47-501 - Exemption for solicitations of expressions of interest [BCI - Rescinded]

Concurrently Published:

• BCN 2006/09 - BC Instrument 47-501 Exemption for solicitations of expressions of interest [BCN - Lapsed]

The Commission, considering it would not be prejudicial to the public interest to do so, orders that, effective May 17, 2006, the attached BC Instrument 47-501 entitled Exemption for solicitations of expressions of interest is made.

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(This part is for administrative purposes only and is not part of the Order)

Authority under which Order is made:
Act and sections: Section 76 of the Securities Act
Other (specify):

BC Instrument 47-501

Exemption for solicitations of expressions of interest

Order under Section 76 of the Securities Act

Interpretation

1.     In this instrument,

“over-allocation position” means the amount by which

(a)       the total number or principal amount of securities that are the subject of offers to purchase received by all underwriters of a distribution 

exceeds

(b)       the total number or principal amount of securities that all underwriters have agreed to purchase under an enforceable agreement with the issuer; 

“over-allotment option” means a right granted to the underwriters by an issuer or a selling security holder in connection with the distribution of securities under a short form prospectus to acquire additional securities of the same class as was distributed under the short form prospectus; and

“short form prospectus” means a short form prospectus filed under National Instrument 44-101 Short Form Prospectus Distributions.

Exemption

2.     Section 61 does not apply to soliciting expressions of interest before the filing of a preliminary short form prospectus for securities to be issued under an over-allotment option, provided that

(a)     the issuer satisfies the conditions in paragraphs 7.1(a) to (e) of National Instrument 44-101 Short Form Prospectus Distributions, and

(b)     the over-allotment option

(i)     is granted for the purposes of covering the underwriters’ over-allocation position,

(ii)    expires not more than 60 days after the date of closing of the distribution, and

(iii)   is limited to the lesser of

(A)    the over-allocation position determined as at the closing of the distribution, and

(B)    15% of the number or principal amount of the securities qualified for the distribution, other than the securities issuable on the exercise of the over-allotment option.