NIN 2000/09 - Commission Recognizes the Canadian Venture Exchange Resale Requirements [NIN - Rescinded]
| Published Date: | 2000-02-25 |
|---|---|
| Effective Date: | 2000-02-24 |
As a result of CDNX’s decision to adopt the Resale Matrix, the Commission has, for the interim period, recognized CDNX for the purposes of section 127 of the Securities Rules as an exchange with “recognized resale requirements”. The Resale Matrix is set out in the amendments to CDNX’s Corporate Finance Manual being published by CDNX concurrently with this Notice (and will be available on CDNX’s website at www.cdnx.ca).
Interim Period
CDNX has adopted the Resale Matrix for an interim period only. The hold periods prescribed by the Resale Matrix therefore will apply to seed securities distributed in British Columbia only in so far as the issuer meets the terms of CDNX’s adoption of the Resale Matrix.
CDNX’s Resale Matrix applies to holders in British Columbia of seed securities of an issuer that meet the following conditions:
1. the issuer’s final prospectus for its initial public offering (“IPO”) is receipted on or before June 30, 2000;
2. the issuer’s securities are listed on CDNX on or before September 30, 2000; and
3. if the issuer completed its IPO distribution between November 26, 1999 and February 22, 2000, the issuer confirms to CDNX that it has notified the affected holders of seed securities of the change in the resale requirements and has corrected any disclosure record relating to the applicable resale restrictions by filing a material change report and press release.
Background
At the time of the merger of the VSE and The Alberta Stock Exchange, the exchanges decided that CDNX would not adopt the Resale Matrix as part of its resale requirements in British Columbia. The exchanges did request that the Commission provide transitional relief for IPOs completed on the VSE prior to the merger and the Commission implemented that transitional relief in Part 4 of Blanket Order 51-501 (BC) - Transitional Orders Relating to Former Alberta and Vancouver Stock Exchange Issuers.
Following the merger, CDNX and the Commission received submissions from legal counsel in British Columbia that issuers were unaware that CDNX had not adopted the Resale Matrix. In light of the speed at which the merger was completed, the Commission welcomes CDNX’s decision to adopt the Resale Matrix to allow issuers to complete for an interim period IPOs under the terms that previously applied to IPOs on the VSE.
Applicable Resale Rules After Interim Period
Seed securities distributed in British Columbia are subject to the resale restrictions in sections 140 to 143 of the Securities Rules.
During the interim period, seed securities of an issuer that completes its IPO on CDNX which are subject to either section 140(2)(a), 141(c) or 143(f) of the Securities Rules will have hold periods determined by the Resale Matrix.
After the interim period, seed securities of an issuer that completes its IPO on CDNX which are subject to either section 140(2)(a), 141(c) or 143(f) of the Securities Rules will have an effective 12 month hold starting from the date the issuer becomes a reporting issuer.
Use of Special Warrants by Non-Reporting Issuers
The Executive Director has in the past objected to an IPO prospectus that qualifies securities issued on conversion of previously issued special warrant securities (“converted securities”), in part, due to the availability of the Resale Matrix.
As the CDNX Resale Matrix will be available for an interim period only and as other jurisdictions have not objected to IPO prospectuses that qualify converted securities, the Executive Director will now generally not object to an IPO prospectus that qualifies converted securities provided that the prospectus also qualifies a distribution of securities to the public and contains an underwriter’s certificate.
DATED at Vancouver, British Columbia, on February 24, 2000.
Douglas M. Hyndman
Chair
Ref: BOR#51-501 (BC)
This NIN refers to other documents. These documents can be found at the B.C. Securities Commission public website at www.bcsc.bc.ca in the Policy Documents database