On June 21, 2012, the Ontario Securities Commission ("OSC") issued a notice to provide guidance to issuers, underwriters and their advisors in filing reports of exempt distribution in Ontario under National Instrument 45-106 Prospectus and Registration Exemptions ("NI 45-106"). Recommendations include, among others: (1) filing the report in the correct form (distributions in British Columbia must be reported to the British Columbia Securities Commission in Form 45-106F6), (2) properly identifying the correct prospectus exemption (noting that the exemptions provided by Sections 2.5 (Family, friends and business associates), 2.9 (Offering memorandum) and 5.2 (TSX Venture Exchange offering) of NI 45-106 are not available in Ontario), (3) complete disclosure of all commissions and finders' fees ("Compensation" includes commissions, discounts or other fees or payments of a similar nature, but does not include payments for services incidental to the distribution (such as clerical, printing, legal or accounting services)), (4) ensuring consistency between the information required to be reported in item 7 of Form 45-106F1 (number of purchasers, jurisdiction of residence, price per security and total dollar value raised from purchasers in each jurisdiction) and the information required to be reported on Schedule 1 to Form 45-106F1 (name of the purchaser, number and type of securities, total purchase price, prospectus exemption relied on and the date of the distribution), and (5) ensuring that total number of purchasers in each jurisdiction (that is, the number of investors) and not to the number of securities each purchaser purchased is set out in Form 45-106F1.
An electronic version of Form 45-106F1 is available on the OSC's website in addition to the paper form.
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