Canada: Toronto Stock Exchange Announces Amendments To The Company Manual

The Toronto Stock Exchange (TSX) recently announced the approval of certain amendments (the Amendments) to the TSX Company Manual (the Company Manual) pertaining to Non-Corporate Issuers (including ETPs, Closed-end Funds and Structured Products, each as defined below). The Amendments, which became effective on September 17, 2015, include the addition to the Company Manual of "Part XI – Requirements Applicable to Non-Corporate Issuers" and certain ancillary amendments to Parts I and VII of the Company Manual. The following changes to the Company Manual will be of particular interest to participants in the investment funds and asset management industries:

(a) New definitions describing the new listing categories

"Closed-end Fund" has the same meaning as "non-redeemable investment fund" as found in the Securities Act (Ontario).

"ETP" (Exchange-Traded Products) means redeemable equity securities (an Exchange-Traded Fund or ETF) or debt securities (an Exchange-Traded Note or ETN) offered on a continuous basis under a prospectus which gives an investor exposure to the performance of specific indices, sectors, managed portfolios or commodities through a single security.

"Structured Products" means securities generally issued by a Financial Institution (or similar entity) under a base shelf prospectus and pricing supplement where an investor's return is contingent on, or highly sensitive to, changes in the value of underlying assets, indices, interest rates or cash flows. Structured Products include securities such as non-convertible notes, principal or capital protected notes, index or equity linked notes, tracker certificates and barrier certificates.

The TSX has also reserved the discretion to determine if an issuer or securities of an issuer, as applicable, will be considered an ETP, Closed-End Fund or Structured Product.

(b) New listing category for "Non-Corporate Issuers"

This new category includes ETPs, Closed-end Funds and Structured Products. The Amendments do not have retroactive effect, as such a Non-Corporate Issuer listed before September 17, 2015 will continue to be listed in the category under which such issuer was originally listed.

(c) Minimum original offering size (market capitalization) and minimum distribution requirements

ETPs Closed-end Funds Structured Products
Minimum Offering Size Minimum Distribution Minimum Offering Size Minimum Distribution Minimum Offering Size Minimum Distribution
$1 million - $10 million 1 million freely tradable securities (at least 300 public board lot holders) $1 million -

(d) Management requirements in respect of ETPs, Closed-end Funds and Structured Products or their managers

ETPs(1),(2) Closed-end Funds(2) Structured Products(1),(2)
Chief Executive Officer
Chief Financial Officer
Secretary
Independent Review Committee
Chief Executive Officer
Chief Financial Officer
Secretary
Independent Review Committee
Chief Executive Officer
Chief Financial Officer
Secretary
Two independent directors

(e) NAV calculation requirements

ETPs Closed-end Funds Structured Products
Calculated Reported Calculated Reported Calculated Reported
Each trading day Each trading day, on publicly accessible website No less frequently than required by securities law Each day on which NAV is calculated, on publicly accessible website No less frequently than weekly Each day on which NAV is calculated, on publicly accessible website

(f) Ongoing listing requirements

Securities of Closed-end Funds may be suspended or delisted if: (i) the market value of the fund's securities listed on the TSX is less than $3 million over any period of 30 consecutive trading days, (ii) the number of freely-tradable, publicly held securities is less than 500,000 or (iii) the number of public security holders, each holding one board lot or more, is less than 150.

Securities of an ETP or Structured Product may be suspended or delisted if, in the opinion of the TSX, the continued listing of such securities would not be consistent with preserving the overall quality of the market. See the full text of the Amendments for a list of factors that the TSX will consider in making this determination.

(g) Issuance of securities

ETPs must notify the TSX immediately of the issuance or potential issuance of any new class of securities which are convertible into a listed class of securities of the fund.

Closed-end Funds and Structured Products must notify the TSX immediately, and obtain pre-approval from the TSX in connection with any issuance or potential issuance of securities (other than securities which are unlisted, non-voting and non-participating).

(h) Additional listing requirements for new securities

ETPs Closed-end Funds Structured Products
TSX approval required? TSX approval required? TSX approval required?
No, but creation and issuance must comply with the provisions of National Instrument 81-102 – Investment Funds and the fund must provide, (i) on a monthly basis, a Form 1 – Change in Outstanding and Reserved Securities and (ii) on a quarterly basis, either (A) an opinion of counsel that all securities issued during the previous quarter have been validly issued as fully-paid and non-assessable or (B) a certificate of a senior officer confirming the number of securities of the fund created and reported to the TSX in the previous quarter and that full consideration for such securities was received prior to or concurrently with the issuance of such securities. Yes. Any public disclosure regarding the additional listing of securities of a fund must disclose that such transaction is subject to approval/acceptance by the TSX.

Yes. Any public disclosure regarding the additional listing of securities of a fund must disclose that such transaction is subject to approval/acceptance by the TSX.

(i) Supplemental listings

The Amendments introduced the following minimum distribution and market value thresholds in connection with supplemental listings where the securities to be issued are convertible into a currently listed class of the fund.

ETPs Closed-end Funds Structured Products
Minimum Distribution Minimum Market Value Minimum Distribution Minimum Market Value Minimum Distribution Minimum Market Value
Not less than the minimum prescribed number of securities determined by the manager of the fund - 100,000 publicly held securities (at least 100 public board lot holders)

$2 million

100,000 publicly held securities (at least 100 public board lot holders) $2 million

If the securities are not convertible into a currently listed class the original listing requirements will apply.

(j) Notice of termination

An ETP, Closed-end Fund or Structured Product must provide security holders with at least 30 days' notice prior to the fund's termination.

(k) Security holder approval

The TSX may require security holder approval in connection with any amendments to the constating documents of the fund that are not covered by the amendment provisions set forth in such constating documents and which may materially affect the rights of a security holder of the fund as well as in connection with the extension of an ETP or Closed-end Fund beyond the originally contemplated termination date.

(l) Preclearance of materials

ETPs, Closed-end Funds and Structured Products must pre-clear any information circulars and other materials relating to corporate actions, which are to be sent to security holders of the fund, at least five business days in advance of the finalization of such materials.

Footnotes

(1) Other than those issued by Financial Institutions (as defined in the Company Manual).

(2) Management responsible for day-to-day operations of the fund must meet the requirements of Section 325 of the Company Manual.

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.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Similar Articles
Relevancy Powered by MondaqAI
 
In association with
Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
 
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions