Exemption Orders (Discretionary)
EQUATORIAL ENERGY INC.
2001 BCSECCOM 140
Headnote
Mutual Reliance System for Exemptive Relief Applications – relief granted from certain insider reporting requirements of the legislation in connection with an acquisition of securities of the Applicant by insiders (directors and officers) of the Applicant pursuant to an “automatic securities purchase plan” as defined in proposed National Instrument 55-101 Exemption from Certain Insider Reporting Requirements.
Applicable British Columbia Provisions
Securities Act, R.S.B.C. 1996, c. 418, s. 91 (Insiders)
IN THE MATTER OF THE SECURITIES LEGISLATION OF THE PROVINCES OF BRITISH COLUMBIA, ALBERTA AND ONTARIO
AND
IN THE MATTER OF THE MUTUAL RELIANCE REVIEW SYSTEM FOR EXEMPTIVE RELIEF APPLICATIONS
AND
IN THE MATTER OF EQUATORIAL ENERGY INC.
MRRS DECISION DOCUMENT
1. WHEREAS the local securities regulatory authority or regulator (the "Decision Maker") in each of the provinces of British Columbia, Alberta and Ontario (the "Jurisdictions") has received an application from Equatorial Energy Inc. (the "Filer") for a decision under the securities legislation of the Jurisdictions (the "Legislation") that the requirements contained in the Legislation for an insider of a reporting issuer or the equivalent thereof to file insider reports disclosing the insider’s direct or indirect beneficial ownership of, or control or direction over, securities of the reporting issuer (the "Insider Reporting Requirement") shall not apply to the acquisition by insiders of the Filer of certain securities of the Filer pursuant to an automatic securities purchase plan of the Filer under certain conditions;
2. AND WHEREAS pursuant to the Mutual Reliance Review System for Exemptive Relief Applications (the "System"), the Alberta Securities Commission is the principal regulator for this application;
3. AND WHEREAS in this Decision Document the terms;
3.1 "automatic securities purchase plan" means a plan designated by a reporting issuer or equivalent to facilitate the acquisition of previously issued securities of the reporting issuer or equivalent by employees of the reporting issuer or equivalent where:
(a) the timing of acquisitions of securities, the number of securities acquired by each participant and the price paid for the securities are established by a procedure set out in the Plan; and
(b) the acquisitions of securities pursuant to the Plan are made by a trustee on the open market; and
3.2 "lump sum provision" means a provision of an automatic securities purchase plan which allows a director or senior officer to acquire securities pursuant to an optional lump-sum or cash payment provision;
4. AND WHEREAS the Filer has represented to the Decision Makers that:
4.1 the Filer is an independent energy company engaged in the acquisition, exploration and development of oil and gas properties in Western Canada and Indonesia, continued under the laws of the Province of Alberta, is a reporting issuer or equivalent under the Legislation and is not in default of any requirements of the Legislation;
4.2 the Filer’s head office is located in Calgary, Alberta;
4.3 the Filer is authorized to issue an unlimited number of common shares without nominal or par value and an unlimited number of preferred shares without nominal or par value, issuable in series, of which 19,164,935 Common Shares and 21,134,203 series 1 convertible preferred shares were issued and outstanding as at the date hereof. An aggregate of 1,875,000 common shares have been reserved for issuance pursuant to the Filer’s incentive share option plan dated May 18, 1999;
4.4 the Filer has established the employee share purchase plan (the "Plan") for certain of its directors, officers and employees, which Plan is an automatic securities purchase plan;
5. AND WHEREAS pursuant to the System this MRRS Decision Document evidences the decision of each Decision Maker (collectively, the "Decision");
6. AND WHEREAS each of the Decision Makers is satisfied that the test contained in the Legislation that provides the Decision Makers with the jurisdiction to make the decision has been met;
7. THE DECISION of the Decision Makers pursuant to the Legislation is that, subject to the restrictions set forth below, the Insider Reporting Requirement shall not apply to the insiders of the Filer with respect to the acquisition of common shares in the capital of the Filer pursuant to the Plan provided that:
7.1 each insider files a report, in the form prescribed for insider trading reports under the Legislation, disclosing each acquisition of securities under the Plan that has not been disclosed by or on behalf of the insider:
(a) for any securities acquired under the Plan which have been disposed of or transferred, within the time required by securities legislation for filing a report disclosing the disposition or transfer; and
(b) for any securities acquired under the Plan during a calendar year which have not been disposed of or transferred, within 90 days of the end of the calendar year;
7.2 the exemptive relief granted by this Decision shall not apply to the acquisition of securities of the Filer pursuant to a lump-sum provision of the Plan;
7.3 the exemptive relief granted by this Decision shall not apply to an insider that beneficially owns, directly or indirectly, voting securities of the Filer, or exercises control or direction over voting securities of the Filer, or a combination of both, carrying more than 10% of the voting rights attached to all outstanding voting securities of the Filer.
DATED at Calgary, Alberta on the 9th of January, 2001.
Mavis Legg, CA
Manager, Securities Analysis