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Q: Do shares held on behalf of a client count towards the early warning limit?

A: Yes, shares held on behalf of a client can count towards the early warning limit. According to National Instrument 62-103, an entity that controls securities on behalf of another entity is required to advise the entity of the number of securities held on its behalf, especially if the securityholding percentage of the entity in a class of voting or equity securities of the reporting issuer equals 10 percent or more (Section 4.3(4)). However, there are exemptions and specific conditions under which securities owned or controlled by an investment fund can be treated separately (Section 5.2).


National Instrument 62-103 The Early Warning System and Related Takeover Bid and Insider Reporting Issues
Part 6 Issuer Actions
Section 6.1

Issuer Actions

(1) An entity is exempt from the early warning requirements and the obligation to report under Part 4 in connection with an increase in the securityholding percentage of the entity in a class of securities of a reporting issuer that arises without any action being taken by the entity and solely from a reduction in outstanding securities that occurs as a result of redemptions, retractions or other repurchases by the reporting issuer, that affect or are offered to all security holders of the relevant class.

(2) An entity is exempt from the early warning requirements and the obligation to report under Part 4 in connection with a decrease in the securityholding percentage of the entity in a class of securities of a reporting issuer that arises without any action being taken by the entity and solely from an increase in outstanding securities that occurs as a result of treasury issuances of securities by the reporting issuer.

(3) An entity may rely upon an exemption provided by this section in connection with a class of securities only until the entity undertakes any transaction that changes the securityholding percentage of the entity in that class of securities.

(4) An entity that undertakes a transaction described in subsection (3) shall comply with the early warning requirements or Part 4 in connection with the class of securities referred to in that subsection in a manner that reflects the changes in the securityholding percentage of the entity in that class of securities since the last news release or report made or filed under the early warning requirements or Part 4.


National Instrument 62-103 The Early Warning System and Related Takeover Bid and Insider Reporting Issues
Part 2 General Reliance and Reporting Provisions
Section 2.1

Reliance on Reported Outstanding Shares

(1) Subject to subsection (2), in determining its securityholding percentage in a class of securities for the purposes of the early warning requirements or Part 4, an entity may rely upon information most recently provided by the issuer of the securities in a material change report or under section 5.4 of National Instrument 51-102 Continuous Disclosure Obligations, whichever contains the most recent relevant information.

(2) Subsection (1) does not apply if the entity has knowledge both

(a) that the information filed is inaccurate or has changed; and

(b) of the correct information.


National Instrument 62-103 The Early Warning System and Related Takeover Bid and Insider Reporting Issues
Part 2 General Reliance and Reporting Provisions
Section 2.3

No Duplication of News Releases or Reports

(1) An entity that is required to issue a news release under both the early warning requirements and the acquisition announcement provisions is exempt from the requirement to issue the news release contained in the provision requiring the later release if

(a) the news release is filed under the provision with the earlier reporting requirement; and

(b) the facts required to be contained in the two news releases are identical.

(2) An entity that is required to file a report under the acquisition announcement provisions and either the early warning requirements or Part 4 is exempt from the requirement to file the report under the provision requiring the later report if

(a) the report is filed under the provision requiring the earlier report; and

(b) the facts required to be contained in the two reports are identical.


National Instrument 62-103 The Early Warning System and Related Takeover Bid and Insider Reporting Issues
Part 4 Alternative Monthly Reporting System
Section 4.1

Exemption from the Early Warning Requirements

The early warning requirements do not apply to an eligible institutional investor for a reporting issuer if the eligible institutional investor

(a) is not disqualified by section 4.2 from filing reports under this Part for the reporting issuer; and

(b) either

(i) intends to file reports under this Part for the reporting issuer, if no reports are yet required to be filed; or

(ii) is not in arrears of filing reports under this Part for the reporting issuer, if a report has been required by this Part to be filed.


National Instrument 62-103 The Early Warning System and Related Takeover Bid and Insider Reporting Issues
Part 9 Insider Reporting Exemption
Section 9.1

Insider Reporting Exemption; Early Warning Decrease Reports

(1) Subject to subsections (3.1) and (4), an eligible institutional investor is exempt from the insider reporting requirement for a reporting issuer if

(a) the eligible institutional investor has filed the report required under the early warning requirements or Part 4 for the reporting issuer in connection with the current securityholding percentage of the eligible institutional investor in the classes of voting and equity securities of the reporting issuer;

(a.1) the report referred to in paragraph (a) discloses, in addition to any other required disclosure,

(i) the eligible institutional investor’s interest in any related financial instrument involving a security of the reporting issuer that is not otherwise reflected in the current securityholding percentage of the eligible institutional investor; and

(ii) the material terms of the related financial instrument;

(b) the eligible institutional investor is not disqualified under section 4.2 from filing reports under Part 4;

(c) the eligible institutional investor does not have knowledge of any material fact or material change with respect to the reporting issuer that has not been generally disclosed;

(d) the eligible institutional investor does not receive in the ordinary course of its business and investment activities knowledge of any material fact or material change with respect to the reporting issuer that has not been generally disclosed;

(e) there are no directors or officers of the reporting issuer who were, or could reasonably be seen to have been, selected, nominated or designated by the eligible institutional investor or any joint actor; and

(f) the eligible institutional investor, either alone or together with any joint actors, does not possess effective control of the reporting issuer.

(2) An eligible institutional investor relying on the exemption in subsection (1) shall maintain records that include the information that, absent this section, would have been required to be included in a report filed under the insider reporting requirement.

(3.1) Despite subsection (1), an eligible institutional investor that is filing reports under the early warning requirements or Part 4 for a reporting issuer may rely upon the exemption contained in subsection (1) only if the eligible institutional investor treats a significant change in a related financial instrument position as a change in a material fact for the purposes of securities legislation pertaining to the early warning requirements or section 4.6 of this Instrument.

(4) Despite subsection (1), an eligible institutional investor that is an insider of a reporting issuer may not rely upon the exemption contained in subsection (1) if

(a) the eligible institutional investor, either alone or with a joint actor or joint actors, purchased in the previous month, directly or indirectly, 50 percent or more of all of the securities of a class that were reported sold on stock exchanges, over-the-counter markets or both in the previous month; or

(b) the eligible institutional investor, either alone or with a joint actor or joint actors, sold in the previous month, directly or indirectly, 50 percent or more of all of the securities of a class that were reported sold on stock exchanges, over-the-counter markets or both in the previous month.

(5) If an eligible institutional investor is exempt under subsection (1) from the insider reporting requirement for a reporting issuer, every director or senior officer of the eligible institutional investor who is an insider of the reporting issuer solely as a result of being director or senior officer of the eligible institutional investor is exempt from the insider reporting requirement for the reporting issuer.


