As recently announced in a Corporate Finance Bulletin and Notice to
Issuers (the "Bulletin"), the TSX Venture Exchange
("TSX-V") has extended until April 30, 2013 three
temporary measures (the "Relief Measures") designed to
provide relief to issuers from certain pricing requirements
relating to private placement financings. The Relief Measures,
originally implemented in August 2012, are as follows:
1) Allowing a share/unit offering with an offering price below
2) Allowing a debenture offering with a debenture conversion
price below $0.10.
3) Allowing offerings involving a warrant with an exercise price
In order to rely on the Relief Measures, an issuer must
demonstrate that it is subject to immediate or imminent financial
hardship and that it does not have the time or resources to
undertake a share consolidation before closing the financing. In
addition, the principal use of proceeds of the financing must be to
maintain or preserve the existing business of the issuer and none
of the proceeds may be used to compensate or satisfy obligations to
related parties of the issuer.
The Bulletin includes an amendment to the originally-implemented
Relief Measures by introducing the concept of an "Excluded
Amount" with respect to financings with a share/unit offering
price below $0.05 or a debenture conversion price below $0.10. The
amended Relief Measures provide that up to $50,000 of the gross
proceeds raised in a financing in reliance on the Relief Measures
can be used for general working capital purposes and is not subject
to the "Maintain/Preserve Existing Business" and "No
Payments to Related Parties" conditions noted above.
Specifics of the requirements and conditions associated with use
of the Relief Measures are detailed in the Bulletin.
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