The Ontario Securities Commission
OSC Bulletin
November 27, 2014
Volume 37, Issue 48
(2014), 37 OSCB
The Ontario Securities Commission administers the Securities Act of Ontario (R.S.O. 1990, c. S.5) and the Commodity Futures Act of Ontario (R.S.O. 1990, c. C.20)
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Table of Contents
Chapter 1 Notices / News Releases ...... 10337 2.2 Orders ...... 10467 1.1 Notices ...... 10337 2.2.1 Bigfoot Recreation & Ski Area Ltd. 1.1.1 The Investment Funds Practitioner – and Ronald Stephen McHaffie November 2014 ...... 10337 – ss. 127(1), 127(10)...... 10467 1.1.2 Ontario Securities Commission, 2.2.2 Pro-Financial Asset Management Inc...... 10468 Investment Funds and Structured 2.2.3 TG Residential Value Properties Ltd. Products Branch – – ss. 127(7), 127(8)...... 10476 IFRS Release No. 2 ...... 10341 2.2.4 TMX Group Limited et al. – s. 147 ...... 10477 1.2 Notices of Hearing ...... (nil) 2.3 Rulings ...... (nil) 1.3 News Releases ...... (nil) 1.4 Notices from the Office Chapter 3 Reasons: Decisions, Orders and of the Secretary ...... 10343 Rulings ...... (nil) 1.4.1 Bigfoot Recreation & Ski Area Ltd. 3.1 OSC Decisions, Orders and Rulings ...... (nil) and Ronald Stephen McHaffie ...... 10343 3.2 Court Decisions, Order and Rulings ...... (nil) 1.4.2 Pro-Financial Asset Management Inc...... 10343 1.4.3 TG Residential Value Properties Ltd...... 10344 Chapter 4 Cease Trading Orders ...... 10479 4.1.1 Temporary, Permanent & Rescinding Chapter 2 Decisions, Orders and Rulings ...... 10345 Issuer Cease Trading Orders ...... 10479 2.1 Decisions ...... 10345 4.2.1 Temporary, Permanent & Rescinding 2.1.1 Next Edge Capital Corp. et al...... 10345 Management Cease Trading Orders ...... 10479 2.1.2 Franklin Templeton Investments 4.2.2 Outstanding Management & Insider Corp. et al...... 10351 Cease Trading Orders ...... 10479 2.1.3 Nexans S.A...... 10356 2.1.4 American Bonanza Gold Corp...... 10362 Chapter 5 Rules and Policies ...... 10481 2.1.5 TransCanada PipeLines Limited 5.1.1 Notice of Amendments to OSC Rule and TransCanada Trust ...... 10364 45-501 Ontario Prospectus and 2.1.6 1832 Asset Management L.P...... 10368 Registration Exemptions ...... 10481 2.1.7 Aegon Fund Management Inc...... 10372 2.1.8 AlphaPro Management Inc...... 10376 Chapter 6 Request for Comments ...... 10483 2.1.9 Blackrock Asset Management 6.1.1 Proposed NI 24-102 Clearing Agency Canada Limited ...... 10380 Requirements and Related Companion 2.1.10 BMO Asset Management Inc...... 10384 Policy 24-102CP ...... 10483 2.1.11 BMO Harris Investment Management 6.1.2 Proposed Amendments to NI 45-106 Inc...... 10388 Prospectus and Registration Exemptions, 2.1.12 BMO Investments Inc...... 10392 NI 41-101 General Prospectus 2.1.13 CIBC Asset Management Inc...... 10396 Requirements, NI 44-101 Short Form 2.1.14 Canadian Imperial Bank of Commerce ...... 10400 Prospectus Distributions and NI 45-102 2.1.15 Fidelity Investments Canada ULC ...... 10404 Resale Restrictions and Proposed 2.1.16 Franklin Templeton Investments Corp...... 10408 Repeal of NI 45-101 Rights Offering ...... 10572 2.1.17 Horizons ETFs Management (Canada) Inc...... 10412 Chapter 7 Insider Reporting ...... 10573 2.1.18 Invesco Canada Ltd...... 10416 2.1.19 Mackenzie Financial Corporation ...... 10420 Chapter 8 Notice of Exempt Financings...... 10655 2.1.20 Manulife Asset Management Limited ...... 10424 Reports of Trades Submitted on 2.1.21 MD Physician Services Inc...... 10428 Forms 45-106F1 and 45-501F1 ...... 10655 2.1.22 RBC Global Asset Management Inc...... 10432 2.1.23 Sentry Investments Inc...... 10436 Chapter 9 Legislation ...... (nil) 2.1.24 TD Asset Management Inc...... 10440 2.1.25 Vanguard Investments Canada Inc...... 10444 Chapter 11 IPOs, New Issues and Secondary 2.1.26 ATB Investment Management Inc. Financings ...... 10657 et al...... 10448 2.1.27 I.G. Investment Management, Ltd...... 10452 Chapter 12 Registrations ...... 10665 2.1.28 Desjardins Investments Inc. et al...... 10456 12.1.1 Registrants ...... 10665 2.1.29 ITG Canada Corp...... 10462
November 27, 2014 (2014), 37 OSCB
Table of Contents
Chapter 13 SROs, Marketplaces, Clearing Agencies and Trade Repositories ...... (nil) 13.1 SROs...... (nil) 13.2 Marketplaces ...... (nil) 13.3 Clearing Agencies ...... (nil) 13.4 Trade Repositories ...... (nil)
Chapter 25 Other Information ...... 10667 25.1 Permissions 25.1.1 Anglo Pacific Group PLC – s. 38(3) ...... 10667
Index ...... 10669
November 27, 2014 (2014), 37 OSCB
Chapter 1
Notices / News Releases
1.1 Notices
1.1.1 The Investment Funds Practitioner – November 2014
OSC
THE INVESTMENT FUNDS PRACTITIONER
From the Investment Funds and Structured Products Branch, Ontario Securities Commission
What is the Investment Funds Practitioner?
The Practitioner is an overview of recent issues arising from applications for exemptive relief, prospectuses, and continuous disclosure documents that investment funds file with the OSC. It is intended to assist investment fund managers and their staff or advisors who regularly prepare public disclosure documents and applications for exemptive relief on behalf of investment funds.
The Practitioner is also intended to make you more broadly aware of some of the issues we have raised in connection with our reviews of documents filed with us and how we have resolved them. We hope that fund managers and their advisors will find this information useful and that the Practitioner can serve as a useful resource when preparing applications and disclosure documents.
The information contained in the Practitioner is based on particular factual circumstances. Outcomes may differ as facts change or as regulatory approaches evolve. We will continue to assess each case on its own merits.
The Practitioner has been prepared by staff of the Investment Funds and Structured Products Branch and the views it expresses do not necessarily reflect the views of the Commission or the Canadian Securities Administrators.
Request for Feedback
This is the 13th edition of the Practitioner. Previous editions of the Practitioner are available on the OSC website www.osc.gov.on.ca under Investment Funds. We welcome your feedback and any suggestions for topics that you would like us to cover in future editions. Please forward your comments by email to [email protected].
Prospectuses
Fee-Based Series with Dual Dealer Compensation
Further to staff's continued focus on mutual fund fee structures and dealer compensation models, we have recently become aware of certain investment fund series intended for fee-based accounts that have a trailing commission embedded in the ongoing cost of the fund series.
In staff’s view, a series intended for fee-based accounts with this type of dual compensation structure is inconsistent with a critical attribute of the fee-based series, namely the negotiation of the dealer’s compensation, which is intended to provide investors with heightened transparency of the cost of the dealer’s services and a clear expectation of the services to be rendered in exchange for the negotiated fee. Having a trailing commission embedded in a fee-based series, in staff’s view, blurs the lines between the attributes of a fee-based series and the embedded fee (trailing commission) series and is potentially misleading for investors.
We have consulted with staff in the OSC’s Compliance and Registrant Regulation Branch, who further note that this practice may raise the issue of double charging by dealers, which is contrary to a dealer’s general duty to deal fairly, honestly and in good faith with its clients under OSC Rule 31-505 Conditions of Registration. Investment fund managers should be mindful of their duty to act in the best interests of their funds, and ultimately their investors, when structuring and establishing dealer compensation models.
We have indicated to filers our expectation that new funds with fee-based series not have an embedded trailing commission. Going forward, we anticipate that on the reviews of renewal prospectuses where such series are identified, staff will be asking
November 27, 2014 (2014), 37 OSCB 10337
Notices / News Releases fund managers to tell us what would be a reasonable transition period needed to: (a) cease all new investments in the series, and (b) switch or redeem current investors out of this series or remove this dual compensation structure from the series.
We continue to review and monitor developments on mutual fund fee structures and dealer compensation models and will provide further guidance as needed. Issuers and their counsel are encouraged to contact staff in the planning stage of any structure that may give rise to questions concerning this issue.
Minimum and Maximum Offering Amounts
In the November 2012 edition of the Practitioner, we reminded filers that the disclosure requirements set out in Form 41-101F2 for long form prospectuses and Forms 81-101F1 and 81-101F2 for simplified prospectuses apply to both the preliminary prospectus and the final prospectus unless otherwise specifically stated. We noted preliminary prospectuses with bulleted placeholders for items that should be disclosed at the time of the preliminary filing, such as the auditor's name in an audit report, the minimum offering amount on the cover page of a long form prospectus, expenses and fees, and the name of the custodian. In the March 2014 edition of the Practitioner, we further clarified that the management fee payable by the investment fund was included in this list, and reiterated staff's view that a preliminary prospectus should contain all material information before it is receipted at the preliminary stage.
Staff continue to review preliminary long form prospectuses that do not specify the offering size. In every case, staff expect a minimum offering amount to be disclosed in the preliminary prospectus, even if this amount is the minimum listing requirement. Filing a preliminary prospectus without a specified minimum offering amount may delay the issuance of the preliminary receipt.
We understand that it may not be possible to disclose a maximum offering size at the time the preliminary prospectus is filed, but where an investment fund manager can reasonably anticipate an offering size, that amount should be disclosed. Where a maximum offering has not been disclosed, but the investment fund manager has made certain assumptions about the offering size for the purpose of other disclosure provided in the preliminary prospectus, staff is of the view that those assumptions should be very clearly disclosed in the preliminary prospectus.
Redemption of Closed-End Fund Securities
On September 22, 2014, subsection 10.3(4) of NI 81-102 Investment Funds (NI 81-102) came into force, which requires that the redemption price of a security of a non-redeemable investment fund (NRIF) not be a price that is more than the net asset value (NAV) of the security determined on a redemption date specified in the NRIF’s prospectus or annual information form.
The purpose of this provision is to prevent dilution of the value of the other securities of an NRIF when the redemption price paid is higher than NAV. Currently, certain NRIFs permit securityholders to request, on a monthly basis, that the NRIF redeem the securities tendered for redemption at a price determined with reference to the market price of the securities (the Monthly Redemption Amount). However, this type of pricing mechanism could result in the Monthly Redemption Amount being more than the NAV of the security redeemed and, in such a situation, the NRIF would contravene subsection 10.3(4) of NI 81-102 if it honoured the monthly redemption requests.
To ensure that the calculation of the Monthly Redemption Amount is consistent with subsection 10.3(4) of NI 81-102, staff have asked in recent prospectus reviews for newly launched NRIFs, that the disclosure regarding the Monthly Redemption Amount include a statement that, in any event, the Monthly Redemption Amount will not be an amount that is more than the NAV of the investment fund.1
In staff’s view, such disclosure does not mean that the Monthly Redemption Amount is being calculated with reference to the NAV of the NRIF. Accordingly, an NRIF whose prospectus included such disclosure would not be considered by staff to be a ‘mutual fund’ under Ontario securities law.
Currency Hedging in Investment Objectives
Staff are aware that many investment funds employ currency hedging as a strategy to reduce foreign currency risk for investors. Sometimes the ability to employ currency hedging is discretionary and the investment fund’s prospectus discloses that the portfolio manager may hedge the foreign currency exposure and that the hedge may be anywhere from 0% to 100% of the fund’s foreign currency exposure. However, for other funds, the prospectus discloses that all or substantially all of the fund’s foreign currency exposure will be hedged, and that the hedging is not at the portfolio manager’s discretion.
In the second scenario discussed above, staff’s view is that the currency hedging described is an essential feature of the investment fund, and, therefore, should be disclosed in the fund’s investment objectives (as required by Instruction (3) to Item 6
1 For an example of such disclosure, see the prospectus of Energy Leaders Plus Income Fund dated September 24, 2014.
November 27, 2014 (2014), 37 OSCB 10338
Notices / News Releases of Form 81-101F1 and Instruction (3) to Item 5.1 of Form 41-101F2). Accordingly, in our prospectus reviews, we have been indicating this expectation to filers.
T+2 Settlement Cycle for European Securities
On October 6, 2014, the majority of European Economic Area markets moved to a T+2 settlement cycle for all transactions executed on trading venues. This move was made in anticipation of the implementation of new Central Securities Depositories Regulation which will require T+2 settlement in Europe as of January 1, 2015.
Since transactions in Canadian investment fund securities settle on a T+3 basis, the move to T+2 in Europe creates a time discrepancy between the settlement of transactions at the fund level and the settlement of transactions in underlying portfolio securities exchanged on European markets. This mismatch between the respective settlement cycles may raise liquidity management issues for investment funds.
We expect investment fund managers to be evaluating their ability to accommodate T+2 settlement of transactions in European securities. Specifically, investment fund managers should be mindful of the leverage restriction in paragraph 2.6(a) of NI 81-102 which limits an investment fund’s borrowings to settle portfolio transactions to no more than 5% of the fund’s net asset value. The provision further requires that each borrowing effected for this purpose be a temporary measure.
In consultation with staff in the OSC’s Compliance and Registrant Regulation Branch, we have conveyed to filers that we are of the view that borrowings effected by a fund within the 5% limit of paragraph 2.6(a) of NI 81-102 specifically to settle trades in European securities, and that as a whole, cause the fund to be in a state of overdraft over a prolonged period of time, will not be offside the restriction in paragraph 2.6(a). If, however, the borrowings effected in connection with T+2 settlement are expected to cause a fund to exceed the 5% borrowing restriction in paragraph 2.6(a), staff expect the fund to seek exemptive relief. We will consider applications for such exemptive relief on a case-by-case basis.
Staff request that as investment fund managers and portfolio managers gain experience and data operating under the T+2 settlement cycle for European securities, they share their experiences with us in order that we may better assess the impact of this change on Canadian investment funds and determine whether any regulatory action is necessary.
Disclosure of Securities Lending
On September 22, 2014, new prospectus and annual information form disclosure requirements with respect to securities lending by investment funds came into force.2 These requirements apply to both mutual funds and non-redeemable investment funds and mandate disclosure of, among other items, the identity of the fund’s securities lending agent, whether the securities lending agent is an affiliate or associate of the fund’s manager, and the essential terms of the fund’s securities lending agreement(s). We remind investment funds and their managers of these new requirements and advise that staff will be reviewing prospectus filings for this disclosure.
Continuous Disclosure
IFRS Release No. 1
In September 2014, staff commenced an issue-oriented continuous disclosure review focusing on the transition to International Financial Reporting Standards (IFRS). We reviewed the first IFRS financial statements required to be filed under National Instrument 81-106 Investment Fund Continuous Disclosure, which were the interim financial reports of investment funds with a calendar year-end. On September 30, 2014, staff issued IFRS Release No. 1 (the Release) to provide guidance to investment funds that had yet to file their first IFRS interim financial reports and related MRFPs. The Release outlined the types of deficiencies that had been identified in the course of our continuous disclosure review.
The Release is the first in a series of releases expected to be issued by staff. Upon completion of this first phase of our reviews, staff will publish our findings either by way of a release, an OSC staff notice, or another appropriate form of communication. As we expand our reviews by examining the interim financial reports of other investment funds with non-calendar year-ends and audited annual financial statements, we will issue further releases with additional guidance, as needed, in order to assist investment funds and their advisers with their IFRS filings.
2 For the prospectus disclosure requirements, see the amendments to (i) Item 5(1) of Part A of Form 81-101F1, (ii) Item 4(1) of Part B of Form 81-101F1, and (iii) Item 3.4(1) of Form 41-101F2, as well as the new Item 19.11 of Form 41-101F2. For the annual information form disclosure requirements, see the new Item 10.9.1 of Form 81-101F2.
November 27, 2014 (2014), 37 OSCB 10339
Notices / News Releases
Asset Classes Susceptible to Liquidity Concerns
The continuous disclosure review program in the Investment Funds and Structured Products Branch uses a risk-based approach in selecting issuers for review and determining areas of focus. Our program aims to be responsive to current market conditions and trends. As market conditions change, we target areas where we foresee a potential change in risk exposure. Staff are currently conducting a series of targeted reviews focused on asset classes that may be more susceptible to liquidity issues, and in particular, funds with exposure to high yield fixed income, small cap equity and emerging market issuers.
As part of our targeted reviews, we are asking fund managers to provide information about:
• their policies and procedures concerning the evaluation of liquidity levels of individual fund holdings and how the fund holdings fit within the illiquid asset restrictions for mutual funds under NI 81-102;
• the specific factors and metrics they use to assess liquidity levels, the steps that may be taken should any particular holdings run afoul of internal thresholds for such metrics, as well as information concerning the frequency of such monitoring;
• from a risk management perspective, any stress testing and scenario analysis fund managers may have conducted for their fund portfolios; and
• the valuation of illiquid assets, the valuation policies and procedures and whether there is any oversight by the fund’s independent review committee.
Upon completion of our reviews, we expect to publish our findings and provide guidance on best practices for liquidity assessment protocol, portfolio risk management and disclosure.
Senior Loans
As part of our ongoing continuous disclosure reviews focused on fixed income investment funds, as mentioned in the March 2014 edition of the Practitioner, staff have also focused on funds with exposure to senior loans. We are increasingly focused on the liquidity of senior loans and how such assets appropriately fit within the regulatory framework for investment funds, given that senior loans are not investment grade debt and have longer transaction settlement times than traditional debt securities, which can result in a mismatch between the settlement time for a senior loan and the time in which the investment fund must settle redemption requests for its securities.
As a result of our CD reviews, on recent prospectus filings, staff have been focused on the following key areas:
1. Textbox disclosure: Investment funds that have a specific mandate or invest the majority of their assets in senior loans have been asked by staff to add a textbox to the cover page of the prospectus under the name of the fund. We would expect, at a minimum, the textbox to disclose that: (a) the investment fund invests in senior loans, which are not investment grade debt, (b) settlement periods for senior loan transactions may be longer than for other types of debt securities such as corporate bonds, and (c) senior loans are not an alternative to holding cash or money market securities. Staff may also ask that this textbox disclosure be added to the summary disclosure documents for these funds, such as the Fund Facts or the summary disclosure document for exchange-traded funds.
2. Management liquidity assessments: Staff expect fund managers and portfolio managers to tell us how they will actively assess the liquidity levels of senior loan holdings, including utilizing specific metrics that can be referenced to measure liquidity. Factors and metrics that may be used to assess liquidity levels of senior loan holdings may include: (a) the frequency of trades and quotes for the particular holding, (b) the size of bid-offer spreads, (c) data freshness, (d) the size of the loan issue, (e) the credit rating of the issue, (f) the number of dealers willing to purchase or sell the holding and the number of potential purchasers, and (g) the mechanics of the transfer.
3. Stress testing and scenario analysis: We expect fund managers and portfolio managers to engage in stress testing of individual fund holdings, as well as senior loans as an asset class. Investment funds should consider and be prepared to meet higher than normal redemption demands, especially at a time when the senior loan market may be dislocated or stressed. As such, fund managers should always consider including in the mutual fund’s portfolio, assets that settle within three days or less, including cash, to minimize redemption settlement mismatches.
November 27, 2014 (2014), 37 OSCB 10340
Notices / News Releases
1.1.2 Ontario Securities Commission, Investment Funds and Structured Products Branch – IFRS Release No. 2
ONTARIO SECURITIES COMMISSION, INVESTMENT FUNDS AND STRUCTURED PRODUCTS BRANCH – IFRS RELEASE NO. 2
AUDITOR’S INVOLVEMENT WITH INTERIM FINANCIAL REPORTS
Further to IFRS Release No. 1 issued on September 30, 2014 by the Investment Funds and Structured Products Branch of the Ontario Securities Commission (OSC), staff continues to review the first IFRS interim financial reports for the period ended June 30, 2014. This communication is to alert investment fund issuers and their advisers in a timely manner to staff findings to date.
The requirement relating to an auditor’s involvement with interim financial reports is set out in section 2.12 of National Instrument 81-106 Investment Fund Continuous Disclosure (NI 81-106). This is a long-standing requirement that came into effect in 2005. While NI 81-106 does not require an investment fund that is a reporting issuer to engage an auditor to review its interim financial report, it does require a reporting issuer to disclose in an accompanying notice if an interim review has not been performed by its auditor. In the course of our IFRS reviews, we have found non-compliance with this disclosure requirement and, in such cases, have requested that investment fund issuers refile their interim financial reports with the required disclosure.
For those investment funds that have yet to file their first IFRS interim financial reports, we encourage the fund, its manager and advisers to review this release to inform their first IFRS filings.
Investor Impact
When an investment fund issuer has not engaged its auditor to perform a review, it is critical that the investment fund issuer clearly disclose this fact in a notice accompanying its interim financial report. The notice is important as it alerts investors and other users of the financial statements that the investment fund’s auditor did not complete a review of the interim financial report. With this disclosure, users of the financial statements are able to consider the degree of reliance they may wish to place on an investment fund’s interim financial report when deciding to buy or sell investments throughout the year.
When the first IFRS interim financial reports are not accompanied by a notice, it implies that an auditor review was conducted and such review encompassed the transition from pre-changeover Canadian GAAP to IFRS. The absence of a notice not only implies that a review was conducted, but that such review was able to be completed and the auditor did not express a reservation. This information, in staff’s view, is of particular importance at this time given that there has been a significant transition in accounting principles. In our view, the exclusion of a notice in the absence of a review is a material deficiency. We understand that there could also be a concern that some responsibility for the interim report incorrectly attaches to the auditor given the mistaken perception of auditor involvement.
Review Results
Where it appeared that the interim financial reports had been reviewed by the auditor, we asked investment funds to confirm that their interim financial reports had been reviewed in accordance with Section 7060 Auditor Review of Interim Financial Statements of the CPA Canada Handbook – Assurance (Section 7060 of the Handbook). Some investment funds confirmed that an auditor did not perform a review of their interim financial reports and yet these statements were not accompanied by a notice indicating that fact. The reasons cited for non-compliance by investment funds included: a general lack of awareness about their continuous disclosure obligations; confusion about what would constitute a review under securities legislation and Section 7060 of the Handbook; and, a misconception that clearly marking interim financial reports as “unaudited” would be sufficient to meet the requirements.
We remind financial statement preparers of section 3.4 of Companion Policy 81-106CP Investment Fund Continuous Disclosure which suggests that the notice normally should appear immediately before the interim financial report, in a manner similar to an auditor’s report that accompanies annual financial statements. Item B-1 of CSA Staff Notice 81-315 Frequently Asked Questions on NI 81-106 Investment Fund Continuous Disclosure, published in 2005, also points out that the requirement to disclose that an auditor has not reviewed the interim financial report is not fulfilled by marking the financial statements as “unaudited”.
Regulatory Consequences and Remedies
We believe that investors and other users of the financial statements need to be able to discern the level of auditor involvement in an investment fund’s interim financial report when making investment decisions. Accordingly, staff has requested investment fund issuers to refile their interim financial reports for the period ended June 30, 2014 with the required notice, and accompanied by a news release explaining the information being filed.
It is the responsibility of every investment fund issuer to meet its continuous disclosure reporting obligations. We remind investment fund managers that an investment fund that has filed financial statements or management reports of fund
November 27, 2014 (2014), 37 OSCB 10341
Notices / News Releases performance that do not comply with securities legislation or IFRS, could be placed on the list of defaulting reporting issuers maintained on the OSC website until the default is remedied. A content deficiency in any such documents could also lead to the reporting issuer being placed on the default list. For more information, please refer to OSC Policy 51-601 Reporting Issuer Defaults and OSC Staff Notice 51-711 List of Refilings and Corrections of Errors as a Result of Regulatory Reviews.
Conclusion
We will continue to monitor investment fund issuers’ compliance with the disclosure requirements relating to the auditor’s involvement with interim financial reports. Over the next year, this will form part of our financial examiner’s process of reviewing continuous disclosure filings. We urge investment fund issuers and their audit committees, if applicable, to consult with their auditors to confirm the scope of the auditor’s review engagement and determine whether a notice is required to be attached to the interim financial reports.
We will issue further releases with additional observations as our reviews continue, in order to assist investment fund issuers and their advisers with their IFRS filings.
Questions
Questions may be referred to the following staff members of the Investment Funds and Structured Products Branch:
Stacey Barker Ritu Kalra Sovener Yu Senior Accountant Senior Accountant Accountant 416-593-2391 416-593-8063 416-593-2395 [email protected] [email protected] [email protected]
November 26, 2014
November 27, 2014 (2014), 37 OSCB 10342
Notices / News Releases
1.4 Notices from the Office of the Secretary 1.4.2 Pro-Financial Asset Management Inc.
1.4.1 Bigfoot Recreation & Ski Area Ltd. and Ronald FOR IMMEDIATE RELEASE Stephen McHaffie November 21, 2014
FOR IMMEDIATE RELEASE IN THE MATTER OF November 20, 2014 THE SECURITIES ACT, R.S.O. 1990, c. S.5, AS AMENDED IN THE MATTER OF THE SECURITIES ACT, AND R.S.O. 1990, c. S.5, AS AMENDED IN THE MATTER OF AND PRO-FINANCIAL ASSET MANAGEMENT INC.
IN THE MATTER OF TORONTO – The Commission issued an Order in the BIGFOOT RECREATION & SKI AREA LTD. above named matter which provides that: and RONALD STEPHEN MCHAFFIE 1. The hearing is adjourned to January 14, TORONTO – The Commission issued an Order in the 2015 at 9:00 a.m. above named matter which provides that: 2. The Temporary Order as amended by (1) Staff’s application to proceed by way of previous Commission orders is extended written hearing is granted; to January 16, 2015.
(2) Staff’s materials in respect of the written A copy of the Order dated November 20, 2014 is available hearing shall be served and filed no later at www.osc.gov.on.ca. than 10 days following the issuance of this order; OFFICE OF THE SECRETARY JOSÉE TURCOTTE (3) the Respondents’ responding materials, if SECRETARY any, shall be served and filed no later than 4 weeks from the effective date of For media inquiries: service of Staff’s materials; and [email protected] (4) Staff’s reply materials, if any, shall be served and filed no later than 2 weeks For investor inquiries: from effective date of service of the Respondents’ materials. OSC Contact Centre 416-593-8314 A copy of the Order dated November 19, 2014 is available 1-877-785-1555 (Toll Free) at www.osc.gov.on.ca.
OFFICE OF THE SECRETARY JOSÉE TURCOTTE SECRETARY
For media inquiries: [email protected]
For investor inquiries:
OSC Contact Centre 416-593-8314 1-877-785-1555 (Toll Free)
November 27, 2014 (2014), 37 OSCB 10343
Notices / News Releases
1.4.3 TG Residential Value Properties Ltd.
FOR IMMEDIATE RELEASE November 24, 2014
IN THE MATTER OF THE SECURITIES ACT, R.S.O. 1990, c. S.5, AS AMENDED
AND
IN THE MATTER OF TG RESIDENTIAL VALUE PROPERTIES LTD.
TORONTO – The Commission issued an Order in the above named matter which provides that, pursuant to subsection 127(7) the TCTO be extended until December 4, 2014; and the hearing in this matter be adjourned until December 1, 2014, at 10:00 a.m.
A copy of the Order dated November 21, 2014 is available at www.osc.gov.on.ca.
OFFICE OF THE SECRETARY JOSÉE TURCOTTE SECRETARY
For media inquiries: [email protected]
For investor inquiries: OSC Contact Centre 416-593-8314 1-877-785-1555 (Toll Free)
November 27, 2014 (2014), 37 OSCB 10344
Chapter 2
Decisions, Orders and Rulings
2.1 Decisions
2.1.1 Next Edge Capital Corp. et al.
Headnote
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions – relief granted from the investment fund self-dealing restrictions in the Securities Act (Ontario) to allow a pooled fund to invest in securities of an underlying fund under common management – relief subject to certain conditions.
Applicable Legislative Provisions
Securities Act (Ontario), R.S.O. 1990, c. S.5, as am., ss. 111(2)(b), 111(3) and (4), 113, 117(1)(a), 117(2).
November 7, 2014
IN THE MATTER OF THE SECURITIES LEGISLATION OF ONTARIO (the “Jurisdiction”)
AND
IN THE MATTER OF THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS IN MULTIPLE JURISDICTIONS
AND
IN THE MATTER OF NEXT EDGE CAPITAL CORP. (the “Filer”)
AND
IN THE MATTER OF NEXT EDGE PRIVATE DEBT FUND, NEXT EDGE COMMERCIAL TRUST and NEXT EDGE PRIVATE DEBT LP
DECISION
Background
The principal regulator in the Jurisdiction has received an application from Next Edge Capital Corp. (the Manager), on behalf of each of Next Edge Private Debt Fund (the Fund) and Next Edge Commercial Trust (the Sub Trust) (together, the Top Funds) and the Next Edge Private Debt Fund LP (the Partnership), for a decision under the securities legislation of Ontario (the Legislation) pursuant to:
a) section 113 of the Securities Act (Ontario) (Act) for relief from the following provisions:
i. paragraph 111(2)(b) of the Act, which prohibits an investment fund from knowingly making an investment in any person or company in which the investment fund, alone or together with one or more related investment funds, is a substantial security holder;
ii. subsection 111(3) of the Act, which prohibits a mutual fund in Ontario or its management company or its distribution company against knowingly holding an investment described in (i) above;
November 27, 2014 (2014), 37 OSCB 10345
Decisions, Orders and Rulings
iii. subsection 111(4) of the Act, which prohibits an investment fund from knowingly holding an investment described in (i) above made on or after July 24, 2014; and
b) subsection 117(2) of the Act for relief from the requirement under paragraph 117(1)1 of the Act to file a report of every transaction of purchase or sale of securities between a mutual fund and any related person or company (collectively, the Requested Relief).
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission is the principal regulator for this application; and
(b) the Filer has provided notice that section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in British Columbia, Alberta, Saskatchewan, Manitoba, Quebec, Nova Scotia, New Brunswick, Newfoundland and Labrador, Prince Edward Island, Yukon, Northwest Territories and Nunavut.
Interpretation
Terms defined in National Instrument 14-101 Definitions and MI 11-102 have the same meaning if used in this decision, unless otherwise defined.
Representations
This decision is based on the following facts represented by the Filer:
The Filer
1. The Filer is a corporation formed under the laws of Ontario. The principal place of business of the Manager is 1 Toronto Street, Suite 200, Toronto, Ontario M5C 2V6.
2. The Filer is registered as an Investment Fund Manager in Ontario, Québec and Newfoundland and Labrador, as an adviser in the category of Portfolio Manager in Ontario and Alberta and as a dealer in the category of Exempt Market Dealer in Ontario, British Columbia, Alberta, Saskatchewan, Manitoba, Québec, New Brunswick and Nova Scotia.
3. The Filer is not a reporting issuer in any jurisdiction of Canada and is not in default of securities legislation of any jurisdiction of Canada.
The Fund
4. Next Edge Private Debt Fund is to be established as an open ended investment fund which will be formed and organized under the laws of the Province of Ontario pursuant to a trust agreement (the Trust Agreement). The Fund’s head office is located in Toronto, Ontario.
5. The Filer will be the trustee of the Fund and will continue in that capacity until it resigns or is replaced by the Fund in accordance with the Trust Agreement.
6. The investment objective of the Fund is to achieve consistent risk-adjusted returns with minimal volatility and low correlation to most traditional asset classes.
7. The Fund intends to achieve its investment objective by investing substantially all of its net assets in the Sub Trust, which will invest substantially all of its assets in the Partnership.
8. Pursuant to a management agreement to be entered into between the Fund and the Filer, the Filer will be the manager and investment adviser of the Fund.
9. An investment in the Fund is to be represented by an unlimited number of authorized trust units (the Units). Units of the Fund are to be offered in each of the provinces and territories in Canada by prospectus exemption in accordance with National Instrument 45-106 Prospectus and Registration Exemptions (NI 45-106).
10. The Fund will not be a reporting issuer under the Act and is not in default of securities legislation of any jurisdiction of Canada.
November 27, 2014 (2014), 37 OSCB 10346
Decisions, Orders and Rulings
The Sub Trust
11. The Sub Trust is an unincorporated open-ended limited purpose trust to be established under the laws of the Province of Ontario pursuant to a trust indenture (the Sub Trust Indenture).
12. The Filer will be the trustee of the Sub Trust and will continue in that capacity until it resigns or is replaced by the Sub Trust in accordance with the Sub Trust Indenture.
13. The Sub Trust’s sole function will be to own units of the Partnership following the closing of the offering of units of the Fund.
14. Pursuant to a management agreement to be entered into between the Sub Trust and the Filer, the Filer will be the manager and investment adviser of the Sub Trust.
15. The Fund will be the sole securityholder of the Sub Trust.
16. The Sub Trust will not be a reporting issuer under the Act and is not in default of securities legislation of any jurisdiction of Canada.
The Partnership and General Partner
17. The Partnership was established under the laws of Ontario pursuant to a Declaration of Limited Partnership dated September 16, 2014 under the Limited Partnerships Act (Ontario). Next Edge General Partner (Ontario) Inc. (the General Partner) was incorporated under the Business Corporations Act (Ontario) on September 15, 2014.
18. The Partnership will be governed by a limited partnership agreement (the Limited Partnership Agreement) made between the General Partner and the Sub Trust. The principal place of business of the Partnership and the General Partner is 1 Toronto Street, Suite 200, Toronto, Ontario, Canada M5C 2V6.
19. The investment objective of the Partnership is to achieve consistent risk-adjusted returns with minimal volatility and low correlation to most traditional asset classes by investing primarily in a portfolio of private debt securities.
20. The Partnership intends to achieve its investment objective by allocating capital to a number of specialist loan originators and managers of credit pools (Credit Managers) to take advantage of opportunities in the private debt markets.
21. The Partnership will invest in both senior and subordinated debt, subject to the advice and recommendations of seasoned Credit Managers, with the intent of building a portfolio (the Portfolio), either directly or indirectly, of private income generating securities.
22. Initially, the Portfolio is expected to consist primarily of short term receivables. It will also be investing in, but will not be limited to, first and second lien senior loans and term mezzanine debt and bridge loans. The securities initially comprising the Portfolio will be over-collateralized and have an average term to maturity of 50-60 days. The investment strategies of the Partnership, however, provide the Partnership with the flexibility to invest other investment funds, exchange-traded funds and mutual funds and, to a lesser extent, derivatives such as forward currency agreement and options, may also be used on an opportunistic basis in order to meet the Partnership’s investment objectives. The General Partner may, on 30 days’ prior written notice, change the investment strategies of the Partnership to adapt to changing circumstances.
23. The General Partner is generally responsible for management and control of the business and affairs of the Partnership in accordance with the terms of the Limited Partnership Agreement. Pursuant to a management agreement, the General Partner has engaged the Filer to carry out its duties, including management of the Partnership on a day-to-day basis, management of the Portfolio and distribution of the units of the Partnership, but remains responsible for supervising the Filer’s activities on behalf of the Partnership.
24. The General Partner’s investment in the Partnership will be nominal.
25. The Sub Trust will be the sole Limited Partner of the Partnership.
26. The Partnership is not a reporting issuer under the Act and is not in default of securities legislation of any jurisdiction of Canada.
November 27, 2014 (2014), 37 OSCB 10347
Decisions, Orders and Rulings
Fund-on-Fund Structure
27. The Fund allows investors to obtain exposure to the investment portfolio of the Partnership and its investment strategies through direct investment by the Fund in securities of the Sub Trust and direct investment by the Sub Trust in the securities of the Partnership (the Fund-on-Fund Structure).
28. For the units of the Fund to be offered to deferred income plans, it is necessary that the Fund qualify as a “mutual fund trust” under the Income Tax Act (Canada). In order to qualify as a “mutual fund trust”, amongst other conditions, the sole undertaking of the Fund must be investing of its funds in property. The Partnership, amongst its activities, intends to acquire interests in factoring participation agreements. While those investments will be passive, the nature of the participation is such that it may be argued from a tax perspective to constitute an undertaking by the Fund (assuming it participated directly) other than merely investing its funds in property which may be viewed as putting the Fund offside the definition of “mutual fund trust” for the purposes of the Income Tax Act (Canada).
29. The interposition of the Sub Trust between the Fund and the Partnership further strengthens this position, since in some cases a partner of a limited partnership may be considered to itself be carrying on the activities of the Partnership.
30. An investment in the Sub Trust by the Fund will be compatible with the investment objectives of the Fund, and an investment in the Partnership by the Sub Trust will be compatible with the investment objectives of the Sub Trust.
31. The amount invested in the Partnership by the Sub-Trust, both managed by the Filer, will exceed 20% of the outstanding voting securities of the Partnership. Accordingly, the Sub-Trust will be a substantial securityholder of the Partnership.
32. The amount invested in the Sub-Trust by the Fund, both managed by the Filer, will exceed 20% of the outstanding voting securities of the Sub-Trust. Accordingly, the Fund will be a substantial securityholder of the Sub-Trust.
33. The Top Funds and the Partnership are related funds by virtue of the common management of these funds by the Filer.
34. The Filer is entitled to receive a management fee, payable in consideration of the services provided to the Fund and the Partnership. The Filer will ensure that the arrangements between the Fund, the Sub Trust and the Partnership in respect of an investment in the Fund-on-Fund Structure will avoid the duplication of management fees and incentive fees. Other than the management fee payable by the Fund to the Filer, which will be utilized to pay the servicing commissions, the Filer and its affiliates do not charge, and will not charge, any management fee or incentive fee to the Fund or the Sub Trust.
35. There will be no sales fees or redemption fees payable by the Top Funds in respect of an acquisition, disposition or redemption of securities of the Partnership.
36. Prior to the time of purchase of Units of the Fund, an investor will be provided with an offering memorandum of the Fund which contains disclosure about the relationships, aggregate fee disclosure and potential conflicts of interest between the Top Funds and the Partnership.
37. The offering memorandum will describe the Fund’s intent, or ability, to invest in securities of the Sub Trust and the Sub Trust’s intent, or ability, to invest in securities of the Partnership. The offering memorandum will also disclose that the Sub Trust and the Partnership are managed by the Filer.
38. Each of the Top Funds and the Partnership will prepare annual audited financial statements and interim financial reports in accordance with National Instrument 81-106 Investment Funds Continuous Disclosure (NI 81-106) and will otherwise comply with the applicable requirements of NI 81-106.
39. Unitholders of the Fund will receive, on request, a copy of the Fund’s audited annual financial statements and interim financial reports. The financial statements of the Fund will disclose its holdings of units in the Sub Trust.
40. Unitholders of the Fund will receive, on request, a copy of the audited annual financial statements and interim financial reports of the Sub Trust and the Partnership. The financial statements of the Sub Trust will disclose its holdings of securities of the Partnership.
41. Each of the Fund, the Sub Trust and the Partnership has matching valuation dates and are valued on a monthly basis.
42. Units of the Fund can be redeemed on any valuation date.
November 27, 2014 (2014), 37 OSCB 10348
Decisions, Orders and Rulings
43. The Filer manages or will manage the portfolio of the Partnership to ensure there is sufficient liquidity to provide for redemptions of units by unitholders of the Fund.
44. Each of the Fund and the Sub trust is a “clone fund” as defined in National Instrument 81-102 Investment Funds (NI 81- 102).
Generally
45. Since neither the Fund nor the Sub Trust is a reporting issuer, they are not subject to NI 81-102 and, therefore, the Top Funds are unable to rely upon the exemption codified in subsection 2.5(7) of NI 81-102.
46. In the absence of the Requested Relief, the Fund would be precluded from investing in the Sub Trust, and the Sub Trust would be precluded from investing in the Partnership, due to the investment prohibitions in paragraph 111(2)(b) and subsections 111(3) and 111(4) of the Act.
47. In the absence of the Requested Relief, the Filer would be required to file a report for every transaction between the Top Fund and the Partnership under paragraph 117(1)(a) of the Act.
48. The Fund’s investments in the Partnership through the Sub Trust represent the business judgment of responsible persons uninfluenced by considerations other than the best interests of the investment funds concerned.
Decision
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator under the Legislation is that the Requested Relief is granted, provided that the Filer ensures that:
(a) securities of the Fund are distributed in Canada solely pursuant to exemptions from the prospectus requirements in NI 45-106;
(b) the investment by the Fund in the Sub Trust and the investment by the Sub Trust in the Partnership is compatible with the fundamental objectives of the Fund and the Sub Trust, respectively;
(c) the Sub Trust will not purchase or hold securities of the Partnership unless, at the time of the purchase of securities of the Partnership, the Partnership holds no more than 10% of its net assets in securities of other investment funds other than securities
(i) of a “money market fund” (as defined in NI 81-102), or
(ii) that are “index participation units” (as defined in NI 81-102) issued by an investment fund;
(d) no management fees or incentive fees are payable by the Fund that, to a reasonable person, would duplicate a fee payable by the Sub Trust or the Partnership for the same service;
(e) no management fees or incentive fees are payable by the Sub Trust that, to a reasonable person, would duplicate a fee payable by the Partnership for the same service;
(f) no sales fees or redemption fees are payable by (i) the Fund in relation to its purchases or redemptions of securities of the Sub Trust, or (ii) the Sub Trust in relation to its purchases or redemptions of securities of the Partnership;
(g) the Filer will provide to investors in the Fund an offering memorandum (or other similar document), which discloses:
(i) that the Fund will purchase units of the Sub Trust and the Sub Trust will purchase units of the Partnership;
(ii) the fact that the Sub Trust and the Partnership are also managed and advised by the Filer;
(iii) the fact that substantially all of the assets of the Fund are invested in securities of the Sub Trust and that substantially all of the assets of the Sub Trust are invested in securities of the Partnership; and
November 27, 2014 (2014), 37 OSCB 10349
Decisions, Orders and Rulings
(iv) the process or criteria used to select the Partnership’s investments;
(h) investors in the Fund will be informed that they are entitled to receive from the Filer, on request and free of charge, the annual financial statements and interim financial reports of the Fund, the Sub Trust and the Partnership;
(i) the Filer does not cause the units of the Sub Trust held by the Fund to be voted at any meeting of holders of such units, except that the Filer may arrange for the units the Fund holds of the Sub Trust to be voted by the beneficial holders of units of the Fund;
(j) the Filer does not cause the units of the Partnership held by the Sub Trust to be voted at any meeting of holders of such units, except that the Filer may arrange for the units the Sub Trust holds of the Partnership to be voted by the beneficial holders of units of the Fund;
(k) the Fund is the only securityholder of the Sub Trust and the Sub Trust is the only limited partner of the Partnership;
(l) the General Partner’s investment in the Partnership is nominal; and
(m) each of the Fund and the Sub Trust is a “clone fund” as defined in NI 81-102.
“Edward P. Kerwin” Commissioner Ontario Securities Commission
“Anne Marie Ryan” Commissioner Ontario Securities Commission
November 27, 2014 (2014), 37 OSCB 10350
Decisions, Orders and Rulings
2.1.2 Franklin Templeton Investments Corp. et al.
Headnote
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions – Approval of mutual fund mergers – approval required because merger does not meet the criteria for pre-approved reorganizations and transfers in National Instrument 81-102 – the mergers will not be “qualifying exchanges” or tax-deferred transactions under the Income Tax Act (Canada) – securityholders of terminating funds provided with timely and adequate disclosure regarding the mergers.
Applicable Legislative Provisions
National Instrument 81-102 Investment Funds, s. 5.5(1)(b).
November 5, 2014
IN THE MATTER OF THE SECURITIES LEGISLATION OF ONTARIO (the Jurisdiction)
AND
IN THE MATTER OF THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS IN MULTIPLE JURISDICTIONS
AND
IN THE MATTER OF FRANKLIN TEMPLETON INVESTMENTS CORP. (the Filer)
AND
FRANKLIN BISSETT BOND YIELD CLASS, FRANKLIN BISSETT BOND CORPORATE CLASS, FRANKLIN BISSETT CANADIAN SHORT TERM BOND YIELD CLASS, FRANKLIN BISSETT CORPORATE BOND YIELD CLASS, TEMPLETON GLOBAL BOND HEDGED YIELD CLASS (each, a Terminating Fund and collectively, the Terminating Funds)
DECISION
Background
The principal regulator in the Jurisdiction has received an application from the Filer on behalf of the Terminating Funds for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) approving the mergers (the Mergers) of the Terminating Funds into the Continuing Funds (defined below) pursuant to paragraph 5.5(1)(b) of National Instrument 81-102 Investment Funds (NI 81-102) (the Approval Sought).
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission is the principal regulator for this application; and
(b) the Filer has provided notice that subsection 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11- 102) is intended to be relied upon in each of British Columbia, Alberta, Saskatchewan, Manitoba, Quebec, New Brunswick, Nova Scotia, Prince Edward Island, Newfoundland and Labrador, Yukon, Northwest Territories and Nunavut (collectively, the Passport Jurisdictions).
Interpretation
Terms defined in National Instrument 14-101 Definitions and MI 11-102 have the same meaning if used in this decision, unless otherwise defined. The following additional terms shall have the following meanings:
November 27, 2014 (2014), 37 OSCB 10351
Decisions, Orders and Rulings
Bond Fund Merger means the merger of Franklin Bissett Bond Corporate Class into Franklin Bissett Bond Fund;
Continuing Funds means Franklin Bissett Bond Fund, Franklin Bissett Canadian Short Term Bond Fund, Franklin Bissett Corporate Bond Fund and Templeton Global Bond Fund;
FTCCL means Franklin Templeton Corporate Class Ltd;
Funds means collectively, the Terminating Funds and the Continuing Funds, and Fund means any one of the Terminating Funds or the Continuing Funds;
IRC means the independent review committee for the Funds;
Tax Act means the Income Tax Act (Canada);
Yield Class means each of Templeton Global Bond Hedged Yield Class, Franklin Bissett Bond Yield Class, Franklin Bissett Canadian Short Term Bond Yield Class and Franklin Bissett Corporate Bond Yield Class; and
Yield Class Mergers means, collectively, the merger of (i) Templeton Global Bond Hedged Yield Class into Templeton Global Bond Fund; (ii) Franklin Bissett Bond Yield Class into Franklin Bissett Bond Fund; (iii) Franklin Bissett Canadian Short Term Bond Yield Class into Franklin Bissett Canadian Short Term Bond Fund; and (iv) Franklin Bissett Corporate Bond Yield Class into Franklin Bissett Corporate Bond Fund.
Representations
This decision is based on the following facts represented by the Filer:
The Filer
1. The Filer is a corporation existing under the laws of Ontario having its registered head office in Toronto, Ontario.
2. The Filer is registered as an investment fund manager, portfolio manager, exempt market dealer and mutual fund dealer in the Jurisdiction and is registered as a portfolio manager, exempt market dealer and mutual fund dealer in each of Alberta, British Columbia, Manitoba, New Brunswick, Newfoundland and Labrador, Nova Scotia, Prince Edward Island, Quebec, Saskatchewan and Yukon and as an investment fund manager in each of Alberta, British Columbia, Manitoba, Newfoundland and Labrador, Nova Scotia and Quebec.
3. The Filer is the investment fund manager of each of the Funds.
The Funds
4. FTCCL is an open-end mutual fund corporation incorporated under the laws of Alberta on June 1, 2001. Each of the Terminating Funds is a separate class of special shares of FTCCL.
5. Each of the Continuing Funds is a trust established under the laws of Ontario.
6. Securities of the Funds are currently qualified for sale by a simplified prospectus, annual information form and Fund Facts dated May 29, 2014, which have been filed and receipted in Ontario and each of the Passport Jurisdictions (collectively, the Jurisdictions).
7. Each of the Funds is a reporting issuer in the Jurisdictions.
8. Neither the Filer nor any Fund is in default under the securities legislation in the Jurisdictions.
9. Other than circumstances in which the securities regulatory authorities of the Jurisdictions has expressly exempted a Fund therefrom, each of the Funds follows the standard investment restrictions and practices established under NI 81- 102.
Rationale for Mergers
10. The Terminating Funds, other than Franklin Bissett Bond Corporate Class, currently provide tax-efficient fixed income offerings by investing in different types of securities and entering into forward contracts to provide investment returns similar to those generated by certain reference funds that invest in fixed income securities (Reference Funds).
November 27, 2014 (2014), 37 OSCB 10352
Decisions, Orders and Rulings
11. The favourable tax treatment of the above arrangements will be eliminated by new rules in the Tax Act, announced on March 21, 2013, that affect the tax treatment of returns earned under “derivative forward agreements”.
12. As a result of this change in the Tax Act, the Filer has determined that it will no longer be possible to provide securityholders of the Terminating Funds with their desired exposure to their Reference Funds on a tax-advantaged basis and so the Filer proposes to effect the Mergers.
Approval of the Proposed Mergers
13. The Mergers will not constitute a material change for the Continuing Funds.
14. Securityholders of the Terminating Funds will be asked to approve the relevant Mergers at special meetings expected to be held on or about November 28, 2014.
15. The Filer, as the sole Class A common shareholder of FTCCL will approve the Mergers, as required under the Business Corporations Act (Alberta).
16. Subject to receipt of securityholder approval and the Approval Sought, the Mergers are expected to occur on or about December 12, 2014 (the Effective Date).
17. If securityholder approval is not received at the special meeting in respect of a Fund, then the relevant Merger will not proceed and the relevant Terminating Fund will be terminated on or about January 9, 2015.
Merger Steps
18. It is proposed that the following steps will be carried out to effect the Mergers:
(a) In respect of the proposed Bond Fund Merger:
(i) As the Terminating Fund’s investment portfolio currently consists of units of its Continuing Fund, on the Effective Date, the Terminating Fund will redeem its outstanding shares and distribute the units of the Continuing Fund owned by the Terminating Fund to shareholders of the Terminating Fund, in exchange for all such shareholders’ existing shares of the Terminating Fund, on a series-for-series and dollar-for-dollar basis; and
(ii) As soon as reasonably possible following the Merger, the articles of FTCCL will be amended to authorize the cancellation of the issued and unissued special shares of the Terminating Fund.
(b) In respect of the Yield Class Mergers:
(i) Each Terminating Fund’s investment portfolio currently consists of a common share portfolio and forward contracts and may also include fixed income securities. Prior to the Effective Date, any fixed income securities held by a Terminating Fund will be liquidated for cash;
(ii) On or about December 2, 2014 (the Settlement Date), each Terminating Fund will settle the forward contract with its applicable counterparty (the Counterparty). The Counterparty will pay the settlement amount by redeeming its investment in the applicable Continuing Fund and directing the Continuing Fund to pay the redemption proceeds to the Terminating Fund. Each Terminating Fund will subscribe for units of its applicable Continuing Fund in an amount equal to the value of its assets less an amount required to satisfy the liabilities of the Terminating Fund and in payment thereof, the Terminating Fund will direct the Continuing Fund to use the amount owing to it from the Counterparty. The Terminating Fund will then deliver its common share portfolio to the Counterparty;
(iii) On the Effective Date, each Terminating Fund will use any remaining cash in its portfolio to subscribe for additional units of its applicable Continuing Fund and then each Terminating Fund will redeem its outstanding shares and distribute the units of the Continuing Fund held by the Terminating Fund to shareholders of the Terminating Fund, in exchange for all such shareholders’ existing shares of the Terminating Fund, on a series-for-series and dollar-for-dollar basis, except for:
(1) Series R, S and T shares of Templeton Global Bond Hedged Yield Class, which will be exchanged for Series O, F and A units, respectively of Templeton Global Bond Fund, and
November 27, 2014 (2014), 37 OSCB 10353
Decisions, Orders and Rulings
(2) Series T shares of Franklin Bissett Corporate Bond Yield Class, which will be exchanged for Series A units of Franklin Bissett Corporate Bond Fund; and
(iv) As soon as reasonably possible following the Mergers, the articles of FTCCL will be amended to authorize the cancellation of the issued and unissued special shares of each Terminating Fund.
19. As soon as reasonably possible following the Mergers, the Terminating Funds will be wound up and the Continuing Funds will continue as publically offered open-end mutual funds.
20. Costs and expenses associated with the Mergers, including the costs of the Meetings, will be borne by the Manager and will not be charged to the Funds. The costs of the Mergers include legal, printing, mailing and regulatory fees, as well as proxy solicitation costs.
Comparison of Terminating Funds and Continuing Funds
21. The Mergers satisfy all of the requirements for pre-approved reorganizations and transfers set out in section 5.6(1) of NI 81-102, except the requirement set out in subsection 5.6(1)(b) that the Mergers be “qualifying exchanges” within the meaning of section 132.2 of the Tax Act or tax-deferred transactions under subsections 85(1), 85.1(1), 86(1) or 87(1) of the Tax Act.
22. No sales charges will be payable by securityholders of the Funds in connection with the Mergers.
Securityholder Disclosure
23. A press release describing the proposed Mergers has been issued and the press release, material change report and amendments to the simplified prospectus, annual information form and Fund Facts, which give notice of the proposed Mergers, have been filed via SEDAR.
24. A notice of meeting, management information circular, proxy and Fund Facts of the applicable series of each Continuing Fund (the Meeting Materials) will be mailed to securityholders of each Terminating Fund commencing on or about November 4, 2014 and will be filed via SEDAR.
25. The Meeting Materials will contain a description of the proposed Mergers, information about the Terminating Funds and the Continuing Funds and income tax considerations for securityholders of the Terminating Funds. The Meeting Materials will also describe the various ways in which investors can obtain a copy of the simplified prospectus and annual information form of the Continuing Funds, as well as the most recent interim and annual financial statements and management reports of fund performance for the Continuing Funds.
Securityholder Purchases and Redemptions
26. Securityholders of each Terminating Fund will continue to have the right to redeem securities of the Terminating Fund for cash or switch into securities of another Franklin Templeton mutual fund (including on a tax-deferred basis to a fund that is a class of FTCCL) at any time up to the close of business on the business day immediately before the Effective Date of the applicable Merger.
27. The Terminating Funds are currently closed to investment, except Franklin Bissett Bond Corporate Class, which permits certain pre-authorized purchase plans only. The Terminating Funds will remain closed to all purchase-type transactions until they are merged with the Continuing Funds on the Effective Date, except for Franklin Bissett Bond Corporate Class which will continue to permit certain pre-authorized purchase plans until December 11, 2014. Systematic withdrawal programs shall remain unaffected until the business day immediately before the Effective Date of the applicable Merger.
28. Following the Mergers, all systematic programs that had been established with respect to the Terminating Funds will be re-established on a series-for-series basis in the applicable Continuing Funds (subject to the exceptions noted in paragraph 18(b)(iii) above), unless securityholders advise the Filer otherwise.
29. Securityholders may change or cancel any systematic program at any time and securityholders of the Terminating Funds who wish to establish one or more systematic programs in respect of their holdings in the Continuing Funds may do so following the Mergers.
November 27, 2014 (2014), 37 OSCB 10354
Decisions, Orders and Rulings
IRC Review
30. The Filer has presented the proposed Mergers to the IRC and has obtained a positive recommendation that each Merger, if implemented, would achieve a fair and reasonable result for the Funds.
31. A summary of the IRC’s recommendation will be included in the notice of special meeting sent to securityholders of the Terminating Funds as required by subsection 5.1(2) of National Instrument 81-107 Independent Review Committee for Investment Funds.
Benefits of Mergers
32. The Filer believes that the Mergers will benefit securityholders of the Terminating Funds in the following ways:
(a) the proposed Mergers will facilitate an improved after-tax outcome for securityholders, especially after consideration of the other options of: (i) leaving securityholders in the soon to be ineffective Terminating Funds; or (ii) simply winding down the Terminating Funds;
(b) once the transitional arrangements for derivative forward agreements under the Tax Act cease to apply, there is no reasonably foreseeable reason why a securityholder would be better off in a Terminating Fund relative to its Continuing Fund, as securityholders will receive a fund with substantially similar investment objectives;
(c) management and administration fees will not increase and management expense ratios (MER) of each Continuing Fund will remain substantially the same as or, in some cases, be moderately lower than, the MER of its corresponding Terminating Fund; and
(d) the risk profile of each Continuing Fund is the same as that of its corresponding Terminating Fund, except for each Yield Class where, in addition, the risk and cost associated with the forward contracts is not borne by the Continuing Fund.
Reason for Approval Sought
33. Regulatory approval of the Mergers is required because the Mergers do not satisfy one of the criteria for pre-approved reorganizations and transfers set out in section 5.6 of NI 81-102 in that the Mergers will not be implemented as “qualifying exchanges” within the meaning of section 132.2 of the Tax Act or as tax-deferred transactions under subsections 85(1), 85.1(1), 86(1) or 87(1) of the Tax Act.
Decision
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator under the Legislation is that the Approval Sought is granted, provided that the Filer obtains the prior approval of the securityholders of the Terminating Funds for the Mergers at the special meetings held for that purpose, or any adjournments thereof.
“Raymond Chan” Manager, Investment Funds and Structured Products Ontario Securities Commission
November 27, 2014 (2014), 37 OSCB 10355
Decisions, Orders and Rulings
2.1.3 Nexans S.A.
Headnote
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions – Dual application for Exemptive Relief Applications – Application for relief from the prospectus and registration requirements for certain trades made in connection with an employee share offering by a French issuer – The issuer cannot rely on the employee exemption in section 2.24 of Regulation 45-106 respecting prospectus and registration exemptions as the securities are not being offered to Canadian employees directly by the issuer but rather through special purpose entities – Canadian participants will receive disclosure documents – The special purpose entities are subject to the supervision of the local securities regulator – Canadian employees will not be induced to participate in the offering by expectation of employment or continued employment – There is no market for the securities of the issuer in Canada – The number of Canadian participants and their share ownership are de minimis – Relief granted, subject to conditions.
Applicable Legislative Provisions
Securities Act, R.S.O. 1990, c. S.5, as am., ss. 25(1), 53(1), 74. Regulation 45-106 respecting prospectus and registration exemptions, s. 2.24.
October 27, 2014
TRANSLATION
IN THE MATTER OF THE SECURITIES LEGISLATION OF QUÉBEC AND ONTARIO (the “Filing Jurisdictions”)
AND
IN THE MATTER OF THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS IN MULTIPLE JURISDICTIONS
AND
IN THE MATTER OF NEXANS S.A. (the “Filer”)
DECISION
Background
The securities regulatory authority or regulator in each of the Filing Jurisdictions (the “Decision Maker”) has received an application from the Filer for a decision under the securities legislation of the Filing Jurisdictions (the “Legislation”) for:
1. an exemption from the prospectus requirements of the Legislation (the “Prospectus Relief”) so that such requirements do not apply to
(a) Trades in units (the “Units”) of Nexans Plus 2014 B (the “Compartment”), a compartment of an FCPE named Nexans Plus 2014 (the “Fund”), which is a fonds commun de placement d’entreprise or “FCPE” (a form of collective shareholding vehicle of a type commonly used in France for the conservation or custodianship of shares held by employee-investors) made pursuant to the Employee Share Offering (as defined below) to or with Qualifying Employees (as defined below) of Canadian Affiliates (as defined below) resident in the Filing Jurisdictions and in Alberta, Saskatchewan, Manitoba and Nova Scotia (collectively, the “Canadian Employees”) who elect to participate in the Employee Share Offering (such Canadian Employees who subscribe for Units, the “Canadian Participants”);
(b) trades in ordinary shares of the Filer (the “Shares”) by the Compartment and another FCPE named Actionnariat Nexans (the “Transfer Fund”) to or with Canadian Participants upon the redemption of Units and Transfer Fund Units (as defined below), respectively, as requested by Canadian Participants;
November 27, 2014 (2014), 37 OSCB 10356
Decisions, Orders and Rulings
(c) trades in Transfer Fund Units made pursuant to the Employee Share Offering to or with Canadian Participants, including upon a transfer of the Canadian Participants’ assets in the Compartment to the Transfer Fund at the end of the Lock-Up Period (as defined below);
2. an exemption from the dealer registration requirements of the Legislation (the “Registration Relief”) so that such requirements do not apply to the Nexans Group (as defined below), the Compartment, the Transfer Fund and the Fund, as applicable, and BNP Asset Management (the “Management Company”) in respect of the following:
(a) trades in Units made pursuant to the Employee Share Offering to or with Canadian Participants not resident in Ontario and Manitoba;
(b) trades in Shares by the Compartment and the Transfer Fund to or with Canadian Participants upon the redemption of Units and Transfer Fund Units, respectively, as requested by Canadian Participants; and
(c) trades in Transfer Fund Units made pursuant to the Employee Share Offering to or with Canadian Participants, including upon a transfer of the Canadian Participants’ assets in the Compartment to the Transfer Fund at the end of the Lock-Up Period;
the Prospectus Relief and the Registration Relief, collectively, the “Offering Relief”).
3. Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a dual application):
(a) the Autorité des marchés financiers is the principal regulator for this application;
(b) the Filer has provided notice that section 4.7(1) of Regulation 11-102 respecting Passport System (“Regulation 11-102”) is intended to be relied upon in Alberta, Saskatchewan, Manitoba and Nova Scotia (collectively the “Other Jurisdictions” and, together with the Filing Jurisdictions, the “Jurisdictions”); and
(c) the decision is the decision of the principal regulator and evidences the decision of the securities regulatory authority or regulator in Ontario.
Interpretation
Terms defined in Regulation 14-101 respecting Definitions, Regulation 45-102 respecting resale of securities, Regulation 45-106 respecting Prospectus and Registration Exemptions and Regulation 11-102 have the same meaning if used in this decision, unless otherwise defined.
Representations
This decision is based on the following facts represented by the Filer:
1. The Filer is a corporation formed under the laws of France. It is not, and has no current intention of becoming, a reporting issuer under the Legislation or the securities legislation of the Other Jurisdictions. The head office of the Filer is located in France. The Shares are listed on NYSE Euronext Paris. The Filer is not in default of the Legislation or the securities legislation of the Other Jurisdictions.
2. Certain affiliates of the Filer, including Nexans Canada Inc. and AmerCable Incorporated (collectively, the “Canadian Affiliates” and, together with the Filer and other affiliates of the Filer, the “Nexans Group”), employ Canadian Employees.
3. Each of the Canadian Affiliates is a direct or indirect controlled subsidiary of the Filer and is not, and has no current intention of becoming, a reporting issuer under the Legislation or the securities legislation of the Other Jurisdictions. The Canadian Affiliates are not in default of the Legislation or the securities legislation of the Other Jurisdictions.
4. As of the date hereof and after giving effect to the Employee Share Offering, Canadian residents do not and will not beneficially own (which term, for the purposes of this paragraph, is deemed to include all Shares held by the Compartment and the Transfer Fund on behalf of Canadian Participants) more than 10% of the Shares issued and outstanding and do not and will not represent in number more than 10% of the total number of holders of Shares as shown on the books of the Filer.
5. The Filer has established a global employee share offering for employees of the Nexans Group (the “Employee Share Offering”). The Employee Share Offering involves an offering of Shares to be subscribed through the Compartment.
November 27, 2014 (2014), 37 OSCB 10357
Decisions, Orders and Rulings
6. Only persons who are employees of a member of the Nexans Group during the subscription period for the Employee Share Offering and who meet other employment criteria (the “Qualifying Employees”) will be permitted to participate in the Employee Share Offering.
7. The Compartment was established for the purpose of implementing the Employee Share Offering and the Transfer Fund was especially established in order to receive assets transferred, at the end of the applicable lock-up period, from other compartments of the Fund established within the framework of employee share plans implemented by the Filer similar to the Employee Share Offering. The Compartment and the Transfer Fund have limited liability under French law. There is no current intention for the Compartment or the Transfer Fund to become a reporting issuer under the Legislation or the securities legislation of the Other Jurisdictions.
8. The Fund, the Compartment and the Transfer Fund have been registered with, and approved by, the Autorité des marchés financiers in France (the “French AMF”).
9. Under the Employee Share Offering, Canadian Participants will subscribe for Units, and the Compartment will then subscribe for Shares using the Employee Contribution (as described below) and certain financing made available by Société Générale (the “Bank”), which is a bank governed by the laws of France.
10. The subscription price for the Shares will be the average of the opening price of the Shares (expressed in Euros) on NYSE Euronext Paris on the 20 trading days preceding the date of the fixing of the subscription price by the Chief Executive Officer of the Filer, acting on the authority of the Board of Directors of the Filer (the “Reference Price”), less a 20% discount.
11. Canadian Participants will contribute the Canadian dollar equivalent of 16.66% of the price of each Share (expressed in Euros) they wish to subscribe for to the Compartment (the “Employee Contribution”). The Compartment will enter into a swap agreement (the “Swap Agreement”) with the Bank. Under the terms of the Swap Agreement, the Bank will contribute the remaining 83.34% of the price of each Share (expressed in Euros) to be subscribed for by the Compartment (the “Bank Contribution”).
12. The Compartment will apply the cash received from the Employee Contribution and the Bank Contribution to subscribe for Shares.
13. The Canadian Participants will receive Units in the Compartment entitling him or her to the Euro amount of the Employee Contribution and a multiple of the average increase in the Share price of the Shares subscribed on behalf of Canadian Participants (including the Shares financed by the Bank Contribution).
14. The Units will be subject to a hold period of five years (the “Lock-Up Period”), subject to certain exceptions prescribed by French law and adopted under the Employee Share Offering in Canada (such as death, disability or involuntary termination of employment).
15. Under the terms of the Swap Agreement, the Compartment will remit to the Bank an amount equal to the net amounts of any dividends paid on the Shares held in the Compartment during the Lock-Up Period. At the end of the Lock-Up Period, the Compartment will owe to the Bank an amount equal to A - [B+C], where
a) “A” is the market value of all the Shares at the end of the Lock-Up Period that are held in the Compartment (as determined pursuant to the terms of the Swap Agreement),
b) “B” is the aggregate amount of all Employee Contributions,
c) “C” is an amount (the “Appreciation Amount”) equal to
i) approximately 2.5 (or some other multiple, the final value of which will be determined and communicated to Canadian Participants prior to the finalization of their subscriptions) times the amount, if any, by which the Average Trading Price is greater than the Reference Price, where “Average Trading Price” is the average price of the Shares based on 60 monthly readings of the closing price of the Shares over the Lock-Up Period. In the event a closing price is less than the Reference Price, it will be substituted by the Reference Price;
and further multiplied by
ii) the number of Shares held in the Compartment.
November 27, 2014 (2014), 37 OSCB 10358
Decisions, Orders and Rulings
16. If, at the end of the Lock-Up Period, the market value of the Shares held in the Compartment is less than 100% of the Employee Contributions, the Bank will, pursuant to the terms and conditions of a guarantee contained in the Swap Agreement, make a contribution to the Compartment to make up any shortfall.
17. At the end of the Lock-Up Period, the Swap Agreement will terminate after the final swap payments. A Canadian Participant may then request the redemption of his or her Units in consideration for cash or Shares with a value representing:
(a) the Canadian Participant’s Employee Contribution; and
(b) the Canadian Participant’s portion of the Appreciation Amount, if any
(the “Redemption Formula”)
18. If a Canadian Participant does not request the redemption of his or her Units in the Compartment at the end of the Lock-Up Period, his or her investment in the Compartment will be transferred to the Transfer Fund (subject to the decision of the supervisory board of the Fund and the approval of the French AMF). Units of the Transfer Fund (the “Transfer Fund Units”) will be issued to such Canadian Participants in recognition of the assets transferred to the Transfer Fund. Canadian Participants may request the redemption of the Transfer Fund Units whenever they wish. Once a Canadian Participant becomes a unitholder of the Transfer Fund, he or she will be able to request the redemption of Transfer Fund Units at any time in consideration of the underlying Shares or a cash payment equal to the then market value of the Shares held by the Transfer Fund. However, following a transfer to the Transfer Fund, the Employee Contribution and the Appreciation Amount will not be covered by the Swap Agreement (including the Bank’s guarantee contained therein).
19. Pursuant to the terms of the guarantee contained in the Swap Agreement, a Canadian Participant will be entitled to receive 100% of his or her Employee Contribution (in Euro) at the end of the Lock-Up Period or in the event of an early unwind resulting from the Canadian Participant exercising one of the exceptions to the Lock-Up Period. The Management Company is permitted to cancel the Swap Agreement (which will have the effect of cancelling the guarantee) in certain strictly defined conditions where it is in the best interests of the holders of Units. The Management Company is required under French law to act in the best interests of the holders of the Units. In the event that the Management Company cancelled the Swap Agreement and this was not in the best interests of the holders of the Units, then such holders would have a right of action under French law against the Management Company. Under no circumstances will a Canadian Participant be responsible to contribute an amount greater than his or her Employee Contribution.
20. In the event of an early unwind resulting from the Canadian Participant satisfying one of the exceptions to the Lock-Up Period and meeting the applicable criteria, a Canadian Participant may request the redemption of Units from the Compartment. The value of the Units will be calculated in accordance with the Redemption Formula. The measurement of the increase, if any, from the Reference Price will be carried out in accordance with similar rules to those applied to redemption at the end of the Lock-up Period, but it will be measured using values of the Shares at the time of the unwind instead.
21. Under no circumstances will a Canadian Participant be liable to any of the Compartment, the Transfer Fund, the Bank or the Filer for any amounts in excess of his or her Employee Contribution under the Employee Share Offering.
22. For Canadian federal income tax purposes, a Canadian Participant should be deemed to receive all dividends paid on the Shares financed by either the Employee Contribution or the Bank Contribution at the time such dividends are paid to the Compartment, notwithstanding the actual non-receipt of the dividends by the Canadian Participants.
23. The declaration of dividends on the Shares (in the ordinary course or otherwise) is strictly decided by the shareholders of the Filer on the proposition of the Board of Directors. The Filer has not made any commitment to the Bank as to any minimum payment of dividends during the term of the Lock-Up Period.
24. To respond to the fact that, at the time of the initial investment decision relating to participation in the Employee Share Offering, Canadian Participants will be unable to quantify their potential income tax liability resulting from such participation, the Filer or the Canadian Affiliates are prepared to indemnify each Canadian Participant for all tax costs to the Canadian Participants associated with the payment of dividends in excess of a specified amount of Euros per calendar year per Share during the Lock-Up Period such that, in all cases, a Canadian Participant will, at the time of the original investment decision, be able to determine his or her maximum tax liability in connection with dividends received by the Compartment on his or her behalf under the Employee Share Offering.
November 27, 2014 (2014), 37 OSCB 10359
Decisions, Orders and Rulings
25. At the time the Compartment’s obligations under the Swap Agreement are settled, the Canadian Participant will realize a capital gain (or capital loss) by virtue of having participated in the Swap Agreement to the extent that amounts received by the Compartment, on behalf of the Canadian Participant, from the Bank exceed (or are less than) amounts paid by the Compartment, on behalf of the Canadian Participant, to the Bank. Any dividend amounts paid to the Bank under the Swap Agreement will serve to reduce the amount of any capital gain (or increase the amount of any capital loss) that the Canadian Participant would have realized. Capital losses (gains) realized by a Canadian Participant may generally be offset against (reduced by) any capital gains (losses) realized by the Canadian Participant on a disposition of the Shares, in accordance with the rules and conditions under the Income Tax Act (Canada) or comparable provincial legislation (as applicable).
26. The Compartment’s portfolio will almost exclusively consist of Shares as well as the rights and associated obligations under the Swap Agreement. The Compartment may also hold cash or cash equivalents pending investments in Shares and for the purposes of facilitating Unit redemptions.
27. Any dividends paid on the Shares held in the Transfer Fund will be contributed to the Transfer Fund and used to purchase additional Shares on the stock market. To reflect this reinvestment, either new Transfer Fund Units (or fractions thereof) will be issued to Canadian Participants or no additional Transfer Fund Units will be issued and the net asset value of Transfer Fund will be increased.
28. The Transfer Fund’s portfolio will almost entirely consist of Shares, and may also include, from time to time, cash in respect of dividends paid on the Shares which will be reinvested in additional Shares as well as cash or cash equivalents held for the purpose of investing in the Shares and redeeming Transfer Fund Units.
29. The Management Company is a portfolio management company governed by the laws of France. The Management Company is registered with the French AMF as an investment manager and complies with the rules of the French AMF. The Management Company is obliged to act in the best interests of the Canadian Participants and is liable to them, jointly and severally with the Depositary (as defined below), for any violation of the rules and regulations governing the FCPE, any violation of the rules of the FCPE, or for any self-dealing or negligence. To the best of the Filer’s knowledge, the Management Company is not, and has no current intention of becoming, a reporting issuer under the Legislation or the securities legislation of the Other Jurisdictions.
30. The Management Company’s portfolio management activities in connection with the Employee Share Offering and the Compartment are limited to subscribing for Shares from the Filer, selling such Shares as necessary in order to fund redemption requests, investing available cash in cash equivalents, and such activities as may be necessary to give effect to the Swap Agreement. The Management Company’s portfolio management activities in connection with the Transfer Fund will be limited to purchasing Shares from the Filer using Canadian Participants’ entitlement under the Employee Share Offering at the end of the Lock-Up Period (i.e. a Canadian Participant’s Employee Contribution plus his or her portion of the Appreciation Amount, if any, based on the Redemption Formula), selling Shares held by the Transfer Fund as necessary in order to fund redemption requests, and investing available cash in cash equivalents.
31. The Management Company is also responsible for preparing accounting documents and publishing periodic informational documents in respect of the Compartment and the Transfer Fund. The Management Company’s activities will not affect the value of the Shares.
32. None of the Filer, the Management Company, the Canadian Affiliates or any of their directors, officers, employees, agents or representatives will provide investment advice to the Qualifying Employees with respect to investments in the Shares or the Units.
33. Shares issued under the Employee Share Offering will be deposited in the Compartment’s accounts or the Transfer Fund’s accounts, as the case may be, with BNP Paribas Securities Services (the “Depositary”), a large French commercial bank subject to French banking legislation.
34. Participation in the Employee Share Offering is voluntary, and Canadian Employees will not be induced to participate in the Employee Share Offering by expectation of employment or continued employment.
35. The total amount that may be invested by a Canadian Participant in the Employee Share Offering cannot exceed 25% of a Canadian Participant’s estimated gross annual compensation (the 25% investment limit takes into account the Bank Contribution).
36. The Shares, Units and Transfer Fund Units are not currently listed for trading on any stock exchange in Canada and there is no intention to have the Shares, Units or Transfer Fund Units so listed. As there is no market for the Shares in Canada, and as none is expected to develop, any first trades of Shares by Canadian Participants will be effected through the facilities of, and in accordance with, the rules and regulations of an exchange outside of Canada.
November 27, 2014 (2014), 37 OSCB 10360
Decisions, Orders and Rulings
37. The Filer will retain a securities dealer registered as a broker/investment dealer (the “Registrant”) under the securities legislation of Ontario and Manitoba to provide advisory services to Canadian Employees resident in such provinces who express an interest in the Employee Share Offering and to make a determination, in accordance with industry practices, as to whether an investment in the Employee Share Offering is suitable for each such Canadian Employee based on his or her particular financial circumstances.
38. Canadian Employees will receive an information package in the French or English language, according to their preference, which will include a description of the terms of the Employee Share Offering and a description of Canadian income tax consequences of subscribing to and holding the Units and redeeming Units for cash or Shares at the end of the Lock-Up Period. The information package will also include a risk statement which will describe certain risks associated with an investment in Units. Canadian Employees may also consult the Filer’s Document de Référence (in French and English) filed with the French AMF in respect of the Shares and a copy of the Compartment’s rules (which are analogous to company by-laws). Canadian Employees will also have access to copies of the continuous disclosure materials relating to the Filer that are furnished to holders of Shares generally.
39. Canadian Participants will receive an initial statement of their holdings under the Employee Share Offering together with an updated statement at least once per year.
40. As of the date of the application of the Filer, there were approximately 571 Qualifying Employees resident in Canada, with the largest number residing in the Province of Ontario (approximately 320), and the remainder in the provinces of Alberta, Saskatchewan, Manitoba, Quebec and Nova Scotia, who represent, in the aggregate, approximately 2.2% of the number of employees in the Nexans Group worldwide.
41. The Filer is not, and none of the Canadian Affiliates are, in default of the Legislation or the securities legislation of the Other Jurisdictions. To the best of the Filer’s knowledge, the Management Company is not in default of the Legislation or the securities legislation of the Other Jurisdictions.
Decision
Each of the Decision Makers is satisfied that the decision meets the test set out in the Legislation for the Decision Makers to make the decision.
The decision of the Decision Makers under the Legislation is that the Offering Relief is granted provided that:
1. the prospectus requirements of the Legislation will apply to the first trade in any Units or Shares acquired by Canadian Participants pursuant to this Decision, unless the following conditions are met:
a) the issuer of the security
(i) was not a reporting issuer in any jurisdiction of Canada at the distribution date, or
(ii) is not a reporting issuer in any jurisdiction of Canada at the date of the trade;
b) at the distribution date, after giving effect to the issue of the security and any other securities of the same class or series that were issued at the same time as or as part of the same distribution as the security, residents of Canada:
(i) did not own directly or indirectly more than 10% of the outstanding securities of the class or series, and
(ii) did not represent in number more than 10% of the total number of owners directly or indirectly of securities of the class or series; and
c) the first trade is made:
(i) through an exchange, or a market, outside of Canada, or
(ii) to a person or company outside of Canada.
“Lucie J. Roy” Senior Director, Corporate Finance
November 27, 2014 (2014), 37 OSCB 10361
Decisions, Orders and Rulings
2.1.4 American Bonanza Gold Corp.
Headnote
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions – application for a decision that the issuer is not a reporting issuer under applicable securities laws – issuer in default of its obligation to file and deliver its financial statements and related management’s discussion and analysis – requested relief granted.
Applicable Legislative Provisions
Securities Act, R.S.O. 1990, c. S.5, as am., s. 1(10)(a)(ii). CSA Staff Notice 12-307 Applications for a Decision that an Issuer is not a Reporting Issuer.
November 19, 2014
IN THE MATTER OF THE SECURITIES LEGISLATION OF ALBERTA, SASKATCHEWAN, MANITOBA, ONTARIO, QUEBEC, NEW BRUNSWICK AND NEWFOUNDLAND & LABRADOR (the Jurisdictions)
AND
IN THE MATTER OF THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS IN MULTIPLE JURISDICTIONS
AND
IN THE MATTER OF AMERICAN BONANZA GOLD CORP. (the Filer)
DECISION
Background
The securities regulatory authority or regulator in each of the Jurisdictions (the Decision Maker) has received an application from the Filer for a decision under the securities legislation of the Jurisdictions (the Legislation) that the Filer is not a reporting issuer (the Exemptive Relief Sought).
Under National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions (for a coordinated review application):
(a) the Ontario Securities Commission is the Principal Regulator for this application; and
(b) the decision is the decision of the principal regulator and evidences the decision of each other Decision Maker.
Interpretation
Terms defined in National Instrument 14-101 – Definitions and MI 11-102 – Passport System have the same meaning as if used in this decision, unless otherwise defined.
Representations
This decision is based on the following facts represented by the Filer:
1. The Filer was incorporated pursuant to the Business Corporations Act (British Columbia) on December 10, 2004.
2. The Filer’s head office is located in Toronto, Ontario.
3. The Filer is currently a reporting issuer in each of the Jurisdictions and is not a reporting issuer or the equivalent in any other jurisdiction of Canada.
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Decisions, Orders and Rulings
4. The authorized share capital of the Filer consists of an unlimited number of common shares.
5. On June 27, 2014, pursuant to a plan of arrangement among Kerr Mines Inc. (Kerr Mines), 0999415 B.C. Ltd. (Kerr Subco), a wholly-owned subsidiary of Kerr Mines and the Filer, Kerr Mines acquired ownership and control of 1,121,186,339 common shares of the Filer, being all of the issued and outstanding common shares of the Filer, in consideration for 594,228,760 common shares of Kerr Mines.
6. On June 27, 2014, by articles of amalgamation certified by the Province of British Columbia Registrar of Companies, Kerr Subco and the Filer amalgamated to form American Bonanza Gold Corp. As a result of the amalgamation the Filer is a wholly-owned subsidiary of Kerr Mines.
7. The common shares of the Filer were delisted from the Toronto Stock Exchange at the close of business on July 7, 2014.
8. No securities of the Filer, including any debt securities are traded in Canada or another country on a marketplace, as defined in National Instrument 21-101 – Marketplace Operation or any other facility for bringing together buyers and sellers of securities where trading data is publicly reported.
9. Effective August 4, 2014, the Filer successfully surrendered its status as a reporting issuer in British Columbia pursuant to BC Instrument 11-102 Voluntary Surrender of Reporting Issuer Status.
10. The outstanding securities of the Filer, including debt securities, are beneficially owned, directly or indirectly, by fewer than 15 securityholders in each of the jurisdictions of Canada and fewer than 51 securityholders in total worldwide.
11. The Filer is not in default of any of its obligations under the Legislation as a reporting issuer, other than an obligation to file on or before August 15, 2014, its interim financial statements and management discussion and analysis in respect of such statements for the period ended June 30, 2014, as required under National Instrument 51-102 – Continuous Disclosure Obligations and the related certificates as required under National Instrument 52-109 – Certification of Disclosure in Issuer’s Annual and Interim Filings (collectively, the Filings).
12. The Filer is applying for a decision that it is not a reporting issuer in all of the Jurisdictions.
13. The Filer is not eligible to use the simplified procedure under CSA Staff Notice 12-307 – Applications for a Decision that an Issuer is not a Reporting Issuer as it is in default for failure to file the Filings.
14. The Filer has no current intention to seek public financing by way of an offering of securities.
15. The Filer, upon the receipt of the decision and the granting of the Exemptive Relief Sought, will no longer be a reporting issuer or the equivalent thereof in any jurisdiction in Canada.
Decision
Each of the Decision Makers is satisfied that the decision meets the test set out in the Legislation for the Decision Maker to make the Decision.
The decision of the Decision Makers under the Legislation is that the Exemptive Relief Sought is granted.
“Edward P. Kerwin” Ontario Securities Commission
“Judith Robertson” Ontario Securities Commission
November 27, 2014 (2014), 37 OSCB 10363
Decisions, Orders and Rulings
2.1.5 TransCanada PipeLines Limited and TransCanada Trust
Headnote
Multilateral Instrument 11-102 Passport System and National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions – trust to be established by filer to issue securities to the public – structure created in order to obtain favourable ratings treatment – trust not currently a reporting issuer – filer will be credit supporter to trust – trust exempted from eligibility requirements to file a short form prospectus and 10-day notice requirement – trust to meet section 2.4 of NI 44-101 except for the requirement that the securities be non-convertible, and other conditions – order confidential until the earlier of the filing of a preliminary prospectus by the trust or 90 days from the date of the decision.
Applicable Legislative Provisions
National Instrument 44-101 Short Form Prospectus Distributions, ss. 2.1(1), 2.1(2), 2.8, 8.1.
Citation: Re TransCanada PipeLines Limited, 2014 ABASC 322
August 20, 2014
IN THE MATTER OF THE SECURITIES LEGISLATION OF ALBERTA AND ONTARIO (the Jurisdictions)
AND
IN THE MATTER OF THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS IN MULTIPLE JURISDICTIONS
AND
IN THE MATTER OF TRANSCANADA PIPELINES LIMITED (the Filer or TCPL)
AND
TRANSCANADA TRUST (the Trust)
DECISION
Background
The securities regulatory authority or regulator in each of the Jurisdictions (the Decision Maker) has received an application from the Filer for a decision (the Exemptions Sought) under the securities legislation of the Jurisdictions (the Legislation) that the Trust be exempted from the following requirements of National Instrument 44-101 Short Form Prospectus Distributions (NI 44-101) in connection with offerings by the Trust (each, an Offering) from time to time of Trust Notes (as defined herein):
(a) subsection 2.1(1);
(b) subsection 2.1(2), to the extent that it requires qualification under any of sections 2.2 through 2.6; and
(c) that part of section 2.8 that requires a 10 business day period.
Furthermore, the Decision Makers have received a request from the Filer for a decision that the application and this decision be kept confidential and not made public until the earlier of: (i) the date that the Trust files its first preliminary short form prospectus in respect of an Offering; and (ii) 90 days from the date of this Decision (the Confidentiality Sought).
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a dual application):
(a) the Alberta Securities Commission is the principal regulator for the application;
November 27, 2014 (2014), 37 OSCB 10364
Decisions, Orders and Rulings
(b) the Filer has provided notice that subsection 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11- 102) is intended to be relied upon in British Columbia, Saskatchewan, Manitoba, Québec, New Brunswick, Nova Scotia, Prince Edward Island, Newfoundland and Labrador, Yukon, the Northwest Territories and Nunavut; and
(c) this decision is the decision of the principal regulator and evidences the decision of the securities regulatory authority or regulator in Ontario.
Interpretation
Terms defined in National Instrument 14-101 Definitions or MI 11-102 have the same meaning if used in this decision, unless otherwise defined herein.
Representations
This decision is based on the following facts represented by the Filer:
TCPL and TransCanada Corporation
1. TCPL is a corporation incorporated under the Canada Business Corporations Act (the CBCA). The head office of TCPL is in Calgary, Alberta.
2. TCPL is a leading North American energy infrastructure company whose business is focused on natural gas pipelines, oil pipelines and energy. Its natural gas pipelines and oil pipelines are principally comprised respectively of pipelines in Canada, the United States and Mexico as well as regulated natural gas storage operations in the United States. Its energy business includes power operations and the non-regulated natural gas storage business in Canada.
3. TCPL’s authorized share capital consists of an unlimited number of: (i) common shares; (ii) first preferred shares; and (iii) second preferred shares. As at the date hereof, TCPL’s issued and outstanding shares consist of common shares.
4. All of TCPL’s issued and outstanding common shares are owned directly by TransCanada Corporation (TCC). None of TCPL’s issued securities are listed or traded on a public market.
5. TCC is a corporation incorporated under the CBCA. The head office of TCC is in Calgary, Alberta. TCC’s common shares are listed on the Toronto Stock Exchange and the New York Stock Exchange. In addition, TCC has outstanding five series of cumulative redeemable first preferred shares which are also listed on the Toronto Stock Exchange.
6. Each of TCPL and TCC is a reporting issuer in each province and territory of Canada and is not in default of securities legislation in any jurisdiction.
7. TCPL is qualified under section 2.3 of NI 44-101 to use the short form prospectus system. TCC is qualified under section 2.2 of NI 44-101 to use the short form prospectus system.
The Trust and the Trust Notes
8. The Trust will be established under the laws of the Province of Ontario pursuant to a declaration of trust.
9. As a newly-formed entity, the Trust will have no operating history. The Trust will issue voting trust units (the Voting Trust Units), which will be the only equity securities issued by the Trust. All of the Voting Trust Units will be held, directly or indirectly, by TCPL.
10. TCPL will covenant that it will maintain direct or indirect ownership of 100% of the outstanding Voting Trust Units.
11. The Trust proposes to conduct an initial public offering of subordinated notes of the Trust to be designated “Trust Notes – Series 2014-A” (the Trust Notes – Series 2014-A). The Trust proposes to file a prospectus relating to the initial public offering in certain jurisdictions of Canada, including Alberta and Ontario, and to conduct the same primarily in the United States under a registration statement on Form F-10 filed with the SEC under the multijurisdictional disclosure system available to Canadian issuers. In addition, the Trust may, from time to time, issue further series of similar trust notes (together with the Trust Notes – Series 2014-A, Trust Notes) in either or both of Canada and the United States.
12. As a result of the initial public offering, the Trust will become a reporting issuer in each province or territory of Canada in which a receipt for a prospectus is obtained.
November 27, 2014 (2014), 37 OSCB 10365
Decisions, Orders and Rulings
13. The purpose of the Trust will be to effect offerings of Trust Notes in order to provide TCPL with funds for general corporate purposes by means of: (i) creating and selling Trust Notes; and (ii) acquiring and holding assets, which will consist primarily of one or more junior subordinated unsecured notes issued by TCPL to the Trust (TCPL Sub Notes, and together with the other assets of the Trust, the Trust Assets). The Trust Assets will generate funds for distribution to holders of Trust Notes and Voting Trust Units. The Trust will not carry on any operating activity other than in connection with Offerings and in connection with acquiring and holding the Trust Assets.
14. The terms of each particular series of Trust Notes will be described in detail in the applicable prospectus.
15. The Trust Notes - Series 2014-A will be denominated in U.S. dollars and will require the Trust to pay interest on such date(s) (Interest Payment Dates) as may be described in the prospectus pertaining thereto. The Trust Notes - Series 2014-A will mature in 2074.
16. The Trust Notes – Series 2014-A will be automatically exchanged, without the consent of the holder, for the right to be issued a new series of cumulative first preferred shares of TCPL (TCPL Exchange Preferred Shares) upon the occurrence of certain events relating to the insolvency of TCC or TCPL (an Automatic Exchange).
17. The structure of the Trust and the Trust Notes is intended to result in certain treatment from credit rating organizations. Specifically, due to this structure, it is expected that credit rating organizations will treat the Trust Notes as 50% equity and 50% debt, as opposed to 100% debt. The features of the Trust Notes, including the issuance of TCPL Exchange Preferred Shares upon an Automatic Exchange and the issuance of TCPL Deferral Preferred Shares (as defined below) upon a Deferral Event (as defined below), are designed to satisfy the requirements of credit rating organizations to qualify for the desired treatment.
Credit Support
18. TCPL will guarantee, on a subordinated basis, the due and punctual payment of the principal amount of and interest on (including interest on the amount in default) the Trust Notes – Series 2014-A and performance by the Trust of all the Trust’s obligations to the holders of the Trust Notes – Series 2014-A.
19. TCPL’s outstanding senior unsecured debt is currently rated “A (low)” by DBRS Limited (DBRS), “A3” by Moody’s Investor Service, Inc. (Moody’s) and “A-” by Standard and Poor’s Ratings Services (S&P), and its outstanding junior subordinated notes are currently rated “BBB (high)” by DBRS, “Baa1” by Moody’s and “BBB” by S&P.
20. With respect to the initial public offering, the Trust and TCPL will meet the requirements of section 2.4 of NI 44-101, except for the possibility that the Trust Notes – Series 2014-A could be considered to be convertible, because of the possibility of either a Deferral Event (as defined below) or an Automatic Exchange.
21. By virtue of TCPL’s credit support, the Trust will be subject to Item 12 of Form 44-101F1 Short Form Prospectus. With respect to ongoing disclosure after the initial public offering, the Trust expects to rely on the exemption for credit support issuers set out in section 13.4 of National Instrument 51-102 Continuous Disclosure Obligations.
Other Information
22. Under the terms of an assignment and set-off agreement (the Assignment and Set-Off Agreement) to be entered into among the Trust, TCC, TCPL and an indenture trustee, it is possible that under certain circumstances holders of the Trust Notes – Series 2014-A will receive a new series of preferred shares (TCPL Deferral Preferred Shares) instead of interest (any such instance being a Deferral Event). However, it is in the interest of each of TCC and TCPL to ensure that, to the extent within their respective control, the Trust pays interest to holders of the Trust Notes – Series 2014-A in cash on the Interest Payment Date. This is because the Assignment and Set-Off Agreement provides, among other things, that should a Deferral Event occur and be continuing, TCC and TCPL will not declare dividends on their respective outstanding preferred shares or, if no such preferred shares are outstanding, their respective common shares.
23. Because of TCPL’s credit support, the terms of the Trust Notes, and the fact that the assets of the Trust will consist primarily of TCPL Sub Notes, information concerning the business and affairs of TCPL, as opposed to those of the Trust, is most meaningful to holders of Trust Notes.
Decision
Each of the Decision Makers is satisfied that the decision meets the test set out in the Legislation for the Decision Maker to make the decision.
November 27, 2014 (2014), 37 OSCB 10366
Decisions, Orders and Rulings
1. The decision of the Decision Makers under the Legislation is that the Exemptions Sought are granted in respect of each Offering, provided that in respect of each Offering:
(a) TCPL remains the direct or indirect owner of all of the outstanding Voting Trust Units;
(b) the Trust has minimal assets, operations, revenues or cash flows other than those related to acquiring, holding and administering Trust Assets or issuing, administering or repaying Trust Notes;
(c) the Trust, TCPL and the Trust Notes will meet the requirements of section 2.4 of NI 44-101, except for the requirement that the Trust Notes be non-convertible;
(d) the features of the Assignment and Set-Off Agreement described in this decision apply, whether pursuant to the Assignment and Set-Off Agreement or pursuant to another similar agreement; and
(e) TCPL, as holder of the Voting Trust Units, will not propose changes to the terms and conditions of any outstanding Trust Notes offered and sold pursuant to a short form prospectus of the Trust filed in reliance on this decision that would result in securities other than TCPL first preferred shares being issued in exchange for Trust Notes or as payment to a holder of Trust Notes.
2. Furthermore, the decision of the Decision Makers is that the Confidentiality Sought is granted.
“Denise Weeres” Manager, Legal Corporate Finance
November 27, 2014 (2014), 37 OSCB 10367
Decisions, Orders and Rulings
2.1.6 1832 Asset Management L.P.
Headnote
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions – Existing and future mutual funds managed by the Filer granted relief from paragraphs 15.3(4)(c) and (f) of NI 81-102 Investment Funds to permit references to Lipper Leader ratings and Lipper Awards in sales communications – Relief subject to conditions requiring specified disclosure and the requirement that the Lipper Awards being referenced not have been awarded more than 365 days before the date of the sales communication.
Applicable Legislative Provisions
National Instrument 81-102 Investment Funds, ss. 15.3(4)(c) and (f), 19.1.
November 3, 2014
IN THE MATTER OF THE SECURITIES LEGISLATION OF ONTARIO (the Jurisdiction)
AND
IN THE MATTER OF THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS IN MULTIPLE JURISDICTIONS
AND
IN THE MATTER OF 1832 ASSET MANAGEMENT L.P.
DECISION
Background
The principal regulator in the Jurisdiction has received an application from 1832 Asset Management L.P. (the Filer) on behalf of existing mutual funds and future mutual funds of which the Filer is or becomes the investment fund manager (or of which an affiliate of the Filer becomes the investment fund manager) and to which National Instrument 81-102 Investment Funds (NI 81- 102) applies (each a Fund and collectively, the Funds) for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) for an exemption from the requirements set out in sections 15.3(4)(c) and 15.3(4)(f) of NI 81-102, which provide that a sales communication must not refer to a performance rating or ranking of a mutual fund or asset allocation service unless:
(i) the rating or ranking is provided for each period for which standard performance data is required to be given, except the period since the inception of the mutual fund
(ii) the rating or ranking is to the same calendar month end that is:
(a) not more than 45 days before the date of the appearance or use of the advertisement in which it is included, and
(b) not more than three months before the date of first publication of any other sales communication in which it is included
(together, the Exemption Sought), to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to the Funds.
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission is the principal regulator for this application, and
November 27, 2014 (2014), 37 OSCB 10368
Decisions, Orders and Rulings
(b) the Filer has provided notice that section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in each of the other provinces and territories of Canada (together with Ontario, the Jurisdictions).
Interpretation
Terms defined in National Instrument 14-101 Definitions, MI 11-102 and NI 81-102 have the same meaning if used in this decision, unless otherwise defined.
Representations
This decision is based on the following facts represented by the Filer:
1. The Filer is the investment fund manager of the Funds and is registered as an investment fund manager in one or more of the Jurisdictions. The head office of the Filer is located in Ontario.
2. Each of the Funds is, or will be, an open-ended mutual fund established under the laws of Canada or a jurisdiction of Canada. The securities of each of the Funds are, or will be, qualified for distribution pursuant to a prospectus that has been, or will be, prepared and filed in accordance with the securities legislation of each applicable Jurisdiction. Each of the Funds is, or will be, a reporting issuer in one or more of the Jurisdictions. Each of the Funds is or will be subject to NI 81-102, including Part 15 of NI 81-102, which governs sales communications.
3. The Filer and the Funds are not in default of the securities legislation in any of the Jurisdictions.
4. The Filer wishes to include in sales communications of the Funds references to Lipper Leader ratings and Lipper Awards (where such Funds have been awarded a Lipper Award).
5. Lipper, Inc. (Lipper) is a company that is not a member of the organization of the Funds. Lipper is part of the Thomson Reuters group of companies, and is a global leader in supplying mutual fund information, analytical tools, and commentary. Lipper's fund data and analysis, fund awards designations and ratings information provide valuable insight to advisors, media and individual investors.
6. One of Lipper’s programs is the Lipper awards program. This program highlights funds that have excelled in delivering consistently strong risk-adjusted performance relative to peers and also recognizes fund families with high average scores for all funds within a particular asset class or overall. Currently the Lipper awards take place in approximately 13 countries.
7. In Canada, the Lipper Awards include the Lipper Fund Awards and Lipper ETF Awards (which will be awarded for the first time in Canada in 2014). For the Lipper Fund Awards, Lipper designates award-winning funds in most individual fund classifications for three, five and ten year periods. For the Lipper ETF Awards, Lipper will designate award- winning funds in a number of individual fund classifications for the three year period, and it is expected that awards for the five and ten year periods will be given in the future.
8. The categories for fund classification used by Lipper for the Lipper Awards in respect of Canadian funds are those maintained by the Canadian Investment Funds Standards Committee (CIFSC) (or a successor to the CIFSC), a Canadian organization that is independent of Lipper. Only those CIFSC groups of ten or more unique funds will claim a Lipper Fund Award, and only those CIFSC groups of five or more unique ETFs (each of whom have a minimum of three years of performance history) will claim a Lipper ETF Award.
9. The Lipper Awards are based on a proprietary rating methodology prepared by Lipper, the Lipper Leader Rating System. The Lipper Leader Rating System is a toolkit that uses investor-centred criteria to deliver a simple, clear description of a fund's success in meeting certain goals, such as preserving capital, lowering expenses or building wealth. Lipper Ratings provide an instant measure of a fund’s success against a specific set of key metrics, and can be useful to investors in identifying funds that meet particular characteristics.
10. In Canada, the Lipper Leader Rating System includes Lipper Leader ratings for Consistent Return (reflecting funds’ historical risk-adjusted returns relative to funds in the same classification), for Total Return (reflecting funds’ historical total return performance relative to funds in the same classification) and for Preservation (reflecting funds’ historical loss avoidance relative to other funds in the same classification). In each case, the categories for fund classification used by Lipper for the Lipper Leader ratings are those maintained by CIFSC (or a successor to the CIFSC). Lipper Leader ratings are measured monthly over 36, 60 and 120 month periods, and an overall rating is also measured, which is an un-weighted average of the previous three periods. The highest 20% of funds in each category are named
November 27, 2014 (2014), 37 OSCB 10369
Decisions, Orders and Rulings
Lipper Leaders for that particular rating and receive a score of 5, the next 20% receive a score of 4, the middle 20% are scored 3, the next 20% are scored 2 and the lowest 20% are scored 1.
11. The Lipper Awards, awarded annually in Canada, are based on the Lipper Ratings for Consistent Return measure, which, as generally described above, is a risk-adjusted mutual fund return performance measure used by Lipper that takes into account both short- and long-term risk-adjusted performance relative to fund classification, together with a measure of a fund’s consistency. In respect of the Lipper Awards for Canada, the Lipper Ratings for Consistent Return are measured over the 36, 60 and 120 month periods ending at the end of July of each year. As noted above, the highest 20% of funds in each classification are named Lipper Leaders for Consistent Return, and the highest Lipper Leader for Consistent Return in each applicable fund classification over these periods (currently, in the case of the Lipper ETF Awards, over the 36 month period only) wins a Lipper Award.
12. When a Fund is awarded a Lipper Award, it may make reference to the award in sales communications subject to the terms of a license agreement with Lipper.
13. The Lipper Leader ratings are performance ratings or rankings under NI 81-102 and Lipper Awards for Funds may be considered to be performance ratings or rankings given that the awards are based on the Lipper Leader ratings as described above. Therefore, references to Lipper Leader ratings and Lipper Awards in sales communications relating to the Funds need to meet the applicable requirements in Part 15 of NI 81-102.
14. Section 15.3(4)(c) of NI 81-102 imposes a “matching” requirement for performance ratings or rankings that are included in sales communications for funds. If a performance rating or ranking is referred to in a sales communication, the performance rating or ranking must be provided for, or “match”, each period for which standard performance data is required to be given for the fund except the period since the inception of the fund (i.e., for one, three, five and ten year periods, as applicable).
15. In Canada and elsewhere, Lipper Leader ratings are calculated only for 36, 60 and 120 month periods and are not calculated for a one year period. This means that a sales communication referencing a Lipper Leader rating cannot comply with the “matching” requirement contained in section 15.3(4)(c) of NI 81-102 because a rating is not available for the one year period. Relief from section 15.3(4)(c) of NI 81-102 is therefore required in order for Funds to reference Lipper Leader ratings in sales communications.
16. In addition, a sales communication referencing the overall Lipper Leader ratings and the Lipper Awards, which are based on the Lipper Leader ratings, must disclose the corresponding Lipper Leader rating for each period for which standard performance data is required to be given. As noted above, because a rating for the one year period is not available for the Lipper Leader ratings, sales communications referencing the overall Lipper Leader ratings or Lipper Awards also cannot comply with the matching requirement contained in section 15.3(4)(c) of NI 81-102.
17. The exemption in section 15.3(4.1) of NI 81-102 for references to overall ratings or rankings of funds cannot be relied upon to reference the overall Lipper Leader ratings or Lipper Awards in sales communications for the Funds because section 15.3(4.1) is available only if a sales communication “otherwise complies” with the requirements of section 15.3(4). As noted above, sales communications referencing the overall Lipper Leader ratings or Lipper Awards cannot comply with the matching requirement in section 15.3(4) because the underlying Lipper Leader ratings are not available for the one year period, rendering the exemption in section 15.3(4.1) unavailable. Relief from section 15.3(4)(c) is therefore required in order for Funds to reference overall Lipper Leader ratings and the Lipper Awards in sales communications.
18. Section 15.3(4)(f) of NI 81-102 imposes certain restrictions on disclosure in sales communications. The section provides that in order for a rating or ranking such as a Lipper Award to be used in an advertisement, the advertisement must be published within 45 days of the calendar month end to which the rating or ranking applies. Further, in order for the rating or ranking to be used in any other sales communication, the rating or ranking must be published within three months of the calendar month end to which the rating or ranking applies.
19. Because the evaluation of funds for the Lipper Awards will be based on data aggregated until the end of July in any given year and the results will be published in November of that year, by the time a Fund receives an award in November, section 15.3(4)(f) of NI 81-102 will prohibit it from publishing news of the award altogether.
20. The Exemption Sought is required in order for Lipper Leader ratings and Lipper Awards to be referenced in sales communications relating to the Funds.
21. The Filer submits that the Lipper Awards provide an important tool for investors, as they provide investors with context when evaluating investment choices. The Filer submits that the nature of the Lipper Leader ratings and Lipper Awards alleviates any concern that references to the ratings and awards may be misleading and therefore contrary to section
November 27, 2014 (2014), 37 OSCB 10370
Decisions, Orders and Rulings
15.2(1)(a) of NI 81-102. The Lipper Leader Rating System underlying the Lipper Leader ratings and Lipper Awards ensures an objective, transparent and quantitative measure of performance that is based on the expertise of Lipper in fund analysis.
Decision
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator under the Legislation is that the Exemption Sought is granted to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to a Fund provided that:
1. the sales communication that refers to the Lipper Award and Lipper Leader ratings complies with Part 15 of NI 81-102 other than as set out herein and contains the following disclosure in at least 10 point type:
(a) the name of the category for which the Fund has received the award or rating;
(b) the number of mutual funds in the category for the applicable period;
(c) the name of the ranking entity, i.e., Lipper;
(d) the length of period and the ending date, or, the first day of the period and the ending date on which the Lipper Award or Lipper Leader rating is based;
(e) a statement that Lipper Leader ratings are subject to change every month;
(f) in the case of a Lipper Award, a brief overview of the Lipper Awards;
(g) in the case of a Lipper Leader rating (other than Lipper Leader ratings referenced in connection with a Lipper Award), a brief overview of the Lipper Leader rating;
(h) where Lipper Awards are referenced, the corresponding Lipper Leader rating that the Lipper Award is derived from is presented for each period for which standard performance data is required other than the one year and since inception periods;
(i) where a Lipper Leader rating is referenced, the Lipper Leader ratings are presented for each period for which standard performance data is required other than the one year and since inception periods;
(j) disclosure of the meaning of the Lipper Leader ratings from 1 to 5 (e.g., ranking of 5 indicates a fund is in the top 20% of its category);
(k) reference to Lipper’s website (www.lipperweb.com) for greater detail on the Lipper Awards and Lipper Leader ratings;
2. the Lipper Awards being referenced must not have been awarded more than 365 days before the date of the sales communication; and
3. the Lipper Awards and Lipper Leader ratings being referenced are calculated based on comparisons of performance of investment funds within a specified category established by the CIFSC (or a successor to the CIFSC).
“Vera Nunes” Manager, Investment Funds and Structured Products Ontario Securities Commission
November 27, 2014 (2014), 37 OSCB 10371
Decisions, Orders and Rulings
2.1.7 Aegon Fund Management Inc.
Headnote
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions – Existing and future mutual funds managed by the Filer granted relief from paragraphs 15.3(4)(c) and (f) of NI 81-102 Investment Funds to permit references to Lipper Leader ratings and Lipper Awards in sales communications – Relief subject to conditions requiring specified disclosure and the requirement that the Lipper Awards being referenced not have been awarded more than 365 days before the date of the sales communication.
Applicable Legislative Provisions
National Instrument 81-102 Investment Funds, ss. 15.3(4)(c) and (f), 19.1.
November 3, 2014
IN THE MATTER OF THE SECURITIES LEGISLATION OF ONTARIO (the Jurisdiction)
AND
IN THE MATTER OF THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS IN MULTIPLE JURISDICTIONS
AND
IN THE MATTER OF AEGON FUND MANAGEMENT INC.
DECISION
Background
The principal regulator in the Jurisdiction has received an application from Aegon Fund Management Inc. (the Filer) on behalf of existing mutual funds and future mutual funds of which the Filer is or becomes the investment fund manager (or of which an affiliate of the Filer becomes the investment fund manager) and to which National Instrument 81-102 Investment Funds (NI 81- 102) applies (each a Fund and collectively, the Funds) for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) for an exemption from the requirements set out in sections 15.3(4)(c) and 15.3(4)(f) of NI 81-102, which provide that a sales communication must not refer to a performance rating or ranking of a mutual fund or asset allocation service unless:
(i) the rating or ranking is provided for each period for which standard performance data is required to be given, except the period since the inception of the mutual fund
(ii) the rating or ranking is to the same calendar month end that is:
(a) not more than 45 days before the date of the appearance or use of the advertisement in which it is included, and
(b) not more than three months before the date of first publication of any other sales communication in which it is included
(together, the Exemption Sought), to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to the Funds.
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission is the principal regulator for this application, and
November 27, 2014 (2014), 37 OSCB 10372
Decisions, Orders and Rulings
(b) the Filer has provided notice that section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in each of the other provinces and territories of Canada (together with Ontario, the Jurisdictions).
Interpretation
Terms defined in National Instrument 14-101 Definitions, MI 11-102 and NI 81-102 have the same meaning if used in this decision, unless otherwise defined.
Representations
This decision is based on the following facts represented by the Filer:
1. The Filer is the investment fund manager of the Funds and is registered as an investment fund manager in one or more of the Jurisdictions. The head office of the Filer is located in Ontario.
2. Each of the Funds is, or will be, an open-ended mutual fund established under the laws of Canada or a jurisdiction of Canada. The securities of each of the Funds are, or will be, qualified for distribution pursuant to a prospectus that has been, or will be, prepared and filed in accordance with the securities legislation of each applicable Jurisdiction. Each of the Funds is, or will be, a reporting issuer in one or more of the Jurisdictions. Each of the Funds is or will be subject to NI 81-102, including Part 15 of NI 81-102, which governs sales communications.
3. The Filer and the Funds are not in default of the securities legislation in any of the Jurisdictions.
4. The Filer wishes to include in sales communications of the Funds references to Lipper Leader ratings and Lipper Awards (where such Funds have been awarded a Lipper Award).
5. Lipper, Inc. (Lipper) is a company that is not a member of the organization of the Funds. Lipper is part of the Thomson Reuters group of companies, and is a global leader in supplying mutual fund information, analytical tools, and commentary. Lipper's fund data and analysis, fund awards designations and ratings information provide valuable insight to advisors, media and individual investors.
6. One of Lipper’s programs is the Lipper awards program. This program highlights funds that have excelled in delivering consistently strong risk-adjusted performance relative to peers and also recognizes fund families with high average scores for all funds within a particular asset class or overall. Currently the Lipper awards take place in approximately 13 countries.
7. In Canada, the Lipper Awards include the Lipper Fund Awards and Lipper ETF Awards (which will be awarded for the first time in Canada in 2014). For the Lipper Fund Awards, Lipper designates award-winning funds in most individual fund classifications for three, five and ten year periods. For the Lipper ETF Awards, Lipper will designate award- winning funds in a number of individual fund classifications for the three year period, and it is expected that awards for the five and ten year periods will be given in the future.
8. The categories for fund classification used by Lipper for the Lipper Awards in respect of Canadian funds are those maintained by the Canadian Investment Funds Standards Committee (CIFSC) (or a successor to the CIFSC), a Canadian organization that is independent of Lipper. Only those CIFSC groups of ten or more unique funds will claim a Lipper Fund Award, and only those CIFSC groups of five or more unique ETFs (each of whom have a minimum of three years of performance history) will claim a Lipper ETF Award.
9. The Lipper Awards are based on a proprietary rating methodology prepared by Lipper, the Lipper Leader Rating System. The Lipper Leader Rating System is a toolkit that uses investor-centred criteria to deliver a simple, clear description of a fund's success in meeting certain goals, such as preserving capital, lowering expenses or building wealth. Lipper Ratings provide an instant measure of a fund’s success against a specific set of key metrics, and can be useful to investors in identifying funds that meet particular characteristics.
10. In Canada, the Lipper Leader Rating System includes Lipper Leader ratings for Consistent Return (reflecting funds’ historical risk-adjusted returns relative to funds in the same classification), for Total Return (reflecting funds’ historical total return performance relative to funds in the same classification) and for Preservation (reflecting funds’ historical loss avoidance relative to other funds in the same classification). In each case, the categories for fund classification used by Lipper for the Lipper Leader ratings are those maintained by CIFSC (or a successor to the CIFSC). Lipper Leader ratings are measured monthly over 36, 60 and 120 month periods, and an overall rating is also measured, which is an un-weighted average of the previous three periods. The highest 20% of funds in each category are named
November 27, 2014 (2014), 37 OSCB 10373
Decisions, Orders and Rulings
Lipper Leaders for that particular rating and receive a score of 5, the next 20% receive a score of 4, the middle 20% are scored 3, the next 20% are scored 2 and the lowest 20% are scored 1.
11. The Lipper Awards, awarded annually in Canada, are based on the Lipper Ratings for Consistent Return measure, which, as generally described above, is a risk-adjusted mutual fund return performance measure used by Lipper that takes into account both short- and long-term risk-adjusted performance relative to fund classification, together with a measure of a fund’s consistency. In respect of the Lipper Awards for Canada, the Lipper Ratings for Consistent Return are measured over the 36, 60 and 120 month periods ending at the end of July of each year. As noted above, the highest 20% of funds in each classification are named Lipper Leaders for Consistent Return, and the highest Lipper Leader for Consistent Return in each applicable fund classification over these periods (currently, in the case of the Lipper ETF Awards, over the 36 month period only) wins a Lipper Award.
12. When a Fund is awarded a Lipper Award, it may make reference to the award in sales communications subject to the terms of a license agreement with Lipper.
13. The Lipper Leader ratings are performance ratings or rankings under NI 81-102 and Lipper Awards for Funds may be considered to be performance ratings or rankings given that the awards are based on the Lipper Leader ratings as described above. Therefore, references to Lipper Leader ratings and Lipper Awards in sales communications relating to the Funds need to meet the applicable requirements in Part 15 of NI 81-102.
14. Section 15.3(4)(c) of NI 81-102 imposes a “matching” requirement for performance ratings or rankings that are included in sales communications for funds. If a performance rating or ranking is referred to in a sales communication, the performance rating or ranking must be provided for, or “match”, each period for which standard performance data is required to be given for the fund except the period since the inception of the fund (i.e., for one, three, five and ten year periods, as applicable).
15. In Canada and elsewhere, Lipper Leader ratings are calculated only for 36, 60 and 120 month periods and are not calculated for a one year period. This means that a sales communication referencing a Lipper Leader rating cannot comply with the “matching” requirement contained in section 15.3(4)(c) of NI 81-102 because a rating is not available for the one year period. Relief from section 15.3(4)(c) of NI 81-102 is therefore required in order for Funds to reference Lipper Leader ratings in sales communications.
16. In addition, a sales communication referencing the overall Lipper Leader ratings and the Lipper Awards, which are based on the Lipper Leader ratings, must disclose the corresponding Lipper Leader rating for each period for which standard performance data is required to be given. As noted above, because a rating for the one year period is not available for the Lipper Leader ratings, sales communications referencing the overall Lipper Leader ratings or Lipper Awards also cannot comply with the matching requirement contained in section 15.3(4)(c) of NI 81-102.
17. The exemption in section 15.3(4.1) of NI 81-102 for references to overall ratings or rankings of funds cannot be relied upon to reference the overall Lipper Leader ratings or Lipper Awards in sales communications for the Funds because section 15.3(4.1) is available only if a sales communication “otherwise complies” with the requirements of section 15.3(4). As noted above, sales communications referencing the overall Lipper Leader ratings or Lipper Awards cannot comply with the matching requirement in section 15.3(4) because the underlying Lipper Leader ratings are not available for the one year period, rendering the exemption in section 15.3(4.1) unavailable. Relief from section 15.3(4)(c) is therefore required in order for Funds to reference overall Lipper Leader ratings and the Lipper Awards in sales communications.
18. Section 15.3(4)(f) of NI 81-102 imposes certain restrictions on disclosure in sales communications. The section provides that in order for a rating or ranking such as a Lipper Award to be used in an advertisement, the advertisement must be published within 45 days of the calendar month end to which the rating or ranking applies. Further, in order for the rating or ranking to be used in any other sales communication, the rating or ranking must be published within three months of the calendar month end to which the rating or ranking applies.
19. Because the evaluation of funds for the Lipper Awards will be based on data aggregated until the end of July in any given year and the results will be published in November of that year, by the time a Fund receives an award in November, section 15.3(4)(f) of NI 81-102 will prohibit it from publishing news of the award altogether.
20. The Exemption Sought is required in order for Lipper Leader ratings and Lipper Awards to be referenced in sales communications relating to the Funds.
21. The Filer submits that the Lipper Awards provide an important tool for investors, as they provide investors with context when evaluating investment choices. The Filer submits that the nature of the Lipper Leader ratings and Lipper Awards alleviates any concern that references to the ratings and awards may be misleading and therefore contrary to section
November 27, 2014 (2014), 37 OSCB 10374
Decisions, Orders and Rulings
15.2(1)(a) of NI 81-102. The Lipper Leader Rating System underlying the Lipper Leader ratings and Lipper Awards ensures an objective, transparent and quantitative measure of performance that is based on the expertise of Lipper in fund analysis.
Decision
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator under the Legislation is that the Exemption Sought is granted to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to a Fund provided that:
1. the sales communication that refers to the Lipper Award and Lipper Leader ratings complies with Part 15 of NI 81-102 other than as set out herein and contains the following disclosure in at least 10 point type:
(a) the name of the category for which the Fund has received the award or rating;
(b) the number of mutual funds in the category for the applicable period;
(c) the name of the ranking entity, i.e., Lipper;
(d) the length of period and the ending date, or, the first day of the period and the ending date on which the Lipper Award or Lipper Leader rating is based;
(e) a statement that Lipper Leader ratings are subject to change every month;
(f) in the case of a Lipper Award, a brief overview of the Lipper Awards;
(g) in the case of a Lipper Leader rating (other than Lipper Leader ratings referenced in connection with a Lipper Award), a brief overview of the Lipper Leader rating;
(h) where Lipper Awards are referenced, the corresponding Lipper Leader rating that the Lipper Award is derived from is presented for each period for which standard performance data is required other than the one year and since inception periods;
(i) where a Lipper Leader rating is referenced, the Lipper Leader ratings are presented for each period for which standard performance data is required other than the one year and since inception periods;
(j) disclosure of the meaning of the Lipper Leader ratings from 1 to 5 (e.g., ranking of 5 indicates a fund is in the top 20% of its category);
(k) reference to Lipper’s website (www.lipperweb.com) for greater detail on the Lipper Awards and Lipper Leader ratings;
2. the Lipper Awards being referenced must not have been awarded more than 365 days before the date of the sales communication; and
3. the Lipper Awards and Lipper Leader ratings being referenced are calculated based on comparisons of performance of investment funds within a specified category established by the CIFSC (or a successor to the CIFSC).
“Vera Nunes” Manager, Investment Funds and Structured Products Ontario Securities Commission
November 27, 2014 (2014), 37 OSCB 10375
Decisions, Orders and Rulings
2.1.8 AlphaPro Management Inc.
Headnote
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions – Existing and future mutual funds managed by the Filer granted relief from paragraphs 15.3(4)(c) and (f) of NI 81-102 Investment Funds to permit references to Lipper Leader ratings and Lipper Awards in sales communications – Relief subject to conditions requiring specified disclosure and the requirement that the Lipper Awards being referenced not have been awarded more than 365 days before the date of the sales communication.
Applicable Legislative Provisions
National Instrument 81-102 Investment Funds, ss. 15.3(4)(c) and (f), 19.1.
November 3, 2014
IN THE MATTER OF THE SECURITIES LEGISLATION OF ONTARIO (the Jurisdiction)
AND
IN THE MATTER OF THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS IN MULTIPLE JURISDICTIONS
AND
IN THE MATTER OF ALPHAPRO MANAGEMENT INC.
DECISION
Background
The principal regulator in the Jurisdiction has received an application from AlphaPro Management Inc. (the Filer) on behalf of existing mutual funds and future mutual funds of which the Filer is or becomes the investment fund manager (or of which an affiliate of the Filer becomes the investment fund manager) and to which National Instrument 81-102 Investment Funds (NI 81- 102) applies (each a Fund and collectively, the Funds) for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) for an exemption from the requirements set out in sections 15.3(4)(c) and 15.3(4)(f) of NI 81-102, which provide that a sales communication must not refer to a performance rating or ranking of a mutual fund or asset allocation service unless:
(i) the rating or ranking is provided for each period for which standard performance data is required to be given, except the period since the inception of the mutual fund
(ii) the rating or ranking is to the same calendar month end that is:
(a) not more than 45 days before the date of the appearance or use of the advertisement in which it is included, and
(b) not more than three months before the date of first publication of any other sales communication in which it is included
(together, the Exemption Sought), to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to the Funds.
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission is the principal regulator for this application, and
November 27, 2014 (2014), 37 OSCB 10376
Decisions, Orders and Rulings
(b) the Filer has provided notice that section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in each of the other provinces and territories of Canada (together with Ontario, the Jurisdictions).
Interpretation
Terms defined in National Instrument 14-101 Definitions, MI 11-102 and NI 81-102 have the same meaning if used in this decision, unless otherwise defined.
Representations
This decision is based on the following facts represented by the Filer:
1. The Filer is the investment fund manager of the Funds and is registered as an investment fund manager in one or more of the Jurisdictions. The head office of the Filer is located in Ontario.
2. Each of the Funds is, or will be, an open-ended mutual fund established under the laws of Canada or a jurisdiction of Canada. The securities of each of the Funds are, or will be, qualified for distribution pursuant to a prospectus that has been, or will be, prepared and filed in accordance with the securities legislation of each applicable Jurisdiction. Each of the Funds is, or will be, a reporting issuer in one or more of the Jurisdictions. Each of the Funds is or will be subject to NI 81-102, including Part 15 of NI 81-102, which governs sales communications.
3. The Filer and the Funds are not in default of the securities legislation in any of the Jurisdictions.
4. The Filer wishes to include in sales communications of the Funds references to Lipper Leader ratings and Lipper Awards (where such Funds have been awarded a Lipper Award).
5. Lipper, Inc. (Lipper) is a company that is not a member of the organization of the Funds. Lipper is part of the Thomson Reuters group of companies, and is a global leader in supplying mutual fund information, analytical tools, and commentary. Lipper's fund data and analysis, fund awards designations and ratings information provide valuable insight to advisors, media and individual investors.
6. One of Lipper’s programs is the Lipper awards program. This program highlights funds that have excelled in delivering consistently strong risk-adjusted performance relative to peers and also recognizes fund families with high average scores for all funds within a particular asset class or overall. Currently the Lipper awards take place in approximately 13 countries.
7. In Canada, the Lipper Awards include the Lipper Fund Awards and Lipper ETF Awards (which will be awarded for the first time in Canada in 2014). For the Lipper Fund Awards, Lipper designates award-winning funds in most individual fund classifications for three, five and ten year periods. For the Lipper ETF Awards, Lipper will designate award- winning funds in a number of individual fund classifications for the three year period, and it is expected that awards for the five and ten year periods will be given in the future.
8. The categories for fund classification used by Lipper for the Lipper Awards in respect of Canadian funds are those maintained by the Canadian Investment Funds Standards Committee (CIFSC) (or a successor to the CIFSC), a Canadian organization that is independent of Lipper. Only those CIFSC groups of ten or more unique funds will claim a Lipper Fund Award, and only those CIFSC groups of five or more unique ETFs (each of whom have a minimum of three years of performance history) will claim a Lipper ETF Award.
9. The Lipper Awards are based on a proprietary rating methodology prepared by Lipper, the Lipper Leader Rating System. The Lipper Leader Rating System is a toolkit that uses investor-centred criteria to deliver a simple, clear description of a fund's success in meeting certain goals, such as preserving capital, lowering expenses or building wealth. Lipper Ratings provide an instant measure of a fund’s success against a specific set of key metrics, and can be useful to investors in identifying funds that meet particular characteristics.
10. In Canada, the Lipper Leader Rating System includes Lipper Leader ratings for Consistent Return (reflecting funds’ historical risk-adjusted returns relative to funds in the same classification), for Total Return (reflecting funds’ historical total return performance relative to funds in the same classification) and for Preservation (reflecting funds’ historical loss avoidance relative to other funds in the same classification). In each case, the categories for fund classification used by Lipper for the Lipper Leader ratings are those maintained by CIFSC (or a successor to the CIFSC). Lipper Leader ratings are measured monthly over 36, 60 and 120 month periods, and an overall rating is also measured, which is an un-weighted average of the previous three periods. The highest 20% of funds in each category are named
November 27, 2014 (2014), 37 OSCB 10377
Decisions, Orders and Rulings
Lipper Leaders for that particular rating and receive a score of 5, the next 20% receive a score of 4, the middle 20% are scored 3, the next 20% are scored 2 and the lowest 20% are scored 1.
11. The Lipper Awards, awarded annually in Canada, are based on the Lipper Ratings for Consistent Return measure, which, as generally described above, is a risk-adjusted mutual fund return performance measure used by Lipper that takes into account both short- and long-term risk-adjusted performance relative to fund classification, together with a measure of a fund’s consistency. In respect of the Lipper Awards for Canada, the Lipper Ratings for Consistent Return are measured over the 36, 60 and 120 month periods ending at the end of July of each year. As noted above, the highest 20% of funds in each classification are named Lipper Leaders for Consistent Return, and the highest Lipper Leader for Consistent Return in each applicable fund classification over these periods (currently, in the case of the Lipper ETF Awards, over the 36 month period only) wins a Lipper Award.
12. When a Fund is awarded a Lipper Award, it may make reference to the award in sales communications subject to the terms of a license agreement with Lipper.
13. The Lipper Leader ratings are performance ratings or rankings under NI 81-102 and Lipper Awards for Funds may be considered to be performance ratings or rankings given that the awards are based on the Lipper Leader ratings as described above. Therefore, references to Lipper Leader ratings and Lipper Awards in sales communications relating to the Funds need to meet the applicable requirements in Part 15 of NI 81-102.
14. Section 15.3(4)(c) of NI 81-102 imposes a “matching” requirement for performance ratings or rankings that are included in sales communications for funds. If a performance rating or ranking is referred to in a sales communication, the performance rating or ranking must be provided for, or “match”, each period for which standard performance data is required to be given for the fund except the period since the inception of the fund (i.e., for one, three, five and ten year periods, as applicable).
15. In Canada and elsewhere, Lipper Leader ratings are calculated only for 36, 60 and 120 month periods and are not calculated for a one year period. This means that a sales communication referencing a Lipper Leader rating cannot comply with the “matching” requirement contained in section 15.3(4)(c) of NI 81-102 because a rating is not available for the one year period. Relief from section 15.3(4)(c) of NI 81-102 is therefore required in order for Funds to reference Lipper Leader ratings in sales communications.
