The Ontario Securities Commission (OSC) has granted an exemption to a group of applicants, including Bank of Montreal (BMO) and its various subsidiaries, from certain trading restrictions during the period when BMO is acquiring Radicle Group Inc. This exemption is pursuant to section 5.1 of OSC Rule 48-501, which concerns trading during distributions, formal bids, and share exchange transactions.
The key points of the decision are as follows:
1. The applicants sought relief from trading restrictions imposed by section 2.2 of OSC Rule 48-501, which would otherwise limit their ability to trade shares of BMO (Shares) during the issuer-restricted period associated with the distribution of Shares as consideration for the acquisition of Radicle Group Inc.
2. The exemption applies to various entities within the BMO group, including asset managers, fund managers, plan facilitators, trustees, custodians, securities lending agents, restricted dealers, non-restricted dealers, and BMO itself, in relation to their respective roles and activities.
3. The exemption allows these entities to continue their ordinary course of business activities, such as managing client accounts, facilitating employee share ownership plans, providing custody services, conducting securities lending and borrowing, and engaging in market making and trading facilitation.
4. The exemption is conditional on the Shares meeting the requirements to be considered a highly liquid security at the time of the activities.
5. The decision is based on representations made by the applicants regarding their regulatory status, the nature of their business activities, and the potential impact of the trading restrictions on their operations and fiduciary duties.
6. The OSC determined that granting the exemption would not be prejudicial to the public interest.
The decision underscores the OSC’s ability to provide relief from its rules when it is satisfied that doing so would not harm the public interest and would allow entities to fulfill their business obligations and responsibilities effectively.