SECURE Waste Infrastructure Corp.

Decision

Headnote

Multilateral Instrument 11-102 Passport System and National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- Issuer bid -- Modified Dutch auction -- Application for relief from the requirement to take up and pay for shares on a pro rata basis and the related disclosure requirements for the issuer bid circular (section 2.26 of National Instrument 62-104 Take-Over Bids and Issuer Bids and item 8 of Form 62-104F2) -- Application for relief from the requirement to take up all securities deposited under the issuer bid and not withdrawn if all the terms and conditions of the Offer have been complied with or waived and the Offer is under subscribed (subsection 2.32(4) of National Instrument 62-104 Take-Over Bids and Issuer Bids) -- requested relief granted, subject to conditions.

Applicable Legislative Provisions

National Instrument 62-104 Take-Over Bids and Issuer Bids, ss. 2.26, 2.32(4) and 6.1 and item 8 of Form 62 104F2.

Citation: Re SECURE Waste Infrastructure Corp., 2025 ABASC 40

April 22, 2025

IN THE MATTER OF
THE SECURITIES LEGISLATION OF
ALBERTA AND ONTARIO
(the Jurisdictions)

AND

IN THE MATTER OF
THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS
IN MULTIPLE JURISDICTIONS

AND

IN THE MATTER OF
SECURE WASTE INFRASTRUCTURE CORP.
(the Filer)

DECISION

Background

The securities regulatory authority or regulator in each of the Jurisdictions (each, a Decision Maker) has received an application from the Filer for a decision under the securities legislation of the Jurisdictions (the Legislation) that, in connection with the proposed purchase by the Filer of a portion of its issued and outstanding common shares (the Shares) pursuant to an issuer bid commenced on April 9, 2025 (the Offer), an exemption from the following requirements be granted (the Exemption Sought):

(a) the requirement in Section 2.26 of National Instrument 62-104 Take-Over Bids and Issuer Bids (NI 62-104) to take up and pay for Shares deposited pursuant to the Offer proportionately according to the number of Shares deposited by each holder (a Shareholder) of Shares (the Proportionate Take-Up Requirement);

(b) the requirement in Item 8 of Form 62-104F2 Issuer Bid Circular (Form 62-104F2) to provide disclosure of the proportionate take up and payment of Shares under the Offer in the Filer's issuer bid circular (the Circular) (the Proportionate Take Up Disclosure Requirement); and

(c) the requirement in Section 2.32(4) of NI 62-104 that the Offer not be extended if all the terms and conditions of the Offer have been complied with or waived unless the Filer first takes up all Shares deposited under the Offer and not withdrawn (the Extension Take Up Requirement).

Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a dual application):

(a) the Alberta Securities Commission is the principal regulator for this application;

(b) the Filer has provided notice that subsection 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in British Columbia, Saskatchewan, Manitoba, Québec, Nova Scotia, New Brunswick, Newfoundland and Labrador and Prince Edward Island; and

(c) the decision is the decision of the principal regulator and evidences the decision of the securities regulatory authority or regulator in Ontario.

Interpretation

Terms defined in National Instrument 14-101Definitions and NI 62-104 have the same meaning if used in this decision, unless otherwise defined.

Representations

This decision is based on the following facts represented by the Filer:

1. The Filer is a corporation governed by the Business Corporations Act (Alberta) and is in good standing.

2. The registered office of the Filer is located in Calgary, Alberta.

3. The Filer is a reporting issuer in each of the provinces of Canada and the Shares are listed for trading on the Toronto Stock Exchange (the TSX). The Filer is not in default of any requirement of the securities legislation in any of the jurisdictions in which it is a reporting issuer.

4. The authorized share capital of the Filer consists of (a) an unlimited number of Shares and (b) an unlimited number of preferred shares (the Preferred Shares), issuable in series. As at April 7, 2025, there were 230,865,489 Shares issued and outstanding and no Preferred Shares issued and outstanding.

5. On April 7, 2025, the closing price of the Shares on the TSX was $12.63 per Share. Based on such closing price, the Shares had an aggregate market value of approximately $2,915,831,126.07 on such date.

6. The Offer represents the offer of the Filer to purchase that number of Shares having an aggregate maximum purchase price of up to $200,000,000 (the Specified Maximum Dollar Amount).