16. In addition, a sales communication referencing the overall Lipper Leader ratings and the Lipper Awards, which are based on the Lipper Leader ratings, must disclose the corresponding Lipper Leader rating for each period for which standard performance data is required to be given. As noted above, because a rating for the one year period is not available for the Lipper Leader ratings, sales communications referencing the overall Lipper Leader ratings or Lipper Awards also cannot comply with the matching requirement contained in section 15.3(4)(c) of NI 81-102.
17. The exemption in section 15.3(4.1) of NI 81-102 for references to overall ratings or rankings of funds cannot be relied upon to reference the overall Lipper Leader ratings or Lipper Awards in sales communications for the Funds because section 15.3(4.1) is available only if a sales communication “otherwise complies” with the requirements of section 15.3(4). As noted above, sales communications referencing the overall Lipper Leader ratings or Lipper Awards cannot comply with the matching requirement in section 15.3(4) because the underlying Lipper Leader ratings are not available for the one year period, rendering the exemption in section 15.3(4.1) unavailable. Relief from section 15.3(4)(c) is therefore required in order for Funds to reference overall Lipper Leader ratings and the Lipper Awards in sales communications.
18. Section 15.3(4)(f) of NI 81-102 imposes certain restrictions on disclosure in sales communications. The section provides that in order for a rating or ranking such as a Lipper Award to be used in an advertisement, the advertisement must be published within 45 days of the calendar month end to which the rating or ranking applies. Further, in order for the rating or ranking to be used in any other sales communication, the rating or ranking must be published within three months of the calendar month end to which the rating or ranking applies.
19. Because the evaluation of funds for the Lipper Awards will be based on data aggregated until the end of July in any given year and the results will be published in November of that year, by the time a Fund receives an award in November, section 15.3(4)(f) of NI 81-102 will prohibit it from publishing news of the award altogether.
20. The Exemption Sought is required in order for Lipper Leader ratings and Lipper Awards to be referenced in sales communications relating to the Funds.
21. The Filer submits that the Lipper Awards provide an important tool for investors, as they provide investors with context when evaluating investment choices. The Filer submits that the nature of the Lipper Leader ratings and Lipper Awards alleviates any concern that references to the ratings and awards may be misleading and therefore contrary to section
November 27, 2014 (2014), 37 OSCB 10378
Decisions, Orders and Rulings
15.2(1)(a) of NI 81-102. The Lipper Leader Rating System underlying the Lipper Leader ratings and Lipper Awards ensures an objective, transparent and quantitative measure of performance that is based on the expertise of Lipper in fund analysis.
Decision
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator under the Legislation is that the Exemption Sought is granted to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to a Fund provided that:
1. the sales communication that refers to the Lipper Award and Lipper Leader ratings complies with Part 15 of NI 81-102 other than as set out herein and contains the following disclosure in at least 10 point type:
(a) the name of the category for which the Fund has received the award or rating;
(b) the number of mutual funds in the category for the applicable period;
(c) the name of the ranking entity, i.e., Lipper;
(d) the length of period and the ending date, or, the first day of the period and the ending date on which the Lipper Award or Lipper Leader rating is based;
(e) a statement that Lipper Leader ratings are subject to change every month;
(f) in the case of a Lipper Award, a brief overview of the Lipper Awards;
(g) in the case of a Lipper Leader rating (other than Lipper Leader ratings referenced in connection with a Lipper Award), a brief overview of the Lipper Leader rating;
(h) where Lipper Awards are referenced, the corresponding Lipper Leader rating that the Lipper Award is derived from is presented for each period for which standard performance data is required other than the one year and since inception periods;
(i) where a Lipper Leader rating is referenced, the Lipper Leader ratings are presented for each period for which standard performance data is required other than the one year and since inception periods;
(j) disclosure of the meaning of the Lipper Leader ratings from 1 to 5 (e.g., ranking of 5 indicates a fund is in the top 20% of its category);
(k) reference to Lipper’s website (www.lipperweb.com) for greater detail on the Lipper Awards and Lipper Leader ratings;
2. the Lipper Awards being referenced must not have been awarded more than 365 days before the date of the sales communication; and
3. the Lipper Awards and Lipper Leader ratings being referenced are calculated based on comparisons of performance of investment funds within a specified category established by the CIFSC (or a successor to the CIFSC).
“Vera Nunes” Manager, Investment Funds and Structured Products Ontario Securities Commission
November 27, 2014 (2014), 37 OSCB 10379
Decisions, Orders and Rulings
2.1.9 Blackrock Asset Management Canada Limited
Headnote
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions – Existing and future mutual funds managed by the Filer granted relief from paragraphs 15.3(4)(c) and (f) of NI 81-102 Investment Funds to permit references to Lipper Leader ratings and Lipper Awards in sales communications – Relief subject to conditions requiring specified disclosure and the requirement that the Lipper Awards being referenced not have been awarded more than 365 days before the date of the sales communication.
Applicable Legislative Provisions
National Instrument 81-102 Investment Funds, ss. 15.3(4)(c) and (f), 19.1.
November 3, 2014
IN THE MATTER OF THE SECURITIES LEGISLATION OF ONTARIO (the Jurisdiction)
AND
IN THE MATTER OF THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS IN MULTIPLE JURISDICTIONS
AND
IN THE MATTER OF BLACKROCK ASSET MANAGEMENT CANADA LIMITED
DECISION
Background
The principal regulator in the Jurisdiction has received an application from Blackrock Asset Management Canada Limited (the Filer) on behalf of existing mutual funds and future mutual funds of which the Filer is or becomes the investment fund manager (or of which an affiliate of the Filer becomes the investment fund manager) and to which National Instrument 81-102 Investment Funds (NI 81-102) applies (each a Fund and collectively, the Funds) for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) for an exemption from the requirements set out in sections 15.3(4)(c) and 15.3(4)(f) of NI 81-102, which provide that a sales communication must not refer to a performance rating or ranking of a mutual fund or asset allocation service unless:
(i) the rating or ranking is provided for each period for which standard performance data is required to be given, except the period since the inception of the mutual fund
(ii) the rating or ranking is to the same calendar month end that is:
(a) not more than 45 days before the date of the appearance or use of the advertisement in which it is included, and
(b) not more than three months before the date of first publication of any other sales communication in which it is included
(together, the Exemption Sought), to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to the Funds.
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission is the principal regulator for this application, and
November 27, 2014 (2014), 37 OSCB 10380
Decisions, Orders and Rulings
(b) the Filer has provided notice that section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in each of the other provinces and territories of Canada (together with Ontario, the Jurisdictions).
Interpretation
Terms defined in National Instrument 14-101 Definitions, MI 11-102 and NI 81-102 have the same meaning if used in this decision, unless otherwise defined.
Representations
This decision is based on the following facts represented by the Filer:
1. The Filer is the investment fund manager of the Funds and is registered as an investment fund manager in one or more of the Jurisdictions. The head office of the Filer is located in Ontario.
2. Each of the Funds is, or will be, an open-ended mutual fund established under the laws of Canada or a jurisdiction of Canada. The securities of each of the Funds are, or will be, qualified for distribution pursuant to a prospectus that has been, or will be, prepared and filed in accordance with the securities legislation of each applicable Jurisdiction. Each of the Funds is, or will be, a reporting issuer in one or more of the Jurisdictions. Each of the Funds is or will be subject to NI 81-102, including Part 15 of NI 81-102, which governs sales communications.
3. The Filer and the Funds are not in default of the securities legislation in any of the Jurisdictions.
4. The Filer wishes to include in sales communications of the Funds references to Lipper Leader ratings and Lipper Awards (where such Funds have been awarded a Lipper Award).
5. Lipper, Inc. (Lipper) is a company that is not a member of the organization of the Funds. Lipper is part of the Thomson Reuters group of companies, and is a global leader in supplying mutual fund information, analytical tools, and commentary. Lipper's fund data and analysis, fund awards designations and ratings information provide valuable insight to advisors, media and individual investors.
6. One of Lipper’s programs is the Lipper awards program. This program highlights funds that have excelled in delivering consistently strong risk-adjusted performance relative to peers and also recognizes fund families with high average scores for all funds within a particular asset class or overall. Currently the Lipper awards take place in approximately 13 countries.
7. In Canada, the Lipper Awards include the Lipper Fund Awards and Lipper ETF Awards (which will be awarded for the first time in Canada in 2014). For the Lipper Fund Awards, Lipper designates award-winning funds in most individual fund classifications for three, five and ten year periods. For the Lipper ETF Awards, Lipper will designate award- winning funds in a number of individual fund classifications for the three year period, and it is expected that awards for the five and ten year periods will be given in the future.
8. The categories for fund classification used by Lipper for the Lipper Awards in respect of Canadian funds are those maintained by the Canadian Investment Funds Standards Committee (CIFSC) (or a successor to the CIFSC), a Canadian organization that is independent of Lipper. Only those CIFSC groups of ten or more unique funds will claim a Lipper Fund Award, and only those CIFSC groups of five or more unique ETFs (each of whom have a minimum of three years of performance history) will claim a Lipper ETF Award.
9. The Lipper Awards are based on a proprietary rating methodology prepared by Lipper, the Lipper Leader Rating System. The Lipper Leader Rating System is a toolkit that uses investor-centred criteria to deliver a simple, clear description of a fund's success in meeting certain goals, such as preserving capital, lowering expenses or building wealth. Lipper Ratings provide an instant measure of a fund’s success against a specific set of key metrics, and can be useful to investors in identifying funds that meet particular characteristics.
10. In Canada, the Lipper Leader Rating System includes Lipper Leader ratings for Consistent Return (reflecting funds’ historical risk-adjusted returns relative to funds in the same classification), for Total Return (reflecting funds’ historical total return performance relative to funds in the same classification) and for Preservation (reflecting funds’ historical loss avoidance relative to other funds in the same classification). In each case, the categories for fund classification used by Lipper for the Lipper Leader ratings are those maintained by CIFSC (or a successor to the CIFSC). Lipper Leader ratings are measured monthly over 36, 60 and 120 month periods, and an overall rating is also measured, which is an un-weighted average of the previous three periods. The highest 20% of funds in each category are named
November 27, 2014 (2014), 37 OSCB 10381
Decisions, Orders and Rulings
Lipper Leaders for that particular rating and receive a score of 5, the next 20% receive a score of 4, the middle 20% are scored 3, the next 20% are scored 2 and the lowest 20% are scored 1.
11. The Lipper Awards, awarded annually in Canada, are based on the Lipper Ratings for Consistent Return measure, which, as generally described above, is a risk-adjusted mutual fund return performance measure used by Lipper that takes into account both short- and long-term risk-adjusted performance relative to fund classification, together with a measure of a fund’s consistency. In respect of the Lipper Awards for Canada, the Lipper Ratings for Consistent Return are measured over the 36, 60 and 120 month periods ending at the end of July of each year. As noted above, the highest 20% of funds in each classification are named Lipper Leaders for Consistent Return, and the highest Lipper Leader for Consistent Return in each applicable fund classification over these periods (currently, in the case of the Lipper ETF Awards, over the 36 month period only) wins a Lipper Award.
12. When a Fund is awarded a Lipper Award, it may make reference to the award in sales communications subject to the terms of a license agreement with Lipper.
13. The Lipper Leader ratings are performance ratings or rankings under NI 81-102 and Lipper Awards for Funds may be considered to be performance ratings or rankings given that the awards are based on the Lipper Leader ratings as described above. Therefore, references to Lipper Leader ratings and Lipper Awards in sales communications relating to the Funds need to meet the applicable requirements in Part 15 of NI 81-102.
14. Section 15.3(4)(c) of NI 81-102 imposes a “matching” requirement for performance ratings or rankings that are included in sales communications for funds. If a performance rating or ranking is referred to in a sales communication, the performance rating or ranking must be provided for, or “match”, each period for which standard performance data is required to be given for the fund except the period since the inception of the fund (i.e., for one, three, five and ten year periods, as applicable).
15. In Canada and elsewhere, Lipper Leader ratings are calculated only for 36, 60 and 120 month periods and are not calculated for a one year period. This means that a sales communication referencing a Lipper Leader rating cannot comply with the “matching” requirement contained in section 15.3(4)(c) of NI 81-102 because a rating is not available for the one year period. Relief from section 15.3(4)(c) of NI 81-102 is therefore required in order for Funds to reference Lipper Leader ratings in sales communications.
16. In addition, a sales communication referencing the overall Lipper Leader ratings and the Lipper Awards, which are based on the Lipper Leader ratings, must disclose the corresponding Lipper Leader rating for each period for which standard performance data is required to be given. As noted above, because a rating for the one year period is not available for the Lipper Leader ratings, sales communications referencing the overall Lipper Leader ratings or Lipper Awards also cannot comply with the matching requirement contained in section 15.3(4)(c) of NI 81-102.
17. The exemption in section 15.3(4.1) of NI 81-102 for references to overall ratings or rankings of funds cannot be relied upon to reference the overall Lipper Leader ratings or Lipper Awards in sales communications for the Funds because section 15.3(4.1) is available only if a sales communication “otherwise complies” with the requirements of section 15.3(4). As noted above, sales communications referencing the overall Lipper Leader ratings or Lipper Awards cannot comply with the matching requirement in section 15.3(4) because the underlying Lipper Leader ratings are not available for the one year period, rendering the exemption in section 15.3(4.1) unavailable. Relief from section 15.3(4)(c) is therefore required in order for Funds to reference overall Lipper Leader ratings and the Lipper Awards in sales communications.
18. Section 15.3(4)(f) of NI 81-102 imposes certain restrictions on disclosure in sales communications. The section provides that in order for a rating or ranking such as a Lipper Award to be used in an advertisement, the advertisement must be published within 45 days of the calendar month end to which the rating or ranking applies. Further, in order for the rating or ranking to be used in any other sales communication, the rating or ranking must be published within three months of the calendar month end to which the rating or ranking applies.
19. Because the evaluation of funds for the Lipper Awards will be based on data aggregated until the end of July in any given year and the results will be published in November of that year, by the time a Fund receives an award in November, section 15.3(4)(f) of NI 81-102 will prohibit it from publishing news of the award altogether.
20. The Exemption Sought is required in order for Lipper Leader ratings and Lipper Awards to be referenced in sales communications relating to the Funds.
21. The Filer submits that the Lipper Awards provide an important tool for investors, as they provide investors with context when evaluating investment choices. The Filer submits that the nature of the Lipper Leader ratings and Lipper Awards alleviates any concern that references to the ratings and awards may be misleading and therefore contrary to section
November 27, 2014 (2014), 37 OSCB 10382
Decisions, Orders and Rulings
15.2(1)(a) of NI 81-102. The Lipper Leader Rating System underlying the Lipper Leader ratings and Lipper Awards ensures an objective, transparent and quantitative measure of performance that is based on the expertise of Lipper in fund analysis.
Decision
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator under the Legislation is that the Exemption Sought is granted to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to a Fund provided that:
1. the sales communication that refers to the Lipper Award and Lipper Leader ratings complies with Part 15 of NI 81-102 other than as set out herein and contains the following disclosure in at least 10 point type:
(a) the name of the category for which the Fund has received the award or rating;
(b) the number of mutual funds in the category for the applicable period;
(c) the name of the ranking entity, i.e., Lipper;
(d) the length of period and the ending date, or, the first day of the period and the ending date on which the Lipper Award or Lipper Leader rating is based;
(e) a statement that Lipper Leader ratings are subject to change every month;
(f) in the case of a Lipper Award, a brief overview of the Lipper Awards;
(g) in the case of a Lipper Leader rating (other than Lipper Leader ratings referenced in connection with a Lipper Award), a brief overview of the Lipper Leader rating;
(h) where Lipper Awards are referenced, the corresponding Lipper Leader rating that the Lipper Award is derived from is presented for each period for which standard performance data is required other than the one year and since inception periods;
(i) where a Lipper Leader rating is referenced, the Lipper Leader ratings are presented for each period for which standard performance data is required other than the one year and since inception periods;
(j) disclosure of the meaning of the Lipper Leader ratings from 1 to 5 (e.g., ranking of 5 indicates a fund is in the top 20% of its category);
(k) reference to Lipper’s website (www.lipperweb.com) for greater detail on the Lipper Awards and Lipper Leader ratings;
2. the Lipper Awards being referenced must not have been awarded more than 365 days before the date of the sales communication; and
3. the Lipper Awards and Lipper Leader ratings being referenced are calculated based on comparisons of performance of investment funds within a specified category established by the CIFSC (or a successor to the CIFSC).
“Vera Nunes” Manager, Investment Funds and Structured Products Ontario Securities Commission
November 27, 2014 (2014), 37 OSCB 10383
Decisions, Orders and Rulings
2.1.10 BMO Asset Management Inc.
Headnote
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions – Existing and future mutual funds managed by the Filer granted relief from paragraphs 15.3(4)(c) and (f) of NI 81-102 Investment Funds to permit references to Lipper Leader ratings and Lipper Awards in sales communications – Relief subject to conditions requiring specified disclosure and the requirement that the Lipper Awards being referenced not have been awarded more than 365 days before the date of the sales communication.
Applicable Legislative Provisions
National Instrument 81-102 Investment Funds, ss. 15.3(4)(c) and (f), 19.1.
November 3, 2014
IN THE MATTER OF THE SECURITIES LEGISLATION OF ONTARIO (the Jurisdiction)
AND
IN THE MATTER OF THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS IN MULTIPLE JURISDICTIONS
AND
IN THE MATTER OF BMO ASSET MANAGEMENT INC.
DECISION
Background
The principal regulator in the Jurisdiction has received an application from BMO Asset Management Inc. (the Filer) on behalf of existing mutual funds and future mutual funds of which the Filer is or becomes the investment fund manager (or of which an affiliate of the Filer becomes the investment fund manager) and to which National Instrument 81-102 Investment Funds (NI 81- 102) applies (each a Fund and collectively, the Funds) for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) for an exemption from the requirements set out in sections 15.3(4)(c) and 15.3(4)(f) of NI 81-102, which provide that a sales communication must not refer to a performance rating or ranking of a mutual fund or asset allocation service unless:
(i) the rating or ranking is provided for each period for which standard performance data is required to be given, except the period since the inception of the mutual fund
(ii) the rating or ranking is to the same calendar month end that is:
(a) not more than 45 days before the date of the appearance or use of the advertisement in which it is included, and
(b) not more than three months before the date of first publication of any other sales communication in which it is included
(together, the Exemption Sought), to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to the Funds.
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission is the principal regulator for this application, and
November 27, 2014 (2014), 37 OSCB 10384
Decisions, Orders and Rulings
(b) the Filer has provided notice that section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in each of the other provinces and territories of Canada (together with Ontario, the Jurisdictions).
Interpretation
Terms defined in National Instrument 14-101 Definitions, MI 11-102 and NI 81-102 have the same meaning if used in this decision, unless otherwise defined.
Representations
This decision is based on the following facts represented by the Filer:
1. The Filer is the investment fund manager of the Funds and is registered as an investment fund manager in one or more of the Jurisdictions. The head office of the Filer is located in Ontario.
2. Each of the Funds is, or will be, an open-ended mutual fund established under the laws of Canada or a jurisdiction of Canada. The securities of each of the Funds are, or will be, qualified for distribution pursuant to a prospectus that has been, or will be, prepared and filed in accordance with the securities legislation of each applicable Jurisdiction. Each of the Funds is, or will be, a reporting issuer in one or more of the Jurisdictions. Each of the Funds is or will be subject to NI 81-102, including Part 15 of NI 81-102, which governs sales communications.
3. The Filer and the Funds are not in default of the securities legislation in any of the Jurisdictions.
4. The Filer wishes to include in sales communications of the Funds references to Lipper Leader ratings and Lipper Awards (where such Funds have been awarded a Lipper Award).
5. Lipper, Inc. (Lipper) is a company that is not a member of the organization of the Funds. Lipper is part of the Thomson Reuters group of companies, and is a global leader in supplying mutual fund information, analytical tools, and commentary. Lipper's fund data and analysis, fund awards designations and ratings information provide valuable insight to advisors, media and individual investors.
6. One of Lipper’s programs is the Lipper awards program. This program highlights funds that have excelled in delivering consistently strong risk-adjusted performance relative to peers and also recognizes fund families with high average scores for all funds within a particular asset class or overall. Currently the Lipper awards take place in approximately 13 countries.
7. In Canada, the Lipper Awards include the Lipper Fund Awards and Lipper ETF Awards (which will be awarded for the first time in Canada in 2014). For the Lipper Fund Awards, Lipper designates award-winning funds in most individual fund classifications for three, five and ten year periods. For the Lipper ETF Awards, Lipper will designate award- winning funds in a number of individual fund classifications for the three year period, and it is expected that awards for the five and ten year periods will be given in the future.
8. The categories for fund classification used by Lipper for the Lipper Awards in respect of Canadian funds are those maintained by the Canadian Investment Funds Standards Committee (CIFSC) (or a successor to the CIFSC), a Canadian organization that is independent of Lipper. Only those CIFSC groups of ten or more unique funds will claim a Lipper Fund Award, and only those CIFSC groups of five or more unique ETFs (each of whom have a minimum of three years of performance history) will claim a Lipper ETF Award.
9. The Lipper Awards are based on a proprietary rating methodology prepared by Lipper, the Lipper Leader Rating System. The Lipper Leader Rating System is a toolkit that uses investor-centred criteria to deliver a simple, clear description of a fund's success in meeting certain goals, such as preserving capital, lowering expenses or building wealth. Lipper Ratings provide an instant measure of a fund’s success against a specific set of key metrics, and can be useful to investors in identifying funds that meet particular characteristics.
10. In Canada, the Lipper Leader Rating System includes Lipper Leader ratings for Consistent Return (reflecting funds’ historical risk-adjusted returns relative to funds in the same classification), for Total Return (reflecting funds’ historical total return performance relative to funds in the same classification) and for Preservation (reflecting funds’ historical loss avoidance relative to other funds in the same classification). In each case, the categories for fund classification used by Lipper for the Lipper Leader ratings are those maintained by CIFSC (or a successor to the CIFSC). Lipper Leader ratings are measured monthly over 36, 60 and 120 month periods, and an overall rating is also measured, which is an un-weighted average of the previous three periods. The highest 20% of funds in each category are named
November 27, 2014 (2014), 37 OSCB 10385
Decisions, Orders and Rulings
Lipper Leaders for that particular rating and receive a score of 5, the next 20% receive a score of 4, the middle 20% are scored 3, the next 20% are scored 2 and the lowest 20% are scored 1.
11. The Lipper Awards, awarded annually in Canada, are based on the Lipper Ratings for Consistent Return measure, which, as generally described above, is a risk-adjusted mutual fund return performance measure used by Lipper that takes into account both short- and long-term risk-adjusted performance relative to fund classification, together with a measure of a fund’s consistency. In respect of the Lipper Awards for Canada, the Lipper Ratings for Consistent Return are measured over the 36, 60 and 120 month periods ending at the end of July of each year. As noted above, the highest 20% of funds in each classification are named Lipper Leaders for Consistent Return, and the highest Lipper Leader for Consistent Return in each applicable fund classification over these periods (currently, in the case of the Lipper ETF Awards, over the 36 month period only) wins a Lipper Award.
12. When a Fund is awarded a Lipper Award, it may make reference to the award in sales communications subject to the terms of a license agreement with Lipper.
13. The Lipper Leader ratings are performance ratings or rankings under NI 81-102 and Lipper Awards for Funds may be considered to be performance ratings or rankings given that the awards are based on the Lipper Leader ratings as described above. Therefore, references to Lipper Leader ratings and Lipper Awards in sales communications relating to the Funds need to meet the applicable requirements in Part 15 of NI 81-102.
14. Section 15.3(4)(c) of NI 81-102 imposes a “matching” requirement for performance ratings or rankings that are included in sales communications for funds. If a performance rating or ranking is referred to in a sales communication, the performance rating or ranking must be provided for, or “match”, each period for which standard performance data is required to be given for the fund except the period since the inception of the fund (i.e., for one, three, five and ten year periods, as applicable).
15. In Canada and elsewhere, Lipper Leader ratings are calculated only for 36, 60 and 120 month periods and are not calculated for a one year period. This means that a sales communication referencing a Lipper Leader rating cannot comply with the “matching” requirement contained in section 15.3(4)(c) of NI 81-102 because a rating is not available for the one year period. Relief from section 15.3(4)(c) of NI 81-102 is therefore required in order for Funds to reference Lipper Leader ratings in sales communications.
16. In addition, a sales communication referencing the overall Lipper Leader ratings and the Lipper Awards, which are based on the Lipper Leader ratings, must disclose the corresponding Lipper Leader rating for each period for which standard performance data is required to be given. As noted above, because a rating for the one year period is not available for the Lipper Leader ratings, sales communications referencing the overall Lipper Leader ratings or Lipper Awards also cannot comply with the matching requirement contained in section 15.3(4)(c) of NI 81-102.
17. The exemption in section 15.3(4.1) of NI 81-102 for references to overall ratings or rankings of funds cannot be relied upon to reference the overall Lipper Leader ratings or Lipper Awards in sales communications for the Funds because section 15.3(4.1) is available only if a sales communication “otherwise complies” with the requirements of section 15.3(4). As noted above, sales communications referencing the overall Lipper Leader ratings or Lipper Awards cannot comply with the matching requirement in section 15.3(4) because the underlying Lipper Leader ratings are not available for the one year period, rendering the exemption in section 15.3(4.1) unavailable. Relief from section 15.3(4)(c) is therefore required in order for Funds to reference overall Lipper Leader ratings and the Lipper Awards in sales communications.
18. Section 15.3(4)(f) of NI 81-102 imposes certain restrictions on disclosure in sales communications. The section provides that in order for a rating or ranking such as a Lipper Award to be used in an advertisement, the advertisement must be published within 45 days of the calendar month end to which the rating or ranking applies. Further, in order for the rating or ranking to be used in any other sales communication, the rating or ranking must be published within three months of the calendar month end to which the rating or ranking applies.
19. Because the evaluation of funds for the Lipper Awards will be based on data aggregated until the end of July in any given year and the results will be published in November of that year, by the time a Fund receives an award in November, section 15.3(4)(f) of NI 81-102 will prohibit it from publishing news of the award altogether.
20. The Exemption Sought is required in order for Lipper Leader ratings and Lipper Awards to be referenced in sales communications relating to the Funds.
21. The Filer submits that the Lipper Awards provide an important tool for investors, as they provide investors with context when evaluating investment choices. The Filer submits that the nature of the Lipper Leader ratings and Lipper Awards alleviates any concern that references to the ratings and awards may be misleading and therefore contrary to section
November 27, 2014 (2014), 37 OSCB 10386
Decisions, Orders and Rulings
15.2(1)(a) of NI 81-102. The Lipper Leader Rating System underlying the Lipper Leader ratings and Lipper Awards ensures an objective, transparent and quantitative measure of performance that is based on the expertise of Lipper in fund analysis.
Decision
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator under the Legislation is that the Exemption Sought is granted to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to a Fund provided that:
1. the sales communication that refers to the Lipper Award and Lipper Leader ratings complies with Part 15 of NI 81-102 other than as set out herein and contains the following disclosure in at least 10 point type:
(a) the name of the category for which the Fund has received the award or rating;
(b) the number of mutual funds in the category for the applicable period;
(c) the name of the ranking entity, i.e., Lipper;
(d) the length of period and the ending date, or, the first day of the period and the ending date on which the Lipper Award or Lipper Leader rating is based;
(e) a statement that Lipper Leader ratings are subject to change every month;
(f) in the case of a Lipper Award, a brief overview of the Lipper Awards;
(g) in the case of a Lipper Leader rating (other than Lipper Leader ratings referenced in connection with a Lipper Award), a brief overview of the Lipper Leader rating;
(h) where Lipper Awards are referenced, the corresponding Lipper Leader rating that the Lipper Award is derived from is presented for each period for which standard performance data is required other than the one year and since inception periods;
(i) where a Lipper Leader rating is referenced, the Lipper Leader ratings are presented for each period for which standard performance data is required other than the one year and since inception periods;
(j) disclosure of the meaning of the Lipper Leader ratings from 1 to 5 (e.g., ranking of 5 indicates a fund is in the top 20% of its category);
(k) reference to Lipper’s website (www.lipperweb.com) for greater detail on the Lipper Awards and Lipper Leader ratings;
2. the Lipper Awards being referenced must not have been awarded more than 365 days before the date of the sales communication; and
3. the Lipper Awards and Lipper Leader ratings being referenced are calculated based on comparisons of performance of investment funds within a specified category established by the CIFSC (or a successor to the CIFSC).
“Vera Nunes” Manager, Investment Funds and Structured Products Ontario Securities Commission
November 27, 2014 (2014), 37 OSCB 10387
Decisions, Orders and Rulings
2.1.11 BMO Harris Investment Management Inc.
Headnote
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions – Existing and future mutual funds managed by the Filer granted relief from paragraphs 15.3(4)(c) and (f) of NI 81-102 Investment Funds to permit references to Lipper Leader ratings and Lipper Awards in sales communications – Relief subject to conditions requiring specified disclosure and the requirement that the Lipper Awards being referenced not have been awarded more than 365 days before the date of the sales communication.
Applicable Legislative Provisions
National Instrument 81-102 Investment Funds, ss. 15.3(4)(c) and (f), and 19.1.
November 3, 2014
IN THE MATTER OF THE SECURITIES LEGISLATION OF ONTARIO (the Jurisdiction)
AND
IN THE MATTER OF THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS IN MULTIPLE JURISDICTIONS
AND
IN THE MATTER OF BMO HARRIS INVESTMENT MANAGEMENT INC.
DECISION
Background
The principal regulator in the Jurisdiction has received an application from BMO Harris Investment Management Inc. (the Filer) on behalf of existing mutual funds and future mutual funds of which the Filer is or becomes the investment fund manager (or of which an affiliate of the Filer becomes the investment fund manager) and to which National Instrument 81-102 Investment Funds (NI 81-102) applies (each a Fund and collectively, the Funds) for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) for an exemption from the requirements set out in sections 15.3(4)(c) and 15.3(4)(f) of NI 81-102, which provide that a sales communication must not refer to a performance rating or ranking of a mutual fund or asset allocation service unless:
(i) the rating or ranking is provided for each period for which standard performance data is required to be given, except the period since the inception of the mutual fund
(ii) the rating or ranking is to the same calendar month end that is:
(a) not more than 45 days before the date of the appearance or use of the advertisement in which it is included, and
(b) not more than three months before the date of first publication of any other sales communication in which it is included
(together, the Exemption Sought), to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to the Funds.
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission is the principal regulator for this application, and
November 27, 2014 (2014), 37 OSCB 10388
Decisions, Orders and Rulings
(b) the Filer has provided notice that section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in each of the other provinces and territories of Canada (together with Ontario, the Jurisdictions).
Interpretation
Terms defined in National Instrument 14-101 Definitions, MI 11-102 and NI 81-102 have the same meaning if used in this decision, unless otherwise defined.
Representations
This decision is based on the following facts represented by the Filer:
1. The Filer is the investment fund manager of the Funds and is registered as an investment fund manager in one or more of the Jurisdictions. The head office of the Filer is located in Ontario.
2. Each of the Funds is, or will be, an open-ended mutual fund established under the laws of Canada or a jurisdiction of Canada. The securities of each of the Funds are, or will be, qualified for distribution pursuant to a prospectus that has been, or will be, prepared and filed in accordance with the securities legislation of each applicable Jurisdiction. Each of the Funds is, or will be, a reporting issuer in one or more of the Jurisdictions. Each of the Funds is or will be subject to NI 81-102, including Part 15 of NI 81-102, which governs sales communications.
3. The Filer and the Funds are not in default of the securities legislation in any of the Jurisdictions.
4. The Filer wishes to include in sales communications of the Funds references to Lipper Leader ratings and Lipper Awards (where such Funds have been awarded a Lipper Award).
5. Lipper, Inc. (Lipper) is a company that is not a member of the organization of the Funds. Lipper is part of the Thomson Reuters group of companies, and is a global leader in supplying mutual fund information, analytical tools, and commentary. Lipper's fund data and analysis, fund awards designations and ratings information provide valuable insight to advisors, media and individual investors.
6. One of Lipper’s programs is the Lipper awards program. This program highlights funds that have excelled in delivering consistently strong risk-adjusted performance relative to peers and also recognizes fund families with high average scores for all funds within a particular asset class or overall. Currently the Lipper awards take place in approximately 13 countries.
7. In Canada, the Lipper Awards include the Lipper Fund Awards and Lipper ETF Awards (which will be awarded for the first time in Canada in 2014). For the Lipper Fund Awards, Lipper designates award-winning funds in most individual fund classifications for three, five and ten year periods. For the Lipper ETF Awards, Lipper will designate award- winning funds in a number of individual fund classifications for the three year period, and it is expected that awards for the five and ten year periods will be given in the future.
8. The categories for fund classification used by Lipper for the Lipper Awards in respect of Canadian funds are those maintained by the Canadian Investment Funds Standards Committee (CIFSC) (or a successor to the CIFSC), a Canadian organization that is independent of Lipper. Only those CIFSC groups of ten or more unique funds will claim a Lipper Fund Award, and only those CIFSC groups of five or more unique ETFs (each of whom have a minimum of three years of performance history) will claim a Lipper ETF Award.
9. The Lipper Awards are based on a proprietary rating methodology prepared by Lipper, the Lipper Leader Rating System. The Lipper Leader Rating System is a toolkit that uses investor-centred criteria to deliver a simple, clear description of a fund's success in meeting certain goals, such as preserving capital, lowering expenses or building wealth. Lipper Ratings provide an instant measure of a fund’s success against a specific set of key metrics, and can be useful to investors in identifying funds that meet particular characteristics.
10. In Canada, the Lipper Leader Rating System includes Lipper Leader ratings for Consistent Return (reflecting funds’ historical risk-adjusted returns relative to funds in the same classification), for Total Return (reflecting funds’ historical total return performance relative to funds in the same classification) and for Preservation (reflecting funds’ historical loss avoidance relative to other funds in the same classification). In each case, the categories for fund classification used by Lipper for the Lipper Leader ratings are those maintained by CIFSC (or a successor to the CIFSC). Lipper Leader ratings are measured monthly over 36, 60 and 120 month periods, and an overall rating is also measured, which is an un-weighted average of the previous three periods. The highest 20% of funds in each category are named
November 27, 2014 (2014), 37 OSCB 10389
Decisions, Orders and Rulings
Lipper Leaders for that particular rating and receive a score of 5, the next 20% receive a score of 4, the middle 20% are scored 3, the next 20% are scored 2 and the lowest 20% are scored 1.
11. The Lipper Awards, awarded annually in Canada, are based on the Lipper Ratings for Consistent Return measure, which, as generally described above, is a risk-adjusted mutual fund return performance measure used by Lipper that takes into account both short- and long-term risk-adjusted performance relative to fund classification, together with a measure of a fund’s consistency. In respect of the Lipper Awards for Canada, the Lipper Ratings for Consistent Return are measured over the 36, 60 and 120 month periods ending at the end of July of each year. As noted above, the highest 20% of funds in each classification are named Lipper Leaders for Consistent Return, and the highest Lipper Leader for Consistent Return in each applicable fund classification over these periods (currently, in the case of the Lipper ETF Awards, over the 36 month period only) wins a Lipper Award.
12. When a Fund is awarded a Lipper Award, it may make reference to the award in sales communications subject to the terms of a license agreement with Lipper.
13. The Lipper Leader ratings are performance ratings or rankings under NI 81-102 and Lipper Awards for Funds may be considered to be performance ratings or rankings given that the awards are based on the Lipper Leader ratings as described above. Therefore, references to Lipper Leader ratings and Lipper Awards in sales communications relating to the Funds need to meet the applicable requirements in Part 15 of NI 81-102.
14. Section 15.3(4)(c) of NI 81-102 imposes a “matching” requirement for performance ratings or rankings that are included in sales communications for funds. If a performance rating or ranking is referred to in a sales communication, the performance rating or ranking must be provided for, or “match”, each period for which standard performance data is required to be given for the fund except the period since the inception of the fund (i.e., for one, three, five and ten year periods, as applicable).
15. In Canada and elsewhere, Lipper Leader ratings are calculated only for 36, 60 and 120 month periods and are not calculated for a one year period. This means that a sales communication referencing a Lipper Leader rating cannot comply with the “matching” requirement contained in section 15.3(4)(c) of NI 81-102 because a rating is not available for the one year period. Relief from section 15.3(4)(c) of NI 81-102 is therefore required in order for Funds to reference Lipper Leader ratings in sales communications.
16. In addition, a sales communication referencing the overall Lipper Leader ratings and the Lipper Awards, which are based on the Lipper Leader ratings, must disclose the corresponding Lipper Leader rating for each period for which standard performance data is required to be given. As noted above, because a rating for the one year period is not available for the Lipper Leader ratings, sales communications referencing the overall Lipper Leader ratings or Lipper Awards also cannot comply with the matching requirement contained in section 15.3(4)(c) of NI 81-102.
17. The exemption in section 15.3(4.1) of NI 81-102 for references to overall ratings or rankings of funds cannot be relied upon to reference the overall Lipper Leader ratings or Lipper Awards in sales communications for the Funds because section 15.3(4.1) is available only if a sales communication “otherwise complies” with the requirements of section 15.3(4). As noted above, sales communications referencing the overall Lipper Leader ratings or Lipper Awards cannot comply with the matching requirement in section 15.3(4) because the underlying Lipper Leader ratings are not available for the one year period, rendering the exemption in section 15.3(4.1) unavailable. Relief from section 15.3(4)(c) is therefore required in order for Funds to reference overall Lipper Leader ratings and the Lipper Awards in sales communications.
18. Section 15.3(4)(f) of NI 81-102 imposes certain restrictions on disclosure in sales communications. The section provides that in order for a rating or ranking such as a Lipper Award to be used in an advertisement, the advertisement must be published within 45 days of the calendar month end to which the rating or ranking applies. Further, in order for the rating or ranking to be used in any other sales communication, the rating or ranking must be published within three months of the calendar month end to which the rating or ranking applies.
19. Because the evaluation of funds for the Lipper Awards will be based on data aggregated until the end of July in any given year and the results will be published in November of that year, by the time a Fund receives an award in November, section 15.3(4)(f) of NI 81-102 will prohibit it from publishing news of the award altogether.
20. The Exemption Sought is required in order for Lipper Leader ratings and Lipper Awards to be referenced in sales communications relating to the Funds.
21. The Filer submits that the Lipper Awards provide an important tool for investors, as they provide investors with context when evaluating investment choices. The Filer submits that the nature of the Lipper Leader ratings and Lipper Awards alleviates any concern that references to the ratings and awards may be misleading and therefore contrary to section
November 27, 2014 (2014), 37 OSCB 10390
Decisions, Orders and Rulings
15.2(1)(a) of NI 81-102. The Lipper Leader Rating System underlying the Lipper Leader ratings and Lipper Awards ensures an objective, transparent and quantitative measure of performance that is based on the expertise of Lipper in fund analysis.
Decision
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator under the Legislation is that the Exemption Sought is granted to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to a Fund provided that:
1. the sales communication that refers to the Lipper Award and Lipper Leader ratings complies with Part 15 of NI 81-102 other than as set out herein and contains the following disclosure in at least 10 point type:
(a) the name of the category for which the Fund has received the award or rating;
(b) the number of mutual funds in the category for the applicable period;
(c) the name of the ranking entity, i.e., Lipper;
(d) the length of period and the ending date, or, the first day of the period and the ending date on which the Lipper Award or Lipper Leader rating is based;
(e) a statement that Lipper Leader ratings are subject to change every month;
(f) in the case of a Lipper Award, a brief overview of the Lipper Awards;
(g) in the case of a Lipper Leader rating (other than Lipper Leader ratings referenced in connection with a Lipper Award), a brief overview of the Lipper Leader rating;
(h) where Lipper Awards are referenced, the corresponding Lipper Leader rating that the Lipper Award is derived from is presented for each period for which standard performance data is required other than the one year and since inception periods;
(i) where a Lipper Leader rating is referenced, the Lipper Leader ratings are presented for each period for which standard performance data is required other than the one year and since inception periods;
(j) disclosure of the meaning of the Lipper Leader ratings from 1 to 5 (e.g., ranking of 5 indicates a fund is in the top 20% of its category);
(k) reference to Lipper’s website (www.lipperweb.com) for greater detail on the Lipper Awards and Lipper Leader ratings;
2. the Lipper Awards being referenced must not have been awarded more than 365 days before the date of the sales communication; and
3. the Lipper Awards and Lipper Leader ratings being referenced are calculated based on comparisons of performance of investment funds within a specified category established by the CIFSC (or a successor to the CIFSC).
“Vera Nunes” Manager, Investment Funds and Structured Products Ontario Securities Commission
November 27, 2014 (2014), 37 OSCB 10391
Decisions, Orders and Rulings
2.1.12 BMO Investments Inc.
Headnote
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions – Existing and future mutual funds managed by the Filer granted relief from paragraphs 15.3(4)(c) and (f) of NI 81-102 Investment Funds to permit references to Lipper Leader ratings and Lipper Awards in sales communications – Relief subject to conditions requiring specified disclosure and the requirement that the Lipper Awards being referenced not have been awarded more than 365 days before the date of the sales communication.
Applicable Legislative Provisions
National Instrument 81-102 Investment Funds, ss. 15.3(4)(c) and (f), 19.1.
November 3, 2014
IN THE MATTER OF THE SECURITIES LEGISLATION OF ONTARIO (the Jurisdiction)
AND
IN THE MATTER OF THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS IN MULTIPLE JURISDICTIONS
AND
IN THE MATTER OF BMO INVESTMENTS INC.
DECISION
Background
The principal regulator in the Jurisdiction has received an application from BMO Investments Inc. (the Filer) on behalf of existing mutual funds and future mutual funds of which the Filer is or becomes the investment fund manager (or of which an affiliate of the Filer becomes the investment fund manager) and to which National Instrument 81-102 Investment Funds (NI 81-102) applies (each a Fund and collectively, the Funds) for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) for an exemption from the requirements set out in sections 15.3(4)(c) and 15.3(4)(f) of NI 81-102, which provide that a sales communication must not refer to a performance rating or ranking of a mutual fund or asset allocation service unless:
(i) the rating or ranking is provided for each period for which standard performance data is required to be given, except the period since the inception of the mutual fund
(ii) the rating or ranking is to the same calendar month end that is:
(a) not more than 45 days before the date of the appearance or use of the advertisement in which it is included, and
(b) not more than three months before the date of first publication of any other sales communication in which it is included
(together, the Exemption Sought), to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to the Funds.
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission is the principal regulator for this application, and
November 27, 2014 (2014), 37 OSCB 10392
Decisions, Orders and Rulings
(b) the Filer has provided notice that section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in each of the other provinces and territories of Canada (together with Ontario, the Jurisdictions).
Interpretation
Terms defined in National Instrument 14-101 Definitions, MI 11-102 and NI 81-102 have the same meaning if used in this decision, unless otherwise defined.
Representations
This decision is based on the following facts represented by the Filer:
1. The Filer is the investment fund manager of the Funds and is registered as an investment fund manager in one or more of the Jurisdictions. The head office of the Filer is located in Ontario.
2. Each of the Funds is, or will be, an open-ended mutual fund established under the laws of Canada or a jurisdiction of Canada. The securities of each of the Funds are, or will be, qualified for distribution pursuant to a prospectus that has been, or will be, prepared and filed in accordance with the securities legislation of each applicable Jurisdiction. Each of the Funds is, or will be, a reporting issuer in one or more of the Jurisdictions. Each of the Funds is or will be subject to NI 81-102, including Part 15 of NI 81-102, which governs sales communications.
3. The Filer and the Funds are not in default of the securities legislation in any of the Jurisdictions.
4. The Filer wishes to include in sales communications of the Funds references to Lipper Leader ratings and Lipper Awards (where such Funds have been awarded a Lipper Award).
5. Lipper, Inc. (Lipper) is a company that is not a member of the organization of the Funds. Lipper is part of the Thomson Reuters group of companies, and is a global leader in supplying mutual fund information, analytical tools, and commentary. Lipper's fund data and analysis, fund awards designations and ratings information provide valuable insight to advisors, media and individual investors.
6. One of Lipper’s programs is the Lipper awards program. This program highlights funds that have excelled in delivering consistently strong risk-adjusted performance relative to peers and also recognizes fund families with high average scores for all funds within a particular asset class or overall. Currently the Lipper awards take place in approximately 13 countries.
7. In Canada, the Lipper Awards include the Lipper Fund Awards and Lipper ETF Awards (which will be awarded for the first time in Canada in 2014). For the Lipper Fund Awards, Lipper designates award-winning funds in most individual fund classifications for three, five and ten year periods. For the Lipper ETF Awards, Lipper will designate award- winning funds in a number of individual fund classifications for the three year period, and it is expected that awards for the five and ten year periods will be given in the future.
8. The categories for fund classification used by Lipper for the Lipper Awards in respect of Canadian funds are those maintained by the Canadian Investment Funds Standards Committee (CIFSC) (or a successor to the CIFSC), a Canadian organization that is independent of Lipper. Only those CIFSC groups of ten or more unique funds will claim a Lipper Fund Award, and only those CIFSC groups of five or more unique ETFs (each of whom have a minimum of three years of performance history) will claim a Lipper ETF Award.
9. The Lipper Awards are based on a proprietary rating methodology prepared by Lipper, the Lipper Leader Rating System. The Lipper Leader Rating System is a toolkit that uses investor-centred criteria to deliver a simple, clear description of a fund's success in meeting certain goals, such as preserving capital, lowering expenses or building wealth. Lipper Ratings provide an instant measure of a fund’s success against a specific set of key metrics, and can be useful to investors in identifying funds that meet particular characteristics.
10. In Canada, the Lipper Leader Rating System includes Lipper Leader ratings for Consistent Return (reflecting funds’ historical risk-adjusted returns relative to funds in the same classification), for Total Return (reflecting funds’ historical total return performance relative to funds in the same classification) and for Preservation (reflecting funds’ historical loss avoidance relative to other funds in the same classification). In each case, the categories for fund classification used by Lipper for the Lipper Leader ratings are those maintained by CIFSC (or a successor to the CIFSC). Lipper Leader ratings are measured monthly over 36, 60 and 120 month periods, and an overall rating is also measured, which is an un-weighted average of the previous three periods. The highest 20% of funds in each category are named
November 27, 2014 (2014), 37 OSCB 10393
Decisions, Orders and Rulings
Lipper Leaders for that particular rating and receive a score of 5, the next 20% receive a score of 4, the middle 20% are scored 3, the next 20% are scored 2 and the lowest 20% are scored 1.
11. The Lipper Awards, awarded annually in Canada, are based on the Lipper Ratings for Consistent Return measure, which, as generally described above, is a risk-adjusted mutual fund return performance measure used by Lipper that takes into account both short- and long-term risk-adjusted performance relative to fund classification, together with a measure of a fund’s consistency. In respect of the Lipper Awards for Canada, the Lipper Ratings for Consistent Return are measured over the 36, 60 and 120 month periods ending at the end of July of each year. As noted above, the highest 20% of funds in each classification are named Lipper Leaders for Consistent Return, and the highest Lipper Leader for Consistent Return in each applicable fund classification over these periods (currently, in the case of the Lipper ETF Awards, over the 36 month period only) wins a Lipper Award.
12. When a Fund is awarded a Lipper Award, it may make reference to the award in sales communications subject to the terms of a license agreement with Lipper.
13. The Lipper Leader ratings are performance ratings or rankings under NI 81-102 and Lipper Awards for Funds may be considered to be performance ratings or rankings given that the awards are based on the Lipper Leader ratings as described above. Therefore, references to Lipper Leader ratings and Lipper Awards in sales communications relating to the Funds need to meet the applicable requirements in Part 15 of NI 81-102.
14. Section 15.3(4)(c) of NI 81-102 imposes a “matching” requirement for performance ratings or rankings that are included in sales communications for funds. If a performance rating or ranking is referred to in a sales communication, the performance rating or ranking must be provided for, or “match”, each period for which standard performance data is required to be given for the fund except the period since the inception of the fund (i.e., for one, three, five and ten year periods, as applicable).
15. In Canada and elsewhere, Lipper Leader ratings are calculated only for 36, 60 and 120 month periods and are not calculated for a one year period. This means that a sales communication referencing a Lipper Leader rating cannot comply with the “matching” requirement contained in section 15.3(4)(c) of NI 81-102 because a rating is not available for the one year period. Relief from section 15.3(4)(c) of NI 81-102 is therefore required in order for Funds to reference Lipper Leader ratings in sales communications.
16. In addition, a sales communication referencing the overall Lipper Leader ratings and the Lipper Awards, which are based on the Lipper Leader ratings, must disclose the corresponding Lipper Leader rating for each period for which standard performance data is required to be given. As noted above, because a rating for the one year period is not available for the Lipper Leader ratings, sales communications referencing the overall Lipper Leader ratings or Lipper Awards also cannot comply with the matching requirement contained in section 15.3(4)(c) of NI 81-102.
17. The exemption in section 15.3(4.1) of NI 81-102 for references to overall ratings or rankings of funds cannot be relied upon to reference the overall Lipper Leader ratings or Lipper Awards in sales communications for the Funds because section 15.3(4.1) is available only if a sales communication “otherwise complies” with the requirements of section 15.3(4). As noted above, sales communications referencing the overall Lipper Leader ratings or Lipper Awards cannot comply with the matching requirement in section 15.3(4) because the underlying Lipper Leader ratings are not available for the one year period, rendering the exemption in section 15.3(4.1) unavailable. Relief from section 15.3(4)(c) is therefore required in order for Funds to reference overall Lipper Leader ratings and the Lipper Awards in sales communications.
18. Section 15.3(4)(f) of NI 81-102 imposes certain restrictions on disclosure in sales communications. The section provides that in order for a rating or ranking such as a Lipper Award to be used in an advertisement, the advertisement must be published within 45 days of the calendar month end to which the rating or ranking applies. Further, in order for the rating or ranking to be used in any other sales communication, the rating or ranking must be published within three months of the calendar month end to which the rating or ranking applies.
19. Because the evaluation of funds for the Lipper Awards will be based on data aggregated until the end of July in any given year and the results will be published in November of that year, by the time a Fund receives an award in November, section 15.3(4)(f) of NI 81-102 will prohibit it from publishing news of the award altogether.
20. The Exemption Sought is required in order for Lipper Leader ratings and Lipper Awards to be referenced in sales communications relating to the Funds.
21. The Filer submits that the Lipper Awards provide an important tool for investors, as they provide investors with context when evaluating investment choices. The Filer submits that the nature of the Lipper Leader ratings and Lipper Awards alleviates any concern that references to the ratings and awards may be misleading and therefore contrary to section
November 27, 2014 (2014), 37 OSCB 10394
Decisions, Orders and Rulings
15.2(1)(a) of NI 81-102. The Lipper Leader Rating System underlying the Lipper Leader ratings and Lipper Awards ensures an objective, transparent and quantitative measure of performance that is based on the expertise of Lipper in fund analysis.
Decision
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator under the Legislation is that the Exemption Sought is granted to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to a Fund provided that:
1. the sales communication that refers to the Lipper Award and Lipper Leader ratings complies with Part 15 of NI 81-102 other than as set out herein and contains the following disclosure in at least 10 point type:
(a) the name of the category for which the Fund has received the award or rating;
(b) the number of mutual funds in the category for the applicable period;
(c) the name of the ranking entity, i.e., Lipper;
(d) the length of period and the ending date, or, the first day of the period and the ending date on which the Lipper Award or Lipper Leader rating is based;
(e) a statement that Lipper Leader ratings are subject to change every month;
(f) in the case of a Lipper Award, a brief overview of the Lipper Awards;
(g) in the case of a Lipper Leader rating (other than Lipper Leader ratings referenced in connection with a Lipper Award), a brief overview of the Lipper Leader rating;
(h) where Lipper Awards are referenced, the corresponding Lipper Leader rating that the Lipper Award is derived from is presented for each period for which standard performance data is required other than the one year and since inception periods;
(i) where a Lipper Leader rating is referenced, the Lipper Leader ratings are presented for each period for which standard performance data is required other than the one year and since inception periods;
(j) disclosure of the meaning of the Lipper Leader ratings from 1 to 5 (e.g., ranking of 5 indicates a fund is in the top 20% of its category);
(k) reference to Lipper’s website (www.lipperweb.com) for greater detail on the Lipper Awards and Lipper Leader ratings;
2. the Lipper Awards being referenced must not have been awarded more than 365 days before the date of the sales communication; and
3. the Lipper Awards and Lipper Leader ratings being referenced are calculated based on comparisons of performance of investment funds within a specified category established by the CIFSC (or a successor to the CIFSC).
“Vera Nunes” Manager, Investment Funds and Structured Products Ontario Securities Commission
November 27, 2014 (2014), 37 OSCB 10395
Decisions, Orders and Rulings
2.1.13 CIBC Asset Management Inc.
Headnote
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions – Existing and future mutual funds managed by the Filer granted relief from paragraphs 15.3(4)(c) and (f) of NI 81-102 Investment Funds to permit references to Lipper Leader ratings and Lipper Awards in sales communications – Relief subject to conditions requiring specified disclosure and the requirement that the Lipper Awards being referenced not have been awarded more than 365 days before the date of the sales communication.
Applicable Legislative Provisions
National Instrument 81-102 Investment Funds, ss. 15.3(4)(c) and (f), 19.1.
November 3, 2014
IN THE MATTER OF THE SECURITIES LEGISLATION OF ONTARIO (the Jurisdiction)
AND
IN THE MATTER OF THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS IN MULTIPLE JURISDICTIONS
AND
IN THE MATTER OF CIBC ASSET MANAGEMENT INC.
DECISION
Background
The principal regulator in the Jurisdiction has received an application from CIBC Asset Management Inc. (the Filer) on behalf of existing mutual funds and future mutual funds of which the Filer is or becomes the investment fund manager (or of which an affiliate of the Filer becomes the investment fund manager) and to which National Instrument 81-102 Investment Funds (NI 81- 102) applies (each a Fund and collectively, the Funds) for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) for an exemption from the requirements set out in sections 15.3(4)(c) and 15.3(4)(f) of NI 81-102, which provide that a sales communication must not refer to a performance rating or ranking of a mutual fund or asset allocation service unless:
(i) the rating or ranking is provided for each period for which standard performance data is required to be given, except the period since the inception of the mutual fund
(ii) the rating or ranking is to the same calendar month end that is:
(a) not more than 45 days before the date of the appearance or use of the advertisement in which it is included, and
(b) not more than three months before the date of first publication of any other sales communication in which it is included
(together, the Exemption Sought), to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to the Funds.
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission is the principal regulator for this application, and
November 27, 2014 (2014), 37 OSCB 10396
Decisions, Orders and Rulings
(b) the Filer has provided notice that section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in each of the other provinces and territories of Canada (together with Ontario, the Jurisdictions).
Interpretation
Terms defined in National Instrument 14-101 Definitions, MI 11-102 and NI 81-102 have the same meaning if used in this decision, unless otherwise defined.
Representations
This decision is based on the following facts represented by the Filer:
1. The Filer is the investment fund manager of the Funds and is registered as an investment fund manager in one or more of the Jurisdictions. The head office of the Filer is located in Ontario.
2. Each of the Funds is, or will be, an open-ended mutual fund established under the laws of Canada or a jurisdiction of Canada. The securities of each of the Funds are, or will be, qualified for distribution pursuant to a prospectus that has been, or will be, prepared and filed in accordance with the securities legislation of each applicable Jurisdiction. Each of the Funds is, or will be, a reporting issuer in one or more of the Jurisdictions. Each of the Funds is or will be subject to NI 81-102, including Part 15 of NI 81-102, which governs sales communications.
3. The Filer and the Funds are not in default of the securities legislation in any of the Jurisdictions.
4. The Filer wishes to include in sales communications of the Funds references to Lipper Leader ratings and Lipper Awards (where such Funds have been awarded a Lipper Award).
5. Lipper, Inc. (Lipper) is a company that is not a member of the organization of the Funds. Lipper is part of the Thomson Reuters group of companies, and is a global leader in supplying mutual fund information, analytical tools, and commentary. Lipper's fund data and analysis, fund awards designations and ratings information provide valuable insight to advisors, media and individual investors.
6. One of Lipper’s programs is the Lipper awards program. This program highlights funds that have excelled in delivering consistently strong risk-adjusted performance relative to peers and also recognizes fund families with high average scores for all funds within a particular asset class or overall. Currently the Lipper awards take place in approximately 13 countries.
7. In Canada, the Lipper Awards include the Lipper Fund Awards and Lipper ETF Awards (which will be awarded for the first time in Canada in 2014). For the Lipper Fund Awards, Lipper designates award-winning funds in most individual fund classifications for three, five and ten year periods. For the Lipper ETF Awards, Lipper will designate award- winning funds in a number of individual fund classifications for the three year period, and it is expected that awards for the five and ten year periods will be given in the future.
8. The categories for fund classification used by Lipper for the Lipper Awards in respect of Canadian funds are those maintained by the Canadian Investment Funds Standards Committee (CIFSC) (or a successor to the CIFSC), a Canadian organization that is independent of Lipper. Only those CIFSC groups of ten or more unique funds will claim a Lipper Fund Award, and only those CIFSC groups of five or more unique ETFs (each of whom have a minimum of three years of performance history) will claim a Lipper ETF Award.
9. The Lipper Awards are based on a proprietary rating methodology prepared by Lipper, the Lipper Leader Rating System. The Lipper Leader Rating System is a toolkit that uses investor-centred criteria to deliver a simple, clear description of a fund's success in meeting certain goals, such as preserving capital, lowering expenses or building wealth. Lipper Ratings provide an instant measure of a fund’s success against a specific set of key metrics, and can be useful to investors in identifying funds that meet particular characteristics.
10. In Canada, the Lipper Leader Rating System includes Lipper Leader ratings for Consistent Return (reflecting funds’ historical risk-adjusted returns relative to funds in the same classification), for Total Return (reflecting funds’ historical total return performance relative to funds in the same classification) and for Preservation (reflecting funds’ historical loss avoidance relative to other funds in the same classification). In each case, the categories for fund classification used by Lipper for the Lipper Leader ratings are those maintained by CIFSC (or a successor to the CIFSC). Lipper Leader ratings are measured monthly over 36, 60 and 120 month periods, and an overall rating is also measured, which is an un-weighted average of the previous three periods. The highest 20% of funds in each category are named
November 27, 2014 (2014), 37 OSCB 10397
Decisions, Orders and Rulings
Lipper Leaders for that particular rating and receive a score of 5, the next 20% receive a score of 4, the middle 20% are scored 3, the next 20% are scored 2 and the lowest 20% are scored 1.
11. The Lipper Awards, awarded annually in Canada, are based on the Lipper Ratings for Consistent Return measure, which, as generally described above, is a risk-adjusted mutual fund return performance measure used by Lipper that takes into account both short- and long-term risk-adjusted performance relative to fund classification, together with a measure of a fund’s consistency. In respect of the Lipper Awards for Canada, the Lipper Ratings for Consistent Return are measured over the 36, 60 and 120 month periods ending at the end of July of each year. As noted above, the highest 20% of funds in each classification are named Lipper Leaders for Consistent Return, and the highest Lipper Leader for Consistent Return in each applicable fund classification over these periods (currently, in the case of the Lipper ETF Awards, over the 36 month period only) wins a Lipper Award.
12. When a Fund is awarded a Lipper Award, it may make reference to the award in sales communications subject to the terms of a license agreement with Lipper.
13. The Lipper Leader ratings are performance ratings or rankings under NI 81-102 and Lipper Awards for Funds may be considered to be performance ratings or rankings given that the awards are based on the Lipper Leader ratings as described above. Therefore, references to Lipper Leader ratings and Lipper Awards in sales communications relating to the Funds need to meet the applicable requirements in Part 15 of NI 81-102.
14. Section 15.3(4)(c) of NI 81-102 imposes a “matching” requirement for performance ratings or rankings that are included in sales communications for funds. If a performance rating or ranking is referred to in a sales communication, the performance rating or ranking must be provided for, or “match”, each period for which standard performance data is required to be given for the fund except the period since the inception of the fund (i.e., for one, three, five and ten year periods, as applicable).
15. In Canada and elsewhere, Lipper Leader ratings are calculated only for 36, 60 and 120 month periods and are not calculated for a one year period. This means that a sales communication referencing a Lipper Leader rating cannot comply with the “matching” requirement contained in section 15.3(4)(c) of NI 81-102 because a rating is not available for the one year period. Relief from section 15.3(4)(c) of NI 81-102 is therefore required in order for Funds to reference Lipper Leader ratings in sales communications.
16. In addition, a sales communication referencing the overall Lipper Leader ratings and the Lipper Awards, which are based on the Lipper Leader ratings, must disclose the corresponding Lipper Leader rating for each period for which standard performance data is required to be given. As noted above, because a rating for the one year period is not available for the Lipper Leader ratings, sales communications referencing the overall Lipper Leader ratings or Lipper Awards also cannot comply with the matching requirement contained in section 15.3(4)(c) of NI 81-102.
17. The exemption in section 15.3(4.1) of NI 81-102 for references to overall ratings or rankings of funds cannot be relied upon to reference the overall Lipper Leader ratings or Lipper Awards in sales communications for the Funds because section 15.3(4.1) is available only if a sales communication “otherwise complies” with the requirements of section 15.3(4). As noted above, sales communications referencing the overall Lipper Leader ratings or Lipper Awards cannot comply with the matching requirement in section 15.3(4) because the underlying Lipper Leader ratings are not available for the one year period, rendering the exemption in section 15.3(4.1) unavailable. Relief from section 15.3(4)(c) is therefore required in order for Funds to reference overall Lipper Leader ratings and the Lipper Awards in sales communications.
18. Section 15.3(4)(f) of NI 81-102 imposes certain restrictions on disclosure in sales communications. The section provides that in order for a rating or ranking such as a Lipper Award to be used in an advertisement, the advertisement must be published within 45 days of the calendar month end to which the rating or ranking applies. Further, in order for the rating or ranking to be used in any other sales communication, the rating or ranking must be published within three months of the calendar month end to which the rating or ranking applies.
19. Because the evaluation of funds for the Lipper Awards will be based on data aggregated until the end of July in any given year and the results will be published in November of that year, by the time a Fund receives an award in November, section 15.3(4)(f) of NI 81-102 will prohibit it from publishing news of the award altogether.
20. The Exemption Sought is required in order for Lipper Leader ratings and Lipper Awards to be referenced in sales communications relating to the Funds.
21. The Filer submits that the Lipper Awards provide an important tool for investors, as they provide investors with context when evaluating investment choices. The Filer submits that the nature of the Lipper Leader ratings and Lipper Awards alleviates any concern that references to the ratings and awards may be misleading and therefore contrary to section
November 27, 2014 (2014), 37 OSCB 10398
Decisions, Orders and Rulings
15.2(1)(a) of NI 81-102. The Lipper Leader Rating System underlying the Lipper Leader ratings and Lipper Awards ensures an objective, transparent and quantitative measure of performance that is based on the expertise of Lipper in fund analysis.
Decision
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator under the Legislation is that the Exemption Sought is granted to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to a Fund provided that:
1. the sales communication that refers to the Lipper Award and Lipper Leader ratings complies with Part 15 of NI 81-102 other than as set out herein and contains the following disclosure in at least 10 point type:
(a) the name of the category for which the Fund has received the award or rating;
(b) the number of mutual funds in the category for the applicable period;
(c) the name of the ranking entity, i.e., Lipper;
(d) the length of period and the ending date, or, the first day of the period and the ending date on which the Lipper Award or Lipper Leader rating is based;
(e) a statement that Lipper Leader ratings are subject to change every month;
(f) in the case of a Lipper Award, a brief overview of the Lipper Awards;
(g) in the case of a Lipper Leader rating (other than Lipper Leader ratings referenced in connection with a Lipper Award), a brief overview of the Lipper Leader rating;
(h) where Lipper Awards are referenced, the corresponding Lipper Leader rating that the Lipper Award is derived from is presented for each period for which standard performance data is required other than the one year and since inception periods;
(i) where a Lipper Leader rating is referenced, the Lipper Leader ratings are presented for each period for which standard performance data is required other than the one year and since inception periods;
(j) disclosure of the meaning of the Lipper Leader ratings from 1 to 5 (e.g., ranking of 5 indicates a fund is in the top 20% of its category);
(k) reference to Lipper’s website (www.lipperweb.com) for greater detail on the Lipper Awards and Lipper Leader ratings;
2. the Lipper Awards being referenced must not have been awarded more than 365 days before the date of the sales communication; and
3. the Lipper Awards and Lipper Leader ratings being referenced are calculated based on comparisons of performance of investment funds within a specified category established by the CIFSC (or a successor to the CIFSC).
“Vera Nunes” Manager, Investment Funds and Structured Products Ontario Securities Commission
November 27, 2014 (2014), 37 OSCB 10399
Decisions, Orders and Rulings
2.1.14 Canadian Imperial Bank of Commerce
Headnote
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions – Existing and future mutual funds managed by the Filer granted relief from paragraphs 15.3(4)(c) and (f) of NI 81-102 Investment Funds to permit references to Lipper Leader ratings and Lipper Awards in sales communications – Relief subject to conditions requiring specified disclosure and the requirement that the Lipper Awards being referenced not have been awarded more than 365 days before the date of the sales communication.
Applicable Legislative Provisions
National Instrument 81-102 Investment Funds, ss. 15.3(4)(c) and (f),19.1.
November 3, 2014
IN THE MATTER OF THE SECURITIES LEGISLATION OF ONTARIO (the Jurisdiction)
AND
IN THE MATTER OF THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS IN MULTIPLE JURISDICTIONS
AND
IN THE MATTER OF CANADIAN IMPERIAL BANK OF COMMERCE
DECISION
Background
The principal regulator in the Jurisdiction has received an application from Canadian Imperial Bank of Commerce (the Filer) on behalf of existing mutual funds and future mutual funds of which the Filer is or becomes the investment fund manager (or of which an affiliate of the Filer becomes the investment fund manager) and to which National Instrument 81-102 Investment Funds (NI 81-102) applies (each a Fund and collectively, the Funds) for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) for an exemption from the requirements set out in sections 15.3(4)(c) and 15.3(4)(f) of NI 81-102, which provide that a sales communication must not refer to a performance rating or ranking of a mutual fund or asset allocation service unless:
(i) the rating or ranking is provided for each period for which standard performance data is required to be given, except the period since the inception of the mutual fund
(ii) the rating or ranking is to the same calendar month end that is:
(a) not more than 45 days before the date of the appearance or use of the advertisement in which it is included, and
(b) not more than three months before the date of first publication of any other sales communication in which it is included
(together, the Exemption Sought), to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to the Funds.
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission is the principal regulator for this application, and
November 27, 2014 (2014), 37 OSCB 10400
Decisions, Orders and Rulings
(b) the Filer has provided notice that section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in each of the other provinces and territories of Canada (together with Ontario, the Jurisdictions).
Interpretation
Terms defined in National Instrument 14-101 Definitions, MI 11-102 and NI 81-102 have the same meaning if used in this decision, unless otherwise defined.
Representations
This decision is based on the following facts represented by the Filer:
1. The Filer is the investment fund manager of the Funds and is registered as an investment fund manager in one or more of the Jurisdictions. The head office of the Filer is located in Ontario.
2. Each of the Funds is, or will be, an open-ended mutual fund established under the laws of Canada or a jurisdiction of Canada. The securities of each of the Funds are, or will be, qualified for distribution pursuant to a prospectus that has been, or will be, prepared and filed in accordance with the securities legislation of each applicable Jurisdiction. Each of the Funds is, or will be, a reporting issuer in one or more of the Jurisdictions. Each of the Funds is or will be subject to NI 81-102, including Part 15 of NI 81-102, which governs sales communications.
3. The Filer and the Funds are not in default of the securities legislation in any of the Jurisdictions.
4. The Filer wishes to include in sales communications of the Funds references to Lipper Leader ratings and Lipper Awards (where such Funds have been awarded a Lipper Award).
5. Lipper, Inc. (Lipper) is a company that is not a member of the organization of the Funds. Lipper is part of the Thomson Reuters group of companies, and is a global leader in supplying mutual fund information, analytical tools, and commentary. Lipper's fund data and analysis, fund awards designations and ratings information provide valuable insight to advisors, media and individual investors.
6. One of Lipper’s programs is the Lipper awards program. This program highlights funds that have excelled in delivering consistently strong risk-adjusted performance relative to peers and also recognizes fund families with high average scores for all funds within a particular asset class or overall. Currently the Lipper awards take place in approximately 13 countries.
7. In Canada, the Lipper Awards include the Lipper Fund Awards and Lipper ETF Awards (which will be awarded for the first time in Canada in 2014). For the Lipper Fund Awards, Lipper designates award-winning funds in most individual fund classifications for three, five and ten year periods. For the Lipper ETF Awards, Lipper will designate award- winning funds in a number of individual fund classifications for the three year period, and it is expected that awards for the five and ten year periods will be given in the future.
8. The categories for fund classification used by Lipper for the Lipper Awards in respect of Canadian funds are those maintained by the Canadian Investment Funds Standards Committee (CIFSC) (or a successor to the CIFSC), a Canadian organization that is independent of Lipper. Only those CIFSC groups of ten or more unique funds will claim a Lipper Fund Award, and only those CIFSC groups of five or more unique ETFs (each of whom have a minimum of three years of performance history) will claim a Lipper ETF Award.
9. The Lipper Awards are based on a proprietary rating methodology prepared by Lipper, the Lipper Leader Rating System. The Lipper Leader Rating System is a toolkit that uses investor-centred criteria to deliver a simple, clear description of a fund's success in meeting certain goals, such as preserving capital, lowering expenses or building wealth. Lipper Ratings provide an instant measure of a fund’s success against a specific set of key metrics, and can be useful to investors in identifying funds that meet particular characteristics.
10. In Canada, the Lipper Leader Rating System includes Lipper Leader ratings for Consistent Return (reflecting funds’ historical risk-adjusted returns relative to funds in the same classification), for Total Return (reflecting funds’ historical total return performance relative to funds in the same classification) and for Preservation (reflecting funds’ historical loss avoidance relative to other funds in the same classification). In each case, the categories for fund classification used by Lipper for the Lipper Leader ratings are those maintained by CIFSC (or a successor to the CIFSC). Lipper Leader ratings are measured monthly over 36, 60 and 120 month periods, and an overall rating is also measured, which is an un-weighted average of the previous three periods. The highest 20% of funds in each category are named
November 27, 2014 (2014), 37 OSCB 10401
Decisions, Orders and Rulings
Lipper Leaders for that particular rating and receive a score of 5, the next 20% receive a score of 4, the middle 20% are scored 3, the next 20% are scored 2 and the lowest 20% are scored 1.
11. The Lipper Awards, awarded annually in Canada, are based on the Lipper Ratings for Consistent Return measure, which, as generally described above, is a risk-adjusted mutual fund return performance measure used by Lipper that takes into account both short- and long-term risk-adjusted performance relative to fund classification, together with a measure of a fund’s consistency. In respect of the Lipper Awards for Canada, the Lipper Ratings for Consistent Return are measured over the 36, 60 and 120 month periods ending at the end of July of each year. As noted above, the highest 20% of funds in each classification are named Lipper Leaders for Consistent Return, and the highest Lipper Leader for Consistent Return in each applicable fund classification over these periods (currently, in the case of the Lipper ETF Awards, over the 36 month period only) wins a Lipper Award.
12. When a Fund is awarded a Lipper Award, it may make reference to the award in sales communications subject to the terms of a license agreement with Lipper.
13. The Lipper Leader ratings are performance ratings or rankings under NI 81-102 and Lipper Awards for Funds may be considered to be performance ratings or rankings given that the awards are based on the Lipper Leader ratings as described above. Therefore, references to Lipper Leader ratings and Lipper Awards in sales communications relating to the Funds need to meet the applicable requirements in Part 15 of NI 81-102.
14. Section 15.3(4)(c) of NI 81-102 imposes a “matching” requirement for performance ratings or rankings that are included in sales communications for funds. If a performance rating or ranking is referred to in a sales communication, the performance rating or ranking must be provided for, or “match”, each period for which standard performance data is required to be given for the fund except the period since the inception of the fund (i.e., for one, three, five and ten year periods, as applicable).
15. In Canada and elsewhere, Lipper Leader ratings are calculated only for 36, 60 and 120 month periods and are not calculated for a one year period. This means that a sales communication referencing a Lipper Leader rating cannot comply with the “matching” requirement contained in section 15.3(4)(c) of NI 81-102 because a rating is not available for the one year period. Relief from section 15.3(4)(c) of NI 81-102 is therefore required in order for Funds to reference Lipper Leader ratings in sales communications.
16. In addition, a sales communication referencing the overall Lipper Leader ratings and the Lipper Awards, which are based on the Lipper Leader ratings, must disclose the corresponding Lipper Leader rating for each period for which standard performance data is required to be given. As noted above, because a rating for the one year period is not available for the Lipper Leader ratings, sales communications referencing the overall Lipper Leader ratings or Lipper Awards also cannot comply with the matching requirement contained in section 15.3(4)(c) of NI 81-102.
17. The exemption in section 15.3(4.1) of NI 81-102 for references to overall ratings or rankings of funds cannot be relied upon to reference the overall Lipper Leader ratings or Lipper Awards in sales communications for the Funds because section 15.3(4.1) is available only if a sales communication “otherwise complies” with the requirements of section 15.3(4). As noted above, sales communications referencing the overall Lipper Leader ratings or Lipper Awards cannot comply with the matching requirement in section 15.3(4) because the underlying Lipper Leader ratings are not available for the one year period, rendering the exemption in section 15.3(4.1) unavailable. Relief from section 15.3(4)(c) is therefore required in order for Funds to reference overall Lipper Leader ratings and the Lipper Awards in sales communications.
18. Section 15.3(4)(f) of NI 81-102 imposes certain restrictions on disclosure in sales communications. The section provides that in order for a rating or ranking such as a Lipper Award to be used in an advertisement, the advertisement must be published within 45 days of the calendar month end to which the rating or ranking applies. Further, in order for the rating or ranking to be used in any other sales communication, the rating or ranking must be published within three months of the calendar month end to which the rating or ranking applies.
19. Because the evaluation of funds for the Lipper Awards will be based on data aggregated until the end of July in any given year and the results will be published in November of that year, by the time a Fund receives an award in November, section 15.3(4)(f) of NI 81-102 will prohibit it from publishing news of the award altogether.
20. The Exemption Sought is required in order for Lipper Leader ratings and Lipper Awards to be referenced in sales communications relating to the Funds.
21. The Filer submits that the Lipper Awards provide an important tool for investors, as they provide investors with context when evaluating investment choices. The Filer submits that the nature of the Lipper Leader ratings and Lipper Awards alleviates any concern that references to the ratings and awards may be misleading and therefore contrary to section
November 27, 2014 (2014), 37 OSCB 10402
Decisions, Orders and Rulings
15.2(1)(a) of NI 81-102. The Lipper Leader Rating System underlying the Lipper Leader ratings and Lipper Awards ensures an objective, transparent and quantitative measure of performance that is based on the expertise of Lipper in fund analysis.
Decision
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator under the Legislation is that the Exemption Sought is granted to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to a Fund provided that:
1. the sales communication that refers to the Lipper Award and Lipper Leader ratings complies with Part 15 of NI 81-102 other than as set out herein and contains the following disclosure in at least 10 point type:
(a) the name of the category for which the Fund has received the award or rating;
(b) the number of mutual funds in the category for the applicable period;
(c) the name of the ranking entity, i.e., Lipper;
(d) the length of period and the ending date, or, the first day of the period and the ending date on which the Lipper Award or Lipper Leader rating is based;
(e) a statement that Lipper Leader ratings are subject to change every month;
(f) in the case of a Lipper Award, a brief overview of the Lipper Awards;
(g) in the case of a Lipper Leader rating (other than Lipper Leader ratings referenced in connection with a Lipper Award), a brief overview of the Lipper Leader rating;
(h) where Lipper Awards are referenced, the corresponding Lipper Leader rating that the Lipper Award is derived from is presented for each period for which standard performance data is required other than the one year and since inception periods;
(i) where a Lipper Leader rating is referenced, the Lipper Leader ratings are presented for each period for which standard performance data is required other than the one year and since inception periods;
(j) disclosure of the meaning of the Lipper Leader ratings from 1 to 5 (e.g., ranking of 5 indicates a fund is in the top 20% of its category);
(k) reference to Lipper’s website (www.lipperweb.com) for greater detail on the Lipper Awards and Lipper Leader ratings;
2. the Lipper Awards being referenced must not have been awarded more than 365 days before the date of the sales communication; and
3. the Lipper Awards and Lipper Leader ratings being referenced are calculated based on comparisons of performance of investment funds within a specified category established by the CIFSC (or a successor to the CIFSC).
“Vera Nunes” Manager, Investment Funds and Structured Products Ontario Securities Commission
November 27, 2014 (2014), 37 OSCB 10403
Decisions, Orders and Rulings
2.1.15 Fidelity Investments Canada ULC
Headnote
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions – Existing and future mutual funds managed by the Filer granted relief from paragraphs 15.3(4)(c) and (f) of NI 81-102 Investment Funds to permit references to Lipper Leader ratings and Lipper Awards in sales communications – Relief subject to conditions requiring specified disclosure and the requirement that the Lipper Awards being referenced not have been awarded more than 365 days before the date of the sales communication.
Applicable Legislative Provisions
National Instrument 81-102 Investment Funds, ss. 15.3(4)(c) and (f), 19.1.
November 3, 2014
IN THE MATTER OF THE SECURITIES LEGISLATION OF ONTARIO (the Jurisdiction)
AND
IN THE MATTER OF THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS IN MULTIPLE JURISDICTIONS
AND
IN THE MATTER OF FIDELITY INVESTMENTS CANADA ULC
DECISION
Background
The principal regulator in the Jurisdiction has received an application from Fidelity Investments Canada ULC (the Filer) on behalf of existing mutual funds and future mutual funds of which the Filer is or becomes the investment fund manager (or of which an affiliate of the Filer becomes the investment fund manager) and to which National Instrument 81-102 Investment Funds (NI 81-102) applies (each a Fund and collectively, the Funds) for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) for an exemption from the requirements set out in sections 15.3(4)(c) and 15.3(4)(f) of NI 81-102, which provide that a sales communication must not refer to a performance rating or ranking of a mutual fund or asset allocation service unless:
(i) the rating or ranking is provided for each period for which standard performance data is required to be given, except the period since the inception of the mutual fund
(ii) the rating or ranking is to the same calendar month end that is:
(a) not more than 45 days before the date of the appearance or use of the advertisement in which it is included, and
(b) not more than three months before the date of first publication of any other sales communication in which it is included
(together, the Exemption Sought), to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to the Funds.
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission is the principal regulator for this application, and
November 27, 2014 (2014), 37 OSCB 10404
Decisions, Orders and Rulings
(b) the Filer has provided notice that section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in each of the other provinces and territories of Canada (together with Ontario, the Jurisdictions).
Interpretation
Terms defined in National Instrument 14-101 Definitions, MI 11-102 and NI 81-102 have the same meaning if used in this decision, unless otherwise defined.
Representations
This decision is based on the following facts represented by the Filer:
1. The Filer is the investment fund manager of the Funds and is registered as an investment fund manager in one or more of the Jurisdictions. The head office of the Filer is located in Ontario.
2. Each of the Funds is, or will be, an open-ended mutual fund established under the laws of Canada or a jurisdiction of Canada. The securities of each of the Funds are, or will be, qualified for distribution pursuant to a prospectus that has been, or will be, prepared and filed in accordance with the securities legislation of each applicable Jurisdiction. Each of the Funds is, or will be, a reporting issuer in one or more of the Jurisdictions. Each of the Funds is or will be subject to NI 81-102, including Part 15 of NI 81-102, which governs sales communications.
3. The Filer and the Funds are not in default of the securities legislation in any of the Jurisdictions.
4. The Filer wishes to include in sales communications of the Funds references to Lipper Leader ratings and Lipper Awards (where such Funds have been awarded a Lipper Award).
5. Lipper, Inc. (Lipper) is a company that is not a member of the organization of the Funds. Lipper is part of the Thomson Reuters group of companies, and is a global leader in supplying mutual fund information, analytical tools, and commentary. Lipper's fund data and analysis, fund awards designations and ratings information provide valuable insight to advisors, media and individual investors.
6. One of Lipper’s programs is the Lipper awards program. This program highlights funds that have excelled in delivering consistently strong risk-adjusted performance relative to peers and also recognizes fund families with high average scores for all funds within a particular asset class or overall. Currently the Lipper awards take place in approximately 13 countries.
7. In Canada, the Lipper Awards include the Lipper Fund Awards and Lipper ETF Awards (which will be awarded for the first time in Canada in 2014). For the Lipper Fund Awards, Lipper designates award-winning funds in most individual fund classifications for three, five and ten year periods. For the Lipper ETF Awards, Lipper will designate award- winning funds in a number of individual fund classifications for the three year period, and it is expected that awards for the five and ten year periods will be given in the future.
8. The categories for fund classification used by Lipper for the Lipper Awards in respect of Canadian funds are those maintained by the Canadian Investment Funds Standards Committee (CIFSC) (or a successor to the CIFSC), a Canadian organization that is independent of Lipper. Only those CIFSC groups of ten or more unique funds will claim a Lipper Fund Award, and only those CIFSC groups of five or more unique ETFs (each of whom have a minimum of three years of performance history) will claim a Lipper ETF Award.
9. The Lipper Awards are based on a proprietary rating methodology prepared by Lipper, the Lipper Leader Rating System. The Lipper Leader Rating System is a toolkit that uses investor-centred criteria to deliver a simple, clear description of a fund's success in meeting certain goals, such as preserving capital, lowering expenses or building wealth. Lipper Ratings provide an instant measure of a fund’s success against a specific set of key metrics, and can be useful to investors in identifying funds that meet particular characteristics.
10. In Canada, the Lipper Leader Rating System includes Lipper Leader ratings for Consistent Return (reflecting funds’ historical risk-adjusted returns relative to funds in the same classification), for Total Return (reflecting funds’ historical total return performance relative to funds in the same classification) and for Preservation (reflecting funds’ historical loss avoidance relative to other funds in the same classification). In each case, the categories for fund classification used by Lipper for the Lipper Leader ratings are those maintained by CIFSC (or a successor to the CIFSC). Lipper Leader ratings are measured monthly over 36, 60 and 120 month periods, and an overall rating is also measured, which is an un-weighted average of the previous three periods. The highest 20% of funds in each category are named
November 27, 2014 (2014), 37 OSCB 10405
Decisions, Orders and Rulings
Lipper Leaders for that particular rating and receive a score of 5, the next 20% receive a score of 4, the middle 20% are scored 3, the next 20% are scored 2 and the lowest 20% are scored 1.
11. The Lipper Awards, awarded annually in Canada, are based on the Lipper Ratings for Consistent Return measure, which, as generally described above, is a risk-adjusted mutual fund return performance measure used by Lipper that takes into account both short- and long-term risk-adjusted performance relative to fund classification, together with a measure of a fund’s consistency. In respect of the Lipper Awards for Canada, the Lipper Ratings for Consistent Return are measured over the 36, 60 and 120 month periods ending at the end of July of each year. As noted above, the highest 20% of funds in each classification are named Lipper Leaders for Consistent Return, and the highest Lipper Leader for Consistent Return in each applicable fund classification over these periods (currently, in the case of the Lipper ETF Awards, over the 36 month period only) wins a Lipper Award.
12. When a Fund is awarded a Lipper Award, it may make reference to the award in sales communications subject to the terms of a license agreement with Lipper.
13. The Lipper Leader ratings are performance ratings or rankings under NI 81-102 and Lipper Awards for Funds may be considered to be performance ratings or rankings given that the awards are based on the Lipper Leader ratings as described above. Therefore, references to Lipper Leader ratings and Lipper Awards in sales communications relating to the Funds need to meet the applicable requirements in Part 15 of NI 81-102.
14. Section 15.3(4)(c) of NI 81-102 imposes a “matching” requirement for performance ratings or rankings that are included in sales communications for funds. If a performance rating or ranking is referred to in a sales communication, the performance rating or ranking must be provided for, or “match”, each period for which standard performance data is required to be given for the fund except the period since the inception of the fund (i.e., for one, three, five and ten year periods, as applicable).
15. In Canada and elsewhere, Lipper Leader ratings are calculated only for 36, 60 and 120 month periods and are not calculated for a one year period. This means that a sales communication referencing a Lipper Leader rating cannot comply with the “matching” requirement contained in section 15.3(4)(c) of NI 81-102 because a rating is not available for the one year period. Relief from section 15.3(4)(c) of NI 81-102 is therefore required in order for Funds to reference Lipper Leader ratings in sales communications.
16. In addition, a sales communication referencing the overall Lipper Leader ratings and the Lipper Awards, which are based on the Lipper Leader ratings, must disclose the corresponding Lipper Leader rating for each period for which standard performance data is required to be given. As noted above, because a rating for the one year period is not available for the Lipper Leader ratings, sales communications referencing the overall Lipper Leader ratings or Lipper Awards also cannot comply with the matching requirement contained in section 15.3(4)(c) of NI 81-102.
17. The exemption in section 15.3(4.1) of NI 81-102 for references to overall ratings or rankings of funds cannot be relied upon to reference the overall Lipper Leader ratings or Lipper Awards in sales communications for the Funds because section 15.3(4.1) is available only if a sales communication “otherwise complies” with the requirements of section 15.3(4). As noted above, sales communications referencing the overall Lipper Leader ratings or Lipper Awards cannot comply with the matching requirement in section 15.3(4) because the underlying Lipper Leader ratings are not available for the one year period, rendering the exemption in section 15.3(4.1) unavailable. Relief from section 15.3(4)(c) is therefore required in order for Funds to reference overall Lipper Leader ratings and the Lipper Awards in sales communications.
18. Section 15.3(4)(f) of NI 81-102 imposes certain restrictions on disclosure in sales communications. The section provides that in order for a rating or ranking such as a Lipper Award to be used in an advertisement, the advertisement must be published within 45 days of the calendar month end to which the rating or ranking applies. Further, in order for the rating or ranking to be used in any other sales communication, the rating or ranking must be published within three months of the calendar month end to which the rating or ranking applies.
19. Because the evaluation of funds for the Lipper Awards will be based on data aggregated until the end of July in any given year and the results will be published in November of that year, by the time a Fund receives an award in November, section 15.3(4)(f) of NI 81-102 will prohibit it from publishing news of the award altogether.
20. The Exemption Sought is required in order for Lipper Leader ratings and Lipper Awards to be referenced in sales communications relating to the Funds.
21. The Filer submits that the Lipper Awards provide an important tool for investors, as they provide investors with context when evaluating investment choices. The Filer submits that the nature of the Lipper Leader ratings and Lipper Awards alleviates any concern that references to the ratings and awards may be misleading and therefore contrary to section
November 27, 2014 (2014), 37 OSCB 10406
Decisions, Orders and Rulings
15.2(1)(a) of NI 81-102. The Lipper Leader Rating System underlying the Lipper Leader ratings and Lipper Awards ensures an objective, transparent and quantitative measure of performance that is based on the expertise of Lipper in fund analysis.
Decision
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator under the Legislation is that the Exemption Sought is granted to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to a Fund provided that:
1. the sales communication that refers to the Lipper Award and Lipper Leader ratings complies with Part 15 of NI 81-102 other than as set out herein and contains the following disclosure in at least 10 point type:
(a) the name of the category for which the Fund has received the award or rating;
(b) the number of mutual funds in the category for the applicable period;
(c) the name of the ranking entity, i.e., Lipper;
(d) the length of period and the ending date, or, the first day of the period and the ending date on which the Lipper Award or Lipper Leader rating is based;
(e) a statement that Lipper Leader ratings are subject to change every month;
(f) in the case of a Lipper Award, a brief overview of the Lipper Awards;
(g) in the case of a Lipper Leader rating (other than Lipper Leader ratings referenced in connection with a Lipper Award), a brief overview of the Lipper Leader rating;
(h) where Lipper Awards are referenced, the corresponding Lipper Leader rating that the Lipper Award is derived from is presented for each period for which standard performance data is required other than the one year and since inception periods;
(i) where a Lipper Leader rating is referenced, the Lipper Leader ratings are presented for each period for which standard performance data is required other than the one year and since inception periods;
(j) disclosure of the meaning of the Lipper Leader ratings from 1 to 5 (e.g., ranking of 5 indicates a fund is in the top 20% of its category);
(k) reference to Lipper’s website (www.lipperweb.com) for greater detail on the Lipper Awards and Lipper Leader ratings;
2. the Lipper Awards being referenced must not have been awarded more than 365 days before the date of the sales communication; and
3. the Lipper Awards and Lipper Leader ratings being referenced are calculated based on comparisons of performance of investment funds within a specified category established by the CIFSC (or a successor to the CIFSC).
“Vera Nunes” Manager, Investment Funds and Structured Products Ontario Securities Commission
November 27, 2014 (2014), 37 OSCB 10407
Decisions, Orders and Rulings
2.1.16 Franklin Templeton Investments Corp.
Headnote
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions – Existing and future mutual funds managed by the Filer granted relief from paragraphs 15.3(4)(c) and (f) of NI 81-102 Investment Funds to permit references to Lipper Leader ratings and Lipper Awards in sales communications – Relief subject to conditions requiring specified disclosure and the requirement that the Lipper Awards being referenced not have been awarded more than 365 days before the date of the sales communication.
Applicable Legislative Provisions
National Instrument 81-102 Investment Funds, ss. 15.3(4)(c) and (f), and 19.1.
November 3, 2014
IN THE MATTER OF THE SECURITIES LEGISLATION OF ONTARIO (the Jurisdiction)
AND
IN THE MATTER OF THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS IN MULTIPLE JURISDICTIONS
AND
IN THE MATTER OF FRANKLIN TEMPLETON INVESTMENTS CORP.
DECISION
Background
The principal regulator in the Jurisdiction has received an application from Franklin Templeton Investments Corp. (the Filer) on behalf of existing mutual funds and future mutual funds of which the Filer is or becomes the investment fund manager (or of which an affiliate of the Filer becomes the investment fund manager) and to which National Instrument 81-102 Investment Funds (NI 81-102) applies (each a Fund and collectively, the Funds) for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) for an exemption from the requirements set out in sections 15.3(4)(c) and 15.3(4)(f) of NI 81-102, which provide that a sales communication must not refer to a performance rating or ranking of a mutual fund or asset allocation service unless:
(i) the rating or ranking is provided for each period for which standard performance data is required to be given, except the period since the inception of the mutual fund
(ii) the rating or ranking is to the same calendar month end that is:
(a) not more than 45 days before the date of the appearance or use of the advertisement in which it is included, and
(b) not more than three months before the date of first publication of any other sales communication in which it is included
(together, the Exemption Sought), to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to the Funds.
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission is the principal regulator for this application, and
November 27, 2014 (2014), 37 OSCB 10408
Decisions, Orders and Rulings
(b) the Filer has provided notice that section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in each of the other provinces and territories of Canada (together with Ontario, the Jurisdictions).
Interpretation
Terms defined in National Instrument 14-101 Definitions, MI 11-102 and NI 81-102 have the same meaning if used in this decision, unless otherwise defined.
Representations
This decision is based on the following facts represented by the Filer:
1. The Filer is the investment fund manager of the Funds and is registered as an investment fund manager in one or more of the Jurisdictions. The head office of the Filer is located in Ontario.
2. Each of the Funds is, or will be, an open-ended mutual fund established under the laws of Canada or a jurisdiction of Canada. The securities of each of the Funds are, or will be, qualified for distribution pursuant to a prospectus that has been, or will be, prepared and filed in accordance with the securities legislation of each applicable Jurisdiction. Each of the Funds is, or will be, a reporting issuer in one or more of the Jurisdictions. Each of the Funds is or will be subject to NI 81-102, including Part 15 of NI 81-102, which governs sales communications.
3. The Filer and the Funds are not in default of the securities legislation in any of the Jurisdictions.
4. The Filer wishes to include in sales communications of the Funds references to Lipper Leader ratings and Lipper Awards (where such Funds have been awarded a Lipper Award).
5. Lipper, Inc. (Lipper) is a company that is not a member of the organization of the Funds. Lipper is part of the Thomson Reuters group of companies, and is a global leader in supplying mutual fund information, analytical tools, and commentary. Lipper's fund data and analysis, fund awards designations and ratings information provide valuable insight to advisors, media and individual investors.
6. One of Lipper’s programs is the Lipper awards program. This program highlights funds that have excelled in delivering consistently strong risk-adjusted performance relative to peers and also recognizes fund families with high average scores for all funds within a particular asset class or overall. Currently the Lipper awards take place in approximately 13 countries.
7. In Canada, the Lipper Awards include the Lipper Fund Awards and Lipper ETF Awards (which will be awarded for the first time in Canada in 2014). For the Lipper Fund Awards, Lipper designates award-winning funds in most individual fund classifications for three, five and ten year periods. For the Lipper ETF Awards, Lipper will designate award- winning funds in a number of individual fund classifications for the three year period, and it is expected that awards for the five and ten year periods will be given in the future.
8. The categories for fund classification used by Lipper for the Lipper Awards in respect of Canadian funds are those maintained by the Canadian Investment Funds Standards Committee (CIFSC) (or a successor to the CIFSC), a Canadian organization that is independent of Lipper. Only those CIFSC groups of ten or more unique funds will claim a Lipper Fund Award, and only those CIFSC groups of five or more unique ETFs (each of whom have a minimum of three years of performance history) will claim a Lipper ETF Award.
9. The Lipper Awards are based on a proprietary rating methodology prepared by Lipper, the Lipper Leader Rating System. The Lipper Leader Rating System is a toolkit that uses investor-centred criteria to deliver a simple, clear description of a fund's success in meeting certain goals, such as preserving capital, lowering expenses or building wealth. Lipper Ratings provide an instant measure of a fund’s success against a specific set of key metrics, and can be useful to investors in identifying funds that meet particular characteristics.
10. In Canada, the Lipper Leader Rating System includes Lipper Leader ratings for Consistent Return (reflecting funds’ historical risk-adjusted returns relative to funds in the same classification), for Total Return (reflecting funds’ historical total return performance relative to funds in the same classification) and for Preservation (reflecting funds’ historical loss avoidance relative to other funds in the same classification). In each case, the categories for fund classification used by Lipper for the Lipper Leader ratings are those maintained by CIFSC (or a successor to the CIFSC). Lipper Leader ratings are measured monthly over 36, 60 and 120 month periods, and an overall rating is also measured, which is an un-weighted average of the previous three periods. The highest 20% of funds in each category are named
November 27, 2014 (2014), 37 OSCB 10409
Decisions, Orders and Rulings
Lipper Leaders for that particular rating and receive a score of 5, the next 20% receive a score of 4, the middle 20% are scored 3, the next 20% are scored 2 and the lowest 20% are scored 1.
11. The Lipper Awards, awarded annually in Canada, are based on the Lipper Ratings for Consistent Return measure, which, as generally described above, is a risk-adjusted mutual fund return performance measure used by Lipper that takes into account both short- and long-term risk-adjusted performance relative to fund classification, together with a measure of a fund’s consistency. In respect of the Lipper Awards for Canada, the Lipper Ratings for Consistent Return are measured over the 36, 60 and 120 month periods ending at the end of July of each year. As noted above, the highest 20% of funds in each classification are named Lipper Leaders for Consistent Return, and the highest Lipper Leader for Consistent Return in each applicable fund classification over these periods (currently, in the case of the Lipper ETF Awards, over the 36 month period only) wins a Lipper Award.
12. When a Fund is awarded a Lipper Award, it may make reference to the award in sales communications subject to the terms of a license agreement with Lipper.
13. The Lipper Leader ratings are performance ratings or rankings under NI 81-102 and Lipper Awards for Funds may be considered to be performance ratings or rankings given that the awards are based on the Lipper Leader ratings as described above. Therefore, references to Lipper Leader ratings and Lipper Awards in sales communications relating to the Funds need to meet the applicable requirements in Part 15 of NI 81-102.
14. Section 15.3(4)(c) of NI 81-102 imposes a “matching” requirement for performance ratings or rankings that are included in sales communications for funds. If a performance rating or ranking is referred to in a sales communication, the performance rating or ranking must be provided for, or “match”, each period for which standard performance data is required to be given for the fund except the period since the inception of the fund (i.e., for one, three, five and ten year periods, as applicable).
15. In Canada and elsewhere, Lipper Leader ratings are calculated only for 36, 60 and 120 month periods and are not calculated for a one year period. This means that a sales communication referencing a Lipper Leader rating cannot comply with the “matching” requirement contained in section 15.3(4)(c) of NI 81-102 because a rating is not available for the one year period. Relief from section 15.3(4)(c) of NI 81-102 is therefore required in order for Funds to reference Lipper Leader ratings in sales communications.
16. In addition, a sales communication referencing the overall Lipper Leader ratings and the Lipper Awards, which are based on the Lipper Leader ratings, must disclose the corresponding Lipper Leader rating for each period for which standard performance data is required to be given. As noted above, because a rating for the one year period is not available for the Lipper Leader ratings, sales communications referencing the overall Lipper Leader ratings or Lipper Awards also cannot comply with the matching requirement contained in section 15.3(4)(c) of NI 81-102.
17. The exemption in section 15.3(4.1) of NI 81-102 for references to overall ratings or rankings of funds cannot be relied upon to reference the overall Lipper Leader ratings or Lipper Awards in sales communications for the Funds because section 15.3(4.1) is available only if a sales communication “otherwise complies” with the requirements of section 15.3(4). As noted above, sales communications referencing the overall Lipper Leader ratings or Lipper Awards cannot comply with the matching requirement in section 15.3(4) because the underlying Lipper Leader ratings are not available for the one year period, rendering the exemption in section 15.3(4.1) unavailable. Relief from section 15.3(4)(c) is therefore required in order for Funds to reference overall Lipper Leader ratings and the Lipper Awards in sales communications.
18. Section 15.3(4)(f) of NI 81-102 imposes certain restrictions on disclosure in sales communications. The section provides that in order for a rating or ranking such as a Lipper Award to be used in an advertisement, the advertisement must be published within 45 days of the calendar month end to which the rating or ranking applies. Further, in order for the rating or ranking to be used in any other sales communication, the rating or ranking must be published within three months of the calendar month end to which the rating or ranking applies.
19. Because the evaluation of funds for the Lipper Awards will be based on data aggregated until the end of July in any given year and the results will be published in November of that year, by the time a Fund receives an award in November, section 15.3(4)(f) of NI 81-102 will prohibit it from publishing news of the award altogether.
20. The Exemption Sought is required in order for Lipper Leader ratings and Lipper Awards to be referenced in sales communications relating to the Funds.
21. The Filer submits that the Lipper Awards provide an important tool for investors, as they provide investors with context when evaluating investment choices. The Filer submits that the nature of the Lipper Leader ratings and Lipper Awards alleviates any concern that references to the ratings and awards may be misleading and therefore contrary to section
November 27, 2014 (2014), 37 OSCB 10410
Decisions, Orders and Rulings
15.2(1)(a) of NI 81-102. The Lipper Leader Rating System underlying the Lipper Leader ratings and Lipper Awards ensures an objective, transparent and quantitative measure of performance that is based on the expertise of Lipper in fund analysis.
Decision
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator under the Legislation is that the Exemption Sought is granted to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to a Fund provided that:
1. the sales communication that refers to the Lipper Award and Lipper Leader ratings complies with Part 15 of NI 81-102 other than as set out herein and contains the following disclosure in at least 10 point type:
(a) the name of the category for which the Fund has received the award or rating;
(b) the number of mutual funds in the category for the applicable period;
(c) the name of the ranking entity, i.e., Lipper;
(d) the length of period and the ending date, or, the first day of the period and the ending date on which the Lipper Award or Lipper Leader rating is based;
(e) a statement that Lipper Leader ratings are subject to change every month;
(f) in the case of a Lipper Award, a brief overview of the Lipper Awards;
(g) in the case of a Lipper Leader rating (other than Lipper Leader ratings referenced in connection with a Lipper Award), a brief overview of the Lipper Leader rating;
(h) where Lipper Awards are referenced, the corresponding Lipper Leader rating that the Lipper Award is derived from is presented for each period for which standard performance data is required other than the one year and since inception periods;
(i) where a Lipper Leader rating is referenced, the Lipper Leader ratings are presented for each period for which standard performance data is required other than the one year and since inception periods;
(j) disclosure of the meaning of the Lipper Leader ratings from 1 to 5 (e.g., ranking of 5 indicates a fund is in the top 20% of its category);
(k) reference to Lipper’s website (www.lipperweb.com) for greater detail on the Lipper Awards and Lipper Leader ratings;
2. the Lipper Awards being referenced must not have been awarded more than 365 days before the date of the sales communication; and
3. the Lipper Awards and Lipper Leader ratings being referenced are calculated based on comparisons of performance of investment funds within a specified category established by the CIFSC (or a successor to the CIFSC).
“Vera Nunes” Manager, Investment Funds and Structured Products Ontario Securities Commission
November 27, 2014 (2014), 37 OSCB 10411
Decisions, Orders and Rulings
2.1.17 Horizons ETFs Management (Canada) Inc.
Headnote
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions – Existing and future mutual funds managed by the Filer granted relief from paragraphs 15.3(4)(c) and (f) of NI 81-102 Investment Funds to permit references to Lipper Leader ratings and Lipper Awards in sales communications – Relief subject to conditions requiring specified disclosure and the requirement that the Lipper Awards being referenced not have been awarded more than 365 days before the date of the sales communication.
Applicable Legislative Provisions
National Instrument 81-102 Investment Funds, ss. 15.3(4)(c) and (f), 19.1.
November 3, 2014
IN THE MATTER OF THE SECURITIES LEGISLATION OF ONTARIO (the Jurisdiction)
AND
IN THE MATTER OF THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS IN MULTIPLE JURISDICTIONS
AND
IN THE MATTER OF HORIZONS ETFS MANAGEMENT (CANADA) INC.
DECISION
Background
The principal regulator in the Jurisdiction has received an application from Horizons ETFs Management (Canada) Inc. (the Filer) on behalf of existing mutual funds and future mutual funds of which the Filer is or becomes the investment fund manager (or of which an affiliate of the Filer becomes the investment fund manager) and to which National Instrument 81-102 Investment Funds (NI 81-102) applies (each a Fund and collectively, the Funds) for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) for an exemption from the requirements set out in sections 15.3(4)(c) and 15.3(4)(f) of NI 81-102, which provide that a sales communication must not refer to a performance rating or ranking of a mutual fund or asset allocation service unless:
(i) the rating or ranking is provided for each period for which standard performance data is required to be given, except the period since the inception of the mutual fund
(ii) the rating or ranking is to the same calendar month end that is:
(a) not more than 45 days before the date of the appearance or use of the advertisement in which it is included, and
(b) not more than three months before the date of first publication of any other sales communication in which it is included
(together, the Exemption Sought), to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to the Funds.
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission is the principal regulator for this application, and
November 27, 2014 (2014), 37 OSCB 10412
Decisions, Orders and Rulings
(b) the Filer has provided notice that section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in each of the other provinces and territories of Canada (together with Ontario, the Jurisdictions).
Interpretation
Terms defined in National Instrument 14-101 Definitions, MI 11-102 and NI 81-102 have the same meaning if used in this decision, unless otherwise defined.
Representations
This decision is based on the following facts represented by the Filer:
1. The Filer is the investment fund manager of the Funds and is registered as an investment fund manager in one or more of the Jurisdictions. The head office of the Filer is located in Ontario.
2. Each of the Funds is, or will be, an open-ended mutual fund established under the laws of Canada or a jurisdiction of Canada. The securities of each of the Funds are, or will be, qualified for distribution pursuant to a prospectus that has been, or will be, prepared and filed in accordance with the securities legislation of each applicable Jurisdiction. Each of the Funds is, or will be, a reporting issuer in one or more of the Jurisdictions. Each of the Funds is or will be subject to NI 81-102, including Part 15 of NI 81-102, which governs sales communications.
3. The Filer and the Funds are not in default of the securities legislation in any of the Jurisdictions.
4. The Filer wishes to include in sales communications of the Funds references to Lipper Leader ratings and Lipper Awards (where such Funds have been awarded a Lipper Award).
5. Lipper, Inc. (Lipper) is a company that is not a member of the organization of the Funds. Lipper is part of the Thomson Reuters group of companies, and is a global leader in supplying mutual fund information, analytical tools, and commentary. Lipper's fund data and analysis, fund awards designations and ratings information provide valuable insight to advisors, media and individual investors.
6. One of Lipper’s programs is the Lipper awards program. This program highlights funds that have excelled in delivering consistently strong risk-adjusted performance relative to peers and also recognizes fund families with high average scores for all funds within a particular asset class or overall. Currently the Lipper awards take place in approximately 13 countries.
7. In Canada, the Lipper Awards include the Lipper Fund Awards and Lipper ETF Awards (which will be awarded for the first time in Canada in 2014). For the Lipper Fund Awards, Lipper designates award-winning funds in most individual fund classifications for three, five and ten year periods. For the Lipper ETF Awards, Lipper will designate award- winning funds in a number of individual fund classifications for the three year period, and it is expected that awards for the five and ten year periods will be given in the future.
8. The categories for fund classification used by Lipper for the Lipper Awards in respect of Canadian funds are those maintained by the Canadian Investment Funds Standards Committee (CIFSC) (or a successor to the CIFSC), a Canadian organization that is independent of Lipper. Only those CIFSC groups of ten or more unique funds will claim a Lipper Fund Award, and only those CIFSC groups of five or more unique ETFs (each of whom have a minimum of three years of performance history) will claim a Lipper ETF Award.
9. The Lipper Awards are based on a proprietary rating methodology prepared by Lipper, the Lipper Leader Rating System. The Lipper Leader Rating System is a toolkit that uses investor-centred criteria to deliver a simple, clear description of a fund's success in meeting certain goals, such as preserving capital, lowering expenses or building wealth. Lipper Ratings provide an instant measure of a fund’s success against a specific set of key metrics, and can be useful to investors in identifying funds that meet particular characteristics.
10. In Canada, the Lipper Leader Rating System includes Lipper Leader ratings for Consistent Return (reflecting funds’ historical risk-adjusted returns relative to funds in the same classification), for Total Return (reflecting funds’ historical total return performance relative to funds in the same classification) and for Preservation (reflecting funds’ historical loss avoidance relative to other funds in the same classification). In each case, the categories for fund classification used by Lipper for the Lipper Leader ratings are those maintained by CIFSC (or a successor to the CIFSC). Lipper Leader ratings are measured monthly over 36, 60 and 120 month periods, and an overall rating is also measured, which is an un-weighted average of the previous three periods. The highest 20% of funds in each category are named
November 27, 2014 (2014), 37 OSCB 10413
Decisions, Orders and Rulings
Lipper Leaders for that particular rating and receive a score of 5, the next 20% receive a score of 4, the middle 20% are scored 3, the next 20% are scored 2 and the lowest 20% are scored 1.
11. The Lipper Awards, awarded annually in Canada, are based on the Lipper Ratings for Consistent Return measure, which, as generally described above, is a risk-adjusted mutual fund return performance measure used by Lipper that takes into account both short- and long-term risk-adjusted performance relative to fund classification, together with a measure of a fund’s consistency. In respect of the Lipper Awards for Canada, the Lipper Ratings for Consistent Return are measured over the 36, 60 and 120 month periods ending at the end of July of each year. As noted above, the highest 20% of funds in each classification are named Lipper Leaders for Consistent Return, and the highest Lipper Leader for Consistent Return in each applicable fund classification over these periods (currently, in the case of the Lipper ETF Awards, over the 36 month period only) wins a Lipper Award.
12. When a Fund is awarded a Lipper Award, it may make reference to the award in sales communications subject to the terms of a license agreement with Lipper.
13. The Lipper Leader ratings are performance ratings or rankings under NI 81-102 and Lipper Awards for Funds may be considered to be performance ratings or rankings given that the awards are based on the Lipper Leader ratings as described above. Therefore, references to Lipper Leader ratings and Lipper Awards in sales communications relating to the Funds need to meet the applicable requirements in Part 15 of NI 81-102.
14. Section 15.3(4)(c) of NI 81-102 imposes a “matching” requirement for performance ratings or rankings that are included in sales communications for funds. If a performance rating or ranking is referred to in a sales communication, the performance rating or ranking must be provided for, or “match”, each period for which standard performance data is required to be given for the fund except the period since the inception of the fund (i.e., for one, three, five and ten year periods, as applicable).
15. In Canada and elsewhere, Lipper Leader ratings are calculated only for 36, 60 and 120 month periods and are not calculated for a one year period. This means that a sales communication referencing a Lipper Leader rating cannot comply with the “matching” requirement contained in section 15.3(4)(c) of NI 81-102 because a rating is not available for the one year period. Relief from section 15.3(4)(c) of NI 81-102 is therefore required in order for Funds to reference Lipper Leader ratings in sales communications.
16. In addition, a sales communication referencing the overall Lipper Leader ratings and the Lipper Awards, which are based on the Lipper Leader ratings, must disclose the corresponding Lipper Leader rating for each period for which standard performance data is required to be given. As noted above, because a rating for the one year period is not available for the Lipper Leader ratings, sales communications referencing the overall Lipper Leader ratings or Lipper Awards also cannot comply with the matching requirement contained in section 15.3(4)(c) of NI 81-102.
17. The exemption in section 15.3(4.1) of NI 81-102 for references to overall ratings or rankings of funds cannot be relied upon to reference the overall Lipper Leader ratings or Lipper Awards in sales communications for the Funds because section 15.3(4.1) is available only if a sales communication “otherwise complies” with the requirements of section 15.3(4). As noted above, sales communications referencing the overall Lipper Leader ratings or Lipper Awards cannot comply with the matching requirement in section 15.3(4) because the underlying Lipper Leader ratings are not available for the one year period, rendering the exemption in section 15.3(4.1) unavailable. Relief from section 15.3(4)(c) is therefore required in order for Funds to reference overall Lipper Leader ratings and the Lipper Awards in sales communications.
18. Section 15.3(4)(f) of NI 81-102 imposes certain restrictions on disclosure in sales communications. The section provides that in order for a rating or ranking such as a Lipper Award to be used in an advertisement, the advertisement must be published within 45 days of the calendar month end to which the rating or ranking applies. Further, in order for the rating or ranking to be used in any other sales communication, the rating or ranking must be published within three months of the calendar month end to which the rating or ranking applies.
19. Because the evaluation of funds for the Lipper Awards will be based on data aggregated until the end of July in any given year and the results will be published in November of that year, by the time a Fund receives an award in November, section 15.3(4)(f) of NI 81-102 will prohibit it from publishing news of the award altogether.
20. The Exemption Sought is required in order for Lipper Leader ratings and Lipper Awards to be referenced in sales communications relating to the Funds.
21. The Filer submits that the Lipper Awards provide an important tool for investors, as they provide investors with context when evaluating investment choices. The Filer submits that the nature of the Lipper Leader ratings and Lipper Awards alleviates any concern that references to the ratings and awards may be misleading and therefore contrary to section
November 27, 2014 (2014), 37 OSCB 10414
Decisions, Orders and Rulings
15.2(1)(a) of NI 81-102. The Lipper Leader Rating System underlying the Lipper Leader ratings and Lipper Awards ensures an objective, transparent and quantitative measure of performance that is based on the expertise of Lipper in fund analysis.
Decision
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator under the Legislation is that the Exemption Sought is granted to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to a Fund provided that:
1. the sales communication that refers to the Lipper Award and Lipper Leader ratings complies with Part 15 of NI 81-102 other than as set out herein and contains the following disclosure in at least 10 point type:
(a) the name of the category for which the Fund has received the award or rating;
(b) the number of mutual funds in the category for the applicable period;
(c) the name of the ranking entity, i.e., Lipper;
(d) the length of period and the ending date, or, the first day of the period and the ending date on which the Lipper Award or Lipper Leader rating is based;
(e) a statement that Lipper Leader ratings are subject to change every month;
(f) in the case of a Lipper Award, a brief overview of the Lipper Awards;
(g) in the case of a Lipper Leader rating (other than Lipper Leader ratings referenced in connection with a Lipper Award), a brief overview of the Lipper Leader rating;
(h) where Lipper Awards are referenced, the corresponding Lipper Leader rating that the Lipper Award is derived from is presented for each period for which standard performance data is required other than the one year and since inception periods;
(i) where a Lipper Leader rating is referenced, the Lipper Leader ratings are presented for each period for which standard performance data is required other than the one year and since inception periods;
(j) disclosure of the meaning of the Lipper Leader ratings from 1 to 5 (e.g., ranking of 5 indicates a fund is in the top 20% of its category);
(k) reference to Lipper’s website (www.lipperweb.com) for greater detail on the Lipper Awards and Lipper Leader ratings;
2. the Lipper Awards being referenced must not have been awarded more than 365 days before the date of the sales communication; and
3. the Lipper Awards and Lipper Leader ratings being referenced are calculated based on comparisons of performance of investment funds within a specified category established by the CIFSC (or a successor to the CIFSC).
“Vera Nunes” Manager, Investment Funds and Structured Products Ontario Securities Commission
November 27, 2014 (2014), 37 OSCB 10415
Decisions, Orders and Rulings
2.1.18 Invesco Canada Ltd.
Headnote
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions – Existing and future mutual funds managed by the Filer granted relief from paragraphs 15.3(4)(c) and (f) of NI 81-102 Investment Funds to permit references to Lipper Leader ratings and Lipper Awards in sales communications – Relief subject to conditions requiring specified disclosure and the requirement that the Lipper Awards being referenced not have been awarded more than 365 days before the date of the sales communication.
Applicable Legislative Provisions
National Instrument 81-102 Investment Funds, ss. 15.3(4)(c) and (f), 19.1.
November 3, 2014
IN THE MATTER OF THE SECURITIES LEGISLATION OF ONTARIO (the Jurisdiction)
AND
IN THE MATTER OF THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS IN MULTIPLE JURISDICTIONS
AND
IN THE MATTER OF INVESCO CANADA LTD.
DECISION
Background
The principal regulator in the Jurisdiction has received an application from Invesco Canada Ltd. (the Filer) on behalf of existing mutual funds and future mutual funds of which the Filer is or becomes the investment fund manager (or of which an affiliate of the Filer becomes the investment fund manager) and to which National Instrument 81-102 Investment Funds (NI 81-102) applies (each a Fund and collectively, the Funds) for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) for an exemption from the requirements set out in sections 15.3(4)(c) and 15.3(4)(f) of NI 81-102, which provide that a sales communication must not refer to a performance rating or ranking of a mutual fund or asset allocation service unless:
(i) the rating or ranking is provided for each period for which standard performance data is required to be given, except the period since the inception of the mutual fund
(ii) the rating or ranking is to the same calendar month end that is:
(a) not more than 45 days before the date of the appearance or use of the advertisement in which it is included, and
(b) not more than three months before the date of first publication of any other sales communication in which it is included
(together, the Exemption Sought), to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to the Funds.
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission is the principal regulator for this application, and
November 27, 2014 (2014), 37 OSCB 10416
Decisions, Orders and Rulings
(b) the Filer has provided notice that section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in each of the other provinces and territories of Canada (together with Ontario, the Jurisdictions).
Interpretation
Terms defined in National Instrument 14-101 Definitions, MI 11-102 and NI 81-102 have the same meaning if used in this decision, unless otherwise defined.
Representations
This decision is based on the following facts represented by the Filer:
1. The Filer is the investment fund manager of the Funds and is registered as an investment fund manager in one or more of the Jurisdictions. The head office of the Filer is located in Ontario.
2. Each of the Funds is, or will be, an open-ended mutual fund established under the laws of Canada or a jurisdiction of Canada. The securities of each of the Funds are, or will be, qualified for distribution pursuant to a prospectus that has been, or will be, prepared and filed in accordance with the securities legislation of each applicable Jurisdiction. Each of the Funds is, or will be, a reporting issuer in one or more of the Jurisdictions. Each of the Funds is or will be subject to NI 81-102, including Part 15 of NI 81-102, which governs sales communications.
3. The Filer and the Funds are not in default of the securities legislation in any of the Jurisdictions.
4. The Filer wishes to include in sales communications of the Funds references to Lipper Leader ratings and Lipper Awards (where such Funds have been awarded a Lipper Award).
5. Lipper, Inc. (Lipper) is a company that is not a member of the organization of the Funds. Lipper is part of the Thomson Reuters group of companies, and is a global leader in supplying mutual fund information, analytical tools, and commentary. Lipper's fund data and analysis, fund awards designations and ratings information provide valuable insight to advisors, media and individual investors.
6. One of Lipper’s programs is the Lipper awards program. This program highlights funds that have excelled in delivering consistently strong risk-adjusted performance relative to peers and also recognizes fund families with high average scores for all funds within a particular asset class or overall. Currently the Lipper awards take place in approximately 13 countries.
7. In Canada, the Lipper Awards include the Lipper Fund Awards and Lipper ETF Awards (which will be awarded for the first time in Canada in 2014). For the Lipper Fund Awards, Lipper designates award-winning funds in most individual fund classifications for three, five and ten year periods. For the Lipper ETF Awards, Lipper will designate award- winning funds in a number of individual fund classifications for the three year period, and it is expected that awards for the five and ten year periods will be given in the future.
8. The categories for fund classification used by Lipper for the Lipper Awards in respect of Canadian funds are those maintained by the Canadian Investment Funds Standards Committee (CIFSC) (or a successor to the CIFSC), a Canadian organization that is independent of Lipper. Only those CIFSC groups of ten or more unique funds will claim a Lipper Fund Award, and only those CIFSC groups of five or more unique ETFs (each of whom have a minimum of three years of performance history) will claim a Lipper ETF Award.
9. The Lipper Awards are based on a proprietary rating methodology prepared by Lipper, the Lipper Leader Rating System. The Lipper Leader Rating System is a toolkit that uses investor-centred criteria to deliver a simple, clear description of a fund's success in meeting certain goals, such as preserving capital, lowering expenses or building wealth. Lipper Ratings provide an instant measure of a fund’s success against a specific set of key metrics, and can be useful to investors in identifying funds that meet particular characteristics.
10. In Canada, the Lipper Leader Rating System includes Lipper Leader ratings for Consistent Return (reflecting funds’ historical risk-adjusted returns relative to funds in the same classification), for Total Return (reflecting funds’ historical total return performance relative to funds in the same classification) and for Preservation (reflecting funds’ historical loss avoidance relative to other funds in the same classification). In each case, the categories for fund classification used by Lipper for the Lipper Leader ratings are those maintained by CIFSC (or a successor to the CIFSC). Lipper Leader ratings are measured monthly over 36, 60 and 120 month periods, and an overall rating is also measured, which is an un-weighted average of the previous three periods. The highest 20% of funds in each category are named
November 27, 2014 (2014), 37 OSCB 10417
Decisions, Orders and Rulings
Lipper Leaders for that particular rating and receive a score of 5, the next 20% receive a score of 4, the middle 20% are scored 3, the next 20% are scored 2 and the lowest 20% are scored 1.
11. The Lipper Awards, awarded annually in Canada, are based on the Lipper Ratings for Consistent Return measure, which, as generally described above, is a risk-adjusted mutual fund return performance measure used by Lipper that takes into account both short- and long-term risk-adjusted performance relative to fund classification, together with a measure of a fund’s consistency. In respect of the Lipper Awards for Canada, the Lipper Ratings for Consistent Return are measured over the 36, 60 and 120 month periods ending at the end of July of each year. As noted above, the highest 20% of funds in each classification are named Lipper Leaders for Consistent Return, and the highest Lipper Leader for Consistent Return in each applicable fund classification over these periods (currently, in the case of the Lipper ETF Awards, over the 36 month period only) wins a Lipper Award.
12. When a Fund is awarded a Lipper Award, it may make reference to the award in sales communications subject to the terms of a license agreement with Lipper.
13. The Lipper Leader ratings are performance ratings or rankings under NI 81-102 and Lipper Awards for Funds may be considered to be performance ratings or rankings given that the awards are based on the Lipper Leader ratings as described above. Therefore, references to Lipper Leader ratings and Lipper Awards in sales communications relating to the Funds need to meet the applicable requirements in Part 15 of NI 81-102.
14. Section 15.3(4)(c) of NI 81-102 imposes a “matching” requirement for performance ratings or rankings that are included in sales communications for funds. If a performance rating or ranking is referred to in a sales communication, the performance rating or ranking must be provided for, or “match”, each period for which standard performance data is required to be given for the fund except the period since the inception of the fund (i.e., for one, three, five and ten year periods, as applicable).
15. In Canada and elsewhere, Lipper Leader ratings are calculated only for 36, 60 and 120 month periods and are not calculated for a one year period. This means that a sales communication referencing a Lipper Leader rating cannot comply with the “matching” requirement contained in section 15.3(4)(c) of NI 81-102 because a rating is not available for the one year period. Relief from section 15.3(4)(c) of NI 81-102 is therefore required in order for Funds to reference Lipper Leader ratings in sales communications.
16. In addition, a sales communication referencing the overall Lipper Leader ratings and the Lipper Awards, which are based on the Lipper Leader ratings, must disclose the corresponding Lipper Leader rating for each period for which standard performance data is required to be given. As noted above, because a rating for the one year period is not available for the Lipper Leader ratings, sales communications referencing the overall Lipper Leader ratings or Lipper Awards also cannot comply with the matching requirement contained in section 15.3(4)(c) of NI 81-102.
17. The exemption in section 15.3(4.1) of NI 81-102 for references to overall ratings or rankings of funds cannot be relied upon to reference the overall Lipper Leader ratings or Lipper Awards in sales communications for the Funds because section 15.3(4.1) is available only if a sales communication “otherwise complies” with the requirements of section 15.3(4). As noted above, sales communications referencing the overall Lipper Leader ratings or Lipper Awards cannot comply with the matching requirement in section 15.3(4) because the underlying Lipper Leader ratings are not available for the one year period, rendering the exemption in section 15.3(4.1) unavailable. Relief from section 15.3(4)(c) is therefore required in order for Funds to reference overall Lipper Leader ratings and the Lipper Awards in sales communications.
18. Section 15.3(4)(f) of NI 81-102 imposes certain restrictions on disclosure in sales communications. The section provides that in order for a rating or ranking such as a Lipper Award to be used in an advertisement, the advertisement must be published within 45 days of the calendar month end to which the rating or ranking applies. Further, in order for the rating or ranking to be used in any other sales communication, the rating or ranking must be published within three months of the calendar month end to which the rating or ranking applies.
19. Because the evaluation of funds for the Lipper Awards will be based on data aggregated until the end of July in any given year and the results will be published in November of that year, by the time a Fund receives an award in November, section 15.3(4)(f) of NI 81-102 will prohibit it from publishing news of the award altogether.
20. The Exemption Sought is required in order for Lipper Leader ratings and Lipper Awards to be referenced in sales communications relating to the Funds.
21. The Filer submits that the Lipper Awards provide an important tool for investors, as they provide investors with context when evaluating investment choices. The Filer submits that the nature of the Lipper Leader ratings and Lipper Awards alleviates any concern that references to the ratings and awards may be misleading and therefore contrary to section
November 27, 2014 (2014), 37 OSCB 10418
Decisions, Orders and Rulings
15.2(1)(a) of NI 81-102. The Lipper Leader Rating System underlying the Lipper Leader ratings and Lipper Awards ensures an objective, transparent and quantitative measure of performance that is based on the expertise of Lipper in fund analysis.
Decision
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator under the Legislation is that the Exemption Sought is granted to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to a Fund provided that:
1. the sales communication that refers to the Lipper Award and Lipper Leader ratings complies with Part 15 of NI 81-102 other than as set out herein and contains the following disclosure in at least 10 point type:
(a) the name of the category for which the Fund has received the award or rating;
(b) the number of mutual funds in the category for the applicable period;
(c) the name of the ranking entity, i.e., Lipper;
(d) the length of period and the ending date, or, the first day of the period and the ending date on which the Lipper Award or Lipper Leader rating is based;
(e) a statement that Lipper Leader ratings are subject to change every month;
(f) in the case of a Lipper Award, a brief overview of the Lipper Awards;
(g) in the case of a Lipper Leader rating (other than Lipper Leader ratings referenced in connection with a Lipper Award), a brief overview of the Lipper Leader rating;
(h) where Lipper Awards are referenced, the corresponding Lipper Leader rating that the Lipper Award is derived from is presented for each period for which standard performance data is required other than the one year and since inception periods;
(i) where a Lipper Leader rating is referenced, the Lipper Leader ratings are presented for each period for which standard performance data is required other than the one year and since inception periods;
(j) disclosure of the meaning of the Lipper Leader ratings from 1 to 5 (e.g., ranking of 5 indicates a fund is in the top 20% of its category);
(k) reference to Lipper’s website (www.lipperweb.com) for greater detail on the Lipper Awards and Lipper Leader ratings;
2. the Lipper Awards being referenced must not have been awarded more than 365 days before the date of the sales communication; and
3. the Lipper Awards and Lipper Leader ratings being referenced are calculated based on comparisons of performance of investment funds within a specified category established by the CIFSC (or a successor to the CIFSC).
“Vera Nunes” Manager, Investment Funds and Structured Products Ontario Securities Commission
November 27, 2014 (2014), 37 OSCB 10419
Decisions, Orders and Rulings
2.1.19 Mackenzie Financial Corporation
Headnote
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions – Existing and future mutual funds managed by the Filer granted relief from paragraphs 15.3(4)(c) and (f) of NI 81-102 Investment Funds to permit references to Lipper Leader ratings and Lipper Awards in sales communications – Relief subject to conditions requiring specified disclosure and the requirement that the Lipper Awards being referenced not have been awarded more than 365 days before the date of the sales communication.
