Amendments to NI 45-106 Prospectus Exemptions
Amendments to NI 45-106 Prospectus Exemptions
Amendments to
National Instrument 45-106 Prospectus Exemptions
1. National Instrument 45-106 Prospectus Exemptions is amended by this Instrument.
2. The Instrument is amended by adding the following section:
1.8 Designation of insider -- For the purpose of this Instrument, in Ontario, the following classes of persons are designated as insiders:
(a) a director or an officer of an issuer;
(b) a director or an officer of a person that is an insider or a subsidiary of an issuer;
(c) a person that has
(i) beneficial ownership of, or control or direction over, directly or indirectly, securities of an issuer carrying more than 10% of the voting rights attached to all the issuer's outstanding voting securities, excluding, for the purpose of the calculation of the percentage held, any securities held by the person as underwriter in the course of a distribution, or
(ii) a combination of beneficial ownership of, and control or direction over, directly or indirectly, securities of an issuer carrying more than 10% of the voting rights attached to all the issuer's outstanding voting securities, excluding, for the purpose of the calculation of the percentage held, any securities held by the person as underwriter in the course of a distribution;
(d) an issuer that has purchased, redeemed or otherwise acquired a security of its own issue, for so long as it continues to hold that security.
3. Subsection 6.1(1) is amended by adding "completed" before "report if they make the distribution".
4. Subsection 6.2(2) is amended by replacing "financial year-end of the investment fund" with "end of the calendar year".
5. Section 6.3 is amended by
(a) replacing subsection (1) with the following:
(1) The required form of report under section 6.1 [Report of exempt distribution] is Form 45-106F1., and
(b) deleting "or, in British Columbia, Form 45-106F6" from subsection (2).
6. Section 6.6 is repealed.
7. The Instrument is amended by adding the following section:
8.4.3 Transition -- investment funds -- required form of report -- Despite section 6.3, an investment fund that files a report on or before the date required by subsection 6.2(2) for a distribution that occurred before January 1, 2017 may file a report prepared in accordance with the version of Form 45-106F1 in force on June 29, 2016.
8. Form 45-106F1 is repealed and the following substituted:
[Editor's Note: Form 45-106F1 is reproduced on separately numbered pages.]
Form 45-106F1 Report of Exempt Distribution
A. General Instructions
1. Filing instructions
An issuer or underwriter that is required to file a report of exempt distribution and pay the applicable fee must file the report and pay the fee as follows:
• In British Columbia -- through BCSC eServices at http://www.bcsc.bc.ca.
• In Ontario -- through the online e-form available at http://www.osc.gov.on.ca.
• In all other jurisdictions -- through the System for Electronic Document Analysis and Retrieval (SEDAR) in accordance with National Instrument 13-101 System for Electronic Document Analysis and Retrieval (SEDAR) if required, or otherwise with the securities regulatory authority or regulator, as applicable, in the applicable jurisdictions at the addresses listed at the end of this form.
The issuer or underwriter must file the report in a jurisdiction of Canada if the distribution occurs in the jurisdiction. If a distribution is made in more than one jurisdiction of Canada, the issuer or underwriter may satisfy its obligation to file the report by completing a single report identifying all purchasers, and file the report in each jurisdiction of Canada in which the distribution occurs. Filing fees payable in a particular jurisdiction are not affected by identifying all purchasers in a single report.
In order to determine the applicable fee in a particular jurisdiction of Canada, consult the securities legislation of that jurisdiction.
2. Issuers located outside of Canada
If an issuer located outside of Canada determines that a distribution has taken place in a jurisdiction of Canada, include information about purchasers resident in that jurisdiction only.
3. Multiple distributions
An issuer may use one report for multiple distributions occurring within 10 days of each other, provided the report is filed on or before the 10th day following the first distribution date. However, an investment fund issuer that is relying on the exemptions set out in subsection 6.2(2) of NI 45-106 may file the report annually in accordance with that subsection.
4. References to purchaser
References to a purchaser in this form are to the beneficial owner of the securities.
However, if a trust company, trust corporation, or registered adviser described in paragraph (p) or (q) of the definition of "accredited investor" in section 1.1 of NI 45-106 has purchased the securities on behalf of a fully managed account, provide information about the trust company, trust corporation or registered adviser only; do not include information about the beneficial owner of the fully managed account.
5. References to issuer
References to "issuer" in this form include an investment fund issuer and a non-investment fund issuer, unless otherwise specified.
6. Investment fund issuers
If the issuer is an investment fund, complete Items 1-3, 6-8, 10, 11 and Schedule 1 of this form.
7. Mortgage investment entities
If the issuer is a mortgage investment entity, complete all applicable items of this form other than Item 6.
8. Language
The report must be filed in English or in French. In Québec, the issuer or underwriter must comply with linguistic rights and obligations prescribed by Québec law.
