On August 17, 2012 the TSX Venture Exchange (TSXV) published a bulletin entitled Private Placements – Temporary Relief from Certain Pricing Requirements (Original Bulletin), which provided, on a temporary basis and subject to compliance with the Original Bulletin, the granting of relief to TSXV issuers from certain existing pricing requirements related to private placement financings. These temporary measures (Relief Measures) were effective as of August 17, 2012 and continued until December 31, 2012 (Original Temporary Relief Period). The TSXV issued the Original Bulletin as a result of the current market environment faced by many of its listed issuers and the effect that this was having on their ability to complete financings and maintain and preserve their existing operations, activities and assets. Readers are directed to our firm bulletin dated September 24, 2012 entitled TSX Venture Exchange - Private Placements - Temporary Relief from Certain Pricing Requirements, which provides a summary of the Original Bulletin. On December 12, 2012, the TSXV issued a bulletin entitled Private Placements - Extension and Modification of Temporary Relief from Certain Pricing Requirements (New Bulletin). The New Bulletin accomplishes two things: firstly, it extends the Original Temporary Relief Period to April 30, 2013, giving TSXV issuers additional time to take advantage of the Relief Measures; and secondly, it introduces the concept of an "Excluded Amount", which enables TSXV issuers relying on the Relief Measures to use up to $50,000 of the gross proceeds raised under a private placement for general working capital purposes (i.e., the "Excluded Amount" will not be subject to the Maintain/Preserve Existing Business or No Payments to Related Parties conditions). Lastly, the requirement to use the proceeds of the private placement immediately or imminently will not apply to the "Excluded Amount" and any proposed payments to related parties must be disclosed in the news release disseminated by the issuer in conjunction with the closing of the private placement.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