Applicable Legislative Provisions
National Instrument 81-102 Investment Funds, ss. 15.3(4)(c) and (f), 19.1.
November 3, 2014
IN THE MATTER OF THE SECURITIES LEGISLATION OF ONTARIO (the Jurisdiction)
AND
IN THE MATTER OF THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS IN MULTIPLE JURISDICTIONS
AND
IN THE MATTER OF MACKENZIE FINANCIAL CORPORATION
DECISION
Background
The principal regulator in the Jurisdiction has received an application from Mackenzie Financial Corporation (the Filer) on behalf of existing mutual funds and future mutual funds of which the Filer is or becomes the investment fund manager (or of which an affiliate of the Filer becomes the investment fund manager) and to which National Instrument 81-102 Investment Funds (NI 81- 102) applies (each a Fund and collectively, the Funds) for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) for an exemption from the requirements set out in sections 15.3(4)(c) and 15.3(4)(f) of NI 81-102, which provide that a sales communication must not refer to a performance rating or ranking of a mutual fund or asset allocation service unless:
(i) the rating or ranking is provided for each period for which standard performance data is required to be given, except the period since the inception of the mutual fund
(ii) the rating or ranking is to the same calendar month end that is:
(a) not more than 45 days before the date of the appearance or use of the advertisement in which it is included, and
(b) not more than three months before the date of first publication of any other sales communication in which it is included
(together, the Exemption Sought), to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to the Funds.
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission is the principal regulator for this application, and
November 27, 2014 (2014), 37 OSCB 10420
Decisions, Orders and Rulings
(b) the Filer has provided notice that section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in each of the other provinces and territories of Canada (together with Ontario, the Jurisdictions).
Interpretation
Terms defined in National Instrument 14-101 Definitions, MI 11-102 and NI 81-102 have the same meaning if used in this decision, unless otherwise defined.
Representations
This decision is based on the following facts represented by the Filer:
1. The Filer is the investment fund manager of the Funds and is registered as an investment fund manager in one or more of the Jurisdictions. The head office of the Filer is located in Ontario.
2. Each of the Funds is, or will be, an open-ended mutual fund established under the laws of Canada or a jurisdiction of Canada. The securities of each of the Funds are, or will be, qualified for distribution pursuant to a prospectus that has been, or will be, prepared and filed in accordance with the securities legislation of each applicable Jurisdiction. Each of the Funds is, or will be, a reporting issuer in one or more of the Jurisdictions. Each of the Funds is or will be subject to NI 81-102, including Part 15 of NI 81-102, which governs sales communications.
3. The Filer and the Funds are not in default of the securities legislation in any of the Jurisdictions.
4. The Filer wishes to include in sales communications of the Funds references to Lipper Leader ratings and Lipper Awards (where such Funds have been awarded a Lipper Award).
5. Lipper, Inc. (Lipper) is a company that is not a member of the organization of the Funds. Lipper is part of the Thomson Reuters group of companies, and is a global leader in supplying mutual fund information, analytical tools, and commentary. Lipper's fund data and analysis, fund awards designations and ratings information provide valuable insight to advisors, media and individual investors.
6. One of Lipper’s programs is the Lipper awards program. This program highlights funds that have excelled in delivering consistently strong risk-adjusted performance relative to peers and also recognizes fund families with high average scores for all funds within a particular asset class or overall. Currently the Lipper awards take place in approximately 13 countries.
7. In Canada, the Lipper Awards include the Lipper Fund Awards and Lipper ETF Awards (which will be awarded for the first time in Canada in 2014). For the Lipper Fund Awards, Lipper designates award-winning funds in most individual fund classifications for three, five and ten year periods. For the Lipper ETF Awards, Lipper will designate award- winning funds in a number of individual fund classifications for the three year period, and it is expected that awards for the five and ten year periods will be given in the future.
8. The categories for fund classification used by Lipper for the Lipper Awards in respect of Canadian funds are those maintained by the Canadian Investment Funds Standards Committee (CIFSC) (or a successor to the CIFSC), a Canadian organization that is independent of Lipper. Only those CIFSC groups of ten or more unique funds will claim a Lipper Fund Award, and only those CIFSC groups of five or more unique ETFs (each of whom have a minimum of three years of performance history) will claim a Lipper ETF Award.
9. The Lipper Awards are based on a proprietary rating methodology prepared by Lipper, the Lipper Leader Rating System. The Lipper Leader Rating System is a toolkit that uses investor-centred criteria to deliver a simple, clear description of a fund's success in meeting certain goals, such as preserving capital, lowering expenses or building wealth. Lipper Ratings provide an instant measure of a fund’s success against a specific set of key metrics, and can be useful to investors in identifying funds that meet particular characteristics.
10. In Canada, the Lipper Leader Rating System includes Lipper Leader ratings for Consistent Return (reflecting funds’ historical risk-adjusted returns relative to funds in the same classification), for Total Return (reflecting funds’ historical total return performance relative to funds in the same classification) and for Preservation (reflecting funds’ historical loss avoidance relative to other funds in the same classification). In each case, the categories for fund classification used by Lipper for the Lipper Leader ratings are those maintained by CIFSC (or a successor to the CIFSC). Lipper Leader ratings are measured monthly over 36, 60 and 120 month periods, and an overall rating is also measured, which is an un-weighted average of the previous three periods. The highest 20% of funds in each category are named
November 27, 2014 (2014), 37 OSCB 10421
Decisions, Orders and Rulings
Lipper Leaders for that particular rating and receive a score of 5, the next 20% receive a score of 4, the middle 20% are scored 3, the next 20% are scored 2 and the lowest 20% are scored 1.
11. The Lipper Awards, awarded annually in Canada, are based on the Lipper Ratings for Consistent Return measure, which, as generally described above, is a risk-adjusted mutual fund return performance measure used by Lipper that takes into account both short- and long-term risk-adjusted performance relative to fund classification, together with a measure of a fund’s consistency. In respect of the Lipper Awards for Canada, the Lipper Ratings for Consistent Return are measured over the 36, 60 and 120 month periods ending at the end of July of each year. As noted above, the highest 20% of funds in each classification are named Lipper Leaders for Consistent Return, and the highest Lipper Leader for Consistent Return in each applicable fund classification over these periods (currently, in the case of the Lipper ETF Awards, over the 36 month period only) wins a Lipper Award.
12. When a Fund is awarded a Lipper Award, it may make reference to the award in sales communications subject to the terms of a license agreement with Lipper.
13. The Lipper Leader ratings are performance ratings or rankings under NI 81-102 and Lipper Awards for Funds may be considered to be performance ratings or rankings given that the awards are based on the Lipper Leader ratings as described above. Therefore, references to Lipper Leader ratings and Lipper Awards in sales communications relating to the Funds need to meet the applicable requirements in Part 15 of NI 81-102.
14. Section 15.3(4)(c) of NI 81-102 imposes a “matching” requirement for performance ratings or rankings that are included in sales communications for funds. If a performance rating or ranking is referred to in a sales communication, the performance rating or ranking must be provided for, or “match”, each period for which standard performance data is required to be given for the fund except the period since the inception of the fund (i.e., for one, three, five and ten year periods, as applicable).
15. In Canada and elsewhere, Lipper Leader ratings are calculated only for 36, 60 and 120 month periods and are not calculated for a one year period. This means that a sales communication referencing a Lipper Leader rating cannot comply with the “matching” requirement contained in section 15.3(4)(c) of NI 81-102 because a rating is not available for the one year period. Relief from section 15.3(4)(c) of NI 81-102 is therefore required in order for Funds to reference Lipper Leader ratings in sales communications.
16. In addition, a sales communication referencing the overall Lipper Leader ratings and the Lipper Awards, which are based on the Lipper Leader ratings, must disclose the corresponding Lipper Leader rating for each period for which standard performance data is required to be given. As noted above, because a rating for the one year period is not available for the Lipper Leader ratings, sales communications referencing the overall Lipper Leader ratings or Lipper Awards also cannot comply with the matching requirement contained in section 15.3(4)(c) of NI 81-102.
17. The exemption in section 15.3(4.1) of NI 81-102 for references to overall ratings or rankings of funds cannot be relied upon to reference the overall Lipper Leader ratings or Lipper Awards in sales communications for the Funds because section 15.3(4.1) is available only if a sales communication “otherwise complies” with the requirements of section 15.3(4). As noted above, sales communications referencing the overall Lipper Leader ratings or Lipper Awards cannot comply with the matching requirement in section 15.3(4) because the underlying Lipper Leader ratings are not available for the one year period, rendering the exemption in section 15.3(4.1) unavailable. Relief from section 15.3(4)(c) is therefore required in order for Funds to reference overall Lipper Leader ratings and the Lipper Awards in sales communications.
18. Section 15.3(4)(f) of NI 81-102 imposes certain restrictions on disclosure in sales communications. The section provides that in order for a rating or ranking such as a Lipper Award to be used in an advertisement, the advertisement must be published within 45 days of the calendar month end to which the rating or ranking applies. Further, in order for the rating or ranking to be used in any other sales communication, the rating or ranking must be published within three months of the calendar month end to which the rating or ranking applies.
19. Because the evaluation of funds for the Lipper Awards will be based on data aggregated until the end of July in any given year and the results will be published in November of that year, by the time a Fund receives an award in November, section 15.3(4)(f) of NI 81-102 will prohibit it from publishing news of the award altogether.
20. The Exemption Sought is required in order for Lipper Leader ratings and Lipper Awards to be referenced in sales communications relating to the Funds.
21. The Filer submits that the Lipper Awards provide an important tool for investors, as they provide investors with context when evaluating investment choices. The Filer submits that the nature of the Lipper Leader ratings and Lipper Awards alleviates any concern that references to the ratings and awards may be misleading and therefore contrary to section
November 27, 2014 (2014), 37 OSCB 10422
Decisions, Orders and Rulings
15.2(1)(a) of NI 81-102. The Lipper Leader Rating System underlying the Lipper Leader ratings and Lipper Awards ensures an objective, transparent and quantitative measure of performance that is based on the expertise of Lipper in fund analysis.
Decision
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator under the Legislation is that the Exemption Sought is granted to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to a Fund provided that:
1. the sales communication that refers to the Lipper Award and Lipper Leader ratings complies with Part 15 of NI 81-102 other than as set out herein and contains the following disclosure in at least 10 point type:
(a) the name of the category for which the Fund has received the award or rating;
(b) the number of mutual funds in the category for the applicable period;
(c) the name of the ranking entity, i.e., Lipper;
(d) the length of period and the ending date, or, the first day of the period and the ending date on which the Lipper Award or Lipper Leader rating is based;
(e) a statement that Lipper Leader ratings are subject to change every month;
(f) in the case of a Lipper Award, a brief overview of the Lipper Awards;
(g) in the case of a Lipper Leader rating (other than Lipper Leader ratings referenced in connection with a Lipper Award), a brief overview of the Lipper Leader rating;
(h) where Lipper Awards are referenced, the corresponding Lipper Leader rating that the Lipper Award is derived from is presented for each period for which standard performance data is required other than the one year and since inception periods;
(i) where a Lipper Leader rating is referenced, the Lipper Leader ratings are presented for each period for which standard performance data is required other than the one year and since inception periods;
(j) disclosure of the meaning of the Lipper Leader ratings from 1 to 5 (e.g., ranking of 5 indicates a fund is in the top 20% of its category);
(k) reference to Lipper’s website (www.lipperweb.com) for greater detail on the Lipper Awards and Lipper Leader ratings;
2. the Lipper Awards being referenced must not have been awarded more than 365 days before the date of the sales communication; and
3. the Lipper Awards and Lipper Leader ratings being referenced are calculated based on comparisons of performance of investment funds within a specified category established by the CIFSC (or a successor to the CIFSC).
“Vera Nunes” Manager, Investment Funds and Structured Products Ontario Securities Commission
November 27, 2014 (2014), 37 OSCB 10423
Decisions, Orders and Rulings
2.1.20 Manulife Asset Management Limited
Headnote
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions – Existing and future mutual funds managed by the Filer granted relief from paragraphs 15.3(4)(c) and (f) of NI 81-102 Investment Funds to permit references to Lipper Leader ratings and Lipper Awards in sales communications – Relief subject to conditions requiring specified disclosure and the requirement that the Lipper Awards being referenced not have been awarded more than 365 days before the date of the sales communication.
Applicable Legislative Provisions
National Instrument 81-102 Investment Funds, ss. 15.3(4)(c) and (f), 19.1.
November 3, 2014
IN THE MATTER OF THE SECURITIES LEGISLATION OF ONTARIO (the Jurisdiction)
AND
IN THE MATTER OF THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS IN MULTIPLE JURISDICTIONS
AND
IN THE MATTER OF MANULIFE ASSET MANAGEMENT LIMITED
DECISION
Background
The principal regulator in the Jurisdiction has received an application from Manulife Asset Management Limited (the Filer) on behalf of existing mutual funds and future mutual funds of which the Filer is or becomes the investment fund manager (or of which an affiliate of the Filer becomes the investment fund manager) and to which National Instrument 81-102 Investment Funds (NI 81-102) applies (each a Fund and collectively, the Funds) for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) for an exemption from the requirements set out in sections 15.3(4)(c) and 15.3(4)(f) of NI 81-102, which provide that a sales communication must not refer to a performance rating or ranking of a mutual fund or asset allocation service unless:
(i) the rating or ranking is provided for each period for which standard performance data is required to be given, except the period since the inception of the mutual fund
(ii) the rating or ranking is to the same calendar month end that is:
(a) not more than 45 days before the date of the appearance or use of the advertisement in which it is included, and
(b) not more than three months before the date of first publication of any other sales communication in which it is included
(together, the Exemption Sought), to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to the Funds.
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission is the principal regulator for this application, and
November 27, 2014 (2014), 37 OSCB 10424
Decisions, Orders and Rulings
(b) the Filer has provided notice that section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in each of the other provinces and territories of Canada (together with Ontario, the Jurisdictions).
Interpretation
Terms defined in National Instrument 14-101 Definitions, MI 11-102 and NI 81-102 have the same meaning if used in this decision, unless otherwise defined.
Representations
This decision is based on the following facts represented by the Filer:
1. The Filer is the investment fund manager of the Funds and is registered as an investment fund manager in one or more of the Jurisdictions. The head office of the Filer is located in Ontario.
2. Each of the Funds is, or will be, an open-ended mutual fund established under the laws of Canada or a jurisdiction of Canada. The securities of each of the Funds are, or will be, qualified for distribution pursuant to a prospectus that has been, or will be, prepared and filed in accordance with the securities legislation of each applicable Jurisdiction. Each of the Funds is, or will be, a reporting issuer in one or more of the Jurisdictions. Each of the Funds is or will be subject to NI 81-102, including Part 15 of NI 81-102, which governs sales communications.
3. The Filer and the Funds are not in default of the securities legislation in any of the Jurisdictions.
4. The Filer wishes to include in sales communications of the Funds references to Lipper Leader ratings and Lipper Awards (where such Funds have been awarded a Lipper Award).
5. Lipper, Inc. (Lipper) is a company that is not a member of the organization of the Funds. Lipper is part of the Thomson Reuters group of companies, and is a global leader in supplying mutual fund information, analytical tools, and commentary. Lipper's fund data and analysis, fund awards designations and ratings information provide valuable insight to advisors, media and individual investors.
6. One of Lipper’s programs is the Lipper awards program. This program highlights funds that have excelled in delivering consistently strong risk-adjusted performance relative to peers and also recognizes fund families with high average scores for all funds within a particular asset class or overall. Currently the Lipper awards take place in approximately 13 countries.
7. In Canada, the Lipper Awards include the Lipper Fund Awards and Lipper ETF Awards (which will be awarded for the first time in Canada in 2014). For the Lipper Fund Awards, Lipper designates award-winning funds in most individual fund classifications for three, five and ten year periods. For the Lipper ETF Awards, Lipper will designate award- winning funds in a number of individual fund classifications for the three year period, and it is expected that awards for the five and ten year periods will be given in the future.
8. The categories for fund classification used by Lipper for the Lipper Awards in respect of Canadian funds are those maintained by the Canadian Investment Funds Standards Committee (CIFSC) (or a successor to the CIFSC), a Canadian organization that is independent of Lipper. Only those CIFSC groups of ten or more unique funds will claim a Lipper Fund Award, and only those CIFSC groups of five or more unique ETFs (each of whom have a minimum of three years of performance history) will claim a Lipper ETF Award.
9. The Lipper Awards are based on a proprietary rating methodology prepared by Lipper, the Lipper Leader Rating System. The Lipper Leader Rating System is a toolkit that uses investor-centred criteria to deliver a simple, clear description of a fund's success in meeting certain goals, such as preserving capital, lowering expenses or building wealth. Lipper Ratings provide an instant measure of a fund’s success against a specific set of key metrics, and can be useful to investors in identifying funds that meet particular characteristics.
10. In Canada, the Lipper Leader Rating System includes Lipper Leader ratings for Consistent Return (reflecting funds’ historical risk-adjusted returns relative to funds in the same classification), for Total Return (reflecting funds’ historical total return performance relative to funds in the same classification) and for Preservation (reflecting funds’ historical loss avoidance relative to other funds in the same classification). In each case, the categories for fund classification used by Lipper for the Lipper Leader ratings are those maintained by CIFSC (or a successor to the CIFSC). Lipper Leader ratings are measured monthly over 36, 60 and 120 month periods, and an overall rating is also measured, which is an un-weighted average of the previous three periods. The highest 20% of funds in each category are named
November 27, 2014 (2014), 37 OSCB 10425
Decisions, Orders and Rulings
Lipper Leaders for that particular rating and receive a score of 5, the next 20% receive a score of 4, the middle 20% are scored 3, the next 20% are scored 2 and the lowest 20% are scored 1.
11. The Lipper Awards, awarded annually in Canada, are based on the Lipper Ratings for Consistent Return measure, which, as generally described above, is a risk-adjusted mutual fund return performance measure used by Lipper that takes into account both short- and long-term risk-adjusted performance relative to fund classification, together with a measure of a fund’s consistency. In respect of the Lipper Awards for Canada, the Lipper Ratings for Consistent Return are measured over the 36, 60 and 120 month periods ending at the end of July of each year. As noted above, the highest 20% of funds in each classification are named Lipper Leaders for Consistent Return, and the highest Lipper Leader for Consistent Return in each applicable fund classification over these periods (currently, in the case of the Lipper ETF Awards, over the 36 month period only) wins a Lipper Award.
12. When a Fund is awarded a Lipper Award, it may make reference to the award in sales communications subject to the terms of a license agreement with Lipper.
13. The Lipper Leader ratings are performance ratings or rankings under NI 81-102 and Lipper Awards for Funds may be considered to be performance ratings or rankings given that the awards are based on the Lipper Leader ratings as described above. Therefore, references to Lipper Leader ratings and Lipper Awards in sales communications relating to the Funds need to meet the applicable requirements in Part 15 of NI 81-102.
14. Section 15.3(4)(c) of NI 81-102 imposes a “matching” requirement for performance ratings or rankings that are included in sales communications for funds. If a performance rating or ranking is referred to in a sales communication, the performance rating or ranking must be provided for, or “match”, each period for which standard performance data is required to be given for the fund except the period since the inception of the fund (i.e., for one, three, five and ten year periods, as applicable).
15. In Canada and elsewhere, Lipper Leader ratings are calculated only for 36, 60 and 120 month periods and are not calculated for a one year period. This means that a sales communication referencing a Lipper Leader rating cannot comply with the “matching” requirement contained in section 15.3(4)(c) of NI 81-102 because a rating is not available for the one year period. Relief from section 15.3(4)(c) of NI 81-102 is therefore required in order for Funds to reference Lipper Leader ratings in sales communications.
16. In addition, a sales communication referencing the overall Lipper Leader ratings and the Lipper Awards, which are based on the Lipper Leader ratings, must disclose the corresponding Lipper Leader rating for each period for which standard performance data is required to be given. As noted above, because a rating for the one year period is not available for the Lipper Leader ratings, sales communications referencing the overall Lipper Leader ratings or Lipper Awards also cannot comply with the matching requirement contained in section 15.3(4)(c) of NI 81-102.
17. The exemption in section 15.3(4.1) of NI 81-102 for references to overall ratings or rankings of funds cannot be relied upon to reference the overall Lipper Leader ratings or Lipper Awards in sales communications for the Funds because section 15.3(4.1) is available only if a sales communication “otherwise complies” with the requirements of section 15.3(4). As noted above, sales communications referencing the overall Lipper Leader ratings or Lipper Awards cannot comply with the matching requirement in section 15.3(4) because the underlying Lipper Leader ratings are not available for the one year period, rendering the exemption in section 15.3(4.1) unavailable. Relief from section 15.3(4)(c) is therefore required in order for Funds to reference overall Lipper Leader ratings and the Lipper Awards in sales communications.
18. Section 15.3(4)(f) of NI 81-102 imposes certain restrictions on disclosure in sales communications. The section provides that in order for a rating or ranking such as a Lipper Award to be used in an advertisement, the advertisement must be published within 45 days of the calendar month end to which the rating or ranking applies. Further, in order for the rating or ranking to be used in any other sales communication, the rating or ranking must be published within three months of the calendar month end to which the rating or ranking applies.
19. Because the evaluation of funds for the Lipper Awards will be based on data aggregated until the end of July in any given year and the results will be published in November of that year, by the time a Fund receives an award in November, section 15.3(4)(f) of NI 81-102 will prohibit it from publishing news of the award altogether.
20. The Exemption Sought is required in order for Lipper Leader ratings and Lipper Awards to be referenced in sales communications relating to the Funds.
21. The Filer submits that the Lipper Awards provide an important tool for investors, as they provide investors with context when evaluating investment choices. The Filer submits that the nature of the Lipper Leader ratings and Lipper Awards alleviates any concern that references to the ratings and awards may be misleading and therefore contrary to section
November 27, 2014 (2014), 37 OSCB 10426
Decisions, Orders and Rulings
15.2(1)(a) of NI 81-102. The Lipper Leader Rating System underlying the Lipper Leader ratings and Lipper Awards ensures an objective, transparent and quantitative measure of performance that is based on the expertise of Lipper in fund analysis.
Decision
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator under the Legislation is that the Exemption Sought is granted to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to a Fund provided that:
1. the sales communication that refers to the Lipper Award and Lipper Leader ratings complies with Part 15 of NI 81-102 other than as set out herein and contains the following disclosure in at least 10 point type:
(a) the name of the category for which the Fund has received the award or rating;
(b) the number of mutual funds in the category for the applicable period;
(c) the name of the ranking entity, i.e., Lipper;
(d) the length of period and the ending date, or, the first day of the period and the ending date on which the Lipper Award or Lipper Leader rating is based;
(e) a statement that Lipper Leader ratings are subject to change every month;
(f) in the case of a Lipper Award, a brief overview of the Lipper Awards;
(g) in the case of a Lipper Leader rating (other than Lipper Leader ratings referenced in connection with a Lipper Award), a brief overview of the Lipper Leader rating;
(h) where Lipper Awards are referenced, the corresponding Lipper Leader rating that the Lipper Award is derived from is presented for each period for which standard performance data is required other than the one year and since inception periods;
(i) where a Lipper Leader rating is referenced, the Lipper Leader ratings are presented for each period for which standard performance data is required other than the one year and since inception periods;
(j) disclosure of the meaning of the Lipper Leader ratings from 1 to 5 (e.g., ranking of 5 indicates a fund is in the top 20% of its category);
(k) reference to Lipper’s website (www.lipperweb.com) for greater detail on the Lipper Awards and Lipper Leader ratings;
2. the Lipper Awards being referenced must not have been awarded more than 365 days before the date of the sales communication; and
3. the Lipper Awards and Lipper Leader ratings being referenced are calculated based on comparisons of performance of investment funds within a specified category established by the CIFSC (or a successor to the CIFSC).
“Vera Nunes” Manager, Investment Funds and Structured Products Ontario Securities Commission
November 27, 2014 (2014), 37 OSCB 10427
Decisions, Orders and Rulings
2.1.21 MD Physician Services Inc.
Headnote
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions – Existing and future mutual funds managed by the Filer granted relief from paragraphs 15.3(4)(c) and (f) of NI 81-102 Investment Funds to permit references to Lipper Leader ratings and Lipper Awards in sales communications – Relief subject to conditions requiring specified disclosure and the requirement that the Lipper Awards being referenced not have been awarded more than 365 days before the date of the sales communication.
Applicable Legislative Provisions
National Instrument 81-102 Investment Funds, ss. 15.3(4)(c) and (f), 19.1.
November 3, 2014
IN THE MATTER OF THE SECURITIES LEGISLATION OF ONTARIO (the Jurisdiction)
AND
IN THE MATTER OF THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS IN MULTIPLE JURISDICTIONS
AND
IN THE MATTER OF MD PHYSICIAN SERVICES INC.
DECISION
Background
The principal regulator in the Jurisdiction has received an application from MD Physician Services Inc. (the Filer) on behalf of existing mutual funds and future mutual funds of which the Filer is or becomes the investment fund manager (or of which an affiliate of the Filer becomes the investment fund manager) and to which National Instrument 81-102 Investment Funds (NI 81- 102) applies (each a Fund and collectively, the Funds) for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) for an exemption from the requirements set out in sections 15.3(4)(c) and 15.3(4)(f) of NI 81-102, which provide that a sales communication must not refer to a performance rating or ranking of a mutual fund or asset allocation service unless:
(i) the rating or ranking is provided for each period for which standard performance data is required to be given, except the period since the inception of the mutual fund
(ii) the rating or ranking is to the same calendar month end that is:
(a) not more than 45 days before the date of the appearance or use of the advertisement in which it is included, and
(b) not more than three months before the date of first publication of any other sales communication in which it is included
(together, the Exemption Sought), to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to the Funds.
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission is the principal regulator for this application, and
November 27, 2014 (2014), 37 OSCB 10428
Decisions, Orders and Rulings
(b) the Filer has provided notice that section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in each of the other provinces and territories of Canada (together with Ontario, the Jurisdictions).
Interpretation
Terms defined in National Instrument 14-101 Definitions, MI 11-102 and NI 81-102 have the same meaning if used in this decision, unless otherwise defined.
Representations
This decision is based on the following facts represented by the Filer:
1. The Filer is the investment fund manager of the Funds and is registered as an investment fund manager in one or more of the Jurisdictions. The head office of the Filer is located in Ontario.
2. Each of the Funds is, or will be, an open-ended mutual fund established under the laws of Canada or a jurisdiction of Canada. The securities of each of the Funds are, or will be, qualified for distribution pursuant to a prospectus that has been, or will be, prepared and filed in accordance with the securities legislation of each applicable Jurisdiction. Each of the Funds is, or will be, a reporting issuer in one or more of the Jurisdictions. Each of the Funds is or will be subject to NI 81-102, including Part 15 of NI 81-102, which governs sales communications.
3. The Filer and the Funds are not in default of the securities legislation in any of the Jurisdictions.
4. The Filer wishes to include in sales communications of the Funds references to Lipper Leader ratings and Lipper Awards (where such Funds have been awarded a Lipper Award).
5. Lipper, Inc. (Lipper) is a company that is not a member of the organization of the Funds. Lipper is part of the Thomson Reuters group of companies, and is a global leader in supplying mutual fund information, analytical tools, and commentary. Lipper's fund data and analysis, fund awards designations and ratings information provide valuable insight to advisors, media and individual investors.
6. One of Lipper’s programs is the Lipper awards program. This program highlights funds that have excelled in delivering consistently strong risk-adjusted performance relative to peers and also recognizes fund families with high average scores for all funds within a particular asset class or overall. Currently the Lipper awards take place in approximately 13 countries.
7. In Canada, the Lipper Awards include the Lipper Fund Awards and Lipper ETF Awards (which will be awarded for the first time in Canada in 2014). For the Lipper Fund Awards, Lipper designates award-winning funds in most individual fund classifications for three, five and ten year periods. For the Lipper ETF Awards, Lipper will designate award- winning funds in a number of individual fund classifications for the three year period, and it is expected that awards for the five and ten year periods will be given in the future.
8. The categories for fund classification used by Lipper for the Lipper Awards in respect of Canadian funds are those maintained by the Canadian Investment Funds Standards Committee (CIFSC) (or a successor to the CIFSC), a Canadian organization that is independent of Lipper. Only those CIFSC groups of ten or more unique funds will claim a Lipper Fund Award, and only those CIFSC groups of five or more unique ETFs (each of whom have a minimum of three years of performance history) will claim a Lipper ETF Award.
9. The Lipper Awards are based on a proprietary rating methodology prepared by Lipper, the Lipper Leader Rating System. The Lipper Leader Rating System is a toolkit that uses investor-centred criteria to deliver a simple, clear description of a fund's success in meeting certain goals, such as preserving capital, lowering expenses or building wealth. Lipper Ratings provide an instant measure of a fund’s success against a specific set of key metrics, and can be useful to investors in identifying funds that meet particular characteristics.
10. In Canada, the Lipper Leader Rating System includes Lipper Leader ratings for Consistent Return (reflecting funds’ historical risk-adjusted returns relative to funds in the same classification), for Total Return (reflecting funds’ historical total return performance relative to funds in the same classification) and for Preservation (reflecting funds’ historical loss avoidance relative to other funds in the same classification). In each case, the categories for fund classification used by Lipper for the Lipper Leader ratings are those maintained by CIFSC (or a successor to the CIFSC). Lipper Leader ratings are measured monthly over 36, 60 and 120 month periods, and an overall rating is also measured, which is an un-weighted average of the previous three periods. The highest 20% of funds in each category are named
November 27, 2014 (2014), 37 OSCB 10429
Decisions, Orders and Rulings
Lipper Leaders for that particular rating and receive a score of 5, the next 20% receive a score of 4, the middle 20% are scored 3, the next 20% are scored 2 and the lowest 20% are scored 1.
11. The Lipper Awards, awarded annually in Canada, are based on the Lipper Ratings for Consistent Return measure, which, as generally described above, is a risk-adjusted mutual fund return performance measure used by Lipper that takes into account both short- and long-term risk-adjusted performance relative to fund classification, together with a measure of a fund’s consistency. In respect of the Lipper Awards for Canada, the Lipper Ratings for Consistent Return are measured over the 36, 60 and 120 month periods ending at the end of July of each year. As noted above, the highest 20% of funds in each classification are named Lipper Leaders for Consistent Return, and the highest Lipper Leader for Consistent Return in each applicable fund classification over these periods (currently, in the case of the Lipper ETF Awards, over the 36 month period only) wins a Lipper Award.
12. When a Fund is awarded a Lipper Award, it may make reference to the award in sales communications subject to the terms of a license agreement with Lipper.
13. The Lipper Leader ratings are performance ratings or rankings under NI 81-102 and Lipper Awards for Funds may be considered to be performance ratings or rankings given that the awards are based on the Lipper Leader ratings as described above. Therefore, references to Lipper Leader ratings and Lipper Awards in sales communications relating to the Funds need to meet the applicable requirements in Part 15 of NI 81-102.
14. Section 15.3(4)(c) of NI 81-102 imposes a “matching” requirement for performance ratings or rankings that are included in sales communications for funds. If a performance rating or ranking is referred to in a sales communication, the performance rating or ranking must be provided for, or “match”, each period for which standard performance data is required to be given for the fund except the period since the inception of the fund (i.e., for one, three, five and ten year periods, as applicable).
15. In Canada and elsewhere, Lipper Leader ratings are calculated only for 36, 60 and 120 month periods and are not calculated for a one year period. This means that a sales communication referencing a Lipper Leader rating cannot comply with the “matching” requirement contained in section 15.3(4)(c) of NI 81-102 because a rating is not available for the one year period. Relief from section 15.3(4)(c) of NI 81-102 is therefore required in order for Funds to reference Lipper Leader ratings in sales communications.
16. In addition, a sales communication referencing the overall Lipper Leader ratings and the Lipper Awards, which are based on the Lipper Leader ratings, must disclose the corresponding Lipper Leader rating for each period for which standard performance data is required to be given. As noted above, because a rating for the one year period is not available for the Lipper Leader ratings, sales communications referencing the overall Lipper Leader ratings or Lipper Awards also cannot comply with the matching requirement contained in section 15.3(4)(c) of NI 81-102.
17. The exemption in section 15.3(4.1) of NI 81-102 for references to overall ratings or rankings of funds cannot be relied upon to reference the overall Lipper Leader ratings or Lipper Awards in sales communications for the Funds because section 15.3(4.1) is available only if a sales communication “otherwise complies” with the requirements of section 15.3(4). As noted above, sales communications referencing the overall Lipper Leader ratings or Lipper Awards cannot comply with the matching requirement in section 15.3(4) because the underlying Lipper Leader ratings are not available for the one year period, rendering the exemption in section 15.3(4.1) unavailable. Relief from section 15.3(4)(c) is therefore required in order for Funds to reference overall Lipper Leader ratings and the Lipper Awards in sales communications.
18. Section 15.3(4)(f) of NI 81-102 imposes certain restrictions on disclosure in sales communications. The section provides that in order for a rating or ranking such as a Lipper Award to be used in an advertisement, the advertisement must be published within 45 days of the calendar month end to which the rating or ranking applies. Further, in order for the rating or ranking to be used in any other sales communication, the rating or ranking must be published within three months of the calendar month end to which the rating or ranking applies.
19. Because the evaluation of funds for the Lipper Awards will be based on data aggregated until the end of July in any given year and the results will be published in November of that year, by the time a Fund receives an award in November, section 15.3(4)(f) of NI 81-102 will prohibit it from publishing news of the award altogether.
20. The Exemption Sought is required in order for Lipper Leader ratings and Lipper Awards to be referenced in sales communications relating to the Funds.
21. The Filer submits that the Lipper Awards provide an important tool for investors, as they provide investors with context when evaluating investment choices. The Filer submits that the nature of the Lipper Leader ratings and Lipper Awards alleviates any concern that references to the ratings and awards may be misleading and therefore contrary to section
November 27, 2014 (2014), 37 OSCB 10430
Decisions, Orders and Rulings
15.2(1)(a) of NI 81-102. The Lipper Leader Rating System underlying the Lipper Leader ratings and Lipper Awards ensures an objective, transparent and quantitative measure of performance that is based on the expertise of Lipper in fund analysis.
Decision
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator under the Legislation is that the Exemption Sought is granted to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to a Fund provided that:
1. the sales communication that refers to the Lipper Award and Lipper Leader ratings complies with Part 15 of NI 81-102 other than as set out herein and contains the following disclosure in at least 10 point type:
(a) the name of the category for which the Fund has received the award or rating;
(b) the number of mutual funds in the category for the applicable period;
(c) the name of the ranking entity, i.e., Lipper;
(d) the length of period and the ending date, or, the first day of the period and the ending date on which the Lipper Award or Lipper Leader rating is based;
(e) a statement that Lipper Leader ratings are subject to change every month;
(f) in the case of a Lipper Award, a brief overview of the Lipper Awards;
(g) in the case of a Lipper Leader rating (other than Lipper Leader ratings referenced in connection with a Lipper Award), a brief overview of the Lipper Leader rating;
(h) where Lipper Awards are referenced, the corresponding Lipper Leader rating that the Lipper Award is derived from is presented for each period for which standard performance data is required other than the one year and since inception periods;
(i) where a Lipper Leader rating is referenced, the Lipper Leader ratings are presented for each period for which standard performance data is required other than the one year and since inception periods;
(j) disclosure of the meaning of the Lipper Leader ratings from 1 to 5 (e.g., ranking of 5 indicates a fund is in the top 20% of its category);
(k) reference to Lipper’s website (www.lipperweb.com) for greater detail on the Lipper Awards and Lipper Leader ratings;
2. the Lipper Awards being referenced must not have been awarded more than 365 days before the date of the sales communication; and
3. the Lipper Awards and Lipper Leader ratings being referenced are calculated based on comparisons of performance of investment funds within a specified category established by the CIFSC (or a successor to the CIFSC).
“Vera Nunes” Manager, Investment Funds and Structured Products Ontario Securities Commission
November 27, 2014 (2014), 37 OSCB 10431
Decisions, Orders and Rulings
2.1.22 RBC Global Asset Management Inc.
Headnote
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions – Existing and future mutual funds managed by the Filer granted relief from paragraphs 15.3(4)(c) and (f) of NI 81-102 Investment Funds to permit references to Lipper Leader ratings and Lipper Awards in sales communications – Relief subject to conditions requiring specified disclosure and the requirement that the Lipper Awards being referenced not have been awarded more than 365 days before the date of the sales communication.
Applicable Legislative Provisions
National Instrument 81-102 Investment Funds, ss. 15.3(4)(c) and (f), 19.1.
November 3, 2014
IN THE MATTER OF THE SECURITIES LEGISLATION OF ONTARIO (the Jurisdiction)
AND
IN THE MATTER OF THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS IN MULTIPLE JURISDICTIONS
AND
IN THE MATTER OF RBC GLOBAL ASSET MANAGEMENT INC.
DECISION
Background
The principal regulator in the Jurisdiction has received an application from RBC Global Asset Management Inc. (the Filer) on behalf of existing mutual funds and future mutual funds of which the Filer is or becomes the investment fund manager (or of which an affiliate of the Filer becomes the investment fund manager) and to which National Instrument 81-102 Investment Funds (NI 81-102) applies (each a Fund and collectively, the Funds) for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) for an exemption from the requirements set out in sections 15.3(4)(c) and 15.3(4)(f) of NI 81-102, which provide that a sales communication must not refer to a performance rating or ranking of a mutual fund or asset allocation service unless:
(i) the rating or ranking is provided for each period for which standard performance data is required to be given, except the period since the inception of the mutual fund
(ii) the rating or ranking is to the same calendar month end that is:
(a) not more than 45 days before the date of the appearance or use of the advertisement in which it is included, and
(b) not more than three months before the date of first publication of any other sales communication in which it is included
(together, the Exemption Sought), to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to the Funds.
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission is the principal regulator for this application, and
November 27, 2014 (2014), 37 OSCB 10432
Decisions, Orders and Rulings
(b) the Filer has provided notice that section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in each of the other provinces and territories of Canada (together with Ontario, the Jurisdictions).
Interpretation
Terms defined in National Instrument 14-101 Definitions, MI 11-102 and NI 81-102 have the same meaning if used in this decision, unless otherwise defined.
Representations
This decision is based on the following facts represented by the Filer:
1. The Filer is the investment fund manager of the Funds and is registered as an investment fund manager in one or more of the Jurisdictions. The head office of the Filer is located in Ontario.
2. Each of the Funds is, or will be, an open-ended mutual fund established under the laws of Canada or a jurisdiction of Canada. The securities of each of the Funds are, or will be, qualified for distribution pursuant to a prospectus that has been, or will be, prepared and filed in accordance with the securities legislation of each applicable Jurisdiction. Each of the Funds is, or will be, a reporting issuer in one or more of the Jurisdictions. Each of the Funds is or will be subject to NI 81-102, including Part 15 of NI 81-102, which governs sales communications.
3. The Filer and the Funds are not in default of the securities legislation in any of the Jurisdictions.
4. The Filer wishes to include in sales communications of the Funds references to Lipper Leader ratings and Lipper Awards (where such Funds have been awarded a Lipper Award).
5. Lipper, Inc. (Lipper) is a company that is not a member of the organization of the Funds. Lipper is part of the Thomson Reuters group of companies, and is a global leader in supplying mutual fund information, analytical tools, and commentary. Lipper's fund data and analysis, fund awards designations and ratings information provide valuable insight to advisors, media and individual investors.
6. One of Lipper’s programs is the Lipper awards program. This program highlights funds that have excelled in delivering consistently strong risk-adjusted performance relative to peers and also recognizes fund families with high average scores for all funds within a particular asset class or overall. Currently the Lipper awards take place in approximately 13 countries.
7. In Canada, the Lipper Awards include the Lipper Fund Awards and Lipper ETF Awards (which will be awarded for the first time in Canada in 2014). For the Lipper Fund Awards, Lipper designates award-winning funds in most individual fund classifications for three, five and ten year periods. For the Lipper ETF Awards, Lipper will designate award- winning funds in a number of individual fund classifications for the three year period, and it is expected that awards for the five and ten year periods will be given in the future.
8. The categories for fund classification used by Lipper for the Lipper Awards in respect of Canadian funds are those maintained by the Canadian Investment Funds Standards Committee (CIFSC) (or a successor to the CIFSC), a Canadian organization that is independent of Lipper. Only those CIFSC groups of ten or more unique funds will claim a Lipper Fund Award, and only those CIFSC groups of five or more unique ETFs (each of whom have a minimum of three years of performance history) will claim a Lipper ETF Award.
9. The Lipper Awards are based on a proprietary rating methodology prepared by Lipper, the Lipper Leader Rating System. The Lipper Leader Rating System is a toolkit that uses investor-centred criteria to deliver a simple, clear description of a fund's success in meeting certain goals, such as preserving capital, lowering expenses or building wealth. Lipper Ratings provide an instant measure of a fund’s success against a specific set of key metrics, and can be useful to investors in identifying funds that meet particular characteristics.
10. In Canada, the Lipper Leader Rating System includes Lipper Leader ratings for Consistent Return (reflecting funds’ historical risk-adjusted returns relative to funds in the same classification), for Total Return (reflecting funds’ historical total return performance relative to funds in the same classification) and for Preservation (reflecting funds’ historical loss avoidance relative to other funds in the same classification). In each case, the categories for fund classification used by Lipper for the Lipper Leader ratings are those maintained by CIFSC (or a successor to the CIFSC). Lipper Leader ratings are measured monthly over 36, 60 and 120 month periods, and an overall rating is also measured, which is an un-weighted average of the previous three periods. The highest 20% of funds in each category are named
November 27, 2014 (2014), 37 OSCB 10433
Decisions, Orders and Rulings
Lipper Leaders for that particular rating and receive a score of 5, the next 20% receive a score of 4, the middle 20% are scored 3, the next 20% are scored 2 and the lowest 20% are scored 1.
11. The Lipper Awards, awarded annually in Canada, are based on the Lipper Ratings for Consistent Return measure, which, as generally described above, is a risk-adjusted mutual fund return performance measure used by Lipper that takes into account both short- and long-term risk-adjusted performance relative to fund classification, together with a measure of a fund’s consistency. In respect of the Lipper Awards for Canada, the Lipper Ratings for Consistent Return are measured over the 36, 60 and 120 month periods ending at the end of July of each year. As noted above, the highest 20% of funds in each classification are named Lipper Leaders for Consistent Return, and the highest Lipper Leader for Consistent Return in each applicable fund classification over these periods (currently, in the case of the Lipper ETF Awards, over the 36 month period only) wins a Lipper Award.
12. When a Fund is awarded a Lipper Award, it may make reference to the award in sales communications subject to the terms of a license agreement with Lipper.
13. The Lipper Leader ratings are performance ratings or rankings under NI 81-102 and Lipper Awards for Funds may be considered to be performance ratings or rankings given that the awards are based on the Lipper Leader ratings as described above. Therefore, references to Lipper Leader ratings and Lipper Awards in sales communications relating to the Funds need to meet the applicable requirements in Part 15 of NI 81-102.
14. Section 15.3(4)(c) of NI 81-102 imposes a “matching” requirement for performance ratings or rankings that are included in sales communications for funds. If a performance rating or ranking is referred to in a sales communication, the performance rating or ranking must be provided for, or “match”, each period for which standard performance data is required to be given for the fund except the period since the inception of the fund (i.e., for one, three, five and ten year periods, as applicable).
15. In Canada and elsewhere, Lipper Leader ratings are calculated only for 36, 60 and 120 month periods and are not calculated for a one year period. This means that a sales communication referencing a Lipper Leader rating cannot comply with the “matching” requirement contained in section 15.3(4)(c) of NI 81-102 because a rating is not available for the one year period. Relief from section 15.3(4)(c) of NI 81-102 is therefore required in order for Funds to reference Lipper Leader ratings in sales communications.
16. In addition, a sales communication referencing the overall Lipper Leader ratings and the Lipper Awards, which are based on the Lipper Leader ratings, must disclose the corresponding Lipper Leader rating for each period for which standard performance data is required to be given. As noted above, because a rating for the one year period is not available for the Lipper Leader ratings, sales communications referencing the overall Lipper Leader ratings or Lipper Awards also cannot comply with the matching requirement contained in section 15.3(4)(c) of NI 81-102.
17. The exemption in section 15.3(4.1) of NI 81-102 for references to overall ratings or rankings of funds cannot be relied upon to reference the overall Lipper Leader ratings or Lipper Awards in sales communications for the Funds because section 15.3(4.1) is available only if a sales communication “otherwise complies” with the requirements of section 15.3(4). As noted above, sales communications referencing the overall Lipper Leader ratings or Lipper Awards cannot comply with the matching requirement in section 15.3(4) because the underlying Lipper Leader ratings are not available for the one year period, rendering the exemption in section 15.3(4.1) unavailable. Relief from section 15.3(4)(c) is therefore required in order for Funds to reference overall Lipper Leader ratings and the Lipper Awards in sales communications.
18. Section 15.3(4)(f) of NI 81-102 imposes certain restrictions on disclosure in sales communications. The section provides that in order for a rating or ranking such as a Lipper Award to be used in an advertisement, the advertisement must be published within 45 days of the calendar month end to which the rating or ranking applies. Further, in order for the rating or ranking to be used in any other sales communication, the rating or ranking must be published within three months of the calendar month end to which the rating or ranking applies.
19. Because the evaluation of funds for the Lipper Awards will be based on data aggregated until the end of July in any given year and the results will be published in November of that year, by the time a Fund receives an award in November, section 15.3(4)(f) of NI 81-102 will prohibit it from publishing news of the award altogether.
20. The Exemption Sought is required in order for Lipper Leader ratings and Lipper Awards to be referenced in sales communications relating to the Funds.
21. The Filer submits that the Lipper Awards provide an important tool for investors, as they provide investors with context when evaluating investment choices. The Filer submits that the nature of the Lipper Leader ratings and Lipper Awards alleviates any concern that references to the ratings and awards may be misleading and therefore contrary to section
November 27, 2014 (2014), 37 OSCB 10434
Decisions, Orders and Rulings
15.2(1)(a) of NI 81-102. The Lipper Leader Rating System underlying the Lipper Leader ratings and Lipper Awards ensures an objective, transparent and quantitative measure of performance that is based on the expertise of Lipper in fund analysis.
Decision
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator under the Legislation is that the Exemption Sought is granted to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to a Fund provided that:
1. the sales communication that refers to the Lipper Award and Lipper Leader ratings complies with Part 15 of NI 81-102 other than as set out herein and contains the following disclosure in at least 10 point type:
(a) the name of the category for which the Fund has received the award or rating;
(b) the number of mutual funds in the category for the applicable period;
(c) the name of the ranking entity, i.e., Lipper;
(d) the length of period and the ending date, or, the first day of the period and the ending date on which the Lipper Award or Lipper Leader rating is based;
(e) a statement that Lipper Leader ratings are subject to change every month;
(f) in the case of a Lipper Award, a brief overview of the Lipper Awards;
(g) in the case of a Lipper Leader rating (other than Lipper Leader ratings referenced in connection with a Lipper Award), a brief overview of the Lipper Leader rating;
(h) where Lipper Awards are referenced, the corresponding Lipper Leader rating that the Lipper Award is derived from is presented for each period for which standard performance data is required other than the one year and since inception periods;
(i) where a Lipper Leader rating is referenced, the Lipper Leader ratings are presented for each period for which standard performance data is required other than the one year and since inception periods;
(j) disclosure of the meaning of the Lipper Leader ratings from 1 to 5 (e.g., ranking of 5 indicates a fund is in the top 20% of its category);
(k) reference to Lipper’s website (www.lipperweb.com) for greater detail on the Lipper Awards and Lipper Leader ratings;
2. the Lipper Awards being referenced must not have been awarded more than 365 days before the date of the sales communication; and
3. the Lipper Awards and Lipper Leader ratings being referenced are calculated based on comparisons of performance of investment funds within a specified category established by the CIFSC (or a successor to the CIFSC).
“Vera Nunes” Manager, Investment Funds and Structured Products Ontario Securities Commission
November 27, 2014 (2014), 37 OSCB 10435
Decisions, Orders and Rulings
2.1.23 Sentry Investments Inc.
Headnote
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions – Existing and future mutual funds managed by the Filer granted relief from paragraphs 15.3(4)(c) and (f) of NI 81-102 Investment Funds to permit references to Lipper Leader ratings and Lipper Awards in sales communications – Relief subject to conditions requiring specified disclosure and the requirement that the Lipper Awards being referenced not have been awarded more than 365 days before the date of the sales communication.
Applicable Legislative Provisions
National Instrument 81-102 Investment Funds, ss. 15.3(4)(c) and (f), 19.1.
November 3, 2014
IN THE MATTER OF THE SECURITIES LEGISLATION OF ONTARIO (the Jurisdiction)
AND
IN THE MATTER OF THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS IN MULTIPLE JURISDICTIONS
AND
IN THE MATTER OF SENTRY INVESTMENTS INC.
DECISION
Background
The principal regulator in the Jurisdiction has received an application from Sentry Investments Inc. (the Filer) on behalf of existing mutual funds and future mutual funds of which the Filer is or becomes the investment fund manager (or of which an affiliate of the Filer becomes the investment fund manager) and to which National Instrument 81-102 Investment Funds (NI 81- 102) applies (each a Fund and collectively, the Funds) for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) for an exemption from the requirements set out in sections 15.3(4)(c) and 15.3(4)(f) of NI 81-102, which provide that a sales communication must not refer to a performance rating or ranking of a mutual fund or asset allocation service unless:
(i) the rating or ranking is provided for each period for which standard performance data is required to be given, except the period since the inception of the mutual fund
(ii) the rating or ranking is to the same calendar month end that is:
(a) not more than 45 days before the date of the appearance or use of the advertisement in which it is included, and
(b) not more than three months before the date of first publication of any other sales communication in which it is included
(together, the Exemption Sought), to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to the Funds.
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission is the principal regulator for this application, and
November 27, 2014 (2014), 37 OSCB 10436
Decisions, Orders and Rulings
(b) the Filer has provided notice that section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in each of the other provinces and territories of Canada (together with Ontario, the Jurisdictions).
Interpretation
Terms defined in National Instrument 14-101 Definitions, MI 11-102 and NI 81-102 have the same meaning if used in this decision, unless otherwise defined.
Representations
This decision is based on the following facts represented by the Filer:
1. The Filer is the investment fund manager of the Funds and is registered as an investment fund manager in one or more of the Jurisdictions. The head office of the Filer is located in Ontario.
2. Each of the Funds is, or will be, an open-ended mutual fund established under the laws of Canada or a jurisdiction of Canada. The securities of each of the Funds are, or will be, qualified for distribution pursuant to a prospectus that has been, or will be, prepared and filed in accordance with the securities legislation of each applicable Jurisdiction. Each of the Funds is, or will be, a reporting issuer in one or more of the Jurisdictions. Each of the Funds is or will be subject to NI 81-102, including Part 15 of NI 81-102, which governs sales communications.
3. The Filer and the Funds are not in default of the securities legislation in any of the Jurisdictions.
4. The Filer wishes to include in sales communications of the Funds references to Lipper Leader ratings and Lipper Awards (where such Funds have been awarded a Lipper Award).
5. Lipper, Inc. (Lipper) is a company that is not a member of the organization of the Funds. Lipper is part of the Thomson Reuters group of companies, and is a global leader in supplying mutual fund information, analytical tools, and commentary. Lipper's fund data and analysis, fund awards designations and ratings information provide valuable insight to advisors, media and individual investors.
6. One of Lipper’s programs is the Lipper awards program. This program highlights funds that have excelled in delivering consistently strong risk-adjusted performance relative to peers and also recognizes fund families with high average scores for all funds within a particular asset class or overall. Currently the Lipper awards take place in approximately 13 countries.
7. In Canada, the Lipper Awards include the Lipper Fund Awards and Lipper ETF Awards (which will be awarded for the first time in Canada in 2014). For the Lipper Fund Awards, Lipper designates award-winning funds in most individual fund classifications for three, five and ten year periods. For the Lipper ETF Awards, Lipper will designate award- winning funds in a number of individual fund classifications for the three year period, and it is expected that awards for the five and ten year periods will be given in the future.
8. The categories for fund classification used by Lipper for the Lipper Awards in respect of Canadian funds are those maintained by the Canadian Investment Funds Standards Committee (CIFSC) (or a successor to the CIFSC), a Canadian organization that is independent of Lipper. Only those CIFSC groups of ten or more unique funds will claim a Lipper Fund Award, and only those CIFSC groups of five or more unique ETFs (each of whom have a minimum of three years of performance history) will claim a Lipper ETF Award.
9. The Lipper Awards are based on a proprietary rating methodology prepared by Lipper, the Lipper Leader Rating System. The Lipper Leader Rating System is a toolkit that uses investor-centred criteria to deliver a simple, clear description of a fund's success in meeting certain goals, such as preserving capital, lowering expenses or building wealth. Lipper Ratings provide an instant measure of a fund’s success against a specific set of key metrics, and can be useful to investors in identifying funds that meet particular characteristics.
10. In Canada, the Lipper Leader Rating System includes Lipper Leader ratings for Consistent Return (reflecting funds’ historical risk-adjusted returns relative to funds in the same classification), for Total Return (reflecting funds’ historical total return performance relative to funds in the same classification) and for Preservation (reflecting funds’ historical loss avoidance relative to other funds in the same classification). In each case, the categories for fund classification used by Lipper for the Lipper Leader ratings are those maintained by CIFSC (or a successor to the CIFSC). Lipper Leader ratings are measured monthly over 36, 60 and 120 month periods, and an overall rating is also measured, which is an un-weighted average of the previous three periods. The highest 20% of funds in each category are named
November 27, 2014 (2014), 37 OSCB 10437
Decisions, Orders and Rulings
Lipper Leaders for that particular rating and receive a score of 5, the next 20% receive a score of 4, the middle 20% are scored 3, the next 20% are scored 2 and the lowest 20% are scored 1.
11. The Lipper Awards, awarded annually in Canada, are based on the Lipper Ratings for Consistent Return measure, which, as generally described above, is a risk-adjusted mutual fund return performance measure used by Lipper that takes into account both short- and long-term risk-adjusted performance relative to fund classification, together with a measure of a fund’s consistency. In respect of the Lipper Awards for Canada, the Lipper Ratings for Consistent Return are measured over the 36, 60 and 120 month periods ending at the end of July of each year. As noted above, the highest 20% of funds in each classification are named Lipper Leaders for Consistent Return, and the highest Lipper Leader for Consistent Return in each applicable fund classification over these periods (currently, in the case of the Lipper ETF Awards, over the 36 month period only) wins a Lipper Award.
12. When a Fund is awarded a Lipper Award, it may make reference to the award in sales communications subject to the terms of a license agreement with Lipper.
13. The Lipper Leader ratings are performance ratings or rankings under NI 81-102 and Lipper Awards for Funds may be considered to be performance ratings or rankings given that the awards are based on the Lipper Leader ratings as described above. Therefore, references to Lipper Leader ratings and Lipper Awards in sales communications relating to the Funds need to meet the applicable requirements in Part 15 of NI 81-102.
14. Section 15.3(4)(c) of NI 81-102 imposes a “matching” requirement for performance ratings or rankings that are included in sales communications for funds. If a performance rating or ranking is referred to in a sales communication, the performance rating or ranking must be provided for, or “match”, each period for which standard performance data is required to be given for the fund except the period since the inception of the fund (i.e., for one, three, five and ten year periods, as applicable).
15. In Canada and elsewhere, Lipper Leader ratings are calculated only for 36, 60 and 120 month periods and are not calculated for a one year period. This means that a sales communication referencing a Lipper Leader rating cannot comply with the “matching” requirement contained in section 15.3(4)(c) of NI 81-102 because a rating is not available for the one year period. Relief from section 15.3(4)(c) of NI 81-102 is therefore required in order for Funds to reference Lipper Leader ratings in sales communications.
16. In addition, a sales communication referencing the overall Lipper Leader ratings and the Lipper Awards, which are based on the Lipper Leader ratings, must disclose the corresponding Lipper Leader rating for each period for which standard performance data is required to be given. As noted above, because a rating for the one year period is not available for the Lipper Leader ratings, sales communications referencing the overall Lipper Leader ratings or Lipper Awards also cannot comply with the matching requirement contained in section 15.3(4)(c) of NI 81-102.
17. The exemption in section 15.3(4.1) of NI 81-102 for references to overall ratings or rankings of funds cannot be relied upon to reference the overall Lipper Leader ratings or Lipper Awards in sales communications for the Funds because section 15.3(4.1) is available only if a sales communication “otherwise complies” with the requirements of section 15.3(4). As noted above, sales communications referencing the overall Lipper Leader ratings or Lipper Awards cannot comply with the matching requirement in section 15.3(4) because the underlying Lipper Leader ratings are not available for the one year period, rendering the exemption in section 15.3(4.1) unavailable. Relief from section 15.3(4)(c) is therefore required in order for Funds to reference overall Lipper Leader ratings and the Lipper Awards in sales communications.
18. Section 15.3(4)(f) of NI 81-102 imposes certain restrictions on disclosure in sales communications. The section provides that in order for a rating or ranking such as a Lipper Award to be used in an advertisement, the advertisement must be published within 45 days of the calendar month end to which the rating or ranking applies. Further, in order for the rating or ranking to be used in any other sales communication, the rating or ranking must be published within three months of the calendar month end to which the rating or ranking applies.
19. Because the evaluation of funds for the Lipper Awards will be based on data aggregated until the end of July in any given year and the results will be published in November of that year, by the time a Fund receives an award in November, section 15.3(4)(f) of NI 81-102 will prohibit it from publishing news of the award altogether.
20. The Exemption Sought is required in order for Lipper Leader ratings and Lipper Awards to be referenced in sales communications relating to the Funds.
21. The Filer submits that the Lipper Awards provide an important tool for investors, as they provide investors with context when evaluating investment choices. The Filer submits that the nature of the Lipper Leader ratings and Lipper Awards alleviates any concern that references to the ratings and awards may be misleading and therefore contrary to section
November 27, 2014 (2014), 37 OSCB 10438
Decisions, Orders and Rulings
15.2(1)(a) of NI 81-102. The Lipper Leader Rating System underlying the Lipper Leader ratings and Lipper Awards ensures an objective, transparent and quantitative measure of performance that is based on the expertise of Lipper in fund analysis.
Decision
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator under the Legislation is that the Exemption Sought is granted to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to a Fund provided that:
1. the sales communication that refers to the Lipper Award and Lipper Leader ratings complies with Part 15 of NI 81-102 other than as set out herein and contains the following disclosure in at least 10 point type:
(a) the name of the category for which the Fund has received the award or rating;
(b) the number of mutual funds in the category for the applicable period;
(c) the name of the ranking entity, i.e., Lipper;
(d) the length of period and the ending date, or, the first day of the period and the ending date on which the Lipper Award or Lipper Leader rating is based;
(e) a statement that Lipper Leader ratings are subject to change every month;
(f) in the case of a Lipper Award, a brief overview of the Lipper Awards;
(g) in the case of a Lipper Leader rating (other than Lipper Leader ratings referenced in connection with a Lipper Award), a brief overview of the Lipper Leader rating;
(h) where Lipper Awards are referenced, the corresponding Lipper Leader rating that the Lipper Award is derived from is presented for each period for which standard performance data is required other than the one year and since inception periods;
(i) where a Lipper Leader rating is referenced, the Lipper Leader ratings are presented for each period for which standard performance data is required other than the one year and since inception periods;
(j) disclosure of the meaning of the Lipper Leader ratings from 1 to 5 (e.g., ranking of 5 indicates a fund is in the top 20% of its category);
(k) reference to Lipper’s website (www.lipperweb.com) for greater detail on the Lipper Awards and Lipper Leader ratings;
2. the Lipper Awards being referenced must not have been awarded more than 365 days before the date of the sales communication; and
3. the Lipper Awards and Lipper Leader ratings being referenced are calculated based on comparisons of performance of investment funds within a specified category established by the CIFSC (or a successor to the CIFSC).
“Vera Nunes” Manager, Investment Funds and Structured Products Ontario Securities Commission
November 27, 2014 (2014), 37 OSCB 10439
Decisions, Orders and Rulings
2.1.24 TD Asset Management Inc.
Headnote
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions – Existing and future mutual funds managed by the Filer granted relief from paragraphs 15.3(4)(c) and (f) of NI 81-102 Investment Funds to permit references to Lipper Leader ratings and Lipper Awards in sales communications – Relief subject to conditions requiring specified disclosure and the requirement that the Lipper Awards being referenced not have been awarded more than 365 days before the date of the sales communication.
Applicable Legislative Provisions
National Instrument 81-102 Investment Funds, ss. 15.3(4)(c) and (f), 19.1.
November 3, 2014
IN THE MATTER OF THE SECURITIES LEGISLATION OF ONTARIO (the Jurisdiction)
AND
IN THE MATTER OF THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS IN MULTIPLE JURISDICTIONS
AND
IN THE MATTER OF TD ASSET MANAGEMENT INC.
DECISION
Background
The principal regulator in the Jurisdiction has received an application from TD Asset Management Inc. (the Filer) on behalf of existing mutual funds and future mutual funds of which the Filer is or becomes the investment fund manager (or of which an affiliate of the Filer becomes the investment fund manager) and to which National Instrument 81-102 Investment Funds (NI 81- 102) applies (each a Fund and collectively, the Funds) for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) for an exemption from the requirements set out in sections 15.3(4)(c) and 15.3(4)(f) of NI 81-102, which provide that a sales communication must not refer to a performance rating or ranking of a mutual fund or asset allocation service unless:
(i) the rating or ranking is provided for each period for which standard performance data is required to be given, except the period since the inception of the mutual fund
(ii) the rating or ranking is to the same calendar month end that is:
(a) not more than 45 days before the date of the appearance or use of the advertisement in which it is included, and
(b) not more than three months before the date of first publication of any other sales communication in which it is included
(together, the Exemption Sought), to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to the Funds.
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission is the principal regulator for this application, and
November 27, 2014 (2014), 37 OSCB 10440
Decisions, Orders and Rulings
(b) the Filer has provided notice that section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in each of the other provinces and territories of Canada (together with Ontario, the Jurisdictions).
Interpretation
Terms defined in National Instrument 14-101 Definitions, MI 11-102 and NI 81-102 have the same meaning if used in this decision, unless otherwise defined.
Representations
This decision is based on the following facts represented by the Filer:
1. The Filer is the investment fund manager of the Funds and is registered as an investment fund manager in one or more of the Jurisdictions. The head office of the Filer is located in Ontario.
2. Each of the Funds is, or will be, an open-ended mutual fund established under the laws of Canada or a jurisdiction of Canada. The securities of each of the Funds are, or will be, qualified for distribution pursuant to a prospectus that has been, or will be, prepared and filed in accordance with the securities legislation of each applicable Jurisdiction. Each of the Funds is, or will be, a reporting issuer in one or more of the Jurisdictions. Each of the Funds is or will be subject to NI 81-102, including Part 15 of NI 81-102, which governs sales communications.
3. The Filer and the Funds are not in default of the securities legislation in any of the Jurisdictions.
4. The Filer wishes to include in sales communications of the Funds references to Lipper Leader ratings and Lipper Awards (where such Funds have been awarded a Lipper Award).
5. Lipper, Inc. (Lipper) is a company that is not a member of the organization of the Funds. Lipper is part of the Thomson Reuters group of companies, and is a global leader in supplying mutual fund information, analytical tools, and commentary. Lipper's fund data and analysis, fund awards designations and ratings information provide valuable insight to advisors, media and individual investors.
6. One of Lipper’s programs is the Lipper awards program. This program highlights funds that have excelled in delivering consistently strong risk-adjusted performance relative to peers and also recognizes fund families with high average scores for all funds within a particular asset class or overall. Currently the Lipper awards take place in approximately 13 countries.
7. In Canada, the Lipper Awards include the Lipper Fund Awards and Lipper ETF Awards (which will be awarded for the first time in Canada in 2014). For the Lipper Fund Awards, Lipper designates award-winning funds in most individual fund classifications for three, five and ten year periods. For the Lipper ETF Awards, Lipper will designate award- winning funds in a number of individual fund classifications for the three year period, and it is expected that awards for the five and ten year periods will be given in the future.
8. The categories for fund classification used by Lipper for the Lipper Awards in respect of Canadian funds are those maintained by the Canadian Investment Funds Standards Committee (CIFSC) (or a successor to the CIFSC), a Canadian organization that is independent of Lipper. Only those CIFSC groups of ten or more unique funds will claim a Lipper Fund Award, and only those CIFSC groups of five or more unique ETFs (each of whom have a minimum of three years of performance history) will claim a Lipper ETF Award.
9. The Lipper Awards are based on a proprietary rating methodology prepared by Lipper, the Lipper Leader Rating System. The Lipper Leader Rating System is a toolkit that uses investor-centred criteria to deliver a simple, clear description of a fund's success in meeting certain goals, such as preserving capital, lowering expenses or building wealth. Lipper Ratings provide an instant measure of a fund’s success against a specific set of key metrics, and can be useful to investors in identifying funds that meet particular characteristics.
10. In Canada, the Lipper Leader Rating System includes Lipper Leader ratings for Consistent Return (reflecting funds’ historical risk-adjusted returns relative to funds in the same classification), for Total Return (reflecting funds’ historical total return performance relative to funds in the same classification) and for Preservation (reflecting funds’ historical loss avoidance relative to other funds in the same classification). In each case, the categories for fund classification used by Lipper for the Lipper Leader ratings are those maintained by CIFSC (or a successor to the CIFSC). Lipper Leader ratings are measured monthly over 36, 60 and 120 month periods, and an overall rating is also measured, which is an un-weighted average of the previous three periods. The highest 20% of funds in each category are named
November 27, 2014 (2014), 37 OSCB 10441
Decisions, Orders and Rulings
Lipper Leaders for that particular rating and receive a score of 5, the next 20% receive a score of 4, the middle 20% are scored 3, the next 20% are scored 2 and the lowest 20% are scored 1.
11. The Lipper Awards, awarded annually in Canada, are based on the Lipper Ratings for Consistent Return measure, which, as generally described above, is a risk-adjusted mutual fund return performance measure used by Lipper that takes into account both short- and long-term risk-adjusted performance relative to fund classification, together with a measure of a fund’s consistency. In respect of the Lipper Awards for Canada, the Lipper Ratings for Consistent Return are measured over the 36, 60 and 120 month periods ending at the end of July of each year. As noted above, the highest 20% of funds in each classification are named Lipper Leaders for Consistent Return, and the highest Lipper Leader for Consistent Return in each applicable fund classification over these periods (currently, in the case of the Lipper ETF Awards, over the 36 month period only) wins a Lipper Award.
12. When a Fund is awarded a Lipper Award, it may make reference to the award in sales communications subject to the terms of a license agreement with Lipper.
13. The Lipper Leader ratings are performance ratings or rankings under NI 81-102 and Lipper Awards for Funds may be considered to be performance ratings or rankings given that the awards are based on the Lipper Leader ratings as described above. Therefore, references to Lipper Leader ratings and Lipper Awards in sales communications relating to the Funds need to meet the applicable requirements in Part 15 of NI 81-102.
14. Section 15.3(4)(c) of NI 81-102 imposes a “matching” requirement for performance ratings or rankings that are included in sales communications for funds. If a performance rating or ranking is referred to in a sales communication, the performance rating or ranking must be provided for, or “match”, each period for which standard performance data is required to be given for the fund except the period since the inception of the fund (i.e., for one, three, five and ten year periods, as applicable).
15. In Canada and elsewhere, Lipper Leader ratings are calculated only for 36, 60 and 120 month periods and are not calculated for a one year period. This means that a sales communication referencing a Lipper Leader rating cannot comply with the “matching” requirement contained in section 15.3(4)(c) of NI 81-102 because a rating is not available for the one year period. Relief from section 15.3(4)(c) of NI 81-102 is therefore required in order for Funds to reference Lipper Leader ratings in sales communications.
16. In addition, a sales communication referencing the overall Lipper Leader ratings and the Lipper Awards, which are based on the Lipper Leader ratings, must disclose the corresponding Lipper Leader rating for each period for which standard performance data is required to be given. As noted above, because a rating for the one year period is not available for the Lipper Leader ratings, sales communications referencing the overall Lipper Leader ratings or Lipper Awards also cannot comply with the matching requirement contained in section 15.3(4)(c) of NI 81-102.
17. The exemption in section 15.3(4.1) of NI 81-102 for references to overall ratings or rankings of funds cannot be relied upon to reference the overall Lipper Leader ratings or Lipper Awards in sales communications for the Funds because section 15.3(4.1) is available only if a sales communication “otherwise complies” with the requirements of section 15.3(4). As noted above, sales communications referencing the overall Lipper Leader ratings or Lipper Awards cannot comply with the matching requirement in section 15.3(4) because the underlying Lipper Leader ratings are not available for the one year period, rendering the exemption in section 15.3(4.1) unavailable. Relief from section 15.3(4)(c) is therefore required in order for Funds to reference overall Lipper Leader ratings and the Lipper Awards in sales communications.
18. Section 15.3(4)(f) of NI 81-102 imposes certain restrictions on disclosure in sales communications. The section provides that in order for a rating or ranking such as a Lipper Award to be used in an advertisement, the advertisement must be published within 45 days of the calendar month end to which the rating or ranking applies. Further, in order for the rating or ranking to be used in any other sales communication, the rating or ranking must be published within three months of the calendar month end to which the rating or ranking applies.
19. Because the evaluation of funds for the Lipper Awards will be based on data aggregated until the end of July in any given year and the results will be published in November of that year, by the time a Fund receives an award in November, section 15.3(4)(f) of NI 81-102 will prohibit it from publishing news of the award altogether.
20. The Exemption Sought is required in order for Lipper Leader ratings and Lipper Awards to be referenced in sales communications relating to the Funds.
21. The Filer submits that the Lipper Awards provide an important tool for investors, as they provide investors with context when evaluating investment choices. The Filer submits that the nature of the Lipper Leader ratings and Lipper Awards alleviates any concern that references to the ratings and awards may be misleading and therefore contrary to section
November 27, 2014 (2014), 37 OSCB 10442
Decisions, Orders and Rulings
15.2(1)(a) of NI 81-102. The Lipper Leader Rating System underlying the Lipper Leader ratings and Lipper Awards ensures an objective, transparent and quantitative measure of performance that is based on the expertise of Lipper in fund analysis.
Decision
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator under the Legislation is that the Exemption Sought is granted to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to a Fund provided that:
1. the sales communication that refers to the Lipper Award and Lipper Leader ratings complies with Part 15 of NI 81-102 other than as set out herein and contains the following disclosure in at least 10 point type:
(a) the name of the category for which the Fund has received the award or rating;
(b) the number of mutual funds in the category for the applicable period;
(c) the name of the ranking entity, i.e., Lipper;
(d) the length of period and the ending date, or, the first day of the period and the ending date on which the Lipper Award or Lipper Leader rating is based;
(e) a statement that Lipper Leader ratings are subject to change every month;
(f) in the case of a Lipper Award, a brief overview of the Lipper Awards;
(g) in the case of a Lipper Leader rating (other than Lipper Leader ratings referenced in connection with a Lipper Award), a brief overview of the Lipper Leader rating;
(h) where Lipper Awards are referenced, the corresponding Lipper Leader rating that the Lipper Award is derived from is presented for each period for which standard performance data is required other than the one year and since inception periods;
(i) where a Lipper Leader rating is referenced, the Lipper Leader ratings are presented for each period for which standard performance data is required other than the one year and since inception periods;
(j) disclosure of the meaning of the Lipper Leader ratings from 1 to 5 (e.g., ranking of 5 indicates a fund is in the top 20% of its category);
(k) reference to Lipper’s website (www.lipperweb.com) for greater detail on the Lipper Awards and Lipper Leader ratings;
2. the Lipper Awards being referenced must not have been awarded more than 365 days before the date of the sales communication; and
3. the Lipper Awards and Lipper Leader ratings being referenced are calculated based on comparisons of performance of investment funds within a specified category established by the CIFSC (or a successor to the CIFSC).
“Vera Nunes” Manager, Investment Funds and Structured Products Ontario Securities Commission
November 27, 2014 (2014), 37 OSCB 10443
Decisions, Orders and Rulings
2.1.25 Vanguard Investments Canada Inc.
Headnote
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions – Existing and future mutual funds managed by the Filer granted relief from paragraphs 15.3(4)(c) and (f) of NI 81-102 Investment Funds to permit references to Lipper Leader ratings and Lipper Awards in sales communications – Relief subject to conditions requiring specified disclosure and the requirement that the Lipper Awards being referenced not have been awarded more than 365 days before the date of the sales communication.
Applicable Legislative Provisions
National Instrument 81-102 Investment Funds, ss. 15.3(4)(c) and (f), 19.1.
November 3, 2014
IN THE MATTER OF THE SECURITIES LEGISLATION OF ONTARIO (the Jurisdiction)
AND
IN THE MATTER OF THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS IN MULTIPLE JURISDICTIONS
AND
IN THE MATTER OF VANGUARD INVESTMENTS CANADA INC.
DECISION
Background
The principal regulator in the Jurisdiction has received an application from Vanguard Investments Canada Inc. (the Filer) on behalf of existing mutual funds and future mutual funds of which the Filer is or becomes the investment fund manager (or of which an affiliate of the Filer becomes the investment fund manager) and to which National Instrument 81-102 Investment Funds (NI 81-102) applies (each a Fund and collectively, the Funds) for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) for an exemption from the requirements set out in sections 15.3(4)(c) and 15.3(4)(f) of NI 81-102, which provide that a sales communication must not refer to a performance rating or ranking of a mutual fund or asset allocation service unless:
(i) the rating or ranking is provided for each period for which standard performance data is required to be given, except the period since the inception of the mutual fund
(ii) the rating or ranking is to the same calendar month end that is:
(a) not more than 45 days before the date of the appearance or use of the advertisement in which it is included, and
(b) not more than three months before the date of first publication of any other sales communication in which it is included
(together, the Exemption Sought), to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to the Funds.
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission is the principal regulator for this application, and
November 27, 2014 (2014), 37 OSCB 10444
Decisions, Orders and Rulings
(b) the Filer has provided notice that section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in each of the other provinces and territories of Canada (together with Ontario, the Jurisdictions).
Interpretation
Terms defined in National Instrument 14-101 Definitions, MI 11-102 and NI 81-102 have the same meaning if used in this decision, unless otherwise defined.
Representations
This decision is based on the following facts represented by the Filer:
1. The Filer is the investment fund manager of the Funds and is registered as an investment fund manager in one or more of the Jurisdictions. The head office of the Filer is located in Ontario.
2. Each of the Funds is, or will be, an open-ended mutual fund established under the laws of Canada or a jurisdiction of Canada. The securities of each of the Funds are, or will be, qualified for distribution pursuant to a prospectus that has been, or will be, prepared and filed in accordance with the securities legislation of each applicable Jurisdiction. Each of the Funds is, or will be, a reporting issuer in one or more of the Jurisdictions. Each of the Funds is or will be subject to NI 81-102, including Part 15 of NI 81-102, which governs sales communications.
3. The Filer and the Funds are not in default of the securities legislation in any of the Jurisdictions.
4. The Filer wishes to include in sales communications of the Funds references to Lipper Leader ratings and Lipper Awards (where such Funds have been awarded a Lipper Award).
5. Lipper, Inc. (Lipper) is a company that is not a member of the organization of the Funds. Lipper is part of the Thomson Reuters group of companies, and is a global leader in supplying mutual fund information, analytical tools, and commentary. Lipper's fund data and analysis, fund awards designations and ratings information provide valuable insight to advisors, media and individual investors.
6. One of Lipper’s programs is the Lipper awards program. This program highlights funds that have excelled in delivering consistently strong risk-adjusted performance relative to peers and also recognizes fund families with high average scores for all funds within a particular asset class or overall. Currently the Lipper awards take place in approximately 13 countries.
7. In Canada, the Lipper Awards include the Lipper Fund Awards and Lipper ETF Awards (which will be awarded for the first time in Canada in 2014). For the Lipper Fund Awards, Lipper designates award-winning funds in most individual fund classifications for three, five and ten year periods. For the Lipper ETF Awards, Lipper will designate award- winning funds in a number of individual fund classifications for the three year period, and it is expected that awards for the five and ten year periods will be given in the future.
8. The categories for fund classification used by Lipper for the Lipper Awards in respect of Canadian funds are those maintained by the Canadian Investment Funds Standards Committee (CIFSC) (or a successor to the CIFSC), a Canadian organization that is independent of Lipper. Only those CIFSC groups of ten or more unique funds will claim a Lipper Fund Award, and only those CIFSC groups of five or more unique ETFs (each of whom have a minimum of three years of performance history) will claim a Lipper ETF Award.
9. The Lipper Awards are based on a proprietary rating methodology prepared by Lipper, the Lipper Leader Rating System. The Lipper Leader Rating System is a toolkit that uses investor-centred criteria to deliver a simple, clear description of a fund's success in meeting certain goals, such as preserving capital, lowering expenses or building wealth. Lipper Ratings provide an instant measure of a fund’s success against a specific set of key metrics, and can be useful to investors in identifying funds that meet particular characteristics.
10. In Canada, the Lipper Leader Rating System includes Lipper Leader ratings for Consistent Return (reflecting funds’ historical risk-adjusted returns relative to funds in the same classification), for Total Return (reflecting funds’ historical total return performance relative to funds in the same classification) and for Preservation (reflecting funds’ historical loss avoidance relative to other funds in the same classification). In each case, the categories for fund classification used by Lipper for the Lipper Leader ratings are those maintained by CIFSC (or a successor to the CIFSC). Lipper Leader ratings are measured monthly over 36, 60 and 120 month periods, and an overall rating is also measured, which is an un-weighted average of the previous three periods. The highest 20% of funds in each category are named
November 27, 2014 (2014), 37 OSCB 10445
Decisions, Orders and Rulings
Lipper Leaders for that particular rating and receive a score of 5, the next 20% receive a score of 4, the middle 20% are scored 3, the next 20% are scored 2 and the lowest 20% are scored 1.
11. The Lipper Awards, awarded annually in Canada, are based on the Lipper Ratings for Consistent Return measure, which, as generally described above, is a risk-adjusted mutual fund return performance measure used by Lipper that takes into account both short- and long-term risk-adjusted performance relative to fund classification, together with a measure of a fund’s consistency. In respect of the Lipper Awards for Canada, the Lipper Ratings for Consistent Return are measured over the 36, 60 and 120 month periods ending at the end of July of each year. As noted above, the highest 20% of funds in each classification are named Lipper Leaders for Consistent Return, and the highest Lipper Leader for Consistent Return in each applicable fund classification over these periods (currently, in the case of the Lipper ETF Awards, over the 36 month period only) wins a Lipper Award.
12. When a Fund is awarded a Lipper Award, it may make reference to the award in sales communications subject to the terms of a license agreement with Lipper.
13. The Lipper Leader ratings are performance ratings or rankings under NI 81-102 and Lipper Awards for Funds may be considered to be performance ratings or rankings given that the awards are based on the Lipper Leader ratings as described above. Therefore, references to Lipper Leader ratings and Lipper Awards in sales communications relating to the Funds need to meet the applicable requirements in Part 15 of NI 81-102.
14. Section 15.3(4)(c) of NI 81-102 imposes a “matching” requirement for performance ratings or rankings that are included in sales communications for funds. If a performance rating or ranking is referred to in a sales communication, the performance rating or ranking must be provided for, or “match”, each period for which standard performance data is required to be given for the fund except the period since the inception of the fund (i.e., for one, three, five and ten year periods, as applicable).
15. In Canada and elsewhere, Lipper Leader ratings are calculated only for 36, 60 and 120 month periods and are not calculated for a one year period. This means that a sales communication referencing a Lipper Leader rating cannot comply with the “matching” requirement contained in section 15.3(4)(c) of NI 81-102 because a rating is not available for the one year period. Relief from section 15.3(4)(c) of NI 81-102 is therefore required in order for Funds to reference Lipper Leader ratings in sales communications.
16. In addition, a sales communication referencing the overall Lipper Leader ratings and the Lipper Awards, which are based on the Lipper Leader ratings, must disclose the corresponding Lipper Leader rating for each period for which standard performance data is required to be given. As noted above, because a rating for the one year period is not available for the Lipper Leader ratings, sales communications referencing the overall Lipper Leader ratings or Lipper Awards also cannot comply with the matching requirement contained in section 15.3(4)(c) of NI 81-102.
17. The exemption in section 15.3(4.1) of NI 81-102 for references to overall ratings or rankings of funds cannot be relied upon to reference the overall Lipper Leader ratings or Lipper Awards in sales communications for the Funds because section 15.3(4.1) is available only if a sales communication “otherwise complies” with the requirements of section 15.3(4). As noted above, sales communications referencing the overall Lipper Leader ratings or Lipper Awards cannot comply with the matching requirement in section 15.3(4) because the underlying Lipper Leader ratings are not available for the one year period, rendering the exemption in section 15.3(4.1) unavailable. Relief from section 15.3(4)(c) is therefore required in order for Funds to reference overall Lipper Leader ratings and the Lipper Awards in sales communications.
18. Section 15.3(4)(f) of NI 81-102 imposes certain restrictions on disclosure in sales communications. The section provides that in order for a rating or ranking such as a Lipper Award to be used in an advertisement, the advertisement must be published within 45 days of the calendar month end to which the rating or ranking applies. Further, in order for the rating or ranking to be used in any other sales communication, the rating or ranking must be published within three months of the calendar month end to which the rating or ranking applies.
19. Because the evaluation of funds for the Lipper Awards will be based on data aggregated until the end of July in any given year and the results will be published in November of that year, by the time a Fund receives an award in November, section 15.3(4)(f) of NI 81-102 will prohibit it from publishing news of the award altogether.
20. The Exemption Sought is required in order for Lipper Leader ratings and Lipper Awards to be referenced in sales communications relating to the Funds.
21. The Filer submits that the Lipper Awards provide an important tool for investors, as they provide investors with context when evaluating investment choices. The Filer submits that the nature of the Lipper Leader ratings and Lipper Awards alleviates any concern that references to the ratings and awards may be misleading and therefore contrary to section
November 27, 2014 (2014), 37 OSCB 10446
Decisions, Orders and Rulings
15.2(1)(a) of NI 81-102. The Lipper Leader Rating System underlying the Lipper Leader ratings and Lipper Awards ensures an objective, transparent and quantitative measure of performance that is based on the expertise of Lipper in fund analysis.
Decision
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator under the Legislation is that the Exemption Sought is granted to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to a Fund provided that:
1. the sales communication that refers to the Lipper Award and Lipper Leader ratings complies with Part 15 of NI 81-102 other than as set out herein and contains the following disclosure in at least 10 point type:
(a) the name of the category for which the Fund has received the award or rating;
(b) the number of mutual funds in the category for the applicable period;
(c) the name of the ranking entity, i.e., Lipper;
(d) the length of period and the ending date, or, the first day of the period and the ending date on which the Lipper Award or Lipper Leader rating is based;
(e) a statement that Lipper Leader ratings are subject to change every month;
(f) in the case of a Lipper Award, a brief overview of the Lipper Awards;
(g) in the case of a Lipper Leader rating (other than Lipper Leader ratings referenced in connection with a Lipper Award), a brief overview of the Lipper Leader rating;
(h) where Lipper Awards are referenced, the corresponding Lipper Leader rating that the Lipper Award is derived from is presented for each period for which standard performance data is required other than the one year and since inception periods;
(i) where a Lipper Leader rating is referenced, the Lipper Leader ratings are presented for each period for which standard performance data is required other than the one year and since inception periods;
(j) disclosure of the meaning of the Lipper Leader ratings from 1 to 5 (e.g., ranking of 5 indicates a fund is in the top 20% of its category);
(k) reference to Lipper’s website (www.lipperweb.com) for greater detail on the Lipper Awards and Lipper Leader ratings;
2. the Lipper Awards being referenced must not have been awarded more than 365 days before the date of the sales communication; and
3. the Lipper Awards and Lipper Leader ratings being referenced are calculated based on comparisons of performance of investment funds within a specified category established by the CIFSC (or a successor to the CIFSC).
“Vera Nunes” Manager, Investment Funds and Structured Products Ontario Securities Commission
November 27, 2014 (2014), 37 OSCB 10447
Decisions, Orders and Rulings
2.1.26 ATB Investment Management Inc. et al.
Headnote
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions – Existing and future mutual funds managed by the Filer granted relief from paragraphs 15.3(4)(c) and (f) of NI 81-102 Investment Funds to permit references to Lipper Leader ratings and Lipper Awards in sales communications – Relief subject to conditions requiring specified disclosure and the requirement that the Lipper Awards being referenced not have been awarded more than 365 days before the date of the sales communication.
Applicable Legislative Provisions
National Instrument 81-102 Investment Funds, ss. 15.3(4)(c) and (f), 19.1.
Citation: Re ATB Investment Management Inc., 2014 ABASC 435
November 4, 2011
IN THE MATTER OF THE SECURITIES LEGISLATION OF ALBERTA AND ONTARIO (the Jurisdictions)
AND
IN THE MATTER OF THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS IN MULTIPLE JURISDICTIONS
AND
IN THE MATTER OF ATB INVESTMENT MANAGEMENT INC., CANOE FINANCIAL LP, HESPERIAN CAPITAL MANAGEMENT LTD. AND MAWER INVESTMENT MANAGEMENT LTD. (each a Filer and collectively, the Filers)
DECISION
Background
The securities regulatory authority or regulator in each of the Jurisdictions (the Decision Maker) has received an application from the Filers on behalf of existing mutual funds and future mutual funds of which a Filer is or becomes the investment fund manager (or of which an affiliate of a Filer becomes the investment fund manager) and to which National Instrument 81-102 Investment Funds (NI 81-102) applies (each a Fund and collectively, the Funds) for a decision under the securities legislation of the Jurisdictions (the Legislation) for an exemption from the requirements set out in sections 15.3(4)(c) and 15.3(4)(f) of NI 81- 102, which provide that a sales communication must not refer to a performance rating or ranking of a mutual fund or asset allocation service unless:
(a) the rating or ranking is provided for each period for which standard performance data is required to be given, except the period since the inception of the mutual fund; and
(b) the rating or ranking is to the same calendar month end that is:
(i) not more than 45 days before the date of the appearance or use of the advertisement in which it is included; and
(ii) not more than three months before the date of first publication of any other sales communication in which it is included;
(together, the Exemption Sought), to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to the Funds.
November 27, 2014 (2014), 37 OSCB 10448
Decisions, Orders and Rulings
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a dual application):
(a) the Alberta Securities Commission is the principal regulator for this application;
(b) the Filers have provided notice that section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11- 102) is intended to be relied upon in each of the other provinces and territories of Canada; and
(c) this decision is the decision of the principal regulator and evidences the decision of the securities regulatory authority or regulator in Ontario.
Interpretation
Terms defined in National Instrument 14-101 Definitions, MI 11-102 and NI 81-102 have the same meaning if used in this decision, unless otherwise defined herein.
Representations
This decision is based on the following facts represented by the Filers:
1. Each Filer is the investment fund manager of the applicable Funds and is registered as an investment fund manager in one or more of the jurisdictions of Canada. The head office of each Filer is located in Alberta.
2. Each of the Funds is, or will be, an open-ended mutual fund established under the laws of Canada or a jurisdiction of Canada. Securities of each of the Funds are, or will be, qualified for distribution pursuant to a prospectus that has been, or will be, prepared and filed in accordance with the securities legislation of each applicable jurisdiction of Canada. Each of the Funds is, or will be, a reporting issuer in one or more of the jurisdictions of Canada. Each of the Funds is or will be subject to NI 81-102, including Part 15 of NI 81-102, which governs sales communications.
3. The Filers and the Funds are not in default of the securities legislation in any of the jurisdictions of Canada.
4. The Filers wish to include in sales communications of the Funds references to Lipper Leader ratings and Lipper Awards (where such Funds have been awarded a Lipper Award.)
5. Lipper, Inc. (Lipper) is a company that is not a member of the organization of the Funds. Lipper is part of the Thomson Reuters group of companies, and is a global leader in supplying mutual fund information, analytical tools, and commentary. Lipper's fund data and analysis, fund awards designations and ratings information provide valuable insight to advisors, media and individual investors.
6. One of Lipper’s programs is the Lipper awards program. This program highlights funds that have excelled in delivering consistently strong risk-adjusted performance relative to peers and also recognizes fund families with high average scores for all funds within a particular asset class or overall. Currently the Lipper awards take place in approximately 13 countries.
7. In Canada, the Lipper Awards include the Lipper Fund Awards and Lipper ETF Awards (which will be awarded for the first time in Canada in 2014). For the Lipper Fund Awards, Lipper designates award-winning funds in most individual fund classifications for three, five and ten year periods. For the Lipper ETF Awards, Lipper will designate award- winning funds in a number of individual fund classifications for the three year period, and it is expected that awards for the five and ten year periods will be given in the future.
8. The categories for fund classification used by Lipper for the Lipper Awards in respect of Canadian funds are those maintained by the Canadian Investment Funds Standards Committee (CIFSC) (or a successor to the CIFSC), a Canadian organization that is independent of Lipper. Only those CIFSC groups of ten or more unique funds will claim a Lipper Fund Award, and only those CIFSC groups of five or more unique ETFs (each of whom have a minimum of three years of performance history) will claim a Lipper ETF Award.
9. The Lipper Awards are based on a proprietary rating methodology prepared by Lipper, the Lipper Leader Rating System. The Lipper Leader Rating System is a toolkit that uses investor-centred criteria to deliver a simple, clear description of a fund's success in meeting certain goals, such as preserving capital, lowering expenses or building wealth. Lipper Ratings provide an instant measure of a fund’s success against a specific set of key metrics, and can be useful to investors in identifying funds that meet particular characteristics.
10. In Canada, the Lipper Leader Rating System includes Lipper Leader ratings for Consistent Return (reflecting funds’ historical risk-adjusted returns relative to funds in the same classification), for Total Return (reflecting funds’ historical
November 27, 2014 (2014), 37 OSCB 10449
Decisions, Orders and Rulings
total return performance relative to funds in the same classification) and for Preservation (reflecting funds’ historical loss avoidance relative to other funds in the same classification). In each case, the categories for fund classification used by Lipper for the Lipper Leader ratings are those maintained by CIFSC (or a successor to the CIFSC). Lipper Leader ratings are measured monthly over 36, 60 and 120 month periods, and an overall rating is also measured, which is an un-weighted average of the previous three periods. The highest 20% of funds in each category are named Lipper Leaders for that particular rating and receive a score of 5, the next 20% receive a score of 4, the middle 20% are scored 3, the next 20% are scored 2 and the lowest 20% are scored 1.
11. The Lipper Awards, awarded annually in Canada, are based on the Lipper Ratings for Consistent Return measure, which, as generally described above, is a risk-adjusted mutual fund return performance measure used by Lipper that takes into account both short- and long-term risk-adjusted performance relative to fund classification, together with a measure of a fund’s consistency. In respect of the Lipper Awards for Canada, the Lipper Ratings for Consistent Return are measured over the 36, 60 and 120 month periods ending at the end of July of each year. As noted above, the highest 20% of funds in each classification are named Lipper Leaders for Consistent Return, and the highest Lipper Leader for Consistent Return in each applicable fund classification over these periods (currently, in the case of the Lipper ETF Awards, over the 36 month period only) wins a Lipper Award.
12. When a Fund is awarded a Lipper Award, it may make reference to the award in sales communications subject to the terms of a license agreement with Lipper.
13. The Lipper Leader ratings are performance ratings or rankings under NI 81-102 and Lipper Awards for Funds may be considered to be performance ratings or rankings given that the awards are based on the Lipper Leader ratings as described above. Therefore, references to Lipper Leader ratings and Lipper Awards in sales communications relating to the Funds need to meet the applicable requirements in Part 15 of NI 81-102.
14. Section 15.3(4)(c) of NI 81-102 imposes a “matching” requirement for performance ratings or rankings that are included in sales communications for funds. If a performance rating or ranking is referred to in a sales communication, the performance rating or ranking must be provided for, or “match”, each period for which standard performance data is required to be given for the fund except the period since the inception of the fund (i.e., for one, three, five and ten year periods, as applicable).
15. In Canada and elsewhere, Lipper Leader ratings are calculated only for 36, 60 and 120 month periods and are not calculated for a one year period. This means that a sales communication referencing a Lipper Leader rating cannot comply with the “matching” requirement contained in section 15.3(4)(c) of NI 81-102 because a rating is not available for the one year period. Relief from section 15.3(4)(c) of NI 81-102 is therefore required in order for Funds to reference Lipper Leader ratings in sales communications.
16. In addition, a sales communication referencing the overall Lipper Leader ratings and the Lipper Awards, which are based on the Lipper Leader ratings, must disclose the corresponding Lipper Leader rating for each period for which standard performance data is required to be given. As noted above, because a rating for the one year period is not available for the Lipper Leader ratings, sales communications referencing the overall Lipper Leader ratings or Lipper Awards also cannot comply with the matching requirement contained in section 15.3(4)(c) of NI 81-102.
17. The exemption in section 15.3(4.1) of NI 81-102 for references to overall ratings or rankings of funds cannot be relied upon to reference the overall Lipper Leader ratings or Lipper Awards in sales communications for the Funds because section 15.3(4.1) is available only if a sales communication “otherwise complies” with the requirements of section 15.3(4). As noted above, sales communications referencing the overall Lipper Leader ratings or Lipper Awards cannot comply with the matching requirement in section 15.3(4) because the underlying Lipper Leader ratings are not available for the one year period, rendering the exemption in section 15.3(4.1) unavailable. Relief from section 15.3(4)(c) is therefore required in order for Funds to reference overall Lipper Leader ratings and the Lipper Awards in sales communications.
18. Section 15.3(4)(f) of NI 81-102 imposes certain restrictions on disclosure in sales communications. The section provides that in order for a rating or ranking such as a Lipper Award to be used in an advertisement, the advertisement must be published within 45 days of the calendar month end to which the rating or ranking applies. Further, in order for the rating or ranking to be used in any other sales communication, the rating or ranking must be published within three months of the calendar month end to which the rating or ranking applies.
19. Because the evaluation of funds for the Lipper Awards will be based on data aggregated until the end of July in any given year and the results will be published in November of that year, by the time a Fund receives an award in November, section 15.3(4)(f) of NI 81-102 will prohibit it from publishing news of the award altogether.
November 27, 2014 (2014), 37 OSCB 10450
Decisions, Orders and Rulings
20. The Exemption Sought is required in order for Lipper Leader ratings and Lipper Awards to be referenced in sales communications relating to the Funds.
21. The Filers submit that the Lipper Awards provide an important tool for investors, as they provide investors with context when evaluating investment choices. The Filers submit that the nature of the Lipper Leader ratings and Lipper Awards alleviates any concern that references to the ratings and awards may be misleading and therefore contrary to section 15.2(1)(a) of NI 81-102. The Lipper Leader Rating System underlying the Lipper Leader ratings and Lipper Awards ensures an objective, transparent and quantitative measure of performance that is based on the expertise of Lipper in fund analysis.
Decision
Each of the Decision Makers is satisfied that the decision meets the test set out in the Legislation for the Decision Maker to make the decision.
The decision of the Decision Makers under the Legislation is that the Exemption Sought is granted to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to a Fund provided that:
(a) the sales communication that refers to the Lipper Award and Lipper Leader ratings complies with Part 15 of NI 81-102 other than as set out herein and contains the following disclosure in at least 10 point type:
(i) the name of the category for which the Fund has received the award or rating;
(ii) the number of mutual funds in the category for the applicable period;
(iii) the name of the ranking entity, i.e., Lipper;
(iv) the length of period and the ending date, or, the first day of the period and the ending date on which the Lipper Award or Lipper Leader rating is based;
(v) a statement that Lipper Leader ratings are subject to change every month;
(vi) in the case of a Lipper Award, a brief overview of the Lipper Awards;
(vii) in the case of a Lipper Leader rating (other than Lipper Leader ratings referenced in connection with a Lipper Award), a brief overview of the Lipper Leader rating;
(viii) where Lipper Awards are referenced, the corresponding Lipper Leader rating that the Lipper Award is derived from presented for each period for which standard performance data is required other than the one year and since inception periods;
(ix) where a Lipper Leader rating is referenced, the Lipper Leader ratings presented for each period for which standard performance data is required other than the one year and since inception periods;
(x) the meaning of the Lipper Leader ratings from 1 to 5 (e.g., ranking of 5 indicates a fund is in the top 20% of its category); and
(xi) reference to Lipper’s website (www.lipperweb.com) for greater detail on the Lipper Awards and Lipper Leader ratings;
(b) the Lipper Awards being referenced must not have been awarded more than 365 days before the date of the sales communication; and
(c) the Lipper Awards and Lipper Leader ratings being referenced are calculated based on comparisons of performance of investment funds within a specified category established by the CIFSC (or a successor to the CIFSC).
“Denise Weeres” Manager, Legal Corporate Finance
November 27, 2014 (2014), 37 OSCB 10451
Decisions, Orders and Rulings
2.1.27 I.G. Investment Management, Ltd.
Headnote
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions – Existing and future mutual funds managed by the Filer granted relief from paragraphs 15.3(4)(c) and (f) of NI 81-102 Investment Funds to permit references to Lipper Leader ratings and Lipper Awards in sales communications – Relief subject to conditions requiring specified disclosure and the requirement that the Lipper Awards being referenced not have been awarded more than 365 days before the date of the sales communication.
Applicable Legislative Provisions
National Instrument 81-102 Investment Funds, ss. 15.3(4)(c) and (f), 19.1.
November 4, 2014
IN THE MATTER OF THE SECURITIES LEGISLATION OF MANITOBA AND ONTARIO (the Jurisdictions)
AND
IN THE MATTER OF THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS IN MULTIPLE JURISDICTIONS
AND
IN THE MATTER OF I.G. INVESTMENT MANAGEMENT, LTD.
DECISION
Background
The securities regulatory authority or regulator in each of the Jurisdictions (Decision Maker) has received an application from I.G. Investment Management, Ltd. (the Filer) on behalf of existing mutual funds and future mutual funds of which the Filer is or becomes the investment fund manager (or of which an affiliate of the Filer becomes the investment fund manager) and to which National Instrument 81-102 Investment Funds (NI 81-102) applies (each a Fund and collectively, the Funds) for a decision under the securities legislation of the Jurisdictions (the Legislation) for an exemption from the requirements set out in sections 15.3(4)(c) and 15.3(4)(f) of NI 81-102, which provide that a sales communication must not refer to a performance rating or ranking of a mutual fund or asset allocation service unless:
(i) the rating or ranking is provided for each period for which standard performance data is required to be given, except the period since the inception of the mutual fund
(ii) the rating or ranking is to the same calendar month end that is:
(a) not more than 45 days before the date of the appearance or use of the advertisement in which it is included, and
(b) not more than three months before the date of first publication of any other sales communication in which it is included (together, the Exemption Sought), to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to the Funds.
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a dual application):
(a) The Manitoba Securities Commission is the principal regulator for this application,
(b) the Filer has provided notice that section 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in each of the other provinces and territories of Canada,
November 27, 2014 (2014), 37 OSCB 10452
Decisions, Orders and Rulings
(c) the decision is the decision of the principal regulator and evidences the decision of the securities regulatory authority or regulator in Ontario.
Interpretation
Terms defined in National Instrument 14-101 Definitions, MI 11-102 and NI 81-102 have the same meaning if used in this decision, unless otherwise defined.
Representations
This decision is based on the following facts represented by the Filer:
1. The Filer is the investment fund manager of the Funds and is registered as an investment fund manager in one or more of the jurisdictions of Canada. The head office of the Filer is located in Manitoba.
2. Each of the Funds is, or will be, an open-ended mutual fund established under the laws of Canada or a jurisdiction of Canada. The securities of each of the Funds are, or will be, qualified for distribution pursuant to a prospectus that has been, or will be, prepared and filed in accordance with the securities legislation of each applicable jurisdiction of Canada. Each of the Funds is, or will be, a reporting issuer in one or more of the jurisdictions of Canada. Each of the Funds is or will be subject to NI 81-102, including Part 15 of NI 81-102, which governs sales communications.
3. The Filer and the Funds are not in default of the securities legislation in any of the jurisdictions of Canada.
4. The Filer wishes to include in sales communications of the Funds references to Lipper Leader ratings and Lipper Awards (where such Funds have been awarded a Lipper Award.)
5. Lipper, Inc. (Lipper) is a company that is not a member of the organization of the Funds. Lipper is part of the Thomson Reuters group of companies, and is a global leader in supplying mutual fund information, analytical tools, and commentary. Lipper's fund data and analysis, fund awards designations and ratings information provide valuable insight to advisors, media and individual investors.
6. One of Lipper’s programs is the Lipper awards program. This program highlights funds that have excelled in delivering consistently strong risk-adjusted performance relative to peers and also recognizes fund families with high average scores for all funds within a particular asset class or overall. Currently the Lipper awards take place in approximately 13 countries.
7. In Canada, the Lipper Awards include the Lipper Fund Awards and Lipper ETF Awards (which will be awarded for the first time in Canada in 2014). For the Lipper Fund Awards, Lipper designates award-winning funds in most individual fund classifications for three, five and ten year periods. For the Lipper ETF Awards, Lipper will designate award- winning funds in a number of individual fund classifications for the three year period, and it is expected that awards for the five and ten year periods will be given in the future.
8. The categories for fund classification used by Lipper for the Lipper Awards in respect of Canadian funds are those maintained by the Canadian Investment Funds Standards Committee (CIFSC) (or a successor to the CIFSC), a Canadian organization that is independent of Lipper. Only those CIFSC groups of ten or more unique funds will claim a Lipper Fund Award, and only those CIFSC groups of five or more unique ETFs (each of whom have a minimum of three years of performance history) will claim a Lipper ETF Award.
9. The Lipper Awards are based on a proprietary rating methodology prepared by Lipper, the Lipper Leader Rating System. The Lipper Leader Rating System is a toolkit that uses investor-centred criteria to deliver a simple, clear description of a fund's success in meeting certain goals, such as preserving capital, lowering expenses or building wealth. Lipper Ratings provide an instant measure of a fund’s success against a specific set of key metrics, and can be useful to investors in identifying funds that meet particular characteristics.
10. In Canada, the Lipper Leader Rating System includes Lipper Leader ratings for Consistent Return (reflecting funds’ historical risk-adjusted returns relative to funds in the same classification), for Total Return (reflecting funds’ historical total return performance relative to funds in the same classification) and for Preservation (reflecting funds’ historical loss avoidance relative to other funds in the same classification). In each case, the categories for fund classification used by Lipper for the Lipper Leader ratings are those maintained by CIFSC (or a successor to the CIFSC). Lipper Leader ratings are measured monthly over 36, 60 and 120 month periods, and an overall rating is also measured, which is an un-weighted average of the previous three periods. The highest 20% of funds in each category are named Lipper Leaders for that particular rating and receive a score of 5, the next 20% receive a score of 4, the middle 20% are scored 3, the next 20% are scored 2 and the lowest 20% are scored 1.
November 27, 2014 (2014), 37 OSCB 10453
Decisions, Orders and Rulings
11. The Lipper Awards, awarded annually in Canada, are based on the Lipper Ratings for Consistent Return measure, which, as generally described above, is a risk-adjusted mutual fund return performance measure used by Lipper that takes into account both short- and long-term risk-adjusted performance relative to fund classification, together with a measure of a fund’s consistency. In respect of the Lipper Awards for Canada, the Lipper Ratings for Consistent Return are measured over the 36, 60 and 120 month periods ending at the end of July of each year. As noted above, the highest 20% of funds in each classification are named Lipper Leaders for Consistent Return, and the highest Lipper Leader for Consistent Return in each applicable fund classification over these periods (currently, in the case of the Lipper ETF Awards, over the 36 month period only) wins a Lipper Award.
12. When a Fund is awarded a Lipper Award, it may make reference to the award in sales communications subject to the terms of a license agreement with Lipper.
13. The Lipper Leader ratings are performance ratings or rankings under NI 81-102 and Lipper Awards for Funds may be considered to be performance ratings or rankings given that the awards are based on the Lipper Leader ratings as described above. Therefore, references to Lipper Leader ratings and Lipper Awards in sales communications relating to the Funds need to meet the applicable requirements in Part 15 of NI 81-102.
14. Section 15.3(4)(c) of NI 81-102 imposes a “matching” requirement for performance ratings or rankings that are included in sales communications for funds. If a performance rating or ranking is referred to in a sales communication, the performance rating or ranking must be provided for, or “match”, each period for which standard performance data is required to be given for the fund except the period since the inception of the fund (i.e., for one, three, five and ten year periods, as applicable).
15. In Canada and elsewhere, Lipper Leader ratings are calculated only for 36, 60 and 120 month periods and are not calculated for a one year period. This means that a sales communication referencing a Lipper Leader rating cannot comply with the “matching” requirement contained in section 15.3(4)(c) of NI 81-102 because a rating is not available for the one year period. Relief from section 15.3(4)(c) of NI 81-102 is therefore required in order for Funds to reference Lipper Leader ratings in sales communications.
16. In addition, a sales communication referencing the overall Lipper Leader ratings and the Lipper Awards, which are based on the Lipper Leader ratings, must disclose the corresponding Lipper Leader rating for each period for which standard performance data is required to be given. As noted above, because a rating for the one year period is not available for the Lipper Leader ratings, sales communications referencing the overall Lipper Leader ratings or Lipper Awards also cannot comply with the matching requirement contained in section 15.3(4)(c) of NI 81-102.
17. The exemption in section 15.3(4.1) of NI 81-102 for references to overall ratings or rankings of funds cannot be relied upon to reference the overall Lipper Leader ratings or Lipper Awards in sales communications for the Funds because section 15.3(4.1) is available only if a sales communication “otherwise complies” with the requirements of section 15.3(4). As noted above, sales communications referencing the overall Lipper Leader ratings or Lipper Awards cannot comply with the matching requirement in section 15.3(4) because the underlying Lipper Leader ratings are not available for the one year period, rendering the exemption in section 15.3(4.1) unavailable. Relief from section 15.3(4)(c) is therefore required in order for Funds to reference overall Lipper Leader ratings and the Lipper Awards in sales communications.
18. Section 15.3(4)(f) of NI 81-102 imposes certain restrictions on disclosure in sales communications. The section provides that in order for a rating or ranking such as a Lipper Award to be used in an advertisement, the advertisement must be published within 45 days of the calendar month end to which the rating or ranking applies. Further, in order for the rating or ranking to be used in any other sales communication, the rating or ranking must be published within three months of the calendar month end to which the rating or ranking applies.
19. Because the evaluation of funds for the Lipper Awards will be based on data aggregated until the end of July in any given year and the results will be published in November of that year, by the time a Fund receives an award in November, section 15.3(4)(f) of NI 81-102 will prohibit it from publishing news of the award altogether.
20. The Exemption Sought is required in order for Lipper Leader ratings and Lipper Awards to be referenced in sales communications relating to the Funds.
21. The Filer submits that the Lipper Awards provide an important tool for investors, as they provide investors with context when evaluating investment choices. The Filer submits that the nature of the Lipper Leader ratings and Lipper Awards alleviates any concern that references to the ratings and awards may be misleading and therefore contrary to section 15.2(1)(a) of NI 81-102. The Lipper Leader Rating System underlying the Lipper Leader ratings and Lipper Awards ensures an objective, transparent and quantitative measure of performance that is based on the expertise of Lipper in fund analysis.
November 27, 2014 (2014), 37 OSCB 10454
Decisions, Orders and Rulings
Decision
Each of the Decision Makers is satisfied that the decision meets the test set out in the Legislation for the Decision Maker to make the decision.
The decision of the Decision Makers under the Legislation is that the Exemption Sought is granted to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to a Fund provided that:
1. the sales communication that refers to the Lipper Award and Lipper Leader ratings complies with Part 15 of NI 81-102 other than as set out herein and contains the following disclosure in at least 10 point type:
(a) the name of the category for which the Fund has received the award or rating;
(b) the number of mutual funds in the category for the applicable period;
(c) the name of the ranking entity, i.e., Lipper;
(d) the length of period and the ending date, or, the first day of the period and the ending date on which the Lipper Award or Lipper Leader rating is based;
(e) a statement that Lipper Leader ratings are subject to change every month;
(f) in the case of a Lipper Award, a brief overview of the Lipper Awards;
(g) in the case of a Lipper Leader rating (other than Lipper Leader ratings referenced in connection with a Lipper Award), a brief overview of the Lipper Leader rating;
(h) where Lipper Awards are referenced, the corresponding Lipper Leader rating that the Lipper Award is derived from is presented for each period for which standard performance data is required other than the one year and since inception periods;
(i) where a Lipper Leader rating is referenced, the Lipper Leader ratings are presented for each period for which standard performance data is required other than the one year and since inception periods;
(j) disclosure of the meaning of the Lipper Leader ratings from 1 to 5 (e.g., ranking of 5 indicates a fund is in the top 20% of its category);
(k) reference to Lipper’s website (www.lipperweb.com) for greater detail on the Lipper Awards and Lipper Leader ratings;
2. the Lipper Awards being referenced must not have been awarded more than 365 days before the date of the sales communication; and
3. the Lipper Awards and Lipper Leader ratings being referenced are calculated based on comparisons of performance of investment funds within a specified category established by the CIFSC (or a successor to the CIFSC).
“Chris Besko” Acting Director Manitoba Securities Commission
November 27, 2014 (2014), 37 OSCB 10455
Decisions, Orders and Rulings
2.1.28 Desjardins Investments Inc. et al.
Headnote
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions – Existing and future mutual funds managed by the Filer granted relief from paragraphs 15.3(4)(c) and (f) of NI 81-102 Investment Funds to permit references to Lipper Leader ratings and Lipper Awards in sales communications – Relief subject to conditions requiring specified disclosure and the requirement that the Lipper Awards being referenced not have been awarded more than 365 days before the date of the sales communication.
Applicable Legislative Provisions
National Instrument 81-102 Investment Funds, ss. 15.3(4)(c) and (f), 19.1.
(Translation)
November 5, 2014
IN THE MATTER OF THE SECURITIES LEGISLATION OF QUÉBEC AND ONTARIO (the Jurisdictions)
AND
IN THE MATTER OF THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS IN MULTIPLE JURISDICTIONS
AND
IN THE MATTER OF THE INVESTMENT FUND MANAGERS LISTED IN SCHEDULE A (the Filers)
DECISION
Background
The securities regulatory authority or regulator in each of the Jurisdictions (the Decision Maker) has received an application from the Filers on behalf of the Funds (as defined below) for a decision under the securities legislation of the Jurisdictions (the Legislation) for an exemption under section 19.1 of Regulation 81-102 respecting Investment Funds (c.V-1.1, r.39) (Regulation 81-102) from the requirements set out in paragraphs 15.3(4)(c) and 15.3(4)(f) of Regulation 81-102, which provide that a sales communication must not refer to a performance rating or ranking of a mutual fund or asset allocation service unless:
(i) the rating or ranking is provided for each period for which standard performance data is required to be given, except the period since the inception of the mutual fund; and
(ii) the rating or ranking is to the same calendar month end that is:
(a) not more than 45 days before the date of the appearance or use of the advertisement in which it is included, and
(b) not more than three months before the date of first publication of any other sales communication in which it is included
to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to the Funds (together, the Exemption Sought).
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a dual application):
(a) the Autorité des marchés financiers is the principal regulator for this application,
November 27, 2014 (2014), 37 OSCB 10456
Decisions, Orders and Rulings
(b) the Filers have provided notice that section 4.7(1) of Regulation 11-102 respecting Passport System (c. V-1.1, r.1) (Regulation 11-102) is intended to be relied upon in British Columbia, Alberta, Saskatchewan, Manitoba, New Brunswick, Nova Scotia, Prince Edward Island, Newfoundland and Labrador, Yukon, Nunavut and, Northwest Territories, and
(c) the decision is the decision of the principal regulator and evidences the decision of the securities regulatory authority or regulator in Ontario.
Interpretation
Terms defined in Regulation 14-101 respecting Definitions (c. V-1.1, r.3), Regulation 11-102 and Regulation 81-102 have the same meaning if used in this decision, unless otherwise defined.
Funds means the existing mutual funds for which a Filer or a duly registered affiliate of a Filer acts as investment fund manager and any mutual fund subsequently established for which a Filer, or a duly registered affiliate of a Filer, will act as investment fund manager.
Representations
This decision is based on the following facts represented by the Filers:
The Filers
1. Each of the Filers, or an affiliate of each of the Filers, acts or will act as the investment fund manager of Funds.
2. Each of the Filers is duly registered as an investment fund manager in one or more of the jurisdictions of Canada.
3. The head office of each of the Filers is located in Québec.
4. Each of the Filers is not in default of the securities legislation in any of the jurisdictions of Canada.
The Funds
5. Each of the Funds is, or will be, a mutual fund established under the laws of Canada or a jurisdiction of Canada.
6. Securities of each of the Funds are, or will be, qualified for distribution pursuant to a prospectus that has been, or will be, prepared and filed in accordance with the securities legislation of each applicable jurisdiction of Canada.
7. Each of the Funds is, or will be, a reporting issuer in one or more of the jurisdictions of Canada and is or will be subject to the requirements of Regulation 81-102, including Part 15 of Regulation 81-102, which governs sales communications.
8. Each of the Funds is not in default of the securities legislation in any of the jurisdictions of Canada.
Reasons for the Exemption Sought
9. Lipper Inc. (Lipper) is a company that is not a member of the organization of the Funds. Lipper is part of the Thomson Reuters group of companies, and is a global leader in supplying fund information, analytical tools, and commentary. Lipper's fund data and analysis, fund awards designations and ratings information provide valuable insight to advisors, media and individual investors.
10. The Filers wish to include in sales communications of the Funds references to Lipper Leader ratings (which are performance ratings or rankings for funds issued by Lipper and include the Lipper Leader ratings for Consistent Return, Lipper Leader ratings for Total Return and Lipper Leader ratings for Preservation, which are described below) and Lipper Awards (as described below) where such Funds have been awarded a Lipper Award.
11. One of Lipper’s programs is the Lipper Awards Program. The Lipper Awards Program recognizes funds that have excelled in delivering consistently strong risk-adjusted performance relative to peers and also recognizes fund families with high average scores for all funds within a particular asset class or overall (Lipper Awards). Currently Lipper Awards take place in approximately 13 countries.
12. In Canada, Lipper Awards include the Lipper Fund Awards and Lipper ETF Awards (which will be awarded for the first time in Canada in 2014). For the Lipper Fund Awards, Lipper designates award-winning funds in most individual fund
November 27, 2014 (2014), 37 OSCB 10457
Decisions, Orders and Rulings
classifications for three, five and ten year periods. For the Lipper ETF Awards, Lipper will designate award-winning funds in a number of individual fund classifications for the three year period, and it is expected that awards for the five and ten year periods will be given in the future.
13. The categories for fund classification used by Lipper for the Lipper Awards in respect of Canadian funds are those maintained by the Canadian Investment Funds Standards Committee (CIFSC) (or a successor to the CIFSC), a Canadian organization that is independent of Lipper. Only those CIFSC groups of ten or more unique funds will claim a Lipper Fund Award, and only those CIFSC groups of five or more unique ETFs (each of whom have a minimum of three years of performance history) will claim a Lipper ETF Award.
14. The Lipper Awards are based on a proprietary rating methodology prepared by Lipper, the Lipper Leader Rating System. The Lipper Leader Rating System is a toolkit that uses investor-centred criteria to deliver a simple, clear description of a fund's success in meeting certain goals, such as preserving capital, lowering expenses or building wealth. Lipper ratings provide an instant measure of a fund’s success against a specific set of key metrics and can be useful to investors in identifying funds that meet particular characteristics.
15. In Canada, the Lipper Leader Rating System includes Lipper Leader ratings for Consistent Return (based on the Lipper Ratings for Consistent Return, which are ratings that reflect funds’ historical risk-adjusted returns relative to funds in the same classification), for Total Return (based on the Lipper Ratings for Total Return, which are ratings that reflect funds’ historical total return performance relative to funds in the same classification) and for Preservation (based on the Lipper Ratings for Preservation, which are ratings that reflect funds’ historical loss avoidance relative to other funds in the same classification). In each case, the categories for fund classification used by Lipper for the Lipper Leader ratings are those maintained by CIFSC (or a successor to the CIFSC). Lipper Leader ratings are measured monthly over 36, 60 and 120 month periods, and an overall rating is also measured, which is an un-weighted average of the previous three periods. The highest 20% of funds in each category are named “Lipper Leaders” for that particular rating and receive a score of 5, the next 20% receive a score of 4, the middle 20% are scored 3, the next 20% are scored 2 and the lowest 20% are scored 1.
16. The Lipper Awards, awarded annually in Canada, are based on the Lipper Ratings for Consistent Return measure, which, as generally described above, is a risk-adjusted mutual fund return performance measure used by Lipper that takes into account both short- and long-term risk-adjusted performance relative to fund classification, together with a measure of a fund’s consistency. In respect of the Lipper Awards for Canada, the Lipper Ratings for Consistent Return are measured over the 36, 60 and 120 month periods ending at the end of July of each year. As noted above, the highest 20% of funds in each classification are named Lipper Leaders for Consistent Return, and the highest Lipper Leader for Consistent Return in each applicable fund classification over these periods (currently, in the case of the Lipper ETF Awards, over the 36 month period only) wins a Lipper Award.
17. When a fund is awarded a Lipper Award, it may make reference to the award in sales communications subject to the terms of a license agreement with Lipper.
18. The Lipper Leader ratings are “performance ratings” or “rankings” as referred in section 15.3 of Regulation 81-102 and Lipper Awards may be considered to be performance ratings or rankings given that the awards are based on the Lipper Leader ratings as described above. Therefore, references to Lipper Leader ratings and Lipper Awards in sales communications relating to the Funds need to meet the applicable requirements in Part 15 of Regulation 81-102.
19. Paragraph 15.3(4)(c) of Regulation 81-102 requires that the performance ratings or rankings that are included in sales communications for funds must be provided for, or “match”, each period for which standard performance data is required to be given for the fund except the period since the inception of the fund i.e., for one, three, five and ten year periods, as applicable (the Matching Requirements).
20. In Canada and elsewhere, Lipper Leader ratings are calculated only for 36, 60 and 120 month periods and are not calculated for a one year period. This means that a sales communication referencing a Lipper Leader rating cannot comply with the Matching Requirements contained in paragraph 15.3(4)(c) of Regulation 81-102 because a rating is not available for the one year period. Relief from paragraph 15.3(4)(c) of Regulation 81-102 is therefore required in order for Funds to reference Lipper Leader ratings in sales communications.
21. In addition, a sales communication referencing the overall Lipper Leader ratings and the Lipper Awards must disclose the corresponding Lipper Leader rating for each period for which standard performance data is required to be given. As noted above, because a rating for the one year period is not available for the Lipper Leader ratings, sales communications referencing the overall Lipper Leader ratings or Lipper Awards also cannot comply with the Matching Requirements contained in paragraph 15.3(4)(c) of Regulation 81-102.
November 27, 2014 (2014), 37 OSCB 10458
Decisions, Orders and Rulings
22. The exemption in subsection 15.3(4.1) of Regulation 81-102 for references to overall ratings or rankings of funds cannot be relied upon to reference the overall Lipper Leader ratings or Lipper Awards in sales communications for the Funds because subsection 15.3(4.1) is available only if a sales communication “otherwise complies” with the requirements of subsection 15.3(4). As noted above, sales communications referencing the overall Lipper Leader ratings or Lipper Awards cannot comply with the Matching Requirements in subsection 15.3(4) because the underlying Lipper Leader ratings are not available for the one year period, rendering the exemption in subsection 15.3(4.1) unavailable. Relief from paragraph 15.3(4)(c) is therefore required in order for Funds to reference overall Lipper Leader ratings and the Lipper Awards in sales communications.
23. Paragraph 15.3(4)(f) of Regulation 81-102 imposes certain restrictions on disclosure in sales communications. The section provides that in order for a rating or ranking such as a Lipper Award to be used in an advertisement, the advertisement must be published within 45 days of the calendar month end to which the rating or ranking applies. Further, in order for the rating or ranking to be used in any other sales communication, the rating or ranking must be published within three months of the calendar month end to which the rating or ranking applies.
24. Because the evaluation of funds for the Lipper Awards will be based on data aggregated until the end of July in any given year and the results will be published in November of that year, by the time a Fund receives an award in November, paragraph 15.3(4)(f) of Regulation 81-102 will prohibit it from publishing news of the award altogether.
25. The Exemption Sought is required in order for Lipper Leader ratings and Lipper Awards to be referenced in sales communications relating to the Funds.
26. The Filers submit that the Lipper Awards provide an important tool for investors, as they provide investors with context when evaluating investment choices. The Filers submit that the nature of the Lipper Leader ratings and Lipper Awards alleviates any concern that references to the ratings and awards may be misleading and therefore contrary to paragraph 15.2(1)(a) of Regulation 81-102. The Lipper Leader Rating System underlying the Lipper Leader ratings and Lipper Awards ensures an objective, transparent and quantitative measure of performance that is based on the expertise of Lipper in fund analysis.
Decision
Each of the Decision Makers is satisfied that the decision meets the test set out in the Legislation for the Decision Maker to make the decision.
The decision of the Decision Makers under the Legislation is that the Exemption Sought is granted to permit the Lipper Awards and Lipper Leader ratings to be referenced in sales communications relating to the Funds provided that:
1. the sales communication that refers to the Lipper Award and Lipper Leader ratings complies with Part 15 of Regulation 81-102, other than as set out herein, and contains the following disclosure in at least 10 point type:
(a) the name of the category (which is a category established by the CIFSC or a successor to the CIFSC) for which the Funds have received the award or rating;
(b) the number of mutual funds in the category for the applicable period;
(c) the name of the ranking entity, i.e., Lipper;
(d) the length of period and the ending date, or, the first day of the period and the ending date on which the Lipper Award or Lipper Leader rating is based;
(e) a statement that Lipper Leader ratings are subject to change every month;
(f) in the case of a Lipper Award, a brief overview of the Lipper Awards;
(g) in the case of a Lipper Leader rating other than Lipper Leader ratings referenced in connection with a Lipper Award, a brief overview of the Lipper Leader rating;
(h) where Lipper Awards are referenced, the corresponding Lipper Leader rating that the Lipper Award is derived from is presented for each period for which standard performance data is required other than the one year and since inception periods;
(i) where a Lipper Leader rating is referenced, the Lipper Leader ratings are presented for each period for which standard performance data is required other than the one year and since inception periods;
November 27, 2014 (2014), 37 OSCB 10459
Decisions, Orders and Rulings
(j) disclosure of the meaning of the Lipper Leader ratings from 1 to 5 (e.g., ranking of 5 indicates a fund is in the top 20% of its category);
(k) reference to Lipper’s website (www.lipperweb.com) for greater detail on the Lipper Awards and Lipper Leader ratings, which includes the rating methodology prepared by Lipper;
2. the Lipper Awards being referenced must not have been awarded more than 365 days before the date of the sales communication; and
3. the Lipper Awards and Lipper Leader ratings being referenced are calculated based on comparisons of performance of investment funds within a specified category established by the CIFSC (or a successor to the CIFSC).
“Josée Deslauriers” Senior Director, Investment Funds and Continuous Disclosure Autorité des marchés financiers
November 27, 2014 (2014), 37 OSCB 10460
Decisions, Orders and Rulings
SCHEDULE A
Investment Fund Managers
Desjardins Investments Inc. National Bank Investments Inc. Standard Life Mutual Funds Ltd. Gestion FÉRIQUE
November 27, 2014 (2014), 37 OSCB 10461
Decisions, Orders and Rulings
2.1.29 ITG Canada Corp.
Headnote
National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions – Exemptive relief granted to dealer from the prospectus delivery requirement – Relief granted from requirement to deliver prospectus subject to dealer sending or delivering a prescribed summary disclosure document to purchasers with trade confirmation when acting as agent of the purchaser – Relief conditional on implementing alternative prospectus delivery requirement – Relief subject to sunset clause – Securities Act (Ontario).
Applicable Legislative Provisions
Securities Act, R.S.O. 1990, c. S.5, as am., ss. 71(1), 147.
November 18, 2014
IN THE MATTER OF THE SECURITIES LEGISLATION OF ONTARIO (the Jurisdiction)
AND
IN THE MATTER OF THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS IN MULTIPLE JURISDICTIONS
AND
IN THE MATTER OF ITG CANADA CORP. (the Filer)
DECISION
Background
The principal regulator in the Jurisdiction has received an application from the Filer for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Act) for exemptive relief from the Prospectus Delivery Requirement (as defined below) in connection with distributions of an ETF Security (as defined below) (the Exemption Sought).
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission is the principal regulator for this application; and
(b) the Filer has provided notice that subsection 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11- 102) is intended to be relied upon in British Columbia, Alberta, Saskatchewan, Manitoba, Québec, New Brunswick and Nova Scotia (together with the Jurisdiction, the Jurisdictions).
Interpretation
Terms defined in National Instrument 14-101 Definitions, and MI 11-102 have the same meaning if used in this application, unless otherwise defined.
Authorized Dealer means a registered dealer that has entered, or intends to enter, into an agreement with the manager of an ETF (an “ETF Manager”) authorizing the dealer to subscribe for, purchase and redeem Creation Units from one or more ETFs on a continuous basis from time to time.
