Richards Oil & Gas Limited -- s. 144

Headnote

Section 144 -- Application for revocation of cease trade order -- issuer subject to cease trader as a result of failure to file financial statements -- issuer has made a separate application to not be a reporting issuer in all of the jurisdictions in which it is currently a reporting issuer -- full revocation granted effective as of the date the issuer is determined to not be a reporting issuer.

Applicable Legislative Provisions

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, CHAPTER S.5, AS AMENDED

(the Act)

AND

IN THE MATTER OF

RICHARDS OIL & GAS LIMITED

ORDER

(Section 144)

WHEREAS the securities of Richards Oil & Gas Ltd. (the Filer) was subject to a temporary cease trade order made by the Director dated May 14, 2010 under paragraph 2 of subsection 127(1) and subsection 127(5) of the Act and a further cease trade order issued by the Director on May 26, 2010 pursuant to subsection 127(1) of the Act (together the Ontario CTO) directing that trading in the securities of the Filer cease until further ordered 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 for a revocation of the Ontario CTO;

AND WHEREAS the Filer has represented to the Commission that:

1. The Filer was incorporated under the Business Corporations Act (Alberta) on May 18, 2004.

2. The Filer's head office is located in Calgary, Alberta.

3. The Filer is a reporting issuer in each of British Columbia, Alberta, Saskatchewan, Ontario, Nova Scotia and New Brunswick (the Jurisdictions).

4. The authorized share capital of the Filer consists of an unlimited number of voting class A common shares (Class A Shares) and an unlimited number of convertible non-voting class B common shares (Class B Shares) of which 600,000 Class A Shares and 500,000 Class B Shares are issued and outstanding as of the date hereof.

5. The outstanding securities of the Filer, including debt securities, are beneficially owned, directly or indirectly, by fewer than 15 security holders in total in Canada.

6. The former common shares of the Filer (the Common Shares) were delisted from trading on the TSX Venture Exchange on July 9, 2010 (the Delisting) and, accordingly, no securities of the Filer are traded on a marketplace as defined in National Instrument 21-101 Marketplace Operation.

7. The Filer is not in default of any of its obligations as a reporting issuer as of the date hereof, other than the obligation to file: (a) its annual audited financial statements, managements' discussion and analysis and certification of annual filings for the year ended December 31, 2009 (the Annual Filings); (b) its interim unaudited financial statements, interim managements' discussion and analysis and certification of interim filings for the interim periods ended March 31, June 30 and September 30, 2010; (c) its oil and gas disclosure prescribed by National Instrument 51-101 Standards of Disclosure for Oil and Gas Activities for the year ended December 31, 2009; (d) the applicable form under OSC Rule 13-502 Fees in respect of its year ended December 31, 2009; and (e) the notice under section 11.2(b) National Instrument 51-102 Continuous Disclosure Obligations with respect of the Delisting.

8. The Ontario CTO was issued due to the failure of the Filer to file its Annual Filings.

9. The Filer is also subject to cease trade orders (the Other CTOs) in British Columbia and Alberta for its failure to file required filings under applicable securities laws. The Filer has applied for and expects to be granted concurrently with this Application, full revocations of the Other CTOs (the Other Full Revocation Orders).

10. The Filer has applied for and expects to be granted concurrently with this Application and the Other Full Revocation Orders, a decision that the Filer has ceased to be a reporting issuer in each of the Jurisdictions (the Ceasing to be a Reporting Issuer Decision) other than British Columbia where the Filer has voluntarily surrendered its reporting issuer status under British Columbia Instrument 11-502 Voluntary Surrender of Reporting Issuer Status.

11. On May 5, 2010, the Filer was granted protection from its creditors under the Bankruptcy and Insolvency Act (the BIA). The protection afforded by the BIA was extended several times pursuant to orders granted by the Court of Queen's Bench in the Judicial Centre of Calgary (the Court). The purpose of seeking protection from creditors under the BIA was to allow the Filer time to file with the Official Receiver a proposal to effect a compromise and arrangement of all claims of the Filer's creditors against the Filer.

12. On September 2, 2010, the Filer filed a proposal (the Proposal) with the Official Receiver in accordance with the BIA, naming Alger & Associates Inc. (the Trustee) as the Proposal trustee.

13. On September 24, 2010, the Proposal was approved by the Filer's creditors as required under the BIA.

14. On October 22, 2010, the Proposal was approved by the Court as required under the BIA.

15. On November 30, 2010, an extension for the completion date of the Proposal (to December 30, 2010) was approved by the Filer's creditors.

16. On December 20, 2010 and December 23, 2010, in accordance with the Proposal, the Filer received partial revocation orders (the Partial Revocation Orders) from the Alberta Securities Commission and the Commission, respectively, in respect of the following trades: (a) the issuance of 600,000 Class A Shares to arm's length investors at a price of $1.00 per Class A Share for gross proceeds of $0.6 million (the Private Placement); and (b) the issuance of 500,000 Class B Shares to the four (4) largest unsecured creditors of the filer and the Office of the Superintendent of Bankruptcy (collectively the Class B Shareholders).

17. The Filer has satisfied every condition of the Partial Revocation Orders.

18. On December 22, 2010, in accordance with the Proposal, the Filer filed articles of reorganization to: (a) create the Class A Shares and the Class B Shares; and (b) add a redemption feature to the Common Shares.

19. On December 22, 2010, in accordance with the Proposal, the Filer filed articles of reorganization to: (a) cancel the issued and outstanding Common Shares for no consideration (which had the effect of cancelling the issued and outstanding options to purchase Common Shares); and (b) add a restriction on the transfer of the securities of the Filer.

20. On December 30, 2010, in accordance with the Proposal, the Filer (a) provided a cheque in the amount of $210,000.00 from the net proceeds of the Private Placement to the Trustee for distribution to the creditors approved for payment in accordance with the Proposal; (b) provided a cheque in the amount of $13,636.83 from the net proceeds of the Private Placement to the Trustee in satisfaction of the Trustee's outstanding fees; and (c) appointed a new board of directors.

21. On December 30, 2010 and December 31, 2010, in accordance with the Proposal and as permitted by the Partial Revocation Orders, the Filer: (a) issued 600,000 Class A Shares to seven (7) arm's length investors at a price of $1.00 per Class A Share for gross proceeds of $0.6 million; and (b) issued 500,000 Class B Shares to the Trustee in Trust for distribution to the Class B Shareholders.

22. On January 6, 2011, the Trustee confirmed that the Proposal had been fully performed as of December 30, 2010.

23. The claims of a secured creditor and certain operating creditors were not affected by the Proposal.

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 revoked.

DATED February 25th, 2011.