MedMira Inc. and Cornell Capital Partners, LP - MRRS Decision
Headnote
Mutual Reliance Review System for Exemptive Relief Applications -- variation of a previous decision to permit the use of a short form prospectus rather than a long form prospectus for a distribution of securities by an issuer by way of an equity line of credit - the previous decision granted relief to the issuer and equity line purchaser from certain registration requirements, certain disclosure requirements, prospectus delivery requirements, certain withdrawal rights and from the underwriter certificate requirement.
Applicable Ontario Statutory Provisions
Securities Act, R.S.O. 1990, c. S.5, as am., s. 144.
November 21, 2006
IN THE MATTER OF
THE SECURITIES LEGISLATION OF
ALBERTA, BRITISH COLUMBIA, NOVA SCOTIA
AND ONTARIO
(the Jurisdictions)
AND
IN THE MATTER OF
THE MUTUAL RELIANCE REVIEW SYSTEM
FOR EXEMPTIVE RELIEF APPLICATIONS
AND
IN THE MATTER OF MEDMIRA INC. (MedMira)
AND CORNELL CAPITAL PARTNERS, LP
(Cornell, and collectively with MedMira, the Filer)
MRRS DECISION DOCUMENT
Background
The local securities regulatory authority or regulator (the Decision Maker) in each of the Jurisdictions has received an application from the Filer for a decision under the securities legislation of the Jurisdictions (the Legislation) varying a MRRS decision document of the Decision Makers dated November 18, 2005 (the Original Decision) in favour of the Filer which granted an exemption from certain registration and prospectus requirements concerning the ongoing distribution of MedMira common shares to Cornell (the Distributions) in connection with an equity line arrangement between MedMira and Cornell.
Under the Mutual Reliance Review System for Exemptive Relief Applications:
(a) the Nova Scotia Securities Commission is the principal regulator for this application; and
(b) this MRRS decision document evidences the decision of each Decision Maker.
Interpretation
Defined terms contained in National Instrument 14-101 -- Definitions have the same meaning in this decision unless they are defined in this decision.
Representations
This decision is based on the following facts represented by the Filer:
1. MedMira is a corporation governed by the Business Corporations Act (Alberta) having its registered office in Calgary, Alberta, and its head office in Halifax, Nova Scotia. MedMira is a reporting issuer not in default under the Legislation.
2. Under the Original Decision, exemptions were granted that certain registration requirements under the Legislation do not apply to Cornell and that certain prospectus requirements under the Legislation do not apply to MedMira and Cornell in respect of the Distributions. MedMira was issued a receipt for a (final) long-form prospectus on November 21, 2005 for the Distributions.
3. The Original Decision requires MedMira to file further (final) long-form prospectuses with the Decision Makers in order to qualify the Distributions.
4. Since the Original Decision, MedMira has become eligible under National Instrument 44-101 -- Short Form Prospectus Distributions to file a prospectus in the form of a short-form prospectus. MedMira filed a (preliminary) short-form prospectus in connection with the Distributions on October 20, 2006.
5. The Filer wishes to give effect to the Distributions by filing subsequent (final) short-form prospectuses. The Filer also wishes to continue to rely on the relief granted in the Original Decision. Accordingly, it is necessary to vary the Original Decision so as to permit MedMira, in its discretion, to file a (final) prospectus rather than a (final) long-form prospectus.
Decision
Each of the Decision Makers is satisfied that the test contained in the Legislation that provides the Decision Maker with the jurisdiction to make the decision has been met.
The decision of the Decision Makers under the Legislation is that the Original Decision is varied by deleting from paragraph 10 the words "long-form" appearing in line 9, such that paragraph 10 now reads as follows:
"the MedMira Shares to be issued during the first 12 months pursuant to Draw Downs will be qualified by filing a (final) long-form prospectus (the First Prospectus) with the Decision Makers. Immediately following issuance of all receipts for the First Prospectus, the obligations of Cornell under the Subscription Agreement will become unconditional. After the end of the first 12 month period, and after the end of each succeeding 12 month period, if additional Draw Downs may be made pursuant to the Subscription Agreement, the MedMira Shares to be issued pursuant to such Draw Downs will be qualified by filing a further (final) prospectus (each, a Subsequent Prospectus) with the Decision Makers (the First Prospectus and each Subsequent Prospectus are collectively referred to as the Prospectus);"