Designated Broker means a registered dealer that has entered, or intends to enter, into an agreement with an ETF Manager to perform certain duties in relation to the ETF, including posting a liquid two-way market for the trading of the ETF’s listed securities on an exchange or another marketplace.
ETF means an open end mutual fund that has listed a class of securities on an exchange in Canada.
November 27, 2014 (2014), 37 OSCB 10462
Decisions, Orders and Rulings
ETF Security means a listed security of an ETF.
Prospectus Delivery Requirement means the requirement that a dealer, not acting as agent of the purchaser, who receives an order or subscription for a security offered in a distribution to which the prospectus requirement of the Act applies, send or deliver to the purchaser or its agent, unless the dealer has previously done so, the latest prospectus and any amendment either before entering into an agreement of purchase and sale resulting from the order or subscription, or not later than midnight on the second business day after entering into that agreement.
Prospectus Right of Rescission means the right of action, given to a purchaser under the Act, for rescission or damages against a dealer, for failure of the dealer to send or deliver a prospectus to a purchaser of a security or its agent to whom a prospectus and any amendment was required to be sent or delivered but was not sent or delivered in compliance with the Prospectus Delivery Requirement. In Québec, such a purchaser may apply to have the transaction rescinded or the price revised, at the purchaser’s option, without prejudice to the purchaser’s claim for damages. Collectively, these rights are referred to as the Prospectus Rights of Rescission.
Right of Withdrawal means the right, given to a purchaser under the Act, to withdraw from an agreement of purchase and sale for a security to which the Prospectus Delivery Requirement applies if the dealer from which the purchaser purchases the security receives written notice evidencing the intention of the purchaser not to be bound by the agreement within two business days of receipt of the latest prospectus and any amendment. In Québec, this right is called a right to rescind. Collectively, these rights are referred to as the Rights of Withdrawal.
Trade Confirmation Right of Rescission means the right, given to a purchaser of an ETF Security under the Act in certain circumstances, to rescind the purchase within 48 hours after receiving confirmation of the purchase.
Representations
This decision is based on the following facts represented by the Filer:
1. The Filer is currently and actively registered as investment dealers in the Jurisdictions.
2. The Filer is a registered Investment Industry Regulatory Organization of Canada dealer member that trades securities, including ETF Securities, for institutional clients.
3. The head offices of the Filer is located in Toronto, Ontario.
4. ETF Securities are, or will be, distributed on a continuous basis in one or more of the Jurisdictions pursuant to a prospectus. ETF Securities are generally only subscribed for or purchased directly from the ETF by Authorized Dealers or Designated Brokers. Investors are generally expected to purchase ETF Securities through dealers executing trades using the facilities of an exchange or another marketplace. ETF Securities may also be issued directly to ETF investors upon the reinvestment of distributions of income or capital gains.
5. The Filer is an Authorized Dealer and/or Designated Broker, depending on the ETF in question, that from time to time subscribes for and purchases newly issued ETF Securities (Creation Units) directly from one or more ETFs. The Filer is also generally engaged in purchasing and selling ETF Securities of the same class as the Creation Units in the secondary market. Transactions involving ETF Securities are an important part of the Filer’s business.
6. Creation Units are generally commingled with ETF Securities purchased in the secondary market. As such, it is not practicable for the Filer to determine whether a particular re-sale of ETF Securities involves Creation Units or ETF Securities purchased in the secondary market.
7. The Filer acts as a market-maker with respect to certain ETFs for which ETFs it has certain underwriting obligations for. The Filer also has market-making obligations for ETFs it acts as a Designated Broker for. The Filer distributes Creation Units in connection with its market-making obligations.
8. The Filer may not be able to efficiently fulfill a client’s order for ETF Securities solely through the secondary market therefore the Filer often has to transact in Creation Units for such ETFs which they act as Authorized Dealer or Designated Broker for. When the Filer sells ETF Securities for their clients on an exchange or another marketplace it does not know the identity of the purchaser.
9. The Filer may also be engaged in purchasing and selling, in the secondary market, ETF Securities of ETFs for which they are not an Authorized Dealer or Designated Broker.
November 27, 2014 (2014), 37 OSCB 10463
Decisions, Orders and Rulings
Prospectus Delivery Requirement
10. The Filer is aware that the principal regulator takes the view that the first re-sale of a Creation Unit on an exchange or another marketplace in Canada will generally constitute a distribution of Creation Units under the Act and that the Filer is subject to the Prospectus Delivery Requirement in connection with such re-sales. Furthermore, the Filer is aware that the Prospectus Delivery Requirement applies to Creation Units sold pursuant to the Filer’s market-making responsibilities for a particular ETF as a result of the Filer’s obligations as a Designated Broker and otherwise as describe herein, as applicable. Re-sales of ETF Securities purchased by the Filer in the secondary market, that are not Creation Units, would not ordinarily constitute a distribution of ETF Securities.
11. Compliance with the Prospectus Delivery Requirement is not practicable in the circumstances of re-sales of Creation Units on an exchange or another marketplace by a Filer as the Filer will often not know the identity of a purchaser and will generally not know whether a sale involves Creation Units.
12. The Prospectus Delivery Requirement affects investors in ETF Securities differently depending upon whether their purchase order is filled through the re-sale of Creation Units or through a secondary market trade. The Prospectus Delivery Requirement also affects investors in ETF Securities differently from investors in conventional mutual funds because, unlike sales of conventional mutual funds, only sales of ETF Securities that are Creation Units are distributions under the Act.
13. The Filer, when acting for a purchaser of an ETF Security, is required under the Act to deliver a trade confirmation to the purchaser in connection with each trade of an ETF Security, unless the Filer is exempt from the requirement in respect of a particular trade. Investors in ETF Securities will be better served if the Filer sends or delivers a prescribed summary disclosure document to all purchasers of ETF Securities who are customers of the Filer at the same time as they deliver the trade confirmation, regardless of whether the purchaser’s order is filled through the re-sale of a Creation Unit, or through the re-sale of an ETF Security purchased in the secondary market.
14. Various ETF Managers have obtained exemptive relief from their principal regulator from the requirements to include an underwriter’s certificate and to include a statement respecting purchasers’ statutory rights of withdrawal and rescission in an ETF’s prospectus (the “ETF Relief”). Conditions of the ETF Relief include that an ETF must file a prescribed summary disclosure document with the applicable Jurisdictions on the System for Electronic Document Analysis and Retrieval (the “Summary Document”).
Civil Liability for Prospectus Misrepresentations
15. The liability under the prospectus civil liability provisions of the Act, of an ETF or its investment fund manager for a misrepresentation in a prospectus, will not be affected by the grant of an exemption from the Prospectus Delivery Requirement. Under such provisions, purchasers of Creation Units offered by a prospectus during the period of distribution have a right of action for damages against the ETF and its investment fund manager without regard to whether the purchaser relied on the misrepresentation and whether or not the purchaser in fact received a copy of the prospectus. Under the secondary market disclosure civil liability provisions of the Act, purchasers of ETF Securities that are not Creation Units and, therefore, are not offered by prospectus during the period of distribution, have a similar right of action for damages for misrepresentation in a prospectus against the ETF and its investment fund manager without regard to whether the purchaser relied on the misrepresentation and whether or not the purchaser in fact received a copy of the prospectus.
16. The Filer takes the view, in the circumstances, that they are not underwriters within the meaning of the Act. The Filer does not provide the same services in connection with a distribution of Creation Units as would typically be provided by an underwriter in a conventional underwriting. They are not involved in the preparation of an ETF’s prospectus, do not incur any marketing costs or receive any underwriting fees or commissions from the ETFs or the ETF Managers in connection with the distribution of Creation Units. ETF Managers generally conduct their own marketing, advertising and promotion of the ETFs. The Filer generally seek to profit from its ability to create and redeem ETF Securities by engaging in arbitrage trading to capture spreads between the trading prices of ETF Securities and their underlying securities and by making markets for their clients to facilitate client trading in ETF Securities. In the circumstances, the Filer take the view that a purchaser of an ETF Security will not be entitled to exercise a statutory right of action for rescission or damages against an Authorized Dealer or Designated Broker in the event that the prospectus contains a misrepresentation.
Right of Withdrawal
17. Under the Act, if the Prospectus Delivery Requirement applies in respect of a sale of Creation Units, the purchaser of the Creation Units has a Right of Withdrawal.
November 27, 2014 (2014), 37 OSCB 10464
Decisions, Orders and Rulings
18. It is not practicable for the Filer to provide purchasers of Creation Units on an exchange or another marketplace with a prospectus in accordance with the Prospectus Delivery Requirement as the Filer will often not know the identity of a purchaser and will generally not know whether the sale involves Creation Units.
19. Where the Exemption Sought is being relied upon by the Filer in respect of a re-sale of Creation Units, the Right of Withdrawal will not be available to the purchaser of Creation Units if a prospectus is not required to be sent or delivered. Under the ETF Relief, an ETF will state in its prospectus or amendment to its prospectus that the Right of Withdrawal will not be available in such circumstances. Under the ETF Relief, an ETF will state in its Summary Document that under the securities legislation of some of the Jurisdictions an investor has the Trade Confirmation Right of Rescission and other rights and remedies if the Summary Document or prospectus contains a misrepresentation.
Prospectus Right of Rescission
20. Under the Act, if a dealer is subject to the Prospectus Delivery Requirement in respect of a sale of Creation Units, the purchaser of the Creation Units has the Prospectus Right of Rescission.
21. Where the Exemption Sought is being relied upon by the Filer in respect of a re-sale of Creation Units, the Prospectus Right of Rescission will not be available to the purchaser of Creation Units because the Prospectus Delivery Requirement will not apply. Under the ETF Relief, an ETF will state in its prospectus or amendment to its prospectus that the Prospectus Right of Rescission will not be available in such circumstances.
Trade Confirmation Right of Rescission
22. In applicable Jurisdictions, purchasers of ETF Securities will continue to have the Trade Confirmation Right of Rescission as it is not affected by the grant of an exemption from the Prospectus Delivery Requirement.
Decision
The principal regulator is satisfied that the decision meets the test set out in the Act for the principal regulator to make the decision.
The decision of the principal regulator under the Act is that the Exemption Sought is granted, provided that and so long as:
1. The Filer undertakes to the principal regulator that it will, unless the Filer has previously done so, send or deliver to each purchaser of an ETF Security who is a customer of the Filer, and to whom a trade confirmation is required under the Act to be sent or delivered by the Filer in connection with the purchase, the latest Summary Document filed in respect of the ETF Security not later than midnight on the second day, exclusive of Saturdays, Sundays and holidays, after the purchase of the ETF Security.
2. The Filer provides to each ETF Manager of an ETF for which it is an Authorized Dealer or Designated Broker, an executed acknowledgement:
(a) acknowledging receipt of a copy of this decision;
(b) agreeing to send or deliver the Summary Document in accordance with this decision;
(c) undertaking that the Filer will attach or bind one ETF’s Summary Document with another ETF’s Summary Document only if the documents are being sent or delivered under this decision at the same time to an investor purchasing ETF Securities of each such ETF; and
(d) confirming that the Filer has in place written policies and procedures to ensure that there is compliance with the conditions of this decision.
3. The Filer provides to each ETF Manager of an ETF in whose ETF Securities it is generally engaged in purchasing and selling in the secondary market on behalf of its customers, but for which it is not an Authorized Dealer or Designated Broker, an executed acknowledgement:
(a) acknowledging receipt of a copy of this decision;
(b) agreeing to send or deliver the Summary Document in accordance with this decision;
November 27, 2014 (2014), 37 OSCB 10465
Decisions, Orders and Rulings
(c) undertaking that the Filer will attach or bind one ETF’s Summary Document with another ETF’s Summary Document only if the documents are being sent or delivered under this decision at the same time to an investor purchasing ETF Securities of each such ETF; and
(d) confirming that the Filer has in place written policies and procedures to ensure that there is compliance with the conditions of this decision.
4. The Filer files with the principal regulator, to the attention of the Director, Investment Funds Branch, on or before January 31st in each calendar year, a certificate signed by the Filer’s ultimate designated person certifying that, to the best of the knowledge of such person after making due inquiry, the Filer has complied with the terms and conditions of this decision during the previous calendar year.
5. The Exemption Sought terminates on September 1, 2015.
“Judith N. Robertson” Commissioner Ontario Securities Commission
“Christopher Portner” Commissioner Ontario Securities Commission
November 27, 2014 (2014), 37 OSCB 10466
Decisions, Orders and Rulings
2.2 Orders
2.2.1 Bigfoot Recreation & Ski Area Ltd. and Ronald Stephen McHaffie – ss. 127(1), 127(10)
IN THE MATTER OF THE SECURITIES ACT, R.S.O. 1990, c. S.5, AS AMENDED
AND
IN THE MATTER OF BIGFOOT RECREATION & SKI AREA LTD. and RONALD STEPHEN MCHAFFIE
ORDER (Subsections 127(1) and 127(10) of the Securities Act)
WHEREAS on September 22, 2014, the Ontario Securities Commission (the “Commission”) issued a Notice of Hearing pursuant to subsections 127(1) and 127(10) of the Securities Act, R.S.O. 1990, c. S.5, as amended (the “Act”) in respect of Bigfoot Recreation & Ski Area Ltd. (“Bigfoot”) and Ronald Stephen McHaffie (“McHaffie”) (collectively, the “Respondents”);
AND WHEREAS on September 22, 2014, Staff of the Commission (“Staff”) filed a Statement of Allegations in respect of the same matter;
AND WHEREAS on October 24, 2014, Staff appeared before the Commission and brought an application to convert this matter to a written hearing;
AND WHEREAS on October 24, 2014, Staff filed an affidavit of service sworn by Lee Crann, a Law Clerk with the Commission, which documented steps taken by Staff to serve the Respondents with the Notice of Hearing, Statement of Allegations and Staff’s disclosure materials, and made submissions to the Commission;
AND WHEREAS the Respondents did not appear;
AND WHEREAS on October 24, 2014, the Commission ordered that:
(1) the Respondents shall advise of any objections they have to proceeding by way of written hearing within 5 days following service of the October 24, 2014 order; and
(2) once Staff has advised the Office of the Secretary that the period for objections has passed, the Commission will issue an order addressing Staff’s application;
AND WHEREAS both of the Respondents received service of the October 24, 2014 order no later than November 4, 2014;
AND WHEREAS Staff received no communication from the Respondents in relation to Staff’s application to proceed by way of written hearing within the time allotted by the Commission’s Rules of Procedure;
AND WHEREAS the Commission is of the opinion that it is in the public interest to make this order;
IT IS HEREBY ORDERED THAT:
(1) Staff’s application to proceed by way of written hearing is granted;
(2) Staff’s materials in respect of the written hearing shall be served and filed no later than 10 days following the issuance of this order;
(3) the Respondents’ responding materials, if any, shall be served and filed no later than 4 weeks from the effective date of service of Staff’s materials; and
(4) Staff’s reply materials, if any, shall be served and filed no later than 2 weeks from effective date of service of the Respondents’ materials.
DATED at Toronto this 19th day of November, 2014.
“Mary G. Condon”
November 27, 2014 (2014), 37 OSCB 10467
Decisions, Orders and Rulings
2.2.2 Pro-Financial Asset Management Inc.
IN THE MATTER OF THE SECURITIES ACT, R.S.O. 1990, c. S.5, AS AMENDED
AND
IN THE MATTER OF PRO-FINANCIAL ASSET MANAGEMENT INC.
ORDER
WHEREAS on May 17, 2013, the Commission issued a temporary order (the “Temporary Order”) with respect to Pro- Financial Asset Management Inc. (“PFAM”) pursuant to subsections 127(1) and (5) of the Securities Act, R.S.O. 1990, c. S.5, as amended (the “Act”) ordering that:
(i) pursuant to paragraph 1 of subsection 127(1) of the Act, the registration of PFAM as a dealer in the category of exempt market dealer be suspended and the following terms and conditions apply to the registration of PFAM as an adviser in the category of portfolio manager (“PM”) and to its operation as an investment fund manager (“IFM”):
a. PFAM’s activities as a PM and IFM shall be applied exclusively to the Managed Accounts (as defined in the Temporary Order) and to the Pro-Hedge Funds and Pro-Index Funds (as defined in the Temporary Order); and
b. PFAM shall not accept any new clients or open any new client accounts of any kind in respect of the Managed Accounts;
(ii) pursuant to subsection 127(6) of the Act, the Temporary Order shall take effect immediately and shall expire on the fifteenth day after its making unless extended by order of the Commission;
AND WHEREAS on May 28, 2013, the Commission ordered: (i) the Temporary Order be extended to June 27, 2013; (ii) the hearing to consider whether to further extend the terms of the Temporary Order and/or to make any further order as to PFAM’s registration proceed on June 26, 2013 at 10:00 a.m.;
AND WHEREAS on June 26, 2013, the Commission ordered that: (i) the Temporary Order be extended to July 15, 2013; and (ii) the affidavit of Michael Denyszyn sworn May 24, 2013 not be marked as an exhibit until the next appearance in the absence of a Commission order to the contrary; and the hearing to consider this matter proceed on July 12, 2012;
AND WHEREAS on July 11, 2013, the Commission ordered that: (i) the Temporary Order be extended to July 22, 2013; (ii) the hearing be adjourned to July 18, 2013 at 11:00 a.m.; and (iii) the hearing date of July 12, 2013 at 10:00 a.m. be vacated;
AND WHEREAS on July 18, 2013, PFAM brought a motion (the “First PFAM Motion”) that the hearing be held in camera and that the affidavits of Michael Denyszyn sworn May 24 and June 24, 2013 and the affidavit of Michael Ho sworn July 17, 2013 (collectively the “Staff Affidavits”) either not be admitted as evidence or else be treated as confidential documents and the parties agreed that the motion should be heard in camera;
AND WHEREAS on July 18, 2013, PFAM’s counsel filed supporting documents (the “PFAM Materials”) in support of the First PFAM Motion and counsel for PFAM and Staff made oral submissions and filed written submissions;
AND WHEREAS on July 22, 2013, the Commission ordered:
(i) the Temporary Order be extended to August 26, 2013;
(ii) leave be granted to the parties to file written submissions in respect of the First PFAM Motion;
(iii) the Staff Affidavits, the transcript of the PFAM motion, the PFAM Materials, written submissions filed by Staff and PFAM and other documents presented during the course of the First PFAM Motion shall be treated as confidential documents until further direction or order of the Commission; and
(iv) the hearing be adjourned to August 23, 2013 at 10:00 a.m.;
November 27, 2014 (2014), 37 OSCB 10468
Decisions, Orders and Rulings
AND WHEREAS on August 23, 2013, Staff filed with the Commission the affidavit of Michael Ho sworn August 22, 2013 and PFAM’s counsel filed the affidavit of Stuart McKinnon dated August 23, 2013 but the parties did not seek to mark these affidavits as exhibits;
AND WHEREAS on August 23, 2013, Staff and counsel for PFAM advised the Commission that the parties had agreed on the terms of a draft order;
AND WHEREAS on August 23, 2013, PFAM requested that the hearing be held in camera so PFAM’s submissions on certain confidentiality issues could be heard and Staff did not oppose PFAM’s request;
AND WHEREAS on August 27, 2013, the Commission ordered:
(i) the Temporary Order be extended to October 11, 2013;
(ii) the affidavit of Michael Ho sworn August 22, 2013 and the affidavit of Stuart McKinnon sworn August 23, 2013 be treated as confidential documents until further order of the Commission;
(iii) PFAM will deliver to Staff the final principal protected note (“PPN”) reconciliation report by 4:30 p.m. on September 30, 2013; and
(iv) the hearing to consider whether to: (i) make any further order as to PFAM’s registration as an adviser in the category of PM or in respect of its operation as an IFM, as a result of PFAM’s ongoing capital deficiency; and/or (ii) otherwise vary or extend the terms of the Temporary Order, proceed on October 9, 2013 at 11:00 a.m.;
AND WHEREAS on October 9, 2013, PFAM brought a second motion (the “Second PFAM Motion”) for an order that the hearing be held in camera and for a confidentiality order treating as confidential documents: (i) the Staff and PFAM affidavits; (ii) all facta and correspondence exchanged by Staff and PFAM; and (iii) any transcript of this and prior in camera proceedings;
AND WHEREAS on October 9, 2013, PFAM’s counsel filed written submissions dated October 8, 2013, the affidavit of Stuart McKinnon sworn October 7, 2013 and the affidavit of Kenneth White sworn October 7, 2013 in support of the Second PFAM Motion and Staff filed written submissions dated October 9, 2013 and the affidavit of Michael Ho sworn October 8, 2013 and opposed the request for an in camera hearing and for the confidentiality order;
AND WHEREAS on October 9, 2013, the Commission heard submissions from counsel on the Second PFAM Motion in camera and the Commission requested the parties to prepare a draft order that, among other matters, addressed the confidentiality of documents filed with the Commission and permitted BNP Paribas Canada (“BNP”) and Société Générale Canada (“SGC”) (collectively the “Banks”) to review certain documents attached to Staff affidavits dealing substantively with the PPN reconciliation process, provided the Banks treated such documents as confidential;
AND WHEREAS on October 11, 2013, the Commission ordered that:
(i) the Temporary Order be extended to December 15, 2013;
(ii) the affidavit of Michael Ho sworn October 8, 2013, the affidavit of Stuart McKinnon sworn October 7, 2013, the affidavit of Kenneth White sworn October 7, 2013 and the written submissions of the parties dated October 8 and 9, 2013 be treated as confidential documents until further order of the Commission; and
(iii) the hearing to consider whether to: (i) make any further order as to PFAM’s registration as an adviser in the category of PM or in respect of its operation as an IFM, as a result of PFAM’s ongoing capital deficiency; and/or (ii) otherwise vary or extend the terms of the Temporary Order, shall proceed on December 12, 2013 at 10:00 a.m.;
AND WHEREAS on October 17, 2013, the Commission ordered (the “October 17, 2013 Order”) that:
(i) the affidavit of Michael Ho sworn October 8, 2013, the affidavit of Stuart McKinnon sworn October 7, 2013, the affidavit of Kenneth White sworn October 7, 2013 and the written submissions of the parties dated October 8 and 9, 2013 be treated as confidential documents until further order of the Commission;
(ii) the previous orders as to confidentiality made by the Commission on July 22, 2013 and August 27, 2013 remain in force until further order or direction of the Commission; and
November 27, 2014 (2014), 37 OSCB 10469
Decisions, Orders and Rulings
(iii) documents related to the PPN reconciliation process listed on Schedule “A” to the October 17, 2013 Order be provided to counsel for the Banks on condition that the Banks treat those documents as confidential documents and not provide copies to any third party without further direction or order of the Commission;
AND WHEREAS on September 30, 2013, PFAM agreed to sell to another portfolio manager (the “Purchaser”) PFAM’s interest in all of the investment management contracts for the Pro-Index Funds and the Managed Accounts (the “First Transaction”). In a second transaction, an investor agreed to purchase through a corporation (the “Investor”) all of the shares of the Purchaser (the “Second Transaction”):
AND WHEREAS on October 22, 2013, the Purchaser and PFAM filed a notification letter providing Compliance and Registrant Regulation Branch (“CRR Branch”) Staff with notice (“Notice”) of the application filed under section 11.9 and 11.10 of National Instrument 31-103 – Registration Requirements, Exemptions and Ongoing Registrant Obligations (“NI 31-103”) relating to the First Transaction and the Second Transaction (collectively, the “Transactions”);
AND WHEREAS on November 5, 2013, the staff member of the CRR Branch conducting the review of the Notice requested copies of the affidavits of Michael Denyszyn sworn May 24 and June 24, 2013, the affidavits of Michael Ho sworn July 17, August 22 and October 8, 2013, the affidavits of Stuart McKinnon sworn July 17, August 23 and October 7, 2013, the affidavit of Kenneth White sworn October 7, 2013 and the submissions of Staff and Pro-Financial Asset Management Inc. (“PFAM”) (collectively, the “Confidential Documents”);
AND WHEREAS on November 12, 2013, PFAM filed an application with the Investment Funds Branch (“IF Branch”) of the Commission for an order under section 5.5 of National Instrument 81-102 – Mutual Funds (“NI 81-102”) for approval of the Purchaser as investment fund manager of the Pro-Index Funds and the Purchaser applied on October 24, 2013 for registration in the investment fund manager category for this purpose;
AND WHEREAS on November 13, 2013, Staff filed a Notice of Motion returnable on a date to be determined by the Secretary’s office seeking an Order that Staff of the Enforcement Branch be permitted to provide some or all of the Confidential Documents to certain staff members of the CRR Branch and the IF Branch;
AND WHEREAS on November 25, 2013, the Commission ordered that:
(i) Staff of the Enforcement Branch be permitted to provide the Confidential Documents to the following persons:
a. the staff members of the CRR Branch assigned to review the Notice;
b. the staff member who has been designated to act in the capacity of the Director on behalf of the CRR Branch for the purposes of deciding whether to object to the Notice;
c. the staff members of the IF Branch who have been assigned to review the application made by PFAM or the Purchaser under section 5.5 of NI 81-102; and
d. the staff member who has been designated to act in the capacity of the “Director” for the purposes of deciding whether to approve the application under section 5.5 of NI 81-102;
(ii) The CRR staff members assigned to review the Notice be permitted to provide relevant information derived from the Confidential Documents (“Relevant Information”) to PFAM, the Purchaser and their counsel involved in the Notice as part of the CRR staff members’ review and analysis of the Notice on condition that the recipients of such information treat it as confidential and not provide it to any third party without further direction or order of the Commission;
(iii) The IF staff members assigned to review the application for change of fund manager be permitted to provide Relevant Information to PFAM, the Purchaser and their counsel involved in the application filed under NI 81- 102 as part of the Investment Funds staff members’ review and analysis of the application on condition that the recipients of such information treat it as confidential and not provide it to any third party without further direction or order of the Commission;
(iv) The CRR staff members assigned to review the Notice be permitted to provide Relevant Information to the Investor or its counsel with the consent of PFAM; and
(v) The parties may seek direction from the Commission in the event that the CRR staff members and PFAM cannot agree on whether Relevant Information should be provided to the Investor or its counsel;
November 27, 2014 (2014), 37 OSCB 10470
Decisions, Orders and Rulings
AND WHEREAS Staff has filed an affidavit of Michael Ho sworn December 10, 2013 attaching a letter from counsel to The Investment Administration Solution Inc. (“IAS”), PFAM’s recordkeeper for the PPNs, requesting a copy of the PPN reconciliation report submitted by PFAM to Staff;
AND WHEREAS PFAM’s counsel provided to Staff and to the Commission and made submissions based on an affidavit of Stuart McKinnon sworn December 11, 2013 which was not marked as an exhibit on December 12, 2013 at the Commission hearing held that day;
AND WHEREAS on December 12, 2013, Staff and counsel for PFAM appeared before the Commission and made submissions on: (i) the appropriate form of order to govern the provision of the Confidential Documents to other members of Staff of the Commission; and (ii) whether IAS should receive copies of the PPN reconciliation reports submitted by PFAM to Staff;
AND WHEREAS by Commission Order dated December 13, 2013, the Commission ordered that:
(i) the Confidential Documents may be provided to any member of Staff of the Commission, as necessary in the course of their duties;
(ii) the Temporary Order be extended to January 24, 2014;
(iii) the hearing be adjourned to January 21, 2014 at 11:00 a.m.; and
(iv) Staff shall be entitled to provide a copy of each document relating to the PPN reconciliation process listed on Schedule “A” of the October 13, 2013 order to counsel for IAS on the conditions that: (a) IAS treat those documents as confidential and not provide them to any third party without further direction or order of the Commission; and (b) IAS may use the documents for the purpose of assisting Staff in resolving the PPN discrepancy, and for no other purpose;
AND WHEREAS on January 15, 2014, PFAM’s counsel advised Staff that the prospectus for the distribution of securities of the Pro- Index Funds had passed its lapse date on January 14, 2014 and PFAM’s counsel requested a lapse date extension of 40 days from Staff;
AND WHEREAS on January 17, 2014, PFAM’s counsel filed a pre-hearing conference memorandum (“PFAM’s Pre- Hearing Memorandum”) with the Secretary’s office to discuss various issues and seek an Order granting an extension to the lapse date for the Pro-Index Funds under subsection 62(5) of the Act (the “Lapse Date Relief”);
AND WHEREAS PFAM filed the affidavit of Stuart McKinnon sworn January 19, 2014 with the Secretary’s office and Staff filed the affidavit of Susan Thomas sworn January 20, 2014 with the Secretary’s office but neither party marked either affidavit as an exhibit at the appearance on January 21, 2014;
AND WHEREAS on January 21, 2014, Staff and PFAM’s counsel appeared before the Commission and Staff advised the Commission that: (i) Staff’s review of the Notice was expected to take another three to four weeks; (ii) the parties agreed that the prior confidentiality orders should be revised to permit Staff to provide the Confidential Documents or excerpts therefrom to the Purchaser, the Investor and their counsel as Staff determines necessary in the course of their duties and on the condition that the recipients treat such documents as confidential and not disclose them to any third party without further direction or order of the Commission; and (iii) the parties agreed that the Temporary Order should be extended;
AND WHEREAS on January 21, 2014, PFAM’s counsel requested that submissions relating to the issues raised in PFAM’s Pre-Hearing Memorandum be made in camera pursuant to Rule 6 of the Commission’s Rules of Procedure, Staff opposed PFAM’s request, and the Commission directed and the parties made submissions in camera on the Lapse Date Relief;
AND WHEREAS on January 21, 2014, the Commission ordered that: (i) the Temporary Order be extended to February 24, 2014; (ii) the hearing be adjourned to February 21, 2014 at 2:00 p.m.; (iii) Staff who have received the Confidential Documents be permitted to provide the Confidential Documents or an excerpt of the Confidential Documents to the Purchaser, the Investor and their counsel as set out in the Order; and (iv) PFAM be granted the Lapse Date Relief under subsection 62(5) of the Act to extend the lapse date for the Pro-Index Funds to February 24, 2014 on the conditions set out in the Order;
AND WHEREAS on February 14, 2014, PFAM’s counsel served on Staff and filed a pre-hearing conference memorandum with the Secretary’s office and requested a confidential pre-hearing conference during the week of February 24, 2014;
November 27, 2014 (2014), 37 OSCB 10471
Decisions, Orders and Rulings
AND WHEREAS on February 21, 2014, PFAM’s counsel was unavailable to attend before the Commission so the Commission ordered: (i) the Temporary Order be extended to March 6, 2014; (ii) the hearing be adjourned to March 3, 2014 at 11:00 a.m.; and (iii) a confidential pre-hearing conference proceed on February 25, 2014 at 3:30 p.m.;
AND WHEREAS PFAM’s counsel requested in his prehearing conference memorandum an extension to the lapse date for the Pro-Index Funds which was previously extended to February 24, 2014 by Commission order dated January 21, 2014 (the “Further Lapse Date Relief”);
AND WHEREAS in connection with a confidential pre-hearing conference on February 25, 2014 and the appearance on March 3, 2014, Staff filed the affidavit of Michael Ho sworn February 24, 2014 and written submissions dated February 28, 2014 to oppose the request for the Further Lapse Date Relief and PFAM’s counsel filed the affidavits of Stuart McKinnon sworn February 21, 2014 and March 3, 2014 and a factum dated March 3, 2014 in support of the Further Lapse Date Relief;
AND WHEREAS on March 3, 2014, counsel for PFAM requested that submissions relating to the Further Lapse Date Relief be heard in camera and the Commission agreed to this request and the parties made oral submissions in camera on the issue of whether the Commission should grant the Further Lapse Date Relief;
AND WHEREAS on March 3, 2014, the Commission ordered that the Further Lapse Date Relief would be granted until April 7, 2014 subject to: (i) PFAM issuing a news release, in a form satisfactory to Staff, to ensure that investors receive full disclosure of the matters identified by Staff as set out below; and (ii) PFAM only being permitted to distribute securities of the Pro-Index Funds to existing securityholders of the Pro-Index Funds;
AND WHEREAS on March 3, 2014, the Commission advised, in the public portion of the hearing, that there had been two Director decisions recently made affecting PFAM (the “Director Decisions”) and PFAM’s counsel advised that the affected parties would seek a hearing and review under subsection 8(2) of the Act of both of the Director Decisions on an expedited basis;
AND WHEREAS on March 4, 2014, the Commission ordered: (i) the terms and conditions imposed on PFAM’s registration by the Temporary Order be deleted and replaced with new terms and conditions which provided that PFAM shall not accept any new clients or open any new client accounts of any kind in respect of its Managed Accounts and that PFAM may only distribute securities of the Pro-Index Funds to existing securityholders of the Pro-Index Funds (the “Distribution Restriction”); (ii) PFAM be granted the Further Lapse Date Relief under subsection 62(5) of the Act to extend the lapse date for the Pro-Index Funds to April 7, 2014 subject to the conditions that: (a) PFAM issue a news release by March 6, 2014, in a form satisfactory to Staff, providing disclosure about the specific items set out in the March 4, 2014 order; and (b) PFAM comply with the terms of the March 4, 2014 order; (iii) the hearing be adjourned to April 7, 2014 at 10:00 a.m.; and (iv) the Temporary Order be extended to April 10, 2014;
AND WHEREAS on March 6, 2014, a confidential prehearing conference was held to consider a motion by counsel to the Purchaser and the Investor to vary the Distribution Restriction imposed by the Commission in the March 4, 2014 order, so that PFAM could continue distributing securities until April 7, 2014 to new investors after issuing the press release provided for in the March 4 order (the “Variation Motion”);
AND WHEREAS on March 6, 2014, the Commission was of the view that the hearing of the Variation Motion should proceed only after a notice of the Variation Motion has been filed with the Secretary’s office so that the public could be advised of the hearing;
AND WHEREAS on March 6, 2014, the Commission ordered that: (i) portions of the Commission decision of March 3, 2014 imposing the Distribution Restriction and deleting and replacing the terms and conditions on PFAM’s registration and operation be stayed until March 11, 2014; (ii) PFAM be granted lapse date relief to extend the lapse date for the Pro-Index Funds to March 11, 2014; (iii) the Purchaser and the Investor file notice of the Variation Motion with the Secretary’s office; and (iv) the Variation Motion be adjourned to March 11, 2014 at 1:00 p.m.;
AND WHEREAS the Purchaser and Investor’s counsel filed the affidavit of Diego Beltran sworn March 5, 2014, the affidavit of Stuart McKinnon sworn March 11, 2014 and written submissions dated March 6, 2014 in support of the Variation Motion and Staff filed the affidavit of Michael Ho sworn March 10, 2014 and written submissions dated March 10, 2014 to oppose the Variation Motion;
AND WHEREAS on March 11, 2014, the Purchaser and the Investor’s counsel made a request that the hearing of the Variation Motion proceed in camera and Staff opposed the request and the Purchaser and Investor’s counsel and Staff made oral submissions and the Commission denied the request that the hearing proceed in camera;
November 27, 2014 (2014), 37 OSCB 10472
Decisions, Orders and Rulings
AND WHEREAS on March 11, 2014, Staff opposed the Variation Motion and the Purchaser and Investor’s counsel and Staff made oral submissions on the Variation Motion and Staff advised that a separate order will be required to cease the distribution of securities of the Pro-Index Funds to new investors as of March 11, 2014 if the Variation Motion is dismissed;
AND WHEREAS on March 11, 2014, the Commission ordered that: (i) the Variation Motion be dismissed; and (ii) the distribution of securities of the Pro-Index Funds to new investors be ceased as of the end of the day on March 11, 2014;
AND WHEREAS PFAM filed the affidavit of Stuart McKinnon sworn April 4, 2014 in support of its request for a further lapse date extension (the “Third Lapse Date Extension Request”) and requested that the affidavit be treated on a confidential basis and Staff filed an affidavit of Mostafa Asadi sworn April 4, 2014 and opposed the Third Lapse Date Extension Request on the basis that PFAM has not filed the annual audited financial statements or the annual management reports of fund performance for the Pro-Index Funds which were due on March 31, 2014;
AND WHEREAS on April 7, 2014, PFAM’s counsel requested that the submissions of the parties be heard in camera and Staff opposed the request and the Commission directed PFAM’s counsel and Staff to make oral submissions in camera;
AND WHEREAS on April 7, 2014, Staff requested permission to provide a copy of the affidavit of Stuart McKinnon sworn April 4, 2014 to IAS or its legal counsel prior to the argument of PFAM’s Third Lapse Date Request and PFAM’s counsel opposed Staff’s request;
AND WHEREAS on April 7, 2014, the parties made submissions in camera and the Commission directed that the affidavit of Stuart McKinnon sworn April 4, 2014 shall not be received on a confidential basis and directed that the correspondence between Staff and PFAM’s counsel be treated as confidential;
AND WHEREAS on April 7, 2014, the Commission ordered that: (i) the lapse date for the Pro-Index Funds be extended to April 21, 2014; (ii) the affidavit of Stuart McKinnon sworn April 4, 2014 shall appear on the public record except for exhibits containing the correspondence between Staff and PFAM’s counsel, including enclosures; (iii) Staff shall be entitled to provide a copy of the affidavit of Stuart McKinnon sworn April 4, 2014 to IAS or IAS’ legal counsel subject to the conditions that IAS shall treat as confidential all correspondence between PFAM and Staff forming part of the affidavit and IAS shall only use the affidavit to assist Staff in the ongoing proceeding; (iv) the Temporary Order be extended to April 21, 2014; and (v) the hearing be adjourned to April 17, 2014 at 11:00 a.m. to argue the Third Lapse Date Extension Request.
AND WHEREAS on April 17, 2014, Staff filed the affidavit of Michael Ho sworn April 11, 2014 to oppose the Third Lapse Date Extension Request and PFAM filed the affidavit of Stuart McKinnon sworn April 16, 2014 in support of the Third Lapse Date Extension Request;
AND WHEREAS on April 17, 2014, PFAM’s counsel requested that the submissions of the parties on the Third Lapse Date Extension Request be heard in camera and Staff opposed PFAM’s request and the Commission directed that the parties’ submissions on the Third Lapse Date Extension Request would not be heard in camera;
AND WHEREAS on April 17, 2014, PFAM’s counsel made oral submissions and filed written submissions dated April 7 and 17, 2014 in support of the Third Lapse Date Extension Request and Staff made oral and filed written submissions dated April 14, 2014 to oppose PFAM’s request and after hearing the parties’ submissions, the Commission reserved its decision and adjourned the hearing to April 21, 2014 at 2:00 p.m.;
AND WHEREAS on April 21, 2014, the Commission dismissed the Third Lapse Date Extension Request and provided oral reasons for its decision;
AND WHEREAS on April 21, 2014, the Commission ordered that: (i) the Third Lapse Date Extension Request be dismissed without prejudice to PFAM bringing an application under section 144 to vary or revoke this order if the audited financial statements and management reports of fund performance for the Pro-Index Funds are filed with the Commission; (ii) notwithstanding that the lapse date for the Pro-Index Funds was previously extended to April 21, 2014, the distribution of securities of the Pro-Index Funds shall cease as of the end of the day on April 21, 2014; (iii) the Temporary Order be extended to May 27, 2014; and (iv) the hearing be adjourned to May 23, 2014 at 10:00 a.m.;
AND WHEREAS on May 23, 2014, Staff filed the affidavit of Michael Ho sworn May 22, 2014 to: (i) update the Commission on the payments by PFAM on March 31, April 7 and 8, 2014 of maturity proceeds for certain series of PPNs to an escrow agent as arranged by the Banks and agreed to by PFAM; and (ii) confirm that the current discrepancy between the records of the recordkeeper and the trustee remains unchanged and indicates that the total cash obligation to PPN noteholders exceeds the amount in the trustee’s records by $1,222,549.45;
AND WHEREAS on May 23, 2014, the Commission ordered that: (i) the term and condition on PFAM’s registration which stated that “PFAM may only distribute securities of the Pro-Index Funds to existing security holders of the Pro-Index
November 27, 2014 (2014), 37 OSCB 10473
Decisions, Orders and Rulings
Funds” be deleted and replaced with “PFAM shall not distribute securities of the Pro-Index Funds”; (ii) a confidential pre-hearing conference be held on June 5, 2014 at 10:00 a.m.; (iii) the hearing be adjourned to July 2, 2014 at 10:00 a.m.; and (iv) the Temporary Order be extended to July 4, 2014;
AND WHEREAS the Secretary’s office advised the parties that the Commission was not available on July 2, 2014 and the parties agreed to adjourn the hearing to July 9, 2014 at 10:00 a.m. and to extend the Temporary Order to July 11, 2014;
AND WHEREAS on June 11, 2014, the Commission ordered that: (i) a confidential pre-hearing conference in respect of the section 8 hearing and review of the Director Decisions be held on June 26, 2014 at 2:00 p.m.; (ii) the hearing be adjourned to July 9, 2014 at 10:00 a.m.; and (iii) the Temporary Order be extended to July 11, 2014;
AND WHEREAS on July 9, 2014, the Commission ordered that: (i) the hearing be adjourned to August 8, 2014 at 10:00 a.m.; and (ii) the Temporary Order as amended by previous Commission orders be extended to August 11, 2014;
AND WHEREAS on July 9 and 10, 2014, the Commission held a hearing and review under subsection 8(2) of the Act to consider the decision of the Director of the CRR Branch to object to the Transactions;
AND WHEREAS on July 16, 2014, the Commission approved the Transactions under subsections 11.9(5) and 11.10(6) of NI 31-103 subject to nine terms and conditions;
AND WHEREAS on August 8, 2014, counsel for PFAM requested a short adjournment to permit counsel with carriage of the PFAM matter to attend before the Commission to make submissions on the affidavit of Michael Ho sworn August 7, 2014;
AND WHEREAS on August 8, 2014, the Commission ordered that the Temporary Order be extended to August 29, 2014 and the hearing be adjourned to August 26, 2014 at 10:00 a.m. to hear submissions from the parties;
AND WHEREAS on August 26, 2014, Staff filed the affidavit of Michael Ho sworn August 7, 2014 to update the Commission on the complaints received by Staff from PPN noteholders and advisers to PPN noteholders and to set out Staff’s information that: (i) in June 2014, PFAM resigned as administrator for the PPNs issued by the Banks; (ii) eight of the nine series of PPNs have matured; (iii) two series of PPNs have been paid out to PPN noteholders at maturity in 2010 and 2011; (iv) in March and April, 2014, the maturity proceeds for five series of PPNs which matured between December 2012 and March 31, 2014 inclusive were paid to escrow accounts at the BMO Trust Company (“BMO Trust”); (v) one series of PPNs matured on June 30, 2014 and the maturity proceeds have been paid to BMO Trust; (vi) BNP has advised Staff that BNP intends to fund the shortfall and to pay the PPN noteholders the full redemption amounts on the matured series of PPNs issued by BNP; (vii) SGC has advised Staff that SGC has paid the full proceeds payable upon maturity for the matured series of PPNs issued by SGC and such funds are being held in escrow at BMO Trust; (viii) BNP has advised Staff that BNP is currently making the necessary administrative arrangements to make payments to PPN noteholders directly; and (ix) SGC has advised Staff that SGC is carefully reviewing the registers and other records available to identify PPN noteholders and SGC will make arrangement for payment once sufficient reliable information is available;
AND WHEREAS on August 26, 2014, the Commission ordered that the Temporary Order be extended to October 1, 2014 and the hearing be adjourned to September 29, 2014 at 10:00 a.m.;
AND WHEREAS on September 24, 2014, the Commission rescheduled the PFAM hearing from September 29, 2014 at 10:00 a.m. to September 30, 2014 at 12:30 p.m.;
AND WHEREAS on September 30, 2014, the Commission ordered that the Temporary Order be extended to November 24, 2014 and the hearing be adjourned to November 20, 2014 at 10:00 a.m.;
AND WHEREAS on November 20, 2014, Staff updated the Commission on: (i) the efforts of SGC and IAS to reach an agreement for access to IAS’s PPN noteholder records; and (ii) the status of PFAM’s and KCC’s change of manager application;
AND WHEREAS on November 20, 2014, Staff and PFAM’s counsel advised that the parties consent to the adjournment of the hearing to January 14, 2015 and to the extension of the Temporary Order to January 16, 2015 and the Commission advised that the matter should be brought back before the Commission earlier than January 14, 2015 if: (i) SGC and IAS fail to reach an agreement within two weeks; and/or (ii) PFAM’s and KCC’s change of manager application is not approved;
AND WHEREAS the Commission is of the opinion that it is in the public interest to make this order;
IT IS HEREBY ORDERED that:
1. The hearing is adjourned to January 14, 2015 at 9:00 a.m.
November 27, 2014 (2014), 37 OSCB 10474
Decisions, Orders and Rulings
2. The Temporary Order as amended by previous Commission orders is extended to January 16, 2015.
DATED at Toronto this 20th day of November, 2014
“James E. A. Turner”
November 27, 2014 (2014), 37 OSCB 10475
Decisions, Orders and Rulings
2.2.3 TG Residential Value Properties Ltd. – ss. 127(7), 127(8)
IN THE MATTER OF THE SECURITIES ACT, R.S.O. 1990, c. S.5, AS AMENDED
AND
IN THE MATTER OF TG RESIDENTIAL VALUE PROPERTIES LTD.
ORDER (Subsections 127(7) and 127(8))
WHEREAS the British Columbia Securities Commission (the “BCSC”) issued a Cease Trade Order on November 5, 2014, ordering that all the trading in the securities of TG Residential Value Properties Ltd. (the “Reporting Issuer”), cease due to a failure to file the following required continuous disclosure documents:
(i) comparative financial statement for its financial year ended June 30, 2014; and
(ii) the management discussion and analysis for the period ended June 30, 2014.
AND WHEREAS the order of the BCSC remains in effect until the Executive Director of the BCSC revokes the order or the Reporting Issuer completes the required filings;
AND WHEREAS the Director of the Corporate Finance Branch of the Ontario Securities Commission (the “Commission”), issued a Notice of Hearing and a Temporary Cease Trade Order (the “TCTO”) on November 10, 2014, pursuant to paragraph 2 of subsection 127(1) and subsection 127(5) of the Securities Act, R.S.O. 1990, c. S.5, as amended (the “Act”), reciprocating the order of the BCSC, and ordering that, effective immediately, all trading in the securities of the Reporting Issuer, whether direct or indirect, shall cease for a period of 15 days from the date of the TCTO;
AND WHEREAS a Hearing was held on November 21, 2014, in writing, to consider whether the TCTO should be extended;
AND WHEREAS the Commission considered the consent of the Reporting Issuer and Staff of the Commission and submissions of the Reporting Issuer and Staff of the Commission;
AND WHEREAS the Commission is of the opinion that it is in the public interest to make this order;
IT IS ORDERED THAT Pursuant to subsection 127(7) the TCTO be extended until December 4, 2014;
IT IS FURTHER ORDERED THAT the hearing in this matter be adjourned until December 1, 2014, at 10:00 a.m.
DATED at Toronto this 21st day of November, 2014
“Mary G. Condon”
November 27, 2014 (2014), 37 OSCB 10476
Decisions, Orders and Rulings
2.2.4 TMX Group Limited et al. – s. 147
IN THE MATTER OF THE SECURITIES ACT, R.S.O. 1990, CHAPTER S.5, AS AMENDED (Act)
AND
IN THE MATTER OF TMX GROUP LIMITED
AND
TMX GROUP INC.
AND
TSX INC.
AND
ALPHA TRADING SYSTEMS LIMITED PARTNERSHIP
AND
ALPHA EXCHANGE INC.
ORDER (Section 147 of the Act)
WHEREAS the Ontario Securities Commission (“Commission”) issued an order dated April 3, 2000 (the “2000 Order”), recognizing each of TSX Group Inc., which later changed its name to TMX Group Inc. (“TMX Group”), and TSX Inc. (“TSX”) as a stock exchange pursuant to section 21 of the Securities Act (Ontario) (the “Act”), which order has been amended from time to time;
AND WHEREAS the Commission issued an order dated December 8, 2011, recognizing each of Alpha Trading Systems Limited Partnership (“Alpha LP”) and Alpha Exchange Inc. (“Alpha Exchange”) as an exchange pursuant to section 21 of the Act (the “2011 Alpha Order”), which order has been amended from time to time;
AND WHEREAS, in connection with the take-over bid and a subsequent arrangement, the result of which would be the acquisition by TMX Group Limited, then known as the Maple Group Acquisition Corporation (“Maple”), of all of the issued and outstanding voting securities of TMX Group, the holding company parent of TSX, pursuant to section 144 of the Act, the Commission issued an order (the “Maple Order”) dated July 4, 2012 revoking the 2000 Order and the 2011 Alpha Order and pursuant to section 21 of the Act recognizing each of Maple, TMX Group, TSX, Alpha LP and Alpha Exchange (collectively the “Recognized Exchanges”) as an exchange;
AND WHEREAS the Recognized Exchanges have applied to the Commission for exemptive relief pursuant to section 147 of the Act from complying with the following requirements (together, the “Reporting Requirements”) at:
a) subsection 2(c) of Schedule 2;
b) subsection 2(a) of Appendix A of Schedule 2;
c) subparagraph 34(b)(iii) of Schedule 5;
d) subparagraph 52(b)(iii) of Schedule 7; and
e) subsection 62(b) of Schedule 8 of the Maple Order (the “Application”);
November 27, 2014 (2014), 37 OSCB 10477
Decisions, Orders and Rulings
AND WHEREAS based on the Application and the representations that the Recognized Exchanges have made to the Commission, the Commission has determined that it is not prejudicial to the public interest to exempt the Recognized Exchanges from complying with the Reporting Requirements;
IT IS HEREBY ORDERED that pursuant to section 147 of the Act, the Recognized Exchanges are exempted from the Reporting Requirements.
DATED this 14th day of November 2014.
“Edward P. Kerwin”
“Deborah Leckman”
November 27, 2014 (2014), 37 OSCB 10478
Chapter 4
Cease Trading Orders
4.1.1 Temporary, Permanent & Rescinding Issuer Cease Trading Orders
Company Name Date of Temporary Date of Hearing Date of Permanent Date of Order Order Lapse/Revoke
Five Nines Ventures Ltd. 10 November 14 21 November 14 21 November 14
Galileo Webtrack Systems 11 November 14 24 November 14 25 November 14 Corp.
NovaDx Ventures Corp. 10 November 14 21 November 14 21 November 14
Sonde Resources Corp. 25 November 14 08 December 14
TG Residential Value 10-November-14 21-November-14* Properties Ltd.
* The Temporary order issued on November 10, 2014 was extended by the Commission on November 21, 2014 to December 1, 2014.
4.2.1 Temporary, Permanent & Rescinding Management Cease Trading Orders
Company Name Date of Order or Date of Hearing Date of Date of Date of Temporary Permanent Lapse/ Issuer Order Order Expire Temporary Order
Northland Resources SE 21 November 14 3 December 14
4.2.2 Outstanding Management & Insider Cease Trading Orders
Company Name Date of Order Date of Hearing Date of Date of Lapse/ Date of or Temporary Permanent Expire Issuer Order Order Temporary Order
Besra Gold Inc. 10 October 14 22 October 14 22 October 14
Northland Resources SE 21 November 14 3 December 14
November 27, 2014 (2014), 37 OSCB 10479
Cease Trading Orders
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November 27, 2014 (2014), 37 OSCB 10480
Chapter 5
Rules and Policies
5.1.1 Notice of Amendments to OSC Rule 45-501 Ontario Prospectus and Registration Exemptions
The Notice of Amendments to OSC Rule 45-501 Ontario Prospectus and Registration Exemptions is reproduced on the following internally numbered pages. Bulletin pagination resumes at the end of the Notice.
November 27, 2014 (2014), 37 OSCB 10481
Rules and Policies
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November 27, 2014 (2014), 37 OSCB 10482
NOTICE OF AMENDMENTS TO ONTARIO SECURITIES COMMISSION RULE 45-501 ONTARIO PROSPECTUS AND REGISTRATION EXEMPTIONS
November 27, 2014
Introduction
We, the Ontario Securities Commission (OSC or we), are implementing amendments (the Rule Amendments) to OSC Rule 45-501 Ontario Prospectus and Registration Exemptions (OSC Rule 45-501).
We are also implementing: • policy changes (the Policy Changes) to Companion Policy 45-501CP to OSC Rule 45-501 (45-501CP), and • consequential amendments (the Consequential Amendments) to National Instrument 45-102 Resale of Securities.
The OSC published the Rule Amendments, along with other proposed prospectus exemptions and proposed reports of exemption distribution, for comment on March 20, 2014. On November 4, 2014, the OSC: • made the Rule Amendments and the Consequential Amendments pursuant to section 143 of the Securities Act (Ontario) (the Act), and • adopted the Policy Changes to 45-501CP pursuant to section 143.8 of the Act.
The Rule Amendments, Policy Changes and Consequential Amendments (collectively, the Final Amendments) were delivered to the Minister of Finance on November 26, 2014. Provided Ministerial approval is obtained, the Final Amendments will come into force on February 11, 2015.
Substance and Purpose of the Rule Amendments
The Final Amendments set out a prospectus exemption for distributions by a reporting issuer (other than an investment fund) listed on a specified exchange to its existing security holders (the Existing Security Holder Prospectus Exemption or the Exemption).
Many small and medium-sized enterprises (SMEs) continue to face challenges raising capital after becoming reporting issuers and obtaining a listing on an exchange. Furthermore, retail security holders often have less opportunity to invest in primary offerings by listed issuers, even if they have already made an investment decision to acquire an issuer’s securities in the secondary market. The Existing Security Holder Prospectus Exemption will provide investors, who have already acquired securities of a listed issuer, with the opportunity to participate in primary offerings of that issuer. The Exemption is available to reporting issuers with equity securities listed on the Toronto Stock Exchange (TSX), the TSX Venture Exchange (TSXV), the Canadian Securities Exchange (CSE) or Aequitas NEO Exchange (Aequitas) (collectively, the Exchanges).
Background
The OSC engaged in a broad review of the exempt market (the Exempt Market Review) to consider whether to introduce new prospectus exemptions that would facilitate capital raising for business enterprises, particularly SMEs, while protecting the interests of investors.
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In connection with the Exempt Market Review, on March 20, 2014, the OSC published for comment, proposals for four new capital raising prospectus exemptions in Ontario (the Proposed Exemptions): • an offering memorandum prospectus exemption, • a family, friends and business associates prospectus exemption, • the Existing Security Holder Prospectus Exemption, and • a crowdfunding prospectus exemption in addition to regulatory requirements applicable to a crowdfunding portal.
The OSC also published a proposal for two new reports of exempt distribution for use in Ontario and certain other jurisdictions (the Proposed Reports): • Form 45-106F10 Report of Exempt Distribution For Investment Fund Issuers (Alberta, New Brunswick, Ontario and Saskatchewan), and • Form 45-106F11 Report of Exempt Distribution For Issuers Other Than Investment Funds (Alberta, New Brunswick, Ontario and Saskatchewan).
Additional background information on the Proposed Exemptions and the Proposed Reports is available in the notice we published on March 20, 2014. The comment period for these proposals expired on June 18, 2014 and OSC staff are currently reviewing the comments related to the other Proposed Exemptions and the Proposed Reports.
As noted above, the Existing Security Holder Prospectus Exemption (the Proposed Amendments) was published for comment as one of the Proposed Exemptions in Ontario only on March 20, 2014. All other CSA jurisdictions (other than Newfoundland and Labrador) published a similar exemption in final form on March 13, 2014 (the CSA Existing Security Holder Prospectus Exemption). The CSA Existing Security Holder Prospectus Exemption has been adopted by rule in each of Alberta and Québec, and as a blanket order in each of British Columbia, Saskatchewan, Manitoba, Nova Scotia, New Brunswick, Prince Edward Island, Yukon, the Northwest Territories and Nunavut. See Multilateral CSA Notice 45-313 Prospectus Exemption for Distributions.
In developing the Final Amendments (and in connection with the Exempt Market Review), we conducted consultations with various stakeholders including OSC advisory committees. To facilitate harmonization between the CSA Existing Security Holder Prospectus Exemption and the Existing Security Holder Prospectus Exemption, we also consulted with other CSA members. As a result, the Existing Security Holder Prospectus Exemption is similar to and substantially harmonized with the CSA Existing Security Holder Prospectus Exemption.
Framework of the Existing Security Holder Prospectus Exemption
The Existing Security Holder Prospectus Exemption permits listed issuers to distribute securities to their existing security holders, subject to a number of conditions. The key conditions are set out below:
Element of exemption Details Issuer restrictions
Qualification criteria • Reporting issuers with a class of equity securities listed on one or more of the Exchanges • Not available to investment funds Distribution details
Types of securities • The Exemption applies to a distribution by an issuer of securities of its own issue • Offering can consist only of the class of equity securities listed on one or more of the Exchanges, or units consisting of the listed security and a warrant to acquire the listed security 3
Element of exemption Details
Offering parameters • An offering cannot result in an increase of more than 100% of the outstanding securities of the same class • Issuer must permit each person who, as of the record date, held a listed security of the issuer of the same class and series as the listed security to be distributed under the Exemption, to subscribe for securities distributed under the Exemption • No requirement that an issuer must allocate existing security holders a pro rata portion of the offering
Registrants • There are no restrictions that limit the type of registrant that may participate in an offering under the Exemption Investor protection measures
Investor qualifications • Each investor must represent in writing to the issuer that as at the record date the investor held, and continues to hold, the type of listed security that the investor is acquiring under the Exemption • The record date must be at least one day prior to the day that an issuer issues an offering news release Investment limits Either: • The aggregate of the acquisition cost to the purchaser of securities to be purchased from the issuer under the distribution, when added to the acquisition cost to the purchaser of all other securities of the issuer acquired in reliance on the Exemption in the 12-month period immediately preceding the distribution, does not exceed $15,000, or • The purchaser has obtained advice regarding the suitability of the investment and, if the purchaser is a resident of a jurisdiction of Canada, that advice is from a person registered in that jurisdiction as an investment dealer
Risk acknowledgement • A risk acknowledgement form is not required form
Point of sale disclosure • Issuer is not required to provide an offering document • Issuer must issue an offering news release that includes reasonable detail of the proposed distribution, the proposed use of proceeds and a description of how the issuer intends to allocate securities • Issuer must file any offering materials (other than the subscription agreement) on the same day the issuer provides materials to purchasers
Statutory rights in the • Secondary market civil liability provisions in Part XXIII.1 of the Act (Secondary event of a Market Disclosure Liability) applies in relation to securities purchased under the misrepresentation Existing Security Holder Prospectus Exemption
Right of withdrawal • No right of withdrawal is available to investors
Resale restrictions • Securities of a reporting issuer are subject to a four month hold period (subject to certain other conditions being met)
Ongoing disclosure • Reporting issuers must comply with continuous disclosure obligations Reporting
Reporting of distribution • Report of exempt distribution in Form 45-106F1 Report of Exempt Distribution (Form 45-106F1) must be filed for a distribution 4
Summary of Written Comments Received by the OSC
The comment period for the Proposed Amendments ended on June 18, 2014. We received written submissions on the Proposed Amendments from 14 commenters. We have considered the comments received and thank all of the commenters for their comments. The names of the commenters are contained in Appendix A and a summary of their comments, together with our responses, is contained in Appendix B. The comment letters can be viewed on the OSC website at www.osc.gov.on.ca.
Summary of Changes to the Proposed Amendments
After considering the comments received on the Proposed Amendments and the comments we received during our informal consultations, we have made some revisions to the Proposed Amendments. Those revisions are reflected in the Final Amendments that we are publishing concurrently with this notice. As these changes are not material, we are not republishing the Final Amendments for a further comment period.
A summary of notable changes between the Proposed Amendments and the Final Amendments is set out below in items (i) – (vi).
(i) Seasoning requirement for issuers
The Proposed Amendments contemplated that an issuer must be a reporting issuer for not less than 12 months or have become a reporting issuer by filing a prospectus before the offering (the Seasoning Requirement). The purpose of the Seasoning Requirement was to ensure that the issuer has a base disclosure record since the premise for the Exemption is to permit an existing security holder to rely on the issuer’s disclosure record to make purchasing decisions. However, this requirement resulted in a difference between the Existing Security Holder Prospectus Exemption and the CSA Existing Security Holder Prospectus Exemption.
We have removed the Seasoning Requirement after further consideration of the disclosure record of new reporting issuers available to security holders and to harmonize the Final Amendments with the CSA Existing Security Holder Prospectus Exemption.
(ii) Pro rata allocation among existing security holders
In an effort to harmonize with the CSA Existing Security Holder Prospectus Exemption, we removed the requirement that the issuer must allocate a pro rata portion of the offering to existing security holders. Instead, we have added companion policy guidance to 45-501CP in order to clarify certain matters relating to the fair and equal treatment of existing security holders. Specifically, the guidance clarifies that while there is no pro rata requirement, the OSC takes the position that in order to support the fair treatment of all security holders, an issuer should establish, maintain and apply policies and procedures that provide reasonable assurance that the issuer, and, if applicable, each registrant participating in an offering, fairly allocate investment opportunities among all of the issuer’s security holders. We are of the view that these revisions will prevent the use of the Existing Security Holder Prospectus Exemption in a manner that results in security holders suffering significant dilution without the opportunity to participate in the distribution. 5
(iii) Security holders rights if misrepresentation
The Proposed Amendments contemplated requiring that a subscription agreement between the issuer and investor provide for contractual rights against the issuer if there is a misrepresentation in the issuer’s disclosure record (Contractual Liability). We also noted in the notice and request for comment published with the Proposed Amendments that, as an alternative to Contractual Liability, we were considering prescribing that Secondary Market Disclosure Liability apply.
The Final Amendments prescribe that Secondary Market Disclosure Liability applies, which provides purchasers of securities under the Existing Security Holder Prospectus Exemption with rights of action for damages, under section 138.3 of the Act, relating to: • misrepresentations contained in documents released on behalf of an issuer, • misrepresentations in public oral statements by certain persons, and • failure of an issuer to make timely disclosure.
However, unlike Contractual Liability, we note that Secondary Market Disclosure Liability does not provide investors with a statutory right of rescission.
We believe that there are a number of advantages to providing for Secondary Market Disclosure Liability rather than Contractual Liability, including: • Under the Secondary Market Disclosure Liability regime, investors have rights of action for damages that are not available under Contractual Liability, namely, in relation to misrepresentations in public oral statements and failure of an issuer to make timely disclosure. • Rights under the Secondary Market Disclosure Liability regime are enforceable against a broader group of persons, including directors, officers, control persons and experts; whereas, Contractual Liability only applies against the issuer. • Under a Contractual Liability regime, there is a potential risk that an issuer would not set out the prescribed provisions in a subscription agreement. There is also a risk that provisions in a subscription agreement would not be consistent from issuer to issuer or from offering to offering.
(iv) Report of exempt distribution
The Proposed Amendments required an issuer relying on the Existing Security Holder Prospectus Exemption to file a Form 45-106F11. However, since the Proposed Reports are not yet in place, we have made drafting changes to require that a Form 45-106F1 be used to report a distribution under the Existing Security Holder Prospectus Exemption until the Proposed Reports are finalized.
(v) Amendments to OSC Rule 13-502 Fees
The Proposed Amendments contemplated an amendment to OSC Rule 13-502 Fees (OSC Rule 13-502). Specifically, we proposed that issuers that relied on the Existing Security Holder Prospectus Exemption would pay an activity fee of $500 at the time of filing either of the Proposed Reports, which includes the proposed Form 45-106F11. As noted above, a Form 45-106F1 is required to be filed under the Final Amendments until the Proposed Reports are finalized.
Accordingly, an issuer who relies on the Existing Security Holder Prospectus Exemption will pay the activity fee of $500, as currently required under Part B of Appendix C of OSC Rule 13-502 when filing Form 45-106F1.
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(vi) Aequitas
On November 13, 2014, the OSC recognized Aequitas as an exchange in accordance with section 21 of the Act. As such, we have updated the Rule Amendments to permit reporting issuers with a class of equity securities listed on Aequitas to use the Exemption after the effective date of the recognition order for Aequitas.
Summary of differences between the CSA Exiting Security Holder Prospectus Exemption and the Final Amendments
One difference between the CSA Existing Security Holder Prospectus Exemption and the Final Amendments is that, under the CSA Existing Security Holder Prospectus Exemption, there is no carve-out for investment funds. However, investment fund issuers in Ontario cannot rely on the Existing Security Holder Prospectus Exemption. The exclusion of investment funds is consistent with the focus of the policy initiative of the Exempt Market Review to facilitate capital raising for SMEs.
The Final Amendments also require that a distribution of listed securities or units by an issuer must not result in an increase of more than 100 percent in the number of outstanding listed securities of the same class.
Text of the Final Amendments
The text of the Final Amendments is included at Appendix C.
Questions
Please refer your questions to any of:
Jo-Anne Matear Manager, Corporate Finance (416) 593-2323 1-877-785-1555 [email protected]
Raymond Ho Accountant, Corporate Finance 416-593-8106 1-877-785-1555 [email protected]
Aba Stevens Legal Counsel, Corporate Finance 416-263-3867 1-877-785-1555 [email protected] 7
APPENDIX A LIST OF COMMENTERS
1. Advocis 2. AUM Law 3. Canadian Advocacy Council for Canadian CSA Institute Societies 4. Canadian Securities Exchange 5. Davies Ward Phillips & Vineberg LLP 6. Equity Crowdfunding Alliance of Canada 7. Canadian Foundation for Advancement of Investor Rights 8. Investment Industry Association of Canada 9. National Crowdfunding Association of Canada 10. Northcrest Partners Inc. 11. Private Capital Markets Association of Canada 12. Siskinds LLP 13. Stikeman Elliott LLP 14. TMX Group Limited
APPENDIX B SUMMARY OF COMMENTS AND OSC RESPONSES
No. Topic Comments OSC Response Harmonization 1. Support for CSA Six commenters supported harmonization between the We have consulted with other CSA members and have harmonization Existing Security Holder Prospectus Exemption and the harmonized the Exemption to the extent possible. CSA Existing Security Holder Prospectus Exemption for the following reasons: • differences between the exemptions may impede issuers, particularly SMEs, from optimizing capital raising opportunities, • inconsistent regulation creates unnecessary friction, regulatory and investor confusion, and increased costs, and • the majority of the comment letters received in connection with the CSA Existing Security Holder Prospectus Exemption supported that exemption.
The CSA Existing Security Holder Prospectus Exemption was adopted by rule in each of Alberta and Québec, and as a blanket order in each of British Columbia, Saskatchewan, Manitoba, Nova Scotia, New Brunswick, Prince Edward Island, Yukon, the Northwest Territories and Nunavut published in final form on March 13, 2014.
General 2. Support for the scope of Four commenters generally supported the Existing We acknowledge these comments of support. the Exemption Security Holder Prospectus Exemption.
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No. Topic Comments OSC Response 3. Opposition to the One commenter was opposed to the Existing Security We disagree with this comment. Exemption Holder Prospectus Exemption. This commenter was of the view that by introducing the Exemption and other The Existing Security Holder Prospectus Exemption allows prospectus exemptions, the OSC is neglecting the investors who have already acquired securities of an issuer to interest of investors in favour of issuers. acquire additional securities based on the issuer’s 0disclosure record.
We note that the Existing Security Holder Prospectus Exemption incorporates an important investor protection mechanism by prescribing that Secondary Market Disclosure Liability applies to securities acquired under the Exemption. The application of this regime provides purchasers of securities under the Exemption with a right of action for damages relating to: • misrepresentations contained in documents released on behalf of an issuer, • misrepresentations in public oral statements by certain persons, and • failure of an issuer to make timely disclosure.
Qualification criteria 4. Support for limiting the One commenter supported the availability of the We acknowledge this comment of support. use of the Existing Exemption to listed reporting issuers only. Security Holder Prospectus Exemption to listed reporting issuers only
5. Exclusion of investment Two commenters expressed that they did not Investment funds sold to retail investors are subject to a funds understand the policy rationale for excluding investment significant and robust regulatory framework that addresses funds from using the Existing Security Holder Prospectus subsequent purchases of securities of mutual funds in Exemption. continuous distribution and subsequent offerings of securities of closed-end investment funds. To permit investment funds to sell to retail investors under the 10
No. Topic Comments OSC Response Exemption without the benefit of the disclosure and product regulation that applies to retail investment funds would be inconsistent with the principles underlying this framework and with three ongoing investment fund policy initiatives: modernization of investment fund regulation, point of sale disclosure for mutual funds and the review of the cost of ownership of mutual funds.
Further, the exclusion of investment funds is consistent with the objective of this OSC policy project to introduce new prospectus exemptions that would facilitate capital raising for business enterprises, particularly SMEs.
6. Exclusion of closed-end One commenter expressed that the absence of the We note that amendments to National Instrument 81-102 investment funds Existing Security Holder Prospectus Exemption for Investment Funds published July 19, 2014 and effective investment funds will result in closed-end funds relying September 22, 2014 restrict an investment fund from issuing on rights offerings or a subsequent market offering to warrants or rights. raise capital in Ontario, at a much greater expense and time than other listed issuers. As noted above, to permit investment funds to sell to retail investors under the Existing Security Holder Prospectus Exemption without the benefit of the disclosure and product regulation that applies to retail investment funds would be inconsistent with the principles underlying existing rules and with three ongoing investment fund policy initiatives: modernization of investment fund regulation, point of sale disclosure for mutual funds and the review of the cost of ownership of mutual funds.
7. Support for Seasoning One commenter supported inclusion of the Seasoning We acknowledge this comment; however we have removed Requirement for Requirement. The commenter noted that as a current the Seasoning Requirement in the interest of harmonization. reporting issuers security holder, the investor has a pre-existing degree of familiarity with the issuer and, because of the Seasoning Requirement, there would be considerable degree of investor protection afforded by disclosure. 11
No. Topic Comments OSC Response 8. Opposition to the Two commenters did not support the Seasoning As noted above, we have removed the Seasoning Seasoning Requirement Requirement. The commenters were of the view that Requirement. the Seasoning Requirement would create a difference between the Existing Security Holder Prospectus Exemption and the CSA Existing Security Holder Prospectus Exemption.
Additionally, one commenter noted that the Seasoning Requirement does not allow for issuers that have filed a prospectus-like disclosure document required by the TSXV for either a qualifying transaction or a reverse takeover bid to use the Exemption if it has been a reporting issuer for less for a year.
One commenter was of the view that the incremental benefit of a minimum reporting history is not a sufficient reason to deviate from the CSA Existing Security Holder Prospectus Exemption.
9. Support for allowing any Eight commenters agreed with the provision that We acknowledge these comments. issuer listed on TSX, TSXV permits issuers listed on the TSX, TSXV or CSE to use the or CSE to use the Existing Existing Security Holder Prospectus Exemption since Security Holder these exchanges have a disclosure regime. Prospectus Exemption One commenter was of the view that the TSX and TSXV have rules, policies and review processes in place with respect to private placements that aim to protect existing security holders and the quality of the market.
10. Support for allowing new One commenter submitted that the Existing Security On November 13, 2014, the OSC recognized Aequitas as an recognized exchanges to Holder Prospectus Exemption should also permit the exchange in accordance with section 21 of the Act. As such, use the Existing Security distribution of equity securities listed on newly we have updated the Proposed Amendments to permit Holder Prospectus recognized exchanges. reporting issuers with a class of equity securities listed on Exemption Aequitas to use the Exemption after the effective date of the recognition order for Aequitas. 12
No. Topic Comments OSC Response 11. Support for guidance as One commenter suggested that guidance should be We do not propose to allow issuers listed on NEX to use the to whether an issuer provided as to whether securities listed on NEX would Exemption at this time. We note that the CSA Existing listed on NEX could use qualify for issuance under the Existing Security Holder Security Holder Prospectus Exemption is available to issuers the Existing Security Prospectus Exemption given that NEX is a separate listed on the TSX, TSXV or CSE. Holder Prospectus board of the TSXV. Exemption
12. Support for allowing One commenter was of the view that the OSC should We do not propose to allow issuers listed solely on non- issuers listed on non- consider expanding the exchanges upon which issuers Canadian exchanges to use the Existing Security Holder Canadian exchanges to can be listed to include non-Canadian exchanges with Prospectus Exemption at this time. use the Existing Security disclosure rules substantively similar to those governing Holder Prospectus issuers listed on Canadian exchanges. Exemption
Types of securities that can be offered under the Exemption 13. Support for equity Two commenters were of the view that equity securities We acknowledge these comments. securities being listed on must be listed on the TSX, TSXV or CSE, as this allows for TSX, TSXV or CSE or units harmonization with the CSA Existing Security Holder consisting of the listed Prospectus Exemption and provides investor protection. security and a warrant to acquire the listed security
Offering parameters 14. Support for pro rata Five commenters supported the requirement that the We acknowledge these comments. In an effort to harmonize allocation and limit on issuer must allocate existing security holders a pro rata with the CSA Existing Security Holder Prospectus Exemption, overall dilution portion of the offering. The majority of these we have removed the requirement that the issuer must commenters were of the view that the condition allocate existing security holders a pro rata portion of the supports the fair treatment of all security holders in offering. We have addressed concerns regarding the fair and terms of (i) the security holder as a member of an equal treatment of security holders with companion policy identifiable class or group deserving of investor guidance in 45-501CP. Specifically, the guidance clarifies that, protection; and (ii) security holders’ rights relative to while there is no pro rata requirement, we take the position one another. These commenters noted that requiring that in order to support the fair treatment of all security that the offer be open on a pro rata basis: holders, an issuer should establish, maintain and apply • offers anti-dilution protection to security holders, policies and procedures that provide reasonable assurance and that the issuer and each registrant (if applicable) fairly 13
No. Topic Comments OSC Response
• could help alleviate concerns that an investor could allocate investment opportunities among all of the issuer’s purchase a nominal number of shares prior to the security holders. We are of the view that the guidance will announcement of the offering by the issuer where mitigate the risk of the Existing Security Holder Prospectus such investor might not exercise the appropriate Exemption being used in a manner that results in security level of due diligence for a more substantial holders suffering a significant dilution without the investment in the issuer. opportunity to participate in the distribution.
15. Support for additional One commenter suggested that an investor should have We acknowledge these comments. Please see response 14 pro rata allocation the ability to purchase additional securities consistent above. provisions with their existing security holdings. This would help ensure that the investor has the wherewithal to make the investment and, more importantly, protect investors from potential manipulation by less scrupulous actors.
Another commenter noted that the private placement rules of the TSXV should be made an integral part of the Existing Security Holder Prospectus Exemption so as to be enforceable by the regulators.
One commenter noted that if the OSC proceeds with the pro rata requirement, in order to lessen the complexity of compliance, listed issuers should be able to rely on a written representation from the investor regarding the number of securities held as at the record date, similar to the confirmation being proposed regarding assurance that the investor is a security holder as at the record date.
Another commenter indicated that if the OSC required pro rata allocation, in order to allow issuers to rely on an investor certificate representing the investor’s security holdings as of the record date, 45-106CP should include additional language to exempt issuers from the obligation to perform diligence to ensure that an investor is qualified to rely on the Exemption to purchase the number of securities for which the investor has subscribed. 14
No. Topic Comments OSC Response 16. Opposition to pro rata Five commenters did not support the issuer allocating We acknowledge these comments. Please see response 14 allocation existing security holders a pro rata portion of the above. offering. The majority of these commenters were of the view that the Existing Security Holder Prospectus Exemption should be harmonized with the CSA Existing Security Holder Prospectus Exemption in order to ensure that issuers and existing investors have the opportunity to use this capital raising tool in an efficient and effective way.
Some of these commenters were of the view that the pro rata allocation requirement: • is one of the reasons reporting issuers do not use the existing rights offering exemption in Canada, • is timely and costly for small issuers, and • could put Ontario-based issuers and investors at a disadvantage or otherwise make the Exemption unattractive since the Existing Security Holder Prospectus Exemption is different from the CSA Existing Security Holder Prospectus Exemption.
One commenter indicated that under the current private placement regime, there is no requirement dictating from whom and to what extent listed issuers can accept subscriptions, provided that a valid prospectus exemption under National Instrument 45-106 Prospectus and Registration Exemptions (NI 45-106) is relied upon, and if applicable, that the private placement is compliant with the relevant stock exchange’s requirements. Additionally, another commenter stated that it would be difficult to implement the pro rata requirement in the context of private placements since a significant number of security holders are objecting beneficial owners and given the current restrictions regarding listed issuers’ ability to communicate directly with objecting beneficial owners, it may not be possible to undertake a private placement on a pro rata basis in a timely and cost-efficient matter 15
No. Topic Comments OSC Response based on a list of security holders as at the record date.
Two commenters expressed concern that given the $15,000 individual investment limit, it is unlikely that the resulting issue will apply on a pro rata basis to all security holders.
17. Opposition to One commenter indicated that it is not necessary to We acknowledge this comment. differentiating between a differentiate between a security holder that bought security holder that securities in the secondary market one day before the bought securities in the announcement of the offering and a security holder that secondary market one bought the securities at a longer period before the day before the announcement of the offering because conceptually, announcement of the their positions are substantively identical. offering and a security holder that bought the securities some longer period before the announcement of the offering
18. Opposition to a limit on One commenter was of the view that it would be We acknowledge these comments. We are of the view that overall dilution duplicative and unnecessary for the OSC to adopt the overall dilution should not exceed 100%. We believe a requirements regarding maximum dilution for the dilution limit is appropriate as we do not think that offerings Existing Security Holder Prospectus Exemption, as both under the Exemption should result in significant dilution of the TSX and TSXV have rules and requirements in place security holder holdings. A 100% dilution limit is also that support the fair treatment of security holders and consistent with the proposed amendments to the rights support the quality of the Canadian market. No other offering prospectus exemption and will allow issuers to raise exemption under NI 45-106 imposes a 100% dilution a significant amount of capital. We do not believe that the limit on reporting issuers. dilution limit is overly restrictive as issuers are not limited to the number of times that they may use the Exemption in a 12 month period, except as constrained by an investor's investment limit, and may also use other prospectus exemptions.
Please also see response 14 above.
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No. Topic Comments OSC Response 19. Opposition to One commenter was concerned that the ability of an We acknowledge this comment. Please see response 14 requirement that any issuer to allocate undersubscribed portions of offerings above. securities that are not under the Existing Security Holder Prospectus Exemption taken up by existing at its discretion has the potential for abuse. This security holders can be commenter was of the view that existing security allocated at the issuer’s holders should rather be permitted to subscribe for discretion to other unsubscribed securities in proportion to their pro rata existing security holders share in order to minimize the risk of abuse of the Existing Security Holder Prospectus Exemption.
20. Opposition to no One commenter suggested implementing a five business We do not think it is necessary to implement a five business requirements on the day minimum period during which the offer should be day minimum period during which the offer should be made length of time the open in order to ensure a more meaningful offer is made open as part of the Existing Security Holder Prospectus offering can remain open to all existing security holders. Exemption. We note that this condition is not in the CSA Existing Security Holder Prospectus Exemption. A condition of the Exemption requires issuers to make the offer available to all security holders. If the issuer were to set a very short offering period, it may call into question whether an issuer met the requirement to make the offer available to all security holders.
Investor qualifications 21. Support for the One commenter was in favour of the requirement that We acknowledge this comment. requirement that each each investor must represent in writing to the issuer investor must represent that as of the record date the investor held, and in writing to the issuer continues to hold, the type of listed security that the that as of the record date investor is acquiring under the Existing Security Holder the investor held, and Prospectus Exemption. continues to hold, the type of listed security that the investor is acquiring under the Existing Security Holder Prospectus Exemption
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No. Topic Comments OSC Response 22. Concern with the One commenter suggested that further guidance should Each investor must represent in writing to the issuer that as language “continues to be provided as to why an investor must represent in at the record date the investor held, and continues to hold, hold” writing to the issuer that the investor “continues to the type of listed security that the investor is acquiring under hold” the type of security being acquired under the the Exemption. We are of the view that additional guidance Existing Security Holder Prospectus Exemption. is not necessary.
23. Concern with One commenter was of the view that the Existing We would treat, as improper, any effort to solicit investors to commentary that any Security Holder Prospectus Exemption should be purchase shares in the secondary market in order to rely on efforts by an issuer to clarified and should expressly state any prohibition that the Exemption. We are of the view that additional guidance solicit investors to the OSC wishes to impose on the use of the Exemption. is not necessary at this time. However, we will monitor the purchase shares in the The commenter was of the view that there is uncertainty use of the Exemption and will consider providing additional market in order to use as to the intent of the Proposed Amendments. guidance if needed. the Existing Security Holder Prospectus Exemption will be treated as “improper”
24. Support for record date Three commenters supported that the record date must We acknowledge these comments. being at least one day be at least one day prior to the day that an issuer issues prior to the day that an an offering news release for the following reasons: issuer issues an offering • the provision is consistent with the CSA Existing news release Security Holder Prospectus Exemption, • a longer requirement is too subjective and would exclude certain existing security holders for no substantive reason, and • an investor who is already a security holder of an issuer will be well positioned to make an informed decision about an additional investment in the issuer.
25. Opposition to the record Three commenters were of the view that the record We acknowledge these comments. In addition to being date being at least one date should be more than one day before the harmonized with the CSA Existing Security Holder Prospectus day prior to the day that announcement of the offering since it may not be Exemption, we are of the view that it is not necessary to an issuer issues an possible for the issuer to conduct sufficient due require that a security holder be a holder of the issuer’s offering news release diligence; and that if securities are held for only one day security on a date that is more than one day before the investors do not have advance notice. One commenter announcement of the offering. 18
No. Topic Comments OSC Response suggested that investors should hold securities of the issuer for a minimum of one calendar day so that the investor can experience the volatility of the security’s price on the exchange, the issuer’s track record of disclosure and shareholder communications.
One commenter recommended that the record date should be 30 days prior to the date of the announcement to prevent potential abuse by market participants, particularly by persons close to the issuer who may have access to information about the proposed offering. One commenter indicated that advance notice be provided as of the record date similar to what is required for a dividend issuance (e.g. 7 days).
Investment limits 26. Support for investment One commenter supported the investment limit of We acknowledge this comment. limits of $15,000 in the $15,000 in the previous 12 months unless the purchaser previous 12 months for has obtained advice regarding the suitability of the individuals who have not investment, and if the purchaser is a resident of a obtained advice jurisdiction of Canada, that advice is from a person regarding the suitability registered in the jurisdiction as an investment dealer. of the investment The commenter was of the view that the annual limit and the requirement for suitability advice provide investor protection.
27. Opposition to investment Five commenters did not support the investment limit of We acknowledge these comments. In addition to being limits for individuals who $15,000 in the previous 12 months unless the purchaser harmonized with the CSA Existing Security Holder Prospectus have not obtained advice has obtained advice regarding the suitability of the Exemption, we are of the view that an investment limit of regarding the suitability investment, and if the purchaser is a resident of a $15,000 for individuals who have not obtained advice of the investment jurisdiction of Canada, that advice is from a person regarding suitability is an important investor protection registered in the jurisdiction as an investment dealer for measure. We believe that investment limits serve two the following reasons: important functions by: • $15,000 limit is arbitrary and may make the 1. mitigating the risk of loss for the investor, and Exemption unattractive to issuers listed on senior 2. encouraging asset class diversification. markets, Furthermore, an investor’s option to obtain suitability advice 19
No. Topic Comments OSC Response
• suitability advice may be impractical and/or time in order to exceed the investment limit provides flexibility to consuming to obtain, investors for whom it may be appropriate to exceed the limit. • investors are not otherwise limited to invest any We note that the suitability obligation is considered a particular amount on the secondary market, fundamental investor protection for all investors, including • suitability should not be an issue for existing accredited investors. security holders given that they already hold securities of the issuer, Consistent with the CSA Existing Security Holder Prospectus • given that an offering is permitted to result in an Exemption, the Exemption contemplates advice from an increase of 100% of the outstanding securities of investment dealer. the class, investments should be limited to an investor’s pro rata ownership of securities of the issuer so as to permit the investor to maintain its pro rata position in an issuer, • the requirement for pro rata, in combination with the $15,000 investment limit in the absence of suitability advice, may not support the fair treatment of all security holders, since security holders holding greater than $15,000 worth of securities prior to the time of the financing will be at a disadvantage compared to security holders holding less than that amount when it comes to retaining pro rata position in the issuer, and • accredited investors are not otherwise subject to any limits on the amount they can invest.
In the alternative, one commenter suggested that the requirement should be broadened to permit advice, not only from investment dealers, but from exempt market dealers and appropriate categories of restricted dealers in Canada.
Point of sale disclosure 28. Support for requirement Two commenters stated that the offering news release We acknowledge these comments. We are of the view that to issue an offering news should have additional disclosure requirements. the disclosure requirements will inform investors of the release disclosing the Specifically, the offering news release should disclose: material terms of the offering in a simple and transparent proposed offering that • the holdings of insiders and whether the insiders manner. The offering news release sets out the core includes reasonable intend to subscribe for the offering in full or in part, elements of the offering which we think the investor requires 20
No. Topic Comments OSC Response
detail of proposed • a warning to investors that an increase in their in order to make an informed investment decision and it is distribution and security holdings results in increasing their exposure incumbent upon the issuer to provide additional information proposed use of proceeds to high risk investments and they should consider that the investor requires to make an informed investment whether, in light of their portfolio of holdings, it is decision. The Exemption requires an issuer to represent that appropriate or not to do so, there is no material fact or material change related to the • the most current information, and issuer which has not been generally disclosed. Moreover, • that such investments are speculative, high risk and additional disclosure is available in the material change the investors should consider whether purchasing report that will have to be filed in connection with an additional holdings in the issuer would be offering. appropriate for them, given their portfolio of investments (as some investors will have purchased the securities through a discount brokerage rather than through an investment dealer with “know- your-product” and “know-your-client” obligations).
Investor rights 29. Opposition to Secondary One commenter stated that Contractual Liability is We acknowledge this comment. Market Disclosure preferable to prescribing the Existing Security Holder Liability Prospectus Exemption under section 138.2(b) of the Act. We believe that there are a number of advantages for While Contractual Liability is available only against the prescribing Secondary Market Disclosure Liability rather than issuer, the commenter stated that it is preferable to the Contractual Liability, including: rights of action under Part XXIII.1 of the Act which sets • Under the Secondary Market Disclosure Liability regime, out the Secondary Market Disclosure Liability regime investors have rights of action for damages that are not because under a Contractual Liability regime: available under Contractual Liability, namely, in relation • there is a rescission remedy, to misrepresentations in public oral statements and • there is no requirement to obtain leave of a court to failure of an issuer to make timely disclosure; enforce the right of action, • Rights under the Secondary Market Disclosure Liability • the issuer’s liability is not subject to a liability limit regime are enforceable against a broader group of (damages cap), and persons including directors, officers, control persons and • the only defence available to the issuer is that the experts than Contractual Liability, which only applies purchaser had knowledge of the misrepresentation. against the issuer; and • Under a Contractual Liability regime, there is a potential The commenter was of the view that consideration must risk that an issuer would not set out the prescribed be given to how the contractual and statutory remedies provisions in a subscription agreement. There is also a will interact because the characteristics of the rights of risk that provisions in a subscription agreement will not action are markedly different (in contrast to, for be consistent from issuer to issuer or from offering to example, the statutory and contractual remedies for offering. 21
No. Topic Comments OSC Response misrepresentation in an offering memorandum). Given the board range of what may be a “core Further, no disclosure document is being prescribed; reliance document” or a “document”, the requirement would is being placed on the continuous disclosure regime. import exposure similar to that under the Secondary Accordingly, it is appropriate to prescribe that Secondary Market Disclosure Liability regime into the Existing Market Disclosure Liability applies. Security Holder Prospectus Exemption without the same procedural safeguards. Please also see response 3 above.
Resale restrictions 30. Support for securities of a Seven commenters believed that a four-month hold We acknowledge these comments. reporting issuer being period should apply to the securities distributed under subject to a four-month the Existing Security Holder Prospectus Exemption for hold period the following reasons: • it would be helpful to ensure that investors are purchasing as principal, • investors who are existing shareholders would be free to trade their existing securities of the issuer held on the record date during the four-month hold period for the newly issued securities, and • a four-month hold period would help discourage retail investors from using the Existing Security Holder Prospectus Exemption for speculation purposes, particularly with respect to securities of more junior issuers.
The majority of these commenters were of the view that this provision should be consistent with the CSA Existing Security Holder Prospectus Exemption and with all other prospectus exemptions.
31. Opposition to securities Two commenters stated that securities distributed We are of the view that it is appropriate to take an approach of a reporting issuer under the Exemption should be freely tradable because that is consistent with the resale restrictions for other capital being subject to a four- removing the four-month hold period will reduce the raising exemptions such as the accredited investor month hold period discount that issuers must offer and ultimately reduce exemption. Additionally, the CSA Existing Security Holder dilution to security holders who do not participate while Prospectus Exemption also has resale restrictions. reducing the cost of the capital of the issuer. 22
No. Topic Comments OSC Response
One commenter noted that the existing level of investor protection for any securities distributed under the Exemption is sufficient to allow them to be freely tradable among retail investors. Secondly, in the interests of capital raising, the securities distributed under the Exemption should be able to replicate or mirror as closely as possible the original securities from which they are, in essence, derived. Lastly, the issue of harmonization is always a concern, so the regulator should consider the need to maintain consistency with how freely the newly purchased securities would be allowed to be traded in other jurisdictions.
Reporting of distribution 32. Support for requirement One commenter supported requiring a report of exempt We acknowledge this comment. We note that we have made to file report of exempt distribution when a distribution is made relying on the drafting changes to OSC Rule 45-501 and 45-501CP to distribution on Form 45- Existing Security Holder Prospectus Exemption so as to address the requirement that a Form 45-106F1 Report of 106F11 gather information on the use of the Exemption and to Exempt Distribution must be used to report any distributions monitor compliance with it. under the Existing Security Holder Prospectus Exemption.
APPENDIX C AMENDMENTS TO OSC RULE 45-501 ONTARIO PROSPECTUS AND REGISTRATION EXEMPTIONS AND CHANGES TO COMPANION POLICY 45-501CP TO OSC RULE 45-501 ONTARIO PROSPECTUS AND REGISTRATION EXEMPTIONS
Attached to this appendix are:
Annex C-1 Amending instrument for OSC Rule 45-501 Ontario Prospectus and Registration Exemptions
Annex C-2 Changes to Companion Policy 45-501CP to OSC Rule 45-501 Ontario Prospectus and Registration Exemptions
Annex C-3 Amending instrument for National Instrument 45-102 Resale Of Securities
24
ANNEX C-1
EXISTING SECURITY HOLDER PROSPECTUS EXEMPTION
AMENDING INSTRUMENT FOR OSC RULE 45-501 ONTARIO PROSPECTUS AND REGISTRATION EXEMPTIONS
1. OSC Rule 45-501 Ontario Prospectus and Registration Exemptions is amended by this Instrument.
2. The Rule is amended by adding the following section:
2.9 Distributions to existing security holders
(1) In this section,
“announcement date” means the day that an issuer issues an offering news release;
“investment dealer” has the same meaning as in section 1.1 of National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations;
“listed security” means an equity security of an issuer of a class listed on the Toronto Stock Exchange, the TSX Venture Exchange, the Canadian Securities Exchange or the Aequitas NEO Exchange;
“offering material” means a document purporting to describe the business and affairs of an issuer that has been prepared primarily for delivery to and review by a prospective purchaser so as to assist the prospective purchaser to make an investment decision in respect of securities being sold in a distribution under this section;
“offering news release” means a news release of an issuer announcing its intention to conduct a distribution under this section;
“record date” means the date determined by an issuer that intends to conduct a distribution under this section that is at least one day prior to the announcement date;
“warrant” means a warrant of an issuer that entitles the holder to acquire a listed security or a fraction of a listed security of the same issuer;
“unit” means a listed security and a warrant.
(2) The prospectus requirement does not apply to a distribution by an issuer of a listed security or a unit of its own issue to a security holder of the issuer purchasing as principal if all of the following apply:
(a) the issuer
(i) is a reporting issuer in at least one jurisdiction of Canada with a class of listed securities, and 25
(ii) is not an investment fund;
(b) the issuer has filed in each jurisdiction of Canada in which it is a reporting issuer all periodic and timely disclosure documents that it is required to have filed in that jurisdiction as and when required
(i) under applicable securities legislation,
(ii) pursuant to an order issued by the regulator or securities regulatory authority, or
(iii) pursuant to an undertaking to the regulator or securities regulatory authority;
(c) the issuer has issued and filed an offering news release describing in reasonable detail the proposed distribution, including, without limitation,
(i) the minimum and maximum number of securities proposed to be distributed under this section and the minimum and maximum aggregate gross proceeds of the distribution,
(ii) the proposed principal uses, including estimated dollar amounts, of the gross proceeds of the distribution, assuming both the minimum and maximum offering, and
(iii) a description of how the issuer intends to allocate securities;
(d) subject to applicable securities laws, the issuer permits each person who, as of the record date, held a listed security of the issuer of the same class and series as the listed securities to be distributed under this section to subscribe for securities in the distribution;
(e) the purchaser has represented in writing to the issuer that the purchaser held at the record date, and continues to hold, a listed security of the issuer of the same class and series as the listed securities to be distributed under this section;
(f) the issuer or any salesperson acting on behalf of the issuer in connection with a distribution under this section does not reasonably believe that the representation of the purchaser, referred to in paragraph (e), is untrue;
(g) either:
(i) the purchaser has obtained advice regarding the suitability of the investment and, if the purchaser is a resident of a jurisdiction of Canada, that advice is from a person registered in that jurisdiction as an investment dealer, or
(ii) the aggregate of the acquisition cost to the purchaser of securities to be purchased from the issuer under the distribution, when added to the acquisition cost to the purchaser of all other securities of the issuer acquired in reliance on this section in the 12-month period immediately preceding the distribution, does not exceed $15,000.
(3) The issuer must represent to the purchaser in the subscription agreement that
(a) the issuer's “core documents” and “documents”, as those terms are defined in section 138.1 of the Act, do not contain a misrepresentation, and
(b) there is no material fact or material change related to the issuer which has not been generally disclosed. 26
(4) A distribution of listed securities or units by an issuer under subsection (2) must not result in an increase of more than 100 percent in the number of outstanding listed securities of the same class.
(5) The exemption in subsection (2) is not available for a distribution of a listed security if the class of listed security has been suspended from trading for failure to comply with the ongoing requirements of the applicable exchange.
(6) Part XXIII.1 of the Act applies to a security distributed under this section.
(7) Other than the subscription agreement, any offering material prepared in connection with a distribution under this section must be filed with the securities regulatory authority by the issuer no later than the day that the offering material was first provided to a potential purchaser.
3. Section 6.1 is deleted and replaced with the following:
6.1 Report of exempt distribution – (1) An issuer that distributes its own securities must file a report if it makes the distribution under
(a) section 2.1 [Government incentive security], or
(b) section 2.9 [Distributions to existing security holders].
(2) The issuer must file the report no later than 10 days after the distribution..
4. Section 6.2 is deleted and replaced with the following:
6.2 Required form of report of exempt distribution – (1) The required form of report under paragraph 6.1(1)(a) [Report of exempt distribution] is Form 45-501F1.
(2) The required form of report of exempt distribution under paragraph 6.1(1)(b) [Report of exempt distribution] is Form 45-106F1 Report of Exempt Distribution..
5. This instrument comes into force on February 11, 2015. 27
ANNEX C-2
EXISTING SECURITY HOLDER PROSPECTUS EXEMPTION
CHANGES TO COMPANION POLICY 45-501CP TO OSC RULE 45-501 ONTARIO PROSPECTUS AND REGISTRATION EXEMPTIONS
1. The changes to Companion Policy 45-501CP to OSC Rule 45-501 Ontario Prospectus and Registration Exemptions are set out in this Annex.
2. Section 6.1 is deleted and replaced with the following:
6.1 Report of exempt distribution – (1) Section 6.1 of the Rule requires an issuer that has distributed a security of its own issue under section 2.1 [Government incentive security] or section 2.9 [Distributions to existing security holders] of the Rule to file a report of exempt distribution in the required form, on or before the 10th day after the distribution..
3. The following is added after Part 7:
PART 8: EXISTING SECURITY HOLDER PROSPECTUS EXEMPTION
Distributions to existing security holders
8.1 General – All security holders of the same class of securities must be treated fairly and in a manner that is perceived to be fair in connection with a distribution under section 2.9 of the Rule. The Commission recognizes that distributions to existing security holders are capable of being abusive or unfair. Accordingly, issuers and others who benefit from access to the capital markets have an obligation to treat security holders fairly, and the fulfillment of this obligation is essential to the protection of the public interest in maintaining capital markets that operate efficiently, fairly and with integrity.
8.2 Anti-dilution – While an offer must be made available to all persons who, as of the record date, held a listed security of the issuer of the same class and series as the listed security to be distributed under section 2.9 of the Rule, there is no requirement that an issuer make the offer on a pro rata basis to its security holders. For the purposes of a distribution under section 2.9 of the Rule, if security holders have an identical opportunity under the distribution, then they are considered to be treated identically.
While there is no pro rata requirement, the Commission takes the position that in order to support the fair treatment of all security holders, an issuer should establish, maintain and apply policies and procedures that provide reasonable assurance that the issuer, and, if applicable, each registrant, fairly allocate investment opportunities among the issuer’s security holders. However, any distribution under section 2.9 of the Rule cannot result in an increase of more than 100% of the outstanding securities of the same class and section 2.9 of the Rule should not be used in a manner that results in security holders suffering significant dilution.
8.3 Minimum Subscription Amount – Under section 2.9 of the Rule, there is no requirement that an issuer accept all subscriptions from each existing security holder. However, if an issuer were to reject a subscription that was in all respects a valid subscription, it could call into question whether the offering was made available to all security holders of the issuer. While an issuer might not want to accept small subscription amounts because of the administrative burden, for transparency purposes, an issuer should consider clearly disclosing the minimum subscription amount in the offering news release.. 28
ANNEX C-3
EXISTING SECURITY HOLDER PROSPECTUS EXEMPTION
AMENDING INSTRUMENT FOR NATIONAL INSTRUMENT 45-102 RESALE OF SECURITIES
1. National Instrument 45-102 Resale of Securities is amended by this Instrument.
2. APPENDIX D is amended by:
(a) Replacing the definition of “2009 OSC Rule 45-501” with the following:
““2009 OSC Rule 45-501” means the Ontario Securities Commission Rule 45-501 Ontario Prospectus and Registration Exemption that came into force on the later of (a) September 28, 2009 and (b) the day on which sections 5 and 11, subsection 12(1) and section 13 of Schedule 26 of the Budget Measures Act, 2009, were proclaimed into force, as amended on February 11, 2015;”,
(b) by replacing “Section 2.2 of the 2005 OSC Rule 45-501 and 2009 OSC Rule 45-501.” in paragraph 3(b) with the following:
“Section 2.2 of the 2005 OSC Rule 45-501 and 2009 OSC Rule 45-501;
Section 2.9 of the 2009 OSC Rule 45-501.”.
Chapter 6
Request for Comments
6.1.1 Proposed NI 24-102 Clearing Agency Requirements and Related Companion Policy 24-102CP
Notice and Request for Comment on Proposed National Instrument 24-102 Clearing Agency Requirements and Related Companion Policy 24-102CP
November 27, 2014
I. Introduction
The Canadian Securities Administrators (the CSA or we) are publishing the following documents for a 75 day comment period:
• Proposed National Instrument 24-102 – Clearing Agency Requirements (Instrument), and
• Proposed Companion Policy 24-102CP – to National Instrument 24-102 – Clearing Agency Requirements (Companion Policy).
The comment period will end on February 10, 2015. The Instrument and Companion Policy are revised versions of the Local Rules and Local CPs published last year in the provinces of Québec, Manitoba and Ontario described below under “II. Background”.
The texts of the Instrument (together with Forms 24-102F1 and F2) and Companion Policy are contained in Appendix “C” of this Notice and are also available on websites of CSA jurisdictions, including: www.lautorite.qc.ca www.albertasecurities.com www.bcsc.bc.ca www.gov.ns.ca/nssc www.fcnb.ca www.osc.gov.on.ca www.fcaa.gov.sk.ca www.msc.gov.mb.ca
II. Background
On December 18, 2013, the Autorité des marchés financiers (AMF), Manitoba Securities Commission (MSC) and Ontario Securities Commission (OSC) each published for comment the following documents, in substantially similar form, in their respective jurisdictions:
• a proposed local rule 24-503 regarding clearing agency requirements (Local Rule);1
• a related proposed local companion policy 24-503CP (Local CP); and
• a notice and request for comments on the proposed Local Rule and Local CP (Local Request Notice).
1 The proposed Local Rules that were published for comment are the following: AMF Regulation 24-503 Respecting Clearing House, Central Securities Depository and Settlement System Requirements; MSC Rule 24-503 Clearing Agency Requirements; and OSC Rule 24-503 Clearing Agency Requirements(see Notice and Request for Comment on Proposed OSC Rule 24-503 Clearing Agency Requirements and Related Companion Policy, December 19, 2013 (2013), 36 OSCB 12209).
November 27, 2014 (2014), 37 OSCB 10483
Request for Comments
In addition, concurrent to the publication of the Local Request Notices and proposed Local Rules and CPs, provincial securities regulatory authorities in Alberta, British Columbia, New Brunswick, Nova Scotia and Saskatchewan published Multilateral Staff Notice 24-309 (the Multilateral Notice).2 The purpose of the Multilateral Notice was to inform the public that such authorities had also begun the development of, and intended to publish at a later date, a proposed multilateral instrument and companion policy (Multilateral Instrument and CP) substantially similar to the Local Rules and CPs.
The Local Rules and CPs had several purposes. They had set out certain requirements in connection with the application process for recognition as a clearing agency under securities legislation, or for an application to be exempt from the recognition requirement. The Local CPs contained guidance on the regulatory approaches to applications for recognition or exemption. The Local Rules had also set forth on-going requirements for recognized clearing agencies that operate as a central counterparty (CCP), central securities depository (CSD) or securities settlement system (SSS). These requirements were based largely on international standards applicable to financial market infrastructures (FMIs) described in the April 2012 report Principles for financial market infrastructures (as the context requires, the “PFMIs” or “PFMI report”) published by the Committee on Payments and Market Infrastructures (CPMI)3 and the International Organization of Securities Commissions (IOSCO).4 A key objective of the proposed Local Rules and CPs was to adopt, in Canada, the CPMI-IOSCO international standards governing FMIs set out in the PFMI report. Implementation of the standards was intended to enhance the safety and efficiency of FMIs, limit systemic risk, and foster financial stability. It was also intended to complement the work of the CSA Derivatives Committee to develop a comprehensive regulatory framework for the trading and clearing of derivatives in Canada.
We received nine comment letters and published a summary of the comments in CSA Notice 24-310 on July 17, 2014 (Notice 24-310).5 As discussed in Notice 24-310, stakeholders requested that provincial securities regulators take a unified approach to implementing the PFMIs. As a result, the CSA have developed the Instrument and Companion Policy to achieve essentially the same objectives as the Local Rules and CPs and Multilateral Instrument and CP. We have provided general responses to the comments summarized in Notice 24-310 in Appendix “A” to this Notice.
III. Substance and Purpose of Instrument and Companion Policy
As with the Local Rules and CPs, the main purpose of the Instrument and Companion Policy is to implement the PFMIs as clearing agency rule requirements in Canada. Part 3 of the Instrument generally incorporates the text of the PFMI report’s relevant principles and their key considerations. Part 4 of the Instrument separately sets out certain other requirements that are in addition to the PFMIs. The Companion Policy largely contains supplementary guidance (Joint Supplementary Guidance) jointly developed by the CSA and the Bank of Canada in interpreting and applying the PFMIs.
Overall, the Instrument and Companion Policy are intended to enhance the regulatory framework for recognized clearing agencies operating or seeking to operate in a Canadian jurisdiction. As discussed more fully below under “VIII. Anticipated Costs and Benefits”, this regulatory framework will facilitate ongoing observance by a recognized clearing agency of international minimum standards applicable to FMIs. The CSA believe that the Instrument will support resilient and cost-effective clearing agency operations.
We discuss key elements of the Instrument and Companion Policy below under “IV. Summary of Instrument and Companion Policy and Ongoing Policy Matters”. We also discuss certain ongoing policy matters that may need to be clarified in the Instrument or Companion Policy. We are seeking comment on any aspect of the Instrument and Companion Policy and the ongoing policy matters. Please see below under “X. Comment Process” for information on how to provide comments.
IV. Summary of Instrument and Companion Policy and Ongoing Policy Matters
The Instrument is divided into seven parts.
(a) Part 1 – Definitions, Interpretation and Application
We have removed certain defined terms in the Local Rules from Part 1 of the Instrument. We believe that terms defined in the Local Rules that were derived almost verbatim from the PFMI report’s glossary of terms do not need to be defined in the Instrument. As noted in the Companion Policy, regard should be had to the PFMI report in interpreting and applying the Instrument. This includes how the PFMI report defines or describes the specialized terminology it uses, which are also used in the Instrument.
2 The Multilateral Notice can be found on certain websites of such authorities. For example, see on the Website of the British Columbia Securities Commission (BCSC) at: https://www.bcsc.bc.ca/Securities_Law/Policies/Policy2/24-309_Publication_of_Clearing_Agency_ Requirements_in_Ontario__Quebec_and_Manitoba__CSA_Multilateral_Staff_Notice_/ 3 Prior to September, 2014, CPMI was known as the Committee on Payment and Settlement Systems (CPSS). 4 The PFMI report is available on the Bank for International Settlements’ website (www.bis.org) and the IOSCO website (www.iosco.org). 5 See CSA Staff Notice 24-310 Status Update on Proposed Local Rules 24-503 Clearing Agency Requirements and Related Companion Policies, July 17, 2014, (2014), 37 OSCB 6677.
November 27, 2014 (2014), 37 OSCB 10484
Request for Comments
Part 1 of the Instrument contains additional interpretive provisions, such as the typical meanings of affiliated entity, controlled entity and subsidiary entity that are based on the notion of de jure control of an entity. Consistent with the PFMIs,6 there is also an extended de facto-control meaning of “affiliate” for limited purposes. These provisions will ensure that the terms are interpreted uniformly in all CSA jurisdictions.
We have included additional provisions in Part 1 of the Instrument that clarify the scope of various parts of the Instrument. For example, Part 3 of the Instrument applies to a recognized clearing agency that operates as a CCP, CSD or SSS, while Part 4 of the Instrument generally applies to a recognized clearing agency whether or not it operates as a CCP, CSD or SSS.
Subsection 1.4(2) of the Local Rules has been removed in the Instrument. The intent of the provision was to address any potential conflict or inconsistency between Part 3 of the Local Rules and a provision of proposed Model Provincial Rule on Derivatives: Customer Clearing and Protection of Customer Collateral and Positions published for comment on January 16, 2014 in CSA Staff Notice 91-304 (Model Rule 91-304). At this time, we do not believe that such a conflict provision will be necessary. The CSA Derivatives Committee is currently revising proposed Model Rule 91-304 (Revised Model Rule 91-304), which is expected to be republished for comment subsequent to the date of this Notice. Revised Model Rule 91-304 will include requirements on clearing agencies operating as a CCP for the clearing and settlement of trades in over-the-counter (OTC) derivatives, including requirements governing a CCP’s segregation and portability arrangements to protect customer positions and associated collateral in the event of a participant’s failure. See the discussion below under “(c) Part 3 – International Standards Applicable to Recognized Clearing Agencies – (iii) Segregation and portability”.
(b) Part 2 – Clearing Agency Recognition and Exemption from Recognition
Part 2 of the Instrument is mostly unchanged from the Local Rules. We have modified some of the requirements governing the filing of financial statements by clearing agencies, including allowing statements that are prepared in accordance with the generally accepted accounting principles of the foreign jurisdiction in which the clearing agency is incorporated, organized or located.
(c) Part 3 – International Standards Applicable to Recognized Clearing Agencies
(i) Implementation of the PFMIs as rule requirements
We have significantly modified Part 3 of the Local Rules, by dividing it into two parts in the Instrument:
• Part 3 – International Standards Applicable to Recognized Clearing Agencies, and
• Part 4 – Other Requirements of Recognized Clearing Agencies.
Part 3 of the Instrument incorporates by way of an appendix to the Instrument (Appendix A to the Instrument) clearing agency standards (Standards) that are substantially similar to the PFMI report’s 23 principles (Principles) and their respective key considerations (Key Considerations) that are relevant to CCPs, SSSs and CSDs. Specifically, section 3.1 of the Instrument requires recognized clearing agencies to establish, implement and maintain rules, procedures, policies or operations designed to ensure that they meet or exceed the Standards in Appendix A to the Instrument with respect to their clearing, settlement and depository activities. Requiring clearing agencies to implement rules, procedures, policies or operations to meet or exceed the Standards is consistent with a flexible and principles-based approach to regulation. Among other reasons, a principles-based approach anticipates that a clearing agency’s rules, procedures, policies and operations will need to evolve over time so that it can adequately respond to changes in technology, legal requirements, the needs of its participants and their customers, trading volumes, trading practices, linkages between financial markets, and the financial instruments traded in the markets that a clearing agency serves.
The Standards in Appendix A to the Instrument generally reproduce the text of the 23 Principles and their respective Key Considerations. Differences between the text of the Standards and the Principles and Key Considerations are minimal. We include in Appendix “B” of this Notice a black-lined version of the Standards that reflects the changes that we have made to the text of the Principles and Key Considerations in drafting the Standards. We also discuss below the following Standards (including ongoing policy matters):
• a clearing agency’s recovery or orderly wind-down plans (see section 3.4 of Standard 3: Framework for the comprehensive management of risks and section 15.3 of Standard 15: General business risk);
• a clearing agency’s segregation and portability arrangements for customer positions and collateral (see Standard 14: Segregation and portability);
6 See footnote 39 of the PFMI report, at p. 38.
November 27, 2014 (2014), 37 OSCB 10485
Request for Comments
• the resumption of operations of a clearing agency’s critical information technology systems within two hours following disruptive events (see section 17.6 of Standard 17: Operational risks); and
• tiered participation arrangements in using a clearing agency’s services (see Standard 19: Tiered participation arrangements).
(ii) Recovery or orderly wind-down plans
Section 3.4 of Standard 3: Framework for the comprehensive management of risks requires a clearing agency to identify scenarios that may potentially prevent it from being able to provide its critical operations and services as a going concern, and assess the effectiveness of a full range of options for recovery or orderly wind-down. It also notes that the clearing agency should prepare appropriate plans for its recovery or orderly wind-down based on the results of that assessment. Moreover, where applicable, the clearing agency is expected to provide relevant authorities with the information needed for purposes of resolution planning. Section 15.3 of Standard 15: General business risk requires a clearing agency, among other things, to maintain a viable recovery or orderly wind-down plan and hold sufficient liquid net assets funded by equity to implement the plan.
The CSA, together with the Bank of Canada, have decided to defer the implementation of these Standards because additional guidance on these Standards has only recently been published by the CPMI and IOSCO,7 and we have not yet completed proposed Joint Supplementary Guidance on such Standards. We will be expecting clearing agencies to develop recovery plans in two stages, due to the complexity of recovery planning and the need to assess what recovery tools are appropriate for Canadian FMIs. Canadian authorities will expect a clearing agency’s first-generation recovery plan to identify critical services, recovery triggers, stress scenarios, structural weaknesses and processes for orderly wind-down. Second-generation plans, due from clearing agencies by the end of 2016, should additionally specify the concrete recovery tools the clearing agency plans to deploy in specific recovery scenarios. We will update stakeholders on proposed transitional dates for implementing the various stages of these Standards in 2015.
(iii) Segregation and portability
Standard 14: Segregation and portability requires a CCP to have rules and procedures that enable the segregation and portability8 of positions and related collateral of a CCP participant’s customers, particularly to protect the customers from the default or insolvency of the participant. Standard 14 mirrors Principle 14 and its Key Considerations in the PFMI report.
The CSA and Bank of Canada are continuing to assess certain policy considerations in implementing Standard 14 for our domestic CCPs serving cash and exchange-traded derivatives markets.9 Currently, the vast majority of participants in such CCPs, who clear for customers, are investment dealers and members of the Investment Industry Regulatory Organization of Canada (IIROC).10 IIROC dealer-members holding client assets are required to contribute to the Canadian Investor Protection Fund (CIPF), an investor compensation protection fund that is sponsored by IIROC and approved by the CSA. We are having ongoing discussions with stakeholders, particularly domestic CCPs, IIROC and CIPF, to determine the scope of implementing Standard 14 for domestic CCPs serving exchange-traded derivatives markets. As a result, we have decided, together with the Bank of Canada, to defer the implementation of this Standard. The CSA will update stakeholders on a proposed transitional period for implementing Standard 14 in 2015. We discuss some of the ongoing policy matters below.
(A) Alternate approach for CCPs serving cash markets
As discussed in the Local Request Notices, the explanatory notes in the PFMI report offer an “alternate approach” to meeting Principle 14. The report notes that, in certain jurisdictions, cash market CCPs operate in legal regimes that facilitate segregation and portability to achieve protection of customer assets by alternate means that offer the same degree of protection as the approach in Principle 14.11 We highlighted the features of the alternate approach in the Local Request Notices,12 and sought
7 See the CPMI-IOSCO’s October 2014 report Recovery of financial market infrastructures, which is available on the Bank for International Settlements’ website (www.bis.org) and the IOSCO website (www.iosco.org). 8 Portability refers to the operational aspects of the transfer of contractual positions, funds, or securities from one party to another party. See paragraph 3.14.3 of the PFMI report. 9 As discussed above, the CSA Derivatives Committee is separately developing a regulatory framework that will implement Principle 14 for CCPs serving the OTC derivatives markets. 10 Investment dealers are firms registered in the category of “investment dealer” under provincial securities legislation. Investment dealers are required to be members of IIROC. See section 9.1 of National Instrument 31-103 Registration Requirements, Exemptions and Ongoing Registrant Obligations. 11 See paragraph 3.14.6 of the PFMI report, at p. 83. 12 Features of such legal regimes are that, if a participant fails, (a) the customer positions can be identified in a timely manner, (b) customers will be protected by an investor protection scheme designed to move customer accounts from the failed or failing participant to another participant in a timely manner, and (c) customer assets can be restored. As an example, the PFMIs suggest that domestic law may subject participants to explicit and comprehensive financial responsibility and customer protection requirements that obligate participants to make
November 27, 2014 (2014), 37 OSCB 10486
Request for Comments feedback on how to apply Principle 14 and the alternate approach. We stated that, particularly for certain cash market CCPs, such as the continuous net settlement (CNS) service offered by CDS Clearing and Depository Services Inc. (CDS), once netting and novation have been completed, the CCP is unable to track customer positions directly. To do otherwise would require fundamental changes to the operations, and potentially the effectiveness of, these CCPs, as well as impact the market structure more broadly. We said that imposing a prescriptive CCP-level segregation and portability model on cash-market CCPs may have, in certain circumstances, unintended consequences for existing customer protection frameworks. Many stakeholders agreed with this view, noting in particular that the customer asset protection regime applicable to investment dealers (IIROC- CIPF regime) is an appropriate alternative framework for customers of investment dealers who are direct participants of a cash- market CCP.
We believe that the IIROC-CIPF regime meets the criteria for the alternate approach for CCPs serving certain domestic cash markets, such as CDS’ CNS service, because:
• IIROC’s requirements governing, among other things, an investment dealer’s books and records, capital adequacy, internal controls, client account margining, and segregation of client securities and cash help ensure that customer positions and collateral can be identified timely,
• customers of an investment dealer are protected by CIPF, and
• through a combination of IIROC’s member rules and oversight powers, CIPF’s role in the administration of the bankruptcy of a dealer, and the overarching policy objectives of Part XII of the federal Bankruptcy and Insolvency Act (BIA) (discussed below), customer accounts can be moved from a failing dealer to another dealer in a timely manner and customers’ assets can be restored.
Part XII of the BIA sets out a special bankruptcy regime for administering the insolvency of a securities firm. The regime generally provides for all cash and securities of a bankrupt securities firm, whether held for its own account and for its customers, to vest in the appointed trustee in bankruptcy. The trustee, in turn, is directed to pool such assets into a “customer pool fund” for the benefit of the customers, which are entitled to a pro rata share of the customer pool fund according to their respective “net equity” claims as a priority claim before the general creditors are paid. To the extent there is a shortfall in customer recovery from the customer pool fund and any remaining assets in the insolvent estate, the assets are allocated among the customers on a pro rata basis. CIPF, which works in conjunction with IIROC and the bankruptcy trustee,13 provides protection to eligible customers for losses up to $1 million per account.14
We have not added any provision in the Instrument or Companion Policy to explicitly govern the use of the alternate approach for CCPs serving cash markets to meet the requirements of Standard 14. The CSA are considering the need for an explicit rule provision in the Instrument, or for special guidance in the Companion Policy, to accommodate and govern the availability of the alternate approach in the cash markets. We agree with commenters’ views that a rule provision or special guidance should not be framed as an exemption to the requirements of Standard 14. This is because the PFMIs acknowledge that the outcomes of the Principles can generally be achieved using different means.15 Moreover, the Companion Policy expressly states that regard is to be given to the explanatory notes in the PFMI report, as appropriate, in interpreting and implementing the Standards. This would include paragraph 3.14.6 of the PFMI report, which describes the alternate approach for CCPs serving certain cash markets as a means to meet Principle 14.
(B) Standard 14 for domestic CCPs serving futures and other exchange-traded derivatives markets – Policy considerations
The PFMI report does not contemplate the availability of the alternate approach in respect of CCPs serving non-cash markets, such as futures and other exchange-traded markets. CSA regulators are considering the need to require enhanced CCP-level segregation and portability frameworks for customer positions and collateral held in omnibus customer account structures in
frequent determinations (for example, daily) that they maintain possession and control of all customers’ fully paid and excess margin securities and to segregate their proprietary activities from those of their customers. Under these types of regimes, pending securities purchases do not belong to the customer; thus there is no customer trade or position entered into the CCP. As a result, participants who provide collateral to the CCP do not identify whether the collateral is provided on behalf of their customers regardless of whether they are acting on a principal or agent basis, and the CCP is not able to identify positions or the assets of its participants’ customers. 13 CIPF is a “customer compensation body” for the purposes of Part XII of the BIA. Where the accounts of a securities firm are protected (in whole or in part) by CIPF, the trustee in bankruptcy is required to consult with CIPF on the administration of the bankruptcy, and CIPF may designate an inspector to act on its behalf. See section 264 of the BIA. 14 The losses must be in respect of a claim for the failure of the dealer to return or account for securities, cash balances, commodities, futures contracts, segregated insurance funds or other property received, acquired or held by the dealer in an account for the customer. 15 See paragraph 1.19 of the PFMI report, at p. 12.
November 27, 2014 (2014), 37 OSCB 10487
Request for Comments such markets, such as requiring the CCP to collect customer margin on a gross basis.16 According to the PFMI report, gross margining enhances the feasibility of portability for the CCP.17 A number of commenters on the Local Rules and CPs raised concerns about the application of Principle 14 on CCPs serving the futures markets.
CSA regulators are continuing to review the implications of requiring enhanced CCP-level customer segregation and portability rules and procedures for CCPs serving the exchange-traded derivatives markets, particularly on CCPs, investment dealers, the IIROC-CIPF regime, and the pro rata distribution scheme of Part XII of the BIA.18
(C) Standard 14 for CCPs serving the OTC derivatives markets
As we note above under “(a) Part 1 – Definitions, Interpretation and Application”, the CSA Derivatives Committee is separately developing a regulatory framework that will implement Principle 14 for CCPs serving the OTC derivatives markets. Proposed Revised Model Rule 91-304 is expected to require such CCPs to have detailed segregation and portability rules and arrangements that are more stringent than the Key Considerations of Principle 14.
(iv) Resumption of operations within two hours of disruptive events
Section 17.6 of Standard 17: Operational risks requires a recognized clearing agency to have a business continuity plan that addresses events posing a significant risk of disrupting operations, including events that could cause a wide-scale or major disruption. The plan should incorporate the use of a secondary site and should be designed to ensure that critical information technology (IT) systems can resume operations within two hours following disruptive events. In the Local Request Notices we had recognized that, currently, a two hour timeframe for resuming operations from a disruptive event may pose operational difficulties for certain clearing agencies. However, we also noted that a recognized clearing agency that performs any of the services of a CCP, CSD or SSS should maintain a reasonable business continuity plan that is designed to meet the two hour resumption period, in line with the emerging industry objective. We had sought feedback on a clearing agency’s current abilities and future prospects to meet the objective of recovering and resuming critical systems and processes within two hours of a disruptive event. One commenter suggested that the proposed timeframe appears arbitrary and may not be the appropriate recovery objective in Canada.
We continue to believe that a CCP, CSD or SSS should maintain a reasonable business continuity plan that is designed to meet the two hour resumption period, in line with the emerging industry trend. The Instrument maintains this requirement, but as a principles-based rule. Section 3.1 of the Instrument requires a clearing agency to have rules, procedures, policies or operations designed to ensure that the clearing agency meets or exceeds Standard 17 (including section 17.6 of the Standard).
(v) Tiered participation arrangements
Standard 19: Tiered participation arrangements requires a recognized clearing agency to identify, monitor, and manage the material risks to the clearing agency arising from any tiered participation arrangements. A tiered participation arrangement occurs when firms (indirect participants) rely on the services provided by other firms – who are direct participants of a clearing agency – to use the clearing agency’s services. In the Local Request Notices, we had asked, among other questions, to what extent can a CCP identify and gather information about a tiered (indirect) participant. Stakeholders generally responded by saying that it is challenging for Canadian clearing agencies to identify or gather meaningful information pertaining to indirect/tiered participants, due to the lack of legal or other contractual relationship between the clearing agency and the indirect participant. Currently, clearing agencies utilize omnibus account structures which enable the clearing agency to distinguish proprietary and client assets, but more granular detail would be needed to permit the clearing agency to identify and measure the activity of indirect participants. Clearing agencies currently have limited recourse to require the necessary information disclosures from indirect participants.
Owing to the significant work that remains for clearing agencies to obtain meaningful information on tiered participation arrangements, the CSA, together with the Bank of Canada, have decided to defer the implementation of Standard 19. We are
16 Collecting margin on a gross basis means that the amount of margin a participant must post to the CCP on behalf of its customers is the sum of the amounts of margin required for each such customer. See footnote 123 of the PFMI report, at p. 84. ICE Clear Canada has recently implemented a gross customer margin segregation and portability framework to enhance customer protection and its ability to port customer positions and collateral in the event of a participant default in accordance with Principle 14. It collects gross margin on futures positions held in dealer customer accounts, a process which requires clearing participants to submit customer level position data daily to the clearing agency. ICE Clear Canada, Inc is a wholly-owned subsidiary of, and designated clearinghouse for ICE Futures Canada, Inc., an electronic trading facility for agricultural futures and options contracts on canola, milling wheat, durum wheat and barley. 17 For a discussion of the benefits and costs of gross margining of customer positions at the CCP level, see the explanatory notes at paragraphs 3.14.7 to 3.14.13 of the PFMI report. 18 The IIROC-CIPF regime and insolvency law for investment dealers provide a customer asset protection regime that applies on a “universal” basis. That is, the IIROC-CIPF regime and Part XII of the BIA protect customers against losses arising from an investment dealer’s insolvency in respect of client assets that are both cash products and derivatives products which IIROC members are permitted to hold on behalf of customers.
November 27, 2014 (2014), 37 OSCB 10488
Request for Comments proposing to develop Joint Supplementary Guidance on the Standard, and will update stakeholders on a proposed transitional period for implementing the Standard in 2015.
(d) Part 4 – Other Requirements of Recognized Clearing Agencies
Some commenters raised concerns about certain requirements in the Local Rules and CPs that appeared different from, or were supplementary to, the PFMIs’ Principles and Key Considerations. They noted that it was unclear how and where other requirements in the Local Rules went beyond, modified, or replaced the PFMI requirements.
We have moved these other requirements into a separate Part 4 of the Instrument, as well as clarified and simplified them. Provisions in the Local Rules that were substantially derived from the PFMIs’ explanatory notes only (i.e., not based on a Principle or Key Consideration) have been removed from the Instrument. Other requirements, which are not derived from the PFMIs, such as rules that are based on other CSA instruments,19 have been retained in the Instrument.
We discuss below a number of the provisions in Part 4 of the Instrument.
(i) Independent director
Section 4.1 of the Instrument requires that a recognized clearing agency’s board of directors include appropriate representation by individuals who are independent of the clearing agency, and are not employees or executive officers of a participant or their immediate family members. Paragraph 3.2(4)(b) of the Local Rules contained a similar provision. We have added provisions in the Instrument (subsections 4.1(3) to (9)) that describe when an individual is considered to be “independent” of a clearing agency, which are generally consistent with its meaning in securities legislation and in the PFMIs.
(ii) Provisions modelled on NI 21-101
A number of provisions in the Local Rules that were modelled on NI 21-101 were maintained in the Instrument, and are contained in Part 4. They are the following sections: 4.6 – Systems requirements (formerly subsection 3.17(5) of the Local Rules); 4.7 – Systems reviews (formerly subsections 3.17(6) and (7) of the Local Rules); 4.8 – Clearing agency technology requirements and testing facilities (formerly subsections 3.17(8) to (11) of the Local Rules); 4.9 – Testing of business continuity plans (formerly paragraph 3.17(12)(d) of the Local Rules); and 4.10 – Outsourcing (formerly subsection 3.17(15) of the Local Rules).
