISION of the Decision Makers underMI 45-102 is that:

7.1. under section 4.1 of MI 45-102, Millenniumis exempt from the requirement contained in the definitionof Qualifying Issuer to have a current AIF filed on SEDARprovided that:

7.1.1 Millennium files a Form 45-102F2on or before the tenth day after the distribution dateof any securities certifying that it is a Qualifying Issuerexcept for the requirement that Millennium have a currentAIF; and

7.1.2 at the distribution date of anysecurities, Millennium has filed a notice on SEDAR advisingthat it has filed the Circular as an alternative formof AIF and identifying the SEDAR project number underwhich the Circular was filed; and

7.2 this order expires 140 days after Millennium'sfinancial year ended December 31, 2003.

July 23, 2003.

"Glenda A. Campbell"
"Stephen R. Murison"