Colossus Minerals Inc. – s. 144

Headnote

Section 144 of the Securities Act (Ontario) – application by issuer for partial revocation of a cease trade order to permit the issuer to distribute securities to creditors pursuant to a proposal and plan of reorganization under the Business Corporations Act (Ontario) and the Bankruptcy and Insolvency Act (Canada) – partial revocation granted subject to conditions.

Applicable Legislative Provisions

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

National Policy 12-202 Revocation of a Compliance-related Cease Trade Order.

July 12, 2017

IN THE MATTER OF

THE SECURITIES ACT,

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

(the Act)

AND

IN THE MATTER OF

COLOSSUS MINERALS INC.

ORDER

(Section 144 of the Act)

                WHEREAS the securities of Colossus Minerals Inc. (the Filer) are subject to a cease trade order issued by the Director on May 12, 2014 pursuant to subsection 127(1) of the Act (the Ontario CTO), directing that all trading in the securities of the Filer cease until further order by the Director;

                AND WHEREAS the Filer has applied to the Ontario Securities Commission (the Commission) for an order pursuant to section 144 of the Act (the Application) to partially revoke the Ontario CTO to enable the Filer to undertake and complete the distribution of its securities to those of its proven creditors resident in or subject to the securities laws of Ontario;

                AND WHEREAS the Filer has represented to the Commission that:

1.             The Filer is a corporation incorporated under the laws of the Province of Ontario on February 9, 2006.

2.             The Filer is not actively carrying on business and has disposed of all of its material assets and properties. The Filer was a development stage mining and exploration company focused on putting into production a gold and platinum group metals project in Brazil.

3.             The authorized capital of the Filer consists of an unlimited number of common shares, of which 49,588,134 common shares are issued and outstanding as of the date hereof.

4.             The Filer’s head office at the time of issue of the Ontario CTO was located at 100 King Street West, Suite 5600, Toronto, Ontario M5X 1C9.

5.             The Filer is a reporting issuer in the provinces of British Columbia, Alberta, Saskatchewan, Manitoba, Ontario, New Brunswick, Nova Scotia, Prince Edward Island, and Newfoundland and Labrador.

6.             The Filer’s common shares, unsecured gold-linked notes and common share purchase warrants formerly traded on the Toronto Stock Exchange but were delisted effective as of the close of business on February 21, 2014.

7.             On January 14, 2014, the directors of the Filer approved the filing of a notice of intention to make a proposal and plan of reorganization under the Business Corporations Act (Ontario) and the Bankruptcy and Insolvency Act (Canada) (the “Proposal”).

8.             The Filer’s creditors met and accepted the Proposal and confirmed the appointment of a proposal trustee (the Proposal Trustee) on February 24, 2014.

9.             The Proposal was approved by an order of the Honourable Mr. Justice Wilton-Segal of the Ontario Superior Court of Justice (In Bankruptcy and Insolvency) dated March 13, 2014 (Court File No. CV14-10401-00CL).

10.          The implementation of the Proposal involved:

(a)           the consolidation of the Filer’s then outstanding common shares on the basis of 200 to 1;

(b)           the cancellation of all existing outstanding securities of the Filer other than the common shares, without payment or return of capital;

(c)           the issue of new common shares and new share purchase warrants to proven creditors; and

(d)           amendments to the Filer’s constating documents to reflect the foregoing.

11.          Effective March 23, 2014, the Proposal Trustee implemented the Proposal and caused the Filer to distribute to proven creditors as of that date an aggregate of 48,710,398 post-consolidation common shares and post-consolidation share purchase warrants to acquire up to 24,403,000 common shares.

12.          Subsequent to March 23, 2014, the Proposal Trustee continued to process claims from the Filer’s creditors to ensure those creditors were proven creditors for the purposes of the Proposal, and to determine the entitlement of such proven creditors to common shares and warrants of the Filer.

13.          The Ontario CTO has prevented the Proposal Trustee from causing the Filer to distribute common shares and warrants to those persons subsequently established to be proven creditors and entitled to participate under the Proposal.