In April 2014 the CSA proposed amendments to update NI 21-101 to reflect developments that have occurred since 2012, including updating the requirements applicable to marketplaces’ systems and business continuity planning (BCP).20 The proposed amendments relating to systems and BCP requirements are intended to help ensure that marketplace systems are reliable, robust and have adequate controls. We are of the view that certain of these amendments may be equally applicable to recognized clearing agencies due to their criticality to our capital markets, specifically:
• Business continuity testing – clarification that testing of BCPs should be conducted according to prudent business practices; and an expectation that the clearing agency facilitates and participates in industry-wide BCP tests;
• Security breaches – new requirement to notify regulators of any material security breach; and
• Expansion of scope of independent systems reviews (ISRs) – a requirement that the scope of the annual ISRs include review of the information security controls of the entity’s auxiliary systems.
The CSA are currently reviewing comments received on the proposed amendments to NI 21-101. To the extent the above requirements are finalized and included in NI 21-101, we will consider including equivalent requirements for this Instrument and Companion Policy as well.
(iii) CCP skin-in-the-game requirement
Section 4.5 of the Instrument requires a recognized clearing agency that operates as a CCP to dedicate and use a reasonable portion of its own capital to cover losses resulting from one or more participant defaults prior to applying the collateral of, or other prefunded financial resources contributed by, the non-defaulting participants. A similar provision was contained in subsection 3.13(8) of the Local Rules. A commenter expressed the view that, while the proposed Local Rule would require “skin
19 For example, National Instrument 21-101 – Marketplace Operation (NI 21-101) and local Rules 91-507 – Trade Repositories and Derivatives Data Reporting. 20 See CSA Notice and Request for Comment – Proposed Amendments to NI 21-101 Marketplace Operation and NI 23-101 Trading Rules, April 24, 2014, (2014), 37 OSCB 4197.
November 27, 2014 (2014), 37 OSCB 10489
Request for Comments in the game” to motivate a clearing agency to act in a manner that would minimize loss and risk to all, given the reputational risk the clearing agency has at stake as the market watches its response to a default, it is unnecessary to add any additional motivating factor.
While this is not a requirement of the PFMIs, we believe that this skin-in-the-game requirement represents international best practice, particularly for CCPs that are operated on a for-profit basis. It promotes risk culture and is a positive signal to the clearing agency’s participants that the owners of the CCP have an equal stake in ensuring the robustness of CCP’s risk management. The Companion Policy provides some guidance on section 4.5 of the Instrument.
(e) Part 5 – Books and Records and Legal Entity Identifier
Section 5.1 of the Instrument is new. While it largely reflects requirements that are, for the most part, already contained in securities legislation, not all books and records requirements in securities legislation of CSA jurisdictions apply necessarily to recognized and exempt clearing agencies.
Section 5.2 of the Instrument, which requires a clearing agency to identify itself by means of a single legal entity identifier, was moved from Part 2 in the Local Rules.
(f) Part 6 – Exemption
Part 6 of the Instrument contains the usual provisions in a CSA national instrument authorizing a regulator or securities regulatory authority, as the case may be, to grant an exemption from any provision of the Instrument.
(g) Part 7 – Effective Dates and Transition
The dates and transition periods proposed in the Local Rules have not been retained in the Instrument, due in large part to the time required to develop the Instrument, and the time that will be required for clearing agencies to address risk management and other gaps to meet the Standards.
We expect that the Instrument will be in force by October 2015. However, the PFMIs represent a substantial strengthening of the previous CPMI-IOSCO standards on SSSs and CCPs. We recognize that clearing agencies may need more time to implement certain aspects of the Standards. Therefore, as discussed above under “(c) Part 3 – International Standards Applicable to Recognized Clearing Agencies”, we are proposing longer transition periods for implementing certain Standards. The CSA will update stakeholders on proposed transitional periods for implementing these Standards at a later time.
(h) Companion Policy
In developing the Companion Policy, the CSA have substantially modified the Local CPs. The Local CPs had contained most of the text comprising the PFMI report’s explanatory notes. We have removed such text, as we believe that reproducing the PFMI report’s explanatory notes in the Companion Policy is unnecessary. However, the removal of such text does not mean that the explanatory notes do not play an important role in interpreting and applying the Standards in the Instrument. On the contrary, as noted in section 3.1 of the Companion Policy, regard is to be given to the explanatory notes in the PFMI report, as appropriate, in interpreting and implementing the Standards. Therefore, the CSA is not intending any policy change by not reproducing the explanatory notes.
Given the above, the content of the Companion Policy has been significantly reduced compared to the Local CPs. The Companion Policy now consists mostly of the Joint Supplementary Guidance developed by the CSA and the Bank of Canada. The Joint Supplementary Guidance is intended to provide additional clarity on certain aspects of some of the Standards within the Canadian context. It is directed at recognized domestic clearing agencies that are also regulated by the Bank of Canada. It is included in separate text boxes in the Companion Policy under the relevant headings of the Standards. We note that other recognized domestic clearing agencies should assess the applicability of the Joint Supplementary Guidance to their respective operations as well.
Joint Supplementary Guidance related to governance standards (Standard 2) was published for comment in the Local CPs. The CSA and Bank of Canada have developed further Joint Supplementary Guidance related to the Standards governing collateral (Standard 5), liquidity risk (Standard 7), general business risk (Standard 15), investment risk (Standard 16), and disclosure of an FMI’s rules, key procedures and market data (Standard 23). Over time, the CSA and Bank of Canada will propose Joint Supplementary Guidance on certain other Standards as well, such as on recovery and orderly wind down plans (Standards 3 and 15) and tiered participation (Standard 19).
November 27, 2014 (2014), 37 OSCB 10490
Request for Comments
V. Authority for Instrument
In those jurisdictions in which the Instrument is to be adopted, the securities legislation provides the securities regulatory authority with rule-making or regulation-making authority in respect of the subject matter of the Instrument.
VI. Alternatives to Instrument Considered
The CSA considered, as general alternatives, adopting the Principles and Key Considerations in a policy, or including them on a case-by-case basis as terms and conditions to a recognition order of a clearing agency. The CSA decided against these alternatives because they believe the PFMIs should be contained in a rule to provide for greater transparency of clearing agency requirements and to promote consistency across all recognized clearing agencies that operate as a CCP, CSD or SSS in carrying on business in a jurisdiction in Canada.
VII. Unpublished Materials
In proposing the Instrument and Companion Policy, the CSA did not rely on any significant unpublished study, report, or other material.
VIII. Anticipated Costs and Benefits
As mentioned in Notice 24-310, the Instrument will enhance the regulatory framework for recognized clearing agencies operating or seeking to operate in a Canadian jurisdiction. This regulatory framework will facilitate ongoing observance by recognized clearing agencies of international minimum standards applicable to FMIs. The CSA believe that the Instrument will support resilient and cost-effective clearing agency operations. It will promote transparency and support confidence among market participants in the ability of clearing agencies to provide efficient and safe clearance and settlement services, which in turn will facilitate capital formation, limit systemic risk, and foster financial stability. Also, the Instrument will further facilitate the efforts of Canadian CCPs to meet the “qualifying CCP” (QCCP) status under the Basel III and Canadian banking guidelines. Canadian and foreign banks that have certain counterparty exposures to Canadian CCPs would be subject to higher capital requirements if these CCPs do not meet the QCCP status.21
The CSA also believe the proposed clearing agency regulatory framework should enhance confidence in the market and better serve market participants. With the adoption of the Instrument, clearing agencies may be better positioned to withstand market volatility and evolve with market developments and technological advancements. Establishing rules that are consistent with current practice and international standards provides a good starting point for promoting appropriate risk management practices.
Finally, the Standards are intended to support the initiatives of the Group of Twenty Finance Ministers and Central Bank Governors (G20) and the Financial Stability Board (FSB) to strengthen core financial infrastructures and markets. To promote consistent global enforcement, the PFMIs are considered minimum requirements, and it is expected that members of CPMI and IOSCO apply the PFMI standards to the fullest extent possible.22 The global and uniform implementation of the PFMIs is considered to be crucial to meeting the G20 commitments for derivative markets regulatory reforms, including requirements for centralized clearing and data reporting.
The CSA acknowledge that implementing the Standards will entail costs for the industry. Recognized clearing agencies in Canada have begun the transition to the new Standards by conducting detailed self-assessments against the Principles and Key Considerations and identifying their current gaps in observance. They are currently developing plans to address those gaps, but it will take some time for them to meet all the Standards. As noted previously, we are therefore proposing longer transition periods for implementing certain Standards.
IX. Regulations or Other Instruments to be Amended or Revoked (Ontario only)
OSC Staff Notice 24-702 Regulatory Approach to Recognition and Exemption from Recognition of Clearing Agencies will be withdrawn upon the implementation of the Instrument and Companion Policy.
21 See CSA Multilateral Staff Notice 24-311 Qualifying Central Counterparties, July 28, 2014, at http://www.osc.gov.on.ca/en/SecuritiesLaw_ csa_20140728_24-311_sn-qualifying-central-counterparties.htm. 22 CPMI and IOSCO have stated that they expect full, timely and consistent implementation of the PFMIs by the authorities in all member- jurisdictions. In this regard, they have established an international task force to monitor implementation of the PFMIs by relevant authorities. Reports on PFMI implementation by CPMI and IOSCO members, including the OSC, AMF, BCSC and Bank of Canada, are available on the Bank for International Settlements’ website (http://www.bis.org/cpss/index.htm) and the IOSCO website (http://www.iosco.org/library/ index.cfm?section=pubdocs).
November 27, 2014 (2014), 37 OSCB 10491
Request for Comments
X. Comment Process
Please submit your comments in writing on or before February 10, 2015. If you are not sending your comments by email, please include a CD containing the submissions. Address your submission to the following CSA member commissions:
British Columbia Securities Commission Alberta Securities Commission Financial and Consumer Affairs Authority of Saskatchewan Manitoba Securities Commission Ontario Securities Commission Autorité des marchés financiers Nova Scotia Securities Commission Financial and Consumer Services Commission (New Brunswick) Office of the Attorney General, Prince Edward Island Securities Commission of Newfoundland and Labrador Superintendent of Securities, Yukon Superintendent of Securities, Northwest Territories Superintendent of Securities, Nunavut
Please deliver your comments only to the addresses that follow. Your comments will be forwarded to the remaining CSA member jurisdictions.
The Secretary Ontario Securities Commission 20 Queen Street West, 22nd Floor Toronto, Ontario M5H 3S8 Fax: 416-593-2318 E-mail: [email protected]
Me Anne-Marie Beaudoin Corporate Secretary Autorité des marchés financiers 800, square Victoria, 22e étage C.P. 246, tour de la Bourse Montréal (Québec) H4Z 1G3 Fax : 514-864-6381 E-mail: [email protected]
Please note that comments received will be made publicly available and posted on the Websites of certain CSA jurisdictions. We cannot keep submissions confidential because securities legislation requires that a summary of the written comments received during the comment period be published. In this context, you should be aware that some information which is personal to you, such as your e-mail and address, may appear in the websites. It is important that you state on whose behalf you are making the submission.
Additionally, where comments pertain specifically to the Joint Supplementary Guidance (as presented in text boxes within the Companion Policy), we request that these particular comments also be sent to the Bank of Canada at the following email address:
Questions with respect to this Notice, or the Instrument and Companion Policy, may be referred to:
Antoinette Leung Manager, Market Regulation Ontario Securities Commission Tel: (416) 593-8901 Email: [email protected]
Maxime Paré Senior Legal Counsel, Market Regulation Ontario Securities Commission Tel: (416) 593-3650 Email: [email protected]
November 27, 2014 (2014), 37 OSCB 10492
Request for Comments
Oren Winer Legal Counsel, Market Regulation Ontario Securities Commission Tel: (416) 593-8250 Email: [email protected]
Michael Brady Senior Legal Counsel British Columbia Securities Commission Tel: (604) 899-6561 Email: [email protected]
Doug MacKay Manager, Market and SRO Oversight Capital Markets Regulation British Columbia Securities Commission Tel: (604) 899-6609 Email: [email protected]
Heather Forester Legal Counsel Alberta Securities Commission Tel: (403) 592-3055 Email: [email protected]
Paula Kaner Manager, Market Oversight Alberta Securities Commission Tel: (403) 355-6290 Email: [email protected]
Paula White Manager Compliance and Oversight Manitoba Securities Commission Tel: (204) 945-5195 Email: [email protected]
Claude Gatien Director, Clearing houses Autorité des marchés financiers Tel: (514) 395-0337 extension 4341 Toll free: 1-877-525-0337 Email: [email protected]
Martin Picard Senior Policy Advisor, Clearing houses Autorité des marchés financiers Tel: (514) 395-0337 extension 4347 Toll free: 1-877-525-0337 Email: [email protected]
Liz Kutarna Deputy Director, Capital Markets, Securities Division Financial and Consumer Affairs Authority of Saskatchewan Tel: (306) 787-5871 Email: [email protected]
Susan Powell Deputy Director, Securities Financial and Consumer Services Commission (New Brunswick) Tel: (506) 643-7697 Email: [email protected]
November 27, 2014 (2014), 37 OSCB 10493
Request for Comments
APPENDIX “A”
SUMMARY OF COMMENTS TO PROPOSED LOCAL RULES 24-503 CLEARING AGENCY REQUIREMENTS AND RELATED LOCAL CPS, AND CSA GENERAL RESPONSES TO COMMENTS1
1. Theme/question2 2. Summary of comments 3. General responses
General
Purposes of the One commenter disagrees with the drafting We have addressed this concern. See “IV. proposed Local Rule and approach chosen to achieve the purposes Summary of Instrument and Companion Policy” in approach to drafting of the proposed Local Rule (i.e. adopting the Notice. the PFMIs in a rule). The commenter feels that differences, however modest, between the PFMIs and the proposed Local Rule would require complex, time consuming and costly analyses of such differences (including what, if any, non-PFMI provisions have been added to the proposed Local Rule).
The commenter enumerates several possible consequences resulting from the approach (which necessitates analyses of possible differences from the PFMIs):
• it may deter participants and clearing agencies from entering/expanding in the Canadian market, leading to less competition, liquidity and stability as a whole;
• clearing agencies that have begun self-assessments according to PFMI standards would have to reconsider the proposed Local Rule requirements;
• domestic clearing agencies held to more rigorous provincial requirements than those based in foreign jurisdictions would be disadvantaged by an uneven playing field;
• CPMI-IOSCO implementation monitoring efforts of the PFMIs would be confused by potentially different standards imposed on Canadian clearing agencies;
• foreign regulators would have difficulty assessing equivalency of the proposed Local Rule to their own PFMIs-based requirements; and
• assessment as a “qualifying CCP” (QCCP) could be made more difficult and uncertain, should the Local Rule’s
1 Columns 1 and 2 are reproduced from Appendix “B” to Notice 24-310. Column 3 is new. 2 A reference to a provision (i.e., section, subsection, paragraph, etc.) is a reference to a provision of the proposed Local Rule, unless otherwise indicated.
November 27, 2014 (2014), 37 OSCB 10494
Request for Comments
1. Theme/question2 2. Summary of comments 3. General responses
requirements be seen as different from, or potentially imposing lower standards than, the PFMIs.
The commenter expresses that the stated purposes of the proposed Local Rule could be achieved by requiring direct compliance with the international standards, and only adding to a proposed Local Rule the additional requirements that would be unique to a province.
Unified approach to rule- A commenter is concerned that the We have addressed this concern by proposing a drafting complexity of analyzing the differences National Instrument. between the proposed Local Rule and the PFMIs would be magnified by the impact of each jurisdiction enacting its own rule. The commenter calls for a unified approach to drafting and implementing the proposed Local Rule amongst the provincial/territorial regulators.
Requirements pursuant One commenter says that it was unclear We note that Part 3 of the Instrument, which to existing terms and whether certain recognized/exempt implements the Standards/PFMIs, will apply to conditions clearing agencies would be required to recognized clearing agencies only. For the most continue to comply with an existing term part, we would exempt foreign clearing agencies and condition that requires compliance with carrying on business in Canada. As such, we would the PFMIs, possibly in addition to the rely on the regulations governing, and the oversight proposed Local Rule. of, the clearing agency in its home jurisdiction, including the local rules or policies that implement the PFMIs. Where a foreign clearing agency is recognized by us because, for example, we judge it to be systemically important to our capital markets, Part 3 of the Instrument will apply. However, in view of the principles-based approach and drafting of the Standards that mirror the Principles and Key Considerations, we do not believe that compliance with Part 3 will be a burden. As such, a foreign clearing agency should not experience duplication and inefficiency of cross-border regulation. To the extent that a recognized foreign clearing agency faces a conflict or inconsistency between the requirements of sections 2.2, 2.5 and Part 4 of the Instrument and the terms and conditions of its existing order, Part 6 of the Instrument provides that the securities regulatory authority may grant an exemption from a provision of the Instrument, in whole or in part, subject to appropriate conditions or restrictions.
Foreign-based entities’ A commenter is concerned that the See response above. compliance with proposed Local Rule is not clear whether proposed Local Rule, foreign-based clearing agencies that are and equivalence and recognized in a province will be required to mutual recognition comply with all new provisions, or may approaches continue to abide by terms and conditions in their existing recognition orders. The commenter notes that adhering to the proposed Local Rule’s Part 3 provisions
November 27, 2014 (2014), 37 OSCB 10495
Request for Comments
1. Theme/question2 2. Summary of comments 3. General responses
would be duplicative and inefficient when considering the regulation in a home jurisdiction, whereas current terms and conditions already address the balance with the home jurisdiction’s regulation.
Two commenters highlight a need for See response above. We do not believe that an access to third-country markets / clearing equivalency regime and process similar to the EMIR agencies under the concepts of regime is necessary at this time. Part 3 of the equivalence and mutual recognition. One Instrument, which implements the Standards/PFMIs, commenter suggests that an equivalence will apply to recognized clearing agencies only. For test be based on transparent, the most part, we would exempt foreign clearing proportionate, fair and objective grounds, agencies carrying on business in Canada. As such, and should be judged on an outcome- we would rely on the regulations governing, and the determinative basis that looks to the PFMIs oversight of, the clearing agency in its home for guidance, so as to recognize the jurisdiction, including the local rules or policies that differences in legal and regulatory implement the PFMIs. Where a foreign clearing structures around the world. agency is recognized by us because, for example, we judge it to be systemically important to our The commenters advocate for a process capital markets, Part 3 of the Instrument will apply. similar to the EMIR scheme for the However, in view of the principles-based approach recognition of third country CCPs, which and drafting of the Standards that mirror the relies on an equivalence assessment of the Principles and Key Considerations, we do not home country’s legal and regulatory believe that compliance with Part 3 will be a burden. structure and an MOU between ESMA and the relevant regulator. The commenters also note that terms and conditions would have to be appropriate in light of the supervision and oversight being carried out in multiple jurisdictions, and that reliance should be placed on the regulations in the home jurisdictions to implement the PFMIs in place of direct application of CSA requirements on third country CCPs.
Part 2: Clearing agency recognition or exemption from recognition
Request Notice question A commenter notes that the proposed The Companion Policy describes a broad range of 1: Are there other factors definition should include (a) the extent to guiding factors in determining the systemic that could be considered which failure of a clearing agency would importance of a clearing agency. These factors are in determining systemic require the use of public funds to maintain non-exhaustive. They inherently would include importance of a clearing the stability of Canada’s financial scenarios described by the commenter. agency to the relevant infrastructure, and (b) the impact a clearing province? If so, please agency failure would have on Canada’s describe such factors financial infrastructure. and your reasons for including them. A commenter notes that it would be useful See response above. to view the criteria within the context of the Subsections 2.0(2)-(5) of currencies in which an FMI’s obligations the proposed CP – are denominated, since any effects in systemic importance Canada may depend on the value of an FMI’s CDN dollar-denominated transactions.
A commenter suggests that the linkages See response above. between the clearing agency and other CCPs should be considered, including instances in which they assume exposure to one or more CCPs, as well as how such
November 27, 2014 (2014), 37 OSCB 10496
Request for Comments
1. Theme/question2 2. Summary of comments 3. General responses
exposures are managed.
A commenter suggests that any risk See response above. exposure of the clearing agency to counterparties that are not residents of a relevant province but are systemically important to those residents should be considered.
A commenter highlights the absence of an Canadian securities legislation generally provides appeal mechanism for parties who wish to for appeal mechanisms for reviewing a decision have their determination of systemic made by a regulator or securities regulatory importance reviewed. authority.3
Significant changes and A commenter notes that the advanced Subsection 2.2(2) of the Instrument prohibits a other changes in approval requirement for significant recognized clearing agency from implementing a information changes and notification of fee changes is “material change” without obtaining the prior written inconsistent with international regulations approval of the securities regulatory authority. Section 2.2 and thus puts domestic clearing agencies However, the provision does not contain any on an uneven playing field relative to timeline or process for obtaining such approval. We foreign-based clearing agencies, who may note that, typically, the terms and conditions of a make such changes more quickly. The recognition decision will contain provisions commenter describes that CFTC governing the process and timelines for obtaining regulations for derivatives clearing prior approval of a material change. To the extent agencies, for example, require only self- possible, the securities regulatory authority will certification of rule changes with the CFTC consider the rule approval or self-certification ten business days in advance of the process of another jurisdiction’s regulations to which change. The commenter requests aligning the clearing agency is subject when imposing the the requirements with those of the CFTC. terms and conditions. This consideration may be carried out in concert with Part 6 of the Instrument, which provides that a securities regulatory authority may grant an exemption from a provision of the Instrument, in whole or in part, subject to appropriate conditions or restrictions.
Filing of initial audited A commenter notes that while it plans to We have addressed this concern. See section 2.4 of financial statements adopt the use of IFRS in the near future, it the Instrument. currently prepares its financial statements Section 2.4 in accordance with UK GAAP, as per its home regulator’s requirements. It requests confirmation that the provincial/territorial regulators will flexibly implement s. 2.4 to allow conformation with local regulatory requirements and that the provision will not negatively impact its operations in the relevant province.
Filing of annual audited A commenter urges the provincial/territorial See subsection 2.5(2) of the Instrument. and interim financial regulators to extend the approach taken statements under s. 2.2 – to allowing alternate means to meeting the provision’s requirement for Section 2.5 foreign-based entities, as specified in its recognition/exemption order – to the requirements of s. 2.5. The commenter notes that some home country regimes do not require interim financial statements to
3 In Ontario, see sections 8 and 9 of the OSA. In Quebec, see sections 169.1 and 322 of the Securities Act (Quebec) and sections 14 and 113 of the Derivatives Act (Quebec).
November 27, 2014 (2014), 37 OSCB 10497
Request for Comments
1. Theme/question2 2. Summary of comments 3. General responses
be audited.
Part 3: On-going requirements applicable to recognized clearing agencies
Section 3.2 – Governance
Joint Supplementary A commenter felt that the statement “the The Joint Supplementary Guidance has been Guidance Box 2, Item 1 FMI functions should be legally separated amended. It now provides for an option: where an from other functions performed by the FMI is part of a larger consolidated entity, it must Subsection 3.2(2) of the consolidated entity in order to maximize either: (i) legally separate FMI-related functions from proposed CP bankruptcy remoteness of the FMI non-FMI-related functions performed by the functions” does not align with the PFMIs consolidated entity in order to maximize bankruptcy paragraph 3.2.6. The commenter interprets remoteness of the FMI-related functions; or (ii) have that the PFMIs describe legal separation as satisfactory policies and procedures in place to a consideration when services present a manage additional risks resulting from the non-FMI- distinct risk profile from, or pose additional related functions appropriately to ensure the FMI’s risks to, its existing functions. So, whereas financial and operational viability. legal separation may be effective for multi- functional risks on a case-by-case basis, it is just one mechanism, in addition to, for example, effective governance and containment of risk through contractual terms.
Role of the chief A commenter feels that the requirement This provision has been substantially retained in compliance officer could impose significant effort and cost on section 4.3 of the Instrument, which governs the a clearing agency registered in multiple requirements for having a Chief Risk Officer and Paragraph 3.2(7)(d) jurisdictions. Alternatively, the commenter Chief Compliance Officer. To the extent a proposes that recognized foreign clearing recognized foreign clearing agency is subject to agencies be able to leverage similar requirements of its home jurisdiction that achieve information/reports provided to other equivalent regulatory outcomes, Part 6 of the regulators or information in its CPMI- Instrument provides that a securities regulatory IOSCO FMI Disclosure Framework authority may grant an exemption from a provision Document. of the Instrument, in whole or in part, subject to appropriate conditions or restrictions.
Transparency of major A commenter proposes that, before a major This requirement is essentially retained in section decisions decision that has a potential broad market 2.7 of Standard 2. We believe that a principles- impact is published, the clearing agency based approach to this standard would provide the Subsection 3.2(13) should be permitted to make a case for flexibility to the clearing agency to make a case for non-publication on the grounds of possible non-publication on the grounds of possible negative negative impact to financial stability in any impact to financial stability, and to consult with, and of the jurisdictions in which it operates. seek the approval of, its home-jurisdiction regulator Also, the publication should be made only and/or the regulator of any other impacted with the approval of a relevant home- jurisdiction. jurisdiction regulator and/or regulator of any other impacted jurisdiction.
A commenter also notes that it would make We agree that section 2.7 of Standard 2 applies sense that ss. 3.2(13) should only apply to only to major decisions made by the board of determinative decisions of a clearing directors of the clearing agency. agency’s Board, since other (more preliminary or interim) resolutions may be confusing, misleading or inappropriately market-moving.
November 27, 2014 (2014), 37 OSCB 10498
Request for Comments
1. Theme/question2 2. Summary of comments 3. General responses
Section 3.5 – Collateral and Section 3.7 – Liquidity risk
Collateral – general A commenter says it is essential that letters Consistent with footnote 63 of the PFMI report, in principle of credit be perceived as permitted general we do not believe that letters of credit or collateral, notwithstanding that the wording other forms of guarantees are acceptable collateral. Subsection 3.5(1) of the provision does not specifically However, guarantees that are fully backed by suggest otherwise. The commenter collateral may be acceptable in rare circumstances, requests positive clarity that letters of credit subject to regulatory approval. See also the Joint are intended to be included. Supplementary Guidance on collateral.
Collateral and liquidity A commenter requests flexibility in the See the Joint Supplementary Guidance on risk eligible collateral a clearing agency can collateral. However, we note that such guidance is accept, as certain financial industries, such applicable to recognized domestic clearing agencies Sections 3.5, 3.7 as the life insurance industry, tend to hold only. If a foreign clearing agency is unwilling to long-dated corporate securities to support accept long-dated Canadian corporate bonds and the long-term nature of their activities. The other securities, we do not believe it is appropriate commenter suggests that such participants for us to intervene to encourage them to accept would incur significant costs in obtaining such types of securities if they are not acceptable more liquid assets to post as collateral with from a risk-management perspective. a clearing agency. It requests that long term assets, such as high grade corporate bonds, be considered eligible.
Qualifying liquid With respect to par. 3.7(8)(a), a commenter We do not agree. The Joint Supplementary resources notes that there is minimal liquidity risk with Guidance on liquidity risk makes it clear that an FMI respect to major currencies and any must have qualifying liquid resources for liquidity Subsections 3.7(8) and potential concerns could be addressed exposures denominated in the same currency as (9) through a foreign haircut allowance, if the resources. necessary. The commenter interprets that PFMIs paragraph 3.7.10 contemplates holding liquid resources in more than one currency, but does not strictly require that the currency of liquid resources must exactly match the currency of the obligations. Further, if highly marketable collateral held in investments are permitted, given the standardization and marketability of major currencies, it does not seem reasonable to require that cash must be held in the same currency of the obligation.
With respect to par. 3.7(8)(b), a commenter If a particular letter of credit would be considered a requests that committed lines of credit be committed line of credit by an underwriting bank, it expanded to include letters of credit, as would qualify. they are committed obligations of an underwriting bank.
With respect to par. 3.7(8)(e) and the See the Joint Supplementary Guidance on posting of bonds as collateral, a collateral. See also, above, our comment on the commenter notes that it is not clear what is acceptability of long-dated Canadian corporate included as “highly marketable collateral” or bonds and other securities by a foreign clearing what funding arrangements would qualify agency. as prearranged and highly reliable. The commenter is concerned that should customers not be able to post bonds as collateral with clearing members, because they in turn cannot post bonds to a clearing agency, customers or clearing members will be required to enter into repurchase
November 27, 2014 (2014), 37 OSCB 10499
Request for Comments
1. Theme/question2 2. Summary of comments 3. General responses
transactions to raise cash to post, which may impose additional costs without reducing systemic risk.
Section 3.13 – Participant default rules and procedures
Use and sequencing of A commenter asserts that it is not practical This provision in the Local Rules has not been financial resources for a clearing agency to pre-commit to use retained in the Instrument. We note, however, that particular liquidity resources in a specific the requirement was consistent with the explanatory Subsection 3.13(3) order; rather the use of various resources note in par. 3.13.3 of the PFMI report. to meet time-sensitive needs will depend on the details of a default situation. Also, the inclusion of such a hierarchy in publicly disclosed rules (or only to members) could make the clearing agency vulnerable to gaming by market participants. Accordingly, any plan for using liquidity resources should remain confidential, or at least disclosed only at a high level.
Testing of default A commenter requests that only entities We believe this concern is addressed through the procedures that clear positions for their clients’ futures explanatory notes of the PFMIs. Paragraph 3.13.7 commission merchant (FCM) services or of the PFMI report expressly contemplates that tests Subsection 3.13(6) that are involved in loss mutualization be should include all “relevant parties or an appropriate involved as the required participants and subset” that would likely be involved in the default stakeholders for the testing of a clearing procedures, such as members of the appropriate agency’s default rules and procedures. The board committees, participants, linked or commenter explains that for clearing interdependent FMIs, relevant authorities, and any members of a private, non-mutualized related service providers. Moreover, a principles- clearing agency, clearing members are based approach to applying section 13.4 of clearing for their own accounts, and do not Standard 13 would provide some flexibility in provide services typically afforded by determining the relevant “stakeholders” for the FCMs. Accordingly, in the event of a testing of a clearing agency’s default rules and default and close out, non-defaulting procedures. participants are neither impacted nor included in the process. As such, these members are unwilling to, and see little value in being involved in the testing and review of relevant procedures.
Use of own capital A commenter expresses that, while the See the discussion in the Notice on section 4.5 of PFMIs contemplate that an FMI using its the Instrument under “IV. Summary of Instrument Subsection 3.13(8) own resources is an option for the and Companion Policy and Ongoing Policy Matters, management of a default, it is not actually (d) Part 4 – Other Requirements of Recognized required. Further, while the proposed Local Clearing Agencies, (iii) CCP skin-in-the-game Rule may require ‘skin in the game’ to requirement”. motivate a clearing agency to act in a manner that would minimize loss and risk to all, given the reputational risk the clearing agency has at stake as the market watches its response to a default, it is unnecessary to add any additional motivating factor.
Section 3.14 – Segregation and portability
General comments A commenter expresses concern that, in See the discussion in the Notice on segregation and the context of a securities firm insolvency, portability under “IV. Summary of Instrument and the application of Principle 14 to all markets Companion Policy and Ongoing Policy Matters, (c)
November 27, 2014 (2014), 37 OSCB 10500
Request for Comments
1. Theme/question2 2. Summary of comments 3. General responses
may impede or negate the ability of a Part 3 – International Standards Applicable to trustee in bankruptcy, as well as investor Recognized Clearing Agencies, (iii) Segregation and protection funds, from returning the firm’s portability”. client funds, and will only move the Canadian framework closer to the US model, in spite of the well-received Canadian performances to date. Whereas collateral would have to be held on a gross basis by the CCP, CIPF coverage would be impacted because assets held at the CCP would not vest with the CIPF trustee. Indeed, the principle of pooling assets for pro-rata distribution – the cornerstone of Part XII of the Bankruptcy and Insolvency Act – would no longer be applied to all clients.
A commenter notes that in the particularly See response above. complex area of open futures positions, the application of Principle 14 would negatively affect the ability of CIPF to provide customer protection, if the CCP has custody of clients’ assets and it does not vest in a trustee.
A commenter expresses concern about the See response above. impact to IIROC members when applying Principle 14. Such members would not have the same degree of collateral available to them for their use, where there is a different margin requirement by the CCP vs. the clearing member.
A commenter expresses concern about the See response above. operational issues and impacts related to a CCP undertaking the responsibility to move client assets, especially because the CCP may not have client account information which is held by a clearing member.
Customer account A commenter suggests to replace “or” with See the discussion in the Notice under “IV. structures and transfer of “and/or” to accommodate clearing Summary of Instrument and Companion Policy and positions and collateral members who clear for a combination of Ongoing Policy Matters, (c) Part 3 – International clients that include both individual and Standards Applicable to Recognized Clearing Subparagraph omnibus accounts. Agencies, (i) Implementation of the PFMIs as rule 3.14(4)(a)(ii) requirements”. The Standards in Appendix A to the Instrument are largely a reproduction of the text of the 23 Principles and their respective Key Considerations.
Request Notice question Three commenters argue that CCPs See the discussion in the Notice on segregation and 2: Do you agree with the serving the cash markets should not be portability under “IV. Summary of Instrument and current drafting approach required to obtain an “exemption” from Companion Policy and Ongoing Policy Matters, (c) of section 3.14 of the section 3.14, as the wording of Principle 14 Part 3 – International Standards Applicable to Rule, i.e., requiring all should be understood to allow, as a matter Recognized Clearing Agencies, (iii) Segregation and CCPs to meet Principle of course, the application of its “alternate portability”. 14 in its entirety (without approach” to cash market CCPs that referencing the alternate provide the same protections as those approach), and granting envisioned by the Principle (as explained in
November 27, 2014 (2014), 37 OSCB 10501
Request for Comments
1. Theme/question2 2. Summary of comments 3. General responses
exemptions on a case- PFMIs paragraph 3.14.6). The commenters by-case basis to those express that an “exemption” may imply that CCPs for which the the CCP employs a weaker approach to alternate approach is investor protection than that which is appropriate? otherwise required by the PFMIs.
A commenter is unsure whether timely See response above. portability could be achieved without supporting legislation to ensure a release of funds within a certain period.
Request Notice question Three commenters conclude that cash See response above. 3: Should all CCPs market CCPs should be able to serving the Canadian demonstrate how they fit within the cash markets be able to alternate approach, if they satisfy the avail themselves of the criteria set out in paragraph 3.4.16 of the alternate approach to PFMIs. The combination of IIROC rules, implementation of CIPF customer protection (that extends to Principle 14? How could all assets held in a customer’s account, such CCPs demonstrate including securities, cash balances, that customer assets and commodities, futures contracts, segregated positions are protected to insurance funds or other property) and the the same degree Part XII Bankruptcy and Insolvency Act envisioned by Principle scheme, in the Canadian regulatory 14? environment should be conducive to satisfying this alternate approach. At least one commenter feels that the alternate approach should extend to all CCPs not serving the OTC derivatives markets.
Two commenters argue that unintended See response above. consequences would be severe if CCPs serving markets other than the OTC derivatives markets were not able to avail themselves of the alternate approach.
A commenter describes several See response above. consequences that might arise if the alternate approach is unavailable for non- OTC market CCPs: (1) the efficiencies achieved by netting trades would be lost as segregation and portability requirements would force CCPs to decompose netted trades, thereby increasing costs to the CCP and reducing the risk reduction provided by netting; (2) costly changes would be required to the CCP’s margining system, in order to margin positions at a gross level; (3) for CCPs without cross-product margining, the introduction of portability could result in higher margin requirements for legitimate market activity; (4) CCPs would have to develop a communication mechanism to inform investors of their collateral/positions in the event of a CCP participant insolvency; and (5) market participants would be negatively impacted by having to undertake significant reconciliation efforts, as each trade would
November 27, 2014 (2014), 37 OSCB 10502
Request for Comments
1. Theme/question2 2. Summary of comments 3. General responses
have to be individually inspected to note the client and its corresponding collateral.
A commenter suggests that CCPs could See response above. demonstrate their protection of customer assets and positions through disclosure of: (i) the nature of the information held in respect of individual clients; (ii) the roles and responsibilities of surviving participants under default scenarios; and (iii) the processes and procedures to be followed by the CCP and its surviving participants in these circumstances. It is also suggested that for CCPs obligated to test default management processes, the processes enabling portability of positions and collateral should also be tested.
Section 3.15 – General business risk
Determining sufficiency A commenter requests that the last We have added such sentence in section 15.3 of of liquid net assets sentence of PFMI key consideration 15.3 Standard 15 in Appendix A to the Instrument. be included in section 3.15(3) in order to Subsection 3.15(3) avoid duplicate capital requirements by permitting the inclusion of equity held under international risk-based capital standards, where appropriate.
Section 3.16 – Custody and investment risks
Investment strategy A commenter is concerned that public Section 16.4 of Standard 16 in Appendix A to the disclosure of its investment strategies could Instrument says that a clearing agency should “fully Subsection 3.16(4) negatively impact its ability to invest large disclose” its investment strategy to its participants. amounts of cash on a daily basis. It We do not believe that the same type of disclosure requests that investment strategies only be would be required for the public. See also Standard disclosed at a high level and only to 23, which governs certain types of public participants. disclosures.
Section 3.17 – Operational risks
Operational capacity, A commenter suggests that an alternative This requirement is now contained in Part 4 of the systems requirements, should be available for foreign-based Instrument, which applies only to recognized and incident recognized clearing agencies. It requests clearing agencies. To the extent that a recognized management that this alternative be provided in the foreign clearing agency is subject to requirements in clearing agency’s recognition order or its home jurisdiction that achieve equivalent Paragraph 3.17(5)(e) ‘notice and approval protocol’. regulatory outcomes, Part 6 of the Instrument provides that a securities regulatory authority may grant an exemption from a provision of the Instrument, in whole or in part, subject to appropriate conditions or restrictions.
Operational capacity, A commenter requests that public We have clarified this in section 4.8 of the systems requirements, disclosure under these subsections not Companion Policy. and incident include detailed proprietary information. management
Subsections 3.17(8), (9)
November 27, 2014 (2014), 37 OSCB 10503
Request for Comments
1. Theme/question2 2. Summary of comments 3. General responses
Operational capacity, In respect of paragraph (b), one See previous two responses above. systems requirements, commenter suggests that the provision and incident should allow a foreign-based recognized management clearing agency to meet the requirement in a manner described in the terms and Subsection 3.17(11): conditions of its recognition order or ‘notice and approval protocol’.
In respect of paragraph (c), one commenter expresses concern that the scope of this disclosure requirement is too broad. It suggests that it be narrowed to only include non-sensitive information that is not proprietary in nature.
Request Notice question A commenter requests further clarity with See the discussion in the Notice under “IV. 4: What are a clearing respect to whether (i) the ability of a Summary of Instrument and Companion Policy and agency’s current abilities clearing agency to meet the two hour Ongoing Policy Matters, (c) Part 3 – International and future prospects to requirement would impact how the Standards Applicable to Recognized Clearing meet the objective of requirement is applied, and (ii) whether Agencies, (iv) Resumption of operation within two recovering and resuming more than two hours may be permitted, if hours after disruptive events”. critical systems and necessary. The commenter notes that the processes within two proposed timeframe appears arbitrary and hours of a disruptive may not be the appropriate recovery event? Should recovery objective in Canada. and resumption-time objectives differ A commenter notes that recovery and See response above. according to critical resumption time objectives should not differ importance of markets? from market to market, based on critical importance. Subparagraph 3.17(12)(c)(i)
Section 3.19 – Tiered participation arrangements
Request Notice question A commenter requests further clarity as to See the discussion in the Notice under “IV. 5: To what extent can a whether (i) the ability of the clearing agency Summary of Instrument and Companion Policy and CCP identify and gather to meet the requirement would impact how Ongoing Policy Matters, (c) Part 3 – International information about a the requirement is applied, and (ii) the type Standards Applicable to Recognized Clearing tiered (indirect) and extent of the information that would be Agencies, (v) Tiered participation arrangements”. participant? required to be gathered.
Section 3.19 A commenter submits that it is challenging See response above. for Canadian CCPs to identify or gather meaningful information pertaining to indirect/tiered participants, due to the lack of legal or other contractual relationship between the CCP and the indirect participant, and more generally, because Canadian clearing models are founded on the ‘principal model’. The model utilizes omnibus account structures which enable the CCP to distinguish proprietary and client assets, but more granular detail would be needed to permit the CCP to identify and measure the activity of indirect participants. CCPs have limited recourse to require the necessary information disclosures from indirect participants.
November 27, 2014 (2014), 37 OSCB 10504
Request for Comments
1. Theme/question2 2. Summary of comments 3. General responses
A commenter notes that CCPs are able to See response above. gather sufficient information about their indirect participants to be able to manage the risks they pose.
Request Notice question A commenter agreed that all cited risks are See response above. 6: In Canada, what types present in tiered participation of risks (such as credit, arrangements. liquidity, and operational risks) arise in tiered participation arrangements between customers and direct participants or between customers and other intermediaries that provide clearing services to such customers?
Request Notice question A commenter described that the control, See response above. 7: How can a clearing mitigation and management of risks would agency properly manage require, at a minimum, the disclosure of the risks posed by tiered client accounts and/or securities positions participation by direct CCP participants. Doing so would arrangements? allow the CCP to meet the minimum standards of Principle 14 and would allow a CCP to modify or calibrate its risk model towards the effective management of the credit and liquidity risks that tiered participants introduce to the clearing system.
A commenter suggests two layers of See response above. controls to help manage risks posed by tiered participation arrangements: (i) require the clearing agency to gather detailed information on the direct participant’s customer activity in order to identify relationships and positions at the indirect participant level, and (ii) require the clearing agency to act on the information within a risk policy framework that identifies, signals and monitors risks and risk concentrations and which, where appropriate, provides incentives for participants to reduce these risks and concentrations.
Section 3.23 – Transparency
Changes to rules and A commenter requests that a clearing While this provision has not been retained in the procedures agency’s disclosure of changes to its rules Instrument, section 23.1 of Standard 23 in Appendix and procedures be limited to only what is A to the Instrument requires a recognized clearing Subsection 3.23(5) required by its recognition order or ‘notice agency to adopt clear and comprehensive rules and and approval protocol’. It also expresses its procedures that are fully disclosed to participants. It belief that disclosure should be limited to also requires that relevant rules and key procedures services over which the regulatory authority be publicly disclosed. possesses jurisdiction.
November 27, 2014 (2014), 37 OSCB 10505
Request for Comments
1. Theme/question2 2. Summary of comments 3. General responses
We note, however, that the requirement was consistent with the explanatory note in par. 3.23.3 of the PFMI report, which says that a clearing agency should have a clear and fully disclosed process for proposing and implementing changes to its rules and procedures and for informing participants and relevant authorities of these changes.
Part 5: Effective dates and transition
Section 5.1 A commenter requests that, where a Effective dates and transition periods have been clearing agency has already carried out significantly modified in the Instrument. See the preparatory work or has dedicated discussion in the Notice under “IV. Summary of resources to PFMIs implementation plans Instrument and Companion Policy and Ongoing (that have been approved by its Policy Matters, (g) Part 7 – Effective Dates and regulators), the transition periods should Transition”. take such efforts into account. The commenter also requests that where the CSA’s implementation of the PFMIs differ from CPMI-IOSCO, that the CSA provide a mechanism through which PFMI requirements that are substantively similar to the CSA requirements be grandfathered under the proposed Local Rule.
In respect of the interaction of CSA Staff This comment has been referred to the CSA Notices 91-303 and 91-304, one Derivatives Committee, which is working on Revised commenter notes that there are significant Model Rule 91-304. operational implications and unknowns for customers, in terms of setting up procedures to deal with derivatives clearing agencies (DCAs) and clearing members. Accordingly, there will need to be transition time once DCAs are established and before all clearing requirements are implemented. The commenter also expresses concern that it is unclear how many DCAs will exist and how they will be differentiated, leading to the possibility that transactions that would otherwise net to zero may be required to clear at different derivatives clearing agencies, thereby resulting in exposures that are not being offset.
Subsection 5.1(2) A commenter suggests that sections 3.4- We will raise this comment with the CSA Derivatives 3.7 should have the same effective date as Committee. CSA Staff Notices 91-303 and 91-304 in order to ensure customers have the protection of risk management tools when clearing trades.
Request Notice question A commenter notes that successful See the discussion in the Notice under “IV. 8: Are the above implementation under the proposed Summary of Instrument and Companion Policy and transition periods timeline may be difficult. Ongoing Policy Matters, (g) Part 7 – Effective Dates appropriate? If yes, and Transition”. please give your reasons. If not, what alternative transition
November 27, 2014 (2014), 37 OSCB 10506
Request for Comments
1. Theme/question2 2. Summary of comments 3. General responses
periods would balance the CPMI-IOSCO’s expectation of timely implementation of the PFMIs and the practical implementation needs of our markets?
Subsection 5.1(3)
November 27, 2014 (2014), 37 OSCB 10507
Request for Comments
APPENDIX “B”
COMPARISON OF THE STANDARDS IN APPENDIX A TO NI 24-102 AND TEXT OF THE PRINCIPLES AND KEY CONSIDERATIONS IN PFMI REPORT
Disclaimer
This document provides a comparison between the Standards in Appendix A to NI 24-102 and the text of the 23 relevant Principles and their respective Key Considerations in the PFMI report. It is intended to assist readers of the Standards in understanding where the CSA have amended the text of the Principles and their Key Considerations in drafting the Standards. An automated process was used in generating the comparison. While the CSA have used due care in preparing this document, it is possible that the comparison contains errors, omissions and inaccuracies introduced through use of the automated process. This document should therefore be used as an aid only. Readers should refer directly to the text of the Standards and the Principles and Key Considerations in order to fully understand the requirements of and differences between the two.
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Principles for financial market infrastructures Appendix A
Risk Management Standards Applicable to Recognized Clearing Agencies
PrincipleStandard 1: Legal basisAn FMI should have – A recognized clearing agency has a well-founded, clear, transparent, and enforceable legal basis for each material aspect of its activities in all relevant jurisdictions.
Key considerations
1. 1.1 The legal basis should provideprovides a high degree of certainty for each material aspect of an FMIthe clearing agency’s activities in all relevant jurisdictions.
2. An FMI should have1.2 The clearing agency has rules, procedures, and contracts that are clear, understandable, and consistent with relevant laws and regulations.
3. An FMI should be able to articulate1.3 The clearing agency articulates the legal basis for its activities to relevant authorities, participants, and, where relevant, participants’ customers, in a clear and understandable way.
4. An FMI should have1.4 The clearing agency has rules, procedures, and contracts that are enforceable in all relevant jurisdictions. There should beis a high degree of certainty that actions taken by the FMIclearing agency under suchits rules and procedures will not be voided, reversed, or subject to stays.
5. An FMI conducting1.5 If the clearing agency conducts business in multiple jurisdictions should identify, it identifies and mitigatemitigates the risks arising from any potential conflictconflicts of laws across jurisdictions.
PrincipleStandard 2: Governance An FMI should have– A recognized clearing agency has governance arrangements that are clear and transparent, promote the safety and efficiency of the FMI, andclearing agency, support the stability of the broader financial system, other relevant public interest considerations, and the objectives of relevant stakeholders.
Key considerations
1. An FMI should have 2.1 The clearing agency has objectives that place a high priority on the safety and efficiency of the FMIclearing agency and explicitly support financial stability and other relevant public interest considerations.
2. An FMI should have2.2 The clearing agency has documented governance arrangements that provide clear and direct lines of responsibility and accountability. These arrangements should beare disclosed to owners, relevant authorities, participants, and, at a more general level, the public.
3. 2.3 The roles and responsibilities of an FMIthe clearing agency’s board of directors (or equivalent) should beare clearly specified, and there should beare documented governance procedures for its functioning, including procedures to identify, address, and manage member conflicts of interest. The board should reviewof directors reviews both its overall performance and the performance of its individual board members regularly.
November 27, 2014 (2014), 37 OSCB 10508
Request for Comments
4. 2.4 The board should containof directors contains suitable members with the appropriate skills and incentives to fulfilfulfill its multiple roles. This typically requires the inclusion of non-executive board member(s).
5. 2.5 The roles and responsibilities of management should beare clearly specified. An FMIThe clearing agency’s management should havehas the appropriate experience, a mix of skills, and the integrity necessary to discharge theirits responsibilities for the operation and risk management of the FMIclearing agency.
6. 2.6 The board should establishof directors establishes a clear, documented risk-management framework that includes the FMIclearing agency’s risk-tolerance policy, assigns responsibilities and accountability for risk decisions, and addresses decision making in crises and emergencies. Governance arrangements should ensure that the risk- management and internal control functions have sufficient authority, independence, resources, and access to the board. of directors.
2.7 7. The board should ensureof directors ensures that the FMIclearing agency’s design, rules, overall strategy, and major decisions reflect appropriately the legitimate interests of its direct and indirect participants and other relevant stakeholders. Major decisions should beare clearly disclosed to relevant stakeholders and, where there is a broad market impact, the public.
PrincipleStandard 3: Framework for the comprehensive management of risksAn FMI should have – A recognized clearing agency has a sound risk-management framework for comprehensively managing legal, credit, liquidity, operational, and other risks.
Key considerations
1. An FMI should have3.1 The clearing agency has risk-management policies, procedures, and systems that enable it to identify, measure, monitor, and manage the range of risks that arise in or are borne by the FMI. Riskit. The risk-management frameworks should beframework is subject to periodic review.
2. An FMI should provide3.2 The clearing agency provides incentives to participants and, where relevant, their customers to manage and contain the risks they pose to the FMI. clearing agency.
3. An FMI should3.3 The clearing agency regularly reviewreviews the material risks it bears from and poses to other entities (such as other FMIsclearing agencies, payments systems, trade repositories, settlement banks, liquidity providers, and service providers) as a result of interdependencies and developdevelops appropriate risk-management tools to address these risks.
4. An FMI should identify3.4 The clearing agency identifies scenarios that may potentially prevent it from being able to provide its critical operations and services as a going concern and assessassesses the effectiveness of a full range of options for recovery or orderly wind-down. An FMI should prepareThe clearing agency prepares appropriate plans for its recovery or orderly wind-down based on the results of that assessment. Where applicable, an FMI shouldthe clearing agency also provideprovides relevant authorities with the information needed for purposes of resolution planning.
PrincipleStandard 4: Credit risk An FMI should– A recognized clearing agency that operates as a central counterparty or securities settlement system effectively measure, monitormeasures, monitors, and managemanages its credit exposures to participants and those arising from its payment, clearing, and settlement processes. An FMI should maintainThe clearing agency maintains sufficient financial resources to cover its credit exposure to each participant fully with a high degree of confidence. In addition, a CCPthe clearing agency, if it operates as a central counterparty, that is involved in activities with a more-complex risk profile or that is systemically important in multiple jurisdictions should maintainmaintains additional financial resources sufficient to cover a wide range of potential stress scenarios that should include, but not be limited to, the default of the two participants and their affiliates that would potentially cause the largest aggregate credit exposure to the CCPclearing agency in extreme but plausible market conditions. All other CCPs shouldclearing agencies that operate as a central counterparty maintain additional financial resources sufficient to cover a wide range of potential stress scenarios that should include, but not be limited to, the default of the participant and its affiliates that would potentially cause the largest aggregate credit exposure to the CCPclearing agency in extreme but plausible market conditions.
Key considerations
1. An FMI should establish4.1 The clearing agency establishes a robust framework to manage its credit exposures to its participants and the credit risks arising from its payment, clearing, and settlement processes. Credit exposure may arise from current exposures, potential future exposures, or both.
November 27, 2014 (2014), 37 OSCB 10509
Request for Comments
2. An FMI should identify4.2 The clearing agency identifies sources of credit risk, routinely measuremeasures and monitormonitors its credit exposures, and useuses appropriate risk-management tools to control these risks.
3. A payment system or SSS should cover4.3 The clearing agency, if it operates as a securities settlement system, covers its current exposures and, where they exist, potential future exposures to each participant fully with a high degree of confidence using collateral and other equivalent financial resources (see Principle 5 on collateral). In the case of a DNS payment system or DNS SSS. Where the clearing agency operates as a deferred net settlement system, in which there is no settlement guarantee but where its participants face credit exposures arising from its payment, clearing, and settlement processes, such an FMI should maintainthe clearing agency maintains, at a minimum, sufficient resources to cover the exposures of the two participants and their affiliates that would create the largest aggregate credit exposure in the system.
4. A CCP should cover4.4 The clearing agency that operates as a central counterparty covers its current and potential future exposures to each participant fully with a high degree of confidence using margin and other prefunded financial resources (see Principle 5 on collateral and Principle 6 on margin). In addition, a CCPthe clearing agency that operates as a central counterparty and that is involved in activities with a more-complex risk profile or that is systemically important in multiple jurisdictions should maintainmaintains additional financial resources to cover a wide range of potential stress scenarios that should include, but not be limited to, the default of the two participants and their affiliates that would potentially cause the largest aggregate credit exposure forto the CCPclearing agency in extreme but plausible market conditions. All other CCPs shouldclearing agencies that operate as a central counterparty maintain additional financial resources sufficient to cover a wide range of potential stress scenarios that should include, but not be limited to, the default of the participant and its affiliates that would potentially cause the largest aggregate credit exposure for the CCPclearing agency in extreme but plausible market conditions. In all cases, a CCP should documentthe clearing agency that operates as a central counterparty documents its supporting rationale for, and should havehas appropriate governance arrangements relating to, the amount of total financial resources it maintains.
5. A CCP should determine4.5 The clearing agency that operates as a central counterparty determines the amount and regularly testtests the sufficiency of its total financial resources available in the event of a default or multiple defaults in extreme but plausible market conditions through rigorous stress testing. A CCP should haveThe clearing agency has clear procedures to report the results of its stress tests to appropriate decision makers at the CCPclearing agency and to use these results to evaluate the adequacy of and adjust its total financial resources. Stress tests should beare performed daily using standard and predetermined parameters and assumptions. On at least a monthly basis, a CCP should performthe clearing agency performs a comprehensive and thorough analysis of stress testing scenarios, models, and underlying parameters and assumptions used to ensure they are appropriate for determining the CCPclearing agency’s required level of default protection in light of current and evolving market conditions. A CCP should performThe clearing agency performs this analysis of stress testing more frequently when the products cleared or markets served display high volatility, become less liquid, or when the size or concentration of positions held by a CCPthe clearing agency’s participants increases significantly. A full validation of a CCPthe clearing agency’s risk- management model should beis performed at least annually.
6. 4.6 In conducting stress testing, a CCP should considerthe clearing agency that operates as a central counterparty considers the effect of a wide range of relevant stress scenarios in terms of both defaulters’ positions and possible price changes in liquidation periods. Scenarios should include relevant peak historic price volatilities, shifts in other market factors such as price determinants and yield curves, multiple defaults over various time horizons, simultaneous pressures in funding and asset markets, and a spectrum of forward-looking stress scenarios in a variety of extreme but plausible market conditions.
7. An FMI should establish4.7 The clearing agency establishes explicit rules and procedures that address fully any credit losses it may face as a result of any individual or combined default among its participants with respect to any of their obligations to the FMIclearing agency. These rules and procedures should address how potentially uncovered credit losses would be allocated, including the repayment of any funds an FMIthe clearing agency may borrow from liquidity providers. These rules and procedures should also indicate the FMIclearing agency’s process to replenish any financial resources that the FMIclearing agency may employ during a stress event, so that the FMIclearing agency can continue to operate in a safe and sound manner.
PrincipleStandard 5: Collateral An FMI that– A recognized clearing agency that operates as a central counterparty or securities settlement system and requires collateral to manage its or its participants’ credit exposure should accept, accepts collateral with low credit, liquidity, and market risks. An FMI shouldThe clearing agency also setsets and enforceenforces appropriately conservative haircuts and concentration limits.
November 27, 2014 (2014), 37 OSCB 10510
Request for Comments
Key considerations
1. An FMI should5.1 The clearing agency generally limitlimits the assets it (routinely) accepts as collateral to those with low credit, liquidity, and market risks.
2. An FMI should establish5.2 The clearing agency establishes prudent valuation practices and developdevelops haircuts that are regularly tested and take into account stressed market conditions.
3. 5.3 In order to reduce the need for procyclical adjustments, an FMI should establishthe clearing agency establishes stable and conservative haircuts that are calibrated to include periods of stressed market conditions, to the extent practicable and prudent.
4. An FMI should avoid5.4 The clearing agency avoids concentrated holdings of certain assets where this would significantly impair the ability to liquidate such assets quickly without significant adverse price effects.
5. An FMI that5.5 Where the clearing agency accepts cross-border collateral should mitigate, it mitigates the risks associated with its use and ensureensures that the collateral can be used in a timely manner.
6. An FMI should use5.6 The clearing agency uses a collateral management system that is well-designed and operationally flexible.
PrincipleStandard 6: Margin A CCP should cover– A recognized clearing agency that operates as a central counterparty covers its credit exposures to its participants for all products through an effective margin system that is risk-based and regularly reviewed.
Key considerations
1. A CCP should have6.1 The clearing agency has a margin system that establishes margin levels commensurate with the risks and particular attributes of each product, portfolio, and market it serves.
2. A CCP should have6.2 The clearing agency has a reliable source of timely price data for its margin system. A CCP shouldThe clearing agency also havehas procedures and sound valuation models for addressing circumstances in which pricing data are not readily available or reliable.
3. A CCP should adopt6.3 The clearing agency adopts initial margin models and parameters that are risk-based and generate margin requirements sufficient to cover its potential future exposure to participants in the interval between the last margin collection and the close out of positions following a participant default. Initial margin should meetmeets an established single-tailed confidence level of at least 99 percent with respect to the estimated distribution of future exposure. For a CCPclearing agency that calculates margin at the portfolio level, this requirement applies to each portfolio’s distribution of future exposure. For a CCPclearing agency that calculates margin at more-granular levels, such as at the subportfolio level or by product, the requirement must beis met for the corresponding distributions of future exposure. The model should (a) useuses a conservative estimate of the time horizons for the effective hedging or close out of the particular types of products cleared by the CCPclearing agency (including in stressed market conditions), (b) havehas an appropriate method for measuring credit exposure that accounts for relevant product risk factors and portfolio effects across products, and (c) to the extent practicable and prudent, limitlimits the need for destabilising, procyclical changes.
4. A CCP should mark6.4 The clearing agency marks participant positions to market and collectcollects variation margin at least daily to limit the build-up of current exposures. A CCP should haveThe clearing agency has the authority and operational capacity to make intraday margin calls and payments, both scheduled and unscheduled, to participants.
6.5 5. In calculating margin requirements, a CCPthe clearing agency may allow offsets or reductions in required margin across products that it clears or between products that it and another CCPcentral counterparty clear, if the risk of one product is significantly and reliably correlated with the risk of the other product. Where two or more CCPs are authorisedthe clearing agency is authorized to offer cross-margining, they must with one or more other central counterparties, it and the other central counterparties have appropriate safeguards and harmonised overall risk- management systems.
6. A CCP should analyse6.6 The clearing agency analyses and monitormonitors its model performance and overall margin coverage by conducting rigorous daily backtesting and at least monthly, and more-frequent frequently where appropriate, sensitivity analysis. A CCP shouldThe clearing agency regularly conductconducts an assessment of the theoretical and empirical properties of its margin model for all products it clears. In conducting sensitivity analysis of
November 27, 2014 (2014), 37 OSCB 10511
Request for Comments
the model’s coverage, a CCP should takethe clearing agency takes into account a wide range of parameters and assumptions that reflect possible market conditions, including the most volatile periods that have been experienced by the markets it serves and extreme changes in the correlations between prices.
7. A CCP should6.7 The clearing agency regularly reviewreviews and validatevalidates its margin system.
PrincipleStandard 7: Liquidity riskAn FMI should effectively measure, monitor – A recognized clearing agency that operates as a central counterparty or securities settlement system effectively measures, monitors, and managemanages its liquidity risk. An FMI should maintainThe clearing agency maintains sufficient liquid resources in all relevant currencies to effect same-day and, where appropriate, intraday and multiday settlement of payment obligations with a high degree of confidence under a wide range of potential stress scenarios that should include, but not be limited to, the default of the participant and its affiliates that would generate the largest aggregate liquidity obligation for the FMIclearing agency in extreme but plausible market conditions.
Key considerations
1. An FMI should have7.1 The clearing agency has a robust framework to manage its liquidity risks from its participants, settlement banks, nostro agents, custodian banks, liquidity providers, and other entities.
2. An FMI should have7.2 The clearing agency has effective operational and analytical tools to identify, measure, and monitor its settlement and funding flows on an ongoing and timely basis, including its use of intraday liquidity.
3. A payment7.3 The clearing agency that performs the services of a securities settlement system or SSS, including one employing a DNSthat employs a deferred net settlement mechanism, should maintainmaintains sufficient liquid resources in all relevant currencies to effect same-day settlement, and where appropriate intraday or multiday settlement, of payment obligations with a high degree of confidence under a wide range of potential stress scenarios that should include, but not be limited to, the default of the participant and its affiliates that would generate the largest aggregate payment obligation in extreme but plausible market conditions.
4. A CCP should maintain7.4 The clearing agency that operates as a central counterparty maintains sufficient liquid resources in all relevant currencies to settle securities-related payments, make required variation margin payments, and meet other payment obligations on time with a high degree of confidence under a wide range of potential stress scenarios that should include, but not be limited to, the default of the participant and its affiliates that would generate the largest aggregate payment obligation to the CCPclearing agency in extreme but plausible market conditions. In addition, a CCPthe clearing agency that operates as a central counterparty, and that is involved in activities with a more-complex risk profile or that is systemically important in multiple jurisdictions should consider, considers maintaining additional liquidity resources sufficient to cover a wider range of potential stress scenarios that should include, but not be limited to, the default of the two participants and their affiliates that would generate the largest aggregate payment obligation to the CCPclearing agency in extreme but plausible market conditions.
7.5 5. For the purpose of meeting its minimum liquid resource requirement, an FMIthe clearing agency’s qualifying liquid resources in each currency include cash at the central bank of issue andor at creditworthy commercial banks, committed lines of credit, committed foreign exchange swaps, and committed reposrepurchase agreements, as well as highly marketable collateral held in custody and investments that are readily available and convertible into cash with prearranged and highly reliable funding arrangements, even in extreme but plausible market conditions. If an FMIthe clearing agency has access to routine credit at the central bank of issue, the FMIclearing agency may count such access as part of the minimum requirement to the extent it has collateral that is eligible for pledging to, (or for conducting other appropriate forms of transactions with), the relevant central bank. All such resources should beare available when needed.
6. An FMI7.6 The clearing agency may supplement its qualifying liquid resources with other forms of liquid resources. If the FMIclearing agency does so, then these liquid resources should beare in the form of assets that are likely to be saleable or acceptable as collateral for lines of credit, swaps, or reposrepurchase agreements on an ad hoc basis following a default, even if this cannot be reliably prearranged or guaranteed in extreme market conditions. Even if an FMIthe clearing agency does not have access to routine central bank credit, it should still taketakes account of what collateral is typically accepted by the relevant central bank, as such assets may be more likely to be liquid in stressed circumstances. An FMI shouldThe clearing agency does not assume the availability of emergency central bank credit as a part of its liquidity plan.
7. An FMI should obtain7.7 The clearing agency obtains a high degree of confidence, through rigorous due diligence, that each provider of its minimum required qualifying liquid resources, whether a participant of the FMIclearing agency or an external party, has sufficient information to understand and to manage its associated liquidity risks, and that it has the capacity to perform as required under its commitment. Where relevant to assessing a liquidity provider’s performance reliability with respect to a particular currency, a liquidity provider’s potential access to credit
November 27, 2014 (2014), 37 OSCB 10512
Request for Comments
from the central bank of issue may be taken into account. An FMI shouldThe clearing agency regularly testtests its procedures for accessing its liquid resources at a liquidity provider.
8. An FMI7.8 The clearing agency with access to central bank accounts, payment services, or securities services should useuses these services, where practical, to enhance its management of liquidity risk.
9. An FMI should determine7.9 The clearing agency determines the amount and regularly testtests the sufficiency of its liquid resources through rigorous stress testing. An FMI should haveThe clearing agency has clear procedures to report the results of its stress tests to appropriate decision makers at the FMIclearing agency and to use these results to evaluate the adequacy of and adjust its liquidity risk-management framework. In conducting stress testing, an FMI should considerthe clearing agency considers a wide range of relevant scenarios. Scenarios should include relevant peak historic price volatilities, shifts in other market factors such as price determinants and yield curves, multiple defaults over various time horizons, simultaneous pressures in funding and asset markets, and a spectrum of forward-looking stress scenarios in a variety of extreme but plausible market conditions. Scenarios should also take into account the design and operation of the FMIclearing agency, include all entities that mightmay pose material liquidity risks to the FMIclearing agency (such as settlement banks, nostro agents, custodian banks, liquidity providers, and linked FMIsclearing agencies, trade repositories and payment systems), and where appropriate, cover a multiday period. In all cases, an FMI should documentthe clearing agency documents its supporting rationale for, and should havehas appropriate governance arrangements relating to, the amount and form of total liquid resources it maintains.
10. An FMI should establish7.10 The clearing agency establishes explicit rules and procedures that enable the FMIclearing agency to effect same-day and, where appropriate, intraday and multiday settlement of payment obligations on time following any individual or combined default among its participants. These rules and procedures should address unforeseen and potentially uncovered liquidity shortfalls and shouldwhich aim to avoid unwinding, revoking, or delaying the same-day settlement of payment obligations. These rules and procedures should also indicate the FMIclearing agency’s process to replenish any liquidity resources it may employ during a stress event, so that it can continue to operate in a safe and sound manner.
PrincipleStandard 8: Settlement finalityAn FMI should provide – A recognized clearing agency that operates as a central counterparty or securities settlement system provides clear and certain final settlement, at a minimum by the end of the value date. Where necessary or preferable, an FMI should providethe clearing agency provides final settlement intraday or in real time.
Key considerations
1. An FMI8.1 The clearing agency’s rules and procedures should clearly define the point at which settlement is final.
2. An FMI should complete8.2 The clearing agency completes final settlement no later than the end of the value date, and preferably intraday or in real time, to reduce settlement risk. An LVPS or SSS should consider adopting RTGSThe clearing agency that operates as a securities settlement system generally considers adopting real-time gross settlement or multiple-batch processing during the settlement day.
3. An FMI should8.3 The clearing agency clearly definedefines the point after which unsettled payments, transfer instructions, or other obligations may not be revoked by a participant.
PrincipleStandard 9: Money settlementsAn FMI should conduct – A recognized clearing agency that operates as a central counterparty or securities settlement system conducts its money settlements in central bank money, where practical and available. If central bank money is not used, an FMI should minimisethe clearing agency minimizes and strictly controlcontrols the credit and liquidity risk arising from the use of commercial bank money.
Key considerations
1. An FMI should conduct9.1 The clearing agency conducts its money settlements in central bank money, where practical and available, to avoid credit and liquidity risks.
9.2 2. If central bank money is not used, an FMI should conductthe clearing agency conducts its money settlements using a settlement asset with little or no credit or liquidity risk.
3. 9.3 If an FMIthe clearing agency settles in commercial bank money, it should monitor, managemonitors, manages, and limitlimits its credit and liquidity risks arising from the commercial settlement banks. In particular, an FMI should establish and monitorthe clearing agency establishes and monitors adherence to strict criteria for its settlement banks
November 27, 2014 (2014), 37 OSCB 10513
Request for Comments
that take account of, among other things, their regulation and supervision, creditworthiness, capitalisation, access to liquidity, and operational reliability. An FMI shouldThe clearing agency also monitormonitors and managemanages the concentration of credit and liquidity exposures to its commercial settlement banks.
4. 9.4 If an FMIthe clearing agency conducts money settlements on its own books, it should minimiseminimizes and strictly controlcontrols its credit and liquidity risks.
5. An FMI9.5 The clearing agency’s legal agreements with any settlement banks should state clearly when transfers on the books of individual settlement banks are expected to occur, that transfers are to be final when effected, and that funds received shouldare to be transferable as soon as possible, at a minimum by the end of the day and ideally intraday, in order to enable the FMIclearing agency and its participants to manage credit and liquidity risks.
PrincipleStandard 10: Physical deliveriesAn FMI should – A recognized clearing agency clearly statestates its obligations with respect to the delivery of physical instruments or commodities and should identify, monitor, and manageidentifies, monitors and manages the risks associated with such physical deliveries.
Key considerations
1. An FMI10.1 The clearing agency’s rules should clearly state its obligations with respect to the delivery of physical instruments or commodities.
2. An FMI should identify, monitor,10.2 The clearing agency identifies, monitors and managemanages the risks and costs associated with the storage and delivery of physical instruments orand commodities.
PrincipleStandard 11: Central securities depositoriesA CSD should have – A recognized clearing agency that operates as a central securities depository has appropriate rules and procedures to help ensure the integrity of securities issues and minimiseminimizes and managemanages the risks associated with the safekeeping and transfer of securities. A CSD should maintainThe clearing agency maintains securities in an immobilised or dematerialisedimmobilized or dematerialized form for their transfer by book entry.
Key considerations
1. A CSD should have11.1 The clearing agency has appropriate rules, procedures, and controls, including robust accounting practices, to safeguard the rights of securities issuers and holders, prevent the unauthorised creation or deletion of securities, and conduct periodic and at least daily reconciliation of securities issues it maintains.
2. A CSD should prohibit11.2 The clearing agency prohibits overdrafts and debit balances in securities accounts.
3. A CSD should maintain11.3 The clearing agency maintains securities in an immobilisedimmobilized or dematerialised form for their transfer by book entry. Where appropriate, a CSD should providethe clearing agency provides incentives to immobiliseimmobilize or dematerialise securities.
4. A CSD should protect11.4 The clearing agency protects assets against custody risk through appropriate rules and procedures consistent with its legal framework.
5. A CSD should employ11.5 The clearing agency employs a robust system that ensures segregation between the CSD’sits own assets and the securities of its participants and segregation among the securities of participants. Where supported by the legal framework, the CSD shouldclearing agency also supportsupports operationally the segregation of securities belonging to a participant’s customers on the participant’s books and facilitatefacilitates the transfer of customer holdings.
6. A CSD should identify, measure, monitor11.6 The clearing agency identifies, measures, monitors, and managemanages its risks from other activities that it may perform; additional tools may be necessary in order to address these risks.
PrincipleStandard 12: Exchange-of-value settlement systemsIf an FMI – Where a recognized clearing agency operates as a central counterparty or securities settlement system and settles transactions that involve the settlement of two linked obligations (for example, securities or foreign exchange transactions), it should eliminateeliminates principal risk by conditioning the final settlement of one obligation upon the final settlement of the other.
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Request for Comments
Key consideration
1. An FMI12.1 The clearing agency that is an exchange-of-value settlement system should eliminateeliminates principal risk by ensuring that the final settlement of one obligation occurs if and only if the final settlement of the linked obligation also occurs, regardless of whether the FMIclearing agency settles on a gross or net basis and when finality occurs.
PrincipleStandard 13: Participant- default rules and proceduresAn FMI should have – A recognized clearing agency has effective and clearly defined rules and procedures to manage a participant default. These rules and procedures should beare designed to ensure that the FMIclearing agency can take timely action to contain losses and liquidity pressures and continue to meet its obligations.
Key considerations
1. An FMI should have13.1 The clearing agency has default rules and procedures that enable the FMIclearing agency to continue to meet its obligations in the event of a participant default and that address the replenishment of resources following a default.
2. An FMI should be13.2 The clearing agency is well prepared to implement its default rules and procedures, including any appropriate discretionary procedures provided for in its rules.
3. An FMI should13.3 The clearing agency publicly disclosediscloses key aspects of its default rules and procedures.
4. An FMI should involve13.4 The clearing agency involves its participants and other stakeholders in the testing and review of the FMIclearing agency’s default procedures, including any close-out procedures. Such testing and review should beis conducted at least annually or following material changes to the clearing agency’s rules and procedures to ensure that they are practical and effective.
PrincipleStandard 14: Segregation and portabilityA CCP should have – A recognized clearing agency that operates as a central counterparty has rules and procedures that enable the segregation and portability of positions of a participant’s customers and the collateral provided to the CCPclearing agency with respect to those positions.
Key considerations
1. A CCP should14.1 The clearing agency has, at a minimum, have segregation and portability arrangements that effectively protect a participant’s customers’ positions and related collateral from the default or insolvency of that participant. If the CCPclearing agency additionally offers protection of such customer positions and collateral against the concurrent default of the participant and a fellow customer, the CCP should takeclearing agency takes steps to ensure that such protection is effective.
2. A CCP should employ14.2 The clearing agency employs an account structure that enables it readily to identify positions of a participant’s customers and to segregate related collateral. A CCP should maintainThe clearing agency maintains customer positions and collateral in individual customer accounts or in omnibus customer accounts.
3. A CCP should structure14.3 The clearing agency structures its portability arrangements in a way that makes it highly likely that the positions and collateral of a defaulting participant’s customers will be transferred to one or more other participants.
4. A CCP should disclose14.4 The clearing agency discloses its rules, policies, and procedures relating to the segregation and portability of a participant’s customers’ positions and related collateral. In particular, the CCP should discloseclearing agency discloses whether customer collateral is protected on an individual or omnibus basis. In addition, a CCP should disclose the clearing agency discloses any constraints, such as legal or operational constraints, that may impair its ability to segregate or port athe participant’s customers’ positions and related collateral.
PrincipleStandard 15: General business riskAn FMI should identify, monitor – A recognized clearing agency identifies, monitors, and managemanages its general business risk and holdholds sufficient liquid net assets funded by equity to cover potential general business losses so that it can continue operations and services as a going concern if those losses materialise. Further, liquid net assets shouldare at all times be sufficient to ensure a recovery or orderly wind-down of critical operations and services.
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Request for Comments
Key considerations
1. An FMI should have15.1 The clearing agency has robust management and control systems to identify, monitor, and manage general business risks, including losses from poor execution of business strategy, negative cash flows, or unexpected and excessively large operating expenses.
2. An FMI should hold15.2 The clearing agency holds liquid net assets funded by equity (such as common stock, disclosed reserves, or other retained earnings) so that it can continue operations and services as a going concern if it incurs general business losses. The amount of liquid net assets funded by equity an FMI should hold should bethe clearing agency holds is determined by its general business risk profile and the length of time required to achieve a recovery or orderly wind-down, as appropriate, of its critical operations and services if such action is taken.
3. An FMI should maintain15.3 The clearing agency maintains a viable recovery or orderly wind-down plan and should holdholds sufficient liquid net assets funded by equity to implement this plan. At a minimum, an FMI should holdthe clearing agency holds liquid net assets funded by equity equal to at least six months of current operating expenses. These assets are in addition to resources held to cover participant defaults orand other risks required to be covered under the financial resources principlesStandards. However, equity held under international risk-based capital standards can be included where relevant and appropriate to avoid duplicate capital requirements.
4. 15.4 Assets held to cover general business risk should beare of high quality and sufficiently liquid in order to allow the FMIclearing agency to meet its current and projected operating expenses under a range of scenarios, including in adverse market conditions.
5. An FMI should maintain15.5 The clearing agency maintains a viable plan for raising additional equity should its equity fall close to or below the amount needed. This plan should beis approved by the board of directors and updated regularly.
PrincipleStandard 16: Custody and investment risksAn FMI should safeguard – A recognized clearing agency safeguards its own and its participants’ assets and minimiseminimizes the risk of loss on and delay in access to these assets. An FMIThe clearing agency’s investments should beare in instruments with minimal credit, market, and liquidity risks.
Key considerations
1. An FMI should hold16.1 The clearing agency holds its own and its participants’ assets at supervised and regulated entities that have robust accounting practices, safekeeping procedures, and internal controls that fully protect thesesuch assets.
2. An FMI should have16.2 The clearing agency has prompt access to its assets and the assets provided by participants, when required.
3. An FMI should evaluate and understand16.3 The clearing agency evaluates and understands its exposures to its custodian banks, taking into account the full scope of its relationships with each.
4. An FMI16.4 The clearing agency’s investment strategy should beis consistent with its overall risk- management strategy and fully disclosed to its participants, and investments should beare secured by, or be claims on, high-quality obligors. These investments should allow for quick liquidation with little, if any, adverse price effect.
PrincipleStandard 17: Operational riskAn FMI should identifyrisks – A recognized clearing agency identifies the plausible sources of operational risk, both internal and external, and mitigatemitigates their impact through the use of appropriate systems, policies, procedures, and controls. Systems should beare designed to ensure a high degree of security and operational reliability and should have adequate, scalable capacity. Business continuity management should aimaims for timely recovery of operations and fulfilmentfulfillment of the FMIclearing agency’s obligations, including in the event of a wide-scale or major disruption.
Key considerations
1. An FMI should establish17.1 The clearing agency establishes a robust operational risk-management framework with appropriate systems, policies, procedures, and controls to identify, monitor, and manage operational risks.
2. An FMI17.2 The clearing agency’s board of directors should clearly definedefines the roles and responsibilities for addressing operational risk and should endorseendorses the FMIclearing agency’s operational risk-management
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Request for Comments
framework. Systems, operational policies, procedures, and controls should beare reviewed, audited, and tested periodically and after significant changes.
3. An FMI should have17.3 The clearing agency has clearly defined operational reliability objectives and should havehas policies in place that are designed to achieve those objectives.
4. An FMI should ensure17.4 The clearing agency ensures that it has scalable capacity adequate to handle increasing stress volumes and to achieve its service-level objectives.
5. An FMI should have17.5 The clearing agency has comprehensive physical and information security policies that address all potential vulnerabilities and threats.
6. An FMI should have17.6 The clearing agency has a business continuity plan that addresses events posing a significant risk of disrupting operations, including events that could cause a wide-scale or major disruption. The plan should incorporateincorporates the use of a secondary site and should beis designed to ensure that critical information technology (IT) systems can resume operations within two hours following disruptive events. The plan should beis designed to enable the FMIclearing agency to complete settlement by the end of the day of the disruption, even in case of extreme circumstances. The FMI shouldclearing agency regularly testtests these arrangements.
7. An FMI should identify, monitor17.7 The clearing agency identifies, monitors, and managemanages the risks that key participants, other FMIsclearing agencies, trade repositories, payment systems, and service and utility providers might pose to its operations. In addition, an FMI should identify, monitor, and managethe clearing agency identifies, monitors, and manages the risks its operations might pose to other FMIsclearing agencies, trade repositories, and payment systems.
PrincipleStandard 18: Access and participation requirements An FMI should have– A recognized clearing agency has objective, risk-based, and publicly disclosed criteria for participation, which permit fair and open access.
Key considerations
1. An FMI should allow 18.1 The clearing agency allows for fair and open access to its services, including by direct and, where relevant, indirect participants and other FMIsclearing agencies, payment systems and trade repositories, based on reasonable risk-related participation requirements.
2. An FMI18.2 The clearing agency’s participation requirements should beare justified in terms of the safety and efficiency of the FMIclearing agency and the markets it serves, beare tailored to and commensurate with the FMIclearing agency’s specific risks, and beare publicly disclosed. Subject to maintaining acceptable risk control standards, an FMI should endeavourthe clearing agency endeavours to set requirements that have the least-restrictive impact on access that circumstances permit.
3. An FMI should monitor18.3 The clearing agency monitors compliance with its participation requirements on an ongoing basis and havehas clearly defined and publicly disclosed procedures for facilitating the suspension and orderly exit of a participant that breaches, or no longer meets, the participation requirements.
PrincipleStandard 19: Tiered participation arrangementsAn FMI should identify, monitor – A recognized clearing agency identifies, monitors, and managemanages the material risks to the FMIclearing agency arising from any tiered participation arrangements.
Key considerations
1. An FMI should ensure19.1 The clearing agency ensures that its rules, procedures, and agreements allow it to gather basic information about indirect participation in order to identify, monitor, and manage any material risks to the FMIclearing agency arising from such tiered participation arrangements.
2. An FMI should identify19.2 The clearing agency identifies material dependencies between direct and indirect participants that might affect the FMI. clearing agency.
3. An FMI should identify19.3 The clearing agency identifies indirect participants responsible for a significant proportion of transactions processed by the FMIclearing agency and indirect participants whose transaction volumes or values are large relative to the capacity of the direct participants through which they access the FMIclearing agency in order to manage the risks arising from these transactions. 4. An FMI should19.4 The clearing agency regularly reviewreviews risks arising from tiered participation arrangements and should taketakes mitigating action when appropriate.
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Request for Comments
Principle 20: FMI links An FMIStandard 20: Links with other financial market infrastructures – A recognized clearing agency that establishes a link with one or more FMIs should identify, monitor, and manageclearing agencies or trade repositories identifies, monitors, and manages link-related risks.
Key considerations
1. 20.1 Before entering into a link arrangement and on an ongoing basis once the link is established, an FMI should identify, monitor, and managethe clearing agency identifies, monitors, and manages all potential sources of risk arising from the link arrangement. Link arrangements should be. Links are designed such that each FMIthe clearing agency is able to observe the other principles in this reportStandards.
2. 20.2 A link should havehas a well-founded legal basis, in all relevant jurisdictions, that supports its design and provides adequate protection to the FMIsclearing agencies and trade repositories involved in the link.
20.3 3. Linked CSDs shouldcentral securities depositories measure, monitor, and manage the credit and liquidity risks arising from each other. Any credit extensions between CSDs should becentral securities depositories are covered fully with high-quality collateral and beare subject to limits. 4.
20.4 Provisional transfers of securities between linked CSDs should becentral securities depositories are prohibited or, at a minimum, the retransfer of provisionally transferred securities should beare prohibited prior to the transfer becoming final.
5. 20.5 An investor CSD shouldcentral securities depository only establishestablishes a link with an issuer CSDcentral securities depository if the arrangementlink provides a high level of protection for the rights of the investor CSDcentral securities depository’s participants.
20.6 6. An investor CSDcentral securities depository that uses an intermediary to operate a link with an issuer CSD should measure, monitor, and managecentral securities depository measures, monitors, and manages the additional risks (including custody, credit, legal, and operational risks) arising from the use of the intermediary.
7. 20.7 Before entering into a link with another CCP, a CCP should identify and managecentral counterparty, a central counterparty identifies and manages the potential spill-over effects from the default of the linked CCPcentral counterparty. If a link has three or more CCPs, each CCP should identify, assess, and managecentral counterparties, each central counterparty identifies, assesses, and manages the risks of the collective link arrangement.
8. 20.8 Each CCPcentral counterparty in a CCPcentral counterparty link arrangement should beis able to cover, at least on a daily basis, its current and potential future exposures to the linked CCPcentral counterparty and its participants, if any, fully with a high degree of confidence without reducing the CCPcentral counterparty’s ability to fulfilfulfill its obligations to its own participants at any time.
9. A TR should carefully assess the additional operational risks related to its links to ensure the scalability and reliability of IT and related resources.
PrincipleStandard 21: Efficiency and effectivenessAn FMI should be – A recognized clearing agency is efficient and effective in meeting the requirements of its participants and the markets it serves.
Key considerations
1. An FMI should be21.1 The clearing agency is designed to meet the needs of its participants and the markets it serves, in particular, with regard to choice of a clearing and settlement arrangement; operating structure; scope of products cleared, settled, or recorded; and use of technology and procedures.
2. An FMI should have21.2 The clearing agency has clearly defined goals and objectives that are measurable and achievable, such as in the areas of minimum service levels, risk-management expectations, and business priorities.
3. An FMI should have21.3 The clearing agency has established mechanisms for the regular review of its efficiency and effectiveness.
PrincipleStandard 22: Communication procedures and standardsAn FMI should use – A recognized clearing agency uses, or at a minimum accommodateaccommodates, relevant internationally accepted communication procedures and standards in order to facilitate efficient payment, clearing, settlement, depository, and recording.
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Request for Comments
Key consideration
1. An FMI should use22.1 The clearing agency uses, or at a minimum accommodateaccommodates, internationally accepted communication procedures and standards.
Principle Standard 23: Disclosure of rules, key procedures, and market dataAn FMI should have – A recognized clearing agency has clear and comprehensive rules and procedures and should provideprovides sufficient information to enable participants to have an accurate understanding of the risks, fees, and other material costs they incur by participating in the FMIclearing agency. All relevant rules and key procedures should beare publicly disclosed.
Key considerations
1. An FMI should adopt23.1 The clearing agency adopts clear and comprehensive rules and procedures that are fully disclosed to participants. Relevant rules and key procedures shouldare also be publicly disclosed.
2. An FMI should disclose23.2 The clearing agency discloses clear descriptions of the system’sclearing agency’s systems’ design and operations, as well as the FMI’s and participants’ rights and obligations of the clearing agency and its participants, so that participants can assess the risks they would incur by participating in the FMI. clearing agency.
3. An FMI should provide23.3 The clearing agency provides all necessary and appropriate documentation and training to facilitate participants’ understanding of the FMIclearing agency’s rules and procedures and the risks they face from participating in the FMIclearing agency.
4. An FMI should23.4 The clearing agency publicly disclosediscloses its fees at the level of individual services it offers as well as its policies on any available discounts. The FMI should provideclearing agency provides clear descriptions of priced services for comparability purposes.
5. An FMI should complete23.5 The clearing agency completes regularly and disclosediscloses publicly responses to the CPSS-IOSCOPFMI Disclosure framework for financial market infrastructures. An FMI also shouldFramework Document. The clearing agency also, at a minimum, disclosediscloses basic data on transaction volumes and values.
November 27, 2014 (2014), 37 OSCB 10519
Request for Comments
APPENDIX “C”
TEXTS OF PROPOSED NATIONAL INSTRUMENT 24-102 CLEARING AGENCY REQUIREMENTS (INCLUDING RELATED FORMS 24-102 F1 AND F2) AND COMPANION POLICY 24-102CP TO NATIONAL INSTRUMENT 24-102 CLEARING AGENCY REQUIREMENTS
NATIONAL INSTRUMENT 24-102 CLEARING AGENCY REQUIREMENTS
TABLE OF CONTENTS
PART 1 DEFINITIONS, INTERPRETATION AND APPLICATION
PART 2 CLEARING AGENCY RECOGNITION OR EXEMPTION FROM RECOGNITION
PART 3 INTERNATIONAL STANDARDS APPLICABLE TO RECOGNIZED CLEARING AGENCIES
PART 4 OTHER REQUIREMENTS OF RECOGNIZED CLEARING AGENCIES Division 1 – Governance Division 2 – Default management Division 3 – Operational risk Division 4 – Participation requirements
PART 5 BOOKS AND RECORDS AND LEGAL ENTITY IDENTIFIER
PART 6 EXEMPTION
PART 7 EFFECTIVE DATES AND TRANSITION
APPENDIX A INTERNATIONAL RISK MANAGEMENT STANDARDS APPLICABLE TO RECOGNIZED CLEARING AGENCIES Standard 1: Legal basis Standard 2: Governance Standard 3: Framework for the comprehensive management of risks Standard 4: Credit risk Standard 5: Collateral Standard 6: Margin Standard 7: Liquidity risk Standard 8: Settlement finality Standard 9: Money settlements Standard 10: Physical deliveries Standard 11: Central securities depositories Standard 12: Exchange-of-value settlement systems Standard 13: Participant default rules and procedures Standard 14: Segregation and portability Standard 15: General business risk Standard 16: Custody and investment risks Standard 17: Operational risks Standard 18: Access and participation requirements Standard 19: Tiered participation arrangements Standard 20: Links with other financial market infrastructures Standard 21: Efficiency and effectiveness Standard 22: Communication procedures and standards Standard 23: Disclosure of rules, key procedures, and market data
FORMS Form 24-102F1 – Clearing Agency Submission to Jurisdiction and Appointment of Agent for Service of Process Form 24-102F2 – Cessation of Operations Report for Clearing Agency
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Request for Comments
PART 1 DEFINITIONS, INTERPRETATION AND APPLICATION
Definitions
1.1 In this Instrument, including Appendix A to this Instrument,
“board of directors” means, in the case of a recognized clearing agency that does not have a board of directors, a group of individuals that acts for the clearing agency in a capacity similar to a board of directors;
“clearing agency” includes, in Quebec, a clearing house, central securities depository and settlement system within the meaning of the Quebec Securities Act and a derivatives clearing house and settlement system within the meaning of the Quebec Derivatives Act;
“central counterparty” means a person or company that interposes itself between the counterparties to securities or derivatives transactions in one or more financial markets, acting functionally as the buyer to every seller and the seller to every buyer or the counterparty to every party;
“central securities depository” means a person or company that provides centralized facilities as a depository of securities, including securities accounts, central safekeeping services, and asset services, which may include the administration of corporate actions and redemptions;
“executive officer” has the meaning ascribed to it in National Instrument 52-110 – Audit Committee;
“exempt clearing agency” means a clearing agency that has been granted a decision of the securities regulatory authority pursuant to securities legislation exempting it from the requirement in such legislation to be recognized by the securities regulatory authority as a clearing agency;
“immediate family member” has the meaning ascribed to it in National Instrument 52-110 – Audit Committee;
“initial margin”, in relation to a clearing agency’s margin system to manage credit exposures to its participants, means collateral that is required by the clearing agency to cover potential changes in the value of each participant’s position (that is, potential future exposure) over an appropriate close-out period in the event the participant defaults;
“link” means, in relation to a clearing agency, a set of contractual and operational arrangements that directly or indirectly through an intermediary connects the clearing agency and one or more other systems or arrangements for the clearing, settlement or recording of securities or derivatives transactions;
“participant” means a person or company that has entered into an agreement with a clearing agency to access the services of the clearing agency and is bound by the clearing agency’s rules and procedures;
“PFMI Disclosure Framework Document” means a disclosure document completed substantially in the form of Annex A: FMI disclosure template of the December 2012 report Principles for financial market infrastructures: Disclosure framework and Assessment methodology published by the Committee on Payment and Settlement Systems and the International Organization of Securities Commissions, as amended, supplemented or superseded from time to time or a similar disclosure document required to be completed regularly and disclosed publicly by a clearing agency in accordance with the regulatory requirements of a foreign jurisdiction in which the clearing agency is located;
“product”, when used in relation to a clearing agency’s depository, clearance or settlement services, means a security or derivative, or class of securities or derivatives, or, where the context so requires, a trade or other transaction in or related to a security or derivative, or class of securities or derivatives, that is eligible for such services;
“securities settlement system” means a system that enables securities to be transferred and settled by book entry according to a set of predetermined multilateral rules;
“Standard” means a standard set out in Appendix A to this Instrument that is based on international standards governing financial market infrastructures developed by the Committee on Payment and Settlement Systems and the International Organization of Securities Commissions;
“stress test” or “stress testing” means, except in section 4.13, a test conducted periodically by a clearing agency that operates as a central counterparty or securities settlement system to estimate credit and liquidity exposures that would result from the realization of extreme price changes to determine the amount and sufficiency of the clearing agency’s total financial resources available in the event of a default or multiple defaults in extreme but plausible market conditions;
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Request for Comments
“variation margin”, in relation to the margin system of a clearing agency that operates as a central counterparty to manage credit exposures to its participants for all products it clears, means funds that are collected and paid out on a regular and ad hoc basis by the clearing agency to reflect current exposures resulting from actual changes in market prices.
Interpretation – Meaning of Accounting Terms
1.2 In this Instrument, each of the following terms has the same meaning as in National Instrument 52-107 Acceptable Accounting Principles and Auditing Standards: “accounting principles”, “auditing standards”, and “publicly accountable enterprises”.
Interpretation – Affiliated Entity, Controlled Entity and Subsidiary Entity
1.3 (1) In this Instrument, a person or company is considered to be an affiliated entity of another person or company if one is a subsidiary entity of the other or if both are subsidiary entities of the same person or company, or if each of them is a controlled entity of the same person or company.
(2) In this Instrument, a person or company is considered to be controlled by a person or company if
(a) in the case of a person or company,
(i) voting securities of the first-mentioned person or company carrying more than fifty percent of the votes for the election of directors are held, otherwise than by way of security only, by or for the benefit of the other person or company, and
(ii) the votes carried by the securities are entitled, if exercised, to elect a majority of the directors of the first-mentioned person or company;
(b) in the case of a partnership that does not have directors, other than a limited partnership, the second- mentioned person or company holds more than fifty percent of the interests in the partnership; or
(c) in the case of a limited partnership, the general partner is the second-mentioned person or company.
(3) In this Instrument, a person or company is considered to be a subsidiary entity of another person or company if
(a) it is a controlled entity of,
(i) that other,
(ii) that other and one or more persons or companies each of which is a controlled entity of that other, or
(iii) two or more persons or companies, each of which is a controlled entity of that other; or
(b) it is a subsidiary entity of a person or company that is the other's subsidiary entity.
Interpretation – Extended Meaning of Affiliate
1.4 For the purposes of Standards 4, 5, 6 and 7 in Appendix A to this Instrument, a person or company is also considered to be an affiliate of a participant (in this section, the person or company and the participant each described as a “party”) where,
(a) a party holds directly or indirectly, otherwise than by way of security only, voting securities of the other party carrying at least 20 percent of the votes for the election of directors; or
(b) in the event paragraph (a) is not applicable,
(i) a party holds directly or indirectly, otherwise than by way of security only, an interest in the other party that allows it to direct the management or operations of the other party; or
(ii) financial information in respect of both parties is consolidated for financial reporting purposes.
November 27, 2014 (2014), 37 OSCB 10522
Request for Comments
Application
1.5 (1) Part 3 applies to a recognized clearing agency that operates as any of the following:
(a) a central counterparty;
(b) a central securities depository; or
(c) a securities settlement system.
(2) Unless the context otherwise indicates, Part 4 applies to a recognized clearing agency whether or not it operates as a central counterparty, central securities depository or securities settlement system.
(3) In Quebec, if there is a conflict or an inconsistency between section 2.2 for implementing a material change and the provisions of the Quebec Derivatives Act governing the self-certification process,, the provisions of the Quebec Derivatives Act prevail.
PART 2 CLEARING AGENCY RECOGNITION OR EXEMPTION FROM RECOGNITION
Application and initial filing of information
2.1 (1) An applicant for recognition as a clearing agency under securities legislation, or for exemption from the requirement to be recognized as a clearing agency pursuant to such securities legislation, must include in its application:
(a) where applicable, the applicant’s most recently completed PFMI Disclosure Framework Document;
(b) sufficient information to demonstrate that the applicant is in compliance with,
(i) provincial and territorial securities legislation, or
(ii) the regulatory regime of a foreign jurisdiction in which the applicant’s head office or principal place of business is located; and
(c) any additional relevant information sufficient to demonstrate that it is in the public interest for the securities regulatory authority to recognize or exempt the applicant, as the case may be.
(2) In addition to the requirement set out in subsection (1), an applicant whose head office or principal place of business is located in a foreign jurisdiction must,
(a) certify that it will assist the securities regulatory authority in accessing the applicant’s books and records and in undertaking an onsite inspection and examination at the applicant’s premises;
(b) certify that it will provide the securities regulatory authority, where requested by such authority, with an opinion of legal counsel that the applicant has, as a matter of law, the power and authority to,
(i) provide the securities regulatory authority with prompt access to its books and records; and
(ii) submit to onsite inspection and examination by the securities regulatory authority.
(3) In addition to the requirements set out in subsections (1) and (2), an applicant whose head office or principal place of business is located in a foreign jurisdiction must file a completed Form 24-102-F1 Submission to Jurisdiction and Appointment of Agent for Service.
(4) An applicant must inform the securities regulatory authority in writing of any material change to the information provided in its application, or if any of the information becomes materially inaccurate for any reason, as soon as the change occurs or the applicant becomes aware of any inaccuracy.
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Request for Comments
Material changes and other changes in information
2.2 (1) In this section, for greater certainty, a “material change” includes, in relation to a clearing agency,
(a) any change to the clearing agency’s constating documents or by-laws;
(b) any change to the clearing agency’s corporate governance or corporate structure, including any change of control of the clearing agency, whether directly or indirectly;
(c) any material change to an agreement among the clearing agency and participants in connection with the clearing agency’s operations and services, including those agreements to which the clearing agency is a party and those agreements among participants to which the clearing agency is not a party, but which are expressly referred to in the clearing agency’s rules or procedures and are made available by participants to the clearing agency;
(d) any material change to the clearing agency’s rules, operating procedures, user guides, manuals, or other documentation governing or establishing the rights, obligations and relationships among the clearing agency and participants in connection with the clearing agency’s operations and services;
(e) any material change to the design, operation or functionality of any of the clearing agency’s operations and services;
(f) the establishment or removal of a link or any material change to an existing link;
(g) commencing to engage in a new type of business activity or ceasing to engage in a business activity in which the clearing agency is then engaged; and
(h) any other matter identified as a material change in the recognition terms and conditions.
(2) A recognized clearing agency must not implement a material change without obtaining the prior written approval of the securities regulatory authority.
(3) If a proposed material change would affect the information set out in its PFMI Disclosure Framework Document filed with the securities regulatory authority, a recognized clearing agency must complete and file with the securities regulatory authority, prior to implementing the material change, an appropriate amendment to the its PFMI Disclosure Framework Document.
(4) Where a recognized clearing agency proposes to modify a fee or introduce a new fee for any of its clearing, settlement or depository services, the clearing agency must notify in writing the securities regulatory authority of such fee change at least twenty business days before implementing the fee change.
(5) An exempt clearing agency must notify in writing the securities regulatory authority which granted the exemption of any material change to the information provided to the securities regulatory authority in its PFMI Disclosure Framework Document and related application materials, or if any of the information becomes materially inaccurate for any reason, as soon as the change occurs or the exempt clearing agency becomes aware of any inaccuracy.
Ceasing to carry on business
2.3 (1) A recognized clearing agency or exempt clearing agency that intends to cease carrying on business in Canada as a clearing agency must file a report on Form 24-102-F2 Cessation of Operations Report for Clearing Agency with the securities regulatory authority,
(a) at least 180 days before ceasing to carry on business if a significant reason for ceasing to carry on business relates to the clearing agency’s financial viability or any other matter that is preventing, or may potentially prevent, it from being able to provide its operations and services as a going concern; or
(b) at least 90 days before ceasing to carry on business for any other reason.
(2) A recognized clearing agency or exempt clearing agency that involuntarily ceases to carry on business in Canada as a clearing agency must file a report on Form 24-102-F2 Cessation of Operations Report for Clearing Agency with the securities regulatory authority as soon as practicable after it ceases to carry on that business.
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Request for Comments
Filing of initial audited financial statements
2.4 (1) An applicant must file audited financial statements for its most recently completed financial year with the securities regulatory authority as part of its application under section 2.1.
(2) The financial statements referred to in subsection (1) must,
(a) be prepared in accordance with Canadian GAAP applicable to publicly accountable enterprises, IFRS or the generally accepted accounting principles of the foreign jurisdiction in which the person or company is incorporated, organized or located,
(b) identify in the notes to the financial statements the accounting principles used to prepare the financial statements,
(c) disclose the presentation currency, and
(d) be audited in accordance with Canadian GAAS, International Standards on Auditing or the generally accepted auditing standards of the foreign jurisdiction in which the person or company is incorporated, organized or located.
(3) The financial statements referred to in subsection (1) must be accompanied by an auditor’s report that,
(a) expresses an unmodified or unqualified opinion,
(b) identifies all financial periods presented for which the auditor’s report applies,
(c) identifies the auditing standards used to conduct the audit,
(d) identifies the accounting principles used to prepare the financial statements,
(e) is prepared in accordance with the same auditing standards used to conduct the audit, and
(f) is prepared and signed by a person or company that is authorized to sign an auditor’s report under the laws of a jurisdiction of Canada or a foreign jurisdiction, and that meets the professional standards of that jurisdiction.
Filing of annual audited and interim financial statements
2.5 (1) A recognized clearing agency or exempt clearing agency must file annual audited financial statements that comply with the requirements in subsections 2.4(2) and (3) with the securities regulatory authority no later than the 90th day after the end of its financial year.
(2) A recognized clearing agency or exempt clearing agency must file interim financial statements that comply with the requirements in paragraphs 2.4(2)(a) and (2)(b) with the securities regulatory authority no later than the 45th day after the end of each interim period.
PART 3 INTERNATIONAL STANDARDS APPLICABLE TO RECOGNIZED CLEARING AGENCIES
Standards
3.1 A recognized clearing agency must establish, implement and maintain rules, procedures, policies or operations designed to ensure that it meets or exceeds the Standards in Appendix A with respect to its clearing, settlement and depository activities.
PART 4 OTHER REQUIREMENTS OF RECOGNIZED CLEARING AGENCIES
Division 1 – Governance:
Board of directors
4.1 (1) A recognized clearing agency must have a board of directors.
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Request for Comments
(2) The board of directors must include appropriate representation by individuals who are
(a) independent of the clearing agency; and
(b) not employees or executive officers of a participant or their immediate family members.
(3) For the purposes of paragraph (2)(a), an individual is independent of a clearing agency if he or she has no direct or indirect material relationship with the clearing agency.
(4) For the purposes of subsection (3), a “material relationship” is a relationship which could, in the view of the clearing agency’s board of directors, be reasonably expected to interfere with the exercise of a member’s independent judgment.
(5) Despite subsection (4), the following individuals are considered to have a material relationship with a clearing agency:
(a) an individual who is, or has been within the last three years, an employee or executive officer of the clearing agency or any of its affiliates;
(b) an individual whose immediate family member is, or has been within the last three years, an executive officer of the clearing agency or any of its affiliates;
(c) an individual who beneficially owns, directly or indirectly, voting securities carrying more than ten per cent of the voting rights attached to all voting securities of the clearing agency or any of its affiliates for the time being outstanding;
(d) an individual whose immediate family member beneficially owns, directly or indirectly, voting securities carrying more than ten per cent of the voting rights attached to all voting securities of the clearing agency or any of its affiliates for the time being outstanding;
(e) an individual who is, or has been within the last three years, an executive officer of a person or company that beneficially owns, directly or indirectly, voting securities carrying more than ten per cent of the voting rights attached to all voting securities of the clearing agency or any of its affiliates for the time being outstanding; and
(f) an individual who accepts or who received during any 12 month period within the last 3 years, directly or indirectly, any audit, consulting, advisory or other compensatory fee from the clearing agency or any of its affiliates, other than as remuneration for acting in his or her capacity as a member of the board of directors or any board committee, or as a part-time chair or vice-chair of the board or any board committee.
(6) For the purposes of subsection (5), the indirect acceptance by an individual of any audit, consulting, advisory or other compensatory fee includes acceptance of a fee by
(a) an individual's immediate family member; or
(b) an entity in which such individual is a partner, a member, an officer such as a managing director occupying a comparable position or an executive officer, or occupies a similar position (except limited partners, non- managing members and those occupying similar positions who, in each case, have no active role in providing services to the entity) and which provides accounting, consulting, legal, investment banking or financial advisory services to the clearing agency or any of its affiliates.
(7) For the purposes of subsection (5), compensatory fees do not include the receipt of fixed amounts of compensation under a retirement plan (including deferred compensation) for prior service with the clearing agency if the compensation is not contingent in any way on continued service.
(8) For the purposes of subsection (5), an individual appointed to the board of directors or board committee of the clearing agency or any of its affiliates or of a person or company referred to in paragraph (5)(e) will not be considered to have a material relationship with the clearing agency solely because the individual acts, or has previously acted, as a chair or vice-chair of the board of directors or a board committee.
(9) If a clearing agency is a reporting issuer and there is a conflict or an inconsistency between this section 4.1 and the provisions of National Instrument 52-110 Audit Committee governing the audit committee members, the provisions of National Instrument 52-110 Audit Committee prevail.
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Request for Comments
Documented procedures regarding risk spill-overs
4.2 The board of directors and management of a recognized clearing agency must have documented procedures to manage possible risk spill over where the clearing agency provides services with a different risk profile than its depository, clearing, and settlement services.
Chief Risk Officer and Chief Compliance Officer
4.3 (1) A recognized clearing agency must designate a chief risk officer and a chief compliance officer, who must report directly to the board of directors or, if determined by the board of directors, to the chief executive officer of the clearing agency.
(2) The chief risk officer must,
(a) have full responsibility and authority to maintain, implement and enforce the risk management framework established by the clearing agency;
(b) make recommendations to the clearing agency’s board of directors regarding the clearing agency’s risk management framework;
(c) monitor the effectiveness of the clearing agency’s risk management framework on an ongoing basis; and
(d) report to the clearing agency’s board of directors on a timely basis upon becoming aware of any significant deficiency with the risk management framework.
(3) The chief compliance officer must,
(a) establish, implement, maintain and enforce written policies and procedures to identify and resolve conflicts of interest and ensure that the clearing agency complies with securities legislation;
(b) monitor compliance with the policies and procedures described under paragraph (a) on an ongoing basis;
(c) report to the board of directors of the clearing agency as soon as practicable upon becoming aware of any circumstance indicating that the clearing agency, or any individual acting on its behalf, is not in compliance with securities legislation and one or more of the following apply:
(i) the non-compliance creates a risk of harm to a participant,
(ii) the non-compliance creates a risk of harm to the broader financial system,
(iii) the non-compliance is part of a pattern of non-compliance, or
(iv) the non-compliance may have an impact on the ability of the clearing agency to carry on business in compliance with securities legislation;
(d) prepare and certify an annual report assessing compliance by the clearing agency, and individuals acting on its behalf, with securities legislation and submit the report to the board of directors; and
(e) report to the clearing agency’s board of directors as soon as practicable upon becoming aware of a conflict of interest that creates a risk of harm to a participant or to the capital markets; and
(f) concurrently with submitting a report under paragraphs (c), (d) or (e), file a copy of such report with the securities regulatory authority.
Board or advisory committees
4.4 The board of directors of a recognized clearing agency must establish and maintain one or more committees on risk management, finance, audit and executive compensation, whose mandates must include, at a minimum, the following:
(a) providing advice and recommendations to the board of directors to assist it in fulfilling its risk management responsibilities, including reviewing and assessing the clearing agency’s risk management policies and procedures, the adequacy of the implementation of appropriate procedures to mitigate and manage such risks, and the clearing agency’s participation standards and collateral requirements;
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Request for Comments
(b) ensuring adequate processes and controls are in place over the models used to quantify, aggregate, and manage the clearing agency’s risks;
(c) monitoring the financial performance of the clearing agency and providing financial management oversight and direction to the business and affairs of the clearing agency;
(d) implementing policies and processes to identify, address, and manage potential conflicts of interest of board members;
(e) regularly reviewing the board of directors’ and senior management’s performance and the performance of each individual member; and
(f) a requirement that these committees,
(i) where the committee is a board committee, be chaired by a sufficiently knowledgeable individual who is independent of the clearing agency,
(ii) subject to clause (iii), have an appropriate representation by individuals who are independent of the clearing agency; and
(iii) where the committee is the audit or risk committee, have an appropriate representation by individuals who are
(A) independent of the clearing agency, and
(B) not employees or executive officers of a participant or their immediate family members.
Division 2 – Default management:
Use of own capital
4.5 A recognized clearing agency that operates as a central counterparty must dedicate and use a reasonable portion of its own capital to cover losses resulting from one or more participant defaults prior to applying the collateral of, or other prefunded financial resources contributed by, the non-defaulting participants.
Division 3 – Operational risk:
Systems requirements
4.6 A recognized clearing agency must, for each of the systems that support its clearing, settlement and depository functions,
(a) develop and maintain,
(i) an adequate system of internal controls over its systems that support the clearing agency’s operations and services, and
(ii) adequate information technology general controls, including without limitation, controls relating to information systems operations, information security, change management, problem management, network support and system software support; and
(b) in accordance with prudent business practice, on a reasonably frequent basis and, in any event, at least annually,
(i) make reasonable current and future capacity estimates, and
(ii) conduct capacity stress tests to determine the ability of those systems to process transactions in an accurate, timely and efficient manner, and
(c) promptly notify the regulator or, in Québec, the securities regulatory authority of any material systems failure, malfunction, delay or security breach and provide timely updates on the status of the failure, malfunction, delay or security breach, the resumption of service and the results of the clearing agency’s internal review of the failure, malfunction, delay or security breach.
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Request for Comments
Systems reviews
4.7 (1) A recognized clearing agency must annually engage a qualified party to conduct an independent systems review and vulnerability assessment and prepare a report in accordance with established audit standards and best industry practices to ensure that the clearing agency is in compliance with paragraph 4.6(a) and section 4.9.
(2) The clearing agency must provide the report resulting from the review conducted under subsection (1) to,
(a) its board of directors, or audit committee, promptly upon the report’s completion; and
(b) the regulator or, in Québec, the securities regulatory authority, within the earlier of 30 days of providing the report to its board of directors or the audit committee or 60 days after the calendar year end.
Clearing agency technology requirements and testing facilities
4.8 (1) A recognized clearing agency must make publicly available, in their final form, all technology requirements regarding interfacing with or accessing the clearing agency,
(a) if operations have not begun, sufficiently in advance of operations to allow a reasonable period for testing and system modification by participants, and
(b) if operations have begun, sufficiently in advance of implementing a material change to technology requirements to allow a reasonable period for testing and system modification by participants.
(2) After complying with subsection (1), the clearing agency must make available testing facilities for interfacing with or accessing the clearing agency,
(a) if operations have not begun, sufficiently in advance of operations to allow a reasonable period for testing and system modification by participants, and
(b) if operations have begun, sufficiently in advance of implementing a material change to technology requirements to allow a reasonable period for testing and system modification by participants.
(3) The clearing agency must not begin operations until it has complied with paragraphs (1)(a) and (2)(a).
(4) Paragraphs (1)(b) and (2)(b) do not apply to the clearing agency if,
(a) the change to its technology requirements must be made immediately to address a failure, malfunction or material delay of its systems or equipment,
(b) the clearing agency immediately notifies the securities regulatory authority of its intention to make the change to its technology requirements, and
(c) the clearing agency publicly discloses the changed technology requirements as soon as practicable.
Testing of business continuity plans
4.9 A recognized clearing agency must test its business continuity plans, including its disaster recovery plans, according to prudent business practices and on a reasonably frequent basis and, in any event, at least annually.
Outsourcing
4.10 If a recognized clearing agency outsources a critical service or system to a service provider, including to an affiliate or associate of the clearing agency, the clearing agency must,
(a) establish, implement, maintain and enforce written policies and procedures to conduct suitable due diligence for selecting service providers to which a critical service and system may be outsourced and for the evaluation and approval of those outsourcing arrangements;
(b) identify any conflicts of interest between the clearing agency and the service provider to which a critical service and system is outsourced, and establish, implement, maintain and enforce written policies and procedures to mitigate and manage those conflicts of interest;
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Request for Comments
(c) enter into a written contract with the service provider to which a critical service or system is outsourced that,
(i) is appropriate for the materiality and nature of the outsourced activities,
(ii) includes service level provisions, and
(iii) provides for adequate termination procedures;
(d) maintain access to the books and records of the service provider relating to the outsourced activities;
(e) ensure that the securities regulatory authority has the same access to all data, information and systems maintained by the service provider on behalf of the clearing agency that it would have absent the outsourcing arrangements;
(f) ensure that all persons conducting audits or independent reviews of the clearing agency under this Instrument have appropriate access to all data, information and systems maintained by the service provider on behalf of the clearing agency that such persons would have absent the outsourcing arrangements,
(g) take appropriate measures to determine that the service provider to which a critical service or system is outsourced establishes, maintains and periodically tests an appropriate business continuity plan, including a disaster recovery plan;
(h) take appropriate measures to ensure that the service provider protects the clearing agency’s proprietary information and participants’ confidential information, including taking measures to protect information from loss, thefts, vulnerabilities, threats, and unauthorized access, copying, use, and modification, and discloses it only in circumstances where legislation or an order of a court or tribunal of competent jurisdiction requires the disclosure of such information; and
(i) establish, implement, maintain and enforce written policies and procedures to monitor the ongoing performance of the service provider’s contractual obligations under the outsourcing arrangements.
Division 4 – Participation requirements:
Access requirements and due process
4.11 (1) A recognized clearing agency must not,
(a) unreasonably prohibit, condition or limit access by a person or company to the services offered by it;
(b) permit unreasonable discrimination among its participants or the customers of its participants;
(c) impose any burden on competition that is not reasonably necessary and appropriate;
(d) unreasonably require the use or purchase of another service for a person or company to utilize the clearing agency’s services offered by it; and
(e) impose fees and other material costs on its participants that are unfairly and inequitably allocated among the participants.
(2) For any decision made by the clearing agency that adversely affects a participant or an applicant that applies to become a participant, the clearing agency must ensure that,
(a) the participant or applicant is given an opportunity to be heard or make representations; and
(b) it keeps records of, gives reasons for, and provides for reviews of its decisions, including, for each applicant, the reasons for granting access or for denying or limiting access to the applicant, as the case may be.
(3) Nothing in subsection (2) shall be construed as to limit or prevent the clearing agency from taking timely action in accordance with its rules and procedures to manage the default of one or more participants or in connection with the clearing agency’s recovery or orderly wind-down, whether or not such action adversely affects a participant.
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Request for Comments
PART 5 BOOKS AND RECORDS AND LEGAL ENTITY IDENTIFIER
Books and records
5.1 (1) A recognized clearing agency or exempt clearing agency must keep such books and records and other documents as are necessary to account for the conduct of its clearing, settlement and depository activities, its business transactions and financial affairs and must keep such other books, records and documents as may otherwise be required under securities legislation.
(2) The clearing agency must retain the books and records maintained under this section
(a) for a period of seven years from the date the record was made or received, whichever is later;
(b) in a safe location and a durable form; and
(c) in a manner that permits it to be provided promptly to the securities regulatory authority upon request.
Legal Entity Identifier
5.2 (1) In this section,
“Global Legal Entity Identifier System” means the system for unique identification of parties to financial transactions developed by the Legal Entity Identifier System Regulatory Oversight Committee; and
“LEI Regulatory Oversight Committee” means the international working group established by the Finance Ministers and the Central Bank Governors of the Group of Twenty nations and the Financial Stability Board, under the Charter of the Regulatory Oversight Committee for the Global Legal Entity Identifier System dated November 5, 2012.
(2) For the purposes of any recordkeeping and reporting requirements required under securities legislation, a recognized clearing agency or exempt clearing agency must identify itself by means of a single legal entity identifier.
(3) Each of the following rules apply to legal entity identifiers:
(a) a legal entity identifier must be a unique identification code assigned to the clearing agency in accordance with the standards set by the Global Legal Entity Identifier System, and
(b) the clearing agency must comply with all applicable requirements imposed by the Global Legal Entity Identifier System.
(4) Despite subsection (3), if the Global Legal Entity Identifier System is unavailable to the clearing agency, all of the following rules apply:
(a) the clearing agency must obtain a substitute legal entity identifier which complies with the standards established by the LEI Regulatory Oversight Committee for pre-legal entity identifiers,
(b) the clearing agency must use the substitute legal entity identifier until a legal entity identifier is assigned to the clearing agency in accordance with the standards set by the Global Legal Entity Identifier System as required under paragraph (3)(a), and
(c) after the holder of a substitute legal entity identifier is assigned a legal entity identifier in accordance with the standards set by the Global Legal Entity Identifier System as required under paragraph (3)(a), the clearing agency must ensure that it is identified only by the assigned identifier.
PART 6 EXEMPTIONS
Exemption
6.1 (1) The regulator or the securities regulatory authority may grant an exemption from the provisions of this Instrument, in whole or in part, subject to such conditions or restrictions as may be imposed in the exemption.
(2) Despite subsection (1), in Ontario, only the regulator may grant an exemption.
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Request for Comments
(3) Except in Ontario, an exemption referred to in subsection (1) is granted under the statute referred to in Appendix B of National Instrument 14-101 Definitions opposite the name of the local jurisdiction.
PART 7 EFFECTIVE DATES AND TRANSITION
Effective dates and transitions
7.1 (1) Except as provided in subsections (2) to (4), this Instrument comes into force on October , 2015.
(2) The requirement in section 3.1 to implement rules, procedures or operations designed to ensure that a recognized clearing agency meets or exceeds Standard 14 in Appendix A to this Instrument comes into force on .
(3) The requirement in section 3.1 to implement rules, procedures or operations designed to ensure that a recognized clearing agency meets or exceeds section 3.4 of Standard 3 and section 15.3 of Standard 15 in Appendix A to this Instrument comes into force on .
(4) The requirement in section 3.1 to implement rules, procedures or operations designed to ensure that a recognized clearing agency meets or exceeds Standard 19 in Appendix A to this Instrument comes into force on .
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Request for Comments
Appendix A
Risk Management Standards Applicable to Recognized Clearing Agencies
Standard 1: Legal basis – A recognized clearing agency has a well-founded, clear, transparent, and enforceable legal basis for each material aspect of its activities in all relevant jurisdictions.
1.1 The legal basis provides a high degree of certainty for each material aspect of the clearing agency’s activities in all relevant jurisdictions.
1.2 The clearing agency has rules, procedures and contracts that are clear, understandable and consistent with relevant laws and regulations.
1.3 The clearing agency articulates the legal basis for its activities to relevant authorities, participants, and, where relevant, participants’ customers, in a clear and understandable way.
1.4 The clearing agency has rules, procedures and contracts that are enforceable in all relevant jurisdictions. There is a high degree of certainty that actions taken by the clearing agency under its rules and procedures will not be voided, reversed or subject to stays.
1.5 If the clearing agency conducts business in multiple jurisdictions, it identifies and mitigates the risks arising from any potential conflicts of laws across jurisdictions.
Standard 2: Governance – A recognized clearing agency has governance arrangements that are clear and transparent, promote the safety and efficiency of the clearing agency, support the stability of the broader financial system, other relevant public interest considerations, and the objectives of relevant stakeholders.
2.1 The clearing agency has objectives that place a high priority on the safety and efficiency of the clearing agency and explicitly support financial stability and other relevant public interest considerations.
2.2 The clearing agency has documented governance arrangements that provide clear and direct lines of responsibility and accountability. These arrangements are disclosed to owners, relevant authorities, participants, and, at a more general level, the public.
2.3 The roles and responsibilities of the clearing agency’s board of directors are clearly specified, and there are documented governance procedures for its functioning, including procedures to identify, address and manage member conflicts of interest. The board of directors reviews both its overall performance and the performance of its individual board members regularly.
2.4 The board of directors contains suitable members with the appropriate skills and incentives to fulfill its multiple roles. This typically requires the inclusion of non-executive board member(s).
2.5 The roles and responsibilities of management are clearly specified. The clearing agency’s management has the appropriate experience, a mix of skills, and the integrity necessary to discharge its responsibilities for the operation and risk management of the clearing agency.
2.6 The board of directors establishes a clear, documented risk-management framework that includes the clearing agency’s risk-tolerance policy, assigns responsibilities and accountability for risk decisions, and addresses decision making in crises and emergencies. Governance arrangements ensure that the risk-management and internal control functions have sufficient authority, independence, resources, and access to the board of directors.
2.7 The board of directors ensures that the clearing agency’s design, rules, overall strategy, and major decisions reflect appropriately the legitimate interests of its direct and indirect participants and other relevant stakeholders. Major decisions are clearly disclosed to relevant stakeholders and, where there is a broad market impact, the public.
Standard 3: Framework for the comprehensive management of risks – A recognized clearing agency has a sound risk- management framework for comprehensively managing legal, credit, liquidity, operational and other risks.
3.1 The clearing agency has risk-management policies, procedures, and systems that enable it to identify, measure, monitor and manage the range of risks that arise in or are borne by it. The risk-management framework is subject to periodic review.
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Request for Comments
3.2 The clearing agency provides incentives to participants and, where relevant, their customers to manage and contain the risks they pose to the clearing agency.
3.3 The clearing agency regularly reviews the material risks it bears from and poses to other entities (such as other clearing agencies, payments systems, trade repositories, settlement banks, liquidity providers and service providers) as a result of interdependencies and develops appropriate risk-management tools to address these risks.
3.4 The clearing agency identifies scenarios that may potentially prevent it from being able to provide its critical operations and services as a going concern and assesses the effectiveness of a full range of options for recovery or orderly wind-down. The clearing agency prepares appropriate plans for its recovery or orderly wind-down based on the results of that assessment. Where applicable, the clearing agency also provides relevant authorities with the information needed for purposes of resolution planning.
Standard 4: Credit risk – A recognized clearing agency that operates as a central counterparty or securities settlement system effectively measures, monitors, and manages its credit exposures to participants and those arising from its clearing and settlement processes. The clearing agency maintains sufficient financial resources to cover its credit exposure to each participant fully with a high degree of confidence. In addition, the clearing agency, if it operates as a central counterparty, that is involved in activities with a more-complex risk profile or that is systemically important in multiple jurisdictions maintains additional financial resources sufficient to cover a wide range of potential stress scenarios that should include, but not be limited to, the default of the two participants and their affiliates that would potentially cause the largest aggregate credit exposure to the clearing agency in extreme but plausible market conditions. All other clearing agencies that operate as a central counterparty maintain additional financial resources sufficient to cover a wide range of potential stress scenarios that should include, but not be limited to, the default of the participant and its affiliates that would potentially cause the largest aggregate credit exposure to the clearing agency in extreme but plausible market conditions.
4.1 The clearing agency establishes a robust framework to manage its credit exposures to its participants and the credit risks arising from its payment, clearing, and settlement processes. Credit exposure may arise from current exposures, potential future exposures, or both.
4.2 The clearing agency identifies sources of credit risk, routinely measures and monitors its credit exposures, and uses appropriate risk-management tools to control these risks.
4.3 The clearing agency, if it operates as a securities settlement system, covers its current exposures and, where they exist, potential future exposures to each participant fully with a high degree of confidence using collateral and other equivalent financial resources. Where the clearing agency operates as a deferred net settlement system, in which there is no settlement guarantee but where its participants face credit exposures arising from its payment, clearing and settlement processes, the clearing agency maintains, at a minimum, sufficient resources to cover the exposures of the two participants and their affiliates that would create the largest aggregate credit exposure in the system.
4.4 The clearing agency that operates as a central counterparty covers its current and potential future exposures to each participant fully with a high degree of confidence using margin and other prefunded financial resources. In addition, the clearing agency that operates as a central counterparty and that is involved in activities with a more- complex risk profile or is systemically important in multiple jurisdictions maintains additional financial resources to cover a wide range of potential stress scenarios that should include, but not be limited to, the default of the two participants and their affiliates that would potentially cause the largest aggregate credit exposure to the clearing agency in extreme but plausible market conditions. All other clearing agencies that operate as a central counterparty maintain additional financial resources sufficient to cover a wide range of potential stress scenarios that should include, but not be limited to, the default of the participant and its affiliates that would potentially cause the largest aggregate credit exposure for the clearing agency in extreme but plausible market conditions. In all cases, the clearing agency that operates as a central counterparty documents its supporting rationale for, and has appropriate governance arrangements relating to, the amount of total financial resources it maintains.
4.5 The clearing agency that operates as a central counterparty determines the amount and regularly tests the sufficiency of its total financial resources available in the event of a default or multiple defaults in extreme but plausible market conditions through rigorous stress testing. The clearing agency has clear procedures to report the results of its stress tests to appropriate decision makers at the clearing agency and to use these results to evaluate the adequacy of and adjust its total financial resources. Stress tests are performed daily using standard and predetermined parameters and assumptions. On at least a monthly basis, the clearing agency performs a comprehensive and thorough analysis of stress testing scenarios, models, and underlying parameters and assumptions used to ensure they are appropriate for determining the clearing agency’s required level of default protection in light of current and evolving market conditions. The clearing agency performs this analysis of stress testing more frequently when the products cleared or markets served display high volatility, become less liquid, or when the size or concentration of positions held by the clearing agency’s participants increases significantly. A full validation of the clearing agency’s risk management model is performed at least annually.
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Request for Comments
4.6 In conducting stress testing, the clearing agency that operates as a central counterparty considers the effect of a wide range of relevant stress scenarios in terms of both defaulters’ positions and possible price changes in liquidation periods. Scenarios include relevant peak historic price volatilities, shifts in other market factors such as price determinants and yield curves, multiple defaults over various time horizons, simultaneous pressures in funding and asset markets, and a spectrum of forward-looking stress scenarios in a variety of extreme but plausible market conditions.
4.7 The clearing agency establishes explicit rules and procedures that address fully any credit losses it may face as a result of any individual or combined default among its participants with respect to any of their obligations to the clearing agency. These rules and procedures address how potentially uncovered credit losses would be allocated, including the repayment of any funds the clearing agency may borrow from liquidity providers. These rules and procedures also indicate the clearing agency’s process to replenish any financial resources that the clearing agency may employ during a stress event, so that the clearing agency can continue to operate in a safe and sound manner.
Standard 5: Collateral – A recognized clearing agency that operates as a central counterparty or securities settlement system and requires collateral to manage its or its participants’ credit exposure, accepts collateral with low credit, liquidity, and market risks. The clearing agency also sets and enforces appropriately conservative haircuts and concentration limits.
5.1 The clearing agency generally limits the assets it (routinely) accepts as collateral to those with low credit, liquidity and market risks.
5.2 The clearing agency establishes prudent valuation practices and develops haircuts that are regularly tested and take into account stressed market conditions.
5.3 In order to reduce the need for procyclical adjustments, the clearing agency establishes stable and conservative haircuts that are calibrated to include periods of stressed market conditions, to the extent practicable and prudent.
5.4 The clearing agency avoids concentrated holdings of certain assets where this would significantly impair the ability to liquidate such assets quickly without significant adverse price effects.
5.5 Where the clearing agency accepts cross-border collateral, it mitigates the risks associated with its use and ensures that the collateral can be used in a timely manner.
