The Ontario Securities Commission granted an exemption to Medical Facilities Corporation (the Filer) from the requirement under subsection 2.32(4) of National Instrument 62-104 Take-Over Bids and Issuer Bids (NI 62-104). This requirement stipulates that an issuer must take up all securities deposited and not withdrawn before extending an issuer bid, provided all terms and conditions have been met or waived.
The Filer is conducting an issuer bid through a modified Dutch auction to purchase a portion of its common shares. If the bid is undersubscribed by the expiration date, and the market price is not higher than the proposed purchase price range, the Filer may wish to extend the bid. However, the calculation of the purchase price per share requires knowledge of all tenders, which would not be possible if shares had to be taken up before any extension.
The exemption is granted subject to conditions, including that the Filer must take up and pay for, or deal with, the deposited shares as outlined in the Circular, remain eligible for the Liquid Market Exemption, issue a press release announcing the exemption within one business day, and comply with Regulation 14E under the Exchange Act concerning the offer. The Filer’s board believes the bid is in the best interest of the company and its shareholders, offering an efficient means of returning capital.
The exemption allows the Filer to extend the offer without first taking up all shares, enabling the determination of the final purchase price after considering all shares tendered during the original and any extension period. This decision is based on the representations made by the Filer, including its compliance with relevant securities legislation and the conditions of the issuer bid.