7. The purchase price payable per Share (the Purchase Price) will be determined by the Filer through a modified "Dutch auction" procedure in the manner described below, but will be not less than $12.00 per Share (the Minimum Purchase Price) and not more than $14.50 per Share (the Maximum Purchase Price).

8. The Offer commenced on April 9, 2025 and will expire at 5:00 p.m. (Eastern Time) on May 14, 2025 unless withdrawn, extended or varied by the Filer (the Expiration Date).

9. A Shareholder wishing to tender to the Offer will be able to do so in the following ways:

(a) by making an auction tender (Auction Tender), in which the tendering Shareholder specifies both the number of Shares tendered and a specified price per Share (the Auction Price), provided that the Auction Price so specified is not less than the Minimum Purchase Price and not more than the Maximum Purchase Price;

(b) by making a purchase price tender (Purchase Price Tender) in which the tendering Shareholder specifies only the number of Shares tendered, at the Purchase Price to be determined pursuant to the Offer;

(c) by making a proportionate tender (Proportionate Tender) in which the tendering Shareholder agrees to sell to the Filer, at the Purchase Price to be determined pursuant to the Offer, a number of Shares that will result in such Shareholder maintaining its proportionate equity ownership in the Filer following completion of the Offer.

10. A Shareholder may make both an Auction Tender and a Purchase Price Tender, but not in respect of the same Shares. A Shareholder who tenders Shares in an Auction Tender and/or a Purchase Price Tender cannot tender Shares in a Proportionate Tender. Shareholders may also make multiple Auction Tenders at different Auction Prices, but not in respect of the same Shares (i.e., Shareholders may tender different Shares at different prices, but cannot tender the same Shares at different prices). Shareholders making Auction Tenders or Purchase Price Tenders may tender less than all of their Shares to the Offer. Shareholders who tender Shares in a Proportionate Tender may not tender Shares in an Auction Tender or a Purchase Price Tender.

11. A registered Shareholder who makes a Proportionate Tender must deposit all of its Shares. A non-registered Shareholder who wishes its nominee to make a Proportionate Tender must deposit all of its Shares.

12. A Shareholder who properly tenders Shares without specifying the method in which it is tendering its Shares, or who makes an invalid Proportionate Tender, will be deemed to have made a Purchase Price Tender.

13. Any Shareholder who owns fewer than 100 Shares (Odd-Lot Holder) and tenders Shares pursuant to an Auction Tender at or below the Purchase Price or pursuant to a Purchase Price Tender will be considered to have made an "Odd-Lot Tender".

14. Promptly after the expiry of the Offer, the Filer will determine the Purchase Price based on the Auction Prices and the number of Shares deposited pursuant to valid Auction Tenders and Purchase Price Tenders (considered for purposes of determining the Purchase Price to have been tendered at the Minimum Purchase Price). The Purchase Price will be the highest price per Share at which the Filer would be able to purchase all of the Shares collectively tendered pursuant to Auction Tenders at Auction Prices less than or equal to that price and Purchase Price Tenders, having an aggregate Purchase Price that does not exceed the Auction Tender Limit Amount (as defined below); provided that if the aggregate purchase price for Shares collectively tendered pursuant to Auction Tenders at Auction Prices equal to the Minimum Purchase Price and Purchase Price Tenders exceeds the Auction Tender Limit Amount, the Purchase Price will be the Minimum Purchase Price. The term "Auction Tender Limit Amount" means the amount equal to:

(a) the Specified Maximum Dollar Amount, less

(b) the product of:

(i) the Specified Maximum Dollar Amount; and

(ii) a fraction, the numerator of which is the aggregate number of Shares owned by Shareholders making valid Proportionate Tenders, and the denominator of which is the aggregate number of Shares outstanding at the time of expiry of the Offer.

15. Until expiry of the Offer, all information about the number of Shares tendered and the prices at which such Shares are tendered will be required to be kept confidential by the depositary and the Filer until the Purchase Price has been determined.

16. If the aggregate purchase price (the Auction Tender Purchase Amount) for Shares validly tendered and not withdrawn pursuant to, collectively, Auction Tenders at Auction Prices at or below the Purchase Price and Purchase Price Tenders is less than or equal to the Auction Tender Limit Amount, the Filer will purchase, at the Purchase Price, all Shares so tendered pursuant to Purchase Price Tenders and Auction Tenders at or below the Purchase Price.