5.6 The clearing agency uses a collateral management system that is well-designed and operationally flexible.
Standard 6: Margin – A recognized clearing agency that operates as a central counterparty covers its credit exposures to its participants for all products through an effective margin system that is risk-based and regularly reviewed.
6.1 The clearing agency has a margin system that establishes margin levels commensurate with the risks and particular attributes of each product, portfolio and market it serves.
6.2 The clearing agency has a reliable source of timely price data for its margin system. The clearing agency also has procedures and sound valuation models for addressing circumstances in which pricing data are not readily available or reliable.
6.3 The clearing agency adopts initial margin models and parameters that are risk-based and generate margin requirements sufficient to cover its potential future exposure to participants in the interval between the last margin collection and the close out of positions following a participant default. Initial margin meets an established single-tailed confidence level of at least 99 percent with respect to the estimated distribution of future exposure. For a clearing agency that calculates margin at the portfolio level, this requirement applies to each portfolio’s distribution of future exposure. For a clearing agency that calculates margin at more-granular levels, such as at the subportfolio level or by product, the requirement is met for the corresponding distributions of future exposure. The model (a) uses a conservative estimate of the time horizons for the effective hedging or close out of the particular types of products cleared by the clearing agency (including in stressed market conditions), (b) has an appropriate method for measuring credit exposure that accounts for relevant product risk factors and portfolio effects across products, and (c) to the extent practicable and prudent, limits the need for destabilising, procyclical changes.
6.4 The clearing agency marks participant positions to market and collects variation margin at least daily to limit the build-up of current exposures. The clearing agency has the authority and operational capacity to make intraday margin calls and payments, both scheduled and unscheduled, to participants.
6.5 In calculating margin requirements, the clearing agency may allow offsets or reductions in required margin across products that it clears or between products that it and another central counterparty clear, if the risk of one product is
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Request for Comments
significantly and reliably correlated with the risk of the other product. Where the clearing agency is authorized to offer cross-margining with one or more other central counterparties, it and the other central counterparties have appropriate safeguards and harmonised overall risk-management systems.
6.6 The clearing agency analyses and monitors its model performance and overall margin coverage by conducting rigorous daily backtesting and at least monthly, and more frequently where appropriate, sensitivity analysis. The clearing agency regularly conducts an assessment of the theoretical and empirical properties of its margin model for all products it clears. In conducting sensitivity analysis of the model’s coverage, the clearing agency takes into account a wide range of parameters and assumptions that reflect possible market conditions, including the most volatile periods that have been experienced by the markets it serves and extreme changes in the correlations between prices.
6.7 The clearing agency regularly reviews and validates its margin system.
Standard 7: Liquidity risk – A recognized clearing agency that operates as a central counterparty or securities settlement system effectively measures, monitors, and manages its liquidity risk. The clearing agency maintains sufficient liquid resources in all relevant currencies to effect same-day and, where appropriate, intraday and multiday settlement of payment obligations with a high degree of confidence under a wide range of potential stress scenarios that should include, but not be limited to, the default of the participant and its affiliates that would generate the largest aggregate liquidity obligation for the clearing agency in extreme but plausible market conditions.
7.1 The clearing agency has a robust framework to manage its liquidity risks from its participants, settlement banks, nostro agents, custodian banks, liquidity providers, and other entities.
7.2 The clearing agency has effective operational and analytical tools to identify, measure, and monitor its settlement and funding flows on an ongoing and timely basis, including its use of intraday liquidity.
7.3 The clearing agency that performs the services of a securities settlement system, including one that employs a deferred net settlement mechanism, maintains sufficient liquid resources in all relevant currencies to effect same-day settlement, and where appropriate intraday or multiday settlement, of payment obligations with a high degree of confidence under a wide range of potential stress scenarios that should include, but not be limited to, the default of the participant and its affiliates that would generate the largest aggregate payment obligation in extreme but plausible market conditions.
7.4 The clearing agency that operates as a central counterparty maintains sufficient liquid resources in all relevant currencies to settle securities-related payments, make required variation margin payments, and meet other payment obligations on time with a high degree of confidence under a wide range of potential stress scenarios that should include, but not be limited to, the default of the participant and its affiliates that would generate the largest aggregate payment obligation to the clearing agency in extreme but plausible market conditions. In addition, the clearing agency that operates as a central counterparty, and that is involved in activities with a more-complex risk profile or is systemically important in multiple jurisdictions, considers maintaining additional liquidity resources sufficient to cover a wider range of potential stress scenarios that should include, but not be limited to, the default of the two participants and their affiliates that would generate the largest aggregate payment obligation to the clearing agency in extreme but plausible market conditions.
7.5 For the purpose of meeting its minimum liquid resource requirement, the clearing agency’s qualifying liquid resources in each currency include cash at the central bank of issue or at creditworthy commercial banks, committed lines of credit, committed foreign exchange swaps, and committed repurchase agreements, as well as highly marketable collateral held in custody and investments that are readily available and convertible into cash with prearranged and highly reliable funding arrangements, even in extreme but plausible market conditions. If the clearing agency has access to routine credit at the central bank of issue, the clearing agency may count such access as part of the minimum requirement to the extent it has collateral that is eligible for pledging to, or for conducting other appropriate forms of transactions with, the relevant central bank. All such resources are available when needed.
7.6 The clearing agency may supplement its qualifying liquid resources with other forms of liquid resources. If the clearing agency does so, then these liquid resources are in the form of assets that are likely to be saleable or acceptable as collateral for lines of credit, swaps, or repurchase agreements on an ad hoc basis following a default, even if this cannot be reliably prearranged or guaranteed in extreme market conditions. Even if the clearing agency does not have access to routine central bank credit, it still takes account of what collateral is typically accepted by the relevant central bank, as such assets may be more likely to be liquid in stressed circumstances. The clearing agency does not assume the availability of emergency central bank credit as a part of its liquidity plan.
7.7 The clearing agency obtains a high degree of confidence, through rigorous due diligence, that each provider of its minimum required qualifying liquid resources, whether a participant of the clearing agency or an external party, has
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Request for Comments
sufficient information to understand and to manage its associated liquidity risks, and that it has the capacity to perform as required under its commitment. Where relevant to assessing a liquidity provider’s performance reliability with respect to a particular currency, a liquidity provider’s potential access to credit from the central bank of issue may be taken into account. The clearing agency regularly tests its procedures for accessing its liquid resources at a liquidity provider.
7.8 The clearing agency with access to central bank accounts, payment services, or securities services uses these services, where practical, to enhance its management of liquidity risk.
7.9 The clearing agency determines the amount and regularly tests the sufficiency of its liquid resources through rigorous stress testing. The clearing agency has clear procedures to report the results of its stress tests to appropriate decision makers at the clearing agency and to use these results to evaluate the adequacy of and adjust its liquidity risk- management framework. In conducting stress testing, the clearing agency considers a wide range of relevant scenarios. Scenarios include relevant peak historic price volatilities, shifts in other market factors such as price determinants and yield curves, multiple defaults over various time horizons, simultaneous pressures in funding and asset markets, and a spectrum of forward-looking stress scenarios in a variety of extreme but plausible market conditions. Scenarios also take into account the design and operation of the clearing agency, include all entities that may pose material liquidity risks to the clearing agency (such as settlement banks, nostro agents, custodian banks, liquidity providers, and linked clearing agencies, trade repositories and payment systems), and where appropriate, cover a multiday period. In all cases, the clearing agency documents its supporting rationale for, and has appropriate governance arrangements relating to, the amount and form of total liquid resources it maintains.
7.10 The clearing agency establishes explicit rules and procedures that enable the clearing agency to effect same-day and, where appropriate, intraday and multiday settlement of payment obligations on time following any individual or combined default among its participants. These rules and procedures address unforeseen and potentially uncovered liquidity shortfalls which aim to avoid unwinding, revoking, or delaying the same-day settlement of payment obligations. These rules and procedures also indicate the clearing agency’s process to replenish any liquidity resources it may employ during a stress event, so that it can continue to operate in a safe and sound manner.
Standard 8: Settlement finality – A recognized clearing agency that operates as a central counterparty or securities settlement system provides clear and certain final settlement, at a minimum by the end of the value date. Where necessary or preferable, the clearing agency provides final settlement intraday or in real time.
8.1 The clearing agency’s rules and procedures clearly define the point at which settlement is final.
8.2 The clearing agency completes final settlement no later than the end of the value date, and preferably intraday or in real time, to reduce settlement risk. The clearing agency that operates as a securities settlement system generally considers adopting real-time gross settlement or multiple-batch processing during the settlement day.
8.3 The clearing agency clearly defines the point after which unsettled payments, transfer instructions, or other obligations may not be revoked by a participant.
Standard 9: Money settlements – A recognized clearing agency that operates as a central counterparty or securities settlement system conducts its money settlements in central bank money, where practical and available. If central bank money is not used, the clearing agency minimizes and strictly controls the credit and liquidity risk arising from the use of commercial bank money.
9.1 The clearing agency conducts its money settlements in central bank money, where practical and available, to avoid credit and liquidity risks.
9.2 If central bank money is not used, the clearing agency conducts its money settlements using a settlement asset with little or no credit or liquidity risk.
9.3 If the clearing agency settles in commercial bank money, it monitors, manages, and limits its credit and liquidity risks arising from the commercial settlement banks. In particular, the clearing agency establishes and monitors adherence to strict criteria for its settlement banks that take account of, among other things, their regulation and supervision, creditworthiness, capitalisation, access to liquidity, and operational reliability. The clearing agency also monitors and manages the concentration of credit and liquidity exposures to its commercial settlement banks.
9.4 If the clearing agency conducts money settlements on its own books, it minimizes and strictly controls its credit and liquidity risks.
9.5 The clearing agency’s legal agreements with any settlement banks state clearly when transfers on the books of individual settlement banks are expected to occur, that transfers are to be final when effected, and that funds received are to be transferable as soon as possible, at a minimum by the end of the day and ideally intraday, in order to enable the clearing agency and its participants to manage credit and liquidity risks.
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Request for Comments
Standard 10: Physical deliveries – A recognized clearing agency clearly states its obligations with respect to the delivery of physical instruments or commodities and identifies, monitors and manages the risks associated with such physical deliveries.
10.1 The clearing agency’s rules clearly state its obligations with respect to the delivery of physical instruments or commodities.
10.2 The clearing agency identifies, monitors and manages the risks and costs associated with the storage and delivery of physical instruments and commodities.
Standard 11: Central securities depositories – A recognized clearing agency that operates as a central securities depository has appropriate rules and procedures to help ensure the integrity of securities issues and minimizes and manages the risks associated with the safekeeping and transfer of securities. The clearing agency maintains securities in an immobilized or dematerialized form for their transfer by book entry.
11.1 The clearing agency has appropriate rules, procedures and controls, including robust accounting practices, to safeguard the rights of securities issuers and holders, prevent the unauthorised creation or deletion of securities, and conduct periodic and at least daily reconciliation of securities issues it maintains.
11.2 The clearing agency prohibits overdrafts and debit balances in securities accounts.
11.3 The clearing agency maintains securities in an immobilized or dematerialised form for their transfer by book entry. Where appropriate, the clearing agency provides incentives to immobilize or dematerialise securities.
11.4 The clearing agency protects assets against custody risk through appropriate rules and procedures consistent with its legal framework.
11.5 The clearing agency employs a robust system that ensures segregation between its own assets and the securities of its participants and segregation among the securities of participants. Where supported by the legal framework, the clearing agency also supports operationally the segregation of securities belonging to a participant’s customers on the participant’s books and facilitates the transfer of customer holdings.
11.6 The clearing agency identifies, measures, monitors, and manages its risks from other activities that it may perform; additional tools may be necessary in order to address these risks.
Standard 12: Exchange-of-value settlement systems – Where a recognized clearing agency operates as a central counterparty or securities settlement system and settles transactions that involve the settlement of two linked obligations (for example, securities or foreign exchange transactions), it eliminates principal risk by conditioning the final settlement of one obligation upon the final settlement of the other.
12.1 The clearing agency that is an exchange-of-value settlement system eliminates principal risk by ensuring that the final settlement of one obligation occurs if and only if the final settlement of the linked obligation also occurs, regardless of whether the clearing agency settles on a gross or net basis and when finality occurs.
Standard 13: Participant default rules and procedures – A recognized clearing agency has effective and clearly defined rules and procedures to manage a participant default. These rules and procedures are designed to ensure that the clearing agency can take timely action to contain losses and liquidity pressures and continue to meet its obligations.
13.1 The clearing agency has default rules and procedures that enable the clearing agency to continue to meet its obligations in the event of a participant default and that address the replenishment of resources following a default.
13.2 The clearing agency is well prepared to implement its default rules and procedures, including any appropriate discretionary procedures provided for in its rules.
13.3 The clearing agency publicly discloses key aspects of its default rules and procedures.
13.4 The clearing agency involves its participants and other stakeholders in the testing and review of the clearing agency’s default procedures, including any close-out procedures. Such testing and review is conducted at least annually or following material changes to the clearing agency’s rules and procedures to ensure that they are practical and effective.
Standard 14: Segregation and portability – A recognized clearing agency that operates as a central counterparty has rules and procedures that enable the segregation and portability of positions of a participant’s customers and the collateral provided to the clearing agency with respect to those positions.
November 27, 2014 (2014), 37 OSCB 10538
Request for Comments
14.1 The clearing agency has, at a minimum, segregation and portability arrangements that effectively protect a participant’s customers’ positions and related collateral from the default or insolvency of that participant. If the clearing agency additionally offers protection of such customer positions and collateral against the concurrent default of the participant and a fellow customer, the clearing agency takes steps to ensure that such protection is effective.
14.2 The clearing agency employs an account structure that enables it readily to identify positions of a participant’s customers and to segregate related collateral. The clearing agency maintains customer positions and collateral in individual customer accounts or in omnibus customer accounts.
14.3 The clearing agency structures its portability arrangements in a way that makes it highly likely that the positions and collateral of a defaulting participant’s customers will be transferred to one or more other participants.
14.4 The clearing agency discloses its rules, policies, and procedures relating to the segregation and portability of a participant’s customers’ positions and related collateral. In particular, the clearing agency discloses whether customer collateral is protected on an individual or omnibus basis. In addition, the clearing agency discloses any constraints, such as legal or operational constraints, that may impair its ability to segregate or port the participant’s customers’ positions and related collateral.
Standard 15: General business risk – A recognized clearing agency identifies, monitors, and manages its general business risk and holds sufficient liquid net assets funded by equity to cover potential general business losses so that it can continue operations and services as a going concern if those losses materialise. Further, liquid net assets are at all times sufficient to ensure a recovery or orderly wind-down of critical operations and services.
15.1 The clearing agency has robust management and control systems to identify, monitor, and manage general business risks, including losses from poor execution of business strategy, negative cash flows, or unexpected and excessively large operating expenses.
15.2 The clearing agency holds liquid net assets funded by equity (such as common stock, disclosed reserves, or other retained earnings) so that it can continue operations and services as a going concern if it incurs general business losses. The amount of liquid net assets funded by equity the clearing agency holds is determined by its general business risk profile and the length of time required to achieve a recovery or orderly wind-down, as appropriate, of its critical operations and services if such action is taken.
15.3 The clearing agency maintains a viable recovery or orderly wind-down plan and holds sufficient liquid net assets funded by equity to implement this plan. At a minimum, the clearing agency holds liquid net assets funded by equity equal to at least six months of current operating expenses. These assets are in addition to resources held to cover participant defaults and other risks required to be covered under the financial resources Standards. However, equity held under international risk-based capital standards can be included where relevant and appropriate to avoid duplicate capital requirements.
15.4 Assets held to cover general business risk are of high quality and sufficiently liquid in order to allow the clearing agency to meet its current and projected operating expenses under a range of scenarios, including in adverse market conditions.
15.5 The clearing agency maintains a viable plan for raising additional equity should its equity fall close to or below the amount needed. This plan is approved by the board of directors and updated regularly.
Standard 16: Custody and investment risks – A recognized clearing agency safeguards its own and its participants’ assets and minimizes the risk of loss on and delay in access to these assets. The clearing agency’s investments are in instruments with minimal credit, market, and liquidity risks.
16.1 The clearing agency holds its own and its participants’ assets at supervised and regulated entities that have robust accounting practices, safekeeping procedures, and internal controls that fully protect such assets.
16.2 The clearing agency has prompt access to its assets and the assets provided by participants, when required.
16.3 The clearing agency evaluates and understands its exposures to its custodian banks, taking into account the full scope of its relationships with each.
16.4 The clearing agency’s investment strategy is consistent with its overall risk-management strategy and fully disclosed to its participants, and investments are secured by, or claims on, high-quality obligors. These investments allow for quick liquidation with little, if any, adverse price effect.
November 27, 2014 (2014), 37 OSCB 10539
Request for Comments
Standard 17: Operational risks – A recognized clearing agency identifies the plausible sources of operational risk, both internal and external, and mitigates their impact through the use of appropriate systems, policies, procedures, and controls. Systems are designed to ensure a high degree of security and operational reliability and have adequate, scalable capacity. Business continuity management aims for timely recovery of operations and fulfillment of the clearing agency’s obligations, including in the event of a wide-scale or major disruption.
17.1 The clearing agency establishes a robust operational risk-management framework with appropriate systems, policies, procedures, and controls to identify, monitor, and manage operational risks.
17.2 The clearing agency’s board of directors clearly defines the roles and responsibilities for addressing operational risk and endorses the clearing agency’s operational risk-management framework. Systems, operational policies, procedures, and controls are reviewed, audited, and tested periodically and after significant changes.
17.3 The clearing agency has clearly defined operational reliability objectives and has policies in place that are designed to achieve those objectives.
17.4 The clearing agency ensures that it has scalable capacity adequate to handle increasing stress volumes and to achieve its service-level objectives.
17.5 The clearing agency has comprehensive physical and information security policies that address all potential vulnerabilities and threats.
17.6 The clearing agency has a business continuity plan that addresses events posing a significant risk of disrupting operations, including events that could cause a wide-scale or major disruption. The plan incorporates the use of a secondary site and is designed to ensure that critical information technology (IT) systems can resume operations within two hours following disruptive events. The plan is designed to enable the clearing agency to complete settlement by the end of the day of the disruption, even in extreme circumstances. The clearing agency regularly tests these arrangements.
17.7 The clearing agency identifies, monitors, and manages the risks that key participants, other clearing agencies, trade repositories, payment systems, and service and utility providers might pose to its operations. In addition, the clearing agency identifies, monitors, and manages the risks its operations might pose to other clearing agencies, trade repositories, and payment systems.
Standard 18: Access and participation requirements – A recognized clearing agency has objective, risk-based, and publicly disclosed criteria for participation, which permit fair and open access.
18.1 The clearing agency allows for fair and open access to its services, including by direct and, where relevant, indirect participants and other clearing agencies, payment systems and trade repositories, based on reasonable risk- related participation requirements.
18.2 The clearing agency’s participation requirements are justified in terms of the safety and efficiency of the clearing agency and the markets it serves, are tailored to and commensurate with the clearing agency’s specific risks, and are publicly disclosed. Subject to maintaining acceptable risk control standards, the clearing agency endeavours to set requirements that have the least-restrictive impact on access that circumstances permit.
18.3 The clearing agency monitors compliance with its participation requirements on an ongoing basis and has clearly defined and publicly disclosed procedures for facilitating the suspension and orderly exit of a participant that breaches, or no longer meets, the participation requirements.
Standard 19: Tiered participation arrangements – A recognized clearing agency identifies, monitors, and manages the material risks to the clearing agency arising from any tiered participation arrangements.
19.1 The clearing agency ensures that its rules, procedures, and agreements allow it to gather basic information about indirect participation in order to identify, monitor, and manage any material risks to the clearing agency arising from such tiered participation arrangements.
19.2 The clearing agency identifies material dependencies between direct and indirect participants that might affect the clearing agency.
19.3 The clearing agency identifies indirect participants responsible for a significant proportion of transactions processed by the clearing agency and indirect participants whose transaction volumes or values are large relative to the capacity of the direct participants through which they access the clearing agency in order to manage the risks arising from these transactions.
November 27, 2014 (2014), 37 OSCB 10540
Request for Comments
19.4 The clearing agency regularly reviews risks arising from tiered participation arrangements and takes mitigating action when appropriate.
Standard 20: Links with other financial market infrastructures – A recognized clearing agency that establishes a link with one or more clearing agencies or trade repositories identifies, monitors, and manages link-related risks.
20.1 Before entering into a link and on an ongoing basis once the link is established, the clearing agency identifies, monitors, and manages all potential sources of risk arising from the link. Links are designed such that the clearing agency is able to observe the other Standards.
20.2 A link has a well-founded legal basis, in all relevant jurisdictions, that supports its design and provides adequate protection to the clearing agencies and trade repositories involved in the link.
20.3 Linked central securities depositories measure, monitor, and manage the credit and liquidity risks arising from each other. Any credit extensions between central securities depositories are covered fully with high-quality collateral and are subject to limits.
20.4 Provisional transfers of securities between linked central securities depositories are prohibited or, at a minimum, the retransfer of provisionally transferred securities are prohibited prior to the transfer becoming final.
20.5 An investor central securities depository only establishes a link with an issuer central securities depository if the link provides a high level of protection for the rights of the investor central securities depository’s participants.
20.6 An investor central securities depository that uses an intermediary to operate a link with an issuer central securities depository measures, monitors, and manages the additional risks (including custody, credit, legal, and operational risks) arising from the use of the intermediary.
20.7 Before entering into a link with another central counterparty, a central counterparty identifies and manages the potential spill-over effects from the default of the linked central counterparty. If a link has three or more central counterparties, each central counterparty identifies, assesses, and manages the risks of the collective link.
20.8 Each central counterparty in a central counterparty link is able to cover, at least on a daily basis, its current and potential future exposures to the linked central counterparty and its participants, if any, fully with a high degree of confidence without reducing the central counterparty’s ability to fulfill its obligations to its own participants at any time.
Standard 21: Efficiency and effectiveness – A recognized clearing agency is efficient and effective in meeting the requirements of its participants and the markets it serves.
21.1 The clearing agency is designed to meet the needs of its participants and the markets it serves, in particular, with regard to choice of a clearing and settlement arrangement; operating structure; scope of products cleared, settled, or recorded; and use of technology and procedures.
21.2 The clearing agency has clearly defined goals and objectives that are measurable and achievable, such as in the areas of minimum service levels, risk-management expectations, and business priorities.
21.3 The clearing agency has established mechanisms for the regular review of its efficiency and effectiveness.
Standard 22: Communication procedures and standards – A recognized clearing agency uses, or at a minimum accommodates, relevant internationally accepted communication procedures and standards in order to facilitate efficient payment, clearing, settlement, depository, and recording.
22.1 The clearing agency uses, or at a minimum accommodates, internationally accepted communication procedures and standards.
Standard 23: Disclosure of rules, key procedures, and market data – A recognized clearing agency has clear and comprehensive rules and procedures and provides sufficient information to enable participants to have an accurate understanding of the risks, fees, and other material costs they incur by participating in the clearing agency. All relevant rules and key procedures are publicly disclosed.
23.1 The clearing agency adopts clear and comprehensive rules and procedures that are fully disclosed to participants. Relevant rules and key procedures are also publicly disclosed.
November 27, 2014 (2014), 37 OSCB 10541
Request for Comments
23.2 The clearing agency discloses clear descriptions of the clearing agency’s systems’ design and operations, as well as the rights and obligations of the clearing agency and its participants, so that participants can assess the risks they would incur by participating in the clearing agency.
23.3 The clearing agency provides all necessary and appropriate documentation and training to facilitate participants’ understanding of the clearing agency’s rules and procedures and the risks they face from participating in the clearing agency.
23.4 The clearing agency publicly discloses its fees at the level of individual services it offers as well as its policies on any available discounts. The clearing agency provides clear descriptions of priced services for comparability purposes.
23.5 The clearing agency completes regularly and discloses publicly responses to the PFMI Disclosure Framework Document. The clearing agency also, at a minimum, discloses basic data on transaction volumes and values.
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November 27, 2014 (2014), 37 OSCB 10542
Request for Comments
FORM 24-102F1 NATIONAL INSTRUMENT 24-102 – CLEARING AGENCY REQUIREMENTS
CLEARING AGENCY SUBMISSION TO JURISDICTION AND APPOINTMENT OF AGENT FOR SERVICE OF PROCESS
1. Name of clearing agency (the “Clearing Agency”):
______
2. Jurisdiction of incorporation, or equivalent, of Clearing Agency:
______
3. Address of principal place of business of Clearing Agency:
______
4. Name of the agent for service of process for the Clearing Agency (the “Agent”):
______
5. Address of Agent for service of process in ______[province of local jurisdiction]:
______
6. The ______[name of securities regulatory authority] (“securities regulatory authority”) issued an order recognizing the Clearing Agency as a clearing agency pursuant to securities legislation, or the securities regulatory authority issued an order exempting the Clearing Agency from the requirement to be recognized as a clearing agency pursuant to such legislation, on ______.
7. The Clearing Agency designates and appoints the Agent as its agent upon whom may be served a notice, pleading, subpoena, summons or other process in any action, investigation or administrative, criminal, quasi-criminal, penal or other proceeding arising out of or relating to or concerning the activities of the Clearing Agency in ______[province of local jurisdiction]. The Clearing Agency hereby irrevocably waives any right to challenge service upon its Agent as not binding upon the Clearing Agency.
8. The Clearing Agency agrees to unconditionally and irrevocably attorn to the non-exclusive jurisdiction of (i) the courts and administrative tribunals of ______[province of local jurisdiction] and (ii) any proceeding in any province or territory arising out of, related to, concerning or in any other manner connected with the regulation and oversight of the activities of the Clearing Agency in ______[province of local jurisdiction].
9. The Clearing Agency shall file a new submission to jurisdiction and appointment of agent for service of process in this form at least 30 days before the Clearing Agency ceases to be recognized or exempted by the securities regulatory authority, to be in effect for six years from the date it ceases to be recognized or exempted unless otherwise amended in accordance with section 10.
10. Until six years after it has ceased to be a recognized or exempted by the securities regulatory authority, the Clearing Agency shall file an amended submission to jurisdiction and appointment of agent for service of process at least 30 days before any change in the name or above address of the Agent.
11. This submission to jurisdiction and appointment of agent for service of process shall be governed by and construed in accordance with the laws of ______[province of local jurisdiction].
Dated: ______
______Signature of the Clearing Agency
______Print name and title of signing officer of the Clearing Agency
November 27, 2014 (2014), 37 OSCB 10543
Request for Comments
AGENT
CONSENT TO ACT AS AGENT FOR SERVICE
I, ______(name of Agent in full; if Corporation, full Corporate name) of ______(business address), hereby accept the appointment as agent for service of process of ______(insert name of Clearing Agency) and hereby consent to act as agent for service pursuant to the terms of the appointment executed by ______(insert name of Clearing Agency) on ______(insert date).
Dated: ______
______Signature of Agent
______Print name of person signing and, if Agent is not an individual, the title of the person
November 27, 2014 (2014), 37 OSCB 10544
Request for Comments
FORM 24-102F2 NATIONAL INSTRUMENT 24-102 – CLEARING AGENCY REQUIREMENTS
CESSATION OF OPERATIONS REPORT FOR CLEARING AGENCY
1. Identification:
A. Full name of the recognized or exempted clearing agency:
B. Name(s) under which business is conducted, if different from item 1A:
2. Date clearing agency proposes to cease carrying on business as a clearing agency:
3. If cessation of business was involuntary, date clearing agency has ceased to carry on business as a clearing agency:
Exhibits
File all Exhibits with the Cessation of Operations Report. For each exhibit, include the name of the clearing agency, the date of filing of the exhibit and the date as of which the information is accurate (if different from the date of the filing). If any Exhibit required is inapplicable, a statement to that effect shall be furnished instead of such Exhibit.
Exhibit A
The reasons for the clearing agency ceasing to carry on business as a clearing agency.
Exhibit B
A list of all participants in Canada during the last 30 days prior to ceasing business as a clearing agency.
Exhibit C
A description of the alternative arrangements available to participants in respect of the services offered by the clearing agency immediately prior to the cessation of business as a clearing agency.
Exhibit D
A description of all links the clearing agency had immediately prior to the cessation of business as a clearing agency with other clearing agencies or trade repositories.
CERTIFICATE OF CLEARING AGENCY
The undersigned certifies that the information given in this report is true and correct.
DATED at ______this ______day of ______20 _____
______(Name of clearing agency)
______(Name of director, officer or partner – please type or print)
______(Signature of director, officer or partner)
______(Official capacity – please type or print)
November 27, 2014 (2014), 37 OSCB 10545
Request for Comments
COMPANION POLICY
TO
NATIONAL INSTRUMENT 24 – 102 CLEARING AGENCY REQUIREMENTS
TABLE OF CONTENTS
PART 1 GENERAL COMMENTS
PART 2 CLEARING AGENCY RECOGNITION OR EXEMPTION FROM RECOGNITION
PART 3 INTERNATIONAL STANDARDS APPLICABLE TO RECOGNIZED CLEARING AGENCIES
PART 4 OTHER REQUIREMENTS OF RECOGNIZED CLEARING AGENCIES Division 1 – Governance Division 2 – Default management Division 3 – Operational risk Division 4 – Participation requirements
PART 5 BOOKS AND RECORDS AND LEGAL ENTITY IDENTIFIER
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November 27, 2014 (2014), 37 OSCB 10546
Request for Comments
PART 1 GENERAL COMMENTS
Introduction
1.1 (1) This Companion Policy (CP) sets out how the Canadian Securities Administrators (the CSA or we) interpret or apply provisions of National Instrument 24-102 Clearing Agency Requirements (the Instrument) and related securities legislation.
(2) Except for Part 1 and the text boxes in Part 3 of this CP, the numbering of Parts, sections and subsections in this CP generally corresponds to the numbering in the Instrument. Any general guidance or introductory comments for a Part appears immediately after the Part’s name. Specific guidance on a section or subsection in the Instrument follows any general guidance. If there is no guidance for a Part, section or subsection, the numbering in this CP will skip to the next provision that does have guidance.
(3) Unless otherwise stated, any reference to a Part, section, subsection, paragraph, defined term or Appendix in this CP is a reference to the corresponding Part, section, subsection, paragraph, defined term or Appendix in the Instrument.
Background and overview
1.2 (1) Securities legislation in certain Jurisdictions of Canada requires an entity seeking to carry on business as a clearing agency in the jurisdiction to be (i) recognized by the securities regulatory authority in that jurisdiction, or (ii) exempted from the recognition requirement.1 Accordingly, Part 2 sets out certain requirements in connection with the application process for recognition as a clearing agency or exemption from the recognition requirement. Guidance on the CSA’s regulatory approach to such an application is set out in this CP.
(2) Parts 3 and 4 set out on-going requirements applicable to a recognized clearing agency. Whereas Part 3 applies only to a clearing agency that operates as a central counterparty (CCP), securities settlement system (SSS) or central securities depository (CSD), Part 4 applies to a clearing agency whether or not it operates as a CCP, SSS or CSD. The Standards in Appendix A are based on international standards governing financial market infrastructures (FMIs) set forth in the April 2012 report Principles for financial market infrastructures (the PFMIs or PFMI Report, as the context requires). The PFMIs were developed jointly by the Committee on Payments and Market Infrastructures (CPMI)2 and the International Organization of Securities Commissions (IOSCO).3 The PFMIs harmonize and strengthen previous international standards for FMIs.4
(3) Part 3 incorporates the Standards that are relevant to a clearing agency that operates as a CCP, CSD and SSS. Part 3 of this CP includes supplementary guidance in text boxes that applies to recognized domestic clearing agencies that are also regulated by the Bank of Canada (BOC). The supplementary guidance (Joint Supplementary Guidance) was prepared jointly by the CSA and BOC to provide additional clarity on certain aspects of the Standards within the Canadian context.
Definitions, interpretation and application
1.3 (1) Unless defined in the Instrument or this CP, defined terms used in the Instrument and this CP have the meaning given to them in the securities legislation of each jurisdiction or in National Instrument 14-101 Definitions.
(2) The terms “clearing agency” and “recognized clearing agency” are generally defined in securities legislation. For the purposes of the Instrument, a clearing agency includes, in Quebec, a clearing house, central securities depository and settlement system within the meaning of the Québec Securities Act and a derivatives clearing house and settlement system within the meaning of the Québec Derivatives Act. The CSA notes that, while Part 3 applies only to a recognized clearing agency that operates as a CCP, CSD or SSS, the term “clearing agency” may incorporate certain other centralized post-trade functions that are not necessarily limited to those of a CCP, CSD or SSS, e.g. an entity that provides centralized facilities for comparing data respecting the terms of settlement of a trade or transaction may be considered a clearing agency, but would not be considered a CCP, CSD or SSS. Except in Québec, such an entity would be required to apply either for recognition as a
1 In certain jurisdictions, the entity is prohibited from carrying on business as a clearing agency unless recognized or exempted. 2 Prior to September 1, 2014, CPMI was known as the Committee on Payment and Settlement Systems (CPSS). 3 See the CPMI-IOSCO Principles for Financial Market Infrastructures Report, published in April 2012, available on the Bank for International Settlements’ website (www.bis.org) and the IOSCO website (www.iosco.org). 4 See (i) 2001 CPMI report Core principles for systemically important payment systems, (ii) 2001 CPMI-IOSCO report Recommendations for securities settlement systems (together with the 2002 CPMI-IOSCO report Assessment methodology for Recommendations for securities settlement systems); and (iii) 2004 CPMI-IOSCO report Recommendations for central counterparties. All of these reports are available on the Bank for International Settlements’ website (www.bis.org). The CPMI-IOSCO reports are also available on IOSCO website (www.iosco.org).
November 27, 2014 (2014), 37 OSCB 10547
Request for Comments clearing agency or an exemption from the requirement to be recognized. Whether applying for recognition or for an exemption, the entity would become subject to certain provisions in Part 2 and all of Parts 4 and 5, but not Part 3.5
(3) A clearing agency may serve either or both the securities and derivatives markets. A clearing agency serving the securities markets can be a CCP, CSD or SSS. A clearing agency serving the derivatives markets is typically only a CCP.
(4) In this CP, FMI means a financial market infrastructure, which the PFMI Report describes as follows: payment systems, CSDs, SSSs, CCPs and trade repositories.
PART 2 CLEARING AGENCY RECOGNITION OR EXEMPTION FROM RECOGNITION
Recognition and exemption
2.0 (1) An entity seeking to carry on business as a clearing agency in certain jurisdictions in Canada is required under the securities legislation of such jurisdictions to apply for recognition or an exemption. For greater clarity, a foreign-based clearing agency that provides or will provide its services or facilities to a person or company resident in a jurisdiction would be considered to be carrying on business in that jurisdiction.
– Recognition of a clearing agency
(2) Generally, we take the view that a clearing agency that is systemically important to a jurisdiction’s capital markets or that is not subject to comparable regulation by another regulatory body should be recognized by a securities regulatory authority. A securities regulatory authority may consider the systemic importance of a clearing agency to its capital markets based on the following list of guiding factors: value and volume of transactions processed, cleared and settled by the clearing agency;6 risk exposures (particularly credit and liquidity) of the clearing agency to its participants; complexity of the clearing agency;7 and centrality of the clearing agency with respect to its role in the market, including its substitutability, relationships, interdependencies and interactions.8 The list of guiding factors is non-exhaustive, and no single factor described above will be determinative in an assessment of systemic importance. A securities regulatory authority retains the ability to consider additional quantitative and qualitative factors as may be relevant and appropriate.9
– Exemption from recognition
(3) Depending on the circumstances, a clearing agency may be granted an exemption from recognition pursuant to securities legislation and subject to appropriate terms and conditions, where it is not considered systemically important or where it does not otherwise pose significant risk to the capital markets. For example, such an approach may be considered for an entity that provides limited services or facilities, thereby not warranting full regulation, such as a clearing agency that does not perform the functions of a CCP, CSD or SSS. However, in such cases, terms and conditions may be imposed. In addition, a foreign-based clearing agency that is already subject to a comparable regulatory regime in its home jurisdiction may be granted an exemption from the recognition requirement as full regulation may be duplicative and inefficient when imposed in addition to the regulation of the home jurisdiction. The exemption may be subject to certain terms and conditions, including reporting requirements and prior notification of certain material changes to information provided to the securities regulatory authority.
Application and initial filing of information
2.1 The application process for both recognition and exemption from recognition as a clearing agency is similar. The entity that applies will typically be the entity that operates the facility or performs the functions of a clearing agency. The application for recognition or exemption will require completion of appropriate documentation. This will include the items listed in subsection 2.1(1). Together, the application materials should present a detailed description of the history, regulatory structure (if any), and business operations of the clearing agency. A clearing agency that operates as a CCP, CSD or SSS will need to describe how it
5 In Québec, an entity that provides such centralized facilities for comparing data would be required to apply either for recognition as a matching service utility or for an exemption from the recognition requirement, in application of the provisions of National Instrument 24-101 Institutional Trade Matching and Settlement. 6 We would consider, for example, the current aggregate monetary values and volumes of such transactions, as well as the entity’s potential for growth. 7 We would look, for example, to the nature and complexity of the clearing agency, taking into account an analysis of the various products it processes, clears or settles. 8 We would consider, for example, the centrality or importance of the clearing agency to the particular market or markets it serves, based on the degree to which it critically supports, or that its failure or disruption would affect, such markets or the entire Canadian financial infrastructure. 9 Additional factors may be based on the characteristics of the clearing agency under review, such as the nature of its operations, its corporate structure, or its business model.
November 27, 2014 (2014), 37 OSCB 10548
Request for Comments meets or will meet the requirements of Parts 3 and 4. An applicant based in a foreign jurisdiction should also provide a detailed description of the regulatory regime of its home jurisdiction and the requirements imposed on the clearing agency, including how such requirements are similar to the requirements in Parts 3 and 4.
Where specific information items of the PFMI Disclosure Framework Document are not relevant to an applicant because of the nature or scope of its clearing agency activities, its structure, the products it clears or settles, or its regulatory environment, the application should explain in reasonable detail why the information items are not relevant.
The application filed by an applicant will generally be published for public comment for a 30-day period. Other materials filed with the application, which the applicant wishes to maintain confidential, will generally be kept confidential in accordance with securities and privacy legislation. However, the clearing agency will be required to publicly disclose its PFMI Disclosure Framework Document. See Standard 23.5 in Appendix A.
Material changes and other changes in information
2.2 (2) Under subsection 2.2(2), a recognized clearing agency must receive prior written approval before implementing a material change, unless otherwise provided in the terms and conditions of the recognition decision. The term “material change” is defined in subsection 2.2(1). Any relevant procedures for notifying the securities regulatory authority of a material change and for the authority’s review, approval and publication of the material change, are normally set out in the terms and conditions of the recognition decision.
(4) We recognize that a recognized clearing agency may frequently change their fees or fee structure and may need to implement fee changes within tight timeframes. To facilitate this process, subsection 2.2(4) provides that a recognized clearing agency need only notify the securities regulatory authority at least twenty business days before implementing the fee.
Ceasing to Carry on Business
2.3 A recognized or exempt clearing agency that ceases to carry on business in Canada as a clearing agency, either voluntarily or involuntarily, must file a completed Form 24-102F2 Cessation of Operations Report for Clearing Agency within the appropriate timelines. In certain jurisdictions, the clearing agency intending to cease carrying on business must also make an application to voluntarily surrender its recognition to the securities regulatory authority pursuant to securities legislation. The securities regulatory authority may accept the voluntary surrender subject to terms and conditions.10
PART 3 INTERNATIONAL STANDARDS APPLICABLE TO RECOGNIZED CLEARING AGENCIES
Introduction
3.0 The Standards in Appendix A are derived from the PFMIs. We have included in the Standards only those PFMIs that are relevant to clearing agencies operating as a CCP, CSD or SSS.11
Standards
3.1 In interpreting and implementing the Standards, regard is to be given to the explanatory notes in the PFMI Report, as appropriate. As discussed in subsection 1.2(3) of this CP, the CSA and BOC have together developed Joint Supplementary Guidance to provide additional clarity on certain aspects of some Standards within the Canadian context. The Joint Supplementary Guidance is directed at recognized domestic clearing agencies that are also regulated by the BOC. The Joint Supplementary Guidance is included in separate text boxes below under the relevant headings of the Standards. Other recognized domestic clearing agencies should assess the applicability of the Joint Supplementary Guidance to their respective entity as well.
10 See, for example, section 21.4 of the Securities Act (Ontario). 11 International standards that are relevant to payment systems and trade repositories, but not CCPs, SSSs and CSDs, have not been included in the Standards in Appendix A.
November 27, 2014 (2014), 37 OSCB 10549
Request for Comments
– Standard 2: Governance
Box 1: Joint Supplementary Guidance – Financial Stability and Other Public Interest Considerations
Context
The PFMIs define governance as the set of relationships between an FMI’s owners, board of directors (or equivalent), management, and other relevant parties, including participants, authorities, and other stakeholders (such as participants’ customers, other interdependent FMIs, and the broader market). Governance provides the processes through which an organization sets its objectives, determines the means for achieving those objectives, and monitors performance against those objectives. This note provides supplementary regulatory guidance for Canadian FMIs on their governance arrangements as it relates to supporting relevant public interest considerations.
Public interest considerations in the context of the PFMIs
The PFMIs indicate that FMIs should “explicitly support financial stability and other relevant public interests.” However, there may be circumstances where providing explicit support of relevant public interests conflict with other FMI objectives and therefore require appropriate prioritization and balancing. For example, addressing the potential trade-offs between protecting the participants and the FMI while ensuring the financial stability interests are upheld.
Guidance within the PFMIs
The following text has been extracted directly from the PFMIs. The pertinent information is in bold italics.
PFMI paragraph 3.2.2:
Given the importance of FMIs and the fact that their decisions can have widespread impact, affecting multiple financial institutions, markets, and jurisdictions, it is essential for each FMI to place a high priority on the safety and efficiency of its operations and explicitly support financial stability and other relevant public interests. Supporting the public interest is a broad concept that includes, for example, fostering fair and efficient markets. For example, in certain over the counter derivatives markets, industry standards and market protocols have been developed to increase certainty, transparency, and stability in the market. If a CCP in such markets were to diverge from these practices, it could, in some cases, undermine the market’s efforts to develop common processes to help reduce uncertainty. An FMI’s governance arrangements should also include appropriate consideration of the interests of participants, participants’ customers, relevant authorities, and other stakeholders. (...) For all types of FMIs, governance arrangements should provide for fair and open access (see Principle 18 on access and participation requirements) and for effective implementation of recovery or wind-down plans, or resolution.
PFMI paragraph 3.2.8:
An FMI’s board has multiple roles and responsibilities that should be clearly specified. These roles and responsibilities should include (a) establishing clear strategic aims for the entity; (b) ensuring effective monitoring of senior management (including selecting its senior managers, setting their objectives, evaluating their performance, and, where appropriate, removing them); (c) establishing appropriate compensation policies (which should be consistent with best practices and based on long-term achievements, in particular, the safety and efficiency of the FMI); (d) establishing and overseeing the risk-management function and material risk decisions; (e) overseeing internal control functions (including ensuring independence and adequate resources); (f) ensuring compliance with all supervisory and oversight requirements; (g) ensuring consideration of financial stability and other relevant public interests; and (h) providing accountability to the owners, participants, and other relevant stakeholders.
The CPMI-IOSCO PFMI Disclosure framework and Assessment methodology provides questions to guide the assessment of the FMI against the PFMIs. Questions related to public interest considerations are focused on ensuring that the FMI’s objectives are clearly defined, giving a high priority to safety, financial stability and efficiency while also ensuring all other public interest considerations are identified and reflected in the FMI’s objectives.
November 27, 2014 (2014), 37 OSCB 10550
Request for Comments
Supplementary Guidance for designated Canadian FMIs
By definition the PFMIs apply to systemically important FMIs, so safety and financial stability objectives should be given a high priority.
Efficiency is also a high priority that should contribute to (but not supersede) the safety and financial stability objectives.
Other public interest considerations such as competition and fair and open access should also be considered in the broader safety and financial stability context.
A framework (objectives, policies and procedures) should be in place for default and other emergency situations. The framework should articulate explicit principles to ensure financial stability and other relevant public interests are considered as part of the decision making process. For example, it should provide guidance on discretionary management decisions, consider the trade-offs between protecting the participants and the FMI while also ensuring the financial stability interests are upheld, and articulate a communication protocol with the board and regulators.
Practical questions/approaches to assessing the appropriateness of the framework include:
• Does the enabling legislation, articles of incorporation, corporate by-laws, corporate mission, vision statements, corporate risk statements/frameworks/methodology clearly articulate the objectives and are they appropriately aligned and communicated (transparent)?
• Do the objectives give appropriate priority to safety, financial stability, efficiency and other public interest considerations?
• Does the Board structure ensure the right mix of skills/experience and interests are in place to ensure the objectives are clear, appropriately prioritized, achieved and measured?
• What is the training provided to the Board and management to support the objectives?
• Do the service offerings and business plans support the objectives?
• Do the system design, rules, procedures support the objectives?
• Are the inter-dependencies and key dependencies considered and managed in the context of the broader financial stability objectives? For instance, do problem and default management policies and procedures appropriately provide for consideration of the broader financial stability interests and do they engage the key stakeholders and regulators?
• Are there procedures in place to get timely engagement of the Board to discuss emerging/current issues, consider scenarios, provide guidance and make decision?
• Does the framework ensure that the broader financial stability issues are considered in any actions relating to a participant suspension?
Box 2: Joint Supplementary Guidance– Vertically and Horizontally Integrated FMIs
Context
Consolidation, or integration, of FMI services may bring about benefits for merging FMIs; however it may also create new governance challenges. The PFMIs contain some general guidance regarding how FMIs should manage governance issues that arise in integrated entities. This note provides supplementary regulatory guidance for Canadian FMIs that either belong to an integrated entity or are considering consolidating with another entity to form one. The guidance applies to both vertically and horizontally integrated entities.
Vertical and horizontal integration in the context of FMIs
The PFMIs define a vertically integrated FMI group as one that brings together post-trade infrastructure providers under common ownership with providers of other parts of the value chain (for example, one entity owning and operating an exchange,
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CCP and SSS) and a horizontally integrated group as one that provides the same post-trade service offerings across a number of different products (for example, one entity offering CCP services for derivatives and cash markets).12 Examples are shown in Figure 1.
Figure 1: Examples of FMI integration in the value chain
a) Example of vertically integrated FMIs b) Example of horizontally integrated FMIs
Guidance within the PFMIs
The following text has been extracted directly from the PFMIs. The pertinent information is in bold italics.
PFMI paragraph 3.2.5:
Depending on its ownership structure and organisational form, an FMI may need to focus particular attention on certain aspects of its governance arrangements. An FMI that is part of a larger organisation, for example, should place particular emphasis on the clarity of its governance arrangements, including in relation to any conflicts of interests and outsourcing issues that may arise because of the parent or other affiliated organisation’s structure. The FMI’s governance arrangements should also be adequate to ensure that decisions of affiliated organisations are not detrimental to the FMI.13 An FMI that is, or is part of, a for-profit entity may need to place particular emphasis on managing any conflicts between income generation and safety.
PFMI paragraph 3.2.6:
An FMI may also need to focus particular attention on certain aspects of its risk-management arrangements as a result of its ownership structure or organisational form. If an FMI provides services that present a distinct risk profile from, and potentially pose significant additional risks to, its payment, clearing, settlement, or recording function, the FMI needs to manage those additional risks adequately. This may include separating the additional services that the FMI provides from its payment, clearing, settlement, and recording function legally, or taking equivalent action. The ownership structure and organisational form may also need to be considered in the preparation and implementation of the FMI’s recovery or wind-down plans or in assessments of the FMI’s resolvability.
Supplementary guidance for designated Canadian FMIs
An FMI that is part of a larger entity faces additional risk considerations compared to stand-alone FMIs. While there are potential benefits from integrating services into one large entity, including potential risk reduction benefits, integrated entities could face additional risks such as a greater degree of general business risk. Examples of how this could occur include the following:
• losses in one function may spill-over to the entity’s other functions;
12 CPMI-IOSCO 2010. “Market structure developments in the clearing industry: implications for financial stability.” CPMI-IOSCO Paper No 92. Available at: http://www.bis.org/publ/cpss92.htm. 13 If an FMI is wholly owned or controlled by another entity, authorities should also review the governance arrangements of that entity to see that they do not have adverse effects on the FMI’s observance of this principle.
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• the consolidated entity may face high combined exposures across its functions; and
• the consolidated entity may face exposures to the same participants across its functions.
For a more extensive discussion of potentially heightened risks that integrated FMIs may face, see CPMI, “Market structure developments in the clearing industry: implications for financial stability“ (2010).14
If an FMI belongs to a larger entity, or is considering consolidating with another entity, it should consider how its risk profile differs as part of the consolidated entity, and take appropriate measures to mitigate these risks.
In addition, FMIs that either belong to an integrated entity or are considering merging to form one should meet the following conditions.
1) Measures to protect critical FMI functions
• FMIs may be part of a larger consolidated entity. These FMIs must either:
o legally separate FMI-related functions15 from non-FMI-related functions performed by the consolidated entity in order to maximize bankruptcy remoteness of the FMI-related functions; or
o have satisfactory policies and procedures in place to manage additional risks resulting from the non-FMI-related functions appropriately to ensure the FMI’s financial and operational viability.
• If an FMI performs multiple FMI-related functions with distinct risk profiles within the same entity, the operator should effectively manage the additional risks that may result. The FMI should hold sufficient financial resources to manage the risks in all services it offers, including the combined or compounded risks that would be associated with offering the services through a single legal entity. If the FMI provides multiple services, it should disclose information about the risks of the combined services to existing and prospective participants to give an accurate understanding of the risks they incur by participating in the FMI. The FMI should carefully consider the benefits of offering critical services with distinct risk profiles through separate legal entities.
• If an FMI offers CCP services as part of its FMI-related functions, further conditions apply. CCPs take on more risk than other FMIs, and are inherently at higher risk of failure. Therefore, the FMI must either legally separate its CCP functions from other critical (non-CCP) FMI-related functions, or have satisfactory policies and procedures in place to manage additional risks appropriately to ensure the FMI’s financial and operational viability.
• Legal separation of critical functions is intended to maximize their bankruptcy remoteness and would not necessarily preclude integration of common organizational management activities such as IT and legal services across functions as long as any related risks are appropriately identified and mitigated.
2) Independence of governance and risk management
• FMIs and non-FMIs may have different corporate objectives and risk management appetites which could conflict at the parent level. For example, non-FMI-related functions, such as trading venues, are generally more focused on profit generation than risk management and do not have the same risk profile as FMI-related functions. A trading venue in a vertically integrated entity may benefit from increased participation in its service if its associated clearing function lessens its participation requirements.
• To mitigate potential conflicts, in particular the ability of other functions to negatively influence the FMI’s risk controls, each FMI subsidiary should have a governance structure and risk management decision-making process that is separate and independent from the other functions and should maintain an appropriate level of autonomy from the parent and other functions to ensure efficient decision making and effective management of any potential conflicts of interest. In addition, the consolidated entity’s broad governance arrangements should be reviewed to ensure they do not impede the FMI-related function’s observance of the CPMI-IOSCO principle on governance.
14 Available at http://www.bis.org/cpmi/publ/d92.pdf. 15 FMI-related functions are CCP, SSS, and CSD functions, including other aspects of clearing and settlement necessary to perform the CCP, SSS, and CDS functions (see the CPMI-IOSCO glossary definitions of “clearing” and “settlement”, available at http://www.bis.org/cpmi/publ/d00b.pdf).
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3) Comprehensive management of risks
• Although risk management governance and decision-making should remain independent, it is nonetheless necessary that the consolidated entity is able to manage risk appropriately across the entity. At a consolidated level, the entity should have an appropriate risk management framework that considers the risks of each subsidiary and the additional risks related to their interdependencies.
• An FMI should identify and manage the risks it bears from and poses to other entities as a result of interdependencies. Consolidated FMIs should also identify and manage the risks they pose to one another as a result of their interdependencies. Consolidated FMIs may have exposures to the same participants, liquidity providers, and other critical service providers across products, markets and/or functions. This may increase the entity’s dependence on these providers and may heighten the systemic risk associated with the consolidated entity compared to a stand-alone FMI. Where possible, the consolidated entity and its FMIs should consider ways to mitigate risks arising from shared dependencies. The consolidated entity and its FMIs should also consider conducting entity-wide operational risk testing related to identifying and mitigating these risks.
4) Sufficient capital to cover potential losses
• Consolidated entities face the risk that a single participant defaults in more than one subsidiary simultaneously. This could result in substantial losses for the consolidated entity which will then also need to replenish resources for the FMIs to continue to operate. FMIs should consider such risks in developing their resource replenishment plan.
• Consolidated entities may face higher or lower business risk than individual FMIs depending on size, complexity and diversification across affiliates. Consolidated entities should consider these impacts in their general business risk profiles and in determining the appropriate level of liquid assets needed to cover their potential general business losses.16
– Standard 5: Collateral
Box 3: Joint Supplementary Guidance – Collateral
Context
The PFMIs establish the form and attributes of collateral that an FMI holds to manage its own credit exposures or those of its participants. This note provides additional guidance for Canadian FMIs to meet the components of the collateral principle related to: (i) acceptance of collateral with low credit, liquidity and market risk; (ii) concentrated holdings of certain assets; and (iii) calculating haircuts. In certain circumstances, regulators may allow exceptions to the collateral policy on a case-by-case basis if the FMI demonstrates that the risks can be adequately managed.
(i) Acceptable collateral
The following text has been extracted directly from the PFMIs, from Principle 5 - Key Considerations 1 and 4:
An FMI should conduct its own assessment of risks when determining collateral eligibility. In general, collateral held to manage the credit exposures of the FMI or those of its participants should have minimal credit, liquidity and market risk, even in stressed market conditions. However, asset categories with additional risk may be accepted when subject to conservative haircuts and adequate concentration limits.
The following clarifies regulators’ expectations on what is acceptable collateral by specifying:
1) minimum requirements for all assets that are acceptable as collateral;
2) the asset categories that are judged to have minimal credit, liquidity and market risk; and
3) additional asset categories that could be acceptable as collateral if subject to conservative haircuts and concentration
16 Liquid assets held for general business losses must be funded by equity (such as common stock, disclosed reserves, or retained earnings) rather than debt.
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limits.
1) An FMI should conduct its own internal assessment of the credit, liquidity and market risk of the assets eligible as collateral. The FMI should review its collateral policy at least annually, and whenever market factors justify a more frequent review. At a minimum, acceptable assets should:
i) be freely transferable without legal, regulatory, contractual or any other constraints that would impair liquidation in a default;
ii) be marketable securities that have an active outright sale market even in stressed market conditions;
iii) have reliable price data published on a regular basis;
iv) be settled over a securities settlement system compliant with the Principles; and
v) be denominated in the same currency as the credit exposures being managed, or in a currency that the FMI can demonstrate it has the ability to manage.
An FMI should not rely only on external opinions to determine what acceptable collateral is. The FMI should conduct its own assessment of the riskiness of assets, including differences within a particular asset category, to determine whether the risks are acceptable. Since the primary purpose of accepting collateral is to manage the credit exposures of the FMI and its participants, it is paramount that assets eligible as collateral can be liquidated for fair value within a reasonable time frame to cover credit losses following a default. The annual review of the FMI’s collateral policy provides an opportunity to assess whether risks continue to be adequately managed. Owing to the dynamic nature of capital markets, the FMI should monitor changes in the underlying risk of the specific assets accepted as collateral, and should adjust its collateral policy in the interim period between annual reviews, when required.
At a minimum, an asset should have certain characteristics in order to provide sufficient assurance that it can be liquidated for fair value within a reasonable time frame. These characteristics relate primarily to the FMI’s ability to reliably sell the asset as required to manage its credit exposures. The asset should be unencumbered, that is, it must be free of legal, regulatory, contractual or other restrictions that would impede the FMI’s ability to sell it. The challenges associated with selling or transferring non-marketable assets, or those without an active secondary market, preclude their acceptance as collateral.
2) Assets generally judged to have minimal credit, liquidity and market risk are the following:
i) cash;
ii) securities issued or guaranteed by the Government of Canada;17
iii) securities issued or guaranteed by a provincial government; and
iv) securities issued by the U.S. Treasury.
In general, the assets judged to have minimal risk are cash and debt securities issued by government entities with unique powers, such as the ability to raise taxes and set laws, and that have a low probability of default. Total Canadian debt outstanding is currently dominated by securities issued or guaranteed by the Government of Canada and by provincial governments. The relatively large supply of securities issued by these entities and their generally high creditworthiness contribute to the liquidity of these assets in the domestic capital market. Securities issued by the U.S. Treasury are also deemed to be of high quality for the same reasons. The overall riskiness of securities issued by the Government of Canada and the U.S. Treasury is further reduced by their previous record of maintaining value in stressed market conditions, when they tend to benefit from a “flight to safety.”
It is essential that an FMI regularly assesses the riskiness of even the specific high-quality assets identified in this section to determine their adequacy as eligible collateral. In some cases, only certain assets within the more general asset category may be deemed acceptable.
17 Guarantees include securities issued by federal and provincial Crown corporations or other entities with an explicit statement that debt issued by the entity represents the general obligations of the sovereign.
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3) An FMI should consider its own distinct arrangements for allocating credit losses and managing credit exposures when accepting a broader range of assets as collateral. The following asset classes may be acceptable as collateral if they are subject to conservative haircuts and concentration limits:
i) securities issued by a municipal government;
ii) bankers’ acceptances;
iii) commercial paper;
iv) corporate bonds;
v) asset-backed securities that meet the following criteria: (1) sponsored by a deposit-taking financial institution that is prudentially regulated at either the federal or provincial level, (2) part of a securitization program supported by a liquidity facility , and (3) backed by assets of an acceptable credit quality;
vi) equity securities traded on marketplaces regulated by a member of the CSA and the Investment Industry Regulatory Organization of Canada; and
vii) other securities issued or guaranteed by a government, central bank or supranational institution classified as Level 1 high-quality assets by the Basel Committee on Banking Supervision.
An FMI should take into account its specific risk profile when assessing whether accepting certain assets as collateral would be appropriate. The decision to broaden the range of acceptable collateral should also consider the size of collateral holdings to cover the credit exposures of the FMI relative to the size of asset markets. In cases where the total collateral required to cover credit exposures is small compared with the market for high-quality assets, there is less potential strain on participants to meet collateral requirements.
Accepting a broader range of collateral has certain advantages. Most importantly, it provides participants with more flexibility to meet the FMI’s collateral requirements, which may be especially important in stressed market conditions. A broader range of collateral diversifies the risk exposures faced by the FMI, since it may be easier to liquidate diversified collateral holdings when liquidity unexpectedly dries up for a particular asset class. It also diversifies market risk by reducing potential exposure to idiosyncratic shocks. Accepting a broader range of assets recognizes the increased cost to market participants of posting only the highest-quality assets, as well as the increasing encumbrance of these assets in order to meet new regulatory standards.18
(ii) Concentration Limits
The following text has been extracted directly from the PFMIs, from Principle 5 - Key Considerations 1 and 4:
An FMI should avoid concentrated holding of assets where this could potentially introduce credit, market and liquidity risk beyond acceptable levels. In addition, the FMI should mitigate specific wrong-way risk by limiting the acceptance of collateral that would likely lose value in the event of a participant default, and prevent participants from posting assets they or their affiliates have issued. The FMI should measure and monitor the collateral posted by participants on a regular basis, with more frequent analysis required when more flexible collateral policies have been implemented.
The following points clarify regulators’ expectations regarding the composition of collateral accepted by an FMI by specifying:
1) broad limits for riskier asset classes to mitigate concentration risk;
2) targeted limits for securities issued by financial sector entities to mitigate specific wrong-way risk; and
3) the level of monitoring required for collateral posted by participants.
1) An FMI should limit assets from the broader range of acceptable assets identified in section (i)3) to a maximum of 40 per cent of the total collateral posted from each participant. Within the broader range of acceptable assets, the FMI should consider implementing more specific concentration limits for different asset categories.
18 The encumbrance of high-quality assets is expected to increase through a number of regulatory reforms, including Basel III, over-the- counter derivatives reform and the Principles.
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An FMI should limit securities issued by a single issuer from the broader range of acceptable assets to a maximum of 5 per cent of total collateral from each participant.
The guidance limits the acceptance of collateral from the broader range of assets to a maximum of 40 per cent because a higher proportion could potentially create unacceptable risks to FMIs and their participants. This limit is currently applied to the Bank’s Standing Liquidity Facility and the Liquidity Coverage Ratio under Basel III. The benefits of expanding collateral―namely, providing participants with more flexibility and achieving greater diversification―are achieved within the limit of 40 per cent, with collateral in excess of this limit increasing the overall risk exposures with less benefit. In some circumstances, regulators may permit an FMI to accept more than 40 per cent of total collateral from the broader range of assets if the risk from a particular participant is low. Employing a limit of 5 per cent of total collateral for securities issued by a single issuer is a prudent measure to limit exposures from idiosyncratic shocks. It also reduces the need for procyclical adjustments to collateral requirements following a decline in value.
An FMI should consider implementing more stringent concentration limits, as well as imposing limits on certain asset categories, depending on the FMI’s specific arrangements for managing credit exposures. The considerations described in section (i) 3) for accepting a broader range of assets as collateral apply equally to the decision over whether more stringent concentration limits should be implemented.
2) An FMI should limit the collateral from financial sector issuers to a maximum of 10 per cent of total collateral pledged from each participant. The FMI should not allow participants to post their own securities or those of their affiliates as collateral.
An FMI is exposed to specific wrong-way risk when the collateral posted is highly likely to decrease in value following a participant default. It is highly likely that the value of debt and equity securities issued by companies in the financial sector would be adversely affected by the default of an FMI participant, introducing wrong-way risk. This is especially the case for interconnected FMI participants with activities that are concentrated in domestic financial markets. Implementing a limit on financial sector issuers mitigates potential risk exposures from specific wrong-way risk. More stringent limits should be implemented where appropriate.
3) In cases where only the highest-quality assets are accepted, an FMI is required to measure and monitor the collateral posted by participants during periodic evaluations of participant creditworthiness. The FMI should measure and monitor the correlation between a participant’s creditworthiness and the collateral posted more frequently when a broader range of collateral is accepted. The FMI should have the ability to adjust the composition and to increase the collateral required from participants experiencing a reduction in creditworthiness.
When only the highest-quality assets are accepted as collateral, there is less risk associated with the composition of collateral posted by a participant; hence, such risk does not need to be monitored as closely. The FMI should monitor the composition of collateral pledged by participants more frequently when riskier assets are eligible, since such assets are more likely to be correlated with the participant’s creditworthiness. FMIs should also consider the general credit risk of their participants when deciding how frequently monitoring should be conducted. In all circumstances, the FMI should have the contractual and legal ability to unilaterally require more collateral and to request higher-quality collateral from a participant that is judged to present a greater risk.
(iii) Haircuts
The following text has been extracted directly from the PFMIs, from Principle 5 - Key Considerations 2 and 3:
An FMI should establish stable and conservative haircuts that consider all aspects of the risks associated with the collateral. An FMI should evaluate the performance of haircuts by conducting backtesting and stress testing on a regular basis.
The following points clarify regulators’ expectations regarding the calculation and testing of haircuts by outlining:
1) requirements for calculating haircuts; and
2) requirements for testing the adequacy of haircuts and overall collateral accepted.
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1) An FMI should apply stable and conservative haircuts that are calibrated against stressed market conditions. When the same haircut is applied to a group of securities, it should be sufficient to cover the riskiest security within the group. Haircuts should reflect both the specific risks of the collateral accepted and the general risks of an FMI’s collateral policy.
Including periods of stressed market conditions in the calibration of haircuts should increase the haircut rate. In addition to representing a conservative approach, this helps to mitigate the risk of a procyclical increase in haircuts during a period of high volatility. Typically, FMIs group similar securities by shared characteristics for the purposes of calculating haircuts (e.g., Government of Canada bonds with similar maturities). An FMI should recognize the different risks associated with each individual security by ensuring that the haircut is sufficient to cover the security with the most risk within each group. Haircuts should always account for all of the specific risks associated with each asset accepted as collateral. However, the FMI should also consider the portfolio risk of the total collateral posted by a participant; the FMI may consider employing deeper haircuts for concentration and wrong-way risk above certain thresholds.
2) An FMI should perform backtesting of its collateral haircuts on at least a monthly basis, and conduct a more thorough review of haircuts quarterly. The FMI’s stress tests should take into account the collateral posted by participants.
FMIs are expected to calculate stable and conservative haircuts by considering stressed market conditions. In general, including stressed market conditions in the calibration of haircuts should provide a high level of coverage that does not require continuous testing and verification. Nonetheless, backtesting on a monthly basis allow the adequacy of haircuts to be evaluated against observed outcomes. A quarterly review of haircuts balances the objective of stable haircuts with the need to adjust haircuts as required. Including changes to collateral values as part of stress testing provides a more accurate assessment of potential losses in a default scenario.
– Standard 7: Liquidity risk
Box 4: Joint Supplementary Guidance – Liquidity Risk
Context
The PFMIs define liquidity risk as risk that arises when the FMI, its participants or other entities cannot settle their payment obligations when due as part of the clearing or settlement process. This note provides additional guidance for Canadian FMIs to meet the components of the liquidity-risk principle related to: (i) maintaining sufficient liquid resources and (ii) qualifying liquid resources.
(i) Maintaining sufficient liquid resources
The following text has been extracted directly from the PFMIs, from Principle 7 - Key Considerations 3, 5, 6 and 9:
An FMI should maintain sufficient qualifying liquid resources to cover its liquidity exposures to participants with a high degree of confidence. An FMI should maintain additional liquid resources sufficient to cover a wide range of potential stress scenarios that should include, but not be limited to, the default of the participant and its affiliates that would generate the largest aggregate liquidity obligation for the FMI in extreme but plausible conditions. Liquidity stress testing should be performed on a daily basis. An FMI should verify that its liquid resources are sufficient through comprehensive stress testing conducted at least monthly.
The information provided in this section clarifies regulators’ expectations of sufficient qualifying liquid resources by specifying:
1 the degree of confidence required to cover liquidity exposures;
2) the total liquid resources that should be maintained; and
3) how the FMI should verify that its liquid resources are sufficient and adjust liquid resources when necessary.
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1) Qualifying liquid resources should meet an established single-tailed confidence level of at least 97 per cent 19 with respect to the estimated distribution of potential liquidity exposures. The FMI should have an appropriate method for estimating potential exposures that accounts for the design of the FMI and other relevant risk factors.
The guidance requires a high threshold for covering liquidity exposures with qualifying liquid resources, while also considering the expense associated with obtaining these resources. A 97 per cent degree of confidence is equivalent to less than one observation per month (on average) in which a liquidity exposure is greater than the FMI’s qualifying liquid resources. However, if it is to meet the required threshold, the FMI should estimate its potential liquidity exposures accurately. The FMI should account for all relevant predictive factors when estimating potential exposures. While historical exposures are expected to form the basis of estimated potential exposures, the FMI should account for the impact of new products, additional participants, changes in the way transactions settle or other relevant market- risk factors.
2a) An FMI should maintain additional liquid resources that are sufficient to cover a wide range of potential stress scenarios. Total liquid resources should cover the FMI’s largest potential exposure under a variety of extreme but plausible conditions. The FMI should have a liquidity plan that justifies the use of other liquid resources and provides the supporting rationale for the total liquid resources that it maintains.
The guidance requires that total liquid resources be determined by the largest potential exposure in extreme but plausible conditions. This implies maintaining total liquid resources sufficient to cover at least the FMI’s largest observed liquidity exposures, but the liquidity resources would likely be larger, based on an assessment of potential
liquidity exposures in extreme but plausible conditions. The FMI’s liquidity plan should explain why the FMI’s estimated largest potential exposure is an accurate assessment of the FMI’s liquidity needs in extreme but plausible conditions, thereby demonstrating the adequacy of the FMI’s total liquid resources.
It is permissible for an FMI to manage this risk in part with other liquid resources because it may be prohibitively expensive, or even impossible, for the FMI to obtain sufficient qualifying liquid resources. FMIs face increased risk from liquid resources that do not meet the strict definition of “qualifying,” and thus an FMI should include in its liquidity plan a clear explanation of how these resources could be used to satisfy a liquidity obligation. This additional explanation is warranted in all cases, even when the FMI’s dependence on other liquid resources is minimal.
2b) When applicable, the possibility that a defaulting participant is also a liquidity provider should be taken into account.
Generally, the liquidity providers for Canadian FMIs are also participants in the FMI. When a defaulting participant is also a liquidity provider, it is important that the FMI’s liquidity facilities are arranged in such a way that it has sufficient liquidity. To do so, the FMI should either have additional liquid resources or negotiate a backup liquidity provider, so that the FMI has sufficient liquidity (as specified in this guidance) in the event that one of its liquidity providers defaults.
3) FMIs should perform liquidity stress testing on a daily basis to assess their liquidity needs. At least monthly, FMIs should conduct comprehensive stress tests to verify the adequacy of their total liquid resources and to serve as a tool for informing risk management. Stress-testing results should be reviewed by the FMI’s risk- management committee and reported to regulators on a regular basis.
FMIs should have clear procedures to determine whether their liquid resources are sufficient and to adjust their available liquid resources when necessary. A full review and potential resizing of liquid resources should be completed at least annually.
The annual validation of an FMI’s model for managing liquidity risk should determine whether its stress testing follows best practices and captures the potential risks faced by the FMI.
FMIs should assess their liquidity needs through stress testing that includes the measurement of the largest daily liquidity exposure that they face. FMIs should also conduct stress testing to verify whether their liquid resources are sufficient to cover potential liquidity exposures under a wide range of stress scenarios. An annual full review and potential resizing of liquid resources provides adequate time to negotiate with liquidity providers. While it may be impractical for FMIs to frequently obtain additional liquid resources, it is important that FMIs clearly define the
19 A “potential liquidity exposure” is defined as the estimated maximum daily liquidity needs resulting from the market value of the FMI’s payment obligations under normal business conditions. FMIs should consider potential liquidity exposures over a rolling one-year time frame.
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circumstances requiring prompt adjustment of their available liquid resources, and have a reliable plan for doing so. Establishing clear procedures provides transparency regarding an FMI’s decision-making process and prevents the FMI from delaying required increases in liquid resources beyond what is reasonably acceptable. The review of stress- testing results by the FMI’s risk-management committee provides additional assurance that liquid resources are sufficient, and whether an interim resizing is necessary. Reporting results to regulators on a monthly basis allows for timely intervention if liquid resources have been deemed inadequate.
Comprehensive stress testing should also encompass a broad range of stress scenarios, not just to verify whether the FMI’s liquid resources are sufficient, but also to identify potential risk factors. Reverse stress testing, more extreme stress scenarios, valuation of liquid assets and focusing on individual risk factors (e.g., available collateral) all help to inform the FMI of potential risks. The annual validation of the FMI’s risk-management model enables it to fully assess the appropriateness of the stress scenarios conducted and the procedures for adjusting liquid resources.
(ii) Qualifying liquid resources
The following text has been extracted directly from the PFMIs, from Principle 7 - Key Considerations 4, 5 and 6:
Qualifying liquid resources should be highly reliable and have same-day availability. Liquid resources are reliable when the FMI has near certainty that the resources it expects will be available when required. Qualifying liquid resources should be available on the same day that they are needed by the FMI to meet any immediate liquidity obligation (e.g., a participant’s default). Qualifying liquid resources that are denominated in the same currency as the FMI’s exposures count toward its minimum liquid-resource requirement.
The following section clarifies regulators’ expectations as to what is considered a qualifying liquid resource by:
1) identifying the assets in the possession, custody or control of the FMI that are considered qualifying liquid resources; and
2) setting clear standards for liquidity facilities to be considered qualifying liquid resources, including more-stringent standards for uncommitted liquidity facilities.
1) Cash and treasury bills20 in the possession, custody or control of an FMI are qualifying liquid resources for liquidity exposures denominated in the same currency.21
Cash held by an FMI does not fluctuate in value and can be used immediately to meet a liquidity obligation, thereby satisfying the criteria for liquid resources to be highly reliable and available on the same day.22 Treasury bills issued by the Government of Canada or the U.S. Treasury also meet the definition of a qualifying liquid resource. By market convention, sales of treasury bills settle on the same day, allowing funds to be obtained immediately, whereas other bonds can settle as late as three days after the date of the trade. Treasury bills can also be transacted in larger sizes with less market impact than most other bonds. In addition, the shorter-term nature of treasury bills makes them more liquid than other securities during a crisis (i.e., they benefit from a “flight to liquidity”). Thus, there is a high degree of certainty that the FMI would obtain liquid resources in the amount expected following the sale of treasury bills.
2a) Committed liquidity facilities are qualifying liquid resources for liquidity exposures denominated in the same currency if the following criteria are met:
i) facilities are pre-arranged and fully collateralized;
ii) there is a minimum of three independent liquidity providers;23 and
iii) the FMI conducts a level of due diligence that is as stringent as the risk assessment completed for FMI participants.
For liquidity facilities to be considered reliable, an FMI should have near certainty that the liquidity provider will
20 “Treasury bills” refers to bonds issued by the Government of Canada and the U.S. Treasury with a maturity of one year or less. 21 This section refers to unencumbered assets free of legal, regulatory, contractual or other restrictions on the ability of the FMI to liquidate, sell, transfer or assign the asset. 22 “Cash” refers to currency deposits held at the issuing central bank and at creditworthy commercial banks. “Value” in this context refers to the nominal value of the currency. 23 The Liquidity providers should not be affiliates to be considered independent.
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Request for Comments
honour its obligation. Pre-arranged liquidity facilities provide clarity on terms and conditions, allowing greater certainty regarding the obligations and risks of the liquidity providers. Pre- arranged facilities also reduce complications associated with obtaining liquidity, when required. Furthermore, a liquidity provider is most likely to honour its obligations when lending is fully collateralized. Therefore, only the amount that is collateralized will be considered a qualifying liquid resource. A liquidity facility is more reliable when the risk of non-performance is not concentrated in a single institution. By having at least three independent liquidity providers, the FMI would continue to diversify its risks should even a single provider default. To monitor the continued reliability of a liquidity facility, the FMI should assess its liquidity providers on an ongoing basis. In this respect, an FMI’s risk exposures to its liquidity providers are similar to the risks posed to it by its participants. Therefore, it is appropriate for the FMI to conduct comparable evaluations of the financial health of its liquidity providers to ensure that the providers have the capacity to perform as expected.
2b) Uncommitted liquidity facilities are considered qualifying liquid resources for liquidity exposures in Canadian dollars if they meet the following additional criteria:
i) the liquidity provider has access to the Bank of Canada’s Standing Liquidity Facility (SLF);
ii) the facility is fully collateralized with SLF-eligible collateral; and
iii) the facility is denominated in Canadian dollars.
More-stringent standards are warranted for uncommitted facilities because a liquidity provider’s incentives to honour its obligations are weaker. However, the risk that the liquidity provider will be unwilling or unable to provide liquidity is reduced by the requirement that it needs to be a direct participant in the Large Value Transfer System and that the collateral be eligible for the Standing Liquidity Facility (SLF). This is because the collateral obtained from the FMI in exchange for liquidity can be pledged to the Bank of Canada under the SLF. This option significantly reduces the liquidity pressures faced by the liquidity provider that could interfere with its ability to perform on its obligations. A facility in a foreign currency would not qualify because the Bank does not lend in currencies other than the Canadian dollar. The increased reliability of liquidity providers with access to routine credit from the central bank is recognized explicitly within the PFMIs.
– Standard 15: General business risk
Box 5: Joint Supplementary Guidance – General Business Risk
Context
The PFMIs define general business risk as any potential impairment of the financial condition (as a business concern) of an FMI owing to declines in its revenue or growth in its expenses, resulting in expenses exceeding revenues and a loss that must be charged against capital. These risks arise from an FMI’s administration and operation as a business enterprise. They are not related to participant default and are not covered separately by financial resources under the Credit or Liquidity Risk Principles. To manage these risks, the PFMIs state that FMIs should identify, monitor and manage their general business risk and hold sufficient liquid net assets funded by equity to cover potential general business losses. This note provides additional guidance for Canadian FMIs to meet the components of the general business risk principle related to: (i) governing general business risk; (ii) determining sufficient liquid net assets; and (iii) identifying qualifying liquid net assets. It also establishes the associated timelines and disclosure requirements.
(i) Governance of general business risk
Principle 15, Key Consideration 1 of the PFMIs states:
An FMI should have robust management and control systems to identify, monitor, and manage general business risk.
The following points clarify the authorities’ expectations on how an FMI’s governance arrangements should address general business risk.
An FMI’s Board of Directors should be involved in the process of identifying and managing business risks.
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Request for Comments
Management of business risks should be integrated within an FMI’s risk-management framework, and the Board of Directors should be responsible for determining risk tolerances related to business risk and for assigning responsibility for the identification and management of these risks. These risk tolerances and the process for the identification and management of business risk should be the foundation for the FMI’s business risk-management policy. Based on the PFMIs, the policies and procedures governing the identification and management of business risk should meet the standards outlined below.
• The FMI’s business risk-management policy should be approved by the Board of Directors and reviewed at least annually. The policy should be consistent with the Board’s overall risk tolerance and risk-management strategy.
• The Board’s Risk Committee should have a role in advising the Board on whether the business risk-management policy is consistent with the FMI's general risk-management strategy and risk tolerance.
• The business risk-management policy should provide clear responsibilities for decision making by the Board, and assign responsibility for the identification, management and reporting of business risks to management.
(ii) Determining sufficient liquid net assets
Principle 15, Key Consideration 2 of the PFMIs states:
An FMI should hold liquid net assets funded by equity […] so that it can continue operations and services as a going concern if it incurs general business losses. The amount of liquid net assets funded by equity an FMI should hold should be determined by its general business risk profile and the length of time required to achieve a recovery or orderly wind-down, as appropriate, of its critical operations and services if such action is taken.
Principle 15, Key Consideration 3 of the PFMIs states:
An FMI should maintain a viable recovery or orderly wind-down plan and should hold sufficient liquid net assets funded by equity to implement this plan. At a minimum, an FMI should hold liquid net assets funded by equity equal to at least six months of current operating expenses.
The following points clarify the authorities’ expectations on how FMIs should calculate their sufficient liquid net assets:
Until guidance for recovery planning and for calculating the associated costs is completed, FMIs are required to hold liquid net assets to cover a minimum of six months of current operating expenses.
In calculating current operating expenses, FMIs will need to:
• Assess and understand the various general business risks they face to allow them to estimate as accurately as possible the required amount of liquid net assets. These estimates should be based on financial projections, which take into consideration, for example, past loss events, anticipated projects and increased operating expenses.
• Restrict the calculation to ongoing expenses. FMIs will need to adjust their operating costs such that any extraordinary expenses (i.e., unessential, infrequent or one-off costs) are excluded. Typically, operating costs include both fixed costs (e.g., premises, IT infrastructure, etc.) and variable costs (e.g., salaries, benefits, research and development, etc.).
• Assess the portion of staff from each corporate department required to ensure the smooth functioning of the FMI during the six-month period. The calculation of operating expenses would include some indirect costs. FMIs would require not only dedicated operational staff, but also various supporting staff. These could include (but are not limited to) staff from the FMI’s Legal, IT and HR departments or staff required to ensure the continued functioning of other FMIs that could be necessary to support the FMI.
To fully observe Principle 15, FMIs must hold sufficient liquid assets to cover the greater of (i) funds required for FMIs to implement their recovery or wind-down; or (ii) six months of current operating expenses. In the interim, until recovery planning guidance is published, only the latter amount will apply.
The amount of liquid net assets required to implement an FMI’s recovery or wind-down plans will depend on the scenarios or tools available to the FMI. The acceptable recovery and orderly wind-down plans for Canadian FMIs will be articulated by the authorities in forthcoming guidance. Once this guidance on recovery planning has been developed, the guidance on general business risk will be updated to provide FMIs with additional clarity on how to calculate the costs associated with these plans and determine the amount of liquid net assets required.
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Request for Comments
(iii) Qualifying liquid net assets
Explanatory Note 3.15.5 of the PFMIs states:
An FMI should hold liquid net assets funded by equity (such as common stock, disclosed reserves or other retained earnings) so that it can continue operations and services as a going concern if it incurs general business losses. Equity allows an FMI to absorb losses on an ongoing basis and should be permanently available for this purpose.
Principle 15, Key Consideration 4 of the PFMIs states:
Assets held to cover general business risk should be of high quality and sufficiently liquid to allow the FMI to meet its current and projected operating expenses under a range of scenarios, including in adverse market conditions.
Principle 15, Key Consideration 3 of the PFMIs states:
These assets are in addition to resources held to cover participant defaults or other risks covered under the financial resources principles.
The following points clarify the authorities’ expectations on which assets qualify to be held against general business risk, and how these assets should be held to ensure that they are permanently available to absorb general business losses.
Assets held against general business risk should be of high quality and sufficiently liquid, such as cash, cash equivalents and liquid securities.
Authorities have developed regulatory guidance related to managing liquidity and investment risks, which provides additional clarity on the definition of cash equivalents and liquid securities, respectively.
• Cash equivalents – are considered to be treasury bills24 issued by either the Canadian or U.S. federal governments. As noted in the liquidity guidance, by market convention, sales of treasuries settle on the same day, allowing funds to be obtained immediately, whereas other bonds can settle as late as three days after the trade date.
• Liquid securities – for the purposes of general business risk, liquid securities are defined by the financial instruments criteria listed in the guidance on the Investment Risk Principle. These criteria outline financial instruments considered to have minimal credit, market, and liquidity risk.
Liquid net assets must be held at the level of the FMI legal entity to ensure that they are unencumbered and can be accessed quickly. Liquid net assets may be pooled with assets held for other purposes, but must be clearly identified as held against general business risk.
FMIs may need to accumulate liquid net assets for purposes other than to meet the General Business Risk Principle. However, assets held against general business risk cannot be used to cover participant default risk or any other risks covered by the financial resources principles.
Liquid net assets can be pooled with assets held for other purposes, but must be clearly identified as held against general business risk in the FMI’s reports to its regulators.
(iv) Timelines for assessing and reporting the level of liquid net assets
Explanatory Note 3.15.8 of the PFMIs states:
To ensure the adequacy of its own resources, an FMI should regularly assess and report its liquid net assets funded by equity relative to its potential business risks to its regulators.
The following clarifies the authorities’ expectations of the frequency with which FMIs should assess and report their required level of liquid net assets.
FMIs should report to authorities the amount of liquid net assets held against business risk annually, at a minimum.
24 Treasury bills refer to short-term (i.e., maturity of one year or less) debt instruments issued by the Canadian or U.S. federal government.
November 27, 2014 (2014), 37 OSCB 10563
Request for Comments
An FMI should report to the authorities the amount of liquid net assets funded by equity held exclusively against business risk and quantify its business risks as major developments arise, or at least on an annual basis. This report should include an explanation of the methodology used to assess the FMI’s business risks and to calculate its requirements for liquid net assets.
FMIs should recalculate the required amount of liquid net assets annually, at a minimum.
Once FMI operators have established the amount of liquid net assets required to cover six months of operating expenses, FMIs should recalculate the required amount of liquid net assets as major developments occur, or annually, at a minimum. Once the authorities have provided further guidance on recovery and FMIs have developed recovery plans, FMIs should also evaluate the need to increase the amount of liquid net assets they should hold to meet the General Business Risk Principle.
To establish clear procedures that improve transparency regarding an FMI’s decision-making process and to prevent the FMI from delaying required increases in liquid resources beyond what is reasonably acceptable, FMIs should maintain a viable capital plan for raising additional acceptable resources should these resources fall close to or below the amount needed. This plan should be approved by the Board of Directors and updated annually, or as major developments occur.
FMIs should review their methodology for calculating the required level of liquid net assets at least once every five years, or as major developments occur.25
The methodology for calculating the amount of required liquid net assets should be reviewed at least every five years to ensure that the calculation remains relevant over time.
– Standard 16: Custody and investment risks
Box 6: Joint Supplementary Guidance – Custody and Investment Risks
Context
The PFMIs define investment risk as the risk faced by an FMI when it invests its own assets or those of its participants.
• An FMI holds assets for a variety of purposes, some of which are referred to specifically in the PFMIs: to cover its business risk (Principle 15), to cover credit losses (Principle 4) and to cover credit exposures (Principle 6) using the collateral pledged by participants.
• An FMI may also hold financial assets for purposes not directly related to the risk management issues addressed within the PFMIs (e.g., employee pensions, general investment assets).
An FMI’s strategy for investing assets should be consistent with its overall risk-management strategy (Principle 16). The purpose of this note is to provide further guidance on regulators’ expectations regarding the management of investment risk. This guidance helps to ensure that an FMI’s investments are managed in a way that protects the financial soundness of the FMI and its participants.26
(i) Governance
The PFMIs state that the Board of Directors is responsible for overseeing the risk-management function and approving material risk decisions. An FMI should develop an investment policy to manage the risk arising from the investment of its own assets and those of its participants.
• The FMI’s investment policy should be approved by the Board and reviewed at least annually. The policy should be consistent with the Board’s overall risk tolerance and considered part of the FMI’s risk-management framework.
25 In the context of this specific guidance item, “major developments” refers to the major changes to operations, product and service offerings, or classes of participation. 26 This guidance on investment risk is based on aspects of Principle 2 – Governance, Principle 3 – Comprehensive Framework for the Management of Risk, and Principle 16 – Custody and Investment Risk.
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Request for Comments
• The Risk Committee should advise the Board on whether the investment policy is consistent with the FMI's general risk-management strategy and risk tolerance.
• The Board should assess the advantages and disadvantages of managing assets internally or outsourcing them to an external manager. The FMI retains full responsibility for any actions taken by its external manager.
• The FMI should establish criteria for the selection of an external manager.27
The FMI’s investment policy should clearly identify those who are accountable for investment performance. The investment policy should also:
• Provide a clear explanation of the Board’s delegated responsibility for investment decision making.
• Specify clear responsibilities for monitoring investment performance (against established benchmarks) and risk exposures (against limits or constraints). Procedures should be established to ensure that appropriate actions are taken when breaches occur, including possible reporting to the Board.
• Investment performance and key risk metrics should be reported to the Board at least quarterly.28
(ii) Investment strategy
The investment strategy chosen by an FMI should not allow the pursuit of profit to compromise its financial soundness. As outlined below, additional consideration should be given to the investment strategy governing assets held specifically for risk- management purposes (i.e. Principle 4-7 and Principle 15).
Investment objectives
The investment policy should include appropriate investment objectives for the various assets held for risk- management purposes. The stated expected return and risk tolerance of the investment objectives should reflect the:
• specific purpose of the assets;
• relative importance of the assets in the overall risk management of the FMI; and
• requirement within the PFMIs for FMIs to invest in instruments with minimal credit, market and liquidity risk (see the Appendix for the minimum standards of acceptable instruments).
The investment objectives should also help to determine the appropriate benchmarks for measuring investment performance.
Investment constraints
The importance of assets held for risk-management purposes warrants the use of investment constraints. It is paramount that an FMI have prompt access to these assets with minimal price impact to avoid interference with their primary use for risk management. Investment of these assets should, at a minimum, observe the following:
• To reduce concentration risk, no more than 20 per cent of total investments should be invested in municipal and private sector securities. Investment in a single private sector or municipal issuer should be no more than 5 per cent of total investments.
• To mitigate specific wrong-way risk, investments should, as much as possible, be inversely related to market events that increase the likelihood of those assets being required. Investment in financial sector securities should be no more than 10 per cent of total investments. An FMI should not invest assets in the securities of its own affiliates. An FMI is not permitted to reinvest participant assets in a participant’s own securities or those of its affiliates, as specified in Principle 16.
27 At a minimum, external managers should have demonstrated past performance and expertise, as well as strong risk-management practices such as an internal audit function and processes to protect and segregate the FMI’s assets. 28 Investment performance may also be reported to a Board committee with special expertise to which the Board has delegated the authority to review investment performance (e.g., an Investment Committee).
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Request for Comments
• For investments that are subject to counterparty credit risk, an FMI should set clear criteria for choosing investment counterparties and setting exposure limits.
The investment constraints should be clearly stated in the investment policy in order to provide clear guidance for those responsible for investment decision making.29
Link to risk management
FMIs should account for the implications of investing assets on their broader risk-management practices. The following issues should be considered when investing assets held for risk management purposes:
• An FMI’s process for determining whether sufficient assets are available for risk management should account for potential investment losses. For example, investing the assets available to a CCP to cover losses from a participant default could lose value in a default scenario, resulting in less credit-risk protection. An FMI should hold additional assets to cover potential losses from its investments held for risk-management purposes.
• An FMI should account for the implications of investing assets on its ability to effectively manage liquidity risk. In particular, identification of the FMI’s available liquid resources should account for the investment of its own and participants’ assets. For example, cash held at a creditworthy commercial bank would no longer be considered a qualifying liquid resource under Principle 7 if it were invested in the debt instrument of a private sector issuer.
• The investment of an FMI’s own assets and those of its participants should not circumvent related risk management requirements. For example, the reinvestment of participants’ collateral should still respect the FMI’s collateral concentration limits applicable to those assets.
Appendix
For the purposes of Principle 16, financial instruments can be considered to have minimal credit, market and liquidity risk if they meet each of the following conditions:
1. Investments are debt instruments that are:
a. securities issued by the Government of Canada;
b. securities guaranteed by the Government of Canada;
c. marketable securities issued by the United States Treasury;
d. securities issued or guaranteed by a provincial government;
e. securities issued by a municipal government;
f. bankers’ acceptances;
g. commercial paper;
h. corporate bonds; and
i. asset-backed securities that meet the following criteria: (1) sponsored by a deposit-taking financial institution that is prudentially regulated at either the federal or provincial level, (2) part of a securitization program supported by a liquidity facility, and (3) backed by assets of an acceptable credit quality.
2. The FMI employs a defined methodology to demonstrate that debt instruments have low credit risk. This methodology should involve more than just mechanistic reliance on credit-risk assessments by an external party.
3. The FMI employs limits on the average time-to-maturity of the portfolio based on relevant stress scenarios in order to mitigate interest rate risk exposures.
29 The use of investment vehicles where investments are held indirectly (e.g. mutual funds and exchange-traded funds) should not result in breaches to the investment constraints listed.
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Request for Comments
4. Instruments have an active market for outright sales or repurchase agreements, including in stressed conditions.
5. Reliable price data on debt instruments are available on a regular basis.
6. Instruments are freely transferable and settled over a securities settlement system compliant with the PFMIs.
– Standard 23: Disclosure of rules, key procedures, and market data
Box 7: Joint Supplementary Guidance – Disclosure of rules, key procedures and market data
Context
The PFMIs state that FMIs should provide sufficient information to their participants and prospective participants to enable them to clearly understand the risks and responsibilities of participating in the system. This note provides additional guidance for Canadian FMIs to meet the components of the disclosure principle related to: (i) public qualitative disclosure and (ii) public quantitative disclosure.
Requirements included in the PFMIs
Principle 23 outlines requirements for disclosure to participants as well as the general public. In addition, specific disclosure requirements are listed in the principles to which they pertain.
The following text has been extracted directly from the PFMIs, Principle 23, Key Consideration 5:
An FMI should complete regularly and disclose publicly responses to the CPMI-IOSCO Disclosure framework for financial market infrastructures. An FMI also should, at a minimum, disclose basic data on transaction volumes and values.
To supplement Key Consideration 5, CPMI-IOSCO published two documents: the Disclosure Framework for Financial Market Infrastructures (the Disclosure Framework),30 and the Quantitative Disclosure Standards for CCPs (the Quantitative Disclosure Standards).31 This note will refer to the disclosures that result from completing the templates provided in these documents as the Qualitative Disclosure and the Quantitative Disclosure, respectively.
Supplementary guidance for Canadian FMIs designated by the Bank of Canada
On its public website, an FMI should publish its Qualitative Disclosure and Quantitative Disclosure, as well as any other public disclosure requirements specified in Principle 23 or in other principles. Any public disclosure should be written for an audience with general knowledge of the financial sector.
(a) Qualitative disclosure (Applies to all types of FMIs)
A Qualitative Disclosure should provide the public with a high-level understanding of an FMI’s governance, operation and risk- management framework.
Summary narrative disclosure
In part four of the Disclosure Framework, FMIs are required to provide a summary narrative of their observance of the Principles. FMIs should provide these narratives at the principle level, and are not required to address Key Considerations or to provide answers to the detailed questions listed in Section 5 of the Disclosure Framework report. Instead, the narrative disclosure should focus on providing a broad audience with an understanding of how each Principle applies to the FMI, and what the FMI has done or plans to do to ensure its observance.
30 The Disclosure Framework is part of a document published in December 2012, titled “Principles for Financial Market Infrastructures: Disclosure Framework and Assessment Methodology”, and is available at http://www.bis.org/press/p121214.htm. 31 This document is currently in public consultation, and is available at http://www.bis.org/cpmi/publ/d114.htm. A final version is expected by the end of 2014.
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Request for Comments
Timing
FMIs should update and publish their Qualitative Disclosures following significant changes32 to the system or its environment, or at least every two years. Only the most current Qualitative Disclosure needs to be maintained on the FMI’s website.
(b) Quantitative disclosure (Applies only to CCPs)
Quantitative Disclosures specify the set of key quantitative information required in the Disclosure Framework. They should follow the format provided by CPMI-IOSCO, allowing stakeholders, including the general public, to easily evaluate and compare FMIs.
Currently, CPMI-IOSCO has developed public quantitative disclosure standards only for CCPs. The following guidance applies only to CCPs; Canadian authorities will provide further guidance on the quantitative disclosure requirements of FMIs other than CCPs when such standards have been developed.
Context
Where a general audience may need additional context to properly interpret the data, it should be provided in explanatory notes or addressed in the CCP’s Qualitative Disclosure. CCPs are encouraged to provide charts, background information and additional documentation where it may aid the reader’s understanding.
Comparability
Regulators recognize that, given the different structures and arrangements among CCPs, an overly homogenized presentation format could lead to inaccurate comparability. Subject to regulatory approval, a CCP may provide analogous data in place of a disclosure requirement that is not applicable to its business or representative of the risks it faces. The CCP must justify to authorities the necessity and selection of the alternative metric.33 If granted approval, the CCP must provide the original data to authorities with the frequency specified in the Quantitative Disclosure Standards, and must explain in each public disclosure why an alternative metric was chosen.
Confidentiality
A CCP’s public disclosure obligation does not release it from its confidentiality duties. Where a required disclosure item could reveal (or allow knowledgeable parties to deduce) commercially sensitive information about individual clearing members, clients, third-party contractors or other relevant stakeholders, or where disclosure may amount to a breach of laws or regulations for maintaining market integrity, the data must be omitted. In this case, the CCP must justify the omission to authorities.34 If granted approval, the CCP must provide the confidential data to authorities with the frequency specified in the Quantitative Disclosure Standards, and must explain the reason for the omission in each public disclosure.
Timing
Quantitative Disclosures should be reported quarterly, and updated with the frequency specified in the Quantitative Disclosure Standards.35 Even though some required data may already be publicly disclosed in other reports, or may not have changed from the previous quarter, the data should still be included in the disclosure matrix for completeness and consistency. Data should be publicly disclosed no later than 60 days after the end of each fiscal quarter, and should remain available on its website for at least three years so that trends can be examined.
32 Updated Qualitative Disclosures should be published subsequent to regulatory approval, and prior to the effective date of the significant change. Significant changes can include, but are not limited to: (i) any changes to the FMI’s constating documents, bylaws, corporate governance or corporate structure; (ii) any material change to an agreement between the FMI and its participants or to the FMI’s rules, operating procedures, user guides, or manuals or the design, operation or functionality of its operations and services; and (iii) the establishment of, or removal or material change to, a link, or commencing or ceasing to engage in a business activity. 33 If the authorities are satisfied with the justification, the CCP need not resubmit the substitution unless the CCP’s structure or arrangements change the applicability of the original disclosure requirement, or the CCP wishes to change its substituted metric. CCPs are responsible for informing authorities of any changes that could affect the applicability of the originally required or substituted data. 34 If the authorities are satisfied with the justification, the CCP need not resubmit the omission unless the circumstances change the confidentiality of the disclosure. CCPs are responsible for informing the authorities of any changes that could affect the confidentiality of such data. 35 According to the Quantitative Disclosure Standards, items under general business risk should be updated annually, and all other items should be updated on a quarterly basis.
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Request for Comments
PART 4 OTHER REQUIREMENTS OF RECOGNIZED CLEARING AGENCIES
Introduction
4.0 As discussed in section 1.2(2) of this CP, the provisions of Part 4 are in addition to the requirements of Part 3, and apply to a clearing agency whether or not it operates as a CCP, SSS or CSD.
Division 1 – Governance:
Board of directors
4.1 (2) A definition of independence is provided in subsection 4.1(3). The clearing agency should publicly disclose which board members it regards as independent.
(3) Subsection 4.1(3) defines independence to be the absence of any direct or indirect material relationship between an individual and a clearing agency. Under subsection 4.1(4), those relationships which could, in the view of the clearing agency’s board of directors, be reasonably expected to interfere with the exercise of a member's independent judgment should be considered material relationships within the meaning of subsection 4.1(3). Subsection 4.1(5) describes those individuals that we believe have a relationship with a clearing agency that would reasonably be expected to interfere with the exercise of the individual's independent judgment. Consequently, these individuals are not considered independent for the purposes of section 4.1.
Documented procedures regarding risk spill-overs
4.2 See the Joint Supplementary Guidance in Box 2 under section 3.1 of this CP.
CRO and CCO
4.3 (3) The reference to “harm to the broader financial system” in subparagraph 4.3(3)(c)(ii) may be in relation to the domestic or international financial system.
Board or advisory committees
4.4 All committees should have clearly assigned responsibilities and procedures. The clearing agency’s internal audit function should have sufficient resources and independence from management to provide, among other activities, a rigorous and independent assessment of the effectiveness of its risk-management and control processes. A board will typically establish an audit committee to oversee the internal audit function. In addition to reporting to senior management, the audit function should have regular access to the board through an additional reporting line.
With respect to independence, policies and procedures related to committees should include processes to identify, address, and manage potential conflicts of interest. Conflicts of interest include, for example, circumstances in which a board member has material competing business interests with the clearing agency.
Division 2 – Default management:
Use of own capital
4.5 The CSA are of the view that a CCP should be required to participate in the default waterfall with its own capital contribution, to be used immediately after a defaulting participant’s contributions to margin and default fund resources have been exhausted, and prior to non-defaulting participants’ contributions. Such equity should be a reasonable proportion of the size of the CCP’s total default fund that is significant enough to attract senior management’s attention, and should be separately retained and not form part of the CCP’s resources for other purposes, such as to cover general business risk.
Division 3 – Operational risk:
Systems requirements
4.6 (a) The intent of these provisions is to ensure that controls are implemented to support information technology planning, acquisition, development and maintenance, computer operations, information systems support, and security. Recognized guides as to what constitutes adequate information technology controls include ‘Information Technology Control Guidelines’ from the Canadian Institute of Chartered Accountants (CICA) and ‘COBIT’ from the IT Governance Institute.
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Request for Comments
(b) Capacity management requires that the clearing agency monitor, review, and test (including stress test) the actual capacity and performance of the system on an ongoing basis. Accordingly, under paragraph 4.6(b), the clearing agency is required to meet certain standards for its estimates and for testing. These standards are consistent with prudent business practice. The activities and tests required in this paragraph are to be carried out at least once a year. In practice, continuing changes in technology, risk management requirements and competitive pressures will often result in these activities being carried out or tested more frequently.
(c) A failure, malfunction or delay or other incident is considered to be “material” if the clearing agency would, in the normal course of operations, escalate the matter to or inform its senior management ultimately accountable for technology. It is also expected that, as part of this notification, the clearing agency will provide updates on the status of the failure and the resumption of service. Further, the clearing agency should have comprehensive and well-documented procedures in place to record, report, analyze, and resolve all operational incidents. In this regard, the clearing agency should undertake a “post-incident” review to identify the causes and any required improvement to the normal operations or business continuity arrangements. Such reviews should, where relevant, include the clearing agency’s participants. The results of such internal reviews are required to be communicated to the securities regulatory authority as soon as practicable. Subsection 4.6(c) also refers to a material security breach. A material security breach or systems intrusion is considered to be any unauthorized entry into any of the systems that support the functions of the clearing agency or any system that shares resources with one or more of these systems. Virtually any security breach would be considered material and thus reportable to the securities regulatory authority. The onus would be on the clearing agency to document the reasons for any security breach it did not consider material.
Systems reviews
4.7 (1) A qualified party is a person or company or a group of persons or companies with relevant experience in both information technology and in the evaluation of related internal systems or controls in a complex information technology environment. Qualified persons may include external auditors or third party information system consultants, as well as employees of the clearing agency, but may not be persons responsible for the development or operation of the systems or capabilities being tested.
Clearing agency technology requirements and testing facilities
4.8 (1) The technology requirements required to be publicly disclosed under subsection 4.8(1) do not include detailed proprietary information.
(4) We expect the amended technology requirements to be made publicly available as soon as practicable, either while the changes are being made or immediately after.
Testing of business continuity plans
4.9 Business continuity management is a key component of a clearing agency’s operational risk-management framework. A recognized clearing agency’s business continuity plan and its associated arrangements should be subject to frequent review and testing. At a minimum, under section 4.9, such tests must be conducted annually. Tests should address various scenarios that simulate wide-scale disasters and inter-site switchovers. The clearing agency’s employees should be thoroughly trained to execute the business continuity plan and participants, critical service providers, and linked clearing agencies should be regularly involved in the testing and be provided with a general summary of the testing results. The CSA expect that the clearing agency will also facilitate and participate in industry-wide testing of the business continuity plan. The clearing agency should make appropriate adjustments to its business continuity plan and associated arrangements based on the results of the testing exercises.
Outsourcing
4.10 Where a recognized clearing agency relies upon or outsources some of its operations to a service provider, it should generally ensure that those operations meet the same requirements they would need to meet if they were provided internally. Under section 4.10, the clearing agency must meet various requirements in respect of the outsourcing of critical services or systems to a service provider. These requirements apply regardless of whether the outsourcing arrangements are with third- party service providers, or with affiliates of the clearing agency.
Generally, the clearing agency is required to establish, implement, maintain and enforce policies and procedures to evaluate and approve outsourcing agreements to critical service providers. Such policies and procedures should include assessing the suitability of potential service providers and the ability of the clearing agency to continue to comply with securities legislation in the event of the service provider’s bankruptcy, insolvency or termination of business. The clearing agency is also required to monitor and evaluate the on-going performance and compliance of the service provider to which they outsourced critical services, systems or facilities. Accordingly, the clearing agency should define key performance indicators that will measure the
November 27, 2014 (2014), 37 OSCB 10570
Request for Comments service level. Further, the clearing agency should have robust arrangements for the substitution of such providers, timely access to all necessary information, and the proper controls and monitoring tools.
Under section 4.10, a contractual relationship should be in place between the clearing agency and the critical service provider allowing it and relevant authorities to have full access to necessary information. The contract should ensure that the clearing agency’s approval is mandatory before the critical service provider can itself outsource material elements of the service provided to the clearing agency, and that in the event of such an arrangement, full access to the necessary information is preserved. Clear lines of communication should be established between the outsourcing clearing agency and the critical service provider to facilitate the flow of functions and information between parties in both ordinary and exceptional circumstances.
Where the clearing agency outsources operations to critical service providers, it should disclose the nature and scope of this dependency to its participants. It should also identify the risks from its outsourcing and take appropriate actions to manage these dependencies through appropriate contractual and organisational arrangements. The clearing agency should inform the securities regulatory authority about any such dependencies and the performance of these critical service providers. To that end, the clearing agency can contractually provide for direct contacts between the critical service provider and the securities regulatory authority, contractually ensure that the securities regulatory authority can obtain specific reports from the critical service provider, or the clearing agency may provide full information to the securities regulatory authority.
Division 4 – Participation requirements:
Access requirements and due process
4.11 (1)(d) We are of the view that a requirement on participants of a CCP serving the derivatives markets to use an affiliated trade repository to report derivatives trades would be unreasonable.
PART 5 BOOKS AND RECORDS AND LEGAL ENTITY IDENTIFIER
Legal Entity Identifiers
5.2 (3) The Global Legal Entity Identifier System defined in subsection 5.2(1) and referred to in subsections 5.2(3) and 5.2(4) is a G20 endorsed system36 that will serve as a public-good utility responsible for overseeing the issuance of legal entity identifiers (LEIs) globally to counterparties who enter into transactions in order to uniquely identify parties to transactions. It is currently being designed and implemented under the direction of the LEI Regulatory Oversight Committee (ROC), a governance body endorsed by the G20.
(4) If the Global LEI System is not available at the time a clearing agency is required to fulfill their recordkeeping or reporting requirements under securities legislation, they must use a substitute LEI. The substitute LEI must be in accordance with the standards established by the LEI ROC for pre-LEI identifiers. At the time the Global LEI System is operational, a clearing agency or its affiliates must cease using their substitute LEI and commence using their LEI. It is conceivable that the two identifiers could be identical.
36 See http://www.financialstabilityboard.org/list/fsb_publications/tid_156/index.htm for more information.
November 27, 2014 (2014), 37 OSCB 10571
Request for Comments
6.1.2 Proposed Amendments to NI 45-106 Prospectus and Registration Exemptions, NI 41-101 General Prospectus Requirements, NI 44-101 Short Form Prospectus Distributions and NI 45-102 Resale Restrictions and Proposed Repeal of NI 45-101 Rights Offering
The CSA Notice and Request for Comment for Proposed Amendments to NI 45-106 Prospectus and Registration Exemptions, NI 41-101 General Prospectus Requirements, NI 44-101 Short Form Prospectus Distributions and NI 45-102 Resale Restrictions and Proposed Repeal of NI 45-101 Rights Offering is reproduced on the following internally numbered pages. Bulletin pagination resumes at the end of the CSA Notice.
November 27, 2014 (2014), 37 OSCB 10572
CSA Notice and Request for Comment Proposed Amendments to National Instrument 45-106 Prospectus and Registration Exemptions, National Instrument 41-101 General Prospectus Requirements, National Instrument 44-101 Short Form Prospectus Distributions, and National Instrument 45-102 Resale Restrictions and Proposed Repeal of National Instrument 45-101 Rights Offerings
November 27, 2014
Introduction
The Canadian Securities Administrators (the CSA or we) are publishing for a 90-day comment period
proposed amendments to:
National Instrument 45-106 Prospectus and Registration Exemptions (NI 45-106), National Instrument 41-101 General Prospectus Requirements (NI 41-101), National Instrument 44-101 Short Form Prospectus Distributions (NI 44-101), National Instrument 45-102 Resale Restrictions (NI 45-102), and
the proposed repeal of National Instrument 45-101 Rights Offerings (NI 45-101) (collectively, the Proposed Amendments).
We are also publishing for comment proposed changes to:
Companion Policy 45-106CP to NI 45-106 (45-106CP), and Companion Policy 41-101CP to NI 41-101 (41-101CP).
If adopted, the Proposed Amendments would create a streamlined prospectus exemption for rights offerings conducted by reporting issuers other than investment funds that are subject to National Instrument 81-102 Investment Funds (NI 81-102). The Proposed Amendments would also update or revise some of the requirements for rights offerings by way of prospectus and repeal the prospectus exemption for rights offerings by non-reporting issuers.
The text of the Proposed Amendments is contained in Annex A of this notice and is also available on websites of CSA jurisdictions, including: www.lautorite.qc.ca www.albertasecurities.com www.bcsc.bc.ca
nssc.novascotia.ca www.osc.gov.on.ca www.msc.gov.mb.ca
Substance and Purpose
Rights offerings can be one of the fairer ways for issuers to raise capital as they provide security holders with an opportunity to protect themselves from dilution. However, the CSA recognizes that reporting issuers very seldom use prospectus-exempt rights offerings because of the associated time and cost.
The Proposed Amendments are designed to make prospectus-exempt rights offerings more attractive to reporting issuers by creating a streamlined prospectus exemption (the Proposed Exemption). The Proposed Exemption updates requirements and removes the current regulatory review process prior to use of the rights offering circular. We have also proposed increased investor protection through the addition of civil liability for secondary market disclosure and the introduction of a user-friendly form of rights offering circular.
The Proposed Amendments would also update or revise some of the requirements for rights offerings by way of prospectus and repeal both NI 45-101 and the prospectus exemption in NI 45-106 for rights offerings by non-reporting issuers.
Background
Currently, an issuer wanting to conduct a prospectus-exempt rights offering in Canada would use the prospectus exemption in section 2.1 of NI 45-106 (the Current Exemption). Some of the key conditions of the Current Exemption are the offering must comply with the requirements of NI 45-101; the securities regulatory authority must not object to the offering - this results in a review of the rights offering circular by CSA staff; reporting issuers are restricted from issuing more than 25% of their securities under the exemption in any 12 month period.
Very few reporting issuers use the Current Exemption. During the past year, CSA staff conducted research, collected data and held informal consultations with market participants to identify issues and to consider changes to the Current Exemption that would facilitate prospectus-exempt rights offerings.
Through this work, the CSA found that the overall time period to conduct a prospectus-exempt rights offering, including the CSA review period, was much longer than the time period when using other prospectus exemptions. Specifically, CSA staff looked at 93 rights offerings by reporting issuers over the last seven years and found that the average length of time to complete an offering was 85 days and the average length of time between filing of the draft circular and notice of acceptance by the regulator was 40 days. CSA staff heard that the length of time to complete an offering results in lack of certainty of financing and increased costs.
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Market participants also reported that the dilution limit was too low and greatly restricts the ability of issuers with small market capitalization to raise sufficient funds to make a rights offering worthwhile.
Summary of the Proposed Amendments
1. Proposed new exemption for reporting issuers
Availability The Proposed Exemption would only be available for reporting issuers, other than investment funds that are subject to NI 81-102. Pursuant to section 9.1.1 of NI 81-102, which was effective September 22, 2014, investment funds that are subject to that Instrument are restricted from issuing warrants or rights.
Notice We propose a new form of notice that issuers will have to file and send to security holders before using the Proposed Exemption (Proposed Form 45-106F14 or the Notice). Proposed Form 45- 106F14 will require basic disclosure about the offering. It will also inform security holders how to access the rights offering circular electronically. We anticipate that a Notice prepared in Proposed Form 45-106F14 will only be one to two pages long. We do not anticipate that the requirement to send the Notice will be burdensome as issuers would already have to send rights offering certificates.
Circular Issuers will have to prepare and file a new form of rights offering circular (Proposed Form 45- 106F15 or the Circular). Issuers will not have to send the Circular to security holders. We propose to require that all disclosure under Proposed Form 45-106F15 be in a question and answer format. This format is intended to be easier for issuers to prepare and more straightforward for investors to understand. The disclosure required by Proposed Form 45- 106F15 focuses on information about the rights offering, the use of funds available and the financial condition of the issuer. We do not propose to require information about the business in the Circular. Most investors that exercise rights will already be existing security holders familiar with the issuer’s continuous disclosure or will otherwise be able to access it on SEDAR.
The issuer must also certify that the Circular contains no misrepresentations.
Review Under the Current Exemption, an issuer cannot use a circular until CSA staff have issued a notice of acceptance. Under the Proposed Exemption, CSA staff will not review the Notice or Circular prior to use. However, for a period of two years from the adoption of the Proposed Exemption, CSA staff in certain jurisdictions intend to conduct reviews of Circulars (in most cases, on a post-distribution basis) to understand how issuers are using the Proposed Exemption and to ensure that issuers are complying with the conditions of the Proposed Exemption.
CSA staff also conduct continuous disclosure reviews of issuers on an ongoing basis. As noted in CSA Staff Notice 51-312 (Revised) Harmonized Continuous Disclosure Review Program, staff
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use various tools to target those issuers that are most likely to have deficiencies in their disclosure.
Dilution limit The Proposed Exemption will not be available where there would be an increase of more than 100% in the number of outstanding securities of the class to be issued upon exercise of rights, assuming the exercise of all rights issued under the Proposed Exemption by the issuer during the preceding 12 months. This provision represents a substantial increase from the 25% dilution limit under the Current Exemption and applies to all reporting issuers. If a reporting issuer wanted to conduct a rights offering where there would be greater dilution, it could still do so by using a prospectus.
Timing Under the Proposed Exemption, issuers will be required to file and send the Notice prior to commencement of the exercise period and to file the Circular concurrently with the Notice.
We propose that the exercise period be a minimum of 21 days and a maximum of 90 days. These time periods are substantially consistent with the Current Exemption.
Offer to all security holders One of the conditions of the Proposed Exemption is that the issuer must make the basic subscription privilege available on a pro rata basis to each security holder of the class of securities to be distributed on exercise of the rights. This requirement means that an issuer using the Proposed Exemption must offer the rights to all security holders of that class in the local jurisdiction, even if there is only a small number of security holders in that jurisdiction.
This is distinct from the Current Exemption where there is no clear requirement to offer rights to all security holders. We do not anticipate that this requirement will add time to the offering as there will no longer be a review by CSA staff in each jurisdiction prior to the offering.
Pricing For reporting issuers that are listed on a marketplace, we propose that the subscription price for a security issuable on exercise of a right must be lower than the market price at the time of filing the Notice. The main purpose of a rights offering is to allow all security holders to participate on a pro rata basis. Requiring a discount from market price will allow more retail security holders to participate.
For reporting issuers that are not listed on a marketplace, we propose that the subscription price for a security issuable on exercise of a right must be lower than fair value at the time of filing the Notice. This provision would not apply if insiders of the issuer are restricted from increasing their proportionate interest in the issuer through the offering or through a stand-by commitment. This exception recognizes that it may be difficult or expensive for an unlisted issuer to provide evidence of fair value.
In both situations, should the market price or fair value fall below the subscription price at any time following the filing of the Notice, insiders will still be able to participate in the offering.
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Stand-by commitments We propose to permit stand-by commitments subject to certain requirements, such as the issuer must confirm and disclose that the stand-by guarantor has the financial ability to carry through on the stand-by commitment.
Closing news release A condition of the Proposed Exemption is that the issuer must file a closing news release. The closing news release must contain prescribed information about the rights offering, such as the aggregate gross proceeds and amounts of securities distributed under each of the basic subscription privilege, the additional subscription privilege and the stand-by commitment.
Resale restrictions The Proposed Exemption would be subject to a seasoning period on resale meaning that, in most situations, there would be no hold period. These are the same resale restrictions that apply to securities issued under the Current Exemption.
Statutory liability We propose that the statutory civil liability for secondary market disclosure provisions would apply to the acquisition of securities in a rights offering. To effect this change, the Proposed Exemption must be prescribed in each jurisdiction’s local securities legislation as subject to the secondary market civil liability provisions. This also means prescribing, for those purposes, the exemption in section 2.42 of NI 45-106, if the original securities were issued under the Proposed Exemption. This proposal is intended to ensure that investors relying on a Circular have rights of action in respect of a misrepresentation in an issuer’s continuous disclosure, including the Circular.
We are proposing statutory secondary market civil liability as it attaches to misrepresentations in an issuer's continuous disclosure record document. While contractual liability offers a direct remedy for an individual security holder, it may not be available in all circumstances and for all continuous disclosure. Additionally, there is a potential risk that an issuer would not provide the contractual rights to security holders, or that the contractual rights are not consistent from issuer to issuer and from offering to offering.
Technical disclosure Under paragraph 4.2(1)(e) of National Instrument 43-101 Standards of Disclosure for Mineral Projects, with certain exceptions, a reporting issuer must file a technical report if a rights offering circular filed by the issuer contains scientific or technical information that relates to a mineral project on a property material to the issuer. This requirement would still apply to Circulars filed under the Proposed Exemption. However, Proposed Form 45-106F15 contains no required technical or business disclosure. As a result, we do not anticipate that an issuer will trigger the technical report requirement unless it chooses to include technical disclosure in its Circular.
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2. Proposed repeal of the prospectus exemption for rights offerings by non-reporting issuers
We propose to repeal the Current Exemption. This would mean there would no longer be a prospectus exemption for rights offerings by non-reporting issuers. The Current Exemption provides for limited disclosure of the issuer and its business in the rights offering circular and existing security holders do not have access to continuous disclosure about the issuer. As a result, we are concerned that there is insufficient disclosure for an investor to make an informed investment decision and to justify a prospectus exemption. We expect this will not have a significant impact as there is very little use of the Current Exemption by non-reporting issuers.
We also propose to repeal NI 45-101 and withdraw Companion Policy 45-101CP to NI 45-101.
3. Proposed amendments for rights offerings conducted by way of prospectus
We propose to move all of the requirements related to rights offerings distributed by way of prospectus to NI 41-101 and all applicable guidance to 41-101CP. As NI 41-101 is the primary instrument for prospectus requirements, it is more logical for requirements that apply to rights offerings distributed by way of prospectus to reside in that instrument.
The only proposed substantive change for rights offerings distributed by way of prospectus is the proposed pricing requirements which will be the same as under the Proposed Exemption. The reason for the change in pricing requirements is discussed above.
4. Proposed exemption for securities distributed as part of a stand-by commitment
In proposed section 2.1.2 of NI 45-106, we introduce a prospectus exemption for securities issued to a stand-by guarantor as part of a distribution under the Proposed Exemption (the Stand-by Exemption). Currently, there is no specific exemption for the distribution of securities under a stand-by commitment if the stand-by guarantor is not a current security holder. If the stand-by guarantor is a security holder as at the date of the Notice (other than a registered dealer), the issuer would be able to distribute securities to them under the Proposed Exemption with only a seasoning period on resale. We believe that a restricted period on resale is not appropriate where a stand-by guarantor is already a security holder of the issuer. A restricted period on resale could potentially place the stand-by guarantor at a disadvantage compared to other security holders who may take up the entire additional subscription privilege without any resale restrictions.
Under the Stand-by Exemption, the stand-by guarantor would have to acquire the securities as principal. Securities issued under the Stand-by Exemption would be subject to a restricted period on resale. We believe a restricted period on resale is appropriate as allowing a stand-by guarantor that is not a security holder of the issuer or is a registered dealer to receive free trading securities could result in the stand-by guarantor distributing a block of shares into the market, without liability for the issuer’s disclosure (as in the case under a prospectus, where an underwriter and a promoter accept liability for the issuer’s disclosure and each sign a certificate).
We are considering whether securities issued to a stand-by guarantor who is a current security
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holder should also be subject to a restricted period on resale. If we were to impose a restricted period on resale, the stand-by guarantor could still acquire free-trading securities under the basic subscription privilege. The four-month hold would only apply to securities issued to the stand-by guarantor as part of the stand-by commitment. A four-month hold period might be appropriate because the existing security holder would already have free trading securities of the issuer and would receive a benefit by being able to potentially invest more at a lower price than the stand- by guarantor would otherwise be able to invest under other prospectus exemptions. In addition, we note that the stand-by guarantor is usually a strategic investor for whom a hold period should not be an impediment.
5. Proposed exemption for issuers with a minimal connection to Canada
In proposed section 2.1.3 of NI 45-106, we propose a prospectus exemption for issuers with minimal connection to Canada (the Minimal Connection Exemption). The prospectus requirement would not apply to rights offerings in specified situations where the number of securities and beneficial holders in Canada, and in the local jurisdiction, is minimal. The issuer must provide a notice to the regulator and send to security holders in Canada all of the materials sent to other security holders. The Minimal Connection Exemption is substantially the same as the current exemption in section 10.1 of NI 45-101.
Anticipated Costs and Benefits of the Proposed Amendments
Reporting issuers
We anticipate that the Proposed Exemption will benefit reporting issuers by reducing the time and associated costs of conducting a rights offering. Removing regulatory review of the Circular will significantly reduce the amount of time to conduct the offering. Reducing the time period may also increase the certainty of financing. The pro rata requirement and increased dilution limit provide issuers with a more equitable means of raising sufficient funds.
Issuers will incur some upfront administrative costs to comply with the new disclosure requirements, especially for the Proposed Form 45-106F15. However, we do not anticipate these costs will outweigh the benefits mentioned above and expect issuers will be more likely to choose rights offerings as a means of financing than previously.
Existing security holders
We anticipate that the use of rights offerings will benefit existing security holders to the extent that they will have an opportunity to retain their pro rata holdings of an issuer. However, this benefit must be contrasted against the monetary outlay in additional proceeds necessary to maintain their holdings regardless of the outcome of their investment.
Removal of the regulatory review may deprive existing security holders of the protections associated with such a review before the offering. We believe the reduced investor protection afforded by a review to be the main cost to existing security holders. However, we believe the addition of civil liability for secondary market disclosure and the enhanced disclosure required
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by Proposed Form 45-106F15 will mitigate these concerns. Proposed Form 45-106F15 requires disclosure in the Circular to be in a user-friendly, question and answer format that we anticipate will better inform investors about the offering and the associated risk.
In addition, for a period of two years from the adoption of the Proposed Exemption, CSA staff in certain jurisdictions intend to conduct post-distribution reviews of Circulars to understand how issuers are using the Proposed Exemption and to ensure that issuers are complying with the conditions of the Proposed Exemption. CSA staff also conduct continuous disclosure reviews of issuers on an ongoing basis. Staff use various tools to target those issuers that are most likely to have deficiencies in their disclosure.
Local Matters
Annex B to this notice is being published in any local jurisdiction that is making related changes to local securities laws, including local notices or other policy instruments in that jurisdiction. It also includes any additional information that is relevant to that jurisdiction only.
Annex B to this notice outlines the proposed amendments to local securities legislation. Each jurisdiction that is proposing local amendments will publish an Annex B outlining the proposed local amendments for that jurisdiction.
Request for Comments
We welcome your comments on the Proposed Amendments, and the proposed changes to the related companion policies. In addition to any general comments you may have, we also invite comments on the following specific questions:
Questions relating to the Proposed Exemption
1. We propose that the exercise period for a rights offering under the Proposed Exemption must be a minimum of 21 days and a maximum of 90 days. These time periods are substantially consistent with those under the Current Exemption. Some market participants have told us that an exercise period of 21 days is too long. Others thought a longer exercise period is beneficial. Reasons cited for a longer exercise period are that at least 21 days may be necessary to reach beneficial security holders and foreign security holders and that institutional investors often need a longer period to receive approvals.
(a) Do you agree that the exercise period should be a minimum of 21 days and a maximum of 90 days?
(b) If not, what are the most appropriate minimum and maximum exercise periods? Why?
2. We propose that the Notice must be filed and sent before the exercise period begins and that the Circular must be filed concurrently with the Notice. Do you foresee any
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challenges with this timing requirement?
3. Some market participants have suggested we consider requiring the issuer to only file and not send the Notice and the Circular. While we do not think that the issuer should have to send the Circular itself, it is our view that the issuer should send the Notice to ensure that each security holder is aware of the offering. We also understand that the issuer would have to send rights certificates to security holders in any event.
(a) Do you foresee any challenges with requiring the issuer to send a paper copy of the Notice?
(b) Do you foresee any challenges with the Circular only being available electronically?
4. The required disclosure in the proposed Circular focuses on information about the offering, the use of funds available and the financial condition of the issuer. We do not propose to require information about the business in the Circular.
(a) Have we included the right information for issuers to address in their disclosure?
(b) Is there any other information that would be important to investors making an investment decision in the rights offering?
5. Under the Proposed Exemption, we would require the issuer to include certain information in their closing news release including the amount of securities distributed under each of the basic subscription privilege and the additional subscription privilege to insiders as a group and to all other persons as a group. Other required disclosure includes the aggregate gross proceeds of the distribution, the amount of securities distributed under any stand-by commitment, the amount of securities issued and outstanding as at the closing date and the amount of any fee or commission paid in connection with the distribution. This information will give investors a more complete understanding of who acquired securities under the rights offering.
Do you think that this disclosure will be unduly burdensome? If so, what disclosure would be more appropriate?
6. The Current Exemption permits the trading of rights and we propose to allow for the trading of rights under the Proposed Exemption. We have received mixed feedback from market participants on the costs and benefits of allowing rights to trade freely.
On the one hand, the trading of rights adds complexity to a rights offering and could potentially add a few days to the timeline for an average rights offering. The trading of rights also allows the issuance of free-trading securities to new investors. On the other hand, the trading of rights may benefit issuers as it often puts the rights into the hands of holders who are more likely to exercise the rights. It allows for monetization, which means that security holders who are unable to exercise rights could receive compensation for the rights. It also benefits foreign security holders as the issuer’s transfer agent will
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typically attempt to sell the rights of ineligible security holders on the market.
(a) Should we continue to allow rights to be traded? If so, why?
(b) What are the benefits of not allowing rights to be traded?
(c) Should issuers have the option of not listing rights for trading?
7. When we looked at historic use of rights offerings by reporting issuers, we found that the time between the filing of the draft circular and the notice of acceptance was quite lengthy (an average of 40 days). As a result, we considered options to reduce the review period. One of the options was to conduct a more focused initial review in three days rather than 10 days prior to the regulators' acceptance of the offering. The review would focus on sufficiency of proceeds, stand-by commitments, use of proceeds, insiders, and other issues that raise significant investor protection or public interest concerns. We decided not to proceed with this option but instead to remove regulatory review prior to use. This is similar to other prospectus exemptions and it would significantly improve issuers’ time to market. Certain jurisdictions are also proposing reviewing rights offerings on a post-distribution basis for a period of two years to assess the use of and compliance with the Proposed Exemption.