National Instrument 62-103 The Early Warning System and Related Takeover Bid and Insider Reporting Issues
Part 5 Aggregation Relief
Section 5.3

Reporting and Record Keeping

(1) In addition to the requirements of sections 5.1 and 5.2, in order to rely on section 5.1 or 5.2, an eligible institutional investor or an affiliate or associate shall indicate in any document released or filed under the applicable provisions or securities legislation related to the applicable definitions

(a) its reliance on either section 5.1 or 5.2;

(b) the identity of the business units or investment funds for which ownership and control of the securities has been disclosed; and

(c) the fact that securities owned or controlled by other business units or investment funds have not been, or may not have been, disclosed.

(2) An eligible institutional investor or affiliate or associate shall maintain records of the details concerning

(a) business units of the entity that are treated separately, by reason of section 5.1, for the purposes of compliance with the applicable provisions and securities legislation related to the applicable definitions; and

(b) investment funds whose ownership of, or control over, securities are treated separately, by reason of section 5.2, for the purposes of compliance with the applicable provisions and securities legislation related to the applicable definitions.


National Instrument 62-103 The Early Warning System and Related Takeover Bid and Insider Reporting Issues
Part 5 Aggregation Relief
Section 5.4

No Requirement to Satisfy Insider Reporting Requirement

If an eligible institutional investor, or an affiliate or associate of an eligible institutional investor, is relying on this Part so that it is not subject to the insider reporting requirement for a reporting issuer, then every director or senior officer of the eligible institutional investor, or of the affiliate or associate of an eligible institutional investor, who is an insider of the reporting issuer solely as a result of being a director or senior officer of the eligible institutional investor, or the affiliate or associate of an eligible institutional investor, is not subject to the insider reporting requirement for the reporting issuer.


National Instrument 62-103 The Early Warning System and Related Takeover Bid and Insider Reporting Issues
Part 3 Early Warning Requirements
Section 3.2

Filing Relief for Joint Actors

The early warning requirements and the acquisition announcement provisions do not apply to a joint actor of an acquiror in connection with the obligation to make a specific filing of a news release or report if

(a) the acquiror files a news release or report at the time that the joint actor would be required to file; and

(b) the news release or report filed discloses the information concerning the joint actor required by securities legislation.


National Instrument 62-103 The Early Warning System and Related Takeover Bid and Insider Reporting Issues
Part 3 Early Warning Requirements
Section 3.1

Contents of News Releases and Reports

(1) A news release and report required under the early warning requirements shall contain the information required by Form 62-103F1 Required Disclosure under the Early Warning Requirements.

(2) Despite subsection (1), a news release required under the early warning requirements may omit the information otherwise required by Items 2.3, 3.3, 3.5 through 3.8, 4.2, 4.3, 6 and 9, and Item 7 to the extent that the information relates to those sections and items, of Form 62-103F1 Required Disclosure under the Early Warning Requirements, if

(a) the omitted information is included in the corresponding report required by the early warning requirements, and

(b) the news release indicates the name and telephone number of an individual to contact to obtain a copy of the report.

(3) The acquiror shall send a copy of the report referred to in paragraph (2)(a) promptly to any entity requesting it.


National Instrument 62-103 The Early Warning System and Related Takeover Bid and Insider Reporting Issues
Part 4 Alternative Monthly Reporting System
Section 4.4

Restrictions on Acquisitions

An eligible institutional investor that has become disqualified under section 4.2 from filing reports under this Part for a reporting issuer, if the securityholding percentage of the eligible institutional investor in a class of voting or equity securities of the reporting issuer is 10 percent or more, shall not acquire ownership of, or control over, any additional securities of the reporting issuer for the period

(a) starting at the time that the news release referred to in paragraph 4.3(1)(a) is required to be filed; and

(b) ending 10 days after the news release is filed.


National Instrument 62-103 The Early Warning System and Related Takeover Bid and Insider Reporting Issues
Part 4 Alternative Monthly Reporting System
Section 4.3

Reporting and Filing Requirements

(1) If an eligible institutional investor is relying on the exemption in section 4.1 for a reporting issuer and becomes disqualified under section 4.2 from filing, or no longer intends to file, reports under this Part for the reporting issuer, the eligible institutional investor shall

(a) immediately issue and file a news release; and

(b) within two business days after filing the news release, file a report.

(2) The news release and report required by subsection (1) shall contain the information required by Form 62-103F2 Required Disclosure by an Eligible Institutional Investor under Section 4.3.

(3) An eligible institutional investor that is required to file a report under subsection (1) for a reporting issuer is not exempt from the early warning requirements for that reporting issuer as of the date on which the news release required by subsection (1) is required to be filed.

(4) An eligible institutional investor that files reports under this Part for a reporting issuer and that controls securities of the reporting issuer that are owned by another entity shall

(a) on request by the entity, promptly advise the entity of the number of securities held on its behalf; and

(b) if the eligible institutional investor has reason to believe that the securityholding percentage of the entity in a class of voting or equity securities of the reporting issuer equals 10 percent or more, promptly advise the entity of the number of securities held on its behalf.


National Instrument 62-103 The Early Warning System and Related Takeover Bid and Insider Reporting Issues
Part 5 Aggregation Relief
Section 5.2

Securities Held by an Investment Fund

An eligible institutional investor, or an affiliate or associate of an eligible institutional investor, may, for the purposes of the applicable provisions and securities legislation related to the applicable definitions, treat securities owned or controlled by an investment fund over which the eligible institutional investor, affiliate or associate exercises or shares control, or securities into which those securities are convertible, exercisable or exchangeable, separately from other securities owned or controlled by the eligible institutional investor or affiliate or associate if

(a) the investment fund is not a private mutual fund;

(b) a portfolio adviser manages the investment fund on behalf of the eligible institutional investor under a written agreement;

(c) the portfolio adviser has been identified as managing the investment fund in a document provided to an investor;

(d) none of the eligible institutional investor, its affiliates or associates, or a director, officer, partner, employee or agent of the eligible institutional investor or its affiliates or associates, makes, advises on, participates in the formulation of, or exercises influence over, decisions made by the portfolio adviser on the acquisition, disposition, holding or voting of securities, except for the purposes of

(i) preparing research reports,

(ii) monitoring or ensuring compliance with regulatory requirements, or

(iii) setting, monitoring or ensuring compliance with general investment policies, guidelines, objectives or restrictions;

(e) the eligible institutional investor or affiliate or associate has reasonable grounds for believing that the portfolio adviser complies with the applicable provisions and securities legislation related to the applicable definitions in connection with securities owned or controlled by the investment fund;

(f) the portfolio adviser neither controls nor is controlled by the eligible institutional investor or an affiliate or associate of the eligible institutional investor; and

(g) the eligible institutional investor or affiliate or associate complies with section 5.3.