9. Currency
All dollar amounts in the report must be in Canadian dollars. If the distribution was made or any compensation was paid in connection with the distribution in a foreign currency, convert the currency to Canadian dollars using the daily noon exchange rate of the Bank of Canada on the distribution date. If the distribution date occurs on a date when the daily noon exchange rate of the Bank of Canada is not available, convert the currency to Canadian dollars using the most recent closing exchange rate of the Bank of Canada available before the distribution date. For investment funds in continuous distribution, convert the currency to Canadian dollars using the average daily noon exchange rate of the Bank of Canada for the distribution period covered by the report.
If the Bank of Canada no longer publishes a daily noon exchange rate and closing exchange rate, convert foreign currency using the daily single indicative exchange rate of the Bank of Canada in the same manner described in each of the three scenarios above.
If the distribution was not made in Canadian dollars, provide the foreign currency in Item 7(a) of the report.
10. Date of information in report
Unless otherwise indicated in this form, provide the information as of the distribution end date.
11. Date of formation
For the date of formation, provide the date on which the issuer was incorporated, continued or organized (formed). If the issuer resulted from an amalgamation, arrangement, merger or reorganization, provide the date of the most recent amalgamation, arrangement, merger or reorganization.
12. Security codes
Wherever this form requires disclosure of the type of security, use the following security codes:
Security code
Security type
BND
Bonds
CER
Certificates (including pass-through certificates, trust certificates)
CMS
Common shares
CVD
Convertible debentures
CVN
Convertible notes
CVP
Convertible preferred shares
DEB
Debentures
FTS
Flow-through shares
FTU
Flow-through units
LPU
Limited partnership units
NOT
Notes (include all types of notes except convertible notes)
OPT
Options
PRS
Preferred shares
RTS
Rights
UBS
Units of bundled securities (such as a unit consisting of a common share and a warrant)
UNT
Units (exclude units of bundled securities, include trust units and mutual fund units)
WNT
Warrants
OTH
Other securities not included above (if selected, provide details of security type in Item 7d)
B. Terms used in the form
1. For the purposes of this form:
"designated foreign jurisdiction" means Australia, France, Germany, Hong Kong, Italy, Japan, Mexico, the Netherlands, New Zealand, Singapore, South Africa, Spain, Sweden, Switzerland or the United Kingdom of Great Britain and Northern Ireland;
"eligible foreign security" means a security offered primarily in a foreign jurisdiction as part of a distribution of securities in either of the following circumstances:
(a) the security is issued by an issuer
(i) that is incorporated, formed or created under the laws of a foreign jurisdiction,
(ii) that is not a reporting issuer in a jurisdiction of Canada,
(iii) that has its head office outside of Canada, and
(iv) that has a majority of the executive officers and a majority of the directors ordinarily resident outside of Canada;
(b) the security is issued or guaranteed by the government of a foreign jurisdiction;
"foreign public issuer" means an issuer where any of the following apply:
(a) the issuer has a class of securities registered under section 12 of the 1934 Act;
(b) the issuer is required to file reports under section 15(d) of the 1934 Act;
(c) the issuer is required to provide disclosure relating to the issuer and the trading in its securities to the public, to security holders of the issuer or to a regulatory authority and that disclosure is publicly available in a designated foreign jurisdiction;
"legal entity identifier" means a unique identification code assigned to the person
(a) in accordance with the standards set by the Global Legal Entity Identifier System, or
(b) that complies with the standards established by the Legal Entity Identifier Regulatory Oversight Committee for pre-legal entity identifiers;
"permitted client" has the same meaning as in National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations;
"SEDAR profile" means a filer profile required under section 5.1 of National Instrument 13-101 System for Electronic Document Analysis and Retrieval (SEDAR).
2. For the purposes of this form, a person is connected with an issuer or an investment fund manager if either of the following applies:
(a) one of them is controlled by the other;
(b) each of them is controlled by the same person.
Form 45-106F1 Report of Exempt Distribution
IT IS AN OFFENCE TO MAKE A MISREPRESENTATION IN THIS REPORT
SCHEDULE 1 TO FORM 45-106F1 (CONFIDENTIAL PURCHASER INFORMATION)
Schedule 1 must be filed in the format of an Excel spreadsheet in a form acceptable to the securities regulatory authority or regulator.