(a) Do you agree with our proposal to remove pre-offering review?
(b) Do the benefits of providing issuers with faster access to capital outweigh the costs of eliminating our review?
(c) Post-distribution review would focus on sufficiency of proceeds, stand-by commitments, use of proceeds, insiders and other issues that raise significant investor protection concerns. Are there other areas that we should focus on?
8. Currently, an investor in a rights offering has no statutory recourse if there is a misrepresentation in an issuer’s rights offering circular or continuous disclosure record. We propose that civil liability for secondary market disclosure provisions would apply to the acquisition of securities in a rights offering under the Proposed Exemption.
(a) Is this the appropriate standard of liability to protect investors given that there will be no review by CSA staff of an issuer's rights offering circular?
(b) Would requiring a contractual right of action for a misrepresentation in the circular be preferable? If so, what impact would this standard of liability have on the length and complexity of an issuer's offering circular, given that in order for the contractual liability to cover additional continuous disclosure record documents, the issuer may have to incorporate by reference those documents into the issuer's circular.
9. Given the potential size of rights offerings, there may be circumstances where it is desirable to mitigate the effect of the offering on control of an issuer. In this regard, CSA
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staff question whether security holders would benefit from separating the timing of the basic subscription and additional subscription privilege such that an issuer would announce the results of the basic subscription before commencing the additional subscription privilege period. An issuer's announcement of the results of the basic subscription may help security holders make more informed decisions about their participation under the additional subscription privilege.
(a) Would security holders benefit from knowing the results of the basic subscription before making an investment decision through the additional subscription privilege?
(b) Would security holders make a different investment decision through the additional subscription if the results of the basic subscription were announced? If so,
Should the additional subscription privilege be inside or outside of 21 days?
Should the split timing for basic subscriptions and additional subscriptions always be required or only required in circumstances where there may be an impact on control?
(c) What are the costs and benefits of having a two-tranche system for security holders?
Questions relating to the repeal of the Current Exemption for use by non-reporting issuers
10. We propose repealing the Current Exemption for use by non-reporting issuers. There is very little use of the Current Exemption by non-reporting issuers. We also have concerns that existing security holders of non-reporting issuers do not have access to continuous disclosure about the issuer and the rights offering circular contains very limited disclosure about the issuer and its business. Accordingly, there may not be sufficient disclosure upon which an investor can make an informed investment decision.
(a) If we repeal the rights offering prospectus exemption for non-reporting issuers,
Would this create an obstacle to capital formation for non-reporting issuers?
Do you foresee any other problems?
Would repealing the Current Exemption cause problems for foreign issuers that do not meet the Minimal Connection Exemption? If so, should we consider changes to the Minimal Connection Exemption? Please explain what changes would be appropriate and the basis for those changes.
(b) Do you think we should consider changes to the Current Exemption instead of repealing it? If so, what changes should we consider?
If you think we should change the disclosure requirements, please explain what disclosure would be more appropriate.
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Should non-reporting issuers be required to provide audited financial statements to their security holders with the rights offering circular if they use the exemption?
(c) If the Current Exemption is repealed, non-reporting issuers could continue to offer securities to existing security holders under other prospectus exemptions such as the offering memorandum exemption, the accredited investor exemption, and the family, friends and business associates exemption. Are there other circumstances in which non-reporting issuers need to rely on the Current Exemption? If so, please describe.
Questions relating to the Stand-by Exemption
11. We propose that the securities distributed under the Stand-by Exemption to a stand-by guarantor who is not a current security holder or who is a registered dealer will be subject to a four-month hold period. We understand that stand-by guarantors are often either insiders of the issuer or registered dealers.
(a) Should stand-by guarantors be subject to different resale restrictions depending on whether or not they are security holders of the issuer on the date of the notice?
(b) What challenges would there be for issuers trying to find a stand-by guarantor that is not already a security holder?
12. We are considering whether securities distributed under the Stand-by Exemption to a stand-by guarantor that is an existing security holder should also be subject to a four- month hold.
(a) If the stand-by guarantor is an existing security holder, should we require a four month hold? Why or why not?
(b) We understand that in many cases, a stand-by guarantor receives a fee for providing a stand-by commitment. Should a stand-by guarantor that receives a fee and is a current security holder be subject to a restricted period on resale when other security holders are not subject to the restricted period?
(c) What challenges do you foresee if we require a four-month hold?
Question relating to the Minimal Connection Exemption
13. We are considering whether we should require the filing of materials with the regulator through SEDAR as part of the Minimal Connection Exemption. Most issuers using the Minimal Connection Exemption would be foreign issuers. We understand that some, but not all, of these issuers use local counsel to file the materials. Do you anticipate challenges if we require that materials for the Minimal Connection Exemption be filed on SEDAR?
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Please submit your comments in writing on or before February 25, 2015. If you are sending your comments by email, please also send an electronic file containing the submissions (in Microsoft Word format).
Address your submission to all of the CSA as follows:
British Columbia Securities Commission Alberta Securities Commission Financial and Consumer Affairs Authority (Saskatchewan) Manitoba Securities Commission Ontario Securities Commission Autorité des marchés financiers Financial and Consumer Services Commission (New Brunswick) Superintendent of Securities, Department of Justice and Public Safety, Prince Edward Island Nova Scotia Securities Commission Securities Commission of Newfoundland and Labrador Superintendent of Securities, Northwest Territories Superintendent of Securities, Yukon Superintendent of Securities, Nunavut
Deliver your comments only to the addressees below. Your comments will be distributed to the other participating CSA members.
Larissa Streu Senior Legal Counsel, Corporate Finance British Columbia Securities Commission P.O. Box 10142, Pacific Centre 701 West Georgia Street Vancouver, British Columbia V7Y 1L2 Fax: 604-899-6581 [email protected]
Me Anne-Marie Beaudoin Corporate Secretary Autorité des marchés financiers 800, square Victoria, 22e étage C.P. 246, tour de la Bourse Montréal (Québec) H4Z 1G3 Fax : 514-864-6381 [email protected]
We cannot keep submissions confidential because securities legislation in certain provinces requires publication of a summary of the written comments received during the comment period. In addition, all comments received will be posted on the website of the Autorité des marchés financiers at www.lautorite.qc.ca and the website of the Ontario Securities Commission at
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www.osc.gov.on.ca. Therefore, you should not include personal information directly in comments to be published. It is important that you state on whose behalf you are making the submission.
Thank you in advance for your comments.
Contents of Annexes
The following annexes form part of this CSA Notice:
Annex A: A1: Proposed instruments amending or repealing
NI 45-106 NI 45-101 NI 41-101 NI 44-101 NI 45-102
A2: Proposed changes to 45-106CP 41-101CP
Annex B: Local matters
Questions
Please refer your questions to any of the following:
British Columbia Securities Commission Larissa M. Streu Senior Legal Counsel, Corporate Finance 604-899-6888 1-800-373-6393 [email protected]
Anita Cyr Associate Chief Accountant, Corporate Finance 604-899-6579 1-800-373-6393 [email protected]
Alberta Securities Commission Ashlyn D’Aoust Legal Counsel, Corporate Finance 403-355-4347 1-877-355-0585 [email protected]
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Manitoba Securities Commission Wayne Bridgeman Acting Deputy Director, Corporate Finance 204-945-4905 [email protected]
Ontario Securities Commission Raymond Ho Accountant, Corporate Finance 416-593-8106 1-877-785-1555 [email protected]
Aba Stevens Legal Counsel, Corporate Finance 416-263-3867 1-877-785-1555 [email protected]
Autorité des marchés financiers Jacynthe Charpentier Securities Analyst, Corporate Finance 514-395-0337 ext.4384 1-877-525-0337 [email protected]
Marie-Claude Savard Securities Analyst, Corporate Finance 514-395-0337 ext. 4383 1-877-525-0337 [email protected]
Nova Scotia Securities Commission Donna M. Gouthro Securities Analyst 902-424-7077 [email protected]
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Annex A1
Proposed Amendments to National Instrument 45-106 Prospectus and Registration Exemptions
1. National Instrument 45-106 Prospectus and Registration Exemptions is amended by this Instrument.
2. Section 2.1 is repealed.
3. The Instrument is amended by adding the following after section 2.1:
Rights offering – reporting issuer
Refer to Appendix E of National Instrument 45-102 Resale of Securities. First trades are subject to a seasoning period on resale.
2.1.1 (1) In this section:
“additional subscription privilege” means a privilege, granted to a holder of a right, to subscribe for a security not subscribed for by any holder under a basic subscription privilege;
“basic subscription privilege” means the privilege to subscribe for the number of securities set out in a rights certificate held by a holder of the rights certificate;
“circular” means a completed Form 45-106F15 Rights Offering Circular for Reporting Issuers;
“closing date” means the date of completion of the distribution of the securities issued on exercise of rights issued under this section;
“managing dealer” means a dealer that has entered into an agreement with an issuer under which the dealer has agreed to organize and participate in the solicitation of the exercise of rights issued by the issuer;
“marketplace” has the same meaning as in section 1.1 of National Instrument 21-101 Marketplace Operation;
“market price” means, for securities of a class for which there is a published market,
(a) except as provided in paragraph (b)
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(i) if the published market provides a closing price, the simple average of the closing price of securities of that class on the published market for each of the trading days on which there was a closing price falling not more than 20 trading days immediately before the day as of which the market price is being determined, or
(ii) if the published market does not provide a closing price, but provides only the highest and lowest prices of securities of the class traded, the average of the simple averages of the highest and lowest prices of securities of the class on the published market for each of the trading days on which there were highest and lowest prices falling not more than 20 trading days immediately before the day as of which the market price is being determined, or
(b) if trading of securities of the class in the published market has occurred on fewer than 10 of the immediately preceding 20 trading days, the average of the following amounts established for each of the 20 trading days immediately before the day as of which the market price is being determined:
(i) the average of the closing bid and closing ask prices for each day on which there was no trading;
(ii) if the published market
(A) provides a closing price of securities of the class for each day that there has been trading, the closing price, or
(B) provides only the highest and lowest prices, the average of the highest and lowest prices of securities of that class for each day that there has been trading;
“notice” means a completed Form 45-106F14 Rights Offering Notice for Reporting Issuers;
“published market” means, for a class of securities, a marketplace on which the securities are traded, if the prices at which they have been traded on that marketplace are regularly
(a) disseminated electronically, or
(b) published in a newspaper or business or financial publication of general and regular paid circulation;
“soliciting dealer” means a person or company whose interest in a rights offering is limited to soliciting the exercise of rights by holders of those rights;
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“stand-by commitment” means an agreement between an issuer and the stand-by guarantor who agrees to acquire the securities of the issuer not subscribed for under the basic subscription privilege or the additional subscription privilege;
“stand-by guarantor” means a person or company who provides a stand-by commitment.
(2) For the purpose of the definition of “market price”, if there is more than one published market for a security, and if
(a) only one of the published markets is in Canada, the market price is determined solely by reference to that market;
(b) more than one of the published markets is in Canada, the market price is determined solely by reference to the published market in Canada on which the greatest volume of trading in the particular class of securities occurred during the 20 trading days immediately before the date as of which the market price is being determined; and
(c) none of the published markets is in Canada, the market price is determined solely by reference to the published market on which the greatest volume of trading in the particular class of securities occurred during the 20 trading days immediately before the date as of which the market price is being determined.
(3) The prospectus requirement does not apply to a distribution by an issuer of a right granted by the issuer to purchase a security of its own issue to a security holder of the issuer if all of the following apply
(a) the issuer is a reporting issuer in at least one jurisdiction of Canada;
(b) if the issuer is a reporting issuer in the local jurisdiction, the issuer has filed all periodic and timely disclosure documents that it is required to have filed in that jurisdiction as required by each of the following:
(i) applicable securities legislation;
(ii) an order issued by the regulator or securities regulatory authority;
(iii) an undertaking to the regulator or securities regulatory authority;
(c) before the commencement of the exercise period for the rights, the issuer files and sends the notice to all security holders of the class of securities to be issued on exercise of the rights;
(d) concurrently with filing the notice, the issuer files the circular;
(e) the issuer makes the basic subscription privilege available on a pro rata basis to each security holder of the class of securities to be distributed on the exercise of the rights;
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(f) in Québec, the documents that are required to be filed under paragraphs (c) and (d) must be prepared in French or in French and English.
(4) The issuer must set the subscription price for a security to be issued on exercise of a right granted under subsection (3) lower than
(a) the market price of the security on the date of filing the notice, if there is a published market for the security, or
(b) the fair value of the security on the date of filing the notice, if there is no published market for the security.
(5) Paragraph (4)(b) does not apply if all insiders of the issuer are prohibited from increasing their proportionate interest in the issuer through the exercise of rights under the offering or through a stand-by commitment.
(6) An issuer must not grant an additional subscription privilege to a holder of a right unless all of the following apply
(a) the issuer grants the additional subscription privilege to all holders of rights,
(b) each holder of a right would be entitled to receive, on exercise of the additional subscription privilege, the number or amount of securities equal to the lesser of
(i) the number or amount of securities subscribed for by the holder under the additional subscription privilege, and
(ii) x(y/z) where
x = the aggregate number or amount of securities available through unexercised rights,
y = the number of rights previously exercised by the holder under the rights offering, and
z = the aggregate number of rights previously exercised under the rights offering by holders of rights that have subscribed for securities under the additional subscription privilege;
(c) any unexercised rights are allocated on a pro rata basis to holders who subscribed for additional securities based on the additional subscription privilege up to the number of securities subscribed for by a particular holder, and
(d) the subscription price of the additional subscription privilege is the same as the subscription price for the basic subscription privilege.
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(7) If there is a stand-by commitment,
(a) the issuer must grant an additional subscription privilege to all holders of rights,
(b) the issuer must include a statement in the circular that the issuer has confirmed that the stand-by guarantor has the financial ability to carry through on their stand-by commitment, and
(c) the subscription price under the stand-by commitment must be the same as the subscription price under the basic subscription privilege.
(8) If an issuer has stated in the circular that no security will be issued on the exercise of a right unless a stand-by commitment is provided or unless proceeds no less than the stated minimum amount are received by the issuer, all of the following apply:
(a) the issuer must appoint a depository to hold all money received on the exercise of the rights until either the stand-by commitment is provided or the stated minimum amount is received,
(b) a depository under paragraph (a) must be
(i) a Canadian financial institution, or
(ii) a registrant in the jurisdiction in which the funds are proposed to be held who is acting as managing dealer for the rights offering, or, if there is no managing dealer, who is acting as a soliciting dealer,
(c) the issuer and the depository must enter into an agreement, the terms of which require the depository to return the money in full to the holders of rights that have subscribed for securities under the distribution if either the stand-by commitment is not provided, or the stated minimum amount is not received by the depository during the exercise period for the rights.
(9) The agreement between the depository and the issuer under which the depository is appointed must provide that, if either the stand-by commitment is not provided or the stated minimum amount is not received by the depository during the exercise period for the rights, the money held by the depository will be returned in full to the holders of rights that have subscribed for securities under the distribution.
(10) A circular filed under this section must contain a certificate that states the following: “This rights offering circular does not contain a misrepresentation”.
(11) If the issuer is a company, a certificate under subsection (10) must be signed
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(a) by the issuer’s chief executive officer and chief financial officer or, if the issuer does not have a chief executive officer or chief financial officer, an individual acting in that capacity, and
(b) on behalf of the directors of the issuer, by
(i) any 2 directors who are authorized to sign, other than the persons referred to in paragraph (a), or
(ii) all the directors of the issuer.
(12) If an issuer is not a company, a certificate under subsection (10) must be signed by the persons that, in relation to the issuer, are in a similar position or perform a similar function to the persons referred to in subsection (11).
(13) A certificate under subsection (10) must be true on
(a) the date the certificate is signed, and
(b) the closing date.
(14) An issuer must not file an amendment to a circular filed under paragraph (3)(d) unless
(a) the amendment amends and restates the circular,
(b) the issuer files the amended circular before the earlier of
(i) the listing date of the rights, if the issuer lists the rights for trading, and
(ii) the date the exercise period for the rights commences, and
(c) the issuer issues and files a news release explaining the reason for the amendment concurrently with the filing of the amended circular.
(15) The issuer must file a news release containing the information required by subsection (16) on the closing date or as soon as practicable following the closing date.
(16) The closing news release must include:
(a) the aggregate gross proceeds of the distribution;
(b) the amount of securities distributed under the basic subscription privilege to
(i) all persons who were insiders before the distribution or became insiders as a result of the distribution, as a group, and
(ii) all other persons, as a group;
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(c) the amount of securities distributed under the additional subscription privilege to
(i) all persons who were insiders before the distribution or became insiders as a result of the distribution, as a group, and
(ii) all other persons, as a group;
(d) the amount of securities distributed under any stand-by commitment;
(e) the amount of securities of the class issued and outstanding as at the closing date;
(f) the amount of any fees or commissions paid in connection with the distribution.
(17) Subsection (3) does not apply to a distribution
(a) if there would be an increase of more than 100 percent in the number, or, in the case of debt, the principal amount, of the outstanding securities of the class to be issued upon the exercise of rights, assuming the exercise of all rights issued under this exemption by the issuer during the 12 months immediately before the date of the circular;
(b) if the exercise period for the rights is less than 21 days or more than 90 days after the day the notice is sent to security holders;
(c) if the issuer has entered into an agreement to compensate a person or company for soliciting the exercise of rights issued under the rights offering that provides for the payment of a fee for soliciting the exercise of rights by holders of rights that were not security holders of the issuer immediately before the rights offering and that fee is higher than the fee payable for soliciting the exercise of rights by holders of rights that were security holders at that time;
(d) to a stand-by guarantor, if one of the following applies:
(i) the stand-by guarantor did not hold a security of the issuer on the date the issuer files the notice;
(ii) the stand-by guarantor is a registered dealer.
Rights offering – stand-by commitment
Refer to Appendix D of National Instrument 45-102 Resale of Securities. First trades are subject to a restricted period on resale.
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2.1.2 The prospectus requirement does not apply to the distribution of a security by an issuer to a stand-by guarantor as part of a distribution under section 2.1.1 if the stand-by guarantor acquires the security as principal.
Rights offering – issuer with a minimal connection to Canada
Refer to Appendix E of National Instrument 45-102 Resale of Securities. First trades are subject to a seasoning period on resale.
2.1.3 The prospectus requirement does not apply to a distribution by an issuer of a right granted by the issuer to purchase a security of its own issue to a security holder of the issuer if
(a) to the knowledge of the issuer after reasonable enquiry,
(i) the number of beneficial holders of the class for which the rights are issued that are resident in Canada does not constitute 10 percent or more of all holders of that class,
(ii) the number of securities of the issuer of the class for which the rights are issued that are beneficially held by securityholders resident in Canada does not constitute, in the aggregate, 10 percent or more of the outstanding securities of that class,
(iii) the number of beneficial holders of the class for which the rights are issued that are resident in the local jurisdiction does not constitute five percent or more of all holders of that class,
(iv) the number of securities of the issuer of the class for which the rights are issued that are beneficially held by securityholders resident in the local jurisdiction does not constitute, in the aggregate, five percent or more of the outstanding securities of that class;
(b) all materials sent to any other security holders for the rights offering are concurrently delivered to the regulator or, in Québec, the securities regulatory authority and sent to each securityholder of the issuer resident in the local jurisdiction;
(c) the issuer delivers to the regulator or, in Québec, the securities regulatory authority a written notice that it is relying on this exemption and a certificate of an officer or director of the issuer, or if the issuer is a limited partnership, an officer or director of the general partner of the issuer, or if the issuer is a trust, a trustee or officer or director of a trustee of the issuer, that to the knowledge of the person signing the certificate, after reasonable inquiry that
(i) the number of beneficial holders of the class for which the rights are issued that are resident in Canada does not constitute 10 percent or more of all holders of that class,
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(ii) the number of securities of the issuer of the class for which the rights are issued that are beneficially held by securityholders resident in Canada does not constitute, in the aggregate, 10 percent or more of the outstanding securities of that class,
(iii) the number of beneficial holders of the class for which the rights are issued that are resident in the local jurisdiction does not constitute five percent or more of all holders of that class,
(iv) the number of securities of the issuer of the class for which the rights are issued that are beneficially held by securityholders resident in the local jurisdiction does not constitute, in the aggregate, five percent or more of the outstanding securities of that class.
Rights offering – Listing representation exemption
2.1.4 (1) In this section:
“listing representation” means a representation that a security will be listed or quoted, or that application has been or will be made to list or quote the security, either on an exchange, or on a quotation and trade reporting system, in a foreign jurisdiction;
“listing representation prohibition” means the prohibition in the securities legislation set out in Appendix C.
(2) The listing representation prohibition does not apply to a listing representation made in a rights offering circular for a distribution of rights conducted under section 2.1.3 if the listing representation is not a misrepresentation.
Rights offering – Civil liability for secondary market disclosure
2.1.5 (1) In this section:
“secondary market liability provisions” means the provisions in the securities legislation set out in Appendix D.
(2) The secondary market liability provisions apply to
(a) the acquisition of an issuer’s security pursuant to the exemption from the prospectus requirement set out in section 2.1.1, and
(b) the acquisition of an issuer’s security pursuant to the exemption from the prospectus requirement set out in section 2.42 if the security previously issued by the issuer was acquired pursuant to the exemption that is set out in section 2.1.1..
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4. The Instrument is amended by adding the following appendices:
Appendix C
Listing representation prohibitions Alberta: Subsection 92(3) of the Securities Act (Alberta) Manitoba: Subsection 69(3) of the Securities Act (Manitoba) New Brunswick: Subsection 58(3) of the Securities Act (New Brunswick) Newfoundland and Labrador: Subsection 39(3) of the Securities Act (Newfoundland and Labrador) Northwest Territories: Subsection 147(1) Securities Act (Northwest Territories) Nova Scotia: Subsection 44(3) of the Securities Act (Nova Scotia) Nunavut: Subsection 147(1) of the Securities Act (Nunavut) Ontario: Subsection 38(3) of the Securities Act (Ontario) Prince Edward Island: Subsection 147(1) of the Securities Act (Prince Edward Island) Québec: Subsection 199(4) of the Securities Act (Quebec) Saskatchewan: Subsection 44(3) of the Securities Act (Saskatchewan) Yukon: Subsection 147(1) of the Securities Act (Yukon)
Appendix D
Secondary market liability provisions Alberta: Part 17.01 of the Securities Act (Alberta) British Columbia: Part 16.1 of the Securities Act (British Columbia) Manitoba: Part XVIII of the Securities Act (Manitoba) New Brunswick: Part 11.1 of the Securities Act (New Brunswick) Newfoundland and Labrador: Part XXII.1 of the Securities Act (Newfoundland and Labrador) Northwest Territories: Part 14 of the Securities Act (Northwest Territories) Nova Scotia: Sections 146A to 146N of the Securities Act (Nova Scotia) Nunavut: Part 14 of the Securities Act (Nunavut) Ontario: Part XXIII.1 of the Securities Act (Ontario) Prince Edward Island: Part 14 of the Securities Act (Prince Edward Island) Québec: Division II of Chapter II of Title VIII of the Securities Act (Québec) Saskatchewan: Part XVIII.1 of the Securities Act (Saskatchewan) Yukon: Part 14 of the Securities Act (Yukon).
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5. The Instrument is amended by adding the following forms:
Form 45-106F14 Rights Offering Notice for Reporting Issuers
This is the form of notice you must use for a distribution of rights under section 2.1.1 of National Instrument 45-106 Prospectus and Registration Exemptions.
PART 1 GENERAL INSTRUCTIONS
Deliver this notice to each security holder eligible to receive rights under the rights offering. Using plain language, prepare the notice using a question-and-answer format.
Guidance We do not expect the notice to be greater than two pages in length.
PART 2 THE NOTICE
1. Basic information State the following with the bracketed information completed:
“[Name of issuer] Notice to security holders – [Date]”
If you have less than 12 months of working capital and are aware of material uncertainties that may cast significant doubt upon your ability to continue as a going concern, include the following language in bold type immediately below the date of the notice: “We currently have sufficient working capital to last [insert the number of months of working capital as at the date of the circular] months. We require [insert the percentage of the rights offering required to be taken up]% of the offering to last 12 months.”
2. Who can participate in the rights offering?
State the record date and identify which class of securities is subject to the offering.
3. Who is eligible to receive rights?
Provide information about the jurisdictions in which the issuer is offering rights. Explain how a security holder in an ineligible jurisdiction can acquire the rights and securities issuable upon exercise of rights.
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4. How many rights are we offering?
State the total number of rights offered.
5. How many rights will you receive?
State the number of rights each eligible security holder will receive for every security held as of the record date.
6. What does one right entitle you to receive?
Provide the number of rights required to acquire a security upon exercise of the rights. Also state the subscription price.
7. If you are an eligible security holder, how will you receive your rights?
Include a rights certificate with the rights offering notice if the notice is being delivered to a registered security holder, and direct the security holder’s attention to this certificate. If you are delivering this notice to an ineligible security holder, provide instructions on how the ineligible security holder can receive their rights certificate.
8. When and how can you exercise your rights?
State when the exercise period ends for eligible security holders who have their rights certificate. Also, provide instructions on how to exercise rights to security holders whose securities are held in a brokerage account.
9. What are the next steps?
Direct the security holder to the SEDAR address to find your rights offering circular. State that the security holder should read the circular, along with the issuer’s continuous disclosure record, to make an informed decision. 10. Signature
Sign the notice. State the name and title of the person signing this notice.
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Form 45-106F15 Rights Offering Circular for Reporting Issuers
Table of Contents
PART 1 INSTRUCTIONS
1. Overview of the rights offering circular 2. Incorporating information by reference 3. Plain language 4. Format 5. Omitting information 6. Date of information 7. Forward-looking information
PART 2 SUMMARY OF OFFERING 8. Required statement 9. Basic disclosure about the distribution 10. Purpose of the circular 11. Securities being offered 12. Right entitlement 13. Subscription price 14. Expiry of offer 15. Outstanding securities 16. Securities issuable under the offering 17. Listing of securities
PART 3 USE OF FUNDS AVAILABLE
18. Funds available 19. Use of funds available 20. How long will funds last
PART 4 INSIDER PARTICIPATION
21. Intention of insiders 22. 10% holders before and after the offering
PART 5 DILUTION
23. Dilution
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PART 6 STAND-BY COMMITMENT
24. Stand-by guarantor 25. Financial ability of the stand-by guarantor
PART 7 MANAGING DEALER AND SOLICITING DEALER CONFLICTS
26. The managing dealer, the soliciting dealer, and their fees 27. Managing dealer/soliciting dealer conflict
PART 8 HOW TO EXERCISE THE RIGHTS
28. Security holders who are registered holders 29. Security holders who are not registered holders 30. Eligibility to participate 31. Non-eligible security holder 32. Transfer of rights 33. Additional subscription privilege 34. Trading of underlying securities 35. Fractional rights
PART 9 APPOINTMENT OF DEPOSITORY
36. Depository 37. Release of funds from depository
PART 10 FOREIGN ISSUERS
38. Foreign issuers
PART 11 STATEMENT AS TO RESALE RESTRICTIONS
39. Resale restrictions
PART 12 ADDITIONAL INFORMATION
40. Additional information
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PART 13 CERTIFICATE
41. Date and certificate 42. Signing of certificate
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PART 1 INSTRUCTIONS
1. Overview of the rights offering circular This is the form of circular you must use for a distribution of rights under section 2.1.1. of National Instrument 45-106 Prospectus and Registration Exemptions. The objective of the circular is to provide information about the rights offering and details on how an existing security holder can exercise rights.
Prepare the rights offering circular using a question-and-answer format.
Guidance
We do not expect the circular to be greater than 10 pages.
2. Incorporating information by reference You must not incorporate information into the circular by reference.
3. Plain language Use plain, easy to understand language in preparing the circular. Avoid technical terms but, if they are necessary, explain them in a clear and concise manner.
4. Format Except as otherwise stated, use the questions presented in this form as headings in the circular. To make the circular easier to understand, present information in tables and, where possible, state amounts in figures.
5. Omitting information Unless this form indicates otherwise, you are not required to respond to an item in this form if it does not apply.
6. Date of information Unless this form indicates otherwise, present the information in this form as at the date of the circular.
7. Forward-looking information If you disclose forward-looking information in the circular, you must comply with Part 4A.3 of NI 51-102.
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PART 2 SUMMARY OF OFFERING 8. Required statement State in italics at the top of the cover page the following: “This rights offering circular is prepared by management. No securities regulatory authority or regulator has assessed the merits of these securities or reviewed this circular. Any representation to the contrary is an offence. This is the circular we referred to in the [insert date of rights offering notice] rights offering notice, which you should have received by mail. Your rights certificates and relevant forms were enclosed with the notice. This circular should be read in conjunction with the notice and our continuous disclosure prior to making an investment decision.”
9. Basic disclosure about the distribution Immediately below the statement required above, state the following with the bracketed information completed:
“Rights offering circular [Date]
[Name of Issuer]”
If you have less than 12 months of working capital and are aware of material uncertainties that may cast significant doubt upon your ability to continue as a going concern, include the following language in bold immediately below the name of the issuer: “We currently have sufficient working capital to last [insert the number of months of working capital as at the date of the circular] months. We require [insert the percentage of the rights offering required to be taken up]% of the offering to last 12 months.”
10. Purpose of circular State the following in bold:
“Why are you reading this circular?”
Explain the purpose of the circular. State that the circular provides details about the rights offering and refer to the notice that you sent to security holders.
11. Securities offered State the following in bold:
“What is being offered?”
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Provide the number of rights you are offering to each security holder under the offering. If your outstanding share capital includes more than one class or type of security, ensure you identify which security holders are eligible to receive rights. Include the record date the issuer will use to determine which security holders are eligible to receive rights.
12. Right entitlement State the following in bold:
“What does a right entitle you to receive?”
Explain what one right will entitle the security holder to receive.
13. Subscription price State the following in bold:
“What is the subscription price?”
Provide the price a security holder must pay to exercise a right. If there is no published market for the securities, either explain how you determined the fair value of the securities or explain that no insider will be able to increase their proportionate interest through the rights offering.
Guidance
Refer to subsection 2.1.1(4) of NI 45-106 which provides that the subscription price must be lower than the market price if there is a published market for the securities. If there is no published market, either the subscription price must be lower than the fair value of the securities or insiders are not permitted to increase their proportionate interest in the issuer through the rights offering.
14. Expiry of offer State the following in bold:
“When does the offer expire?”
Provide the date and time when the offer expires.
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Guidance
Refer to paragraph 2.1.1(17)(b) of NI 45-106 which provides that the rights offering exemption is not available where the exercise period for the rights is less than 21 days or more than 90 days after the day the notice is sent to security holders.
15. Outstanding securities State the following in bold:
“How many of our [insert class of securities issuable on exercise of rights] are currently outstanding?”
Provide the number of outstanding securities of the class of securities issuable on exercise of the rights, as at the date of the circular.
16. Securities issuable under the offering State the following in bold:
“What are the minimum and maximum number of [insert type of security issuable on exercise of rights] that may be issued under the offering?”
Provide the minimum, if any, and maximum number of securities that may be issuable on exercise of the rights.
17. Listing of Securities State the following in bold:
“Where will the rights and securities issuable upon exercise of rights be listed for trading?”
Identify the exchange(s) and quotation system(s), if any, on which the rights and underlying securities are traded or quoted. If no market exists, or is expected to exist, state the following in boldface type:
“There is no market through which these [rights and/or underlying securities] may be sold.”
PART 3 USE OF FUNDS AVAILABLE
18. Funds available State the following in bold:
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“What will our funds available be after the offering?”
Using the following table, disclose the funds available after the offering. If you plan to combine additional sources of funding with the offering proceeds to achieve your principal capital-raising purpose, provide details about each additional source of funding.
If there is no minimum offering or stand-by commitment, or if the minimum offering or stand-by commitment represents less than 75% of the offering, include threshold disclosure if only 15%, 50% or 75% of the entire offering is taken up.
Disclose the amount of working capital deficiency, if any, of the issuer as at the most recent month end. If the funds available will not eliminate the working capital deficiency, state how you intend to eliminate or manage the deficiency. If there has been a significant change in the working capital since the most recently audited annual financial statements, explain those changes.
Guidance
We would consider a significant change to include a change in the working capital that results in material uncertainty regarding the issuer’s going concern assumption, or a change in the working capital balance from positive to deficiency or vice versa.
Assuming Assuming Assuming Assuming Assuming minimum 15% of 50% of 75% of 100% of offering or offering offering offering offering stand-by commitment only A Amount to be raised by this $ $ $ $ $ offering B Selling commissions and fees $ $ $ $ $ C Estimated offering costs (e.g., $ $ $ $ $ legal, accounting, audit) D Available funds: D = A - (B+C) $ $ $ $ $ E. Additional sources of funding $ $ $ $ $ required F. Working capital deficiency $ $ $ $ $ G. Total: G = (D+E) - F $ $ $ $ $
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19. Use of funds available State the following in bold:
“How will we use the funds available?”
Using the following table, provide a detailed breakdown of how you will use the funds. Describe in reasonable detail each of the principal purposes, with approximate amounts.
Description of intended use Assuming Assuming Assuming Assuming Assuming of funds available listed in minimum 15% of 50% of 75% of 100% of order of priority. offering or offering offering offering offering stand-by commitment only $ $ $ $ $ $ $ $ $ $ Total: Equal to G in the funds $ $ $ $ $ available table above
If there is no minimum offering or stand-by commitment, or if the minimum offering or stand-by commitment represents less than 75% of the offering, include threshold disclosure if only 15%, 50% or 75% of the entire offering is taken up.
Instructions:
1. If the issuer has significant short-term liquidity requirements, discuss, for each threshold amount (i.e., 15%, 50% and 75%), the impact, if any, of raising that amount on its liquidity, operations, capital resources and solvency. Short-term liquidity requirements include non-discretionary expenditures for general corporate purposes and overhead expenses, significant short-term capital or contractual commitments, and expenditures required to achieve stated business objectives.
When discussing the impact of raising each threshold amount on your liquidity, operations, capital resources and solvency, include all of the following in the discussion: which expenditures will take priority at each threshold, and what effect this allocation has on your operations and business objectives and milestones;
the risks of defaulting on payments as they become due, and what effect the defaults would have on your operations;
an analysis of your ability to generate sufficient amounts of cash and cash equivalents from other sources, the circumstances that could affect those sources and management’s assumptions in conducting this analysis.
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State the minimum amount required to meet the short-term liquidity requirements. In the event that the funds available could be less than the amount required to meet the short-term requirements, describe how management plans to discharge its liabilities as they become due. Include the assumptions management used in its plans.
If the funds available could be insufficient to cover the issuer’s short-term liquidity requirements and overhead expenses for the next 12 months, include management’s assessment of the issuer’s ability to continue as a going concern. If there are material uncertainties that cast significant doubt upon the issuer’s ability to continue as a going concern, state this fact in boldface type.
2. If you will use more than 10% of funds available to reduce or retire indebtedness and the indebtedness was incurred within the two preceding years, describe the principal purposes for which the indebtedness was used. If the creditor is an insider, associate or affiliate of the issuer, identify the creditor and the nature of the relationship to the issuer and disclose the outstanding amount owed.
3. If you will use more than 10% of funds available to acquire assets, describe the assets. If known, disclose the particulars of the purchase price being paid for or being allocated to the assets or categories of assets, including intangible assets. If the vendor of the asset is an insider, associate or affiliate of the issuer, identify the vendor and nature of the relationship to the issuer, and disclose the method used in determining the purchase price.
4. If any of the funds available will be paid to an insider, associate or affiliate of the issuer, disclose in a note to the use of funds available table the name of the insider, associate or affiliate, the relationship to the issuer, and the amount.
5. If you will use more than 10% of funds available for research and development of products or services,
a. describe the timing and stage of research and development that management anticipates will be reached using the funds,
b. describe the major components of the proposed programs you will use the funds available for, including an estimate of anticipated costs,
c. state if you are conducting your own research and development, are subcontracting out the research and development or are using a combination of those methods, and
d. describe the additional steps required to reach commercial production and an estimate of costs and timing.
6. If you may re-allocate funds available, include the following statement:
“We intend to spend the funds available as stated. We will reallocate funds only for sound business reasons.”
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20. How long will funds available last? State the following in bold:
“How long will the funds available last?”
Explain how long management anticipates funds available will last. If you do not have adequate funds to cover anticipated expenses for the next 12 months, state the sources of financing that the issuer has arranged but not yet used. Also, provide an analysis of your ability to generate sufficient amounts of cash and cash equivalents in the short term and the long term to maintain capacity, and to meet planned growth or to fund development activities. You should describe sources of funding and circumstances that could affect those sources that are reasonably likely to occur. If this results in material uncertainties that cast significant doubt upon the issuer’s ability to continue as a going concern, disclose this fact.
If you expect funds available to last for greater than 12 months, state this fact.
PART 4 INSIDER PARTICIPATION 21. Intention of insiders State the following in bold:
“Will insiders be participating?”
Provide the answer. If yes, provide details of insiders’ intentions to exercise their rights.
22. Holders of at least 10% before and after the offering State the following in bold:
“Who are the 10% holders before and after the offering?”
Provide this information in the following tabular form:
Name Holdings before the offering Holdings after the offering [Name of security holder] [State the number of securities [State the number of securities held and the percentage of security held and the percentage of security holdings this represents] holdings this represents]
PART 5 DILUTION 23. Dilution State the following in bold:
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“If you do not exercise your rights, how much will your security holdings be diluted?”
Provide a percentage in the circular and state the assumptions used, as appropriate.
PART 6 STAND-BY COMMITMENT 24. Stand-by guarantor State the following in bold:
“Who is the stand-by guarantor and what are the fees?”
Describe the stand-by commitment and the material terms of the basis on which the stand-by guarantor may terminate the obligation under the stand-by commitment.
25. Financial ability of the stand-by guarantor State the following in bold:
“Have we confirmed that the stand-by guarantor has the financial ability to carry through on its stand-by commitment?”
If the offering has a stand-by commitment, state that you have confirmed that the stand-by guarantor(s) has the financial ability to carry through on its stand-by commitment.
PART 7 MANAGING DEALER, SOLICITING DEALER AND UNDERWRITING CONFLICTS 26. The managing dealer, soliciting dealer, and their fees State the following in bold:
“Who is the [managing dealer/soliciting dealer] and what are their fees?”
Identify the managing dealer, if any, and the soliciting dealers, if any, and describe the commissions or fees payable to them.
27. Managing dealer/soliciting dealer conflicts State the following in bold:
“Does the [managing dealer/soliciting dealer] have a conflict of interest?”
If disclosure is required by National Instrument 33-105 Underwriting Conflicts, include that disclosure.
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PART 8 HOW TO EXERCISE THE RIGHTS 28. Security holders who are registered holders State the following in bold:
“How does a security holder that is a registered holder participate in the offering?”
Explain how a registered holder can participate in the rights offering.
29. Security holders who are not registered holders State the following in bold:
“How does a security holder that is not a registered holder participate in the offering?”
Explain how a security holder who is not a registered holder can participate in the rights offering.
30. Eligibility to participate State the following in bold:
“Who is eligible to participate in the offering?”
Explain which security holders are eligible to participate in the offering. Disclose the jurisdictions in which you are making the rights offering.
31. Non-eligible security holder State the following in bold:
“What if a security holder is not eligible to participate in the offering?”
Explain how a security holder who does not reside in an eligible jurisdiction can participate in the offering.
32. Transfer of rights State the following in bold:
“How does a right holder sell or transfer rights?”
Explain how a holder of rights can sell or transfer rights. If the rights will be listed on an exchange, provide further details related to the trading of the rights on the exchange.
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33. Additional subscription privilege State the following in bold:
“What is the additional subscription privilege and how can you exercise this privilege?”
Describe the additional subscription privilege and explain how a holder of rights who has exercised the basic subscription privilege can exercise the additional subscription privilege.
34. Trading of underlying securities State the following in bold:
“When can you trade securities issuable upon exercise of your rights?”
Say when a security holder can trade the securities issuable upon exercise of the rights.
35. Fractional rights State the following in bold:
“Will we issue fractional rights?”
Respond yes or no and explain (if necessary).
PART 9 APPOINTMENT OF DEPOSITORY 36. Depository State the following in bold:
“Who is the depository?”
If the rights offering is subject to a minimum offering amount, or if there is a stand-by commitment, state the name of the depository you appointed to hold all money received on exercise of the rights until the minimum offering amount or stand-by commitment is received or until the money is returned.
37. Release of funds from depository State the following in bold:
“What happens if we do not raise the [minimum offering amount] or if we do not receive funds from the stand-by guarantor?”
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If the offering is subject to a minimum offering amount, or if there is a stand-by commitment, state that you have entered into an agreement with the depository where the depository will return the money held by it to holders of rights that have already subscribed for securities under the offering, if you do not raise the minimum offering amount or receive funds from the stand-by guarantor.
PART 10 FOREIGN ISSUERS 38. Foreign issuers State the following in bold:
“How can you enforce a judgment against us?”
If the issuer is incorporated, continued, or otherwise organized under the laws of a foreign jurisdiction or resides outside of Canada, state the following:
“The [issuer] is incorporated, continued or otherwise organized under the laws of a foreign jurisdiction or resides out of Canada. It may not be possible for investors to enforce judgments obtained in Canada against any person or company that is incorporated, continued, or otherwise organized under the laws of a foreign jurisdiction or resides outside of Canada.”
PART 11 STATEMENT AS TO RESALE RESTRICTIONS 39. Resale restrictions State the following in bold:
“Are there restrictions on the resale of securities?”
If the issuer is offering rights in one or more jurisdictions where there are restrictions on the resale of securities, include a statement disclosing when those rights and underlying securities will become freely tradable and that until then, such securities may not be resold except pursuant to a prospectus or prospectus exemption, which may only be available in limited circumstances.
PART 12 ADDITIONAL INFORMATION 40. Additional information State the following in bold:
“Where can you find more information about us?”
Provide the SEDAR website address and state that a security holder can access the issuer’s continuous disclosure from that site. If applicable, provide the issuer’s website address.
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PART 13 CERTIFICATE 41. Date and certificate Provide the following statement at the end of the circular:
“Dated: [insert the date the circular is signed]
This rights offering circular does not contain a misrepresentation.”
42. Signing of certificate Sign the certificate in accordance with subsection 2.1.1(10) of NI 45-106..
6. This Instrument comes into force on xx.
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Proposed Amendments to National Instrument 45-101 Rights Offerings
1. National Instrument 45-101 Rights Offerings is repealed by this Instrument.
2. This Instrument comes into force on xx.
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Proposed Amendments to National Instrument 41-101 General Prospectus Requirements
1. National Instrument 41-101 General Prospectus Requirements is amended by this Instrument.
2. The following Part is added after section 8.3:
PART 8A: Rights offerings
Application
8.1A(1) This part applies to an issuer that files a preliminary or final prospectus to distribute rights.
(2) In this Part,
“additional subscription privilege” means a privilege, granted to a holder of a right, to subscribe for a security not subscribed for by any holder under a basic subscription privilege;
“basic subscription privilege” means the privilege to subscribe for the number of securities set out in a rights certificate held by a holder of the rights certificate;
“managing dealer” means a dealer that has entered into an agreement with an issuer under which the dealer has agreed to organize and participate in the solicitation of the exercise of rights issued by the issuer;
“marketplace” has the same meaning as in section 1.1 of National Instrument 21-101 Marketplace Operation;
“market price” means for securities of a class for which there is a published market
(a) except as provided in paragraph (b)
(i) if the published market provides a closing price, the simple average of the closing price of securities of that class on the published market for each of the trading days on which there was a closing price falling not more than 20 trading days immediately before the day as of which the market price is being determined, or
(ii) if the published market does not provide a closing price, but provides only the highest and lowest prices of securities of the class traded, the average of the simple averages of the highest and lowest prices of securities of the class on the published market for
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each of the trading days on which there were highest and lowest prices falling not more than 20 trading days immediately before the day as of which the market price is being determined, or
(b) if trading of securities of the class in the published market has occurred on fewer than 10 of the immediately preceding 20 trading days, the average of the following amounts established for each of the 20 trading days immediately before the day as of which the market price is being determined:
(i) the average of the closing bid and closing ask prices for each day on which there was no trading;
(ii) if the published market
(A) provides a closing price of securities of the class for each day that there has been trading, the closing price, or
(B) provides only the highest and lowest prices, the average of the highest and lowest prices of securities of that class for each day that there has been trading;
“published market” means, for a class of securities, a marketplace on which the securities are traded, if the prices at which they have been traded on that marketplace are regularly
(a) disseminated electronically, or
(b) published in a newspaper or business or financial publication of general and regular paid circulation;
“soliciting dealer” means a person or company whose interest in a rights offering is limited to soliciting the exercise of rights by holders of those rights;
“stand-by commitment” means an agreement by a person or company to acquire securities of an issuer not issued under the basic subscription privilege or the additional subscription privilege available under a rights offering.
(3) For the purpose of the definition of “market price”, if there is more than one published market for a security, and if
(a) only one of the published markets is in Canada, the market price is determined solely by reference to that market;
(b) more than one of the published markets is in Canada, the market price is determined solely by reference to the published market in Canada on
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which the greatest volume of trading in the particular class of securities occurred during the 20 trading days immediately before the date as of which the market price is being determined; and
(c) none of the published markets are in Canada, the market price is determined solely by reference to the published market on which the greatest volume of trading in the particular class of securities occurred during the 20 trading days immediately before the date on which the market price is being determined.
Filing of prospectus for a rights offering
8.2A (1) An issuer must not file a prospectus for a rights offering unless
(a) in addition to qualifying the distribution of the rights, the prospectus qualifies the distribution of the securities issuable on exercise of the rights,
(b) if there is a managing dealer, the managing dealer complies with section 5.9 as if the dealer were an underwriter,
(c) the exercise period for the rights is at least 21 days after the date on which the prospectus is sent to security holders, and
(d) the issuer sets the subscription price for a security issuable on exercise of the right distributed by the prospectus lower than
(i) the market price, as of the date of the final prospectus, if there is a published market for the security, or
(ii) fair value, as of the date of the final prospectus, if there is no published market for the security.
(2) If subparagraph (1)(d)(ii) applies, the issuer must deliver to the regulator independent evidence of fair value.
(3) Subparagraph 1(d)(ii) does not apply if all insiders of the issuer are prohibited from increasing their proportionate interest in the issuer through the exercise of rights under the offering or through a stand-by commitment.
Additional subscription privilege
8.3A An issuer must not grant an additional subscription privilege to a holder of a right unless
(a) the issuer grants the additional subscription privilege to all holders of rights,
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(b) each holder of a right is entitled to receive, on exercise of the additional subscription privilege, the number or amount of securities that is equal to the lesser of
(i) the number or amount of securities subscribed for by the holder under the additional subscription privilege; and
(ii) x(y/z) where
x = the aggregate number or amount of securities available through unexercised rights,
y = the number of rights previously exercised by the holder under the rights offering, and
z = the aggregate number of rights previously exercised under the rights offering by holders of rights that have subscribed for securities under the additional subscription privilege,
(c) any unexercised rights are allocated on a pro rata basis to holders who subscribed for additional securities based on the additional subscription privilege up to the number of securities subscribed for by a particular holder, and
(d) the subscription price of the additional subscription privilege is the same as the subscription price for the basic subscription privilege.
Stand-by commitments
8.4A If there is a stand-by commitment for a rights offering,
(a) the issuer must grant an additional subscription privilege to all holders of rights,
(b) the issuer must deliver to the regulator evidence that the person or company providing the stand-by commitment has the financial ability to carry out the stand-by commitment, and
(c) the subscription price under the stand-by commitment must be the same as the subscription price under the basic subscription privilege.
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Appointment of depository
8.5A(1) If an issuer has stated in the prospectus that no securities will be issued on the exercise of the rights unless a stand-by commitment is provided or unless proceeds at least equal to the stated minimum amount are received by the issuer, all of the following apply:
(a) the issuer must appoint a depository to hold all money received on the exercise of rights until either the stand-by commitment is provided or the stated minimum amount is received;
(b) a depository appointed under paragraph (a) must be
(i) a Canadian financial institution, or
(ii) a registrant in the jurisdiction in which the funds are proposed to be held who is acting as managing dealer for the rights offering, or, if there is no managing dealer for the rights offering, who is acting as a soliciting dealer;
(c) the issuer and the depository must enter into an agreement the terms of which require the depository to return the money in full to the holders of rights that have subscribed for securities under the distribution if either the stand-by commitment is not provided, or the stated minimum is not received by the depository during the exercise period for the rights.
Amendment
8.6A An issuer must not file an amendment to a final prospectus for a rights offering to change the terms of the rights offering.
3. Paragraph 9.2(b) is amended by
a. in subparagraph (iii), replacing “.”with “;”,
b. adding the following after subparagraph (iii):
(iv) Evidence of financial ability – the evidence of financial ability required to be delivered under section 8.4A if it has not previously been delivered; and
(v) Evidence of fair value – the evidence of fair value required to be delivered under subsection 8.2A(2) if it has not previously been delivered..
4. This Instrument comes into force on xx.
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Proposed Amendments to National Instrument 44-101 Short Form Prospectus Distributions
1. National Instrument 44-101 Short Form Prospectus Distributions is amended by this Instrument.
2. Paragraph 4.2(b) is amended by
a. subparagraph (ii), replacing “, and” with “,”,
b. in subparagraph (iii), replacing “.”with “,”, and
c. adding the following after subparagraph (iii):
(iv) the evidence of financial ability required to be delivered under section 8.4A of NI 41-101 if it has not previously been delivered, and
(v) the evidence of fair value required to be delivered under subsection 8.2A(2) of NI 41-101 if it has not previously been delivered..
3. This Instrument comes into force on xx.
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Proposed Amendments to National Instrument 45-102 Resale of Securities
1. National Instrument 45-102 Resale of Securities is amended by this Instrument.
2. Appendix D is amended by adding the following after “Except in Manitoba, the following exemptions from the prospectus requirement in NI 45-106:”:
Section 2.1.2 [Rights offerings – stand-by commitments].
3. Appendix E is amended by
a. replacing “section 2.1 [Rights offering]” with “section 2.1 [Repealed]”, and
b. adding the following after “section 2.1 [Repealed]”:
section 2.1.1 [Rights offerings – reporting issuers] section 2.1.3 [Rights offerings – issuers with a minimal connection to Canada].
4. This Instrument comes into force on xx.
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Annex A2
Proposed Changes to Companion Policy 45-106CP Prospectus and Registration Exemptions
1. Companion Policy 45-106CP Prospectus and Registration Exemptions is changed by this Instrument.
2. Part 3 is changed by adding the following sections:
3.10 Rights offering - reporting issuer
(1) Offer available to all security holders
One of the conditions of the rights offering exemption for reporting issuers in section 2.1.1 of the Instrument is that the issuer must make the basic subscription privilege available on a pro rata basis to every security holder of the class of securities to be distributed on exercise of the rights. This means that the issuer must send notice of the offering to each security holder of the class in the local jurisdiction, regardless of how many security holders reside in the local jurisdiction.
(2) Market price and fair value
Paragraph 2.1.1(4)(b) of the Instrument provides that if there is no published market for the securities, the subscription price must be lower than fair value. The exception to this is set out in subsection 2.1.1(5) which provides that paragraph 2.1.1(4)(b) does not apply if no insider is permitted to increase its proportionate interest in the issuer through the rights offering or a stand- by commitment. Under section 13 of Form 45-106F15, an issuer must explain in its rights offering circular how it determined the fair value of the securities. For these purposes, an issuer could consider a fairness opinion or a valuation.
For the purposes of subsection 2.1.1(4) of the Instrument, if the subscription price falls below the market price or fair value following filing of the notice, insiders will not be prohibited from participating in the offering.
(3) Stand-by commitments
To provide the confirmation in paragraph 2.1.1(7)(b) of the Instrument that the stand-by guarantor has the financial ability to carry out its obligations under the stand-by commitment, the issuer could consider the following:
a statement of net worth attested to by the stand-by guarantor a bank letter of credit the most recent annual audited financial statements of the stand-by guarantor.
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(4) Calculation of number of securities
In calculating the number of outstanding securities for purposes of paragraph 2.1.1(16)(b) of the Instrument, CSA staff generally take the view that
(a) if
x = the number of securities of the class of the securities that may be or have been issued upon the exercise of rights under all rights offerings made by the issuer in reliance on the exemption during the previous 12 months,
y = the maximum number of securities that may be issued upon exercise of rights under the proposed rights offering, and
z = the number of securities of the class of securities that is issuable upon the exercise of rights under the proposed rights offering that are outstanding as of the date of the rights offering circular;
then x + y must be equal to or less than 1, and z
(b) if the convertible securities that may be acquired under the proposed rights offering may be converted before 12 months after the date of the proposed rights offering, the potential increase in outstanding securities, and specifically, “y” in paragraph (a), should be calculated as if the conversion of those convertible securities had occurred.
One of the conditions of the exemption is that the issuer must make the basic subscription privilege available on a pro rata basis to each security holder of the class of securities to be distributed on exercise of the rights. For clarity, this means that an issuer cannot use a rights offering to distribute a new class of securities.
In order to use the exemption in section 2.1.1 of the Instrument for the distribution of securities to a stand-by guarantor (in which case the securities would be subject to a seasoning period on resale), the stand-by guarantor must have been a security holder as at the date the issuer filed the notice. If the stand-by guarantor was not a security holder on that date, the issuer must use the exemption in section 2.1.2 of the Instrument to distribute securities to the stand-by guarantor. The securities would then be subject to a restricted period on resale.
If the stand-by guarantor is a registered dealer, the issuer must use the exemption in section 2.1.2 of the Instrument to distribute securities to the stand-by guarantor even if the guarantor was a security holder. This is to prevent potential backdoor underwriting concerns. We do not believe a registered dealer should be able to immediately resell to the public securities it acquired under a rights offering unless it provides a prospectus or uses another exemption from the prospectus requirement.
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(5) Investment funds
As a reminder, pursuant to section 9.1.1 of National Instrument 81-102 Investment Funds (NI 81- 102), investment funds that are subject to NI 81-102 are restricted from issuing warrants or rights.
3.11 Rights offering – issuer with a minimal connection to Canada
It may be difficult for an issuer to determine beneficial ownership of its securities as a result of the book-based system of holding securities. We are of the view that, for the purpose of determining beneficial ownership to comply with the exemption in section 2.1.3 of the Instrument, procedures comparable to those found in National Instrument 54-101 Communication with Beneficial Owners of Securities of a Reporting Issuer, or any successor instrument, are appropriate..
3. These changes become effective on xx.
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Proposed Changes to Companion Policy 41-101CP General Prospectus Requirements
1. Companion Policy 41-101CP General Prospectus Requirements is changed by this Instrument.
2. Part 2 is changed by adding the following section:
Rights offerings
2.11(1) The regulator may refuse to issue a receipt for a prospectus filed for a rights offering under which rights are issued if the rights are exercisable into convertible securities that require an additional payment by the holder on conversion and the securities underlying the convertible securities are not qualified under the prospectus. This will ensure that the remedies for misrepresentation in the prospectus are available to the person or company who pays value.
(2) Subparagraph 8.2A(1)(d)(ii) of the Instrument provides that if there is no published market for the securities, the subscription price must be lower than fair value. The exception to this is set out in subsection 8.2A(3) which provides that subparagraph 8.2A(1)(d)(ii) does not apply if no insider is permitted to increase its proportionate interest in the issuer through the rights offering or a stand-by commitment. Under subsection 8.2A(2), the issuer must deliver to the regulator evidence of fair value. For this purpose, the regulator will consider such things as fairness opinions, valuations and letters from registered dealers as evidence of the fair value.
(3) Under paragraph 8.4A(b) of the Instrument, if there is a stand-by commitment for a rights offering, the issuer must deliver to the regulator evidence that the person or company providing the stand-by commitment has the financial ability to carry out the stand-by commitment. For this purpose, the regulator may consider any of the following:
a statement of net worth attested to by the person or company making the commitment,
a bank letter of credit,
the most recent audited financial statements of the person or company making the commitment,
other evidence that provides comfort to the regulator..
3. These changes become effective on xx.
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ANNEX B ONTARIO SECURITIES COMMISSION NOTICE AND REQUEST FOR COMMENT
Introduction
The Canadian Securities Administrators (the CSA) are proposing the following changes (collectively, the Proposed Amendments):
amendments to: o National Instrument 45-106 Prospectus and Registration Exemptions including the introduction of . Form 45-106F14 Rights Offering Notice for Reporting Issuers, and . Form 45-106F15 Rights Offering Circular for Reporting Issuers, o Companion Policy 45-106CP Prospectus and Registration Exemptions, o National Instrument 41-101 General Prospectus Requirements, o Companion Policy 41-101CP General Prospectus Requirements, o National Instrument 44-101 Short Form Prospectus Distributions, and o National Instrument 45-102 Resale of Securities. repealing National Instrument 45-101 Rights Offerings (NI 45-101).
Please refer to the CSA’s notice and request for comment.
The purposes of Annex B are to: supplement the CSA’s notice and request for comment, and seek comment on a consequential amendment to OSC Rule 13-502 Fees (OSC Rule 13- 502).
Consequential amendment to OSC Rule 13-502
The Ontario Securities Commission (the OSC) is publishing for a 90-day comment period a proposed amendment to OSC Rule 13-502 as set out in Schedule 1 to this Annex (the OSC Consequential Amendment).
The purpose of the OSC Consequential Amendment is to reflect the new form number of the rights offering circular described in the Proposed Amendments and the proposed repeal of NI 45- 101. Schedule 1 sets out the text of the OSC Consequential Amendment.
Rule-making authority
In Ontario, the following provisions of the Securities Act (the Act) provide the Commission with authority to make the Proposed Amendments and the OSC Consequential Amendment:
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Paragraph 8 of subsection 143(1) of the Act, which authorizes the Commission to make rules in respect of any matter referred to in Part XII (Exemptions from Registration Requirements) as required by the regulations or prescribed by or in the regulations, other than the matters referred to in subsection 35.1(2).
Paragraph 20 of subsection 143(1) of the Act to make rules in respect of any matter referred to in Part XVII (Exemptions from Prospectus Requirements) as required by the regulations or prescribed by or in the regulations, other than the matters referred to in subsection 73.1(3).
Paragraph 13 of subsection 143(1) of the Act authorizes the Commission to make rules regulating trading in or advising about securities or derivatives to prevent trading or advising that is fraudulent, manipulative, deceptive or unfairly detrimental to investors.
Paragraph 39 of subsection 143(1) of the Act authorizes the Commission to make rules requiring or respecting the media, format, preparation, form, content, execution, certification, dissemination and other use, filing and review of all documents required under or governed by this Act, the regulations or the rules and all documents determined by the regulations or the rules to be ancillary to the documents.
Paragraph 43 of subsection 143(1) authorizes the Commission to make rules prescribing the fees payable to the Commission, including those for filing, for applications for registration or exemptions, for trades in securities, in respect of audits made by the Commission, and in connection with the administration of Ontario securities law.
Paragraph 48 of subsection 143(1) authorizes the Commission to make rules specifying the conditions under which any particular type of trade that would not otherwise be a distribution shall be a distribution.
Paragraph 55.2 of subsection 143(1) authorizes the Commission to make rules providing for the application of Part XXIII.1 to the acquisition of an issuer’s security pursuant to a distribution that is exempt from section 53 or 62 and to the acquisition or disposition of an issuer’s security in connection with or pursuant to a takeover bid or issuer bid.
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Schedule 1 Ontario Securities Commission Rule 13-502 Fees
1. Appendix C is amended
(a) in item B(3), by replacing "Form 45-101F" with "Form 45-106F15"
2. This Rule comes into force on ●.
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Chapter 7
Insider Reporting
The following is a weekly summary of insider transactions by insiders of Ontario reporting issuers in SEDI ® (the System for Electronic Disclosure by Insiders).1 The weekly summary contains insider transactions reported during the 7-day period ending Sunday at 11:59 p.m. (i.e. the Sunday prior to the Bulletin Issue date).2
Guide to Codes Relationship of Insider to Issuer (Rel=n)
1 Issuer 2 Subsidiary of Issuer 3 10% Security Holder of Issuer 4 Director of Issuer 5 Senior Officer of Issuer 6 Director or Senior Officer of 10% Security Holder 7 Director or Senior Officer of Insider or Subsidiary of Issuer (other than in 4,5,6) 8 Deemed Insider – 6 Months before becoming Insider
Nature of Transaction (T/O)
00 Opening Balance-Initial SEDI Report 10 Acquisition or disposition in the public market 11 Acquisition or disposition carried out privately 15 Acquisition or disposition under a prospectus 16 Acquisition or disposition under a prospectus exemption 22 Acquisition or disposition pursuant to a take-over bid, merger or acquisition 30 Acquisition or disposition under a purchase/ ownership plan 35 Stock dividend 36 Conversion or exchange 37 Stock split or consolidation 38 Redemption, retraction, cancellation, repurchase 40 Short sale 45 Compensation for property 46 Compensation for services 47 Acquisition or disposition by gift 48 Acquisition by inheritance or disposition by bequest 50 Grant of options 51 Exercise of options 52 Expiration of options 53 Grant of warrants 54 Exercise of warrants 55 Expiration of warrants 56 Grant of rights 57 Exercise of rights 59 Exercise for cash 70 Acquisition or disposition (writing) of third party derivative 71 Exercise of third party derivative 72 Other settlement of third party 73 Expiration of third party derivative 90 Change in nature of ownership 97 Other 99 Correction of Information
Note: The asterisk in the “Date/Month End Holding” column indicates the insider disagreed with the system calculated balance when the transaction was reported.
1 SEDI® is a registered trademark owned by CDS INC. 2 ©CDS INC.
November 27, 2014 (2014), 37 OSCB 10573
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed 3MV Energy Corp. Common Shares Duce, Dallas, Cambell, 4 14/11/2014 36 0.29 25,715,196 3,448,276 Edward 3MV Energy Corp. Common Shares Duce, Dallas, Cambell, 4 14/11/2014 36 0.25 25,769,093 53,897 Edward 3MV Energy Corp. Convertible Debentures Duce, Dallas, Cambell, 4 14/11/2014 36 0.29 $2,000,000 -$1,000,000 Edward Abattis Bioceuticals Corp. Common Shares Sorocco, Douglas 4 07/10/2010 53 0.05 200,000 Abattis Bioceuticals Corp. Common Shares Sorocco, Douglas 4 07/10/2010 53 0.05 200,000 Abattis Bioceuticals Corp. Common Shares Sorocco, Douglas 4 13/05/2011 50 0.35 100,000 Abattis Bioceuticals Corp. Common Shares Sorocco, Douglas 4 13/05/2011 50 0.35 100,000 Abattis Bioceuticals Corp. Common Shares Sorocco, Douglas 4 27/12/2012 50 0.1 75,000 Abattis Bioceuticals Corp. Common Shares Sorocco, Douglas 4 27/12/2012 50 0.1 75,000 Abattis Bioceuticals Corp. Common Shares Sorocco, Douglas 4 01/01/2013 37 -160,000 Abattis Bioceuticals Corp. Common Shares Sorocco, Douglas 4 01/01/2013 37 -160,000 Abattis Bioceuticals Corp. Common Shares Sorocco, Douglas 4 19/03/2013 50 2.2 200,000 Abattis Bioceuticals Corp. Common Shares Sorocco, Douglas 4 19/03/2013 50 2.2 200,000 Abattis Bioceuticals Corp. Common Shares Sorocco, Douglas 4 19/03/2014 50 2.2 200,000 Abattis Bioceuticals Corp. Common Shares Sorocco, Douglas 4 19/03/2014 50 2.2 200,000 Abattis Bioceuticals Corp. Common Shares Sorocco, Douglas 4 01/07/2014 52 2.2 -200,000 Abattis Bioceuticals Corp. Common Shares Sorocco, Douglas 4 01/07/2014 52 2.2 -200,000 Abattis Bioceuticals Corp. Common Shares Sorocco, Douglas 4 23/07/2014 50 0.64 200,000 Abattis Bioceuticals Corp. Common Shares Sorocco, Douglas 4 23/07/2014 50 0.64 200,000 Abattis Bioceuticals Corp. Common Shares Sorocco, Douglas 4 31/03/2014 50 2 200,000 Abattis Bioceuticals Corp. Common Shares Sorocco, Douglas 4 31/03/2014 50 2 200,000 Abattis Bioceuticals Corp. Common Shares Sorocco, Douglas 4 30/06/2014 52 2 -220,000 Abattis Bioceuticals Corp. Common Shares Sorocco, Douglas 4 30/06/2014 52 2 -220,000 Abattis Bioceuticals Corp. Common Shares Sorocco, Douglas 4 23/07/2014 50 0.64 20,000 Abattis Bioceuticals Corp. Common Shares Sorocco, Douglas 4 23/07/2014 50 0.64 200,000 Abattis Bioceuticals Corp. Common Shares Sorocco, Douglas 4 23/07/2014 50 0.64 200,000 Abattis Bioceuticals Corp. Options Sorocco, Douglas 4 13/05/2011 50 0.35 100,000 100,000 Abattis Bioceuticals Corp. Options Sorocco, Douglas 4 27/12/2012 50 0.1 175,000 75,000 Abattis Bioceuticals Corp. Options Sorocco, Douglas 4 19/03/2013 50 2.2 375,000 200,000 Abattis Bioceuticals Corp. Options Sorocco, Douglas 4 01/07/2014 52 2.2 175,000 -200,000 Abattis Bioceuticals Corp. Options Sorocco, Douglas 4 23/07/2014 50 0.64 375,000 200,000 Abattis Bioceuticals Corp. Options Sorocco, Douglas 4 01/06/2011 00 Abattis Bioceuticals Corp. Options Sorocco, Douglas 4 31/03/2014 50 2 200,000 200,000 Abattis Bioceuticals Corp. Options Sorocco, Douglas 4 17/06/2014 52 2 0 -200,000 Abattis Bioceuticals Corp. Options Sorocco, Douglas 4 23/07/2014 50 0.64 200,000 200,000 Abattis Bioceuticals Corp. Warrants Sorocco, Douglas 4 07/10/2010 53 0.05 200,000 200,000 Abattis Bioceuticals Corp. Warrants Sorocco, Douglas 4 01/06/2011 00 Abattis Bioceuticals Corp. Warrants Sorocco, Douglas 4 01/01/2013 37 40,000 -160,000 ABE Resources Inc. Common Shares Richard, Martin 5 17/11/2014 10 0.052 0 -20,000 Abitibi Royalties Inc. Common Shares Ball, Ian 4, 5 17/11/2014 10 2.83 3,375 100 Abitibi Royalties Inc. Common Shares Ball, Ian 4, 5 17/11/2014 10 2.83 3,475 100 Abitibi Royalties Inc. Common Shares Ball, Ian 4, 5 17/11/2014 10 2.83 3,975 500 Abitibi Royalties Inc. Common Shares Ball, Ian 4, 5 18/11/2014 10 2.94 4,075 100 Abitibi Royalties Inc. Common Shares Ball, Ian 4, 5 18/11/2014 10 2.99 4,175 100 Abitibi Royalties Inc. Common Shares Ball, Ian 4, 5 18/11/2014 10 2.94 4,275 100 Abitibi Royalties Inc. Common Shares Ball, Ian 4, 5 18/11/2014 10 2.97 4,475 200 Abitibi Royalties Inc. Common Shares Ball, Ian 4, 5 18/11/2014 10 2.94 4,675 200 Absolute Software Common Shares ESOP Grace, Mark 5 17/11/2014 30 6.49 1,016 -900 Corporation shares Absolute Software Common Shares Libin, Terry 4 20/11/2014 10 524,382 -24,718 Corporation Absolute Software Common Shares Libin, Terry 4 20/11/2014 10 489,382 -35,000 Corporation Absolute Software Common Shares Libin, Terry 4 21/11/2014 10 469,382 -20,000 Corporation ACTIVEnergy Income Fund Trust Units ACTIVEnergy Income Fund 1 17/11/2014 38 7.7 29,692,468 200 ACTIVEnergy Income Fund Trust Units ACTIVEnergy Income Fund 1 19/11/2014 38 7.7 29,692,568 100
November 27, 2014 (2014), 37 OSCB 10574
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Added Capital Inc. Common Shares Northern Financial 4 11/11/2014 50 0.05 100,000 Corporation Added Capital Inc. Common Shares Northern Financial 4 11/11/2014 50 0.05 400,000 100,000 Corporation Aecon Group Inc. Common Shares Tobin, Brian Vincent 4 17/03/2005 00 Aecon Group Inc. Common Shares Tobin, Brian Vincent 4 14/11/2014 10 11.938 4,500 4,500 Aecon Group Inc. Convertible Debentures Tobin, Brian Vincent 4 14/11/2014 10 102 $350,000 $250,000 6.25% Unsecured Subordinated Aegean Metals Group Inc. Warrants Inwentash, Sheldon 3 14/11/2014 55 500,000 -1,750,000 African Queen Mines Ltd. Common Shares Olian, Irwin Alois 3, 4, 5 13/11/2014 10 0.01 11,315,500 127,000 African Queen Mines Ltd. Common Shares Olian, Irwin Alois 3, 4, 5 20/11/2014 10 0.01 11,319,500 4,000 African Queen Mines Ltd. Common Shares Olian, Irwin Alois 3, 4, 5 21/11/2014 10 0.01 11,339,500 20,000 AGF Management Limited Options Stock Option Plan CAMMARERI, ROSE 5 19/11/2014 52 162,836 -25,000 AGF Management Limited Options Stock Option Plan Goldring, Blake Charles 4, 5 19/11/2014 52 717,066 -100,000 AGF Management Limited Options Stock Option Plan Goldring, Judy 4, 5 19/11/2014 52 315,495 -35,000 Agility Health, Inc. Options Herr, Robert Lynn 4 20/11/2014 50 0.25 171,592 30,000 Agility Health, Inc. Options Labbé, Pierre 4 20/11/2014 50 80,000 30,000 Agility Health, Inc. Options Metcalfe, Robert 4 20/11/2014 50 0.25 80,000 30,000 Agrium Inc. Common Shares Douglas, Steven James 5 14/11/2014 10 113.35 13,000 3,000 Agrium Inc. Common Shares Douglas, Steven James 5 18/11/2014 10 113.72 20,000 7,000 Agrium Inc. Options Dyer, Stephen G. 5 17/11/2014 51 100.61 -10,000 Agrium Inc. Options Dyer, Stephen G. 5 17/11/2014 51 100.61 -10,000 Agrium Inc. Options Dyer, Stephen G. 5 17/11/2014 51 100.61 -10,000 Agrium Inc. Options Dyer, Stephen G. 5 17/11/2014 51 100.61 -10,000 Agrium Inc. Options Dyer, Stephen G. 5 17/11/2014 51 100.61 98,703 -10,000 Agrium Inc. Rights SARs Dyer, Stephen G. 5 17/11/2014 56 100.61 10,000 10,000 Agrium Inc. Rights SARs Dyer, Stephen G. 5 17/11/2014 59 100.61 0 -10,000 Agrium Inc. Rights Stock Appreciation Warner, Thomas E. 5 14/11/2014 59 100.47 68,298 -5,000 Rights (SARs) Agrium Inc. Rights Stock Appreciation Warner, Thomas E. 5 17/11/2014 59 100.61 62,298 -6,000 Rights (SARs) Aimia Inc. Common Shares Duchesne, Rupert 4, 5 17/11/2014 10 14.5 95,249 100 Aimia Inc. Common Shares Duchesne, Rupert 4, 5 17/11/2014 10 14.51 95,699 450 Aimia Inc. Common Shares Duchesne, Rupert 4, 5 17/11/2014 10 14.51 95,999 300 Aimia Inc. Common Shares Duchesne, Rupert 4, 5 17/11/2014 10 14.51 96,099 100 Aimia Inc. Common Shares Duchesne, Rupert 4, 5 17/11/2014 10 14.52 97,299 1,200 Aimia Inc. Common Shares Duchesne, Rupert 4, 5 17/11/2014 10 14.52 97,499 200 Aimia Inc. Common Shares Duchesne, Rupert 4, 5 17/11/2014 10 14.5 98,099 600 Aimia Inc. Common Shares Duchesne, Rupert 4, 5 17/11/2014 10 14.49 99,099 1,000 Aimia Inc. Common Shares Duchesne, Rupert 4, 5 17/11/2014 10 14.6 102,099 3,000 Ainsworth Lumber Co. Ltd. Rights Director Deferred Chadwick, Robert 4 19/11/2014 56 136,965 6,372 Share Units Ainsworth Lumber Co. Ltd. Rights Director Deferred Gagne, Paul Ernest 4 19/11/2014 56 84,061 3,911 Share Units Ainsworth Lumber Co. Ltd. Rights Director Deferred Lacey, John Stewart 4 19/11/2014 56 140,101 6,517 Share Units Ainsworth Lumber Co. Ltd. Rights Director Deferred Lancaster, Gordon 4 19/11/2014 56 93,471 4,349 Share Units Ainsworth Lumber Co. Ltd. Rights Director Deferred Paul, Houston 4 19/11/2014 56 129,855 6,041 Share Units Air Canada Class B Voting Shares Forget, Marcel 5 19/11/2014 51 2.34 15,527 9,337 Air Canada Class B Voting Shares Forget, Marcel 5 19/11/2014 10 9.96 6,190 -9,337 Air Canada Class B Voting Shares Forget, Marcel 5 19/11/2014 51 0.96 11,699 5,509 Air Canada Class B Voting Shares Forget, Marcel 5 19/11/2014 10 9.96 6,190 -5,509 Air Canada Class B Voting Shares Forget, Marcel 5 19/11/2014 51 3.04 13,885 7,695 Air Canada Class B Voting Shares Forget, Marcel 5 19/11/2014 10 9.96 6,190 -7,695 Air Canada Class B Voting Shares Forget, Marcel 5 19/11/2014 51 2.49 8,690 2,500 Air Canada Class B Voting Shares Forget, Marcel 5 19/11/2014 10 9.96 6,190 -2,500 Air Canada Options (Long-Term Forget, Marcel 5 19/11/2014 51 2.34 191,115 -9,337 Incentive Plan)
November 27, 2014 (2014), 37 OSCB 10575
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Air Canada Options (Long-Term Forget, Marcel 5 19/11/2014 51 0.96 185,606 -5,509 Incentive Plan) Air Canada Options (Long-Term Forget, Marcel 5 19/11/2014 51 3.04 177,911 -7,695 Incentive Plan) Air Canada Options (Long-Term Forget, Marcel 5 19/11/2014 51 2.49 175,411 -2,500 Incentive Plan) Air Canada Class B Voting Shares Guillemette, Lucie 5 19/11/2014 51 2.34 19,192 7,350 Air Canada Class B Voting Shares Guillemette, Lucie 5 19/11/2014 10 10.11 11,842 -7,350 Air Canada Class B Voting Shares Guillemette, Lucie 5 19/11/2014 51 0.96 17,351 5,509 Air Canada Class B Voting Shares Guillemette, Lucie 5 19/11/2014 10 10.11 11,842 -5,509 Air Canada Class B Voting Shares Guillemette, Lucie 5 19/11/2014 51 3.04 19,537 7,695 Air Canada Class B Voting Shares Guillemette, Lucie 5 19/11/2014 10 10.13 11,842 -7,695 Air Canada Options (Long-Term Guillemette, Lucie 5 19/11/2014 51 2.34 186,678 -7,350 Incentive Plan) Air Canada Options (Long-Term Guillemette, Lucie 5 19/11/2014 51 0.96 181,169 -5,509 Incentive Plan) Air Canada Options (Long-Term Guillemette, Lucie 5 19/11/2014 51 3.04 173,474 -7,695 Incentive Plan) Air Canada Right Rovinescu, Calin 4, 5 01/04/2009 00 Air Canada Right Rovinescu, Calin 4, 5 21/11/2014 97 9.31 1 1 Air Canada Deferred Share Units Wilson, Michael M. 4 01/10/2014 00 Air Canada Deferred Share Units Wilson, Michael M. 4 01/10/2014 00 Air Canada Deferred Share Units Wilson, Michael M. 4 01/10/2014 00 Air Canada Deferred Share Units Wilson, Michael M. 4 13/11/2014 56 9.43 4,374 Air Canada Deferred Share Units Wilson, Michael M. 4 13/11/2014 56 9.43 4,374 Air Canada Deferred Share Units Wilson, Michael M. 4 13/11/2014 56 4,374 4,374 AIRBOSS OF AMERICA Common Shares Matthews, Mary 4 19/11/2014 10 10 50,000 CORP. AIRBOSS OF AMERICA Common Shares Matthews, Mary 4 19/11/2014 10 10 50,000 CORP. AIRBOSS OF AMERICA Common Shares Matthews, Mary 4 19/11/2014 10 9.98 89,002 500 CORP. AIRBOSS OF AMERICA Common Shares Matthews, Mary 4 19/11/2014 10 9.99 89,502 500 CORP. AIRBOSS OF AMERICA Common Shares Matthews, Mary 4 19/11/2014 10 10 138,502 49,000 CORP. Akita Drilling Ltd. Non-Voting Shares Mohan, Harish 4 17/11/2014 30 11.79 6,400 1,000 Akita Drilling Ltd. Non-Voting Shares Wilmot, Harry 4 14/11/2014 00 1,150 AlarmForce Industries Inc. Common Shares Begun, Pavel 4 17/11/2014 10 11.95 353,800 -100 Alba Minerals Ltd. Common Shares Jonsson, Carl Roland 4, 5 09/07/2014 37 52,085 -208,340 Alba Minerals Ltd. Common Shares Jonsson, Carl Roland 4, 5 09/07/2014 37 2,000 -8,000 Alba Minerals Ltd. Options Jonsson, Carl Roland 4, 5 17/12/2012 52 200,000 -75,000 Alba Minerals Ltd. Options Jonsson, Carl Roland 4, 5 11/12/2013 52 175,000 -25,000 Alba Minerals Ltd. Options Jonsson, Carl Roland 4, 5 09/07/2014 37 35,000 -140,000 Alderon Iron Ore Corp. Common Shares Liu, Jian 4 12/11/2014 00 Alderon Iron Ore Corp. Common Shares Wang, Jinhui 4 12/11/2014 00 Alexandra Capital Corp. Options incentive stock Tsitos, Ioannis 4 12/08/2014 00 options Alexandra Capital Corp. Options incentive stock Tsitos, Ioannis 4 31/10/2014 50 125,000 125,000 options Algonquin Power & Utilities Common Shares Samil, Dilek 4 01/10/2014 00 Corp. Algonquin Power & Utilities Rights Deferred Share Samil, Dilek 4 01/10/2014 00 Corp. Units Alimentation Couche-Tard Subordinate Voting Birollo, Bonita Elizabeth 5 05/08/2014 10 30.113 2,200 1,000 Inc. Shares Catégorie B Allegiance Equity Common Shares Bloovol, Marilyn 4, 5 09/03/2004 00 Corporation Allegiance Equity Common Shares Bloovol, Marilyn 4, 5 18/11/2014 22 0.05 501,000 501,000 Corporation Allegiance Equity Warrants Bloovol, Marilyn 4, 5 30/06/2014 55 0.75 0 -700,000 Corporation
November 27, 2014 (2014), 37 OSCB 10576
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Allegiance Equity Common Shares Bloovol, Marilyn Heather 3, 4 18/11/2014 22 0.05 501,000 Corporation Allegiance Equity Common Shares Bloovol, Marilyn Heather 3, 4 18/11/2014 22 0.05 501,000 Corporation Allegiance Equity Common Shares BOYES, WILLIAM SCOTT 3, 4, 5 18/11/2014 00 2,756,000 Corporation Allied Properties Real Estate Units Cunningham, Gordon R. 4 17/11/2014 10 37.18 6,596 -5,000 Investment Trust Almaden Minerals Ltd. Common Shares McCleary, John Daniel 4 19/11/2014 47 1.24 274,050 -19,000 AltaGas Ltd. Common Shares Baines, Jeremy Robert 5 17/11/2014 51 32.84 14,971 1,250 AltaGas Ltd. Common Shares Baines, Jeremy Robert 5 17/11/2014 51 16.6 18,721 3,750 AltaGas Ltd. Common Shares Baines, Jeremy Robert 5 17/11/2014 51 38.63 20,596 1,875 AltaGas Ltd. Common Shares Baines, Jeremy Robert 5 17/11/2014 51 18.15 23,096 2,500 AltaGas Ltd. Common Shares Baines, Jeremy Robert 5 17/11/2014 51 29.85 35,596 12,500 AltaGas Ltd. Common Shares Baines, Jeremy Robert 5 17/11/2014 51 29.32 39,346 3,750 AltaGas Ltd. Common Shares Baines, Jeremy Robert 5 17/11/2014 51 21.05 46,846 7,500 AltaGas Ltd. Common Shares Baines, Jeremy Robert 5 17/11/2014 51 24.92 50,596 3,750 AltaGas Ltd. Options at $16.60 expiring Baines, Jeremy Robert 5 17/11/2014 51 16.6 0 -3,750 August 11, 2019 AltaGas Ltd. Options at $18.15 expiring Baines, Jeremy Robert 5 17/11/2014 51 18.15 0 -2,500 November 9, 2019 AltaGas Ltd. Options at $21.05 expiring Baines, Jeremy Robert 5 17/11/2014 51 21.05 5,000 -7,500 December 16, 2020 AltaGas Ltd. Options at $24.92 expiring Baines, Jeremy Robert 5 17/11/2014 51 24.92 1,250 -3,750 May 12, 2021 AltaGas Ltd. Options at $29.32 expiring Baines, Jeremy Robert 5 17/11/2014 57 29.32 3,750 -3,750 June 7, 2022 AltaGas Ltd. Options at $29.85 expiring Baines, Jeremy Robert 5 17/11/2014 51 29.85 12,500 -12,500 November 25, 2021 AltaGas Ltd. Options at $32.84 expiring Baines, Jeremy Robert 5 17/11/2014 51 32.84 3,750 -1,250 December 6, 2022 AltaGas Ltd. Options at $38.63 expiring Baines, Jeremy Robert 5 17/11/2014 51 38.63 5,625 -1,875 November 7, 2019 AltaGas Ltd. Options at $45.49 expiring Baines, Jeremy Robert 5 01/07/2010 00 November 13, 2020 AltaGas Ltd. Options at $45.49 expiring Baines, Jeremy Robert 5 13/11/2014 50 45.49 3,500 3,500 November 13, 2020 AltaGas Ltd. Common Shares Dawson, Dennis Alan 5 18/11/2014 51 27.03 30,805 2,625 AltaGas Ltd. Common Shares Dawson, Dennis Alan 5 18/11/2014 51 29.85 35,805 5,000 AltaGas Ltd. Common Shares Dawson, Dennis Alan 5 18/11/2014 51 29.32 45,805 10,000 AltaGas Ltd. Common Shares Dawson, Dennis Alan 5 18/11/2014 51 32.84 47,680 1,875 AltaGas Ltd. Common Shares Dawson, Dennis Alan 5 18/11/2014 51 44.5 46,480 -1,200 AltaGas Ltd. Common Shares Dawson, Dennis Alan 5 18/11/2014 51 44.51 44,980 -1,500 AltaGas Ltd. Common Shares Dawson, Dennis Alan 5 18/11/2014 51 44.52 44,380 -600 AltaGas Ltd. Common Shares Dawson, Dennis Alan 5 18/11/2014 51 44.53 43,380 -1,000 AltaGas Ltd. Common Shares Dawson, Dennis Alan 5 18/11/2014 51 44.54 43,280 -100 AltaGas Ltd. Common Shares Dawson, Dennis Alan 5 18/11/2014 51 44.56 43,080 -200 AltaGas Ltd. Common Shares Dawson, Dennis Alan 5 18/11/2014 51 44.6 40,080 -3,000 AltaGas Ltd. Common Shares Dawson, Dennis Alan 5 18/11/2014 51 44.66 39,680 -400 AltaGas Ltd. Common Shares Dawson, Dennis Alan 5 18/11/2014 51 44.7 35,280 -4,400 AltaGas Ltd. Common Shares Dawson, Dennis Alan 5 18/11/2014 51 44.71 34,780 -500 AltaGas Ltd. Common Shares Dawson, Dennis Alan 5 18/11/2014 51 44.73 34,680 -100 AltaGas Ltd. Common Shares Dawson, Dennis Alan 5 18/11/2014 51 44.8 28,180 -6,500 AltaGas Ltd. Options at $27.03 expiring Dawson, Dennis Alan 5 18/11/2014 51 27.03 875 -2,625 September 13, 2021 AltaGas Ltd. Options at $29.32 expiring Dawson, Dennis Alan 5 18/11/2014 51 29.32 10,000 -10,000 June 7, 2022 AltaGas Ltd. Options at $29.85 expiring Dawson, Dennis Alan 5 18/11/2014 51 29.85 5,000 -5,000 November 25, 2021 AltaGas Ltd. Options at $32.84 expiring Dawson, Dennis Alan 5 18/11/2014 51 32.84 5,625 -1,875 December 6, 2022 AltaGas Ltd. Options at $45.49 expiring Green, Jared Blake 5 11/07/2012 00 November 13, 2020
November 27, 2014 (2014), 37 OSCB 10577
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed AltaGas Ltd. Options at $45.49 expiring Green, Jared Blake 5 13/11/2014 50 45.49 5,000 5,000 November 13, 2020 AltaGas Ltd. Options at $45.49 expiring Harris, David Michael 5 01/07/2010 00 November 13, 2020 AltaGas Ltd. Options at $45.49 expiring Harris, David Michael 5 13/11/2014 50 45.49 250,000 250,000 November 13, 2020 AltaGas Ltd. Options at $45.49 expiring Karl, Peter Lauren 5 28/07/2010 00 November 13, 2020 AltaGas Ltd. Options at $45.49 expiring Karl, Peter Lauren 5 13/11/2014 50 45.49 4,000 4,000 November 13, 2020 AltaGas Ltd. Common Shares Larsen, James Christopher 7 17/11/2014 51 39.95 1,500 -1,000 AltaGas Ltd. Common Shares Larsen, James Christopher 7 17/11/2014 51 39.95 0 -1,500 AltaGas Ltd. Options at $45.49 expiring LOWE, JOHN EDWARD 5 03/10/2011 00 November 13, 2020 AltaGas Ltd. Options at $45.49 expiring LOWE, JOHN EDWARD 5 13/11/2014 50 45.49 25,000 25,000 November 13, 2020 AltaGas Ltd. Options at $45.49 expiring Mattson, Bradley 5 01/07/2010 00 November 13, 2020 AltaGas Ltd. Options at $45.49 expiring Mattson, Bradley 5 13/11/2014 50 45.49 2,500 November 13, 2020 AltaGas Ltd. Options at $45.49 expiring Mattson, Bradley 5 13/11/2014 50 45.49 2,500 2,500 November 13, 2020 AltaGas Ltd. Options at $45.49 expiring Moses, Mark Allen 7 30/08/2012 00 November 13, 2020 AltaGas Ltd. Options at $45.49 expiring Moses, Mark Allen 7 13/11/2014 50 45.49 4,000 November 13, 2020 AltaGas Ltd. Options at $45.49 expiring Moses, Mark Allen 7 13/11/2014 50 45.49 4,000 4,000 November 13, 2020 AltaGas Ltd. Options at $45.49 expiring Stein, Deborah Susan 5 01/07/2010 00 November 13, 2020 AltaGas Ltd. Options at $45.49 expiring Stein, Deborah Susan 5 13/11/2014 50 45.49 15,000 15,000 November 13, 2020 AltaGas Ltd. Options at $45.49 expiring Stout, Kent Eugene 5 01/07/2010 00 November 13, 2020 AltaGas Ltd. Options at $45.49 expiring Stout, Kent Eugene 5 13/11/2014 50 45.49 10,000 10,000 November 13, 2020 AltaGas Ltd. Options at $45.49 expiring Toivanen, Shaun William 5 10/01/2011 00 November 13, 2020 AltaGas Ltd. Options at $45.49 expiring Toivanen, Shaun William 5 13/11/2014 50 45.49 3,000 3,000 November 13, 2020 Alterra Power Corp. Common Shares McInnes, Donald Arthur 4 17/11/2014 10 0.315 2,793,197 -10,000 Alterra Power Corp. Common Shares McInnes, Donald Arthur 4 17/11/2014 10 0.32 2,743,197 -50,000 Alterra Power Corp. Common Shares McInnes, Donald Arthur 4 18/11/2014 10 0.32 2,718,197 -25,000 Alterra Power Corp. Common Shares McInnes, Donald Arthur 4 18/11/2014 10 0.325 2,703,197 -15,000 Altitude Resources Inc. Common Shares Wusaty, Eugene 3, 4 21/11/2014 10 0.3 7,229,100 2,000 (formerly Triumph Ventures III Corporation) Amaya Gaming Group Inc. Options israel, rosenthal 5 20/10/2014 00 225,000 Amaya Gaming Group Inc. Options Templer, Guy Nigel 5 20/10/2014 00 225,000 Amica Mature Lifestyles Inc. Common Shares Manjis Holdings Ltd. 3 14/11/2014 10 6.95 2,934,548 3,000 Amica Mature Lifestyles Inc. Common Shares Manjis Holdings Ltd. 3 17/11/2014 10 6.97 2,934,648 100 Amica Mature Lifestyles Inc. Common Shares Manjis Holdings Ltd. 3 17/11/2014 10 6.95 2,935,548 900 Amica Mature Lifestyles Inc. Common Shares Manjis Holdings Ltd. 3 18/11/2014 10 6.97 2,938,648 3,100 Amica Mature Lifestyles Inc. Common Shares Manjis Holdings Ltd. 3 18/11/2014 10 6.95 2,942,948 4,300 Amica Mature Lifestyles Inc. Common Shares Manjis Holdings Ltd. 3 18/11/2014 10 6.94 2,943,148 200 Amica Mature Lifestyles Inc. Common Shares Manjis Holdings Ltd. 3 18/11/2014 10 6.93 2,945,448 2,300 Amica Mature Lifestyles Inc. Common Shares Manjis Holdings Ltd. 3 19/11/2014 10 6.97 2,947,248 1,800 Andrew Peller Limited Class B Voting Shares Kernaghan, Edward James 3 20/11/2014 10 23.24 340,600 -200 (formerly Andrés Wines Ltd.) Andrew Peller Limited Class B Voting Shares Kernaghan, Edward James 3 20/11/2014 10 23 340,500 -100 (formerly Andrés Wines Ltd.) Andrew Peller Limited Class B Voting Shares Kernaghan, Edward James 3 20/11/2014 10 22 339,500 -1,000 (formerly Andrés Wines Ltd.)
November 27, 2014 (2014), 37 OSCB 10578
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Annidis Corporation Promissory Notes 10% Yimai Technology 3 17/11/2014 16 0.35 $3,003,589 $2,003,589 International Company Limited Aptose Biosciences Inc. Common Shares Inwentash, Sheldon 3 17/11/2014 10 7.79 863,600 7,900 Aqua-Pure Ventures Inc. Options Hallman, Alan 4 20/11/2014 50 0.25 370,000 90,000 Arctic Star Exploration Corp. Common Shares Power, Patrick Edward 4, 5 18/11/2014 10 0.04 2,052,866 100,000 Argent Energy Trust Trust Units Bovingdon, Sean 5 14/11/2014 30 1.41 46,786 1,714 Argent Energy Trust Trust Units Wong, Mathew 5 14/11/2014 30 1.41 6,896 1,004 Argentum Silver Corp. Common Shares Cesarone, Carrie 5 11/09/2014 00 Argentum Silver Corp. Common Shares Cesarone, Carrie 5 12/11/2014 16 0.055 50,000 50,000 Argentum Silver Corp. Warrants Cesarone, Carrie 5 11/09/2014 00 Argentum Silver Corp. Warrants Cesarone, Carrie 5 12/11/2014 53 0.1 50,000 50,000 Arsenal Energy Inc. Common Shares Mitchell, Bruce 3 18/11/2014 15 9.95 1,874,592 80,000 Artis Real Estate Investment Deferred Units Ryan, Patrick Gowan 4 14/11/2014 56 15.58 1,732 10 Trust Assiniboia Farmland Limited Limited Partnership Units Emsley, Doug 4, 6, 5 21/11/2014 11 0.25 2,733 -27,769 Partnership Assiniboia Farmland Limited Limited Partnership Units Emsley, Doug 4, 6, 5 21/11/2014 11 0.25 0 -12,976 Partnership Assiniboia Farmland Limited Limited Partnership Units Farquhar, Bradley Douglas 6, 5 21/11/2014 11 0.25 0 -3,779 Partnership Assiniboia Farmland Limited Limited Partnership Units Farquhar, Bradley Douglas 6, 5 21/11/2014 11 0.25 0 -12,976 Partnership Aston Hill Financial Inc. Common Shares Anderson, Peter W. 4 19/11/2014 00 250,000 Aston Hill Financial Inc. Common Shares Cheng, Benedict 4 18/11/2014 10 0.81 884,620 50,000 Aston Hill Financial Inc. Common Shares Cheng, Benedict 4 18/11/2014 10 0.81 20,000 Aston Hill Financial Inc. Common Shares Cheng, Benedict 4 18/11/2014 10 0.81 20,000 Aston Hill Financial Inc. Common Shares Cheng, Benedict 4 19/11/2014 10 0.81 885,120 500 Aston Hill Financial Inc. Common Shares Cheng, Benedict 4 19/11/2014 10 0.82 904,620 19,500 Aston Hill Financial Inc. Common Shares Fielding, John David 4 03/02/2014 00 Aston Hill Financial Inc. Common Shares Fielding, John David 4 19/11/2014 10 0.8 234,500 234,500 Aston Hill Financial Inc. Common Shares TREMBLAY, Eric J.L.M. 4 17/01/2006 00 Aston Hill Financial Inc. Common Shares TREMBLAY, Eric J.L.M. 4 19/11/2014 10 0.853 25,000 25,000 ATCO LTD. Common Shares Class II Heathcott, Linda A. 6, 7 14/02/2014 36 300 -100 ATCO LTD. Common Shares Class II Heathcott, Linda A. 6, 7 14/11/2014 36 -100 ATCO LTD. Common Shares Class II Heathcott, Linda A. 6, 7 14/11/2014 36 -100 ATCO LTD. Non-Voting Shares Class I Heathcott, Linda A. 6, 7 14/02/2014 36 8,292 100 Athabasca Oil Corporation Options Braun, Kevin Edward 5 17/11/2014 52 6.15 158,790 -50,000 Atlantic Gold Corporation Common Shares Dean, Steven G 4, 5 19/11/2014 10 0.25 2,053,000 100,000 (previously Spur Ventures Inc.) Atrium Mortgage Investment Common Shares Sherman, Jeffrey Dennis 5 18/11/2014 10 11.74 4,750 3,000 Corporation Atrium Mortgage Investment Common Shares Sherman, Jeffrey Dennis 5 18/11/2014 30 11.13 5,415 665 Corporation ATS Automation Tooling Defered Share Unit Arnold, Neil D. 4 12/11/2014 46 14.31 72,032 5,939 Systems Inc. ATS Automation Tooling Options Caputo, Anthony 4 13/11/2014 50 14.37 1,303,200 186,200 Systems Inc. ATS Automation Tooling Rights RSU Caputo, Anthony 4 13/11/2014 56 60,177 12,177 Systems Inc. ATS Automation Tooling Options Gyles, Chuck 5 13/11/2014 50 14.37 557,000 21,000 Systems Inc. ATS Automation Tooling Common Shares Hock, Helmut 5 07/03/2011 00 Systems Inc. ATS Automation Tooling Common Shares Hock, Helmut 5 17/11/2014 51 6.6 37,500 37,500 Systems Inc. ATS Automation Tooling Common Shares Hock, Helmut 5 17/11/2014 10 14.2 5,900 -31,600 Systems Inc. ATS Automation Tooling Common Shares Hock, Helmut 5 17/11/2014 10 14.22 5,300 -600 Systems Inc. ATS Automation Tooling Common Shares Hock, Helmut 5 17/11/2014 10 14.23 3,700 -1,600 Systems Inc.
November 27, 2014 (2014), 37 OSCB 10579
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed ATS Automation Tooling Common Shares Hock, Helmut 5 17/11/2014 10 14.24 3,200 -500 Systems Inc. ATS Automation Tooling Common Shares Hock, Helmut 5 17/11/2014 10 14.25 1,100 -2,100 Systems Inc. ATS Automation Tooling Common Shares Hock, Helmut 5 17/11/2014 10 14.26 0 -1,100 Systems Inc. ATS Automation Tooling Common Shares Hock, Helmut 5 17/11/2014 51 6.92 1,300 1,300 Systems Inc. ATS Automation Tooling Common Shares Hock, Helmut 5 17/11/2014 10 14.5 0 -1,300 Systems Inc. ATS Automation Tooling Options Hock, Helmut 5 13/11/2014 50 14.37 222,000 21,000 Systems Inc. ATS Automation Tooling Options Hock, Helmut 5 17/11/2014 51 6.6 184,500 -37,500 Systems Inc. ATS Automation Tooling Options Hock, Helmut 5 17/11/2014 51 6.92 183,200 -1,300 Systems Inc. ATS Automation Tooling Options Ketchen, Sandra Lynne 5 13/11/2014 50 14.37 147,000 21,000 Systems Inc. ATS Automation Tooling Options Keyser, Ron 5 13/11/2014 50 14.37 40,000 8,500 Systems Inc. ATS Automation Tooling Options Kiisel, Eric 5 13/11/2014 50 14.37 102,000 21,000 Systems Inc. ATS Automation Tooling Options Kramer, Tom 5 03/06/2011 50 7.1 10,000 10,000 Systems Inc. ATS Automation Tooling Options Kramer, Tom 5 25/05/2012 50 8.85 20,000 10,000 Systems Inc. ATS Automation Tooling Options Kramer, Tom 5 13/11/2014 50 14.37 191,000 21,000 Systems Inc. ATS Automation Tooling Defered Share Unit McAusland, David L. 4 12/11/2014 46 14.31 73,985 12,228 Systems Inc. ATS Automation Tooling Common Shares McCuaig, Stewart 5 17/11/2014 51 6.92 10,900 10,900 Systems Inc. ATS Automation Tooling Common Shares McCuaig, Stewart 5 17/11/2014 10 14.4 0 -10,900 Systems Inc. ATS Automation Tooling Common Shares McCuaig, Stewart 5 20/11/2014 51 6.92 12,600 12,600 Systems Inc. ATS Automation Tooling Common Shares McCuaig, Stewart 5 20/11/2014 10 14.4 0 -12,600 Systems Inc. ATS Automation Tooling Options McCuaig, Stewart 5 13/11/2014 50 14.37 115,500 21,000 Systems Inc. ATS Automation Tooling Options McCuaig, Stewart 5 17/11/2014 51 6.92 104,600 -10,900 Systems Inc. ATS Automation Tooling Options McCuaig, Stewart 5 19/11/2014 51 6.92 92,000 -12,600 Systems Inc. ATS Automation Tooling Options Perrella, Maria 5 13/11/2014 50 14.37 777,500 45,000 Systems Inc. ATS Automation Tooling Defered Share Unit Presher, Gordon 4 12/11/2014 46 14.31 57,225 5,939 Systems Inc. ATS Automation Tooling Defered Share Unit Wilson, Daryl 4 12/11/2014 46 14.31 66,040 9,083 Systems Inc. Augusta Industries Inc. Common Shares Feldman, Gerald Morris 4 06/10/2010 00 (formerly Fiber Optic Systems Technology, Inc.) Augusta Industries Inc. Common Shares Feldman, Gerald Morris 4 13/11/2014 36 346,338 346,338 (formerly Fiber Optic Systems Technology, Inc.) Augusta Industries Inc. Convertible Debentures Feldman, Gerald Morris 4 13/11/2014 36 $0 -$15,494 (formerly Fiber Optic Systems Technology, Inc.) Augusta Industries Inc. Common Shares Inwentash, Sheldon 6 14/11/2014 10 0.135 54,479,612 224,000 (formerly Fiber Optic Systems Technology, Inc.) Augusta Industries Inc. Common Shares Pinetree Capital Ltd. 3 14/11/2014 10 0.135 52,468,500 224,000 (formerly Fiber Optic Systems Technology, Inc.) Aumento Capital II Common Shares Fielding, John David 4 27/01/2014 00 Corporation
November 27, 2014 (2014), 37 OSCB 10580
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Aumento Capital II Common Shares Fielding, John David 4 11/02/2014 00 Corporation Aumento Capital II Common Shares Fielding, John David 4 11/02/2014 00 55,000 Corporation Aurinia Pharmaceuticals Inc. Options Rowland, Charles 4 29/07/2014 00 Aurinia Pharmaceuticals Inc. Options Rowland, Charles 4 18/11/2014 50 3.91 20,000 20,000 Aurvista Gold Corporation Common Shares Lafleur, Jean 5 11/11/2014 10 0.06 6,000 Aurvista Gold Corporation Common Shares Lafleur, Jean 5 11/11/2014 10 0.075 65,000 4,000 Aurvista Gold Corporation Common Shares Lafleur, Jean 5 11/11/2014 10 0.07 6,000 Aurvista Gold Corporation Common Shares Lafleur, Jean 5 11/11/2014 10 0.075 69,000 4,000 Aurvista Gold Corporation Common Shares Lafleur, Jean 5 11/11/2014 10 0.075 88,000 Aurvista Gold Corporation Common Shares Lafleur, Jean 5 11/11/2014 10 0.075 161,000 92,000 Aurvista Gold Corporation Common Shares Lafleur, Jean 5 12/11/2014 10 0.055 169,000 8,000 Australian REIT Income Trust Units Australian REIT Income 1 19/11/2014 38 10,000 10,000 Fund Fund Australian REIT Income Trust Units Australian REIT Income 1 19/11/2014 38 0 -10,000 Fund Fund AutoCanada Inc. Deferred share units Barefoot, Gordon Ronald 4, 7 15/11/2014 56 2,872 262 AutoCanada Inc. Deferred share units Cumming, Christopher 4 15/11/2014 56 5,368 433 David AutoCanada Inc. Common Shares DesRosiers, Dennis 4 31/12/2009 00 Stephan AutoCanada Inc. Common Shares DesRosiers, Dennis 4 17/11/2014 10 270 270 Stephan AutoCanada Inc. Common Shares DesRosiers, Dennis 4 31/12/2009 00 Stephan AutoCanada Inc. Common Shares DesRosiers, Dennis 4 17/11/2014 10 50 50 Stephan AutoCanada Inc. Common Shares DesRosiers, Dennis 4 31/12/2009 00 Stephan AutoCanada Inc. Common Shares DesRosiers, Dennis 4 17/11/2014 10 655 655 Stephan AutoCanada Inc. Common Shares DesRosiers, Dennis 4 31/12/2009 00 Stephan AutoCanada Inc. Common Shares DesRosiers, Dennis 4 17/11/2014 10 25 25 Stephan AutoCanada Inc. Deferred share units DesRosiers, Dennis 4 15/11/2014 56 3,406 433 Stephan AutoCanada Inc. Deferred share units Ross, Michael 4 15/11/2014 56 4,868 135 Avalon Rare Metals Inc. Common Shares Bubar, Donald Stephen 4, 5 17/11/2014 10 0.22 1,705,000 1,500 Avalon Rare Metals Inc. Common Shares Bubar, Donald Stephen 4, 5 18/11/2014 10 0.22 1,742,000 37,000 Avalon Rare Metals Inc. Common Shares Bubar, Donald Stephen 4, 5 19/11/2014 10 0.22 1,750,000 8,000 BacTech Environmental Common Shares Orr, Murray Ross 7 17/11/2014 36 0.05 1,841,100 232,000 Corporation Bankers Petroleum Ltd. Options Cobo, Leonidha 7 21/01/2011 50 200,000 Bankers Petroleum Ltd. Options Cobo, Leonidha 7 21/01/2011 50 610,000 200,000 Bankers Petroleum Ltd. Options Pawluk, Richard Walter 5 12/11/2014 50 118,000 17,500 Bankers Petroleum Ltd. Restricted Share Units Pawluk, Richard Walter 5 11/08/2008 00 Bankers Petroleum Ltd. Restricted Share Units Pawluk, Richard Walter 5 12/11/2014 56 2,625 2,625 Bannerman Resources Common Shares Ewald, Werner Otto 5 20/11/2014 57 1,627,227 153,743 Limited Bannerman Resources Rights Ewald, Werner Otto 5 20/11/2014 58 - Expiration 3,493,757 -124,135 Limited of rights Bannerman Resources Rights Ewald, Werner Otto 5 20/11/2014 57 3,340,014 -153,743 Limited Bannerman Resources Options Jones, Clive Bruce 4 17/11/2014 52 0.36 1,809,800 -394,000 Limited Bannerman Resources Common Shares Jubber, Leonard Stanley 4 14/11/2014 10 0.07 886,676 332,236 Limited Bannerman Resources Common Shares Jubber, Leonard Stanley 4 20/11/2014 57 1,501,467 614,791 Limited Bannerman Resources Options Jubber, Leonard Stanley 4 17/11/2014 52 0.678 0 -1,500,000 Limited
November 27, 2014 (2014), 37 OSCB 10581
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Bannerman Resources Rights Jubber, Leonard Stanley 4 20/11/2014 58 - Expiration 7,414,751 -547,585 Limited of rights Bannerman Resources Rights Jubber, Leonard Stanley 4 20/11/2014 57 6,799,960 -614,791 Limited Bannerman Resources Common Shares Turney, John Russell 5 20/11/2014 57 230,405 92,906 Limited Bannerman Resources Rights Turney, John Russell 5 20/11/2014 57 98,562 -92,906 Limited Bannerman Resources Rights Turney, John Russell 5 20/11/2014 58 - Expiration 0 -98,562 Limited of rights Banyan Gold Corp. (Formerly Common Shares Class Collins, Allan Jay 3, 4 21/11/2014 10 0.04 3,446,000 100,000 Banyan Coast Capital Corp.) “A” Baytex Energy Corp. Common Shares Melchin, Gregory Knowles 4 14/11/2014 57 15.42 36,378 5,000 Baytex Energy Corp. Incentive Rights Melchin, Gregory Knowles 4 14/11/2014 57 27.72 3,000 -5,000 Bell Aliant Regional Medium Term notes Turcotte, Martine 6 18/02/2011 15 100.75 $1,000 Communications, Limited Series 7 Partnership Bell Aliant Regional Medium Term notes Turcotte, Martine 6 18/02/2011 15 100.75 $100,750 Communications, Limited Series 7 Partnership Bell Aliant Regional Medium Term notes Turcotte, Martine 6 18/02/2011 15 $100,750 $100,750 Communications, Limited Series 7 Partnership Bell Aliant Regional Medium Term notes Turcotte, Martine 6 20/11/2014 36 $0 -$100,750 Communications, Limited Series 7 Partnership Bell Canada Debentures 4.37%, Series Turcotte, Martine 5 13/03/2003 00 M-35 Bell Canada Debentures 4.37%, Series Turcotte, Martine 5 20/11/2014 36 $105,960 $105,960 M-35 Bellatrix Exploration Ltd. Common Shares BLAIR, TIMOTHY 5 14/11/2014 30 5.2021 18,677 741 Bellatrix Exploration Ltd. Common Shares Brown, Edward John 5 14/11/2014 30 5.2021 175,693 757 Bellatrix Exploration Ltd. Common Shares Brown, Edward John 5 14/11/2014 30 5.2021 41,463 392 Bellatrix Exploration Ltd. Common Shares Curry, Christopher Dale 5 14/11/2014 30 5.2021 2,504 752 Bellatrix Exploration Ltd. Common Shares Eshleman, Brent Andrew 5 14/11/2014 30 5.2021 92,730 1,150 Bellatrix Exploration Ltd. Common Shares Gress-Blue, Leanne K. 5 14/11/2014 30 5.2021 48,311 755 Bellatrix Exploration Ltd. Common Shares Kraus, Charles R. 5 14/11/2014 30 5.2021 2,540 961 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 17/11/2014 10 5.1 3,860,847 1,500 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 17/11/2014 10 5.11 3,863,497 2,650 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 17/11/2014 10 5.12 3,865,197 1,700 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 17/11/2014 10 5.13 3,870,197 5,000 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 17/11/2014 10 5.14 3,873,847 3,650 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 17/11/2014 10 5.15 3,883,997 10,150 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 17/11/2014 10 5.22 3,891,897 7,900 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 17/11/2014 10 5.23 3,893,947 2,050 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 17/11/2014 10 5.24 3,894,947 1,000 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 17/11/2014 10 5.25 3,905,747 10,800 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 17/11/2014 10 5.26 3,908,447 2,700 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 17/11/2014 10 5.27 3,909,597 1,150 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 17/11/2014 10 5.28 3,921,897 12,300 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 17/11/2014 10 5.3 3,926,447 4,550 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 18/11/2014 10 5.1 3,932,147 5,700 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 18/11/2014 10 5.11 3,935,547 3,400 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 18/11/2014 10 5.12 3,946,547 11,000 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 18/11/2014 10 5.13 3,970,447 23,900 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 13/11/2014 10 5.15 1,357,700 1,800 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 13/11/2014 10 5.16 1,359,500 1,800 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 13/11/2014 10 5.17 1,360,600 1,100 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 13/11/2014 10 5.18 7,200 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 13/11/2014 10 5.18 7,200 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 13/11/2014 10 5.19 1,376,200 15,600 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 13/11/2014 10 5.2 1,402,700 26,500
November 27, 2014 (2014), 37 OSCB 10582
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 13/11/2014 10 5.24 1,404,800 2,100 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 13/11/2014 10 5.25 1,409,995 5,195 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 13/11/2014 10 5.26 1,413,595 3,600 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 13/11/2014 10 5.27 1,416,500 2,905 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 13/11/2014 10 5.28 1,421,800 5,300 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 13/11/2014 10 5.29 1,423,100 1,300 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 13/11/2014 10 5.3 1,433,600 10,500 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 13/11/2014 10 5.31 1,436,600 3,000 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 13/11/2014 10 5.32 1,442,500 5,900 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 13/11/2014 10 5.33 1,446,600 4,100 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 13/11/2014 10 5.34 1,449,500 2,900 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 13/11/2014 10 5.35 1,456,700 7,200 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 13/11/2014 10 5.18 1,463,900 7,200 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 17/11/2014 10 5.1 1,465,400 1,500 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 17/11/2014 10 5.11 1,468,050 2,650 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 17/11/2014 10 5.12 1,469,750 1,700 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 17/11/2014 10 5.13 1,474,750 5,000 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 17/11/2014 10 5.14 1,478,400 3,650 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 17/11/2014 10 5.15 1,488,550 10,150 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 17/11/2014 10 5.22 1,496,450 7,900 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 17/11/2014 10 5.23 1,498,500 2,050 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 17/11/2014 10 5.24 1,499,500 1,000 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 17/11/2014 10 5.25 1,510,300 10,800 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 17/11/2014 10 5.26 1,513,000 2,700 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 17/11/2014 10 5.27 1,514,150 1,150 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 17/11/2014 10 5.28 1,526,450 12,300 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 17/11/2014 10 5.3 1,531,000 4,550 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 18/11/2014 10 5.1 1,536,700 5,700 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 18/11/2014 10 5.11 1,540,100 3,400 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 18/11/2014 10 5.12 1,551,100 11,000 Bellatrix Exploration Ltd. Common Shares Lewis, Daniel Seth 6 18/11/2014 10 5.13 1,575,000 23,900 Bellatrix Exploration Ltd. Common Shares Nichol, Kelly Malcolm 5 14/11/2014 30 5.2021 36,767 845 Bellatrix Exploration Ltd. Common Shares Oicle, Russell G. 5 14/11/2014 30 5.2021 71,077 975 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 17/11/2014 10 5.1 3,860,847 1,500 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 17/11/2014 10 5.11 3,863,497 2,650 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 17/11/2014 10 5.12 3,865,197 1,700 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 17/11/2014 10 5.13 3,870,197 5,000 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 17/11/2014 10 5.14 3,873,847 3,650 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 17/11/2014 10 5.15 3,883,997 10,150 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 17/11/2014 10 5.22 3,891,897 7,900 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 17/11/2014 10 5.23 3,893,947 2,050 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 17/11/2014 10 5.24 3,894,947 1,000 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 17/11/2014 10 5.25 3,905,747 10,800 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 17/11/2014 10 5.26 3,908,447 2,700 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 17/11/2014 10 5.27 3,909,597 1,150 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 17/11/2014 10 5.28 3,921,897 12,300 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 17/11/2014 10 5.3 3,926,447 4,550 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 18/11/2014 10 5.1 3,932,147 5,700 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 18/11/2014 10 5.11 3,935,547 3,400 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 18/11/2014 10 5.12 3,946,547 11,000 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 18/11/2014 10 5.13 3,970,447 23,900 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 18/11/2014 10 5.1 1,500 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 18/11/2014 10 5.1 1,500 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 13/11/2014 10 5.15 1,357,700 1,800 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 13/11/2014 10 5.16 1,359,500 1,800 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 13/11/2014 10 5.17 1,360,600 1,100 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 13/11/2014 10 5.18 1,367,800 7,200 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 13/11/2014 10 5.19 1,383,400 15,600
November 27, 2014 (2014), 37 OSCB 10583
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 13/11/2014 10 5.2 1,409,900 26,500 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 13/11/2014 10 5.24 1,412,000 2,100 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 13/11/2014 10 5.25 1,417,195 5,195 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 13/11/2014 10 5.26 1,420,795 3,600 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 13/11/2014 10 5.27 1,423,700 2,905 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 13/11/2014 10 5.28 1,429,000 5,300 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 13/11/2014 10 5.29 1,430,300 1,300 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 13/11/2014 10 5.3 1,440,800 10,500 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 13/11/2014 10 5.31 1,443,800 3,000 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 13/11/2014 10 5.32 1,449,700 5,900 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 13/11/2014 10 5.33 1,453,800 4,100 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 13/11/2014 10 5.34 1,456,700 2,900 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 13/11/2014 10 5.35 1,463,900 7,200 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 17/11/2014 10 5.1 1,465,400 1,500 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 17/11/2014 10 5.11 1,468,050 2,650 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 17/11/2014 10 5.12 1,469,750 1,700 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 17/11/2014 10 5.13 1,474,750 5,000 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 17/11/2014 10 5.14 1,478,400 3,650 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 17/11/2014 10 5.15 1,488,550 10,150 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 17/11/2014 10 5.22 1,496,450 7,900 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 17/11/2014 10 5.23 1,498,500 2,050 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 17/11/2014 10 5.24 1,499,500 1,000 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 17/11/2014 10 5.25 1,510,300 10,800 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 17/11/2014 10 5.26 1,513,000 2,700 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 17/11/2014 10 5.27 1,514,150 1,150 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 17/11/2014 10 5.28 1,526,450 12,300 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 17/11/2014 10 5.3 1,531,000 4,550 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 18/11/2014 10 5.1 1,500 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 18/11/2014 10 5.1 1,500 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 18/11/2014 10 5.1 1,536,700 5,700 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 18/11/2014 10 5.11 1,540,100 3,400 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 18/11/2014 10 5.12 1,551,100 11,000 Bellatrix Exploration Ltd. Common Shares Orange Capital, LLC 3 18/11/2014 10 5.13 1,575,000 23,900 Bellatrix Exploration Ltd. Common Shares Smith, Raymond George 4 15/08/2014 30 7.57 485,398 1,100 Bellatrix Exploration Ltd. Common Shares Smith, Raymond George 4 15/09/2014 30 7.6257 486,490 1,092 Bellatrix Exploration Ltd. Common Shares Smith, Raymond George 4 15/10/2014 30 5.4094 488,030 1,540 Bellatrix Exploration Ltd. Common Shares Smith, Raymond George 4 14/11/2014 30 5.2021 489,631 1,601 Bellatrix Exploration Ltd. Common Shares Stephen, Mark Lindsay 5 14/11/2014 30 5.2021 15,963 881 Bellatrix Exploration Ltd. Common Shares Toth, Steve 5 23/10/2014 00 Bellatrix Exploration Ltd. Common Shares Toth, Steve 5 14/11/2014 30 5.2021 720 720 Bellatrix Exploration Ltd. Common Shares Ulmer, Garrett 5 14/11/2014 30 5.2021 24,561 827 Belo Sun Mining Corp. Common Shares DINIZ, HELIO BOTELHO 4, 5 17/11/2014 10 0.105 450,500 500 Belo Sun Mining Corp. Common Shares DINIZ, HELIO BOTELHO 4, 5 19/11/2014 10 0.125 475,000 24,500 Belo Sun Mining Corp. Common Shares DINIZ, HELIO BOTELHO 4, 5 19/11/2014 10 0.12 500,000 25,000 Belo Sun Mining Corp. Options Eaton, Mark Price 4, 5 19/11/2014 50 0.12 3,850,000 650,000 Belo Sun Mining Corp. Options Gleeson, Patrick James 5 19/11/2014 50 0.12 672,000 100,000 Belo Sun Mining Corp. Options Ptolemy, Ryan Jeffery 5 19/11/2014 50 0.12 970,000 120,000 Belo Sun Mining Corp. Options Tagliamonte, Peter Wilson 4 19/11/2014 50 0.12 4,000,000 2,500,000 Berkley Renewables Inc. Common Shares Wayrynen, Matt 4 20/11/2014 10 0.08 1,226,800 7,000 Big Rock Labs Inc. Common Shares Bigue, Stephane 4 19/11/2014 10 1.34 343,500 -4,000 Big Rock Labs Inc. Common Shares Bigue, Stephane 4 19/11/2014 10 1.38 339,000 -4,500 Big Rock Labs Inc. Common Shares Bigue, Stephane 4 20/11/2014 10 1.42 334,000 -5,000 Big Rock Labs Inc. Common Shares PAWLOWICZ, KARL 4 18/11/2014 10 1.28 4,926,450 -5,000 Big Rock Labs Inc. Common Shares PAWLOWICZ, KARL 4 19/11/2014 10 1.35 4,918,450 -8,000 Big Rock Labs Inc. Common Shares PAWLOWICZ, KARL 4 19/11/2014 10 1.38 4,912,950 -5,500 Big Rock Labs Inc. Common Shares PAWLOWICZ, KARL 4 20/11/2014 10 1.38 4,907,950 -5,000 Big Rock Labs Inc. Common Shares PAWLOWICZ, KARL 4 20/11/2014 10 1.25 4,907,750 -200 Big Rock Labs Inc. Common Shares Seemann, Harald 4 17/11/2014 10 1.22 228,982 500
November 27, 2014 (2014), 37 OSCB 10584
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Big Rock Labs Inc. Common Shares Seemann, Harald 4 18/11/2014 10 1.28 223,982 -5,000 Big Rock Labs Inc. Common Shares Seemann, Harald 4 19/11/2014 10 1.35 215,982 -8,000 Big Rock Labs Inc. Common Shares Seemann, Harald 4 19/11/2014 10 1.34 211,982 -4,000 Big Rock Labs Inc. Common Shares Seemann, Harald 4 19/11/2014 10 1.38 207,982 -4,000 Big Rock Labs Inc. Common Shares Seemann, Harald 4 19/11/2014 10 1.38 197,982 -10,000 Big Rock Labs Inc. Common Shares Seemann, Harald 4 19/11/2014 10 1.32 198,182 200 Big Rock Labs Inc. Common Shares Seemann, Harald 4 20/11/2014 10 1.42 188,182 -10,000 Big Rock Labs Inc. Common Shares Seemann, Harald 4 20/11/2014 10 1.38 182,682 -5,500 Big Rock Labs Inc. Common Shares Seemann, Harald 4 20/11/2014 10 1.39 182,782 100 Big Rock Labs Inc. Common Shares Seemann, Harald 4 20/11/2014 10 1.36 184,682 1,900 Big Rock Labs Inc. Common Shares Seemann, Harald 4 20/11/2014 10 1.35 189,682 5,000 Big Rock Labs Inc. Common Shares Seemann, Harald 4 20/11/2014 10 1.3 192,182 2,500 Big Rock Labs Inc. Common Shares Seemann, Harald 4 17/11/2014 10 0.904 8,064,480 -6,000 Big Rock Labs Inc. Common Shares Seemann, Harald 4 20/11/2014 10 0.98 8,053,280 -11,200 Big Rock Labs Inc. Common Shares Seemann, Harald 4 21/11/2014 10 0.99 8,047,980 -5,300 Big Rock Labs Inc. Common Shares Seemann, Harald 4 21/11/2014 10 0.99 8,041,980 -6,000 BioNeutra Global Common Shares Zhang, Fu Zhu 4 04/11/2014 00 2,057,137 Corporation BioSyent Inc. Common Shares Lockhard, Peter Douglas 4 21/11/2014 10 10.85 3,200 -300 Bird Construction Inc. Common Shares Ainley, Matthew David 5 17/11/2014 10 12.05 40,600 20,800 Bird Construction Inc. MTIP - Phantom Shares Ainley, Matthew David 5 20/11/2014 35 7,341 38 Bird Construction Inc. MTIP - Phantom Shares Boyd, Ian Jeffrey 5 20/11/2014 35 37,756 194 Bird Construction Inc. MTIP - Phantom Shares Brennan, James Joseph 5 20/11/2014 35 42,226 218 Bird Construction Inc. MTIP - Phantom Shares CAZA, Charles Joseph 5 20/11/2014 35 14,503 75 Bird Construction Inc. Rights Deferred Share Doyle, Donald Gregory 4 20/11/2014 35 10,182 54 Units Bird Construction Inc. Rights Deferred Share DuPont, Bonnie Dianne 4 20/11/2014 35 9,313 48 Units Rose Bird Construction Inc. MTIP - Phantom Shares Entwistle, Stephen Robert 5 20/11/2014 35 14,846 76 Bird Construction Inc. MTIP - Phantom Shares McClure, Kenneth William 5 20/11/2014 35 39,477 203 Bird Construction Inc. Rights Deferred Share Munkley, Ronald David 4 20/11/2014 35 7,808 41 Units Bird Construction Inc. MTIP - Phantom Shares Nakagawa, Ken 5 20/11/2014 35 21,075 108 Bird Construction Inc. MTIP - Phantom Shares Raboud, Paul Robert 4 20/11/2014 35 37,463 193 Bird Construction Inc. MTIP - Phantom Shares ROYER, GILLES GERALD 5 20/11/2014 35 37,055 191 Bird Construction Inc. MTIP - Phantom Shares Talbott, Timothy James 4 20/11/2014 35 111,032 574 Bird Construction Inc. Rights Deferred Share Thorsteinson, Arni Clayton 4 20/11/2014 35 7,786 40 Units Black Diamond Group Options Blackwood-Skoreyko, 5 03/11/2014 00 Limited Joshua Black Diamond Group Options Blackwood-Skoreyko, 5 13/11/2014 50 18.95 10,000 10,000 Limited Joshua Black Diamond Group Options Buckingham, Ann 5 01/11/2014 00 Limited Black Diamond Group Options Buckingham, Ann 5 13/11/2014 50 18.95 10,000 10,000 Limited BlackPearl Resources Inc. Options Cook, Donald Wayne 5 14/11/2014 50 1.62 1,900,000 250,000 BlackPearl Resources Inc. Options Craig, John Hunter 4 14/11/2014 50 1.62 470,000 100,000 BlackPearl Resources Inc. Options Festival, John Larry 4, 5 14/11/2014 50 1.62 1,900,000 250,000 BlackPearl Resources Inc. Options Hill, Keith Charles 4, 5 14/11/2014 50 1.62 570,000 100,000 BlackPearl Resources Inc. Options Hogue, Chris W. 5 14/11/2014 50 1.62 1,900,000 250,000 BlackPearl Resources Inc. Options Luhowy, Victor M. 4 14/11/2014 50 1.62 570,000 100,000 BlackPearl Resources Inc. Options SOBEL, EDWARD 5 14/11/2014 50 1.62 1,900,000 250,000 BlackPearl Resources Inc. Options SOBEL, EDWARD 5 14/11/2014 50 1.62 100,000 BlackPearl Resources Inc. Options SOBEL, EDWARD 5 14/11/2014 50 1.62 100,000 BNK Petroleum Inc. Options Clark, Wesley Kanne 4 20/11/2014 52 0.63 100,000 -400,000 BNK Petroleum Inc. Options Cross, Robert Melvin 4 20/11/2014 52 0.63 100,000 -1,450,000 Douglas BNK Petroleum Inc. Options Nicholson, Ford 4 20/11/2014 52 0.63 483,000 -1,450,000 BNK Petroleum Inc. Common Shares Payne, Raymond 5 22/09/2014 00 BNK Petroleum Inc. Common Shares Payne, Raymond 5 11/11/2014 10 0.47 60,500 60,500
November 27, 2014 (2014), 37 OSCB 10585
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed BNK Petroleum Inc. Common Shares Payne, Raymond 5 12/11/2014 10 0.51 63,500 3,000 BNK Petroleum Inc. Common Shares Payne, Raymond 5 12/11/2014 10 0.5 110,500 47,000 BNK Petroleum Inc. Common Shares Payne, Raymond 5 14/11/2014 10 0.46 190,500 80,000 BNK Petroleum Inc. Common Shares Payne, Raymond 5 20/11/2014 10 0.46 209,500 19,000 BNK Petroleum Inc. Options Regener, Wolf 4, 5 20/11/2014 52 0.63 508,000 -1,350,000 Boardwalk Real Estate Trust Units Dingle, Ian Peter 5 17/11/2014 10 69.25 1,988 -200 Investment Trust Boston Pizza Royalties Units Brown, William C 4, 5 17/11/2014 10 21.99 296 49 Income Fund Boston Pizza Royalties Units Brown, William C 4, 5 17/11/2014 10 21.99 360 95 Income Fund Boston Pizza Royalties Units Brown, William C 4, 5 17/11/2014 10 21.997 4,564 319 Income Fund Boston Pizza Royalties Units Brown, William C 4, 5 17/11/2014 10 21.99 6,100 100 Income Fund Boston Pizza Royalties Units Merrell, David L. 4 17/11/2014 10 21.88 1,500 500 Income Fund Brand Leaders Plus Income Units Brand Leaders Plus Income 1 19/11/2014 38 7,700 7,700 Fund Fund Brand Leaders Plus Income Units Brand Leaders Plus Income 1 19/11/2014 38 0 -7,700 Fund Fund Brand Leaders Plus Income Units Brand Leaders Plus Income 1 20/11/2014 38 2,500 2,500 Fund Fund Brand Leaders Plus Income Units Brand Leaders Plus Income 1 20/11/2014 38 0 -2,500 Fund Fund BrightPath Early Learning Common Shares BrightPath Early Learning 1 16/10/2014 38 0.3767 30,000 30,000 Inc. (formerly Edleun Group, Inc. Inc.) BrightPath Early Learning Common Shares BrightPath Early Learning 1 20/10/2014 38 0.37 37,000 7,000 Inc. (formerly Edleun Group, Inc. Inc.) BrightPath Early Learning Common Shares BrightPath Early Learning 1 29/10/2014 38 0.3825 57,000 20,000 Inc. (formerly Edleun Group, Inc. Inc.) BrightPath Early Learning Common Shares BrightPath Early Learning 1 31/10/2014 38 0.4 66,000 9,000 Inc. (formerly Edleun Group, Inc. Inc.) BrightPath Early Learning Common Shares BrightPath Early Learning 1 06/11/2014 38 0.4 86,000 20,000 Inc. (formerly Edleun Group, Inc. Inc.) BrightPath Early Learning Common Shares BrightPath Early Learning 1 11/11/2014 38 0.4 91,000 5,000 Inc. (formerly Edleun Group, Inc. Inc.) BrightPath Early Learning Common Shares BrightPath Early Learning 1 13/11/2014 38 0.39 95,500 4,500 Inc. (formerly Edleun Group, Inc. Inc.) BrightPath Early Learning Common Shares BrightPath Early Learning 1 14/11/2014 38 0.3809 101,000 5,500 Inc. (formerly Edleun Group, Inc. Inc.) BrightPath Early Learning Common Shares BrightPath Early Learning 1 17/11/2014 38 0.4 108,000 7,000 Inc. (formerly Edleun Group, Inc. Inc.) BrightPath Early Learning Common Shares BrightPath Early Learning 1 18/11/2014 38 0.4 123,500 15,500 Inc. (formerly Edleun Group, Inc. Inc.) BrightPath Early Learning Common Shares BrightPath Early Learning 1 20/11/2014 00 Inc. (formerly Edleun Group, Inc. Inc.) Brixton Metals Corporation Common Shares Thompson, Gary Robert 6 17/11/2014 10 0.14 544,584 10,000 Brookfield Asset Common Shares Class A Legault, Richard 5 18/11/2014 51 27.298 124,998 90,000 Management Inc. Limited Voting Brookfield Asset Common Shares Class A Legault, Richard 5 18/11/2014 10 56.435 49,998 -75,000 Management Inc. Limited Voting Brookfield Asset Options Legault, Richard 5 18/11/2014 51 27.298 1,025,900 -90,000 Management Inc. Brookfield Infrastructure Limited Partnership Units Hamill, David John 4 30/09/2014 30 38.845 4,190 51 Partners L.P.