17. If the Auction Tender Purchase Amount is greater than the Auction Tender Limit Amount, the Filer will purchase a portion of the Shares so tendered pursuant to Purchase Price Tenders and Auction Tenders at or below the Purchase Price, as follows:

(a) first, the Filer will purchase all Shares tendered at or below the Purchase Price pursuant to Odd-Lot Tenders, at the Purchase Price; and

(b) second, the Filer will purchase at the Purchase Price, on a pro rata basis, that portion of the Shares tendered pursuant to Purchase Price Tenders and Auction Tenders at or below the Purchase Price having an aggregate purchase price, based on the Purchase Price, equal to:

(i) the Auction Tender Limit Amount, less

(ii) the aggregate amount paid by the Filer for Shares tendered pursuant to Odd- Lot Tenders, in each case as set forth in clauses (a) and (b) above.

18. The Filer will purchase at the Purchase Price that portion of the Shares deposited by Shareholders making valid Proportionate Tenders that results in each tendering Shareholder maintaining their proportionate Share ownership following completion of the Offer.

19. The number of Shares that the Filer will purchase pursuant to the Offer and the aggregate Purchase Price will vary depending on whether the Auction Tender Purchase Amount is equal to or less than the Auction Tender Limit Amount. If the Auction Tender Purchase Amount is less than the Auction Tender Limit Amount, the Filer will purchase proportionately fewer Shares in the aggregate and, accordingly, having a proportionately lower aggregate Purchase Price.

20. All Shares purchased by the Filer pursuant to the Offer (including Shares tendered at Auction Prices at or below the Purchase Price) will be purchased at the Purchase Price. Shareholders will receive the Purchase Price in cash. All Auction Tenders, Purchase Price Tenders and Proportionate Tenders will be subject to adjustment to avoid the purchase of fractional Shares (rounding down to the nearest whole number of Shares). All payments to Shareholders will be subject to deduction of applicable withholding taxes, if any.

21. The Purchase Price will be denominated in Canadian dollars and the payment of amounts owing to Shareholders whose Shares are taken up under the Offer will be made in Canadian dollars. However, Shareholders may elect to receive the Purchase Price in United States dollars by indicating that in the letter of transmittal for the Offer. The exchange rate that will be used to convert payments from Canadian dollars into U.S. dollars will be the rate available from the depositary and foreign exchange service provider under the Offer, on the date on which the funds are converted, which rate will be based on the prevailing market rate on such date.

22. The Filer will return all Shares not purchased under the Offer (including Shares deposited pursuant to an Auction Tender at Auction Prices greater than the Purchase Price, Shares not purchased because of proration, improper tenders or Shares not taken up due to the termination of the Offer) or that have been properly withdrawn before the Expiration Date.

23. Shareholders who do not accept the Offer will continue to hold the number of Shares held before the Offer and their proportionate Share ownership will increase following completion of the Offer, subject to the number of Shares purchased under the Offer.

24. The Filer will fund the purchase of Shares pursuant to the Offer, together with fees and expenses of the Offer, using cash available to be drawn on the Filer's existing revolving credit facility. The Offer is not conditional upon the receipt of any financing.

25. The board of directors of the Filer (the Board) has determined that the Offer is in the best interests of the Filer. The Board believes that the Offer is a prudent use of the Filer's financial resources given the Filer's business profile and assets, the current market price of the Shares and the Filer's ongoing cash requirements.

26. The Filer may wish to extend the Offer without first taking up all the Shares deposited and not withdrawn under the Offer if, immediately prior to the Expiration Date, the Auction Tender Purchase Amount is less than the Auction Tender Limit Amount (which amount shall never exceed the Specified Maximum Dollar Amount for Shares validly tendered pursuant to any method under the Offer).

27. Under the Extension Take-Up Requirement contained in section 2.32(4) of NI 62-104, an offeror may not extend an issuer bid if all the terms and conditions of the issuer bid have been complied with or waived unless the offeror first takes up all the securities deposited and not withdrawn under the issuer bid.