National Instrument 62-103 The Early Warning System and Related Takeover Bid and Insider Reporting Issues
Part 8 Relief For Pledgees
Section 8.1

Relief for Pledgees

(1) For securities that are controlled by a person or company as a pledgee, and any securities into which those securities are convertible, exercisable or exchangeable, in either case that are pledged, mortgaged or otherwise encumbered as collateral for a debt under a written pledge agreement and in the ordinary course of the business of the person or company, the person or company is exempt from the applicable provisions, and those securities are not required to be taken into account for the purposes of securities legislation related to the applicable definitions.

(2) Subsection (1) does not apply at any time that the person or company is legally entitled to dispose of the securities as pledgee for the purpose of applying proceeds of realization in repayment of the secured debt.


National Instrument 62-103 The Early Warning System and Related Takeover Bid and Insider Reporting Issues
Part 8 Relief For Pledgees
Section 8.2

Further Relief for de minimis Pledgees

Despite subsection 8.1(2), for securities that are controlled by a person or company as a pledgee, and any securities into which those securities are convertible, exercisable or exchangeable, in either case that are or were pledged, mortgaged or otherwise encumbered as collateral for a debt, under a written pledge agreement and in the ordinary course of the business of the person or company, the person or company is exempt from the applicable provisions, and those securities are not required to be taken into account for the purposes of securities legislation related to the applicable definitions, even if the person or company is legally entitled to dispose of the securities as pledgee for the purpose of applying proceeds of realization in repayment of the secured debt, if

(a) the principal amount of the debt, together with the principal amount of all other debts of or guaranteed by the same borrower to the person or company, does not exceed $2,000,000; and

(b) the pledged securities, and securities into which the pledged securities are convertible, exercisable or exchangeable, constitute less than 10 percent of a class of voting or equity securities.


National Instrument 62-103 The Early Warning System and Related Takeover Bid and Insider Reporting Issues
Part 8 Relief For Pledgees
Section 8.3

Corresponding Insider Reporting Relief

If a person or company is exempt under section 8.1 or 8.2 from the insider reporting requirement for those securities of a reporting issuer that it controls as pledgee, every director or senior officer of the person or company who is an insider of the reporting issuer solely as a result of being a director or senior officer of the person or company that is an insider of the reporting issuer is exempt from the insider reporting requirement for those securities.


National Instrument 62-103 The Early Warning System and Related Takeover Bid and Insider Reporting Issues
Part 1 Definitions and Interpretation
Section 1.1 Definitions

significant change in a related financial instrument position

significant change in a related financial instrument position” means, in relation to an entity and a related financial instrument that involves, directly or indirectly, a security of a reporting issuer, any change in the entity’s interest in, or rights or obligations associated with, the related financial instrument if the change has a similar economic effect to an increase or decrease in the entity’s securityholding percentage in a class of voting or equity securities of the reporting issuer by 2.5 percent or more;


National Instrument 62-103 The Early Warning System and Related Takeover Bid and Insider Reporting Issues
Part 4 Alternative Monthly Reporting System
Section 4.8

Exemptions

The requirement to file a report under this Part does not apply to a joint actor with an eligible institutional investor in connection with a specific filing if

(a) the eligible institutional investor files a report under this Part at the time that the joint actor is required to file; and

(b) the report discloses the information concerning the joint actor required by this Instrument.


National Instrument 62-103 The Early Warning System and Related Takeover Bid and Insider Reporting Issues
Part 5 Aggregation Relief
Section 5.1

Separate Business Units

An eligible institutional investor, or an affiliate or associate of an eligible institutional investor, that conducts business or investment activities through business units may, for the purposes of the applicable provisions and securities legislation related to the applicable definitions, treat securities that are owned or controlled through a business unit, or securities into which those securities are convertible, exerciseable or exchangeable, separately from securities owned or controlled through any other of its business units if

(a) decisions on each of the acquisition, disposition, holding or voting of the securities owned or controlled by a business unit are made in all circumstances by that business unit;

(b) the business unit is not a joint actor with any other business unit with respect to the securities, determined without regard to the provisions of securities legislation that deem an affiliate, and presume an associate, to be acting jointly or in concert with an acquiror;

(c) no entity that makes, advises on, participates in the formulation of, or exercises influence over, decisions on the acquisition, disposition, holding or voting of securities owned or controlled by or on behalf of a business unit also makes, advises on, participates in the formulation of or exercises influence over, decisions on the acquisition, disposition, holding or voting of securities owned or controlled by or on behalf of any other business unit, except for the purposes of

(i) preparing research reports,

(ii) monitoring or ensuring compliance with regulatory requirements, or

(iii) setting, monitoring or ensuring compliance with general investment policies, guidelines, objectives or restrictions;

(d) the eligible institutional investor or affiliate or associate has reasonable grounds for believing that each business unit complies with the applicable provisions and securities legislation related to the applicable definitions in connection with the securities owned or controlled by the business unit;

(e) the eligible institutional investor or affiliate or associate has taken reasonable steps to ensure that each business unit complies with the requirements of this Part; and

(f) the eligible institutional investor or affiliate or associate complies with section 5.3.


National Instrument 62-103 The Early Warning System and Related Takeover Bid and Insider Reporting Issues
Part 7 Underwriting Exemption
Section 7.1

Underwriting Exemption

An entity is exempt from the early warning requirements and the obligation to report under Part 4 in respect of securities owned by the entity in its capacity as underwriter or securities into which those securities are convertible, or exerciseable or exchangeable, during the underwriting period, if

(a) the entity is engaged in the business of an underwriter of securities; and

(b) the entity or the issuer of the securities has issued and filed a news release that

(i) announces the proposed underwriting, and

(ii) identifies the reporting issuer and the designation and number or principal amount of the securities underwritten.


National Instrument 62-103 The Early Warning System and Related Takeover Bid and Insider Reporting Issues
Part 1 Definitions and Interpretation
Section 1.1 Definitions

securityholding percentage

securityholding percentage” means, in relation to an entity and a class of securities, the percentage of the outstanding securities of the class owned, together with the percentage controlled by the entity, determined in accordance with the provisions of applicable securities legislation listed in Appendix D and after application of any aggregation relief available under Part 5 that is relied on by the entity;


National Instrument 62-103 The Early Warning System and Related Takeover Bid and Insider Reporting Issues
Part 4 Alternative Monthly Reporting System
Section 4.5

Filing Obligations under this Part

In order to rely on the exemption provided by section 4.1, an eligible institutional investor shall file a report

(a) within 10 days after the end of the month in which the eligible institutional investor elected to begin to file reports for the reporting issuer under this Part, if the securityholding percentage of the eligible institutional investor in a class of voting or equity securities of the reporting issuer at the end of the month is 10 percent or more;

(b) within 10 days after the end of the month in which the securityholding percentage of the eligible institutional investor in a class of voting or equity securities of the reporting issuer, as at the end of the month, increased to 10 percent or more;

(c) within 10 days after the end of the month in which the securityholding percentage of the eligible institutional investor in a class of voting or equity securities of the reporting issuer, as at the end of the month, increased or decreased past thresholds that are products of whole numbers multiplied by 2.5 percent of the outstanding securities of the class and that are in excess of 10 percent of the outstanding securities of the class; and

(d) within 10 days after the end of the month in which the securityholding percentage of the eligible institutional investor in a class of voting or equity securities of the reporting issuer, as at the end of the month, decreased to less than 10 percent.


