Kermode Exploration Ltd. -- s. 144
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, 144.
IN THE MATTER OF
THE SECURITIES ACT,
R.S.O. 1990 C. S.5 AS AMENDED
(the "Act")
AND
IN THE MATTER OF
KERMODE EXPLORATION LTD.
(the "Applicant")
ORDER
(Section 144)
WHEREAS the securities of the Applicant are subject to a temporary cease trade order made by the Director dated May 6, 2008 pursuant to paragraph 2 of subsection 127(1) and subsection 127(5) of the Act, as extended by a further order made by the Director dated May 16, 2008 pursuant to paragraph 2 of subsection 127(1) of the Act (collectively, the "Cease Trade Order"), ordering that trading in the securities of the Applicant cease until the Cease Trade Order is revoked;
AND WHEREAS the Applicant has made an application to the Ontario Securities Commission (the "Commission") pursuant to subsection 144(1) of the Act (the "Application") for an order revoking the Cease Trade Order;
AND WHEREAS the Applicant has represented to the Commission as follows:
1. The Applicant, under the name Lease-Rite Corporation Inc., was incorporated pursuant to the Business Corporations Act (Ontario) on November 23, 1972. The Issuer filed Articles of Amendment, dated June 6, 2006, whereby it changed its name to Kermode Exploration Ltd.
2. The Issuer's registered and head office is located at 15 Toronto Street, Suite 600, Toronto, Ontario M5C 2E3.
3. The Issuer is a reporting issuer under the Act. The Issuer is not a reporting issuer or equivalent in any other jurisdiction in Canada.
4. The Issuer has no securities, including debt securities, that are currently listed or quoted on any exchange or market in Canada or elsewhere.
5. The Applicant's authorized capital consists of an unlimited number of common shares and an unlimited number of preference shares, of which 9,360,080 common shares and nil preference shares are issued and outstanding as fully paid and non-assessable shares.
6. The Cease Trade Order was issued as a result of the failure of the Applicant to file its audited annual financial statements and management's discussion and analysis relating to the audited financial statements for the year ended December 31, 2007, on or before the filing deadline of April 29, 2008, as required by section 4.2 of National Instrument 51-102 -- Continuous Disclosure Obligations.
7. The Applicant's failure to file financial statements was a result of financial distress.
8. On December 8, 2009, the Applicant filed the following disclosure documents with the Commission via SEDAR:
(a) Audited Annual Financial Statements for the years ended December 31, 2007 and December 31, 2008;
(b) Management's Discussion and Analysis for the annual periods referred to in subparagraph (a) above;
(c) Unaudited Interim Financial Statements for the three months ended March 31, 2008, the six months ended June 30, 2008 and the nine months ended September 30, 2008;
(d) Management's Discussion and Analysis for the interim periods referred to in subparagraph (c) above;
(e) Unaudited Interim Financial Statements for the three months ended March 31, 2009, the six months ended June 30, 2009 and the nine months ended September 30, 2009; and
(f) Management's Discussion and Analysis for the interim periods referred to in subparagraph (e) above;
(g) Certificates required by National Instrument 52-109 -- Certification of Disclosure in Issuers' Annual and Interim Filings signed by both the Chief Executive Officer and a director acting in the capacity of the Chief Financial Officer certifying the annual filings for each of the years ended December 31, 2007 and December 31, 2008 and the interim filings for the three months ended March 31, 2008, the six months ended June 30, 2008, the nine months ended September 30, 2008, the three months ended March 31, 2009, the six months ended June 30, 2009; and the nine months ended September 30, 2009.
9. On February 26, 2010, the Applicant re-filed its management's discussion and analysis and certificates for the interim period ended September 30, 2009. The management's discussion and analysis was re-filed with additional disclosure relating to liquidity and capital resources, related party transactions and international financial reporting standards.
10. The Applicant has filed an undertaking with the Commission that it will hold an annual meeting of shareholders within three months of the date of this Order.
11. Other than the Cease Trade Order, the Applicant has not previously been subject to a cease trade order by the Commission.
12. The Applicant is up-to-date will all of its other continuous disclosure obligations and has paid outstanding participating fees, filing fees and late fees associated with those obligations owing to the Commission in connection with the disclosure documents referred to in paragraph 8 above and has filed all of the forms associated with such payments.
13. The Issuer is not, to its knowledge, in default of any requirements of the Cease Trade Order, the Act or the rules and regulations made pursuant thereto, including NI 43-101 -- Standards of Disclosure for Mineral Projects.
14. The Applicant's SEDAR and SEDI profiles are up-to-date.
15. The Applicant 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.
16. Upon the issuance of this Order, the Issuer will issue a press release announcing the revocation of the Cease Trade Order of the Issuer. The Issuer will concurrently file the press release and material change report on SEDAR.
AND UPON considering the Application and the recommendation of staff of the Commission;
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 at Toronto, Ontario on this 3rd day of March, 2010.