Ionic Brands Inc.
Headnote
Application by an issuer for a revocation of a cease trade order issued by the Commission -- cease trade order issued because the issuer 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.
Applicable Legislative Provisions
Securities Act, R.S.O. 1990, c. S.5, as am., s. 144.
December 11, 2020
IONIC BRANDS INC.
REVOCATION ORDER
UNDER THE SECURITIES LEGISLATION OF ONTARIO (the Legislation)
Background
1. Ionic Brands Inc. (the Issuer) is subject to a failure-to-file cease trade order (the FFCTO) issued by the Ontario Securities Commission (the Principal Regulator) on June 22, 2020.
2. The Issuer has applied to the Principal Regulator under National Policy 11-207 Failure-to-File Cease Trade Orders and Revocations in Multiple Jurisdictions (NP 11-207) for an order revoking the FFCTO.
Interpretation
3. Terms defined in National Instrument 14-101 Definitions or in NP 11-207 have the same meaning if used in this order, unless otherwise defined.
Representations
4. This decision is based on the following facts represented by the Issuer:
(a) The Issuer was incorporated under the laws of the province of Ontario on October 9, 2012 and continued under the laws of the province of British Columbia on July 3, 2013;
(b) The Issuer's head office is located at 1142 Broadway, Suite 300, Tacoma, Washington, USA, 98402;
(c) The Issuer is a reporting issuer in the provinces of Ontario, British Columbia and Alberta (the Reporting Jurisdictions) and Ontario is deemed the Principal Regulator;
(d) The Issuer's authorized share capital consists of an unlimited number of common shares without par value, an unlimited number of series A non-voting preferred shares, an unlimited number of series B non-voting preferred shares and an unlimited number of series C non-voting preferred shares;
(e) The Issuer's common shares are listed for trading on the Canadian Stock Exchange (CSE) under the symbol "IONC", quoted on the OTC Markets under the symbol "IONKF" and listed on the Frankfurt Stock Exchange under the symbol "1B3". Other than as outlined in the preceding sentence, the common shares are not listed, quoted or traded on any other exchange, marketplace or other facility for bringing together buyers and sellers in Canada or elsewhere;
(f) On June 22, 2020, the Ontario Securities Commission issued the FFCTO for the Company's failure to file, within the required timeframe:
i. the annual audited financial statements for the year ended December 31, 2019, as required under National Instrument 51-102 Continuous Disclosure Obligations (NI 51-102);
ii. annual management's discussion and analysis for the year ended December 31, 2019, as required under NI 51-102; and
iii. certifications of the annual filings for the year ended December 31, 2019 as required by National Instrument 52-109 Certification of Disclosure in Issuers' Annual and Interim Filings (NI 52-109)
(collectively, the "Outstanding Filings");
(g) The Issuer's common shares were suspended from trading on the CSE on June 22, 2020. The Issuer intends to apply for this suspension to be lifted as soon as the FFCTO is revoked;
(h) Since the issuance of the FFCTO, the Issuer has filed in the Reporting Jurisdictions the Outstanding Filings as required by NI 51-102 and NI 52-109;
(i) The Issuer is: (i) up-to-date with all of its continuous disclosure obligations; (ii) not in default of any requirements under applicable securities legislation or the rules and regulations made pursuant thereto in any of the Reporting Jurisdictions, except for the existence of the FFCTO; and (iii) not in default of any of its obligations under the FFCTO;
(j) The Issuer's issuer profile on the System for Electronic Document Analysis and Retrieval (SEDAR) and issuer profile supplement on the System for Electronic Disclosure by Insiders (SEDI) are current and accurate;
(k) The Applicant has paid all outstanding activity, participating and late filing fees that are required to be paid and has filed all forms associated with such payments;
(l) Since the issuance of the FFCTO, there have not been any material changes in the business, operations or affairs of the Issuer that have not been disclosed by news release and/or material change report filed on SEDAR;
(m) Other than the FFCTO, the Issuer has not been subject to a cease trade order issued by any securities regulatory authority;
(n) The Issuer has provided the Principal Regulator with a written undertaking to hold an annual meeting of shareholders within 90 days of the revocation of the FFCTO and will prepare a management information circular in accordance with Form 51-102F5 Information Circular, which will be sent to shareholders and filed on SEDAR in accordance with NI 51-102; and
(o) Upon the issuance of this revocation order the Issuer will issue a news release announcing the revocation of the FFCTO, and concurrently file the news release on SEDAR.
Order
5. The Principal Regulator is satisfied that the order to revoke the FFCTO meets the test set out in the Legislation for the Principal Regulator to make the decision.
6. The decision of the Principal Regulator under the Legislation is that the FFCTO is revoked.
"Jo-Anne Matear"
Manager, Corporate Finance Branch
Ontario Securities Commission