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Edgewater Wireless Systems Inc.
Headnote
Subsection 1(11)(b) -- Order that the issuer is a reporting issuer for the purposes of Ontario securities law -- Issuer is already a reporting issuer in Alberta and British Columbia -- Issuer's securities listed for trading on the TSX Venture Exchange -- Continuous disclosure requirements in Alberta and British Columbia are substantially the same as those in Ontario -- Issuer has a significant connection to Ontario.
Statutes Cited
Securities Act, R.S.O. 1990, c. S.5, as am., s. 1(11)(b).
IN THE MATTER OF THE SECURITIES ACT, R.S.O. 1990, CHAPTER S.5, AS AMENDED (THE ACT) AND IN THE MATTER OF EDGEWATER WIRELESS SYSTEMS INC.
ORDER (CLAUSE 1(11)(b) OF THE ACT)
UPON the application of Edgewater Wireless Systems Inc. (the "Applicant") to the Ontario Securities Commission (the "Commission") for an order pursuant to clause 1(11)(b) of the Act that, for the purposes of Ontario securities law, the Applicant is a reporting issuer in Ontario;
AND UPON considering the application and the recommendation of the staff of the Commission;
AND UPON the Applicant representing to the Commission as follows:
1. The Applicant was incorporated in the Province of British Columbia on January 8, 1980 under the name "Calpetro Resources Inc.", and was continued under the Canada Business Corporations Act on January 22, 1987 under the name "Nucal Resources Ltd." The Applicant changed its name to "Captive Air International Inc." on September 8, 1987 and to "KIK Tire Technologies Inc." on March 21, 1996. On May 5, 2006, the Applicant changed its name to "KIK Polymers Inc." and to "Edgewater Wireless Systems Inc." effective February 1, 2012.
2. The Applicant's registered office is located at 1200 -- 750 West Pender Street, Vancouver, British Columbia, V6C 2T8, and its head office is located at Suite 200 -- 50 Hines Road, Ottawa, Ontario, K2K 2M5.
3. The authorized share capital of the Applicant consists of:
(a) an unlimited number of common voting shares without par value of which a total of 121,914,477 are issued and outstanding as of June 23, 2015;
(b) 1,600,000 convertible preferred shares Series 1, none of which are currently outstanding; and
(c) an unlimited number of convertible voting preferred shares Series 2, none of which are currently outstanding.
4. The Applicant became a reporting issuer under the Securities Act (Alberta) (the "Alberta Act") on October 12, 1983 and the Securities Act (British Columbia) (the "BC Act") on October 1, 1983.
5. The Applicant is not currently a reporting issuer or the equivalent in any jurisdiction in Canada other than Alberta and British Columbia.
6. The Applicant has confirmed that after becoming a reporting issuer in Ontario, it will designate Ontario as the principal regulator.
7. The Applicant is not on the lists of defaulting reporting issuers maintained by the Alberta Securities Commission and the British Columbia Securities Commission. To the knowledge of the officers and directors of the Applicant, the Applicant has not been the subject of any enforcement actions by the Alberta or British Columbia securities commissions or by the TSX Venture Exchange (the "Exchange"), and the Applicant is not in default of any requirement of the Act, the Alberta Act, the BC Act or the rules and regulations made thereunder.
8. The continuous disclosure requirements of the Alberta Act and BC Act are substantially the same as the continuous disclosure requirements under the Act.
9. The continuous disclosure materials filed by the Applicant in the Provinces of Alberta and British Columbia are available on the System for Electronic Document Analysis and Retrieval ("SEDAR").
10. The Applicant's Common Shares are listed and posted for trading on the Exchange under the trading symbol "YFI".
11. The Applicant is not in default of any of the rules, regulations or policies of the Exchange.
12. The Applicant completed an acquisition in November, 2011 (the "Acquisition"), pursuant to which it issued 35,000,000 common shares to a company located in Ontario as consideration for the assets acquired in the Acquisition. Those shares comprised approximately 35% of the outstanding common shares of the Applicant upon completion of the Acquisition.