The information in this schedule will not be placed on the public file of any securities regulatory authority or regulator. However, freedom of information legislation may require the securities regulatory authority or regulator to make this information available if requested.
a) General information (provide only once)
1. Name of issuer
2. Certification date (YYYY-MM-DD)
Provide the following information for each purchaser that participated in the distribution. For each purchaser, create separate entries for each distribution date, security type and exemption relied on for the distribution.
b) Legal name of purchaser
1. Family name
2. First given name
3. Secondary given names
4. Full legal name of non-individual (if applicable)
c) Contact information of purchaser
1. Residential street address
2. Municipality
3. Province/State
4. Postal code/Zip code
5. Country
6. Telephone number
7. Email address (if available)
d) Details of securities purchased
1. Date of distribution (YYYY-MM-DD)
2. Number of securities
3. Security code
4. Amount paid (Canadian $)
e) Details of exemption relied on
1. Rule, section and subsection number
2. If relying on section 2.3 [Accredited investor] of NI 45-106, provide the paragraph number in the definition of "accredited investor" in section 1.1 of NI 45-106 that applies to the purchaser. (select only one)
3. If relying on section 2.5 [Family, friends and business associates] of NI 45-106, provide:
a. the paragraph number in subsection 2.5(1) that applies to the purchaser (select only one); and
b. if relying on paragraphs 2.5(1)(b) to (i), provide:
i. the name of the director, executive officer, control person, or founder of the issuer or affiliate of the issuer claiming a relationship to the purchaser. (Note: if Item 9(a) has been completed, the name of the director, executive officer or control person must be consistent with the name provided in Item 9 and Schedule 2.)
ii. the position of the director, executive officer, control person, or founder of the issuer or affiliate of the issuer claiming a relationship to the purchaser.
4. If relying on subsection 2.9(2) or, in Alberta, New Brunswick, Nova Scotia, Ontario, Québec, or Saskatchewan, subsection 2.9(2.1) [Offering memorandum] of NI 45-106 and the purchaser is an eligible investor, provide the paragraph number in the definition of "eligible investor" in section 1.1 of NI 45-106 that applies to the purchaser. (select only one)
f) Other information
1. Is the purchaser a registrant? (Y/N)
2. Is the purchaser an insider of the issuer? (Y/N) (not applicable if the issuer is an investment fund)
3. Full legal name of person compensated for distribution to purchaser. If the person compensated is a registered firm, provide the firm NRD number only. (Note: the name must be consistent with name of the person compensated as provided in Item 8.)
INSTRUCTIONS FOR SCHEDULE 1
Any securities issued as payment for commissions or finder's fees must be disclosed in Item 8 of the report, not in Schedule 1.
Details of exemption relied on -- When identifying the exemption the issuer relied on for the distribution to each purchaser, refer to the rule, statute or instrument in which the exemption is provided and identify the specific section and, if applicable, subsection or paragraph. For example, if the issuer is relying on an exemption in a National Instrument, refer to the number of the National Instrument, and the subsection or paragraph number of the specific provision. If the issuer is relying on an exemption in a local blanket order, refer to the blanket order by number.
For exemptions that require the purchaser to meet certain characteristics, such as the exemption in section 2.3 [Accredited investor], section 2.5 [Family, friends and business associates] or subsection 2.9(2) or, in Alberta, New Brunswick, Nova Scotia, Ontario, Québec, or Saskatchewan, subsection 2.9(2.1) [Offering memorandum] of NI 45-106, provide the specific paragraph in the definition of those terms that applies to each purchaser.
Reports filed under paragraph 6.1(1)(j) [TSX Venture Exchange offering] of NI 45-106 -- For reports filed under paragraph 6.1(1)(j) [TSX Venture Exchange offering] of NI 45-106, Schedule 1 needs to list the total number of purchasers by jurisdiction only, and is not required to include the name, residential address, telephone number or email address of the purchasers.
SCHEDULE 2 TO FORM 45-106F1 (CONFIDENTIAL DIRECTOR, EXECUTIVE OFFICER, PROMOTER AND CONTROL PERSON INFORMATION)
Schedule 2 must be filed in the format of an Excel spreadsheet in a form acceptable to the securities regulatory authority or regulator.
Complete the following only if Item 9(a) is required to be completed. This schedule also requires information to be provided about control persons of the issuer at the time of the distribution.
The information in this schedule will not be placed on the public file of any securities regulatory authority or regulator. However, freedom of information legislation may require the securities regulatory authority or regulator to make this information available if requested.
a) General information (provide only once)
1. Name of issuer
2. Certification date (YYYY-MM-DD)
b) Business contact information of Chief Executive Officer (if not provided in Item 10 or 11 of report)
1. Email address
2. Telephone number
c) Residential address of directors, executive officers, promoters and control persons of the issuer
Provide the following information for each individual who is a director, executive officer, promoter or control person of the issuer at the time of the distribution. If the promoter or control person is not an individual, provide the following information for each director and executive officer of the promoter and control person. (Note: names of directors, executive officers and promoters must be consistent with the information in Item 9 of the report, if required to be provided.)
1. Family name
2. First given name
3. Secondary given names
4. Residential street address
5. Municipality
6. Province/State
7. Postal code/Zip code
8. Country
9. Indicate whether the individual is a control person, or a director and/or executive officer of a control person (if applicable)
d) Non-individual control persons (if applicable)
If the control person is not an individual, provide the following information. For locations within Canada, state the province or territory, otherwise state the country.
1. Organization or company name
2. Province or country of business location
Questions:
Refer any questions to:
9. Form 45-106F6 is repealed.
10. This Instrument comes into force on June 30, 2016.