Securities Law & Instruments

Headnote

National Policy 11-206 Process for Cease to be a Reporting Issuer Applications -- Cease to be a reporting issuer -- The securities of the issuer are beneficially owned by more than 50 persons and are not traded through any exchange or market -- Following an arrangement, all of the issuer's common shares were acquired by another company; all of the issuer's other outstanding securities are exercisable for securities of the acquirer; the acquirer is a reporting issuer and in compliance with its continuous disclosure obligations; the issuer filed notice of its application to cease to be a reporting issuer; securities of the issuer are not traded through any exchange or market.

Applicable Legislative Provisions

Securities Act, R.S.O. 1990, c. S.5, as am., s. 1(10)(a)(ii).

August 26, 2019

IN THE MATTER OF THE SECURITIES LEGISLATION OF BRITISH COLUMBIA AND ONTARIO (the Jurisdictions) AND IN THE MATTER OF THE PROCESS FOR CEASE TO BE A REPORTING ISSUER APPLICATIONS AND IN THE MATTER OF M2 COBALT CORP. (the Filer)

ORDER

Background

1 The securities regulatory authority or regulator in each of the Jurisdictions (Decision Maker) has received an application from the Filer for an order under the securities legislation of the Jurisdictions (the Legislation) that the Filer has ceased to be a reporting issuer in all jurisdictions of Canada in which it is a reporting issuer (the Order Sought).

Under the Process for Cease to be a Reporting Issuer Applications (for a dual application):

(a) the British Columbia Securities Commission is the principal regulator for this application;

(b) the Filer has provided notice that subsection 4C.5(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in Alberta; and

(c) this order is the order of the principal regulator and evidences the decision of the securities regulatory authority or regulator in Ontario.

Interpretation

2 Terms defined in National Instrument 14-101 Definitions and MI 11-102 have the same meaning if used in this order, unless otherwise defined.

Representations

3 This order is based on the following facts represented by the Filer:

1. the Filer (formerly known as Accend Capital Corporation) was incorporated on December 3, 2007 as a capital pool company under the Business Corporations Act (British Columbia) (the BCBCA); the name of the Filer was changed to M2 Cobalt Corp. pursuant to certificate of change of name dated November 27, 2017;

2. prior to the Arrangement (as defined below), the Filer's head office was located at Suite 2000 -- 1177 West Hastings Street, Vancouver, British Columbia, V6E 2K3; the Filer's registered and records office is located at 20th Floor, 250 Howe Street, Vancouver, British Columbia, V6C 3R8;

3. the common shares in the capital of the Filer (the M2 Cobalt Shares) traded on the TSX Venture Exchange (the TSX-V) under the symbol "MC" and on the OTCQB Venture Market (the OTCQB) under the symbol "MCCBF"; no other securities of the Filer were listed on any exchange;

4. Jervois Mining Limited (Jervois) is a corporation existing under the laws of Australia and is extra-provincially registered in British Columbia; the authorized share capital of Jervois consists of an unlimited number of ordinary shares (the Jervois Shares); the Jervois Shares are listed on the Australian Stock Exchange and the TSX-V under the symbol "JRV";

5. immediately prior to the Effective Time (as defined below), the Filer had the following issued and outstanding securities: (i) 63,819,995 M2 Cobalt Shares; (ii) 13,322,012 common share purchase warrants (the M2 Cobalt Warrants) which, based on the Filer's records, are held by 144 holders; (iii) 6,232,500 incentive stock options (the M2 Cobalt Options) which, based on the Filer's records, are held by 17 holders; and (iv) a US$3,000,000 convertible bridge loan facility held solely by Jervois;

6. effective at 12:01 a.m. (Pacific Daylight Time) on June 19, 2019 (the Effective Time), Jervois acquired all of the issued and outstanding M2 Cobalt Shares by way of a statutory plan of arrangement under the BCBCA (the Arrangement);

7. the notice of special meeting of holders of M2 Cobalt Shares (the M2 Cobalt Shareholders) and management information circular of the Filer was delivered to the M2 Cobalt Shareholders entitled to vote at the special meeting of the M2 Cobalt Shareholders that took place on June 14, 2019 to consider the Arrangement;

