55-506 - Exemption from insider reporting requirements for certain derivative transactions [BCI - Rescinded]
Published Date: | 2004-02-27 |
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Effective Date: | 2004-02-28 |
Rescinded Date: | 2010-04-30 |
February 25, 2004
Douglas M. Hyndman
Chair
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(This part is for administrative purposes only and is not part of the Order)
Authority under which Order is made:
Act and sections: SecuritiesAct, section 91(1)
Other (specify):
BC Instrument 55-506
Exemption from insider reporting requirements for certain derivative transactions
Defined terms
1. In this Instrument:
“compensation arrangement” includes, any plan, contract, authorization or arrangement, whether or not set out in any formal document and whether or not applicable to only one individual, under which cash, securities, options, SARs, phantom stock, warrants, convertible securities, restricted shares or restricted share units, performance units and performance shares, or similar instruments may be received or purchased;
“credit derivative” means a derivative in respect of which the underlying security, interest, benchmark or formula is, or is related to or derived from, in whole or in part, a debt or other financial obligation of a reporting issuer;
“derivative” means an instrument, agreement or security, the market price, value or payment obligations of which is derived from, referenced to or based on an underlying security, interest, benchmark or formula;
“security of a reporting issuer” includes
(a) a put, call, option or other right or obligation to purchase or sell securities of the reporting issuer; and
(b) a related financial instrument;“stock appreciation right” (SAR) means a right, granted by an issuer or any of its subsidiaries as compensation for services rendered or otherwise in connection with holding an office or employment with that issuer or subsidiary, to receive a payment of cash or an issue or transfer of securities based wholly or in part on changes in the trading price of publicly traded securities.
Interpretation
2.Terms defined in the SecuritiesAct, the Securities Rules or National Instrument
14-101 Definitions have the same meaning in this Instrument.
Exemption from insider reporting requirements
3. An insider is not required to report under section 87 of the Act a transaction involving a related financial instrument for:
No securities or derivatives
(a) an agreement or transaction that does not involve, directly or indirectly, an interest in
(ii) a derivative in respect of which the underlying security, interest, benchmark or formula is, or includes as a material component, a security of the reporting issuer;
Compensation arrangements
Unlimited recourse loans
(c) a transfer, pledge or encumbrance of securities by an insider for the purpose of giving collateral for a debt made in good faith so long as there is no limitation on the recourse available against the insider for any amount payable under the debt;
Securities pledged in the ordinary course of business of insider
(d) the receipt by an insider of a transfer, pledge or encumbrance of securities of an issuer if the securities are transferred, pledged or encumbered as collateral for a debt under a written agreement and in the ordinary course of business of the insider;
Credit derivatives
(e) an agreement that is a credit derivative, if the insider is not an individual;
(f) the acquisition or disposition of a security, or an interest in a security, of a mutual fund or a non-redeemable investment fund, provided that securities of the reporting issuer do not form a material component of the mutual fund or non-redeemable investment fund’s market value; or
Indirect acquisition or disposition
(g) the acquisition or disposition of a security, or an interest in a security, of an issuer that holds directly or indirectly securities of the reporting issuer, if:(i) the insider is not a control person of the issuer; and(ii) the insider does not have or share investment control over the securities of the reporting issuer.