National Instrument 62-103 The Early Warning System and Related Takeover Bid and Insider Reporting Issues
Part 4 Alternative Monthly Reporting System
Section 4.7

Contents of Reports

(1) A report filed under this Part shall contain the information required by Form 62-103F3 Required Disclosure by an Eligible Institutional Investor under Part 4.

(2) Despite subsection (1), a report filed under paragraph 4.5(d) may be limited to

(a) the name and address of the eligible institutional investor;

(b) the name of the reporting issuer and the designation and number or principal amount of voting or equity securities of the reporting issuer in respect of which the report is being filed and the securityholding percentage of the eligible institutional investor in the class of securities; and

(c) a statement that the eligible institutional investor is eligible to file reports under this Part.


National Instrument 62-103 The Early Warning System and Related Takeover Bid and Insider Reporting Issues
Part 10 Moratorium Relief
Section 10.1

Moratorium Relief

(1) An entity is exempt from the moratorium provisions in respect of the acquisition of, or offers to acquire, securities, if those acquisitions or offers are made by an investment manager acting on behalf of the entity without the direction or prior knowledge of the entity.

(2) Subsection (1) does not apply to an investment manager acting as principal.

(3) An entity is exempt from the moratorium provisions in respect of any acquisitions of, or offers to acquire, securities made solely in its capacity as an approved specialist, or market maker, recognized by a stock exchange or an over-the-counter market that represents a published market for the securities.

(4) An eligible institutional investor is exempt from the moratorium provisions in respect of securities of a reporting issuer at any time in which

(a) the eligible institutional investor is using the exemption in section 4.1 in connection with filings relating to securities of that reporting issuer; or

(b) the eligible institutional investor is subject to the restrictions contained in section 4.4.


National Instrument 62-103 The Early Warning System and Related Takeover Bid and Insider Reporting Issues
Part 4 Alternative Monthly Reporting System
Section 4.2

Disqualification

(1) An eligible institutional investor shall not file reports under this Part for a reporting issuer if the eligible institutional investor, or a joint actor

(a) makes or intends to make a formal bid for securities of the reporting issuer;

(b) proposes or intends to propose a reorganization, amalgamation, merger, arrangement or similar business combination with a reporting issuer that if completed would reasonably be expected to result in the eligible institutional investor, either alone or together with any joint actors, possessing effective control over the reporting issuer or a successor to all or a part of the business of the reporting issuer; or

(c) solicits proxies from securityholders of the reporting issuer in any of the following circumstances:

(i) in support of the election of one or more persons as directors of the reporting issuer other than the persons proposed to be nominated by management of the reporting issuer;

(ii) in support for a reorganization, amalgamation, merger, arrangement or other similar corporate action involving the securities of the reporting issuer if that action is not supported by management of the reporting issuer;

(iii) in opposition to a reorganization, amalgamation, merger, arrangement or other similar corporate action involving the securities of the reporting issuer if that action is proposed by management of the reporting issuer.

(2) For the purposes of this section, “solicit” has the meaning ascribed to that term in National Instrument 51-102 Continuous Disclosure Obligations.


National Instrument 55-104 Insider Reporting Requirements and Exemptions
Part 1 Definitions and Interpretation
Section 1.3

Reliance on Reported Outstanding Shares

(1) In determining the securityholding percentage of a person or company in a class of securities for the purposes of the definition “significant shareholder” and in determining if the person or company is a significant shareholder based on post-conversion beneficial ownership, the person or company may rely upon information most recently filed by the issuer of the securities in a material change report or under section 5.4 of National Instrument 51-102 Continuous Disclosure Obligations, whichever contains the most recent relevant information.

(2) Subsection (1) does not apply if the person or company has knowledge both

(a) that the information filed is inaccurate or has changed; and

(b) of the correct information.


National Instrument 62-103 The Early Warning System and Related Takeover Bid and Insider Reporting Issues
Part 1 Definitions and Interpretation
Section 1.1 Definitions

acquisition announcement provisions

acquisition announcement provisions” means the requirement in securities legislation for an acquiror to issue a news release if, during a formal bid for voting or equity securities of a reporting issuer by an entity other than the acquiror, the acquiror acquires ownership of, or control over, securities of the class subject to the bid that, together with the acquiror’s securities of the class, constitute an amount equal to or greater than the amount specified in securities legislation;


National Instrument 62-103 The Early Warning System and Related Takeover Bid and Insider Reporting Issues
Part 1 Definitions and Interpretation
Section 1.1 Definitions

eligible institutional investor

eligible institutional investor” means

(a) a financial institution,

(b) a pension fund that is regulated by either the Office of the Superintendent of Financial Institutions (Canada), a pension commission of a jurisdiction, or a similar regulatory authority,

(c) a mutual fund that is not a reporting issuer,

(d) an investment manager in relation to securities over which it exercises discretion to vote, acquire or dispose without the express consent of the beneficial owner, subject to applicable legal requirements, general investment policies, guidelines, objectives or restrictions, or

(e) an entity referred to in clauses (D) or (F) of Rule 13d1(b)(1)(ii) under the 1934 Act;


National Instrument 62-104 Takeover Bids and Issuer Bids
Part 5 Reports and Announcements Of Acquisitions
Section 5.2

Early warning

(1) An acquiror who acquires beneficial ownership of, or control or direction over, voting or equity securities of any class of a reporting issuer, or securities convertible into voting or equity securities of any class of a reporting issuer, that, together with the acquiror’s securities of that class, constitute 10% or more of the outstanding securities of that class, must

(a) promptly, and, in any event, no later than the opening of trading on the business day following the acquisition, issue and file a news release containing the information required by section 3.1 of National Instrument 62-103 The Early Warning System and Related Take-Over Bid and Insider Reporting Issues, and

(b) promptly, and, in any event, no later than 2 business days from the date of the acquisition, file a report containing the information required by section 3.1 of National Instrument 62-103 The Early Warning System and Related Take-Over Bid and Insider Reporting Issues.

