The Ontario Securities Commission (OSC) has granted Brookfield Reinsurance Ltd. (the Filer) an exemption from the requirement under paragraph 9.3(1)(b) of National Instrument 44-102 Shelf Distributions (NI 44-102), which stipulates that only equity securities can be distributed via at-the-market (ATM) distributions using shelf procedures. The exemption pertains to the Filer’s Class A-1 exchangeable non-voting shares (Class A-1 Exchangeable Shares), which are economically and functionally equivalent to Brookfield Corporation’s class A limited voting shares (Brookfield Class A Shares) and convertible into class A exchangeable limited voting shares of the Filer (Class A Exchangeable Shares).
The OSC’s decision is based on the understanding that the Class A-1 Exchangeable Shares, while not carrying a residual right to participate in the company’s assets upon liquidation or winding-up (and thus not qualifying as equity securities under the Legislation), offer an economic return equivalent to an investment in Brookfield Class A Shares, which are equity securities. The OSC concluded that granting the exemption would not be prejudicial to the public interest.
The exemption is conditional upon the Filer meeting other requirements for ATM distributions as outlined in section 9.3 of NI 44-102, the distributed securities being Class A-1 Exchangeable Shares, and the Brookfield Class A Shares qualifying as equity securities under NI 44-102. This decision is applicable across multiple Canadian jurisdictions through the passport system, as indicated by the Filer’s notice of reliance on subsection 4.7(1)(c) of Multilateral Instrument 11-102 Passport System (MI 11-102).