BCN 2001/12 - Takeover Bid Amendments [BCN - Rescinded]

Amendments to the takeover bid provisions of the Securities Act and the Securities Rules, commonly known as the “Zimmerman Amendments”, will take effect in British Columbia on March 31, 2001.  The Commission is publishing the amendments to the Securities Act (B.C. Reg. 31/2001) and the amendments to the Securities Rules (B.C. Reg. 38/2001) containing the Zimmerman Amendments and Canadian Securities Administrators Notice 62-301, which provides background and explains the status of the Zimmerman Amendments in other Canadian jurisdictions.

The Commission published the Securities Act amendments on June 19, 1998 (NIN#98/28) and published for comment the related proposed amendments to the Securities Rules on August 21, 1998 (NIN#98/51).  No comments were received on the proposed amendments to the Securities Rules concerning takeover bids. 

DATED at Vancouver, British Columbia, on March 1, 2001.

Douglas M. Hyndman
Chair

Ref: B.C. Reg. 31/2001
 B.C. Reg. 38/2001
 CSA Notice 62-301
 NIN#98/28
 NIN#98/51

This Notice may refer to other documents.  These documents can be found at the B.C. Securities Commission public website at www.bcsc.bc.ca in the Commission Documents database or the Historical Documents database.

Amendments to the Securities Act  R.S.B.C. 1996, c.418

27 Section 105 is amended

(a) by repealing paragraph (d) and substituting the following:

(d) Withdrawal. -- Securities deposited pursuant to the bid may be withdrawn by or on behalf of a depositing security holder

(i) at any time before the securities have been taken up by the offeror,

(ii) at any time before the expiration of the prescribed period from the date of a notice of change or variation under section 108, and

(iii) if the securities have not been paid for by the offeror within the prescribed period after having been taken up; ,

(b) in paragraph (j) by striking out "and in any event not more than 3 days," and substituting "and in any event not later than the prescribed period,",

(c) in paragraph (k) by striking out "within 10 days of" and substituting "not later than the prescribed period after",

(d) in paragraph (l) by striking out "and pays for", and

(e) by adding the following paragraph:

(1.1) Further regarding bid extensions. -- Despite paragraph (l), if the offeror waives any terms or conditions of a bid and extends the bid in circumstances where the rights of withdrawal conferred by paragraph (d) (ii) are applicable, the bid must be extended without the offeror first taking up the securities which are subject to those rights of withdrawal; .

28 Section 110 is repealed and the following substituted:

Commencement of bid and delivery

110 (1) A take over bid may be commenced in accordance with either subsection (2) or (7).

(2) A take over bid may, and an issuer bid must, be commenced by delivering the bid to the holders of securities referred to in section 105 (a) in accordance with subsection (6) of this section.

(3) If a bid is commenced under subsection (2), the bid must be filed and, in the case of a take over bid, delivered to the offeree issuer's principal office, on the day the bid is delivered under subsection (2) or as soon as practicable after that.

(4) A notice of change or variation in respect of a bid must be filed and, in the case of a take over bid, delivered to the offeree issuer's principal office, on the day the notice of change or variation is delivered to holders of securities of the offeree issuer or as soon as practicable after that.

(5) Every directors' circular and every individual director's or officer's circular or any notice of change in relation to it that is delivered to holders of securities of an offeree issuer must be filed, and must be delivered to the offeror's principal office, on the day the directors' circular or individual director's or officer's circular or the notice of change is delivered to the holders of securities of the offeree issuer, or as soon as practicable after that.

(6) A take over bid or issuer bid, a take over bid circular, an issuer bid circular, a directors' circular, an individual director's or officer's circular and every notice of change or variation in the bid or circular must be

(a) mailed by prepaid first class mail to the intended recipient, or

(b) delivered to the intended recipient by personal delivery or in such other manner as the executive director may approve,

and any bid, circular or notice so mailed or delivered is deemed to have been delivered and, subject to subsections (8) and (9), is deemed conclusively for the purposes of this Part and the regulations to have been dated as of the date on which it was so mailed or delivered to all or substantially all of the persons entitled to receive it.

(7) An offeror may commence a take over bid by publishing an advertisement containing a brief summary of the bid in at least one major daily newspaper of general and regular paid circulation in British Columbia, or by disseminating the advertisement in a prescribed manner, if

(a) concurrently with, or before, the earlier of the date of first publication or first dissemination of the advertisement, the offeror, or a person acting on its behalf, files and delivers the bid to the offeree issuer's principal office and files the advertisement,

(b) concurrently with, or before, the earlier of the date of first publication or first dissemination of the advertisement, the offeror, or a person acting on its behalf, requests from the offeree issuer a list of the holders of securities referred to in section 105 (a), and

(c) not later than the prescribed period after the offeror's receipt of the list of the holders of securities referred to in section 105 (a), the bid is delivered to those holders of securities in accordance with subsection (6) of this section.

(8) If a take over bid is commenced in accordance with subsection (7), the bid is deemed conclusively for the purposes of this Part and the regulations to have been dated as of the earlier of the date of first publication or first dissemination of the advertisement referred to in subsection (7).

(9) If a take over bid has been advertised in accordance with subsection (7), and the offeror, or a person acting on its behalf, has complied with paragraphs (a) and (b) of that subsection but has not yet delivered the bid under paragraph (c) of that subsection, a change or variation to it that is advertised in at least one major daily newspaper of general and regular paid circulation in British Columbia, or disseminated in a manner prescribed under subsection (7), is deemed conclusively for the purposes of this Part and the regulations to have been dated as of the earlier of the date of first publication or first dissemination of the advertisement if

(a) the advertisement contains a brief summary of the change or variation,

(b) concurrently with, or before, the earlier of the date of first publication or first dissemination of the advertisement, the offeror, or a person acting on its behalf, files and delivers the notice of change or variation to the offeree issuer's principal office and files the advertisement, and

(c) the offeror, or a person acting on its behalf, subsequently delivers the bid, and delivers the notice of change or variation, in accordance with subsection (6) and before the expiration of the period prescribed under subsection (7) (c).

(10) If an offeror, or a person acting on its behalf, satisfies the requirements of subsection (9), the notice of change or variation is not required to be filed and delivered under subsection (4).

Amendments to the Securities Rules Relating to Prescribed Time Periods for the Conduct of Take Over Bids

Effective March 31, 2001, the Securities Rules, B.C. Reg. 194/97, are amended by repealing section 180 and substituting the following:

Prescribed time periods

180. For the purpose of

(a) section 105 (b) and (c) of the Act, the prescribed period is 35 days from the date of the bid,  

(b) section 105(d)(ii) of the Act, the prescribed period from the date of a notice of change or variation under section 108 of the Act is 10 days,

(c) section 105(d)(iii) of the Act, the prescribed period is 3 business days after having been taken up,

(d) section 105(i) of the Act, the prescribed period after the expiry of the bid is 10 days,

(e) section 105(j) of the Act, the prescribed period after the taking up of the securities deposited under the bid is 3 business days.

(f) section 105(k) of the Act, the prescribed period after the deposit of the securities under the bid is 10 days,

(g) section 108(5) of the Act, the prescribed period after the notice of variation has been delivered is 10 days,

(h) section 109(1) of the Act, the prescribed period after the date of the bid is 15 days,

(i) section 109(5) of the Act, the prescribed number of days before the scheduled expiry of the period during which securities may be deposited under the bid is 7 days, and

(j) section 110(7)(c) of the Act, the prescribed period after the offeror’s receipt of the list of the holders of securities referred to in section 105(a) is 2 business days.