28. In the event the Offer is extended, the Filer would be unable to take up Shares following the Expiration Date since the Purchase Price depends on all Auction Prices. Not all Auction Prices will be known at the time of the Expiration Date since there may be additional Auction Tenders during the extension period. As such, relief from the Extension Take-Up Requirement is required. Providing relief from the Extension Take-Up Requirement will enable the Filer to make a final determination regarding the Purchase Price, taking into account all Shares tendered during the period prior to the Expiration Date, as well as any subsequent extension period.

29. The Filer will not extend the Offer if all the terms and conditions of the Offer have been complied with or waived by the Filer by the Expiration Date, and the aggregate Purchase Price for Shares validly tendered pursuant to any method under the Offer is greater than or equal to the Specified Maximum Dollar Amount.

30. The Filer is relying on the exemption from the formal valuation requirements applicable to issuer bids under Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions (MI 61-101) set out in paragraph 3.4(b) of MI 61-101 (the Liquid Market Exemption).

31. There was a "liquid market" for the Shares, as such term is defined in MI 61-101, as of the date of making the Offer because the test in paragraph 1.2(1)(a) of MI 61-101 was satisfied based on:

(a) the Shares having been traded on the TSX for the twelve month period prior to the date the Offer is publicly announced; and

(b) the trading of the Shares on the TSX during the twelve month period prior to the announcement of the Offer exceeding the minimum outstanding common share and common share trading volume and market volume requirements set forth in paragraph 1.2(1)(a) of MI 61-101.

32. In addition, the Board has voluntarily obtained a liquidity opinion (the Liquidity Opinion) in accordance with Section 1.2 of MI 61-101 from Scotia Capital Inc. confirming that, as of the date the Offer is publicly announced, based on and subject to customary qualifications, assumptions and restrictions set out therein, (i) a liquid market for the Shares exists and (ii) it is reasonable to conclude that, upon completion of the Offer in accordance with its terms, there will be a market for holders of Shares who do not tender their Shares to the Offer that is not materially less liquid than the market that existed at the time of the making of the Offer. A copy of the Liquidity Opinion is attached to the Circular.

33. Based on the maximum number of Shares that may be purchased under the Offer, as at the date of the Offer, it is reasonable to conclude (and the Liquidity Opinion provides that it will be reasonable to conclude) that, following the completion of the Offer in accordance with its terms, there will be a market for Shareholders who do not tender to the Offer that is not materially less liquid than the market that existed at the time of the making of the Offer.

34. The Circular:

(a) discloses the mechanics for the take-up of and payment for Shares as described herein;

(b) discloses that, by tendering Shares at the Minimum Purchase Price under an Auction Tender or by tendering Shares under a Purchase Price Tender or a Proportionate Tender, a Shareholder can reasonably expect that the Shares so tendered will be purchased at the Purchase Price, subject to proration and other terms of the Offer as specified therein;

(c) explains the manner in which the Purchase Price will be determined pursuant to the Offer and the process for which Shares will either be taken up or returned to Shareholders in accordance with the terms of the Offer;

(d) discloses that the Filer has applied for the Exemption Sought;

(e) discloses the manner in which an extension of the Offer will be communicated to Shareholders and the public;

(f) discloses that Shares deposited pursuant to the Offer may be withdrawn at any time prior to the expiration of any extension period in respect of the Offer;

(g) as applicable, discloses the name of each Shareholder that has advised the Filer that it intends to make a Proportionate Tender;

(h) discloses the facts supporting the Filer's reliance on the Liquid Market Exemption, including the Liquidity Opinion; and

(i) except to the extent exemptive relief is granted further to the Exemption Sought, contains the disclosure prescribed by applicable securities laws for issuer bids.

Decision

Each of the Decision Makers is satisfied that the decision meets the test set out in the Legislation for the Decision Maker to make the decision.

The decision of the Decision Makers under the Legislation is that the Exemption Sought is granted provided that:

(a) Shares validly deposited pursuant to the Offer and not withdrawn are taken up and paid for, or dealt with in the manner set out in the Circular and described herein,

(b) the Filer is eligible to rely on the Liquid Market Exemption, and

(c) the Filer issues and files a press release announcing receipt of the Exemption Sought promptly, and in any case, no later than one (1) business day following receipt of the Exemption Sought.

"Timothy Robson"
Manager, Legal
Corporate Finance
Alberta Securities Commission