Thompson Committee reports : Prospectors could sell their shares

Under a proposal of the 10-month-old Thompson Committee on junior min e financing, prospectors would be able to sell their shares in companies more speedily than under current regulations.

The proposal calls for 25% of property vendors’ shares to be released for sale immediately after filing of the prospectus; 25% after six months; 25% after 12 months; and the balance after 18 months.

Not only would prospectors again be able to get some free shares for their properties; they would be able to sell them sooner.

If implemented by the Ontario Securities Commission, the proposal would be good news for prospectors, says Israel Lyon, a senior policy advisor for the Ontario Ministry of Northern Affairs and Mines.

The proposal has been very favorably received by members of the mining community as well as the OSC, Mr Schiralli said.

Another involves the founders’ share position. It would again be a minimum of 750,000 shares and additional shares could be obtained, but with tougher conditions upon release from escrow.

Members of the committee, including Mr Schiralli and Chairman Edward Thompson, a former president of the Prospectors and Developers Association, took to the road last week for public hearings in Sudbury. The recommendations are designed to encourage more Toronto Stock Exchange-member firms to become involved in junior mining financings and thereby lower the current mark-up being charged by securities dealers.

While many topics were discussed at the hearings in Sudbury and Timmins, the committee reports there is a consensus on the following points:

* Ontario needs a risk-capital market and the proposed policy should be fine-tuned and implemented immediatley.

* A separate market for junior issues is needed and COATS should be upgraded to provide that market.

* The mining industry needs TSE member firms to become more involved in junior financings and special incentives should be considered to get the ball rolling.

* Many northerners are discouraged and angry over past OSC policies and treatment by OSC staff.

The next public hearing will be in Toronto, Oct. 21. The OSC has announced that it will decide, by year-end, which of the committee’s proposals it will adopt. But an additional three to four months will needed.