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Rockwell Diamonds Inc.
Headnote
Application by an issuer for a revocation of a cease trade order issued by the Commission -- cease trade order issued because the issuer failed to file certain continuous disclosure materials required by Ontario securities law -- defaults subsequently remedied by bringing continuous disclosure filings up-to-date -- cease trade order revoked.
Applicable Legislative Provisions
Securities Act, R.S.O. 1990, c. S.5, as am., s. 144.
National Policy 11-207 Failure-to-File Cease Trade Orders and Revocations in Multiple Jurisdictions.
December 23, 2020
ROCKWELL DIAMONDS INC.
REVOCATION ORDER
UNDER THE SECURITIES LEGISLATION OF ONTARIO (the Legislation)
Background
Rockwell Diamonds Inc. (the Issuer or Rockwell) is subject to a failure-to-file cease trade order in Ontario (the FFCTO) issued by the Ontario Securities Commission (the Principal Regulator) on July 5, 2018.
The Issuer has applied to the Principal Regulator under National Policy 11-207 Failure-to-File Cease Trade Orders and Revocations in Multiple Jurisdictions (NP 11-207) for an order revoking the FFCTO.
Interpretation
Terms defined in National Instrument 14-101 Definitions or in NP 11-207 have the same meaning if used in this order, unless otherwise defined.
Representations
This decision is based on the following facts represented by the Issuer:
Rockwell is governed by the Business Corporations Act (British Columbia).
Rockwell's head office is located at C/O Fasken Martineau DuMoulin LLP, Bay Adelaide Centre, Suite 2400, 333 Bay Street, Toronto, Ontario, M5H 2T6.
Rockwell's authorized capital consists of an unlimited number of common shares. As of December 7, 2020, 54,983,244 common shares were issued and outstanding.
Rockwell's common shares are listed for trading on the JSE Limited (JSE) under the symbol "RDI". The common shares remain suspended on the JSE as of the date hereof. Rockwell's common shares were delisted from the NEX on April 1, 2020. The common shares are not listed, quoted or traded on any other exchange, marketplace or other facility for bringing together buyers and sellers in Canada or elsewhere.
Rockwell is a reporting issuer in the provinces of Ontario, Alberta and British Columbia.
The FFCTO was issued due to the failure of the Issuer to file the following, within the required timeframe (collectively, the Required Filings):
(i) audited annual financial statements for the year ended February 28, 2018;
(ii) management's discussion and analysis (MD&A) relating to the audited annual financial statements for the year ended February 28, 2018; and
(iii) certification of the foregoing filings as required by National Instrument 52-109 Certification of Disclosure in Issuers' Annual and Interim Filings (NI 52-109).
Since the issuance of the FFCTO, the Issuer also failed to file the following documents within the required timeframe (collectively, the Additional Required Filings):
(i) interim financial statements for the period ended May 31, 2020;
(ii) management's discussion and analysis for the period ended May 31, 2020;
(iii) annual audited financial statements for the year ended February 29, 2020, together with the auditor's report thereon;
(iv) management's discussion and analysis for the year ended February 29, 2020;
(v) interim financial statements for the period ended November 30, 2019;
(vi) management's discussion and analysis for the period ended November 30, 2019;
(vii) interim financial statements for the period ended August 31, 2019;
(viii) management's discussion and analysis for the period ended August 31, 2019;
(ix) interim financial statements for the period ended May 31, 2019;
(x) management's discussion and analysis for the period ended May 31, 2019;
(xi) annual audited financial statements for the year ended February 28, 2019, together with the auditor's report thereon;
(xii) management's discussion and analysis for the year ended February 28, 2019;
(xiii) annual information form for the year ended February 29, 2020;
(xiv) annual information form for the year ended February 28, 2019; and
(xv) certification of the foregoing filings as required by NI 52-109.
Rockwell has now filed all outstanding continuous disclosure documents with the Principal Regulator, including:
(i) interim financial statements for the period ended August 31, 2020;
(ii) management's discussion and analysis for the period ended August 31, 2020;
(iii) certification of the foregoing filings as required by NI 52-109; and
(iv) the Required Filings and the Additional Required Filings.
The Issuer is not in default of any of its obligations under the FFCTO, nor any requirements under the Legislation or the rules and regulations made pursuant to the Legislation, except the existence of the FFCTO.
Rockwell has paid all outstanding activity, participation and late filing fees that are required to be paid and has filed all forms associated with these payments.
Rockwell's profiles on the System for Electronic Document Analysis and Retrieval (SEDAR) and System for Electronic Disclosure by Insiders (SEDI) are up-to-date.
Other than a possible going private transaction with Mark Bristow, a director and the Chairman of the Issuer, or a related party thereof, the Issuer is not considering, nor is it involved in any discussions relating to a reverse take-over, merger, amalgamation or other form of combination or transaction similar to any of the foregoing.
The Issuer has given the Principal Regulator a written undertaking that, other than a possible going private transaction with Mark Bristow or a related party thereof, the Issuer will not complete:
(i) a restructuring transaction involving, directly or indirectly, an existing or proposed, material underlying business which is not located in Canada,
(ii) a reverse takeover with a reverse takeover acquirer that has a direct or indirect, existing or proposed, material underlying business which is not located in Canada, or
(iii) a significant acquisition involving, directly or indirectly, an existing or proposed, material underlying business which is not located in Canada.
unless
(A) the Issuer files a preliminary prospectus and a final prospectus with the Principal Regulator and obtains receipts for the preliminary and final prospectus from the Director under the Securities Act (Ontario),
(B) the Issuer files or delivers with the preliminary prospectus and the final prospectus the documents required by Part 9 of National Instrument 41-101 General Prospectus Requirements (NI 41-101) including a completed personal information form and authorization in the form set out in Appendix A of NI 41-101 for each current and incoming director, executive officer and promoter of the Issuer, and
(C) the preliminary prospectus and final prospectus contain the information required by applicable securities legislation, including the information required for a probable restructuring transaction, reverse takeover or significant acquisition (as applicable).
Rockwell has provided a written undertaking to hold an annual meeting within three months after the date on which the FFCTO is revoked.
Since the issuance of the FFCTO, there have been no material changes in the business, operations or affairs of the Issuer that have not been disclosed by news release and/or material change report filed on SEDAR.
Upon the revocation of the FFCTO, the Issuer will issue a news release announcing the revocation of the FFCTO and concurrently file the news release and a material change report.
Order:
The Principal Regulator is satisfied that the order to revoke the FFCTO meets the test set out in the Legislation for the Principal Regulator to make the decision.
The decision of the Principal Regulator under the Legislation is that the FFCTO is revoked.
"Lina Creta"
Manager, Corporate Finance
Ontario Securities Commission