The Securities Commission granted exemptive relief to a corporate issuer, Sprott Asset Management LP (the Filer), managing Sprott Physical Uranium Trust (the Trust), from certain provisions of National Instrument 81-102 Investment Funds (NI 81-102) and the Securities Act (Ontario). This decision facilitates the continuation of the Trust, which invests in physical uranium, as a non-redeemable investment fund following a plan of arrangement involving the Filer, the Trust, and Uranium Participation Corporation (UPC).
Key exemptions include:
1. Concentration Relief: Allowing the Trust to hold more than 20% of its net asset value (NAV) in securities of UPC subsidiaries, exceeding the usual concentration restrictions.
2. Control Relief: Permitting the Trust to hold more than 10% of the voting or equity securities of UPC subsidiaries, which would typically be restricted.
3. Illiquid Assets Relief: Enabling the Trust to hold securities of UPC subsidiaries as a significant portion of its NAV, despite these being classified as illiquid assets.
4. Custodian Relief: Authorizing the appointment of multiple specialized custodians for the storage of physical uranium, deviating from standard custodial requirements.
Additionally, the Related Issuer Relief exempts the Filer and the Trust from certain Ontario Securities Act provisions that restrict investments in entities where the fund is a substantial securityholder.
The relief is conditional upon the Trust adhering to its investment objectives and operating within the modified investment restrictions of NI 81-102. The Trust must also provide transparent disclosure regarding its holdings in UPC subsidiaries and the obtained exemptions. The decision ensures that the Trust’s operations and management align with the best interests of its unitholders and comply with the necessary regulatory standards for safe and secure custody of physical uranium.
The decision was made under the authority of the Ontario Securities Commission, with the Principal Regulator concluding that the exemptions meet the legislative requirements and are not contrary to the public interest.