(2) An acquiror who is required to make disclosure under subsection (1) must make further disclosure, in accordance with subsection (1), each time any of the following events occur:

(a) the acquiror or any person acting jointly or in concert with the acquiror, acquires or disposes beneficial ownership of, or acquires or ceases to have control or direction over, either of the following:

(i) securities in an amount equal to 2% or more of the outstanding securities of the class of securities that was the subject of the most recent report required to be filed by the acquiror under subsection (1) or under this subsection;

(ii) securities convertible into 2% or more of the outstanding securities referred to in subparagraph (i);

(b) there is a change in a material fact contained in the most recent report required to be filed under paragraph (1)(b) or under paragraph (a) of this subsection.

(3) An acquiror must issue and file a news release and file a report in accordance with subsection (1) if beneficial ownership of, or control or direction over, the outstanding securities of the class of securities that was the subject of the most recent report required to be filed by the acquiror under this section decreases to less than 10%.

(4) If an acquiror issues and files a news release and files a report under subsection (3), the requirements under subsection (2) do not apply unless subsection (1) applies in respect of a subsequent acquisition of beneficial ownership of, or control or direction over, voting or equity securities of any class of a reporting issuer, or securities convertible into voting or equity securities of any class of a reporting issuer, that, together with the acquiror’s securities of that class, constitute 10% or more of the outstanding securities of that class.


National Policy 62-203 Take-Over Bids and Issuer Bids
Part 3 Take-Over Bid and Early Warning Requirements
Section 3.1

Equity swap or similar derivative arrangement

An investor that is a party to an equity swap or similar derivative arrangement may under certain circumstances have deemed beneficial ownership, or control or direction, over the referenced voting or equity securities. This could occur where the investor has the ability, formally or informally, to obtain the voting or equity securities or to direct the voting of voting securities held by any counterparties to the transaction. This determination would be relevant for compliance with the early warning and take-over bid requirements under the Instrument.


National Instrument 62-103 The Early Warning System and Related Takeover Bid and Insider Reporting Issues
Part 1 Definitions and Interpretation
Section 1.2

Deemed Effective Control

For the purposes of the definition of “effective control”, an entity that, either alone or together with one or more joint actors, owns or controls voting securities carrying more than 30 percent of the votes attached to all of the outstanding voting securities of a reporting issuer shall, in the absence of evidence to the contrary, be deemed to possess effective control over the reporting issuer.


National Instrument 62-103 The Early Warning System and Related Takeover Bid and Insider Reporting Issues
Appendix D

Appendix D – Beneficial Ownership

ALBERTA Sections 5 and 6 of the Securities Act (Alberta) and sections 1.8 and 1.9 of NI 62-104

BRITISH COLUMBIA Subsection 1(4) of the Securities Act (British Columbia) and sections 1.8 and 1.9 of NI 62-104

MANITOBA Subsections 1(6) and 1(7) of the Securities Act (Manitoba) and sections 1.8 and 1.9 of NI 62-104

NEW BRUNSWICK Subsections 1(5) and 1(6) of the Securities Act (New Brunswick) and sections 1.8 and 1.9 of NI 62-104

NEWFOUNDLAND AND LABRADOR Subsections 2(5) and 2(6) of the Securities Act (Newfoundland and Labrador) and sections 1.8 and 1.9 of NI 62-104

NORTHWEST TERRITORIES Section 11 of the Securities Act (Northwest Territories) and sections 1.8 and 1.9 of NI 62-104

NUNAVUT Section 11 of the Securities Act (Nunavut) and Sections 1.8 and 1.9 of NI 62-104

NOVA SCOTIA Subsections 2(5) and 2(6) of the Securities Act (Nova Scotia) and sections 1.8 and 1.9 of NI 62-104

ONTARIO Subsections 1(5) and 1(6) of the Securities Act (Ontario) and sections 1.8 and 1.9 of NI 62-104

PRINCE EDWARD ISLAND Section 11 of the Securities Act (Prince Edward Island) and sections 1.8 and 1.9 of NI 62-104

QUEBEC Sections 1.8 and 1.9 of NI 62-104

SASKATCHEWAN Subsections 2(5) and 2(6) of The Securities Act, 1988 (Saskatchewan) and sections 1.8 and 1.9 of NI 62-104

YUKON TERRITORY Section 11 of the Securities Act (Yukon Territory) and sections 1.8 and 1.9 of NI 62-104


National Instrument 62-103 The Early Warning System and Related Takeover Bid and Insider Reporting Issues
Part 1 Definitions and Interpretation
Section 1.1 Definitions

control

control” means, for a security

(a) when used in connection with the insider reporting requirements, the take-over bid requirements and related definitions and the early warning requirements, the power to exercise control or direction over the security, or similar term or expression used in securities legislation; and

(b) when used in connection with the control block distribution definition, holding the security, or similar term or expression used in securities legislation;


CSA Staff Notice 55-316 Questions and Answers on Insider Reporting and SEDI
4 Insider Information
4.1 General
Section 4.1.12

What If I Already Have An Insider Profile And Need To Add New Reportable Securities Or Related Financial Instruments?

We recommend that you file an opening balance for the new reportable security or related financial instrument and add a note in the general remarks field to explain that the balance reflects what you held on a specific date (e.g. April 30, 2010, the date NI 55-104 came into effect) rather than what you held on the date you became an insider.


Form 62-103F1 Required Disclosure under the Early Warning Requirements
Item 3

Interest in Securities of the Reporting Issuer

3.1 State the designation and number or principal amount of securities acquired or disposed of that triggered the requirement to file this report and the change in the acquiror’s securityholding percentage in the class of securities.

3.2 State whether the acquiror acquired or disposed ownership of, or acquired or ceased to have control over, the securities that triggered the requirement to file this report.

3.3 If the transaction involved a securities lending arrangement, state that fact.

3.4 State the designation and number or principal amount of securities and the acquiror’s securityholding percentage in the class of securities, immediately before and after the transaction or other occurrence that triggered the requirement to file this report.

3.5 State the designation and number or principal amount of securities and the acquiror’s securityholding percentage in the class of securities referred to in Item 3.4 over which

(a) the acquiror, either alone or together with any joint actors, has ownership and control,

(b) the acquiror, either alone or together with any joint actors, has ownership but control is held by persons or companies other than the acquiror or anyjoint actor, and

(c) the acquiror, either alone or together with any joint actors, has exclusive or shared control but does not have ownership.

3.6 If the acquiror or any of its joint actors has an interest in, or right or obligation associated with, a related financial instrument involving a security of the class of securities in respect of which disclosure is required under this item, describe the material terms of the related financial instrument and its impact on the acquiror’s securityholdings.

3.7 If the acquiror or any of its joint actors is a party to a securities lending arrangement involving a security of the class of securities in respect of which disclosure is required under this item, describe the material terms of the arrangement including the duration of the arrangement, the number or principal amount of securities involved and any right to recall the securities or identical securities that have been transferred or lent under the arrangement.

State if the securities lending arrangement is subject to the exception provided in section 5.7 of NI 62-104.

