The Securities Commission has granted an exemption to the Filer, Graham Income Trust, from certain requirements of National Instrument 62-104 Take-Over Bids and Issuer Bids and Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions. This exemption pertains to the Filer’s proposed purchase of its outstanding trust units through a modified Dutch auction issuer bid.
Key facts include:
– Graham Income Trust is an unincorporated mutual fund trust established in Alberta.
– The trust is not a reporting issuer and its securities are not traded on any public marketplace.
– The trust’s capital consists of an unlimited number of units, with 4,694,552 units issued and outstanding as of a specified date.
– Units have been issued to Eligible Investors under specific exemptions, and all unit holders are parties to a unanimous unitholders’ agreement that restricts the transfer of units.
– The trust wishes to acquire units from certain investors, including Exempt Spouses of Eligible Investors, who do not qualify under Exempt Bid provisions.
The reasoning for the decision includes:
– The trust has a policy allowing for the redemption of units with quarterly limits and a queue system for redemptions exceeding the budget.
– The trust’s trustees believe that offering additional funds for redemptions at a price below the prescribed redemption price will be beneficial for both the trust and the tendering unitholders.
The outcome is that the Securities Commission has approved the exemption, allowing the trust to proceed with its modified Dutch auction issuer bid without adhering to the standard issuer bid requirements. This decision is based on the belief that the exemption is in the best interests of the trust and its unitholders and meets the legislative test for such an exemption.
The relevant laws and regulations underpinning the outcome include:
– National Instrument 62-104 Take-Over Bids and Issuer Bids, Part 2; s. 6.1.
– Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions, Part 2; s 9.1.
The Alberta Securities Commission, as the principal regulator, has made this decision, which also applies to Ontario by virtue of the Passport System.