21-502 (Blanket Order) - Exemption Order for Issuers of Alpha Exchange Inc. Securities

Securities Act
R.S.P.E.I. 1988, Cap-S-3.1

Document Type: Blanket Order
Document No: 21-502
Subject: An order exempting issuers whose securities are listed on the Alpha Venture Plus marketplace operated by Alpha Exchange Inc. from certain requirements of securities legislation
Effective Date: March 30, 2012

Blanket Order 21-502

An order exempting issuers whose securities are listed on the Alpha Venture Plus marketplace operated by Alpha Exchange Inc. from certain requirements of securities legislation Order (Section 16)

Whereas:

1. The Ontario Securities Commission rendered an order recognizing Alpha Exchange Inc. (“Alpha Exchange”) and Alpha Trading Systems Limited Partnership (“Alpha LP”) as an exchange on December 8, 2011 (“Recognition Order”);
2. The Autorité des marches financiers rendered order n° 2012-PDG-0024 exempting Alpha Exchange and Alpha LP from the requirement to be recognized as a stock exchange, an exchange or a self-regulatory organization on March 13, 2012 (“Exempting Order”), which evidences the decision of the Superintendent of Securities (the “Superintendent”);
3. It is expected that the operations of Alpha ATS Limited Partnership (“Alpha ATS”) will be legally transferred to Alpha Exchange;
4. The Recognition Order will be effective as at the later of: (a) February 1, 2012; or (b) the date the operations of Alpha ATS have been legally transferred to Alpha Exchange;
5. The Exempting Order will be effective as at the date the operations of Alpha ATS have been legally transferred to Alpha Exchange;
6. Alpha Exchange intends to operate two marketplaces, referred to as “Alpha Venture Plus” and “Alpha Main”;
7. Prince Edward Island securities laws applicable to issuers may vary depending on which marketplace or exchange the issuer’s securities are listed or quoted;
8. It is appropriate that Prince Edward Island securities laws applicable to issuers whose securities will be listed on the Alpha Venture Plus marketplace (individually, an “Alpha Venture Plus Issuer” and collectively the “Alpha Venture Plus Issuers”) be the same as that applicable to issuers whose securities are listed on the TSX Venture Exchange that are TSX Venture Tier 1 issuers;
9. The definition of short form eligible exchange provided in National Instrument 44-101 Short Form Prospectus Distributions and in any other rule where reference is made to this definition, refers to each of the Toronto Stock Exchange (“TSX”), Tier 1 and Tier 2 of the TSX Venture Exchange and the Canadian National Stock Exchange;
10. One of the requirements applicable to an issuer who meets the definition of established issuer provided in National Policy 46-20 1 Escrow for Initial Public Offerings is that an issuer, after its initial public offering (“IPO”), have securities listed on the TSX and not be classified by the TSX as an exempt issuer or have securities listed on the TSX Venture Exchange and be a TSX Venture Tier 1 issuer;
11. The above-cited definitions or requirements currently do not refer to the marketplaces that Alpha Exchange intends to operate;
12. It may be appropriate to revise Prince Edward Island securities laws to include the Alpha Main and the Alpha Venture Plus marketplaces, where applicable, and until this is done, it is important that the Alpha Venture Plus Issuers comply with, and benefit from, requirements that are fair and equal when compared to other issuers that have securities listed on comparable stock exchanges;
13. The Superintendent may, pursuant to section 16 of the Act, exempt a person or company or a category of persons or companies from any or all of the provisions of the Act or regulations, where he or she is of the opinion that it is not prejudicial to the public interest; and
14. The Superintendent is satisfied that it is not prejudicial to the public interest to do so.

It is ordered, pursuant to subsection 16 of the Act, that each Alpha Venture Plus Issuer is exempt from the requirements listed in Schedule A, on the condition that it complies with the provisions or requirements listed in Schedule B.

This exemption order will come into force, become effective and apply to an Alpha Venture Plus Issuer as at the date at which all of the following conditions are met: (i) the Exempting Order has come into force and became effective; and (ii) the securities of the Alpha Venture Plus Issuer are listed on the Alpha Venture Plus marketplace.

Dated at Charlottetown, Prince Edward Island, this 30th day of March, 2012.

Schedule A

Exemptions from the following requirements:

1. The requirement of subsection 2.2(e) of National Instrument 44-101 Short Form Prospectus Distributions (“NI 44-101”) that the securities of an issuer whose equity securities will be listed on the Alpha Venture Plus marketplace (“Alpha Venture Plus Issuer”) be listed and posted for trading on a short form eligible exchange, within the meaning of NI 44-10 1, if the Alpha Venture Plus Issuer’s equity securities are listed on the Alpha Venture Plus marketplace;
2. The requirement of subsection 2.2(1) of National Instrument 44-102 Shelf Distributions that an Alpha Venture Plus Issuer be qualified under section 2.2 of NI 44-101 to file a preliminary short form prospectus that is a preliminary base shelf prospectus, on the condition that the Alpha Venture Plus Issuer meet all the requirements of such provision except for the requirement that its equity securities be listed for trading on a short form eligible exchange, within the meaning of NI 44-101, if the Alpha Venture Plus Issuer’s equity securities are listed on the Alpha Venture Plus marketplace; and
3. All provisions contained in National Policy 46-20 1 Escrow for Initial Public Offerings that apply to an Alpha Venture Plus Issuer as a result of the fact that it meets the definition of emerging issuer, within the meaning of that Policy.

Schedule B

1. All the provisions contained in National Policy 46-201 Escrow for Initial Public Offerings as if the Alpha Venture Plus Issuer was considered an established issuer, within the meaning of that Policy; and
2. The requirement of subsection 11.2(b) of National Instrument 51-102 Continuous Disclosure Obligations to file a change of status report when the Alpha Venture Plus Issuer’s securities become listed on the Alpha Main marketplace operated by Alpha Exchange Inc. or any other exchange considered as a non-venture exchange.