3.8 If the acquiror or any of its joint actors is a party to an agreement, arrangement or understanding that has the effect of altering, directly or indirectly, the acquiror’s economic exposure to the security of the class of securities to which this report relates, describe the material terms of the agreement, arrangement or understanding.

INSTRUCTIONS

(i) “Related financial instrument” has the meaning ascribed to that term in NI 55-104. Item 3.6 encompasses disclosure of agreements, arrangements orunderstandings where the economic interest related to a security beneficiallyowned or controlled has been altered.

(ii) For the purposes of Items 3.6, 3.7 and 3.8, a material term of an agreement, arrangement or understanding does not include the identity of the counterparty or proprietary or commercially sensitive information.

(iii) For the purposes of Item 3.8, any agreements, arrangements or understandings that have been disclosed under other items in this Form do not have to be disclosed under this item.


Form 62-103F3 Required Disclosure by an Eligible Institutional Investor under Part 4
Item 3

Interest in Securities of the Reporting Issuer

3.1 State the designation and the net increase or decrease in the number or principal amount of securities, and in the eligible institutional investor’s securityholding percentage in the class of securities, since the last report filed by the eligible institutional investor under Part 4 or the early warning requirements.

3.2 State the designation and number or principal amount of securities and the eligible institutional investor’s securityholding percentage in the class of securities at the end of the month for which the report is made.

3.3 If the transaction involved a securities lending arrangement, state that fact.

3.4 State the designation and number or principal amount of securities and the percentage of outstanding securities of the class of securities to which this report relates and over which

(a) the eligible institutional investor, either alone or together with any joint actors, has ownership and control,

(b) the eligible institutional investor, either alone or together with any joint actors, has ownership but control is held by persons or companies other than the eligible institutional investor or any joint actor, and

(c) the eligible institutional investor, either alone or together with any joint actors, has exclusive or shared control but does not have ownership.

3.5 If the eligible institutional investor or any of its joint actors has an interest in, or right or obligation associated with, a related financial instrument involving a security of the class of securities in respect of which disclosure is required under this item, describe the material terms of the related financial instrument and its impact on the eligible institutional investor’s securityholdings.

3.6 If the eligible institutional investor or any of its joint actors is a party to a securities lending arrangement involving a security of the class of securities in respect of which disclosure is required under this item, describe the material terms of the arrangement including the duration of the arrangement, the number or principal amount of securities involved and any right to recall the securities or identical securities that have been transferred or lent under the arrangement. State if the securities lending arrangement is subject to the exception provided in section 5.7 of NI 62-104.

3.7 If the eligible institutional investor or any of its joint actors is a party to an agreement, arrangement or understanding that has the effect of altering, directly or indirectly, the eligible institutional investor’s economic exposure to the security of the class of securities to which this report relates, describe the material terms of the agreement, arrangement or understanding.

INSTRUCTIONS

(i) “Related financial instrument” has the meaning ascribed to that term in NI 55-104. Item 3.5 encompasses disclosure of agreements, arrangements or understandings where the economic interest related to a security beneficially owned or controlled has been altered.

(ii) An eligible institutional investor may omit the securityholding percentage from a report if the change in percentage is less than 1% of the class.

(iii) For the purposes of Items 3.5, 3.6 and 3.7, a material term of an agreement, arrangement or understanding does not include the identity of the counterparty or proprietary or commercially sensitive information.

(iv) For the purposes of Item 3.7, any agreements, arrangements or understandings that have been disclosed under other items in this Form do not have to be disclosed under this item.


Ontario Securities Act
Part XXI Insider Trading and Self-Dealing
Section 106(2)

Same

(2) For the purpose of this Part,

(a) any issuer in which an investment fund holds in excess of 10 per cent of the voting securities or in which the investment fund and related investment funds hold in excess of 20 per cent of the voting securities shall be deemed to be a related person or company of that investment fund or of each of those investment funds; and

(b) the acquisition or disposition by an insider of a put, call or other transferable option with respect to a security shall be deemed to be a change in the beneficial ownership of the security to which such put, call or other transferable option relates.


National Instrument 55-104 Insider Reporting Requirements and Exemptions
Part 1 Definitions and Interpretation
Section 1.1(1)

significant shareholder

significant shareholder” means a person or company that has beneficial ownership of, or control or direction over, whether direct or indirect, or a combination of beneficial ownership of, and control or direction over, whether direct or indirect, securities of an issuer carrying more than 10 per cent of the voting rights attached to all the issuer’s outstanding voting securities, excluding, for the purpose of the calculation of the percentage held, any securities held by the person or company as underwriter in the course of a distribution;


National Instrument 62-103 The Early Warning System and Related Takeover Bid and Insider Reporting Issues
Appendix A

Appendix A – Control Block Distribution Definition

ALBERTA Clause 1(p)(iii) of the Securities Act (Alberta)

BRITISH COLUMBIA Paragraph (c) of the definition of “distribution” contained in subsection 1(1) of the Securities Act (British Columbia)

MANITOBA Paragraph 1(b) of the definition of “primary distribution to the public” contained in subsection 1(1) of the Securities Act (Manitoba)

NEW BRUNSWICK Paragraph (c) of the definition of “distribution” contained in section 1(1) of the Securities Act (New Brunswick)

NEWFOUNDLAND Clause 2(1)(l)(iii) of the Securities Act (Newfoundland)

NORTHWEST TERRITORIES Paragraph (c) of the definition of “distribution” contained in subsection 1(1) of the Securities Act (Northwest Territories)

NUNAVUT Paragraph (c) of the definition of “distribution” contained in subsection 1(1) of the Securities Act (Nunavut)

NOVA SCOTIA Clause 2(1)(l)(iii) of the Securities Act (Nova Scotia)

ONTARIO Paragraph (c) of the definition of “distribution” contained in subsection 1(1) of the Securities Act (Ontario)

PRINCE EDWARD Subclause (iii) of the definition of “distribution” contained in clause 1(k) of the Securities Act (Prince Edward Island)

QUEBEC Subparagraph 9 of the definition of “distribution” contained in section 5 of the Securities Act (Quebec)

SASKATCHEWAN Subclause 2(1)(r)(iii) of The Securities Act, 1988 (Saskatchewan)

YUKON TERRITORY Paragraph (c) of the definition of “distribution” contained in subsection 1(1) of the Securities Act (Yukon Territory)


National Instrument 62-103 The Early Warning System and Related Takeover Bid and Insider Reporting Issues
Part 1 Definitions and Interpretation
Section 1.1 Definitions

financial institution

financial institution” means

(a) a Canadian financial institution,

(b) an entity that is engaged in financial services activities and that is supervised and regulated under the banking, insurance, trust or similar laws of, and incorporated in, the United States of America or Japan, or

(c) a credit institution, within the meaning of European Union Directive 77/780/EEC, whose home member state for purposes of that European Union Directive is France, Germany, Italy or the United Kingdom of Great Britain and Northern Ireland;


CSA Staff Notice 55-316 Questions and Answers on Insider Reporting and SEDI
4 Insider Information
4.5 Reporting Transactions
Section 4.5.3

If I Acquire Securities Through An Employee Share Ownership Plan (Esop) Or A Dividend Reinvestment Plan (Drip), Do I Hold These Securities Directly Or Indirectly (Do I Indicate The “Registered Owner” On My Report)?