14.          The Ontario CTO was issued due to the failure of the Filer to file its annual information form, audited annual financial statements, related management’s discussion and analysis and officer certifications (the Outstanding Filings) for the year ended December 31, 2013.

15.          Equivalent orders to the Ontario CTO (the Other Provinces CTOs) were issued by the securities regulatory authorities in British Columbia (April 29, 2014), Alberta (August 11, 2014) and Manitoba (May 14, 2014). The Filer is not subject to any other cease trade orders.

16.          The Filer filed the Outstanding Filings, other than its annual information form, on August 7, 2015, but has made no further continuous disclosure filings under applicable securities legislation.

17.          Pursuant to the terms of the Proposal, creditors of Filer the may continue to submit claims to the Proposal Trustee to be entitled to be considered as proven creditors. However no creditor has submitted a claim to the Proposal Trustee since May 1, 2014.

18.          As of the date hereof, an aggregate of 3,035,430 common shares and 1,420,111 warrants (the Remaining Securities) have not been distributed to 44 proven creditors (the Remaining Proven Creditors) who are entitled to receive such securities under the Proposal. There are 28 Remaining Proven Creditors resident in Ontario, entitled to receive 467,262 common shares and 164,136 warrants.

19.          The Filer proposes to rely on the prospectus exemption set out in section 2.11(a) of National Instrument 45-106 Prospectus Exempt Distributions in respect of the distribution of the Remaining Securities to the Remaining Proven Creditors in the Province of Ontario.

20.          The proposed distribution under the Proposal of the Remaining Securities to the Remaining Proven Creditors in Ontario cannot be completed without a partial revocation of the Ontario CTO.

21.          Other than the proposed distribution of the Remaining Securities to the Remaining Proven Creditors no further distributions of securities of the Filer will be made in the Province of Ontario unless further relief from the Ontario CTO is sought by the Filer.

22.          The Filer has applied for and expects to be granted, concurrently with this partial revocation order, a partial revocation of the cease trade order issued by the British Columbia Securities Commission.

23.          It is not necessary that any of the other Other Provinces CTOs be varied to permit the distribution of the Remaining Securities to the Remaining Proven Creditors.

24.          The Filer’s securities, including the Remaining Securities proposed to be distributed under the Proposal will remain subject to the Ontario CTO and the Other Provinces CTOs until such time as the Ontario CTO and the Other Provinces CTOs are fully revoked.

25.          The Filer’s SEDAR and SEDI profiles are up to date.

26.          Except for the continuous disclosure defaults since the issuance of the Ontario CTO, the Filer is not in default of any requirements of the Ontario CTO or the Act or the rules and regulations made pursuant thereto.

                AND UPON considering the Application and the recommendation of the staff of the Commission;

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

                IT IS ORDERED, pursuant to section 144 of the Act, that the Ontario CTO is partially revoked solely to permit the distribution of the Remaining Securities to the Remaining Proven Creditors of the Filer (including, for greater certainty, acts in furtherance of trades in the Remaining Securities) that are necessary for and are in connection with the completion of the Proposal provided that:

(a)           prior to the completion of the distribution of the Remaining Securities, each of the Remaining Proven Creditors:

(i)            receives a copy of the Ontario CTO,

(ii)           receives a copy of this Order, and

(iii)          receives written notice from the Filer, and provides a written acknowledgement to the Filer, that all of the Filer’s securities, including the Remaining Securities, will remain subject to the Ontario CTO until it is revoked, and that the granting of this partial revocation Order does not guarantee the issuance of a full revocation in the future;

(b)           the Filer undertakes to make available a copy of the written acknowledgement to staff of the Commission on request; and

(c)           this Order will terminate on the earlier of:

(i)            the completion of the distribution of the Remaining Securities; and

(ii)           90 days from the date hereof.

                DATED this 12th day of July, 2017.

“Jo-Anne Matear”

Manager, Corporate Finance

Ontario Securities Commission