Bandolac Mining Company, Limited - s. 144

Order

Headnote

Application by an issuer for a revocation of a cease trade order issued by the Commission - cease trade order issued because the issuer had failed to file certain continuous disclosure materials required by Ontario securities law - defaults subsequently remedied by bringing continuous disclosure filings up-to-date - cease trade order revoked.

Statutes Cited

Securities Act, R.S.O. 1990, c. S.5, as am., ss. 127(3), 144.

IN THE MATTER OF

THE SECURITIES ACT,

R.S.O. 1990, CHAPTER S.5, AS AMENDED

(the "Act")

AND

IN THE MATTER OF

BANDOLAC MINING COMPANY, LIMITED

 

ORDER

(Section 144)

WHEREAS the securities of Bandolac Mining Company, Limited ("Bandolac") are subject to a temporary cease trade order made by the Director on May 28, 2004 under paragraph 2 of subsection 127(1) and subsection 127(5) of the Act, as extended by an order made by the Director on June 9, 2004 under paragraph 2 of subsection 127(1) of the Act (collectively, the "Cease Trade Order"), directing that all trading in securities of Bandolac cease until the Cease Trade Order is revoked;

AND WHEREAS Bandolac has applied to the Ontario Securities Commission (the "Commission") pursuant to section 144 of the Act (the "Application") for a revocation of the Cease Trade Order;

AND WHEREAS Bandolac has represented to the Commission that:

1. Bandolac was incorporated in Ontario by Letters Patent dated September 17, 1940 under the Business Corporations Act (Ontario).

2. Bandolac became a reporting issuer in Ontario on or about December 16, 1940. Bandolac is not a reporting issuer or the equivalent in any other jurisdiction.

3. The authorized capital of Bandolac consists of an unlimited number of Common Shares without par value, of which 2,941,322 Common Shares are currently issued and outstanding.

4. The Common Shares of Bandolac are not listed for trading on a stock exchange. Other than the Common Shares, and 180,000 options, Bandolac has no securities (including debt securities) outstanding.

5. Bandolac's SEDAR and SEDI profiles are up-to-date.

6. The Cease Trade Order was issued due to the failure of Bandolac to file with the Commission in accordance with the requirements of Ontario securities law annual audited financial statements for the year ended December 31, 2003 and management's discussion and analysis related thereto.

7. Bandolac subsequently failed to file with the Commission in accordance with the requirements of Ontario securities law (i) annual audited financial statements for the years ended December 31, 2004, December 31, 2005 and December 31, 2006, as required by National Instrument 51-102 Continuous Disclosure Obligations ("NI 51-102"), (ii) the management's discussion and analysis related thereto, as required by NI 51-102, (iii) and certifications related thereto for the financial years ended December 31, 2004, December 31, 2005 and December 31, 2006, as required by Multilateral Instrument 52-109 Certification of Disclosure in Issuers' Annual and Interim Filings ("MI 52-109").

8. Pursuant to an order dated August 27, 1998 (the "1998 Order"), Bandolac believed it was exempted from filing interim financial statements during any fiscal year, including for the periods described in paragraph 7 and for the interim periods ended March 31, 2007, June 30, 2007 and September 30, 2007, together with management's discussion and analysis related thereto, as required by NI 51-102. Consequently, certifications for such interim periods, as required by MI 52-109, were not filed.

9. In order to rely on the 1998 Order, Bandolac was required to inform the Commission pursuant to subsection 13.2(2) of NI 51-102 that it intended to rely on the 1998 Order. However, Bandolac did not inform the Commission of the 1998 Order when NI 51-102 came into effect.

10. Bandolac further failed to pay Participation Fees for the years ended December 31, 2003, December 31, 2004, December 31, 2005 and December 31, 2006 as required by OSC Rule 13-502 Fees.

