Cease trade and freeze orders issued against Archer Gold Inc.

Decisions and Freeze and cease trade orders Securities

Montréal - On December 20, 2011, the Bureau de décision et de révision(the Bureau) issued cease trade and freeze orders against Archer Gold Inc. With this decision, the Bureau prohibited Helga Leuthe, Guy Bégin, Guy Gravel and Paul Vigneault from carrying on any activities in respect of a transaction in the securities of Archer Gold, including activities as a securities dealer. It also prohibited them from pursuing activities as a securities adviser.

In this matter, the Autorité des marchés financiers (the AMF) alleged that investors acquired securities of Archer Gold although the company did not have a prospectus and despite the fact that the four respondents were not registered as dealers. Archer Gold claimed that it was actually a private issuer within the meaning of Regulation 45-106 and that it therefore could benefit from a prospectus and registration exemption under the regulation.

After a detailed analysis of the matter, the Bureau concluded that Archer Gold was not a private issuer and that the distributions were not made to the categories of persons covered by Regulation 45-106. In addition, the Bureau ruled that Archer Gold failed to prove that the exceptions set out in section 2.4 of the Regulation applied in this matter.

In this context, the Bureau confirmed that making distributions to persons not mentioned in this section caused the company to lose the status of private issuer for the future. The Bureau also confirmed that the issuer has the duty and obligation to ensure that the intended distribution is covered by the applicable exemptions.

The Autorité des marchés financiers (the AMF) is the regulatory and oversight body for Québec's financial industry.

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