8. in accordance with the terms of the Arrangement, Jervois acquired all of the M2 Cobalt Shares, for consideration consisting of 1 Jervois Share for each outstanding M2 Cobalt Share (the Share Consideration); additionally, Jervois assumed all of the M2 Cobalt Warrants and all of the M2 Cobalt Options as follows:

(a) pursuant to the terms of the Arrangement and the certificates representing the M2 Cobalt Warrants (the Warrant Certificates), each holder of an M2 Cobalt Warrant became entitled to receive, and Jervois became obligated to provide, upon the exercise of the M2 Cobalt Warrants, such number of Jervois Shares which the holder would have been entitled to receive if the holder had exercised their M2 Cobalt Warrants immediately prior to the Effective Time; and

(b) pursuant to the terms of the Arrangement, the M2 Cobalt Stock Option Plan (the M2 Cobalt Stock Option Plan), which governs the M2 Cobalt Options, and the stock option amending agreements dated March 12, 2019 between M2 Cobalt, on the one hand, and each of the holders of the M2 Cobalt Options, on the other hand (the Stock Option Amending Agreements), each holder of an M2 Cobalt Option became entitled to receive, and Jervois became obligated to provide, upon the exercise of the M2 Cobalt Options, such number of Jervois Shares which the holder would have been entitled to receive if the holder had exercised their M2 Cobalt Options immediately prior to the Effective Time;

9. the Filer is not required to remain a reporting issuer pursuant to the terms of the Warrant Certificates, the M2 Cobalt Stock Option Plan or the Stock Option Amending Agreements; the treatment of the M2 Cobalt Warrants and M2 Cobalt Options in the Arrangement is consistent with the terms of the Warrant Certificates and the M2 Cobalt Stock Option Plan, as applicable; as a result of such treatment, the M2 Cobalt Warrants and M2 Cobalt Options represent the right to receive Jervois Shares and not the M2 Cobalt Shares; as a result, no consents or approvals were required from the holders of the M2 Cobalt Warrants and the M2 Cobalt Options;

10. in connection with the Arrangement, additional Jervois Shares were authorized for issuance upon exercise of the M2 Cobalt Warrants and M2 Cobalt Options;

11. the M2 Cobalt Shares were delisted from the TSX-V and the OTCQB effective at the close of business on June 20, 2019;

12. Jervois is a reporting issuer in each of British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, New Brunswick, Nova Scotia, Prince Edward Island, and Newfoundland and Labrador; as such, Jervois is subject to continuous disclosure requirements; Jervois' continuous disclosure is relevant to holders of M2 Cobalt Warrants and M2 Cobalt Options as such holders are entitled to receive Jervois Shares upon exercise of such securities;

13. Jervois is not in default of securities legislation in any jurisdiction;

14. the Filer is not an OTC reporting issuer under Multilateral Instrument 51-105 Issuers Quoted in the U.S. Over-the-Counter Markets;

15. the Filer has no intention to seek public financing by way of an offering of securities;

16. no securities of the Filer, including debt securities, are traded in Canada or another country on a marketplace as defined in National Instrument 21-101 Marketplace Operation or any other facility for bringing together buyers and sellers of securities where trading data is publicly reported;

17. the Filer is not a reporting issuer in any jurisdiction of Canada other than the jurisdictions identified in this order; the Filer is applying for an order that it has ceased to be a reporting issuer in all of the jurisdictions of Canada in which it is currently a reporting issuer;

18. the Filer is not in default of securities legislation in any jurisdiction;

19. the Filer is not eligible to use the simplified procedure under National Policy 11-206 Process for Cease to be a Reporting Issuer Applications because the M2 Cobalt Warrants and the M2 Cobalt Options are not beneficially owned, directly or indirectly, by fewer than 15 securityholders in each of the jurisdictions of Canada and fewer than 51 securityholders in total worldwide; and

20. upon the granting of the Order Sought, the Filer will not be a reporting issuer or the equivalent in any jurisdiction in Canada.

Order

Each of the Decision Makers is satisfied that the order meets the test set out in the Legislation for the Decision Maker to make the order.

The decision of the Decision Makers under the Legislation is that the Order Sought is granted.

"John Hinze"
Director, Corporate Finance
British Columbia Securities Commission