11. Bandolac has now substantially brought its continuous disclosure filings up-to-date. On March 20, March 26, March 27 and July 10, 2008, Bandolac filed with the Commission through SEDAR:

a. annual audited financial statements for the years ended December 31, 2005, December 31, 2006 and December 31, 2007, together with management's discussion and analysis related thereto, as required by NI 51-102;

b. interim financial statements for the periods ended March 31, 2007, June 30, 2007 and September 30, 2007, together with management's discussion and analysis related thereto, as required by NI 51-102; and

c. certifications for the years ended December 31, 2005, December 31, 2006 and December 31, 2007 and the interim periods ended March 31, 2007, June 30, 2007 and September 30, 2007, as required by MI 52-109.

12. Bandolac has filed all applicable forms under OSC Rule 13-502 Fees and paid all applicable activity fees, participation fees and late filing fees in accordance with, as follows:

a. participation fees (including late fees) for the financial years ending December 31, 2003 to December 31, 2007, inclusive; and

b. late document fees for the late filing of the annual audited financial statements for the years ended December 31, 2005 and December 31, 2006, and interim financial statements for the periods ended March 31, 2007, June 30, 2007 and September 30, 2007.

13. Except for the deficiencies listed in paragraphs 6, 7, 8 and 10, which have now been substantially remedied as described in paragraphs 11 and 12, Bandolac is up-to-date with all of its other continuous disclosure obligations.

14. Bandolac has not carried on any active business operations since at least 1973 and is not currently engaged in any active business operations.

15. Other than a minimal amount of cash, Bandolac's sole asset is its holding of 310,968 Common Shares of West Timmins Mining Inc. ("West Timmins"), representing less than 1% of West Timmins' outstanding Common Shares, representing a liquid financial resource of approximately $211,458. This shareholding was originally acquired in 1947 as a shareholding in Band-Ore Resources Ltd., a company which amalgamated to form West Timmins in 2006. West Timmins is a reporting issuer whose Common Shares are listed on The Toronto Stock Exchange.

16. Bandolac intends to liquidate its holdings of West Timmins shares only as needed to fund Bandolac's administrative and regulatory costs and costs of business operations.

17. Bandolac has funded its administrative activities by interest free loans from its directors and the periodic liquidation of its holding of Common Shares of West Timmins. The directors were reluctant to dissipate the long term investment and have advanced interest free loans to fund the preparation of current financial statements, pay Bandolac's previous transfer agent's maintenance fees in order to obtain the shareholder records and engage a new transfer agent, and engage accountants to prepare audited financial statements. As of March 31, 2008, $96,958 was owed by Bandolac to its directors for such expenses.

18. Except as described above, Bandolac is not, to its knowledge, in default of any of the requirements of the Act or the rules and regulations made thereunder.

19. There are no other material facts concerning Bandolac which have not been furnished to the shareholders and to the Commission.

20. Bandolac has provided the Commission with a draft management information circular (the "Circular") as well as an undertaking pursuant to section 3.1(5) of National Policy 12-202 Revocation of Compliance-related Cease Trade Order.

21. Bandolac intends to deliver the audited annual financial statements and related MD&A for the years ended December 31, 2005 to December 31, 2007 to shareholders along with the mailing of the Circular.

22. Bandolac undertakes to convene a meeting of its shareholders no later than three months from the date of the revocation of the Cease Trade Order.

23. Bandolac is not considering, nor is it involved in any discussions relating to a reverse take-over, merger, amalgamation or other form of combination or transaction similar to any of the foregoing.

AND UPON considering the application and the recommendations of staff of the Commission;

AND UPON the Director being satisfied that the Issuer has remedied its defaults in respect of the filing requirements under the Act;

AND UPON the Director being satisfied that to do so would not be prejudicial to the public interest;

IT IS ORDERED pursuant to section 144 of the Act that the Cease Trade Order is revoked.

DATED this 25th day of July, 2008.

"Jo-Anne Matear"
Assistant Manager, Corporate Finance
Ontario Securities Commission