Whether or not you should indicate the ESOP or DRIP as the “registered owner” depends on whether the ESOP or DRIP is the “beneficial owner” of, or has control over, the securities. The answer may be different depending on the terms of the particular plan. If you have the right to vote or sell securities held in a plan, you would normally be considered to hold these securities directly. You should speak to your employer to find out whether the ESOP or DRIP is the registered owner, or whether you hold these securities directly.


National Instrument 62-103 The Early Warning System and Related Takeover Bid and Insider Reporting Issues
Part 1 Definitions and Interpretation
Section 1.1 Definitions

investment manager

investment manager” means an entity that

(a) either

(i) is registered or licensed to provide investment counselling, portfolio management or similar advisory services in respect of securities, or is exempt from the requirement to be so registered or licensed, under the securities laws of a jurisdiction or of Japan or under the Investment Advisers Act of 1940 of the United States of America, as amended, or

(ii) is subject to European Union Directive 93/22 on investment services in the securities field, and provides the portfolio management services referred to in Section A(3) of the Annex to that Directive, and whose home member state is France, Germany, Italy or the United Kingdom of Great Britain and Northern Ireland, and

(b) provides the services referred to in paragraph (a) for valuable consideration under a contractual arrangement;


CSA Staff Notice 55-312 Insider Reporting Guidelines for Certain Derivative Transactions (Equity Monetization)
Examples

Example 1

On March 1, 2011, John enters into a forward contract with InvestBank under which John agrees to sell, and InvestBank agrees to purchase, 10 shares of ABC Inc. at a price of $109.50 per share. [FN 2] The sale will take place on March 1, 2016. The parties may settle their obligations under the forward contract on a cash settlement basis or by physical delivery of 10 ABC Inc. shares. This contract may be settled at an earlier date, subject to an adjustment to the settlement price. InvestBank hedges its risk under the forward contract through a hedging strategy involving short sales into the secondary market.

Insider Reporting Requirement: John is required to file an insider report within five (calendar) days of March 1, 2011. (See Part 3 of NI 55-104.) For an example of how this transaction would be reported, see below. Unless InvestBank is also a reporting insider of ABC Inc., InvestBank is not required to file an insider report.

Instructions for Example 1

Note: John has accessed the SEDI website at www.sedi.ca, selected “English” as his language of preference, selected “login” at the “Welcome to SEDI” screen, and has logged in by entering his SEDI user ID and his password. John will now see the following screen: “Insider home page”.

1. Enter your insider access key and click Next.

SCREEN: Insider activities

2. Click Insider report (at the top of the screen).

SCREEN: Introduction to insider report activities (Form 55-102F2)

3. Click File insider report (on the navigation bar at the left of the screen)

SCREEN: File insider report (Form 55-102F2) – Select issuer

4. Select and highlight “ABC Inc.” in the list of issuers from the insider profile.

5. Click File insider report.

SCREEN: File insider report – Select security designation 

6. Click on Add insider-defined security (at the bottom of the screen).

Note: Since the forward contract is not a class of security defined by the issuer in its issuer profile supplement, it will be necessary for John to create a new insider-defined security designation for the forward contract.

Note: In SEDI, third-party derivative arrangements are considered to be “securities”. Such arrangements may or may not be considered “securities” under securities law generally, depending upon the facts and circumstances of the arrangement in question. To the extent derivative instruments do not, as a matter of law, constitute securities, they will generally be related financial instruments. See commentary in subsection 1.4(6) of 55-104CP. For insider reporting purposes, it is not necessary to determine whether a derivative instrument is a security or a related financial instrument since both are subject to insider reporting requirements under Part 3 of NI 55-104.

SCREEN: Pop-up warning

Note: At this point, a warning pop-up box should appear: “Warning: You are about to specify an insider-defined security. You must ensure that the security is not already listed.”

7. Click OK.

SCREEN: File insider report – Add insider-defined security designation

8. Use the drop-down menu under the heading Security category, select and highlight Third Party Derivatives.

9. Under the heading Security designation, in the drop-down menu under the subheading Security name, select and highlight Forward Sale.

10. Then, for the Additional description, briefly describe. For example, “10 common shares – settlement date March 2016”.

Note: This adds the security designation “Forward sale (10 common shares – settlement date March 2016)” to your list of insider-defined securities.

Note: Not all of this text will currently be visible in the Additional description box. (The box will only show a limited number of characters at any one time.) However, the full text in this example will be accepted, and will be visible at later stages of the filing process.

11. Under the heading Underlying security designation, in the drop-down menu under the subheading Security category, select and highlight Equity.

12. Then, in the drop-down menu under the subheading Security name, select and highlight Common Shares.

Note: In the context of a forward sale, the underlying security is the security that is the subject of the forward sale.

13. Click Next.

SCREEN: File insider report – Select ownership type

14. In the drop-down menu Ownership type, select and highlight Direct Ownership and click Next.

SCREEN: File insider report – opening balance on initial SEDI report

Note: SEDI requires an opening balance for each type of security. This has to be entered before a report can be filed about a transaction in the security. If the reporting insider has never filed a report about this specific type of security, the reporting insider must enter 0 (zero) as the opening balance. If John has previously entered into another forward contract that has different terms (e.g., a different settlement date or price) from the present forward contract, the present contract would be considered a separate type of security.

15. In the field Opening balance of securities or contracts held, enter 0.

16. In the field Opening balance of equivalent number or value of underlying securities, enter 0.

Note: This screen contains additional fields: General remarks and Private remarks to securities regulatory authorities. In this example, it is not necessary to include any information here.

17. Click Next (at the bottom of the screen).

SCREEN: File insider report – Final review

18. Click Certify.

SCREEN: Certification

19. Click OK to Accept.

SCREEN: File insider report – Completed

Note: John has now filed his opening balance for the security designated “Forward sale (10 common shares – settlement date March 2016)”. It is now necessary to file a report about the transaction involving this security entered into on March 1, 2011.

20. At the prompt “File another transaction?” click Yes.

SCREEN: File insider report – Select a transaction option

Note: Make sure “Same security & holder” is selected.

SCREEN: File insider report – Enter transaction information

21. In the Date of transaction field, select March 1, 2011.

Note: Since John entered into the forward contract on March 1, 2011, enter this date. Do not enter the date of the anticipated settlement (i.e., March 1, 2016) here.