13. In connection with a review of the Acquisition conducted by the Exchange, it was determined that upon completion of the Acquisition the Applicant would have a "significant connection to Ontario" (as defined in Exchange policies) because beneficial holders of the Applicant's securities resident in Ontario would hold more than 20% of the Applicant's common shares. In addition, the Applicant's head office, principal operations and most of its management are located in Ontario.
14. Pursuant to the policies of the Exchange, a listed issuer, which is not otherwise a reporting issuer in Ontario, must assess whether it has a "significant connection to Ontario" (as defined in the policies of the Exchange) and upon becoming aware that it has a significant connection to Ontario, the issuer must promptly make a bona fide application to the Commission to be deemed a reporting issuer in Ontario.
15. Since it was apparent that the Applicant would have a significant connection to Ontario upon completion of the Acquisition, the Exchange, as a condition to its acceptance of the Acquisition, requested that the Applicant make an Application to become a reporting issuer in Ontario after the completion of the Acquisition.
16. Neither the Applicant nor any of its officers, directors, nor, to the knowledge of the Applicant or its officers and directors, any shareholder holding sufficient securities of the Applicant to affect materially the control of the Applicant, has:
(a) been the subject of any penalties or sanctions imposed by a court relating to Canadian securities legislation or by a Canadian securities regulatory authority;
(b) entered into a settlement agreement with a Canadian securities regulatory authority; or
(c) been subject to any other penalties or sanctions imposed by a court or regulatory body that would be likely to be considered important to a reasonable investor making an investment decision.
17. Neither the Applicant nor any of its officers, directors, nor, to the knowledge of the Applicant or its officers and directors, any shareholder holding sufficient securities of the Applicant to affect materially the control of the Applicant, is or has been subject to:
(a) any known ongoing or concluded investigations by:
(i) a Canadian securities regulatory authority; or
(ii) a court or regulatory body, other than a Canadian securities regulatory authority, that would be likely to be considered important to a reasonable investor making an investment decision; or
(b) any bankruptcy or insolvency proceedings, or other proceedings, arrangements or compromises with creditors, or appointment of a receiver, receiver-manager or trustee, within the preceding 10 years.
18. None of the officers or directors of the Applicant, nor, to the knowledge of the Applicant or its officers and directors, any shareholder holding sufficient securities of the Applicant to affect materially the control of the Applicant, is or has been at the time of such event an officer or director of any other issuer which is or has been subject to:
(a) any cease trade order or similar order, or order that denied access to any exemptions under Ontario securities law, for a period of more than 30 consecutive days, within the preceding 10 years; or
(b) any bankruptcy or insolvency proceedings, or other proceedings, arrangements or compromises with creditors, or appointment of a receiver, receiver-manager or trustee, within the preceding 10 years;
other than the following:
I. Lewis Dillman, a director of the Company, was a director and chief financial officer of Hellix Ventures Inc. ("Hellix") when a cease trade order (the "CTO") was issued by the British Columbia Securities Commission prohibiting trading in the securities of Hellix;
II. the CTO was issued because Hellix failed to file its financial statements and management discussion and analysis for the year ended July 31, 2012 as required by and within the time prescribed under Part 4 and Part 5 of National Instrument 51-102 -- Continuous Disclosure Obligations; and
III. Hellix filed its financial statements and management discussion and analysis for the year ended July 31, 2012 on February 22, 2013 and the CTO was revoked by the British Columbia Securities Commission on February 26, 2013.
AND UPON the Commission being satisfied that to do so would not be prejudicial to the public interest;
IT IS HEREBY ORDERED pursuant to clause 1(11)(b) of the Act that the Applicant be deemed to be a reporting issuer for the purposes of Ontario securities law.
DATED at Toronto on this 26th day of June, 2015.
"Sonny Randhawa"
Manager, Corporate Finance
Ontario Securities Commission