Texada Software Inc.

Decision

Headnote

Multilateral Instrument 11-102 Passport System and National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- Confidentiality -- Application by an issuer for a decision that draft versions of interim financial statements and management's discussion and analysis inadvertently filed and made public on SEDAR be held in confidence for an indefinite period by the Commission, to the extent permitted by law -- Original draft documents contain intimate financial, personal and other information between issuer and its auditor -- Subject information not material or necessary to understand interim financial statements or management's discussion and analysis -- Issuer subsequently filed and made public on SEDAR correct, final versions of interim financial statements and management's discussion and analysis -- Relief granted.

Applicable Ontario Legislative Provisions

Securities Act, R.S.O. 1990, c. S.5, as am., ss. 140(1), 140(2).

Applicable Instruments

National Instrument 51-102 Continuous Disclosure Obligations.

November 4, 2011

IN THE MATTER OF

THE SECURITIES LEGISLATION OF

ONTARIO

(the Jurisdiction)

AND

IN THE MATTER OF

THE PROCESS FOR EXEMPTIVE RELIEF

APPLICATIONS IN MULTIPLE JURISDICTIONS

AND

IN THE MATTER OF

TEXADA SOFTWARE INC. (the Filer)

DECISION

Background

The principal regulator in the Jurisdiction has received an application from the Filer for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) that, pursuant to the confidentiality provisions of the Legislation (being subsection 140(2) of the Securities Act (Ontario)), the versions of the Filer's interim financial results and related management's discussion and analysis for the period ended June 30, 2011 filed on the System for Electronic Document Analysis and Retrieval (SEDAR) on August 26, 2011 (collectively, the Original Filed Documents) be held in confidence (and therefore not available to the public for inspection) for an indefinite period, to the extent permitted by law (the Exemption Sought).

Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):

(a) The Ontario Securities Commission (the Principal Regulator) is the principal regulator for the application; and

(b) The Filer has provided notice that section 4.7(1) of Multilateral Instrument 11-102 Passport System is intended to be relied upon in each of British Columbia and Alberta (the Non-Principal Passport Jurisdictions).

Interpretation

Terms defined in National Instrument 14-101 Definitions have the same meaning if used in this decision, unless otherwise defined.

Representations

This decision is based on the following facts represented by the Filer:

1. The Filer exists pursuant to articles of continuance dated November 5, 2008 filed in accordance with the Business Corporations Act (Ontario).

2. The registered and head office of the Filer is located in Guelph, Ontario.

3. The Filer's common shares are listed on the TSX Venture Exchange and the Filer is a reporting issuer in Ontario and the Non-Principal Passport Jurisdictions.

4. On August 26, 2011, the Filer filed the Original Filed Documents on SEDAR, in accordance with section 4.3 of National Instrument 51-102 Continuous Disclosure Obligations (NI 51-102), accompanied by the certifications required under National Instrument 52-109 Certification of Disclosure in Issuers' Annual and Interim Filings (NI 52-109).

5. Thereafter, it came to the Filer's attention that the Original Filed Documents were inadvertently filed in draft format and contained certain comments by the Filer's auditors, KPMG LLP (the Auditor) in the margins that were not intended to be made public (the Confidential Information) and, due to a confluence of circumstances, had erroneously not been removed from the Original Filed Documents prior to filing.

6. Following discussions with staff of the Principal Regulator on August 29, 2011, the Filer re-filed "final draft" versions of the Original Filed Documents on SEDAR (together with the certifications required under NI 52-109 dated August 29, 2011) which, other than excluding the Confidential Information, do not differ from the Original Filed Documents which were previously filed on August 26, 2011.

7. On August 31, 2011, the staff of the Principal Regulator temporarily marked the Original Filed Documents containing the Confidential Information as private on SEDAR, pending the receipt and review of a formal application for exemptive relief from the Filer. As a result, as of September 1, 2011, the Original Filed Documents containing the Confidential Information no longer appear under the Filer's profile on SEDAR.

8. The Filer believes that continued public access to the Confidential Information would seriously prejudice the interests of the Filer for the following reasons:

(a) pursuant to the contractual terms of the engagement between the Filer and the Auditor, the Filer is expressly prohibited from disclosing any of the deliverables or communications, in whole or in part, transmitted between the parties as they relate to the scope of the services provided by the Auditor to the Filer;

(b) as a result of the filing of the Original Filed Documents containing the Confidential Information, the Filer inadvertently breached the contractual terms of its engagement with the Auditor during the two day period in which the Confidential Information was available to the public through SEDAR. In the event that the Confidential Information was to continue to be made available, the Filer would continue to be in breach of such terms and could be found to be in breach of its contractual duty of confidentiality to the Auditor; and

(c) the continued public availability of the Confidential Information could materially harm the relationship between the Auditor and the Filer who has been the auditor of the Filer since 2000 and it is in the best interests of the Filer and its investors to continue this relationship.

9. The Confidential Information does not form part of the required disclosure or financial data that is required by the Filer to be disclosed in the Original Filed Documents pursuant to NI 51-102 and was never intended to be made available to the public by the Filer.

10. None of the Confidential Information, either individually or in the aggregate, is necessary to understand the Original Filed Documents.

11. None of the Confidential Information, either individually or in the aggregate, would cause the Chief Executive Officer and Chief Financial Officer of the Filer to submit revised certifications under NI 52-109 in respect of the Original Filed Documents or otherwise preclude them from filing certifications under NI 52-109 in respect of the Original Filed Documents.

12. The Confidential Information is not material to an investor, and the making and keeping private of the Confidential Information will not adversely affect investors or impact the decision by an investor for the purposes of making any investment decision with respect to the Filer and therefore there is no prejudice or harm to the public as a result of the Confidential Information remaining private.

13. The Filer believes that: (i) the negative implications to the Filer and its investors were the Confidential Information to be made public outweigh the desirability of adhering to the principle that material filed with the Principal Regulator be available to the public for inspection and, (ii) the disclosure of the Confidential Information is not necessary in the public interest.

14. As of August 29, 2011, the Issuer has fully complied with its disclosure obligations under NI 51-102. The Filer is not in default of its obligations under the securities legislation of any jurisdiction of Canada.

15. The Filer acknowledges that marking the Original Filed Documents containing the Confidential Information private on SEDAR does not guarantee that the Original Filed Documents are not available elsewhere in the public domain.

Decision

The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.

The decision of the principal regulator under the Legislation is that the Exemption Sought is granted.

"Wes M. Scott"
Commissioner
 
"Judith Robertson"
Commissioner