Proposed Amendments to National Instrument 45-106 Prospectus Exemptions to introduce the Listed Issuer Financing Exemption (October 26, 2021)
On July 28, 2021, The Canadian Securities Administrators (CSA) published notice and request for comments on CSA’s proposed amendments to NI 45-106 and related instruments to introduce a new prospectus exemption available to reporting issuers that are listed on a Canadian stock exchange.
The proposed exemption relies on the issuer's continuous disclosure record, as supplemented with a short offering document, and would allow these issuers to distribute freely tradeable listed equity securities to the public.
Issuers would generally be limited to raising the greater of $5,000,000 or 10% of the issuer's market capitalization to a maximum total dollar amount of $10,000,000. In order to use the exemption, the issuer must have been a reporting issuer for at least 12 months.
The offering document would be a "core document" under Canadian securities legislation, forming part of the issuer's continuous disclosure record for purposes of secondary market civil liability.