22. In the drop-down menu Nature of transaction, select and highlight the appropriate code. Since John has acquired rights and obligations under a derivative contract, select “70 – Acquisition or disposition (writing) of third party derivative”.

Note: For information about “nature of transaction” codes, see the online help function on SEDI.

23. Enter a number in the Number or value of securities or contracts acquired field. Enter 1 here.

Note: Since John has acquired rights and obligations under a derivative contract, enter 1 after the field Number or value of securities or contracts acquired. Leave the Number or value of securities or contracts disposed of field blank.

Note: Since John has specified a derivative as the security, there are additional fields in which to enter the equivalent number or value of the underlying securities to which the derivative relates.

24. Enter a number in the Equivalent number or value of underlying securities disposed of field. Enter 10 here.

25. Next to the field Unit price or exercise price, click the Not Applicable box.

26. In the field Conversion or exercise price, enter 109.50.

Note: Since John has not paid any consideration (in this example) for the forward contract, he would click the Not Applicable box next to the field Unit price or exercise price. Since the forward contract obliges John to sell 10 ABC Inc. shares at $109.50 per share on March 1, 2016, John would enter 109.50 in the field Conversion or exercise price.

27. In the Date of expiry or maturity field, select March 1, 2016.

Note: Since the anticipated date of settlement is March 1, 2016, this will be the date of expiry or maturity.

28. Enter the following information in the General remarks field:

Forward contract to sell 10 shares at $109.50 per share on March 1, 2016. Contract may be settled by cash or by delivery of 10 shares. Contract may be settled at earlier date, subject to price adjustment.

Note: If it is not possible to adequately describe a transaction or to include all of the material terms of a transaction in the space provided, consider making reference to a public document (e.g., a news release issued by the issuer) that further describes the transaction. Alternatively, this information may be included in a schedule that may be filed in paper format by facsimile in accordance with the provisions of Part 3 of NI 55-102. Fax the schedule to the facsimile number of the securities commission set out on Form 55-102F6. We recommend that you make reference to this filing by facsimile in the General remarks field on SEDI. Staff will make this schedule available to the public on request.

29. Enter additional information, as necessary, in the Private remarks to securities regulatory authorities field.

Note: This is an optional field. These remarks will only be accessible by securities regulatory authorities. Leave this field blank if no remarks are necessary.

SUMMARY – The information should appear as follows:

30. Click Next.

SCREEN: File insider report – Final review

31. Ensure that the details of your report are complete and accurate.

32. Click Certify (at the bottom of the screen).

SCREEN: Certification Pop-Up

33. Review the certification information carefully.

34. Click OK to accept.

SCREEN: File insider report -Completed

35. At the prompt “File another transaction?” click No.

36. Logout

John has now completed the filing of his insider report relating to the forward contract. This report will normally be publicly available on SEDI within five minutes of filing.

Note: Generally, where a reporting insider files an insider report in respect of a third-party derivative such as a forward contract, the reporting insider will be required to file a second report at the time the derivative is settled, matures or otherwise closed out. For example, John in this example will be required to file an insider report within five days of March 1, 2016 (assuming that the contract settles on that date and that John is still a reporting insider on that date). The report will show i) a disposition of the forward contract, and ii) a disposition of the underlying common shares.

FN 2 In this example, $90 is assumed to represent the present value of $109.50 on March 1, 2016. Assuming an annual compounding of 4%, John and InvestBank are in the same position (absent any consideration of taxes) whether they proceed by way of a sale today at $90 or a sale five years from today at $109.50. In the case of a sale today, John receives $90, which he may then invest at 4%. Assuming an annual compounding return of 4%, at the end of five years, John will have received cash in the amount of $109.50. In the case of the forward sale at the end of five years, John will have received cash in the amount of $109.50.


Form 55-102F2 Insider Report
Section 20

Opening Balance of Equivalent Number of Underlying Securities (Initial SEDI Report Only)

If the insider is filing an initial report of an option, warrant, right or other derivative held on becoming an insider or is reporting a change in any such derivative not previously reported in SEDI format, for each such derivative position held directly or by a particular registered holder, disclose the actual or notional number or amount of underlying securities that may be acquired or disposed of upon exercise or settlement of such derivative. If the underlying securities are debt securities, provide the aggregate nominal value of the actual or notional amount of underlying debt securities that may be acquired or disposed of upon exercise or settlement of such derivative.


CSA Staff Notice 55-316 Questions and Answers on Insider Reporting and SEDI
4 Insider Information
4.1 General
Section 4.1.11

As A Reporting Insider, Do I Need To Report Securities And Related Financial Instruments That My Spouse Owns Or Controls?

As a reporting insider of a SEDI issuer, you need to report any securities and any related financial instruments of that SEDI issuer that your spouse (or any other person) owns if you have or share control or direction, whether direct or indirect, over those securities or related financial instruments.

A person will generally have or share control or direction over securities if the person directly or indirectly through any contract, arrangement, understanding or relationship or otherwise has or shares

  • voting power, which includes the power to vote, or to direct the voting of, such securities and/or
  • investment power, which includes the power to acquire or dispose, or to direct the acquisition or disposition of such securities.

Form 62-103F1 Required Disclosure under the Early Warning Requirements
Item 6

Agreements, Arrangements, Commitments or Understandings With Respect to Securities of the Reporting Issuer

Describe the material terms of any agreements, arrangements, commitments or understandings between the acquiror and a joint actor and among those persons and any person with respect to securities of the class of securities to which this report relates, including but not limited to the transfer or the voting of any of the securities, finder’s fees, joint ventures, loan or option arrangements, guarantees of profits, division of profits or loss, or the giving or withholding of proxies. Include such information for any of the securities that are pledged or otherwise subject to a contingency, the occurrence of which would give another person voting power or investment power over such securities, except that disclosure of standard default and similar provisions contained in loan agreements need not be included.

INSTRUCTIONS

(i) Agreements, arrangements or understandings that are described under Item 3 do not have to be disclosed under this item.

(ii) For the purposes of Item 6, the description of any agreements, arrangements, commitments or understandings does not include naming the persons with whom those agreements, arrangements, commitments or understandings have been entered into, or proprietary or commercially sensitive information.


Form 62-103F1 Required Disclosure under the Early Warning Requirements
Item 4

Consideration Paid

4.1 State the value, in Canadian dollars, of any consideration paid or received per security and in total.

4.2 In the case of a transaction or other occurrence that did not take place on a stock exchange or other market that represents a published market for the securities, including an issuance from treasury, disclose the nature and value, in Canadian dollars, of the consideration paid or received by the acquiror.

4.3 If the securities were acquired or disposed of other than by purchase or sale, describe the method of acquisition or disposition.