November 27, 2014 (2014), 37 OSCB 10586
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Brookfield Infrastructure Limited Partnership Units Hamill, David John 4 13/11/2014 30 40.92 4,227 37 Partners L.P. Brookfield Real Estate Restricted Voting Shares Dean, Simon Paul 4 13/11/2014 10 13.9 8,000 4,000 Services Inc. BTB Real Estate Investment Convertible Debentures Garcia, Claude 4 18/11/2014 10 101.5 $7,000 -$18,000 Trust Série C BURCON NUTRASCIENCE Options Gilpin, John Douglas 4 10/11/2014 50 2.86 100,000 20,000 CORPORATION BURCON NUTRASCIENCE Options willardsen, randy 5 10/11/2014 50 239,554 67,201 CORPORATION Calloway Real Estate Trust Units Young, Michael D'Arcy 4 19/11/2014 47 24.449 175,350 -500 Investment Trust Canaccord Financial Inc. Common Shares Goldberg, Barry 7 23/04/2012 90 -209,759 Canaccord Financial Inc. Common Shares Goldberg, Barry 7 23/04/2013 90 419,532 -209,759 Canaccord Genuity Group Common Shares Davidson, John, Scott 5 20/11/2014 10 9.47 106,481 -50,000 Inc. Canaccord Genuity Group Common Shares Evershed, Philip 4 13/11/2014 10 9.256 340,377 -7,700 Inc. Canaccord Genuity Group Common Shares Evershed, Philip 4 14/11/2014 10 9.2828 228,077 -112,300 Inc. Canaccord Genuity Group Common Shares Evershed, Philip 4 21/11/2014 10 9.5574 28,077 -200,000 Inc. Canaccord Genuity Group Common Shares Goldberg, Barry 7 21/11/2014 10 9.5 99,513 -100,000 Inc. Canaccord Genuity Group Common Shares Harris, Michael Deane 4 23/06/2004 00 Inc. Canaccord Genuity Group Common Shares Harris, Michael Deane 4 19/11/2014 10 9.48 1,000 1,000 Inc. Canaccord Genuity Group Common Shares Pejman, Alidad 5 17/11/2014 10 9.3657 452,358 -50,000 Inc. Canaccord Genuity Group Common Shares Pejman, Alidad 5 18/11/2014 10 9.3903 402,358 -50,000 Inc. Canaccord Genuity Group Common Shares Pejman, Alidad 5 19/11/2014 10 9.3712 392,358 -10,000 Inc. Canaccord Genuity Group Common Shares Reynolds, Paul David 7 20/11/2014 10 9.47 1,446,673 -50,000 Inc. Canadian Apartment Trust Units Schwartz, Thomas 4, 5 14/11/2014 10 25.512 417,561 -250 Properties Real Estate Investment Trust Canadian Apartment Trust Units Schwartz, Thomas 4, 5 14/11/2014 10 25.522 414,361 -3,200 Properties Real Estate Investment Trust Canadian Energy Services & Common Shares Nieboer, Craig Frederick 5 18/11/2014 51 2.06 672,444 120,000 Technology Corp. Canadian Energy Services & Common Shares Nieboer, Craig Frederick 5 18/11/2014 10 9.094 552,444 -120,000 Technology Corp. Canadian Energy Services & Options Nieboer, Craig Frederick 5 18/11/2014 51 2.06 0 -120,000 Technology Corp. Canadian Energy Services & Common Shares Zinger, Kenneth Earl 5 18/11/2014 10 9.28 2,226,070 -30,000 Technology Corp. Canadian Energy Services & Common Shares Zinger, Kenneth Earl 5 20/11/2014 10 9.08 2,196,070 -30,000 Technology Corp. Canadian Imperial Bank of Common Shares Sirois, Charles 4 28/10/2014 30 99.582 16,756 136 Commerce Canadian Natural Resources Common Shares Davis, Randall Scott 5 21/11/2014 10 36.78 89,001 9,000 Limited Canadian Natural Resources Common Shares Davis, Randall Scott 5 21/11/2014 10 42.67 80,001 -9,000 Limited Canadian Natural Resources Options Davis, Randall Scott 5 21/11/2014 51 36.78 103,800 -9,000 Limited Canadian Natural Resources Common Shares McKay, Timothy Shawn 5 21/11/2014 51 10000 10,000 Limited Canadian Natural Resources Common Shares McKay, Timothy Shawn 5 21/11/2014 51 34.385 1,069,203 10,000 Limited Canadian Natural Resources Common Shares McKay, Timothy Shawn 5 21/11/2014 10 42.675 -10,000 Limited
November 27, 2014 (2014), 37 OSCB 10587
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Canadian Natural Resources Common Shares McKay, Timothy Shawn 5 21/11/2014 10 42.675 1,060,315 -8,888 Limited Canadian Natural Resources Common Shares McKay, Timothy Shawn 5 21/11/2014 51 34.385 1,070,315 10,000 Limited Canadian Natural Resources Common Shares McKay, Timothy Shawn 5 21/11/2014 10 42.282 1,061,409 -8,906 Limited Canadian Natural Resources Options McKay, Timothy Shawn 5 21/11/2014 51 34.385 10,000 Limited Canadian Natural Resources Options McKay, Timothy Shawn 5 21/11/2014 51 34.385 1,000,000 -10,000 Limited Canadian Natural Resources Options McKay, Timothy Shawn 5 21/11/2014 51 34.385 10,000 Limited Canadian Natural Resources Options McKay, Timothy Shawn 5 21/11/2014 51 34.385 10,000 Limited Canadian Natural Resources Options McKay, Timothy Shawn 5 21/11/2014 51 34.385 990,000 -10,000 Limited Canadian Natural Resources Common Shares Peterson, William Robert 5 21/11/2014 51 34.385 111,709 10,000 Limited Canadian Natural Resources Common Shares Peterson, William Robert 5 21/11/2014 10 42.44 101,709 -10,000 Limited Canadian Natural Resources Options Peterson, William Robert 5 21/11/2014 51 34.385 384,000 -10,000 Limited Canadian Natural Resources Common Shares Stauth, Scott Gerald 5 21/11/2014 51 28.74 51,954 20,000 Limited Canadian Natural Resources Common Shares Stauth, Scott Gerald 5 21/11/2014 10 42.55 31,954 -20,000 Limited Canadian Natural Resources Options Stauth, Scott Gerald 5 21/11/2014 51 28.74 351,800 -20,000 Limited Canadian Oil Recovery & Common Shares Lorenzo, John Michael 4 17/11/2014 10 0.04 2,696,186 -50,000 Remediation Enterprises Ltd. Canadian Tire Corporation, Non-Voting Shares Class Canadian Tire Corporation, 1 17/11/2014 38 127.44 25,000 25,000 Limited A Limited Canadian Tire Corporation, Non-Voting Shares Class Canadian Tire Corporation, 1 17/11/2014 38 127.44 0 -25,000 Limited A Limited Canadian Tire Corporation, Non-Voting Shares Class Canadian Tire Corporation, 1 18/11/2014 38 126.96 25,000 25,000 Limited A Limited Canadian Tire Corporation, Non-Voting Shares Class Canadian Tire Corporation, 1 18/11/2014 38 126.96 0 -25,000 Limited A Limited Canadian Tire Corporation, Non-Voting Shares Class Canadian Tire Corporation, 1 19/11/2014 38 126.49 25,000 25,000 Limited A Limited Canadian Tire Corporation, Non-Voting Shares Class Canadian Tire Corporation, 1 19/11/2014 38 126.49 0 -25,000 Limited A Limited Canadian Tire Corporation, Non-Voting Shares Class Canadian Tire Corporation, 1 20/11/2014 38 126.49 25,000 Limited A Limited Canadian Tire Corporation, Non-Voting Shares Class Canadian Tire Corporation, 1 20/11/2014 38 126.49 25,000 Limited A Limited Canadian Tire Corporation, Non-Voting Shares Class Canadian Tire Corporation, 1 20/11/2014 38 126.49 -25,000 Limited A Limited Canadian Tire Corporation, Non-Voting Shares Class Canadian Tire Corporation, 1 20/11/2014 38 126.49 -25,000 Limited A Limited Canadian Tire Corporation, Non-Voting Shares Class Canadian Tire Corporation, 1 20/11/2014 38 126.68 19,800 19,800 Limited A Limited Canadian Tire Corporation, Non-Voting Shares Class Canadian Tire Corporation, 1 20/11/2014 38 126.68 0 -19,800 Limited A Limited Canadian Tire Corporation, Non-Voting Shares Class Canadian Tire Corporation, 1 21/11/2014 38 126.51 25,000 25,000 Limited A Limited Canadian Tire Corporation, Non-Voting Shares Class Canadian Tire Corporation, 1 21/11/2014 38 126.51 0 -25,000 Limited A Limited Canadian Tire Corporation, Non-Voting Shares Class MacDonald, Allan Angus 5 13/11/2014 35 105.21 1,796 23 Limited A Canadian Tire Corporation, Non-Voting Shares Class MacDonald, Allan Angus 5 13/11/2014 30 125.68 0 -1,796 Limited A Canadian Utilities Limited Non-Voting Shares Class Heathcott, Linda A. 4 01/09/2014 30 38.346 8,820 86 A Canadian Utilities Limited Non-Voting Shares Class Southern, Nancy C. 4, 6, 7, 5 01/09/2014 30 38.346 149,976 1,038 A
November 27, 2014 (2014), 37 OSCB 10588
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Canadian Utilities Limited Non-Voting Shares Class Wright, Paul 5 19/11/2014 10 40 7,214 -1,000 A Canadian Utilities Limited Non-Voting Shares Class Wright, Paul 5 19/11/2014 30 39.232 7,721 507 A Canadian Western Bank Common Shares Gilpin, Richard Roy 5 10/06/2014 51 39.57 8,399 1,396 Canadian Western Bank Common Shares Gilpin, Richard Roy 5 10/06/2014 51 39.57 9,966 1,567 Canadian Western Bank Common Shares Gilpin, Richard Roy 5 10/06/2014 10 39.534 9,466 -500 Canadian Western Bank Common Shares Gilpin, Richard Roy 5 10/06/2014 10 39.47 7,166 -2,300 Canadian Western Bank Options Gilpin, Richard Roy 5 10/06/2014 51 47,106 -5,447 Canadian Western Bank Options Gilpin, Richard Roy 5 10/06/2014 51 40,066 -7,040 CanElson Drilling Inc. Common Shares Hawkings, Ryan 5 14/11/2014 51 3.22 102,722 34,000 CanElson Drilling Inc. Common Shares Hawkings, Ryan 5 14/11/2014 51 3.95 118,722 16,000 CanElson Drilling Inc. Common Shares Hawkings, Ryan 5 14/11/2014 10 5.47 109,596 -9,126 CanElson Drilling Inc. Options Hawkings, Ryan 5 14/11/2014 51 3.22 116,000 -34,000 CanElson Drilling Inc. Options Hawkings, Ryan 5 14/11/2014 51 3.95 100,000 -16,000 CanElson Drilling Inc. Options Jespersen, Kent 4 14/11/2014 52 6.2 59,000 -37,000 CanElson Drilling Inc. Options Johnson, Dale Patrick 4 14/11/2014 52 6.22 60,000 -21,000 CanElson Drilling Inc. Common Shares Kolasa, Lawrence 5 21/11/2014 51 4 219,711 50,000 CanElson Drilling Inc. Options Kolasa, Lawrence 5 21/11/2014 51 4 100,000 -50,000 CanElson Drilling Inc. Options Kolibar, Daniel George 4 14/11/2014 52 6.2 73,000 -21,000 CanElson Drilling Inc. Options SEAMAN, DONALD ROY 4 19/11/2014 52 6.2 60,000 -21,000 Canlan Ice Sports Corp. Common Shares The Article 6 Marital Trust 3 13/11/2014 10 3.13 1,730,800 2,700 created under the First Amended and Restated Jerry Zucker Revocable Trust dated 4-2-07 Canlan Ice Sports Corp. Common Shares The Article 6 Marital Trust 3 13/11/2014 10 3.15 1,731,800 1,000 created under the First Amended and Restated Jerry Zucker Revocable Trust dated 4-2-07 Canlan Ice Sports Corp. Common Shares The Article 6 Marital Trust 3 13/11/2014 10 3.16 1,733,800 2,000 created under the First Amended and Restated Jerry Zucker Revocable Trust dated 4-2-07 Canlan Ice Sports Corp. Common Shares The Article 6 Marital Trust 3 17/11/2014 10 3.15 1,738,400 4,600 created under the First Amended and Restated Jerry Zucker Revocable Trust dated 4-2-07 Canlan Ice Sports Corp. Common Shares The Article 6 Marital Trust 3 19/11/2014 10 3.15 1,738,500 100 created under the First Amended and Restated Jerry Zucker Revocable Trust dated 4-2-07 Canoe EIT Income Fund Trust Units Chernoff, M. Bruce 3 13/11/2014 54 12.4 872,551 174,510 Canoe EIT Income Fund Trust Units Chernoff, M. Bruce 3 20/11/2014 15 12.4 1,122,551 250,000 Canoe EIT Income Fund Trust Units Chernoff, M. Bruce 3 13/11/2014 54 12.4 6,356 1,271 Canoe EIT Income Fund Trust Units Chernoff, M. Bruce 3 13/11/2014 54 12.4 83,138 13,856 Canoe EIT Income Fund Trust Units Chernoff, M. Bruce 3 14/11/2014 54 12.4 86,602 3,464 Canoe EIT Income Fund Trust Units Chernoff, M. Bruce 3 13/11/2014 54 12.4 247,816 49,563 Canoe EIT Income Fund Warrants Chernoff, M. Bruce 3 13/11/2014 54 12.4 1 -5,084 Canoe EIT Income Fund Warrants Chernoff, M. Bruce 3 14/11/2014 55 0 -1 Canoe EIT Income Fund Warrants Chernoff, M. Bruce 3 13/11/2014 54 12.4 1 -698,040 Canoe EIT Income Fund Warrants Chernoff, M. Bruce 3 14/11/2014 55 0 -1 Canoe EIT Income Fund Warrants Chernoff, M. Bruce 3 13/11/2014 54 12.4 13,858 -55,424 Canoe EIT Income Fund Warrants Chernoff, M. Bruce 3 14/11/2014 54 12.4 2 -13,856 Canoe EIT Income Fund Warrants Chernoff, M. Bruce 3 14/11/2014 55 0 -2 Canoe EIT Income Fund Warrants Chernoff, M. Bruce 3 13/11/2014 54 12.4 1 -198,252 Canoe EIT Income Fund Warrants Chernoff, M. Bruce 3 13/11/2014 55 -1 Canoe EIT Income Fund Warrants Chernoff, M. Bruce 3 14/11/2014 55 0 -1 Canoe EIT Income Fund Trust Units Rain, David James 4 14/11/2014 54 12.4 2,465 591 Canoe EIT Income Fund Warrants Rain, David James 4 14/11/2014 54 12.4 1 -2,364
November 27, 2014 (2014), 37 OSCB 10589
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Canoe EIT Income Fund Warrants Rain, David James 4 14/11/2014 55 12.4 0 -1 Canoe Mining Ventures Common Shares Kelly, Scott 4 18/11/2014 10 0.16 625,200 75,000 Corp. Canoe Mining Ventures Common Shares Kelly, Scott 4 19/11/2014 10 0.16 650,000 24,800 Corp. Canoe Mining Ventures Common Shares Parnham, Duane 4, 5 18/11/2014 10 0.16 1,097,173 150,000 Corp. Canoe Mining Ventures Common Shares Parnham, Duane 4, 5 19/11/2014 10 0.16 1,176,673 79,500 Corp. Canoe Mining Ventures Common Shares Parnham, Duane 4, 5 18/11/2014 10 0.16 349,340 16,000 Corp. CanWel Building Materials Common Shares Doman, Amardeip Singh 4 19/11/2014 10 6.15 8,608,754 30,100 Group Ltd. (formerly, Canwel Holdings Corporation) CanWel Building Materials Common Shares Doman, Amardeip Singh 4 20/11/2014 10 6.12 8,613,754 5,000 Group Ltd. (formerly, Canwel Holdings Corporation) CanWel Building Materials Common Shares Doman, Amardeip Singh 4 20/11/2014 10 6.15 8,620,254 6,500 Group Ltd. (formerly, Canwel Holdings Corporation) CanWel Building Materials Common Shares Doman, Amardeip Singh 4 20/11/2014 10 6.17 8,620,554 300 Group Ltd. (formerly, Canwel Holdings Corporation) CanWel Building Materials Common Shares Doman, Amardeip Singh 4 20/11/2014 10 6.18 8,621,754 1,200 Group Ltd. (formerly, Canwel Holdings Corporation) CanWel Building Materials Common Shares Doman, Amardeip Singh 4 20/11/2014 10 6.19 8,621,954 200 Group Ltd. (formerly, Canwel Holdings Corporation) CanWel Building Materials Common Shares Doman, Amardeip Singh 4 20/11/2014 10 6.2 8,622,954 1,000 Group Ltd. (formerly, Canwel Holdings Corporation) CanWel Building Materials Common Shares Doman, Amardeip Singh 4 20/11/2014 10 6.21 8,624,654 1,700 Group Ltd. (formerly, Canwel Holdings Corporation) CanWel Building Materials Common Shares Rosenfeld, Harry 6 20/11/2014 10 6.12 65,421 315 Group Ltd. (formerly, Canwel Holdings Corporation) Canyon Services Group Inc. Common Shares MULLEN, Kenneth Brandon 4 17/03/2014 00 Canyon Services Group Inc. Common Shares MULLEN, Kenneth Brandon 4 18/11/2014 10 11 5,000 5,000 Cargojet Inc. Common Voting Shares Virmani, Ajay Kumar 5 13/11/2014 10 25 1,421,500 21,500 Carlisle Goldfields Limited Common Shares AuRico Gold Inc. 3 20/11/2014 16 0.08 70,600,000 70,600,000 Carlisle Goldfields Limited Common Shares Drost, Abraham Peter 4, 5 21/11/2014 10 0.04 6,000,000 1,000,000 Cathedral Energy Services Common Shares SARJEANT, SCOTT 4 20/11/2014 10 3.3 10,600 600 Ltd. DOUGLAS Cayden Resources Inc. Common Shares Cook, Steven Mark 4 18/11/2014 51 165,000 75,000 Cayden Resources Inc. Options Cook, Steven Mark 4 18/11/2014 51 125,000 -50,000 Cayden Resources Inc. Options Cook, Steven Mark 4 18/11/2014 51 100,000 -25,000 CCL Industries Inc. Non-Voting Shares Class Horn, Alan Douglas 4 17/11/2014 10 120.96 24,500 -500 B CCL Industries Inc. Non-Voting Shares Class Horn, Alan Douglas 4 17/11/2014 10 120.95 23,500 -1,000 B CCL Industries Inc. Non-Voting Shares Class Horn, Alan Douglas 4 17/11/2014 10 120.92 23,100 -400 B CCL Industries Inc. Non-Voting Shares Class Horn, Alan Douglas 4 17/11/2014 10 120.91 23,000 -100 B CCL Industries Inc. Non-Voting Shares Class Horn, Alan Douglas 4 17/11/2014 10 120.9 20,600 -2,400 B CCL Industries Inc. Non-Voting Shares Class Horn, Alan Douglas 4 17/11/2014 10 120.86 20,500 -100 B CCL Industries Inc. Non-Voting Shares Class Horn, Alan Douglas 4 17/11/2014 10 120.85 20,200 -300 B CCL Industries Inc. Non-Voting Shares Class Horn, Alan Douglas 4 17/11/2014 10 120.41 19,200 -1,000 B CCL Industries Inc. Non-Voting Shares Class Horn, Alan Douglas 4 17/11/2014 10 120.19 19,100 -100 B
November 27, 2014 (2014), 37 OSCB 10590
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed CCL Industries Inc. Non-Voting Shares Class Horn, Alan Douglas 4 17/11/2014 10 120.18 18,500 -600 B CCL Industries Inc. Non-Voting Shares Class Horn, Alan Douglas 4 17/11/2014 10 120.03 18,400 -100 B CCL Industries Inc. Non-Voting Shares Class Horn, Alan Douglas 4 17/11/2014 10 120.02 18,100 -300 B CCL Industries Inc. Non-Voting Shares Class Horn, Alan Douglas 4 17/11/2014 10 120 15,000 -3,100 B Centric Health Corporation Restricted Stock Units Hensman, Evelyn 5 13/11/2014 30 0.39 20,017 10,017 (formerly Alegro Health Corp.) Centric Health Corporation Restricted Stock Units Mason, Diane Lynn 5 13/11/2014 30 0.39 113,157 10,017 (formerly Alegro Health Corp.) Centric Health Corporation Restricted Stock Units Matthews, Tim 5 13/11/2014 30 0.39 65,042 25,042 (formerly Alegro Health Corp.) Ceres Global Ag Corp. Common Shares Mize, Gary 4 27/09/2013 00 Ceres Global Ag Corp. Common Shares Mize, Gary 4 17/11/2014 10 5.2 5,000 5,000 Cerro Grande Mining Common Shares Thomson, David Robert 4, 5 12/11/2014 11 0.01 19,627,704 19,627,704 Corporation Stanley Cerro Grande Mining Common Shares Thomson, David Robert 4, 5 12/11/2014 11 0.01 4,327,995 4,327,995 Corporation Stanley Cerro Grande Mining Common Shares Thomson, David Robert 4, 5 12/11/2014 11 0.01 4,327,995 4,327,995 Corporation Stanley Cerro Grande Mining Common Shares Thomson, David Robert 4, 5 12/11/2014 11 0.01 15,669,593 -28,283,694 Corporation Stanley Cervus Equipment Common Shares Deferred Drake, Graham 4 17/11/2014 56 18.17 36,339 2,752 Corporation Shares Cervus Equipment Common Shares Deferred Higgins, John C. 5 17/11/2014 56 18.17 33,923 2,752 Corporation Shares Cervus Equipment Common Shares Deferred Hnatiw, Frederick Charles 5 17/11/2014 56 18.17 16,334 1,871 Corporation Shares Cervus Equipment Common Shares Deferred Johnson, Calvin Lorne 5 17/11/2014 56 18.17 66,684 2,752 Corporation Shares Cervus Equipment Common Shares Deferred Muth, Randall Walter 5 17/11/2014 56 18.17 71,537 2,752 Corporation Shares CGI Group Inc. Options Algra, Sake 5 17/11/2014 97 37.11 76,566 -15,311 CGI Group Inc. Options Anderson, David 5 19/11/2014 51 12.54 345,063 -15,000 CGI Group Inc. Options Anderson, David 5 19/11/2014 51 12.54 330,063 -15,000 CGI Group Inc. Options Anderson, David 5 19/11/2014 51 12.54 325,063 -5,000 CGI Group Inc. Options Anderson, David 5 19/11/2014 51 12.54 320,063 -5,000 CGI Group Inc. Options Anderson, David 5 19/11/2014 51 12.54 315,063 -5,000 CGI Group Inc. Options Anderson, David 5 19/11/2014 51 12.54 310,063 -5,000 CGI Group Inc. Options Anderson, David 5 19/11/2014 51 12.54 305,063 -5,000 CGI Group Inc. Options Anderson, David 5 19/11/2014 51 12.54 300,063 -5,000 CGI Group Inc. Options Anderson, David 5 19/11/2014 51 12.54 295,063 -5,000 CGI Group Inc. Options Anderson, David 5 19/11/2014 51 12.54 285,063 -10,000 CGI Group Inc. Options Anderson, David 5 19/11/2014 51 12.54 275,063 -10,000 CGI Group Inc. Options Anderson, David 5 19/11/2014 51 12.54 265,063 -10,000 CGI Group Inc. Options Anderson, David 5 19/11/2014 51 12.54 255,063 -10,000 CGI Group Inc. Options Anderson, David 5 19/11/2014 51 12.54 250,063 -5,000 CGI Group Inc. Options Anderson, David 5 19/11/2014 51 12.54 240,063 -10,000 CGI Group Inc. Options Anderson, David 5 19/11/2014 51 12.54 230,063 -10,000 CGI Group Inc. Options Anderson, David 5 19/11/2014 51 12.54 220,063 -10,000 CGI Group Inc. Options Anderson, David 5 19/11/2014 51 12.54 210,063 -10,000 CGI Group Inc. Options Anderson, David 5 19/11/2014 51 12.54 200,063 -10,000 CGI Group Inc. Options Anderson, David 5 19/11/2014 51 12.54 195,063 -5,000 CGI Group Inc. Options Anderson, David 5 19/11/2014 51 12.54 188,188 -6,875 CGI Group Inc. Options Anderson, David 5 19/11/2014 51 15.49 185,063 -3,125 CGI Group Inc. Options Anderson, David 5 19/11/2014 51 15.49 180,063 -5,000 CGI Group Inc. Rights Performance Share Anderson, David 5 17/11/2014 97 37.115 227,456 -35,427 Units
November 27, 2014 (2014), 37 OSCB 10591
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 51 12.54 15,000 15,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 10 41.772 0 -15,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 50 12.54 15,000 15,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 10 41.452 0 -15,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 51 12.54 5,000 5,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 10 41.606 0 -5,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 51 12.54 5,000 5,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 10 416392 0 -5,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 50 12.54 5,000 5,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 10 41.65 0 -5,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 51 12.54 5,000 5,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 10 41.569 0 -5,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 51 12.54 5,000 5,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 10 41.529 0 -5,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 51 12.54 5,000 5,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 10 41.57 0 -5,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 51 12.54 10,000 10,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 10 41.561 0 -10,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 51 12.54 10,000 10,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 10 41.55 0 -10,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 51 12.54 10,000 10,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 10 41.591 0 -10,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 51 12.54 10,000 10,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 10 41.582 0 -10,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 51 12.54 5,000 5,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 10 41.567 0 -5,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 51 12.54 10,000 10,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 10 41.571 0 -10,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 51 12.54 10,000 10,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 10 41.579 0 -10,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 50 12.54 10,000 10,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 10 41.534 0 -10,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 50 12.54 10,000 10,000 Shares Classe A
November 27, 2014 (2014), 37 OSCB 10592
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 10 41.675 0 -10,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 51 12.544 10,000 10,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 10 41.55 0 -10,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 51 12.54 5,000 5,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 10 41.531 0 -5,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 51 12.54 6,875 6,875 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 10 41.54 0 -6,875 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 51 15.49 3,125 3,125 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 10 41.586 0 -3,125 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 51 15.49 5,000 5,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 51 15.49 5,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 51 15.49 5,000 Shares Classe A CGI Group Inc. Subordinate Voting Anderson, David 5 19/11/2014 10 41.6 0 -5,000 Shares Classe A CGI Group Inc. Options ASTON, MARK 5 17/11/2014 97 37.11 25,921 -1,298 CGI Group Inc. Options Baptista, Joao Pedro 5 17/11/2014 97 36.15 294,788 -59,072 Amandey CGI Group Inc. Options Baticle, Jean-Michel 5 17/11/2014 97 36.15 176,374 -19,046 CGI Group Inc. Options Bauer, Ralf 5 17/11/2014 97 38.79 33,946 -15,930 CGI Group Inc. Options Bernard, Réjean 5 17/11/2014 97 37.11 208,582 -17,865 CGI Group Inc. Options Bouchard (dirigeant), Alain 5 17/11/2014 97 37.11 45,054 -9,528 CGI Group Inc. Options Bouchard (dirigeant), Alain 5 19/11/2014 51 8.55 43,854 -1,200 CGI Group Inc. Subordinate Voting Bouchard (dirigeant), Alain 5 19/11/2014 51 8.55 1,200 1,200 Shares Classe A CGI Group Inc. Subordinate Voting Bouchard (dirigeant), Alain 5 19/11/2014 10 41.682 0 -1,200 Shares Classe A CGI Group Inc. Options Bouchard, Alain 4 17/11/2014 97 36.15 17,684 -1,558 CGI Group Inc. Options Boulanger, François 5 17/11/2014 97 37.11 199,468 -6,037 CGI Group Inc. Options Bourigeaud, Bernard 4 17/11/2014 97 36.15 22,277 -1,558 CGI Group Inc. Options Bouron, Philipp 5 13/11/2013 50 37.11 40,000 CGI Group Inc. Options Bouron, Philipp 5 13/11/2013 50 37.11 80,000 40,000 CGI Group Inc. Options Bouron, Philipp 5 17/11/2014 97 37.11 81,050 -24,327 CGI Group Inc. Options Boyajian, Mark 5 17/11/2014 97 37.11 47,613 -11,948 CGI Group Inc. Options Boyajian, Mark 5 18/11/2014 51 15.49 45,582 -2,031 CGI Group Inc. Options Boyajian, Mark 5 18/11/2014 51 19.71 41,641 -3,941 CGI Group Inc. Options Boyajian, Mark 5 18/11/2014 51 23.65 37,113 -4,528 CGI Group Inc. Subordinate Voting Boyajian, Mark 5 18/11/2014 51 15.49 2,031 2,031 Shares Classe A CGI Group Inc. Subordinate Voting Boyajian, Mark 5 18/11/2014 51 19.71 5,972 3,941 Shares Classe A CGI Group Inc. Subordinate Voting Boyajian, Mark 5 18/11/2014 51 23.65 10,500 4,528 Shares Classe A CGI Group Inc. Subordinate Voting Boyajian, Mark 5 18/11/2014 10 41.25 0 -10,500 Shares Classe A CGI Group Inc. Options Brassard, Jean 4 17/11/2014 97 36.15 40,838 -1,558 CGI Group Inc. Options Campbell, Cheryl 5 17/11/2014 97 36.15 169,612 -65,257 CGI Group Inc. Options Chandramouli, Srinivasan 5 17/11/2014 97 37.11 169,591 -3,246 CGI Group Inc. Options Chevrier, Robert 4 17/11/2014 97 36.15 92,900 -1,558 CGI Group Inc. Options Chevrier, Robert 4 18/11/2014 51 7.69 91,144 -1,756 CGI Group Inc. Options Chevrier, Robert 4 18/11/2014 51 7 90,180 -964 CGI Group Inc. Options Chevrier, Robert 4 18/11/2014 51 7.32 89,258 -922
November 27, 2014 (2014), 37 OSCB 10593
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed CGI Group Inc. Options Chevrier, Robert 4 18/11/2014 51 8.35 88,450 -808 CGI Group Inc. Options Chevrier, Robert 4 18/11/2014 51 8.55 84,450 -4,000 CGI Group Inc. Options Chevrier, Robert 4 18/11/2014 51 9.4 83,679 -771 CGI Group Inc. Options Chevrier, Robert 4 18/11/2014 51 7.72 79,679 -4,000 CGI Group Inc. Subordinate Voting Chevrier, Robert 4 18/11/2014 51 7.69 1,756 1,756 Shares Classe A CGI Group Inc. Subordinate Voting Chevrier, Robert 4 18/11/2014 51 7 2,720 964 Shares Classe A CGI Group Inc. Subordinate Voting Chevrier, Robert 4 18/11/2014 51 7.32 3,642 922 Shares Classe A CGI Group Inc. Subordinate Voting Chevrier, Robert 4 18/11/2014 51 8.35 4,450 808 Shares Classe A CGI Group Inc. Subordinate Voting Chevrier, Robert 4 18/11/2014 51 8.55 8,450 4,000 Shares Classe A CGI Group Inc. Subordinate Voting Chevrier, Robert 4 18/11/2014 51 9.4 9,221 771 Shares Classe A CGI Group Inc. Subordinate Voting Chevrier, Robert 4 18/11/2014 51 7.72 13,221 4,000 Shares Classe A CGI Group Inc. Subordinate Voting Chevrier, Robert 4 18/11/2014 10 41.759 0 -13,221 Shares Classe A CGI Group Inc. Options Cofran, Jame 5 17/11/2014 97 37.11 78,197 -7,790 CGI Group Inc. Options CUNNINGHAM, KEVIN 5 17/11/2014 97 37.11 26,992 -3,008 ANTHONY CGI Group Inc. Options D'Alessandro, Dominic 4 17/11/2014 97 36.15 48,016 -1,558 CGI Group Inc. Options d'Aquino, Thomas Paul 4 17/11/2014 97 36.15 45,242 -1,558 CGI Group Inc. Options DEBU, FABIEN 5 17/11/2014 97 37.11 52,191 -5,497 CGI Group Inc. Options Delgado, Samuel David 5 17/11/2014 97 37.11 70,988 -16,035 CGI Group Inc. Options Derby, Shawn Roger 5 17/11/2014 97 37.11 43,255 -3,610 CGI Group Inc. Options Doré, Paule 4 17/11/2014 97 36.15 27,142 -1,558 CGI Group Inc. Options Dougherty, Francis Patrick 5 17/11/2014 97 37.11 26,628 -6,372 CGI Group Inc. Options Dube, Benoit 5 17/11/2014 97 37.11 155,564 -13,633 CGI Group Inc. Options Dubrana, Serge 5 17/11/2014 97 36.15 212,921 -44,111 CGI Group Inc. Options Evans, Richard B. 4 17/11/2014 97 36.15 53,167 -1,558 CGI Group Inc. Options FITZPATRICK, DAVID 5 17/11/2014 97 37.11 105,482 -3,895 SAMUEL CGI Group Inc. Options Foggo, Melba 5 17/11/2014 97 37.11 45,362 -4,170 CGI Group Inc. Options Fors, Par 5 17/11/2014 97 37.11 80,637 -23,895 CGI Group Inc. Options Gillespie, Sandra 5 17/11/2014 97 37.11 30,369 -4,631 CGI Group Inc. Options Godin, Julie 4 17/11/2014 97 37.11 154,810 -13,633 CGI Group Inc. Options Godin, Michael 5 17/11/2014 97 37.11 34,288 -11,016 CGI Group Inc. Rights Performance Share Godin, Serge 3, 4 17/11/2014 97 37.115 893,187 -103,019 Units CGI Group Inc. Options Gonçalves, José Carlos 5 17/11/2014 97 37.11 70,637 -13,895 CGI Group Inc. Options Gorber, Lorne Shawn 5 17/11/2014 97 37.11 58,772 -5,842 CGI Group Inc. Options Gorzen, Dariusz 5 17/11/2014 97 37.11 22,935 -7,965 CGI Group Inc. Options Gregory, Timothy Walter 5 17/11/2014 97 36.15 282,595 -11,585 CGI Group Inc. Options Henderson, Dave 5 17/11/2014 97 37.11 90,427 -13,895 CGI Group Inc. Options Holgate, Colin Victor 5 17/11/2014 97 36.15 243,523 -13,324 CGI Group Inc. Options Hudson, Roy John 5 17/11/2014 97 37.11 67,801 -17,865 CGI Group Inc. Options Hurlebaus, Timothy 5 17/11/2014 97 37.11 52,534 -15,930 CGI Group Inc. Options Imbeau, André 3, 4, 5 17/11/2014 97 36.15 117,808 -1,558 CGI Group Inc. Options James, Christopher Earl 4 17/11/2014 97 37.11 108,873 -13,895 CGI Group Inc. Options Jaques, John 5 17/11/2014 97 37.11 24,964 -13,610 CGI Group Inc. Options JAUBERT, STÉPHANE 5 17/11/2014 97 37.11 51,624 -6,064 CGI Group Inc. Options KIRCHHOFFER, DAVID 5 17/11/2014 97 37.11 52,358 -7,330 CGI Group Inc. Options Kirk, Thomas Clark 5 17/11/2014 97 37.11 58,883 -9,263 CGI Group Inc. Options Koivisto, Kimmo 5 17/11/2014 97 37.11 36,536 -10,730 CGI Group Inc. Options Labbé, Gilles 4 17/11/2014 97 36.15 41,964 -1,558 CGI Group Inc. Options Labelle, Bernard 5 17/11/2014 97 37.11 87,953 -5,842 CGI Group Inc. Options Lahteenmaa, Leena-Mari 5 17/11/2014 97 37.11 58,958 -10,730 CGI Group Inc. Options Lakhlifi, Mohamed 5 17/11/2014 97 37.11 41,291 -4,397
November 27, 2014 (2014), 37 OSCB 10594
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed CGI Group Inc. Options LE FRANC, GILLES 5 17/11/2014 97 37.11 47,951 -7,737 CGI Group Inc. Options lindeborg, Jorgen 5 17/11/2014 97 38.79 27,144 -15,930 CGI Group Inc. Options Linder, Kevin Morris 4 17/11/2014 97 37.1 26,152 -1,947 CGI Group Inc. Options Loiselle, Lucie 5 17/11/2014 97 37.11 72,033 -2,531 CGI Group Inc. Options MacDonald, Marie Theresa 5 17/11/2014 97 37.11 212,025 -10,595 CGI Group Inc. Options MacIsaac, John Benedict 5 02/12/2013 51 15.49 -18,750 CGI Group Inc. Options MacIsaac, John Benedict 5 02/12/2013 51 15.49 59,919 -18,750 CGI Group Inc. Options MacIsaac, John Benedict 5 17/11/2014 97 37.11 69,676 -5,243 CGI Group Inc. Options Maglis, Eva 5 17/11/2014 97 37.11 327,748 -7,790 CGI Group Inc. Options MALHOMME, MICHEL 5 17/11/2014 97 37.11 36,015 -4,829 CGI Group Inc. Options Marcoux, Claude 5 17/11/2014 97 36.15 325,549 -41,901 CGI Group Inc. Options MARTIN, PIERRE- 5 30/08/2013 00 DOMINIQUE CGI Group Inc. Options MARTIN, PIERRE- 5 30/08/2013 00 20,000 DOMINIQUE CGI Group Inc. Options MARTIN, PIERRE- 5 17/11/2014 97 37.11 49,931 -5,757 DOMINIQUE CGI Group Inc. Options McCuaig, Douglas 5 17/11/2014 97 37.11 287,589 -9,738 CGI Group Inc. Options MCGEEHAN, TARA 5 17/11/2014 97 37.11 68,104 -3,506 CGI Group Inc. Options MOHSENI, SADJAI 5 17/11/2014 97 37.11 50,524 -7,164 SASSAN CGI Group Inc. Options Mos, Ron de 5 17/11/2014 97 37.11 112,001 -27,220 CGI Group Inc. Options Mos, Ron de 5 18/11/2014 51 24.29 92,001 -20,000 CGI Group Inc. Subordinate Voting Mos, Ron de 5 01/03/2013 00 Shares Classe A CGI Group Inc. Subordinate Voting Mos, Ron de 5 18/11/2014 51 24.29 20,000 20,000 Shares Classe A CGI Group Inc. Subordinate Voting Mos, Ron de 5 18/11/2014 10 41.358 0 -20,000 Shares Classe A CGI Group Inc. Options Mossburg, Gregg Thomas 5 17/11/2014 97 37.11 54,553 -23,895 CGI Group Inc. Options Nikku, Heikki 5 17/11/2014 97 37.11 107,552 -26,825 CGI Group Inc. Options Peake, James Benjamin 5 17/11/2014 97 37.11 176,695 -17,587 CGI Group Inc. Options Perron, Steve 5 17/11/2014 97 37.11 14,333 -1,947 CGI Group Inc. Options Petersen, Martin 5 17/11/2014 97 37.11 45,170 -9,596 CGI Group Inc. Options Pinard, Luc 5 17/11/2014 97 37.11 134,383 -9,738 CGI Group Inc. Options Rancourt, Suzanne 5 17/11/2014 97 37.11 25,990 -1,558 CGI Group Inc. Rights Performance Share Roach, Michael 4, 5 17/11/2014 97 37.115 893,187 -103,019 Units CGI Group Inc. Options Rocheleau, Daniel 5 17/11/2014 97 37.11 177,331 -7,790 CGI Group Inc. Options Rocheleau, Daniel 5 18/11/2014 51 15.49 176,031 -1,300 CGI Group Inc. Options Rocheleau, Daniel 5 19/11/2014 51 15.49 126,031 -50,000 CGI Group Inc. Options Rocheleau, Daniel 5 21/11/2014 51 15.49 106,031 -20,000 CGI Group Inc. Subordinate Voting Rocheleau, Daniel 5 18/11/2014 51 15.49 1,300 1,300 Shares Classe A CGI Group Inc. Subordinate Voting Rocheleau, Daniel 5 18/11/2014 10 41.8 0 -1,300 Shares Classe A CGI Group Inc. Subordinate Voting Rocheleau, Daniel 5 19/11/2014 51 15.349 50,000 50,000 Shares Classe A CGI Group Inc. Subordinate Voting Rocheleau, Daniel 5 19/11/2014 10 41.57 30,000 -20,000 Shares Classe A CGI Group Inc. Subordinate Voting Rocheleau, Daniel 5 19/11/2014 10 41.66 10,000 -20,000 Shares Classe A CGI Group Inc. Subordinate Voting Rocheleau, Daniel 5 19/11/2014 10 41.669 0 -10,000 Shares Classe A CGI Group Inc. Subordinate Voting Rocheleau, Daniel 5 21/11/2014 51 15.49 20,000 20,000 Shares Classe A CGI Group Inc. Subordinate Voting Rocheleau, Daniel 5 21/11/2014 10 41.114 0 -20,000 Shares Classe A CGI Group Inc. Options Roy, Jacques 5 17/11/2014 97 37.11 41,995 -5,258 CGI Group Inc. Options Roy, Jacques 5 18/11/2014 51 15.49 39,620 -2,375 CGI Group Inc. Subordinate Voting Roy, Jacques 5 18/11/2014 51 15.49 2,375 2,375 Shares Classe A
November 27, 2014 (2014), 37 OSCB 10595
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed CGI Group Inc. Subordinate Voting Roy, Jacques 5 18/11/2014 10 41.7 0 -2,375 Shares Classe A CGI Group Inc. Subordinate Voting Roy, Jacques 5 20/11/2014 30 156 130 Shares Classe A CGI Group Inc. Subordinate Voting Roy, Jacques 5 20/11/2014 10 41.472 1 -155 Shares Classe A CGI Group Inc. Options Sandbakken, Olav 5 17/11/2014 97 37.11 26,394 -15,930 CGI Group Inc. Options Sandbakken, Olav 5 18/11/2014 51 24.29 23,952 -2,442 CGI Group Inc. Subordinate Voting Sandbakken, Olav 5 17/01/2014 00 Shares Classe A CGI Group Inc. Subordinate Voting Sandbakken, Olav 5 18/11/2014 50 24.29 2,442 2,442 Shares Classe A CGI Group Inc. Subordinate Voting Sandbakken, Olav 5 18/11/2014 10 41.358 0 -2,442 Shares Classe A CGI Group Inc. Options Schindler, George Donald 5 17/11/2014 97 36.15 804,578 -121,152 CGI Group Inc. Options Schreil Jonsson, Karin 5 17/11/2014 97 37.11 38,293 -23,895 CGI Group Inc. Options Séguin, Claude 5 17/11/2014 97 37.11 189,089 -5,842 CGI Group Inc. Options SMART, STEVEN 5 17/11/2014 97 37.11 70,381 -4,229 CHARLES CGI Group Inc. Options Springall, Jeremy 5 17/11/2014 97 37.11 27,732 -2,268 CGI Group Inc. Options Strass, Torsten 5 17/11/2014 97 37.1 81,610 -23,895 CGI Group Inc. Options Strass, Torsten 5 19/11/2014 51 24.29 71,610 -10,000 CGI Group Inc. Subordinate Voting Strass, Torsten 5 01/03/2013 00 Shares Classe A CGI Group Inc. Subordinate Voting Strass, Torsten 5 19/11/2014 51 24.29 10,000 10,000 Shares Classe A CGI Group Inc. Subordinate Voting Strass, Torsten 5 19/11/2014 10 41.989 2,005 -7,995 Shares Classe A CGI Group Inc. Options Szabo, Stefan 5 17/11/2014 97 37.11 52,331 -9,263 CGI Group Inc. Options THORN, STEPHEN MARK 5 17/11/2014 97 37.11 105,482 -3,895 CGI Group Inc. Options Townes-Whitley, Toni 5 17/11/2014 97 37.11 117,366 -16,211 CGI Group Inc. Options Vets, Hans 5 17/11/2014 97 37.11 40,027 -15,930 CGI Group Inc. Options Vets, Hans 5 19/11/2014 51 24.29 33,874 -6,153 CGI Group Inc. Subordinate Voting Vets, Hans 5 19/11/2014 51 24.29 6,153 6,153 Shares Classe A CGI Group Inc. Subordinate Voting Vets, Hans 5 19/11/2014 10 41.449 0 -6,153 Shares Classe A CGI Group Inc. Options Vigeant, Guy 5 17/11/2014 97 37.11 101,331 -17,865 CGI Group Inc. Options Westh, Joakim 4 17/11/2014 97 36.15 10,255 -1,558 CGI Group Inc. Options Whitchurch, Michael 5 17/11/2014 97 37.11 107,512 -5,194 CGI Group Inc. Options Whitchurch, Michael 5 19/11/2014 51 19.71 107,116 -396 CGI Group Inc. Options Whitchurch, Michael 5 19/11/2014 51 23.65 95,216 -11,900 CGI Group Inc. Subordinate Voting Whitchurch, Michael 5 19/11/2014 51 19.71 396 396 Shares Classe A CGI Group Inc. Subordinate Voting Whitchurch, Michael 5 19/11/2014 51 23.65 12,296 11,900 Shares Classe A CGI Group Inc. Subordinate Voting Whitchurch, Michael 5 19/11/2014 51 41.448 0 -12,296 Shares Classe A CHC Realty Capital Corp. Common Shares Forbes, Louis Marie 4 09/10/2014 00 CHC Realty Capital Corp. Common Shares Forbes, Louis Marie 4 19/11/2014 16 0.11 227,273 227,273 CHC Realty Capital Corp. Warrants Forbes, Louis Marie 4 09/10/2014 00 CHC Realty Capital Corp. Warrants Forbes, Louis Marie 4 19/11/2014 16 0.13 227,273 227,273 CHC Realty Capital Corp. Common Shares Hansen, Mark Asbjorn 5 19/11/2014 16 0.11 2,590,910 90,910 CHC Realty Capital Corp. Warrants Hansen, Mark Asbjorn 5 20/11/2013 00 CHC Realty Capital Corp. Warrants Hansen, Mark Asbjorn 5 19/11/2014 16 0.13 90,910 90,910 CHC Realty Capital Corp. Common Shares MacLellan, Vaughn 5 19/11/2014 16 0.11 1,227,273 227,273 CHC Realty Capital Corp. Warrants MacLellan, Vaughn 5 20/11/2013 00 CHC Realty Capital Corp. Warrants MacLellan, Vaughn 5 19/11/2014 16 0.13 227,273 227,273 CHC Realty Capital Corp. Common Shares Schwarz, Ronald 4 19/11/2014 16 0.11 3,000,000 500,000 CHC Realty Capital Corp. Warrants Schwarz, Ronald 4 09/10/2014 00 CHC Realty Capital Corp. Warrants Schwarz, Ronald 4 19/11/2014 16 0.11 500,000 500,000 CHC Realty Capital Corp. Common Shares Smith, Craig Gordon 4 19/11/2014 16 0.11 2,181,819 1,363,637
November 27, 2014 (2014), 37 OSCB 10596
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed CHC Realty Capital Corp. Warrants Smith, Craig Gordon 4 20/11/2013 00 CHC Realty Capital Corp. Warrants Smith, Craig Gordon 4 19/11/2014 16 0.13 1,363,637 1,363,637 CHC Realty Capital Corp. Common Shares Waxman, Robert 5 19/11/2014 16 0.11 135,000 45,000 CHC Realty Capital Corp. Common Shares Waxman, Robert 5 19/11/2014 16 0.11 180,000 45,000 CHC Realty Capital Corp. Warrants Waxman, Robert 5 20/11/2013 00 CHC Realty Capital Corp. Warrants Waxman, Robert 5 19/11/2014 16 0.13 45,000 45,000 CHC Realty Capital Corp. Warrants Waxman, Robert 5 20/11/2013 00 CHC Realty Capital Corp. Warrants Waxman, Robert 5 19/11/2014 16 0.13 45,000 45,000 Chieftain Metals Corp. Common Shares Sutin, Richard S. 4 19/11/2014 10 0.19 199,280 26,000 China Minerals Mining Common Shares Brooks, Harvey Leonard 4 17/11/2014 10 0.005 0 -45,000 Corporation Chinook Energy Inc. Common Shares Angevine, Jill Terilee 4 13/11/2014 00 11,825 Choice Properties Real Trust Units Wasti, Rashid 7 19/11/2014 10 10.87 0 -4,100 Estate Investment Trust CI Financial Corp. Common Shares Jamieson, Douglas J.R. 5 14/11/2014 10 34.09 75,000 -10,000 CIBT Education Group Inc. Common Shares Chu, Toby 4, 5 19/11/2014 10 0.26 5,109,847 5,000 CIBT Education Group Inc. Common Shares Chu, Toby 4, 5 21/11/2014 10 0.25 5,059,847 -50,000 Cineplex Inc. Common Shares McGrath, Daniel F. 5 17/11/2014 51 44.22 46,652 2,500 Cineplex Inc. Options McGrath, Daniel F. 5 17/11/2014 51 105,003 -2,500 Cipher Pharmaceuticals Inc. Common Shares Aigner, Stefan 4 17/11/2014 30 12.85 43,128 210 Cipher Pharmaceuticals Inc. Common Shares Chypyha, Joan 5 17/11/2014 30 12.85 93 93 Cipher Pharmaceuticals Inc. Common Shares Claypool, William 4 17/11/2014 30 12.85 132,886 210 Cipher Pharmaceuticals Inc. Common Shares Evans, Norman Charles 5 17/11/2014 30 12.85 34,321 93 Cipher Pharmaceuticals Inc. Common Shares McDole, Gerald P. 4 17/11/2014 30 12.85 49,758 187 Cipher Pharmaceuticals Inc. Common Shares O'Brien, Shawn Patrick 5 17/11/2014 30 12.85 5,713 175 Cipher Pharmaceuticals Inc. Common Shares Wellner, Thomas Gordon 4 17/11/2014 30 12.85 1,039 93 Cipher Pharmaceuticals Inc. Common Shares Wiseman, Stephen R. 4 17/11/2014 30 12.85 249 249 Clarke Inc. Common Shares Potter, Carl Blackadar 3 18/11/2014 10 10.73 1,786,400 -800 Clarke Inc. Common Shares Potter, Carl Blackadar 3 18/11/2014 10 10.72 1,786,300 -100 Clarke Inc. Common Shares Potter, Carl Blackadar 3 18/11/2014 10 10.7 1,763,800 -22,500 Clarke Inc. Common Shares Potter, Carl Blackadar 3 18/11/2014 10 10.68 1,762,700 -1,100 Clarke Inc. Common Shares Potter, Carl Blackadar 3 18/11/2014 10 10.62 1,762,500 -200 Clarke Inc. Common Shares Potter, Carl Blackadar 3 18/11/2014 10 10.61 1,761,200 -1,300 Clarke Inc. Common Shares Potter, Carl Blackadar 3 18/11/2014 10 10.6 1,756,400 -4,800 Clarke Inc. Common Shares Potter, Carl Blackadar 3 18/11/2014 10 10.59 1,755,500 -900 Clarke Inc. Common Shares Potter, Carl Blackadar 3 18/11/2014 10 10.53 1,753,800 -1,700 Clarke Inc. Common Shares Potter, Carl Blackadar 3 18/11/2014 10 10.52 1,753,200 -600 Clarke Inc. Common Shares Potter, Carl Blackadar 3 18/11/2014 10 10.5 1,587,200 -166,000 Claude Resources Inc. Common Shares Hicks, Ronald J. 4 14/11/2014 10 25.5 -70,000 Claude Resources Inc. Common Shares Hicks, Ronald J. 4 14/11/2014 10 0.255 149,927 -70,000 Claude Resources Inc. Common Shares Hicks, Ronald J. 4 14/11/2014 10 0.26 79,927 -70,000 CNRP Mining Inc. Common Shares Wettreich, Daniel 4, 5 21/11/2014 10 0.02 117,000 50,000 CO2 Solutions Inc. Options Carley, Jonathan 5 02/11/2014 52 0.16 544,900 -100,000 CO2 Solutions Inc. Options FRADETTE, SYLVIE 5 02/11/2014 52 0.16 404,300 -75,000 CO2 Solutions Inc. Options Manherz, Robert 3, 4 02/11/2014 52 0.16 80,000 -13,333 CO2 Solutions Inc. Options Okell, Kimberley 4 02/11/2014 52 0.16 80,000 -20,000 CO2 Solutions Inc. Options Pelletier, Martin P. 4 02/11/2014 52 0.16 80,000 -20,000 CO2 Solutions Inc. Options Price, Evan 4, 5 02/11/2014 52 0.16 640,000 -11,667 CO2 Solutions Inc. Options Proteau, Jocelyn 4 02/11/2014 52 0.16 80,000 -20,000 CO2 Solutions Inc. Options Voyer, Normand 5 02/11/2014 52 0.16 150,000 -20,000 Cogeco Cable Inc. Options ALVES, ELIZABETH 5 20/11/2014 51 50.1 5,174 -420 Cogeco Cable Inc. Subordinate Voting ALVES, ELIZABETH 5 20/11/2014 51 50.1 744 420 Shares actions subalternes à droit de vote Cogeco Cable Inc. Subordinate Voting Jetté, Philippe 5 30/09/2014 30 59.69 225 225 Shares actions subalternes à droit de vote Cogeco Cable Inc. Subordinate Voting Jetté, Philippe 5 05/11/2014 57 48.02 1,301 Shares actions subalternes à droit de vote
November 27, 2014 (2014), 37 OSCB 10597
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Cogeco Cable Inc. Subordinate Voting Jetté, Philippe 5 05/11/2014 57 48.02 1,525 1,300 Shares actions subalternes à droit de vote Cogeco Cable Inc. Subordinate Voting Jetté, Philippe 5 14/11/2014 10 63.9 0 -1,300 Shares actions subalternes à droit de vote Cogeco Cable Inc. Subordinate Voting Maheux, Pierre 5 17/11/2014 10 64.86 822 -401 Shares actions subalternes à droit de vote Cogeco Cable Inc. Options Ouimet, Patrice 5 17/11/2014 00 Cogeco Cable Inc. Options Ouimet, Patrice 5 17/11/2014 50 63.66 10,100 10,100 Cogeco Cable Inc. Performance Share Units / Ouimet, Patrice 5 17/11/2014 00 Unite d'action performance Cogeco Cable Inc. Performance Share Units / Ouimet, Patrice 5 17/11/2014 56 63.66 1,800 1,800 Unite d'action performance Cogeco Inc Incentive Units/Unités Ouimet, Patrice 5 17/11/2014 00 incitatives Cogeco Inc Incentive Units/Unités Ouimet, Patrice 5 17/11/2014 56 56.78 1,900 1,900 incitatives Cogeco Inc Performance Share Units / Ouimet, Patrice 5 17/11/2014 00 Unite d'action performance Cogeco Inc Performance Share Units / Ouimet, Patrice 5 17/11/2014 56 56.78 1,900 1,900 Unite d'action performance Cogitore Resources Inc. Common Shares Dundee Corporation 3 19/11/2014 90 0 -4,350,000 Colombian Mines Options Burchill, Donn 4 21/11/2014 52 300,000 -50,000 Corporation Colt Resources Inc. Common Shares Perrault, Nikolas 4, 5 11/11/2014 10 0.102 2,976,636 25,000 COM DEV International Ltd. Common Shares Kamboj, Avjit 5 17/11/2014 00 COMPASS Income Fund Trust Units COMPASS Income Fund 1 14/11/2014 10 13.4 30,829,884 -100 COMPASS Income Fund Trust Units COMPASS Income Fund 1 17/11/2014 10 13.371 30,828,084 -1,800 COMPASS Income Fund Trust Units COMPASS Income Fund 1 19/11/2014 10 13.507 30,826,584 -1,500 COMPASS Income Fund Trust Units COMPASS Income Fund 1 19/11/2014 38 13.45 30,826,784 200 Condor Petroleum Inc. Common Shares Storm, Norman 6 17/11/2014 10 0.22 2,767,118 20,000 Condor Petroleum Inc. Common Shares Storm, Norman 6 17/11/2014 10 0.225 2,792,118 25,000 Condor Petroleum Inc. Common Shares Storm, Norman 6 18/11/2014 10 0.22 2,822,118 30,000 Condor Petroleum Inc. Common Shares Storm, Norman 6 20/11/2014 10 0.215 2,827,118 5,000 Condor Petroleum Inc. Common Shares Storm, Norman 6 20/11/2014 10 0.22 2,842,118 15,000 CONDOR RESOURCES Options Boyd, Robert T. 4 15/11/2014 52 0.15 -12,000 INC. CONDOR RESOURCES Options Boyd, Robert T. 4 15/11/2014 52 0.15 360,000 -120,000 INC. CONDOR RESOURCES Options Burns, Patrick James 4 17/11/2014 52 0.15 625,000 -200,000 INC. CONDOR RESOURCES Options Davis, Lyle Roy 4 15/11/2014 52 0.15 730,000 -120,000 INC. CONDOR RESOURCES Options Larkin, Paul Anthony 5 17/11/2014 52 0.15 360,000 -120,000 INC. CONDOR RESOURCES Options Scott, Graham Howard 4, 5 15/11/2014 52 0.15 360,000 -120,000 INC. Constellation Software Inc. Debentures - Baksh, Jamal Nizam 5 19/11/2014 57 26695 $62,600 $28,100 Subordinated Floating Rate, Series 1 due March 31, 2040 Constellation Software Inc. Rights Baksh, Jamal Nizam 5 19/11/2014 57 0 -5,955 Contrans Group Inc. Subordinate Voting Amos, Gordon Ross 4 14/11/2014 22 14.6 0 -8,847 Shares Class A Contrans Group Inc. Subordinate Voting Amos, Gordon Ross 4 14/11/2014 51 9.85 40,000 40,000 Shares Class A Contrans Group Inc. Subordinate Voting Amos, Gordon Ross 4 14/11/2014 22 14.6 0 -40,000 Shares Class A Contrans Group Inc. Multiple Voting Shares Burgess, Robert Burnside 4 14/11/2014 22 14.6 0 -5,000 Class B
November 27, 2014 (2014), 37 OSCB 10598
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Contrans Group Inc. Options Burgess, Robert Burnside 4 01/12/2009 00 40,000 Contrans Group Inc. Subordinate Voting Burgess, Robert Burnside 4 14/11/2014 51 8.95 73,540 40,000 Shares Class A Contrans Group Inc. Subordinate Voting Burgess, Robert Burnside 4 14/11/2014 22 14.6 23,540 -50,000 Shares Class A Contrans Group Inc. Subordinate Voting Burgess, Robert Burnside 4 20/11/2014 99 0 -23,540 Shares Class A Contrans Group Inc. Multiple Voting Shares DUNFORD, STANLEY 4, 5 01/09/2014 90 1,377,724 757,348 Class B GEORGE Contrans Group Inc. Multiple Voting Shares DUNFORD, STANLEY 4, 5 14/11/2014 22 14.6 -620,376 Class B GEORGE Contrans Group Inc. Multiple Voting Shares DUNFORD, STANLEY 4, 5 14/11/2014 22 14.6 -620,376 Class B GEORGE Contrans Group Inc. Multiple Voting Shares DUNFORD, STANLEY 4, 5 14/11/2014 36 0 -1,377,724 Class B GEORGE Contrans Group Inc. Multiple Voting Shares DUNFORD, STANLEY 4, 5 01/09/2014 90 0 -757,348 Class B GEORGE Contrans Group Inc. Multiple Voting Shares DUNFORD, STANLEY 4, 5 14/11/2014 22 14.6 -757,348 Class B GEORGE Contrans Group Inc. Subordinate Voting DUNFORD, STANLEY 4, 5 14/11/2014 22 14.6 0 -3,300 Shares Class A GEORGE Contrans Group Inc. Subordinate Voting DUNFORD, STANLEY 4, 5 01/09/2014 90 0 -517,364 Shares Class A GEORGE Contrans Group Inc. Subordinate Voting DUNFORD, STANLEY 4, 5 01/09/2014 90 3,827,203 517,364 Shares Class A GEORGE Contrans Group Inc. Subordinate Voting DUNFORD, STANLEY 4, 5 14/11/2014 36 5,204,927 1,377,724 Shares Class A GEORGE Contrans Group Inc. Subordinate Voting DUNFORD, STANLEY 4, 5 14/11/2014 22 14.6 0 -5,204,927 Shares Class A GEORGE Contrans Group Inc. Options Jenereaux, William Todd 5 11/11/2014 51 8.95 0 -100,000 Contrans Group Inc. Subordinate Voting Jenereaux, William Todd 5 11/11/2014 51 8.95 116,900 100,000 Shares Class A Contrans Group Inc. Subordinate Voting Jenereaux, William Todd 5 14/11/2014 22 14.6 0 -116,900 Shares Class A Contrans Group Inc. Subordinate Voting McDonough, Norman 5 14/11/2014 22 14.6 0 -15,000 Shares Class A Contrans Group Inc. Subordinate Voting Rumble, Gregory William 4, 5 14/11/2014 22 14.6 0 -446,671 Shares Class A Contrans Group Inc. Multiple Voting Shares TransForce Inc. 3 11/11/2014 00 5,000 Class B Contrans Group Inc. Multiple Voting Shares TransForce Inc. 3 11/11/2014 00 Class B Contrans Group Inc. Multiple Voting Shares TransForce Inc. 3 14/11/2014 22 14.6 1,377,724 1,377,724 Class B Contrans Group Inc. Subordinate Voting TransForce Inc. 3 11/11/2014 00 24,287,579 Shares Class A Contrans Group Inc. Subordinate Voting TransForce Inc. 3 11/11/2014 00 Shares Class A Contrans Group Inc. Subordinate Voting TransForce Inc. 3 14/11/2014 22 14.6 3,827,203 3,827,203 Shares Class A Copper Mountain Mining Common Shares Holbek, Peter Michael 5 20/11/2014 10 2.16 270,000 -5,000 Corporation Copperbank Resources Common Shares Kovacevic, John Gianni 4, 5 17/11/2014 10 0.07 1,960,000 25,000 Corp. Copperbank Resources Common Shares Kovacevic, John Gianni 4, 5 17/11/2014 10 0.075 1,982,000 22,000 Corp. Copperbank Resources Common Shares Kovacevic, John Gianni 4, 5 18/11/2014 10 0.08 1,992,000 10,000 Corp. Copperbank Resources Common Shares Kovacevic, John Gianni 4, 5 20/11/2014 10 0.075 2,009,000 17,000 Corp. Copperbank Resources Common Shares Kovacevic, John Gianni 4, 5 20/11/2014 10 0.075 2,014,000 5,000 Corp. Coro Mining Corp. Common Shares Philpot, Michael 4, 5 14/11/2014 10 0.04 6,373,666 500,000 Coro Mining Corp. Common Shares Philpot, Michael 4, 5 18/11/2014 10 0.05 6,873,666 500,000 Coro Mining Corp. Common Shares Towns, Damian Jon 5 14/11/2014 10 0.035 1,124,800 150,000 Corridor Resources Inc. Options Moran, Stephen John 5 29/09/2013 00
November 27, 2014 (2014), 37 OSCB 10599
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Corridor Resources Inc. Options Moran, Stephen John 5 17/11/2014 50 1.24 900,000 900,000 Crescent Point Energy Corp. Common Shares ROMANZIN, GERALD A. 4 13/11/2014 10 35.45 0 -501 Critical Outcome Common Shares Sanderson, David Stewart 4 05/12/2013 00 Technologies Inc. Critical Outcome Common Shares Sanderson, David Stewart 4 05/12/2013 00 Technologies Inc. Critical Outcome Common Shares Sanderson, David Stewart 4 05/12/2013 00 416,666 Technologies Inc. Critical Outcome Common Shares Sanderson, David Stewart 4 14/11/2014 10 0.23 398,666 -18,000 Technologies Inc. Critical Outcome Common Shares Sanderson, David Stewart 4 14/11/2014 10 0.235 386,666 -12,000 Technologies Inc. Critical Outcome Common Shares Sanderson, David Stewart 4 14/11/2014 10 0.25 340,666 -46,000 Technologies Inc. Critical Outcome Common Shares Sanderson, David Stewart 4 14/11/2014 10 0.255 334,666 -6,000 Technologies Inc. CriticalControl Solutions Common Shares Hammett, William T. 4 18/11/2014 90 1,535,299 24,199 Corp. CriticalControl Solutions Common Shares Hammett, William T. 4 18/11/2014 90 0 -24,199 Corp. CWC Energy Services Corp. Common Shares Dawson, Frederick Curtis 5 18/11/2014 10 0.74 658,519 -6,000 CWC Energy Services Corp. Common Shares Dawson, Frederick Curtis 5 20/11/2014 10 0.74 649,519 -9,000 Danbel Ventures Inc. Options Bresge, Leslie 3, 4, 5 21/12/1998 00 Danbel Ventures Inc. Options Bresge, Leslie 3, 4, 5 14/11/2014 50 90,000 90,000 Danbel Ventures Inc. Options Nachman, Gabriel 4 15/09/2010 00 Danbel Ventures Inc. Options Nachman, Gabriel 4 14/11/2014 50 90,000 90,000 Danbel Ventures Inc. Options Polisuk, Barry 4 15/09/2010 00 Danbel Ventures Inc. Options Polisuk, Barry 4 14/11/2014 50 90,000 90,000 Danbel Ventures Inc. Options Singer, Michael Sheldon 4 15/09/2010 00 Danbel Ventures Inc. Options Singer, Michael Sheldon 4 14/11/2014 50 90,000 90,000 Danbel Ventures Inc. Options Stein, Michael Brian 3, 4, 5 08/10/2014 00 Danbel Ventures Inc. Options Stein, Michael Brian 3, 4, 5 14/11/2014 50 90,000 90,000 DATA Group Ltd. Convertible Debentures KST Industries Inc 3 19/12/2013 00 6.00% Convertible Unsecured Subordinated Debenture DATA Group Ltd. Convertible Debentures KST Industries Inc 3 18/11/2014 10 59 $20,000 $20,000 6.00% Convertible Unsecured Subordinated Debenture DELPHI ENERGY CORP. Common Shares CAMPBELL, HARRY 4 14/11/2014 10 1.966 839,075 50,000 SINCLAIR DEQ Systems Corp. Options Audet, Martin 5 17/11/2014 00 75,000 Diamond Fields International Common Shares Boulle, Jean-Raymond 3 17/11/2014 36 92,617,265 6,666,667 Ltd. Diamond Fields International Common Shares Boulle, Jean-Raymond 3 17/11/2014 54 0.0315 99,283,932 6,666,667 Ltd. Diamond Fields International Convertible Debentures Boulle, Jean-Raymond 3 17/11/2014 36 $151,357 -$150,000 Ltd. Diamond Fields International Warrants Boulle, Jean-Raymond 3 17/11/2014 36 14,666,667 6,666,667 Ltd. Diamond Fields International Warrants Boulle, Jean-Raymond 3 17/11/2014 54 8,000,000 -6,666,667 Ltd. DIRTT Environmental Common Shares Baker, Tracy May 5 20/11/2014 51 3 8,333 Solutions Ltd. DIRTT Environmental Common Shares Baker, Tracy May 5 20/11/2014 10 3.35 -8,333 Solutions Ltd. DIRTT Environmental Common Shares Baker, Tracy May 5 21/11/2014 51 3 323,355 8,333 Solutions Ltd. DIRTT Environmental Common Shares Baker, Tracy May 5 21/11/2014 10 3.35 315,022 -8,333 Solutions Ltd. DIRTT Environmental Options Baker, Tracy May 5 20/11/2014 51 3 -8,333 Solutions Ltd. DIRTT Environmental Options Baker, Tracy May 5 21/11/2014 51 3 183,000 -8,333 Solutions Ltd.
November 27, 2014 (2014), 37 OSCB 10600
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed DIRTT Environmental Common Shares Fairholm, Lawrence David 4 21/11/2014 51 3.2 70,000 50,000 Solutions Ltd. DIRTT Environmental Common Shares Fairholm, Lawrence David 4 21/11/2014 10 3.41 20,000 -50,000 Solutions Ltd. DIRTT Environmental Options Fairholm, Lawrence David 4 21/11/2014 51 3.2 100,000 -50,000 Solutions Ltd. DIRTT Environmental Common Shares Gosling, Geoffrey William 5 19/11/2014 51 3.2 957,227 50,000 Solutions Ltd. DIRTT Environmental Common Shares Gosling, Geoffrey William 5 19/11/2014 10 3.46 907,227 -50,000 Solutions Ltd. DIRTT Environmental Common Shares Gosling, Geoffrey William 5 20/11/2014 51 3 957,227 50,000 Solutions Ltd. DIRTT Environmental Common Shares Gosling, Geoffrey William 5 20/11/2014 10 3.39 907,227 -50,000 Solutions Ltd. DIRTT Environmental Options Gosling, Geoffrey William 5 19/11/2014 51 3.2 233,000 -50,000 Solutions Ltd. DIRTT Environmental Options Gosling, Geoffrey William 5 20/11/2014 51 3 183,000 -50,000 Solutions Ltd. DIRTT Environmental Common Shares Jenkins, Scott Ronald 4, 5 21/11/2014 51 2.15 177,020 108,333 Solutions Ltd. DIRTT Environmental Options Jenkins, Scott Ronald 4, 5 21/11/2014 51 2.15 258,000 -108,333 Solutions Ltd. DIRTT Environmental Common Shares Smed, Mogens Falk 4, 5 17/11/2014 51 3.2 734,239 10,000 Solutions Ltd. DIRTT Environmental Common Shares Smed, Mogens Falk 4, 5 17/11/2014 10 3.58 724,239 -10,000 Solutions Ltd. DIRTT Environmental Common Shares Smed, Mogens Falk 4, 5 18/11/2014 51 3 784,239 60,000 Solutions Ltd. DIRTT Environmental Common Shares Smed, Mogens Falk 4, 5 18/11/2014 10 3.47 724,239 -60,000 Solutions Ltd. DIRTT Environmental Common Shares Smed, Mogens Falk 4, 5 19/11/2014 51 3.2 734,239 10,000 Solutions Ltd. DIRTT Environmental Common Shares Smed, Mogens Falk 4, 5 19/11/2014 10 3.5 724,239 -10,000 Solutions Ltd. DIRTT Environmental Options Smed, Mogens Falk 4, 5 17/11/2014 51 3.2 353,000 -10,000 Solutions Ltd. DIRTT Environmental Options Smed, Mogens Falk 4, 5 18/11/2014 51 3 293,000 -60,000 Solutions Ltd. DIRTT Environmental Options Smed, Mogens Falk 4, 5 19/11/2014 51 3.2 283,000 -10,000 Solutions Ltd. Divestco Inc. Common Shares Class A Webster, Bruce 3 18/11/2014 10 0.08 2,491,800 5,000 Divestco Inc. Common Shares Class A Webster, Bruce 3 19/11/2014 10 0.08 2,495,800 4,000 Divestco Inc. Common Shares Class A Webster, Bruce 3 14/11/2014 10 0.09 194,000 44,000 Divestco Inc. Common Shares Class A Webster, Bruce 3 14/11/2014 10 0.09 76,400 66,000 DNI Metals Inc. Common Shares clement, denis arthur 4 17/11/2014 37 0 -1,890,187 DNI Metals Inc. Common Shares clement, denis arthur 4 17/11/2014 37 189,087 189,087 DNI Metals Inc. Common Shares clement, denis arthur 4 17/11/2014 37 0 -67,087 DNI Metals Inc. Common Shares clement, denis arthur 4 17/11/2014 37 6,708 6,708 DNI Metals Inc. Options clement, denis arthur 4 17/11/2014 37 0 -1,740,000 DNI Metals Inc. Options clement, denis arthur 4 17/11/2014 37 174,000 174,000 DNI Metals Inc. Common Shares Grant, Colin 5 14/11/2014 37 0 -228,048 DNI Metals Inc. Common Shares Grant, Colin 5 14/11/2014 37 22,805 22,805 DNI Metals Inc. Options Grant, Colin 5 18/11/2014 37 0 -362,500 DNI Metals Inc. Options Grant, Colin 5 18/11/2014 37 36,250 36,250 Dollarama Inc. Options Assaly, John 7 17/11/2014 37 126,000 63,000 Dollarama Inc. Common Shares Bekenstein, Joshua 4 17/11/2014 37 5,000 2,500 Dollarama Inc. Options Bekenstein, Joshua 4 17/11/2014 37 12,000 6,000 Dollarama Inc. Common Shares Choinière, Johanne 5 17/11/2014 37 12,950 6,475 Dollarama Inc. Options Choinière, Johanne 5 17/11/2014 37 254,000 127,000 Dollarama Inc. Options David, Gregory 4 17/11/2014 37 24,000 12,000 Dollarama Inc. Common Shares Gunn, Stephen 4 17/11/2014 37 28,600 14,300 Dollarama Inc. Options Gunn, Stephen 4 17/11/2014 37 24,000 12,000 Dollarama Inc. Options Nomicos, Nicholas George 4 17/11/2014 37 12,000 6,000
November 27, 2014 (2014), 37 OSCB 10601
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Dollarama Inc. Common Shares Robillard, Geoffrey Peter 5 17/11/2014 37 876,000 438,000 Dollarama Inc. Options Roche, Paul 5 17/11/2014 37 46,000 23,000 Dollarama Inc. Options Ross, Michael 5 17/11/2014 37 284,000 142,000 Dollarama Inc. Common Shares Rossy, Lawrence 4, 5 17/11/2014 37 2,934,610 1,467,305 Dollarama Inc. Common Shares Rossy, Lawrence 4, 5 17/11/2014 37 5,879,850 2,939,925 Dollarama Inc. Options Rossy, Lawrence 4, 5 17/11/2014 37 500,000 250,000 Dollarama Inc. Common Shares Rossy, Neil George 4, 5 17/11/2014 37 1,256,688 628,344 Dollarama Inc. Common Shares Rossy, Neil George 4, 5 17/11/2014 37 2,000 1,000 Dollarama Inc. Common Shares Rossy, Neil George 4, 5 17/11/2014 37 2,000 1,000 Dollarama Inc. Common Shares Rossy, Neil George 4, 5 17/11/2014 37 2,000 1,000 Dollarama Inc. Common Shares Rossy, Neil George 4, 5 17/11/2014 37 2,000 1,000 Dollarama Inc. Options Rossy, Neil George 4, 5 17/11/2014 37 220,000 110,000 Dollarama Inc. Common Shares Roy, Richard G 4 17/11/2014 37 4,000 2,000 Dollarama Inc. Options Roy, Richard G 4 17/11/2014 37 12,000 6,000 Dollarama Inc. Common Shares Swidler, John Joseph 4 17/11/2014 37 8,000 4,000 Dollarama Inc. Common Shares Swidler, John Joseph 4 17/11/2014 37 3,400 1,700 Dollarama Inc. Common Shares Swidler, John Joseph 4 17/11/2014 37 100,000 50,000 Dollarama Inc. Options Swidler, John Joseph 4 17/11/2014 37 24,000 12,000 Dollarama Inc. Common Shares Thomas, John Huw 4 17/11/2014 37 12,400 6,200 Dollarama Inc. Options Thomas, John Huw 4 17/11/2014 37 14,000 7,000 DragonWave Inc. Common Shares Haw, Claude, Carmen 4 19/11/2014 10 1.0165 10,000 10,000 dynaCERT Inc. (formerly Common Shares Fernandez, Yumey 5 08/08/2013 00 Dynamic Fuel Systems Inc.) dynaCERT Inc. (formerly Common Shares Fernandez, Yumey 5 08/08/2013 00 5,000 Dynamic Fuel Systems Inc.) dynaCERT Inc. (formerly Options Fernandez, Yumey 5 16/10/2014 51 0.1 25,000 Dynamic Fuel Systems Inc.) dynaCERT Inc. (formerly Options Fernandez, Yumey 5 16/10/2014 51 0.1 252,001 1 Dynamic Fuel Systems Inc.) Dynamic Oil & Gas Common Shares Moen, George Marius 4 19/11/2014 10 0.02 512,000 45,000 Exploration Inc. (formerly Dominion Energy Inc.) Dynamic Oil & Gas Common Shares Roehlig, Axel Gunther 4, 5 19/11/2014 10 0.02 2,760,521 55,000 Exploration Inc. (formerly Ruediger Dominion Energy Inc.) Dynamic Oil & Gas Common Shares Roehlig, Axel Gunther 4, 5 20/11/2014 10 0.025 2,805,521 45,000 Exploration Inc. (formerly Ruediger Dominion Energy Inc.) Dynasty Metals & Mining Inc. Options Furber, Nicholas John 5 24/03/2014 52 5 385,000 -75,000 Dynasty Metals & Mining Inc. Options Furber, Nicholas John 5 27/07/2014 52 3.53 360,000 -25,000 Dynasty Metals & Mining Inc. Options Furber, Nicholas John 5 21/11/2014 50 0.92 475,000 115,000 Dynasty Metals & Mining Inc. Options Washer, Robert 3, 4, 5 24/03/2014 52 5 1,850,000 -500,000 Dynasty Metals & Mining Inc. Options Washer, Robert 3, 4, 5 11/06/2014 52 5.45 1,350,000 -500,000 Dynasty Metals & Mining Inc. Options Washer, Robert 3, 4, 5 24/09/2003 00 Dynasty Metals & Mining Inc. Options Washer, Robert 3, 4, 5 21/11/2014 50 0.92 1,000,000 1,000,000 Eagleford Energy Corp. Options Cassina, James C. 3, 4, 5 12/11/2014 50 350,000 250,000 Eagleford Energy Corp. Options Klyman, Milton 4 12/11/2014 50 350,000 250,000 Eagleford Energy Corp. Options McNeil, Colin Stuart 4 12/11/2014 50 350,000 250,000 East Coast Investment Units McGovern, James 7 17/11/2014 10 10.33 1,500 1,500 Grade Income Fund EastSiberian Plc Common Shares Phipps, Graeme 4 22/10/2012 37 72,836 -7,210,498 EastSiberian Plc Common Shares Phipps, Graeme 4 08/10/2014 46 0.05 2,272,836 2,200,000 EastSiberian Plc Common Shares Phipps, Graeme 4 18/11/2014 97 2,270,061 -2,775 EGI Financial Holdings Inc. Common Shares Kalopsis, George 7 18/11/2014 10 8,291 667 EGI Financial Holdings Inc. Options Kalopsis, George 7 17/11/2014 51 33,750 -6,750 Eldorado Gold Corporation Common Shares Eldorado Gold Corporation 1 17/11/2014 38 7.15 1,106,084 -18,194 Eldorado Gold Corporation Common Shares Moura, Eduardo Eugenio 5 17/11/2014 36 7.15 18,194 18,194 Chaves Eldorado Gold Corporation Restricted Share Units Moura, Eduardo Eugenio 5 17/11/2014 38 82,531 -6,834 Chaves Eldorado Gold Corporation Restricted Share Units Moura, Eduardo Eugenio 5 17/11/2014 38 71,171 -11,360 Chaves
November 27, 2014 (2014), 37 OSCB 10602
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Element Financial Deferred Share Units Arthur, Philip Duke 4 17/11/2014 50 13.522 11,998 2,524 Corporation Element Financial Common Shares Béland, Michel 5 18/11/2014 10 14.413 515,090 34,812 Corporation Element Financial Common Shares Bergeron, Tony 5 18/11/2014 10 14.413 46,252 10,442 Corporation Element Financial Deferred Share Units Bridge, Harold Dixon 4 17/11/2014 50 13.522 13,024 1,716 Corporation Element Financial Common Shares Campbell, Donald Paul 7 18/11/2014 10 14.413 114,867 10,442 Corporation Element Financial Common Shares Corman, Scott 5 18/11/2014 10 14.413 69,405 17,405 Corporation Element Financial Common Shares Ells, Bruce 5 18/11/2014 10 14.413 78,379 10,442 Corporation Element Financial Deferred Share Units Giffin, Gordon 4 17/11/2014 50 13.522 9,412 1,947 Corporation Element Financial Common Shares Grosso, Steve A 7 18/11/2014 10 14.413 45,342 10,442 Corporation Element Financial Common Shares Halliday, James 5 18/11/2014 10 14.413 64,241 10,442 Corporation Element Financial Common Shares Hudson, Steven Kenneth 4, 5 17/11/2014 10 14.206 2,467,988 52,800 Corporation Element Financial Common Shares Hudson, Todd Charles 5 18/11/2014 10 14.413 319,300 17,529 Corporation Element Financial Common Shares Jauernig, Dan 5 17/11/2014 00 10,000 Corporation Element Financial Common Shares Jauernig, Dan 5 17/11/2014 00 Corporation Element Financial Common Shares Jauernig, Dan 5 17/11/2014 10 14.363 52,000 52,000 Corporation Element Financial Preferred Shares Jauernig, Dan 5 17/11/2014 00 4,600 Corporation Element Financial Deferred Share Units Lamm-Tennant, Joan 5 18/06/2014 00 Corporation Element Financial Deferred Share Units Lamm-Tennant, Joan 5 17/11/2014 50 13.522 1,836 1,836 Corporation Element Financial Deferred Share Units Lortie, Pierre 4 17/11/2014 50 13.522 13,663 2,399 Corporation Element Financial Deferred Share Units LOWDEN, STEPHENS 4 17/11/2014 50 13.522 9,735 1,330 Corporation BAIN Element Financial Common Shares Martin, Karen Lynne 5 18/11/2014 10 14.413 87,655 17,405 Corporation Element Financial Common Shares McKerroll, David D. 5 17/11/2014 10 14.206 212,314 52,700 Corporation Element Financial Common Shares Nikopoulos, Jim 5 18/11/2014 10 14.413 89,962 34,812 Corporation Element Financial Common Shares Nullmeyer, Bradley 5 17/11/2014 10 14.206 1,241,712 52,800 Corporation Element Financial Common Shares Paradis, Rene Jennine 7 18/11/2014 10 14.413 17,961 6,961 Corporation Element Financial Common Shares Sadler, John 5 18/11/2014 10 14.413 116,127 17,405 Corporation Element Financial Common Shares Sands, John Stephen 5 18/11/2014 10 14.413 381,411 10,442 Corporation Element Financial Common Shares Small, Steven Charles 4 18/11/2014 10 14.413 1,186,466 55,701 Corporation Element Financial Common Shares Smith, Bruce Frank 4, 5 18/11/2014 10 14.413 566,066 17,405 Corporation Element Financial Common Shares Stoyan, Paul James 4 17/11/2014 10 14 261,191 5,000 Corporation Enbridge Inc. Common Shares Hansen, Cynthia Lynn 5 30/06/2014 30 48.38 27,977 367 Enbridge Inc. Common Shares Hansen, Cynthia Lynn 5 20/11/2014 51 15.84 32,777 4,800 Enbridge Inc. Common Shares Hansen, Cynthia Lynn 5 30/06/2014 30 48.38 4,442 63 Enbridge Inc. Options $15.84 ($31.68) Hansen, Cynthia Lynn 5 20/11/2014 51 0 -4,800 ($63.36) - February 3, 2015 Expiry Endeavour Silver Corp. Common Shares Walton, Godfrey John 4 14/11/2014 10 2.96 75,847 1,340
November 27, 2014 (2014), 37 OSCB 10603
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Endeavour Silver Corp. Options Walton, Godfrey John 4 13/11/2014 52 3.29 1,095,000 -25,000 EnerCare Inc. (formerly The Common Shares Macdonald, John 5 01/01/2011 00 Consumers' Waterheater Income Fund) EnerCare Inc. (formerly The Common Shares Macdonald, John 5 19/11/2014 10 15.45 100 100 Consumers' Waterheater Income Fund) EnerCare Inc. (formerly The Common Shares Macdonald, John 5 18/11/2014 10 15.35 15,000 1,000 Consumers' Waterheater Income Fund) EnerCare Inc. (formerly The Common Shares Macdonald, John 5 19/11/2014 10 15.47 15,100 100 Consumers' Waterheater Income Fund) Enerdynamic Hybrid Common Shares Inwentash, Sheldon 6 17/11/2014 10 0.8 773,000 -27,000 Technologies Corp. Enerdynamic Hybrid Common Shares Inwentash, Sheldon 6 19/11/2014 10 0.7999 566,500 -206,500 Technologies Corp. Enerplus Corporation Common Shares Politeski, Michael 7 15/08/2012 00 Enerplus Corporation Common Shares Politeski, Michael 7 20/11/2014 51 17.11 2,569 2,569 Enerplus Corporation Common Shares Politeski, Michael 7 20/11/2014 10 17.9 0 -2,569 Enerplus Corporation Options (Stock Option Politeski, Michael 7 20/11/2014 51 17.11 79,877 -2,569 Plan) ENTREC Corporation Common Shares ENTREC Corporation 1 20/11/2014 38 0.92 50,000 50,000 ENTREC Corporation Common Shares McLeod, Gavin Russell 5 18/11/2014 10 0.95 4,300 1,100 Entree Gold Inc. Common Shares Forster, Mona Marie 5 18/11/2014 10 216,374 25,000 Equitable Group Inc. Common Shares Downie, David 5 19/11/2014 51 29.32 21,490 1,190 Equitable Group Inc. Common Shares Downie, David 5 19/11/2014 51 36.11 22,393 903 Equitable Group Inc. Options Options granted Downie, David 5 19/11/2014 51 29.32 10,453 -1,190 Equitable Group Inc. Options Options granted Downie, David 5 19/11/2014 51 36.11 9,550 -903 Equitable Group Inc. Common Shares Edmunds, William Reid 7 17/11/2014 10 67.9 7,320 -1,500 Equitable Group Inc. Common Shares Edmunds, William Reid 7 18/11/2014 10 67.9 6,620 -700 Equitable Group Inc. Common Shares Edmunds, William Reid 7 18/11/2014 10 67.91 6,320 -300 Equitable Group Inc. Common Shares Kirzner, Eric Franklin 4 21/11/2014 10 67.35 3,440 -300 Equitable Group Inc. Common Shares Yu, David 5 19/11/2014 10 24.75 1,500 Equitable Group Inc. Common Shares Yu, David 5 19/11/2014 51 24.75 1,500 Equitable Group Inc. Common Shares Yu, David 5 19/11/2014 51 24.75 1,500 Equitable Group Inc. Common Shares Yu, David 5 19/11/2014 10 67.22 -1,500 Equitable Group Inc. Common Shares Yu, David 5 19/11/2014 10 67.22 -1,500 Equitable Group Inc. Common Shares Yu, David 5 19/11/2014 51 24.75 1,687 1,500 Equitable Group Inc. Common Shares Yu, David 5 19/11/2014 10 67.22 187 -1,500 Equitable Group Inc. Options Options granted Yu, David 5 19/11/2014 51 24.75 -1,500 Equitable Group Inc. Options Options granted Yu, David 5 19/11/2014 51 24.75 -1,500 Equitable Group Inc. Options Options granted Yu, David 5 19/11/2014 51 24.75 8,442 -1,500 Equity Financial Holdings Rights Deferred Share Bissada, Yousry 7 12/08/2014 00 Inc. (formerly, Grey Horse Units Corporation) Equity Financial Holdings Rights Deferred Share Bissada, Yousry 7 11/11/2014 56 8.12 703 703 Inc. (formerly, Grey Horse Units Corporation) Equity Financial Holdings Rights Deferred Share Calder, Brendan 4 28/05/2014 00 Inc. (formerly, Grey Horse Units Corporation) Equity Financial Holdings Rights Deferred Share Calder, Brendan 4 11/11/2014 56 8.12 1,657 1,657 Inc. (formerly, Grey Horse Units Corporation) Equity Financial Holdings Rights Deferred Share Griggs, Stephen John 4 26/02/2014 00 Inc. (formerly, Grey Horse Units Corporation) Equity Financial Holdings Rights Deferred Share Griggs, Stephen John 4 11/11/2014 56 8.12 4,074 4,074 Inc. (formerly, Grey Horse Units Corporation) Equity Financial Holdings Rights Deferred Share Kipp, Bradley Robert 4 11/11/2014 56 8.12 11,847 1,909 Inc. (formerly, Grey Horse Units Corporation)
November 27, 2014 (2014), 37 OSCB 10604
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Equity Financial Holdings Rights Deferred Share McCarthy, Michele, Daphne 4 26/02/2014 00 Inc. (formerly, Grey Horse Units Corporation) Equity Financial Holdings Rights Deferred Share McCarthy, Michele, Daphne 4 11/11/2014 56 8.12 1,391 1,391 Inc. (formerly, Grey Horse Units Corporation) Equity Financial Holdings Rights Deferred Share Mulvihill,, William 7 12/08/2014 00 Inc. (formerly, Grey Horse Units Corporation) Equity Financial Holdings Rights Deferred Share Mulvihill,, William 7 11/11/2014 56 8.12 681 681 Inc. (formerly, Grey Horse Units Corporation) Equity Financial Holdings Rights Deferred Share Ouellet, Martin 4 28/05/2014 00 Inc. (formerly, Grey Horse Units Corporation) Equity Financial Holdings Rights Deferred Share Ouellet, Martin 4 11/11/2014 56 8.12 944 944 Inc. (formerly, Grey Horse Units Corporation) Equity Financial Holdings Rights Deferred Share Rounthwaite, Frederic David 4 26/02/2014 00 Inc. (formerly, Grey Horse Units Corporation) Equity Financial Holdings Rights Deferred Share Rounthwaite, Frederic David 4 11/11/2014 56 8.12 1,214 1,214 Inc. (formerly, Grey Horse Units Corporation) Equity Financial Holdings Rights Deferred Share Silvestri, Glen 4 26/02/2014 00 Inc. (formerly, Grey Horse Units Corporation) Equity Financial Holdings Rights Deferred Share Silvestri, Glen 4 11/11/2014 56 8.12 2,504 2,504 Inc. (formerly, Grey Horse Units Corporation) Erdene Resource Common Shares Akerley, Peter 4, 5 18/11/2014 10 0.111 652,925 14,000 Development Corporation Eskay Mining Corp Options Balkam, Hugh McLellan 4 12/02/2014 50 1,500,000 Eskay Mining Corp Options Balkam, Hugh McLellan 4 12/02/2014 50 4,200,000 1,500,000 Eskay Mining Corp Options Balkam, Hugh McLellan 4 20/10/2014 52 3,500,000 -700,000 Eskay Mining Corp Options Balkam, Hugh McLellan 4 19/11/2014 50 4,200,000 700,000 Eskay Mining Corp Warrants Balkam, Hugh McLellan 4 12/07/2012 55 0 -100,000 Eskay Mining Corp Options McMehen, John Gordon 4 12/02/2014 50 750,000 Eskay Mining Corp Options McMehen, John Gordon 4 12/02/2014 50 1,750,000 750,000 Espial Group Inc. Common Shares Smith, Carl Gilbert 5 14/11/2014 10 1.4 149,743 2,600 Espial Group Inc. Common Shares Smith, Carl Gilbert 5 18/11/2014 10 1.4 152,743 3,000 Ethos Gold Corp. Common Shares Freeman, Gary Richard 4, 5 19/11/2014 10 0.132 2,001,207 30,500 Ethos Gold Corp. Common Shares Freeman, Gary Richard 4, 5 20/11/2014 10 0.135 2,011,207 10,000 European Strategic Balanced Units Landry Investment 8 18/11/2014 10 8.24 227,600 500 Fund Management Inc. European Strategic Balanced Units Landry Investment 8 19/11/2014 10 8.25 229,600 2,000 Fund Management Inc. European Strategic Balanced Units Landry Investment 8 20/11/2014 10 8.25 232,600 3,000 Fund Management Inc. Everton Resources Inc. Options Audet, André 4 20/11/2014 52 950,000 -40,000 Everton Resources Inc. Options Farrant, Michael Hugh 4 20/11/2014 52 1.1 260,000 -10,000 Exchange Income Common Shares Olin, Jeffrey 4 13/11/2014 10 21.523 39,748 -12,210 Corporation Exchange Income Common Shares Olin, Jeffrey 4 13/11/2014 10 21.5 18,275 -21,473 Corporation Exchange Income Common Shares Olin, Jeffrey 4 14/11/2014 10 22.194 0 -18,275 Corporation Exchange Income Common Shares Olin, Jeffrey 4 13/11/2014 10 21.523 11,167 -5,878 Corporation Exchange Income Common Shares Olin, Jeffrey 4 13/11/2014 10 21.5 5,134 -6,033 Corporation Exchange Income Common Shares Olin, Jeffrey 4 14/11/2014 10 22.194 0 -5,134 Corporation Exchange Income Common Shares Olin, Jeffrey 4 13/11/2014 10 21.523 4,707 -11,029 Corporation Exchange Income Common Shares Olin, Jeffrey 4 13/11/2014 10 21.5 2,165 -2,542 Corporation
November 27, 2014 (2014), 37 OSCB 10605
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Exchange Income Common Shares Olin, Jeffrey 4 14/11/2014 10 22.194 0 -2,165 Corporation Exchange Income Common Shares Olin, Jeffrey 4 13/11/2014 10 21.523 1,948 -883 Corporation Exchange Income Common Shares Olin, Jeffrey 4 13/11/2014 10 21.5 896 -1,052 Corporation Exchange Income Common Shares Olin, Jeffrey 4 14/11/2014 10 22.194 0 -896 Corporation Faircourt Split Trust Trust Units Faircourt Asset 8 17/11/2014 10 6.85 3,500 400 Management Inc. Faircourt Split Trust Trust Units Faircourt Asset 8 20/11/2014 10 6.8783 4,100 600 Management Inc. FAM Real Estate Investment Trust Units Huntingdon Capital Corp. 3 17/11/2014 35 7.64 1,687,250 38,972 Trust Fiera Capital Corporation Restricted Share Units VAILLANCOURT, PAUL 5 17/11/2014 00 65,048 (formerly Fiera Sceptre Inc.) LAURENT Finning International Inc. Units Deferred Share Awad, Marcelo 4 20/11/2014 56 27.548 2,442 272 Units Finning International Inc. Units Deferred Share Cote, Jacynthe 4 20/11/2014 56 27.548 215 109 Units Finning International Inc. Units Deferred Share Hartery, Nicholas 4 20/11/2014 56 27.548 2,712 272 Units Finning International Inc. Units Deferred Share O'Neill, Kathleen M. 4 20/11/2014 56 27.548 35,315 136 Units Finning International Inc. Units Deferred Share Wilson, Michael M. 4 20/11/2014 56 27.548 11,498 272 Units First Capital Realty Inc. Common Shares Kozak, Brian 5 17/11/2014 10 18.75 85,000 -800 First Capital Realty Inc. Common Shares Kozak, Brian 5 17/11/2014 10 18.751 82,800 -2,200 First Capital Realty Inc. Common Shares Kozak, Brian 5 17/11/2014 10 18.76 72,100 -10,700 First Capital Realty Inc. Common Shares Kozak, Brian 5 17/11/2014 10 18.769 69,800 -2,300 First Capital Realty Inc. Common Shares Kozak, Brian 5 17/11/2014 10 18.774 66,800 -3,000 First Capital Realty Inc. Common Shares Kozak, Brian 5 17/11/2014 10 18.8 64,800 -2,000 First Capital Realty Inc. Common Shares Kozak, Brian 5 17/11/2014 10 18.81 62,800 -2,000 First Capital Realty Inc. Common Shares Kozak, Brian 5 17/11/2014 10 18.735 59,800 -3,000 First Capital Realty Inc. Common Shares Kozak, Brian 5 17/11/2014 10 18.75 56,700 -3,100 First Capital Realty Inc. Common Shares Kozak, Brian 5 17/11/2014 10 18.756 52,800 -3,900 First Capital Realty Inc. Common Shares Kozak, Brian 5 18/11/2014 10 18.731 49,800 -3,000 First Capital Realty Inc. Common Shares Kozak, Brian 5 18/11/2014 10 18.74 28,800 -21,000 First Capital Realty Inc. Common Shares Kozak, Brian 5 18/11/2014 10 18.74 25,800 -3,000 First Capital Realty Inc. Common Shares Kozak, Brian 5 18/11/2014 10 18.75 21,300 -4,500 First Capital Realty Inc. Common Shares Kozak, Brian 5 18/11/2014 10 18.76 18,900 -2,400 First Capital Realty Inc. Common Shares Kozak, Brian 5 18/11/2014 10 18.764 17,400 -1,500 First Capital Realty Inc. Common Shares Kozak, Brian 5 18/11/2014 10 18.775 15,800 -1,600 First Capital Realty Inc. Common Shares Kozak, Brian 5 19/11/2014 51 13.91 71,800 56,000 First Capital Realty Inc. Options Kozak, Brian 5 19/11/2014 51 13.91 330,209 -56,000 First Mexican Gold Corp. Options Roberts, Gregory 4 09/09/2011 50 0.25 100,000 First Mexican Gold Corp. Options Roberts, Gregory 4 09/09/2011 50 0.25 400,000 -100,000 First Mexican Gold Corp. Options Roberts, Gregory 4 18/11/2014 50 0.06 1,425,000 525,000 First National Mortgage Units Tawse, Moray 4 11/11/2014 10 8.24 7,200 1,800 Investment Fund First National Mortgage Units Tawse, Moray 4 20/11/2014 10 8.2 21,600 3,000 Investment Fund First National Mortgage Units Tawse, Moray 4 20/11/2014 10 8.2 24,600 3,000 Investment Fund First National Mortgage Units Tawse, Moray 4 21/11/2014 10 8.25 26,000 1,400 Investment Fund First National Mortgage Units Tawse, Moray 4 21/11/2014 10 8.25 8,800 5,000 Investment Fund First National Mortgage Units Tawse, Moray 4 11/11/2014 10 8.25 5,300 1,500 Investment Fund First National Mortgage Units Tawse, Moray 4 14/11/2014 10 8.25 6,600 1,300 Investment Fund First National Mortgage Units Tawse, Moray 4 20/11/2014 10 8.25 12,500 5,900 Investment Fund
November 27, 2014 (2014), 37 OSCB 10606
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed First National Mortgage Units Tawse, Moray 4 20/11/2014 10 8.25 13,500 1,000 Investment Fund FIRSTSERVICE Subordinate Voting FirstService Corporation 1 20/11/2014 38 0 -116,900 CORPORATION Shares FIRSTSERVICE Subordinate Voting FirstService Corporation 1 20/11/2014 10 58.09 1,000 1,000 CORPORATION Shares FIRSTSERVICE Subordinate Voting FirstService Corporation 1 20/11/2014 10 69 2,000 1,000 CORPORATION Shares FIRSTSERVICE Subordinate Voting FirstService Corporation 1 20/11/2014 10 58.25 2,700 700 CORPORATION Shares FIRSTSERVICE Subordinate Voting FirstService Corporation 1 20/11/2014 10 58.05 3,900 1,200 CORPORATION Shares FIRSTSERVICE Subordinate Voting FirstService Corporation 1 20/11/2014 10 58.13 4,900 1,000 CORPORATION Shares FIRSTSERVICE Subordinate Voting Mayer, Christian 5 13/11/2014 10 59 75,451 -1,700 CORPORATION Shares FIRSTSERVICE Subordinate Voting Mayer, Christian 5 14/11/2014 10 59 75,351 -100 CORPORATION Shares FIRSTSERVICE Subordinate Voting Mayer, Christian 5 17/11/2014 10 59.1 70,351 -5,000 CORPORATION Shares FIRSTSERVICE Subordinate Voting Mayer, Christian 5 19/11/2014 10 59.1 64,751 -5,600 CORPORATION Shares FIRSTSERVICE Options Reichheld, Frederick 4 08/04/2014 00 CORPORATION FIRSTSERVICE Options Reichheld, Frederick 4 17/11/2014 50 51.66 5,000 5,000 CORPORATION Formation Metals Inc. Common Shares Farquharson, John Paul 5 17/11/2014 10 0.14 270,337 -97,143 Formation Metals Inc. Common Shares Farquharson, John Paul 5 17/11/2014 10 0.145 245,337 -25,000 Fortis Inc. Common Shares Ludlow, Earl 5 20/11/2014 51 28.27 102,975 35,552 Fortis Inc. Common Shares Ludlow, Earl 5 20/11/2014 10 39.152 73,412 -29,563 Fortis Inc. Options Ludlow, Earl 5 20/11/2014 51 249,400 -35,552 Fortis Inc. Common Shares Smith, Karl W. 5 21/11/2014 51 28.27 132,248 40,856 Fortis Inc. Options Smith, Karl W. 5 21/11/2014 51 335,557 -40,856 Fortis Inc. Common Shares Walker, John C. 5 17/11/2014 51 49,575 42,216 Fortis Inc. Common Shares Walker, John C. 5 17/11/2014 10 38.06 47,075 -2,500 Fortis Inc. Common Shares Walker, John C. 5 17/11/2014 10 37.99 46,575 -500 Fortis Inc. Common Shares Walker, John C. 5 17/11/2014 10 38 40,975 -5,600 Fortis Inc. Common Shares Walker, John C. 5 17/11/2014 10 38.03 39,575 -1,400 Fortis Inc. Common Shares Walker, John C. 5 17/11/2014 10 38.05 27,375 -12,200 Fortis Inc. Common Shares Walker, John C. 5 17/11/2014 10 37.97 20,759 -6,616 Fortis Inc. Common Shares Walker, John C. 5 17/11/2014 10 38.04 17,859 -2,900 Fortis Inc. Common Shares Walker, John C. 5 17/11/2014 10 38.07 17,459 -400 Fortis Inc. Common Shares Walker, John C. 5 17/11/2014 10 38.01 14,959 -2,500 Fortis Inc. Common Shares Walker, John C. 5 17/11/2014 10 38.02 7,359 -7,600 Fortis Inc. Common Shares Walker, John C. 5 17/11/2014 51 109,987 12,955 Fortis Inc. Options Walker, John C. 5 17/11/2014 51 302,744 -12,955 Fortis Inc. Options Walker, John C. 5 17/11/2014 51 260,528 -42,216 Fortress Paper Ltd. Common Shares Class A Pelletier, Yvon 7 17/11/2014 57 2.26 26,587 15,000 voting without par value Fortress Paper Ltd. Rights Performance Share Pelletier, Yvon 7 17/11/2014 57 2.26 15,933 -15,000 Units Fortuna Silver Mines Inc. Common Shares Ganoza Durant, Jorge A. 4 17/11/2014 10 5.19 31,500 -600 Fortuna Silver Mines Inc. Common Shares Ganoza Durant, Jorge A. 4 17/11/2014 10 5.2 30,500 -1,000 Fortuna Silver Mines Inc. Common Shares Ganoza Durant, Jorge A. 4 18/11/2014 51 4.03 67,100 36,600 Fortuna Silver Mines Inc. Common Shares Ganoza Durant, Jorge A. 4 18/11/2014 10 5.2 57,100 -10,000 Fortuna Silver Mines Inc. Common Shares Ganoza Durant, Jorge A. 4 18/11/2014 10 5.26 47,100 -10,000 Fortuna Silver Mines Inc. Common Shares Ganoza Durant, Jorge A. 4 18/11/2014 10 5.27 42,100 -5,000 Fortuna Silver Mines Inc. Common Shares Ganoza Durant, Jorge A. 4 18/11/2014 10 5.29 37,100 -5,000 Fortuna Silver Mines Inc. Common Shares Ganoza Durant, Jorge A. 4 18/11/2014 10 5.3 32,100 -5,000 Fortuna Silver Mines Inc. Common Shares Ganoza Durant, Jorge A. 4 20/11/2014 51 4.03 71,300 39,200 Fortuna Silver Mines Inc. Common Shares Ganoza Durant, Jorge A. 4 20/11/2014 10 5.2 57,200 -14,100 Fortuna Silver Mines Inc. Common Shares Ganoza Durant, Jorge A. 4 20/11/2014 10 5.205 55,800 -1,400
November 27, 2014 (2014), 37 OSCB 10607
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Fortuna Silver Mines Inc. Common Shares Ganoza Durant, Jorge A. 4 20/11/2014 10 5.21 37,100 -18,700 Fortuna Silver Mines Inc. Common Shares Ganoza Durant, Jorge A. 4 20/11/2014 10 5.22 32,100 -5,000 Fortuna Silver Mines Inc. Options Ganoza Durant, Jorge A. 4 18/11/2014 51 1,374,878 -36,600 Fortuna Silver Mines Inc. Options Ganoza Durant, Jorge A. 4 20/11/2014 51 1,335,678 -39,200 Fortune Bay Corp. Common Shares Dawe, Wade K. 5 13/11/2014 10 0.31 522,000 28,500 Fortune Bay Corp. Common Shares Dawe, Wade K. 5 13/11/2014 10 0.3 572,000 50,000 Fortune Bay Corp. Common Shares Dawe, Wade K. 5 13/11/2014 10 0.305 576,000 4,000 Fortune Bay Corp. Common Shares Dawe, Wade K. 5 13/11/2014 10 0.3 885,000 85,000 Fortune Bay Corp. Common Shares Dawe, Wade K. 5 14/11/2014 10 0.3 899,000 14,000 Fortune Bay Corp. Common Shares Dawe, Wade K. 5 14/11/2014 10 0.305 900,000 1,000 Fortune Bay Corp. Common Shares Dawe, Wade K. 5 14/11/2014 10 0.31 900,500 500 Fortune Bay Corp. Common Shares Dawe, Wade K. 5 14/11/2014 10 0.315 903,500 3,000 Fortune Bay Corp. Common Shares Dawe, Wade K. 5 14/11/2014 10 0.32 980,000 76,500 Fortune Minerals Limited Common Shares Williams, James Woodrow 4 20/11/2014 11 0.25 27,795,033 9,167,320 Franco-Nevada Corporation Common Shares McEnaney, Debbie 5 19/11/2014 51 15.2 15,400 15,400 Franco-Nevada Corporation Common Shares McEnaney, Debbie 5 19/11/2014 10 63.144 0 -15,400 Franco-Nevada Corporation Options McEnaney, Debbie 5 19/11/2014 51 15.2 7,100 -15,400 Franco-Nevada Corporation Common Shares Sparkes, Kerry Elwyn 5 04/11/2013 00 Franco-Nevada Corporation Common Shares Sparkes, Kerry Elwyn 5 19/11/2014 51 45.85 18,000 18,000 Franco-Nevada Corporation Common Shares Sparkes, Kerry Elwyn 5 19/11/2014 10 62.732 0 -18,000 Franco-Nevada Corporation Options Sparkes, Kerry Elwyn 5 19/11/2014 51 45.85 37,000 -18,000 Franco-Nevada Corporation Common Shares Wilson, Philip Dane 5 19/11/2014 51 31.45 14,251 10,000 Franco-Nevada Corporation Common Shares Wilson, Philip Dane 5 19/11/2014 10 63.355 4,251 -10,000 Franco-Nevada Corporation Options Wilson, Philip Dane 5 19/11/2014 51 31.45 78,544 -10,000 Freehold Royalties Ltd. Common Shares Canadian National Railway 3 17/11/2014 30 20.25 14,780,792 101,486 Company, Administrator of the CN Trust Funds Freehold Royalties Ltd. Common Shares Canadian National Railway 3 17/11/2014 30 20.25 4,775,447 32,789 Company, Administrator of the CN Trust Funds Galane Gold Ltd. Deferred Share Units Doolan, Stephen Patrick 5 10/11/2014 00 210,000 Galway Metals Inc. Common Shares Jaguar Financial 3 20/11/2014 10 0.14 6,076,000 40,000 Corporation George Weston Limited Common Shares Nixon, Gordon Melbourne 4 17/11/2014 00 5,000 George Weston Limited Common Shares Wasti, Rashid 5 19/11/2014 10 96.853 0 -1,000 Getty Copper Inc. Common Shares Lepinski, John Brent 4, 5 06/11/2014 90 0.03 13,889,600 Getty Copper Inc. Common Shares Lepinski, John Brent 4, 5 06/11/2014 90 0.03 13,889,600 Getty Copper Inc. Common Shares Lepinski, John Brent 4, 5 06/11/2014 90 0.03 17,072,850 13,889,600 Getty Copper Inc. Common Shares Lepinski, John Brent 4, 5 06/11/2014 90 0.03 1,252,797 Getty Copper Inc. Common Shares Lepinski, John Brent 4, 5 06/11/2014 90 0.03 18,325,647 1,252,797 Getty Copper Inc. Common Shares Lepinski, John Brent 4, 5 06/11/2014 90 0.03 -13,889,600 Getty Copper Inc. Common Shares Lepinski, John Brent 4, 5 06/11/2014 90 0.03 -13,889,600 Getty Copper Inc. Common Shares Lepinski, John Brent 4, 5 06/11/2014 90 0.03 -13,889,600 Getty Copper Inc. Common Shares Lepinski, John Brent 4, 5 06/11/2014 90 0.03 -13,889,600 Getty Copper Inc. Common Shares Lepinski, John Brent 4, 5 06/11/2014 90 0.03 0 -13,889,600 Getty Copper Inc. Common Shares Lepinski, John Brent 4, 5 06/11/2014 90 0.03 -1,252,797 Getty Copper Inc. Common Shares Lepinski, John Brent 4, 5 06/11/2014 90 0.03 0 -1,252,797 Gibson Energy Inc. Common Shares Fowlis, Donald Andrew 5 20/11/2014 10 72,590 -12,000 Gildan Activewear Inc. Common Shares Joyce, Kenneth van 7 03/10/2014 57 60.98 1,801 Gildan Activewear Inc. Common Shares Joyce, Kenneth van 7 03/10/2014 57 60.98 1,801 1,801 GLENTEL Inc. Common Shares DeVuyst, Dirk C.A. 4 12/11/2014 10 11.15 4,900 GLENTEL Inc. Common Shares DeVuyst, Dirk C.A. 4 12/11/2014 10 11.14 100 GLENTEL Inc. Common Shares DeVuyst, Dirk C.A. 4 17/11/2014 10 11.092 5,500 GLENTEL Inc. Common Shares DeVuyst, Dirk C.A. 4 18/11/2014 10 11.15 5,500 GLENTEL Inc. Common Shares DeVuyst, Dirk C.A. 4 13/11/2014 10 11.07 24,700 1,200 GLENTEL Inc. Common Shares DeVuyst, Dirk C.A. 4 13/11/2014 10 11.08 25,700 1,000 GLENTEL Inc. Common Shares DeVuyst, Dirk C.A. 4 13/11/2014 10 11.06 26,200 500 GLENTEL Inc. Common Shares DeVuyst, Dirk C.A. 4 13/11/2014 10 11.03 27,200 1,000 GLENTEL Inc. Common Shares DeVuyst, Dirk C.A. 4 14/11/2014 10 11.05 28,200 1,000 GLENTEL Inc. Common Shares DeVuyst, Dirk C.A. 4 14/11/2014 10 11 30,200 2,000
November 27, 2014 (2014), 37 OSCB 10608
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed GLENTEL Inc. Common Shares DeVuyst, Dirk C.A. 4 14/11/2014 10 10.95 31,200 1,000 GLENTEL Inc. Common Shares DeVuyst, Dirk C.A. 4 17/11/2014 10 11.05 31,700 500 GLENTEL Inc. Common Shares DeVuyst, Dirk C.A. 4 17/11/2014 10 11.09 32,200 500 GLENTEL Inc. Common Shares DeVuyst, Dirk C.A. 4 17/11/2014 10 11.1 34,200 2,000 GLENTEL Inc. Common Shares DeVuyst, Dirk C.A. 4 18/11/2014 10 11.15 37,200 3,000 GLENTEL Inc. Common Shares DeVuyst, Dirk C.A. 4 18/11/2014 10 11.3 37,400 200 GLENTEL Inc. Common Shares DeVuyst, Dirk C.A. 4 18/11/2014 10 11.366 38,200 800 GLENTEL Inc. Common Shares DeVuyst, Dirk C.A. 4 12/11/2014 10 11.15 27,271 4,900 GLENTEL Inc. Common Shares DeVuyst, Dirk C.A. 4 12/11/2014 10 11.14 27,371 100 GLENTEL Inc. Common Shares DeVuyst, Dirk C.A. 4 17/11/2014 10 11.092 32,871 5,500 GLENTEL Inc. Common Shares DeVuyst, Dirk C.A. 4 18/11/2014 10 11.15 38,371 5,500 Global Dividend Growers Trust Units Global Dividend Growers 1 14/11/2014 38 11.3 1,682,926 2,000 Income Fund Income Fund Global Dividend Growers Trust Units Global Dividend Growers 1 17/11/2014 38 11.3 1,683,526 600 Income Fund Income Fund Global Dividend Growers Trust Units Global Dividend Growers 1 18/11/2014 10 11.25 1,682,526 -1,000 Income Fund Income Fund Global Dividend Growers Trust Units Global Dividend Growers 1 19/11/2014 38 11.206 1,686,726 4,200 Income Fund Income Fund Global Dividend Growers Trust Units Global Dividend Growers 1 20/11/2014 38 11.227 1,693,126 6,400 Income Fund Income Fund Global Healthcare Dividend Trust Units Global Healthcare Dividend 1 17/11/2014 38 10.1 1,600 800 Fund Fund Global Hemp Group Inc. Common Shares Class A Larsen, Charles 4, 5 12/12/2013 00 Global Hemp Group Inc. Common Shares Class A Larsen, Charles 4, 5 20/06/2014 11 0.01 6,500,000 6,500,000 Global Hemp Group Inc. Options Larsen, Charles 4, 5 12/12/2013 00 Global Hemp Group Inc. Options Larsen, Charles 4, 5 12/12/2013 00 Global Hemp Group Inc. Options Larsen, Charles 4, 5 07/04/2014 50 0.1 5,100,000 Global Hemp Group Inc. Options Larsen, Charles 4, 5 07/04/2014 50 0.1 5,100,000 Global Infrastructure Trust Units Brasseur, Jeremy 6 19/11/2014 10 9.86 7,000 -1,500 Dividend Fund Global Infrastructure Trust Units Global Infrastructure 1 14/11/2014 38 9.8106 368,300 7,700 Dividend Fund Dividend Fund Global Infrastructure Trust Units Global Infrastructure 1 17/11/2014 38 9.879 377,400 9,100 Dividend Fund Dividend Fund Global Infrastructure Trust Units Global Infrastructure 1 18/11/2014 38 9.7573 392,400 15,000 Dividend Fund Dividend Fund Global Infrastructure Trust Units Global Infrastructure 1 19/11/2014 38 9.7749 399,800 7,400 Dividend Fund Dividend Fund Global Infrastructure Trust Units Global Infrastructure 1 20/11/2014 38 9.7222 403,000 3,200 Dividend Fund Dividend Fund GMP Capital Inc. Common Shares Ferguson, David Cadwell 4 07/08/2014 00 GMP Capital Inc. Common Shares Ferguson, David Cadwell 4 17/11/2014 10 6.1 1,000 1,000 GMP Capital Inc. Common Shares Ferguson, David Cadwell 4 07/08/2014 00 GMP Capital Inc. Common Shares Ferguson, David Cadwell 4 17/11/2014 10 6.1 3,700 3,700 GMP Capital Inc. Common Shares Ferguson, David Cadwell 4 17/11/2014 10 6.11 4,500 800 GMP Capital Inc. Common Shares Ferguson, David Cadwell 4 17/11/2014 10 6.12 6,500 2,000 Goldgroup Mining Inc. Common Shares Ingram, David Laurence 4 12/11/2014 00 Goldgroup Mining Inc. Common Shares Ingram, David Laurence 4 12/11/2014 00 363,400 Goldman Sachs U.S. Income Units Class A Brompton Corp. 7 13/11/2014 10 8.75 263,499 -10,000 Builder Trust Goldman Sachs U.S. Income Units Class A Brompton Corp. 7 18/11/2014 10 8.72 238,499 -25,000 Builder Trust Goldman Sachs U.S. Income Units Class A Brompton Corp. 7 18/11/2014 10 8.75 218,499 -20,000 Builder Trust Goldman Sachs U.S. Income Units Class A Brompton Corp. 7 19/11/2014 10 8.75 210,999 -7,500 Builder Trust Goldman Sachs U.S. Income Units Class A Brompton Corp. 7 19/11/2014 10 8.74 170,999 -40,000 Builder Trust Goldman Sachs U.S. Income Units Class A Brompton Corp. 7 20/11/2014 10 8.8 144,499 -26,500 Builder Trust Goldman Sachs U.S. Income Units Class A Brompton Corp. 7 20/11/2014 10 8.74 124,499 -20,000 Builder Trust
November 27, 2014 (2014), 37 OSCB 10609
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Goldspike Exploration Inc. Common Shares Inwentash, Sheldon 3 19/11/2014 10 0.4716 1,780,000 280,000 Grandview Gold Inc. Common Shares Cooper, Gordon Charles 3 13/12/2013 00 217,333 Grandview Gold Inc. Common Shares Cooper, Gordon Charles 3 13/12/2013 00 1,052,800 Grandview Gold Inc. Common Shares Cooper, Gordon Charles 3 13/12/2013 11 6,052,800 5,000,000 Grandview Gold Inc. Common Shares Cooper, Gordon Charles 3 13/12/2013 00 830,200 Grandview Gold Inc. Common Shares Cooper, Gordon Charles 3 13/12/2013 00 6,199,700 Grandview Gold Inc. Common Shares Cooper, Gordon Charles 3 13/12/2013 00 55,500 Grandview Gold Inc. Common Shares Cooper, Gordon Charles 3 13/12/2013 00 105,000 Grandview Gold Inc. Common Shares Cooper, Gordon Charles 3 13/12/2013 00 1,810,200 Granite REIT Inc. Deferred Share Units Brody, Michael Lawrence 4 14/11/2014 35 41.1 2,990 13 Granite REIT Inc. Restricted Share Units De Aragon, John 5 14/11/2014 35 41.1 17,792 79 Granite REIT Inc. Deferred Share Units Dey, Peter James 4 14/11/2014 35 41.1 6,865 30 Granite REIT Inc. Restricted Share Units Forsayeth, Michael Peter 5 14/11/2014 35 41.1 9,050 40 Granite REIT Inc. Deferred Share Units Gilbertson, Barry Gordon 4 14/11/2014 35 41.1 6,218 27 Granite REIT Inc. Restricted Share Units Heslip, Thomas Hugh 4, 5 14/11/2014 35 41.1 46,596 207 Granite REIT Inc. Restricted Share Units KUMER, LORNE 5 14/11/2014 35 41.1 4,526 20 Granite REIT Inc. Deferred Share Units Miller, Gerald 4 14/11/2014 35 41.1 2,990 13 Granite REIT Inc. Deferred Share Units Oran, Scott 4 14/11/2014 35 41.1 2,990 13 Granite REIT Inc. Restricted Share Units Tindale, Jennifer Sara 5 14/11/2014 35 41.1 4,526 20 Granite REIT Inc. Deferred Share Units Voorheis, George Wesley 4 14/11/2014 35 41.1 15,695 70 Thomas Granite REIT Inc. Restricted Share Units Wierzbinski, Stefan 5 14/11/2014 35 41.1 2,659 11 Great Canadian Gaming Common Shares Hart, Sarah J. 5 19/11/2014 51 7.62 19,625 15,440 Corporation Great Canadian Gaming Common Shares Hart, Sarah J. 5 19/11/2014 10 21.503 4,185 -15,440 Corporation Great Canadian Gaming Options Hart, Sarah J. 5 19/11/2014 51 7.62 -15,440 Corporation Great Canadian Gaming Options Hart, Sarah J. 5 19/11/2014 10 7.62 140,880 15,440 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 14/11/2014 10 21.74 103,100 -800 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 17/11/2014 10 21.51 97,400 -5,700 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 17/11/2014 10 21.52 96,100 -1,300 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 17/11/2014 10 21.53 94,300 -1,800 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 17/11/2014 10 21.54 93,600 -700 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 17/11/2014 10 21.55 90,300 -3,300 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 17/11/2014 10 21.59 90,100 -200 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 17/11/2014 10 21.6 86,200 -3,900 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 17/11/2014 10 21.66 83,700 -2,500 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 17/11/2014 10 21.69 83,000 -700 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 17/11/2014 10 21.7 78,400 -4,600 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 17/11/2014 10 21.71 77,600 -800 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 17/11/2014 10 21.72 77,500 -100 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 17/11/2014 10 21.73 77,400 -100 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 17/11/2014 10 21.75 77,300 -100 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 17/11/2014 10 21.78 76,800 -500 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 17/11/2014 10 21.8 75,600 -1,200 Corporation
November 27, 2014 (2014), 37 OSCB 10610
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Great Canadian Gaming Common Shares Soo, Walter 5 17/11/2014 10 21.81 75,400 -200 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 18/11/2014 10 21.5 71,600 -3,800 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 18/11/2014 10 21.51 71,400 -200 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 18/11/2014 10 21.52 66,900 -4,500 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 18/11/2014 10 21.53 66,100 -800 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 18/11/2014 10 21.54 66,000 -100 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 18/11/2014 10 21.545 65,900 -100 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 18/11/2014 10 21.55 62,600 -3,300 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 18/11/2014 10 21.555 62,400 -200 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 18/11/2014 10 21.59 57,400 -5,000 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 18/11/2014 10 21.6 45,500 -11,900 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 18/11/2014 10 21.61 45,000 -500 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 18/11/2014 10 21.62 44,500 -500 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 18/11/2014 10 21.63 -30 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 18/11/2014 10 21.63 44,200 -300 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 18/11/2014 10 21.64 44,100 -100 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 18/11/2014 10 21.645 41,500 -2,600 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 18/11/2014 10 21.65 38,000 -3,500 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 18/11/2014 10 21.66 36,100 -1,900 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 18/11/2014 10 21.665 36,000 -100 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 18/11/2014 10 21.68 34,600 -1,400 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 18/11/2014 10 21.685 34,300 -300 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 19/11/2014 10 21.65 34,000 -300 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 19/11/2014 10 21.66 33,800 -200 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 19/11/2014 10 21.675 33,700 -100 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 19/11/2014 10 21.68 32,800 -900 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 19/11/2014 10 21.69 28,100 -4,700 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 19/11/2014 10 21.73 27,500 -600 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 19/11/2014 10 21.77 27,000 -500 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 19/11/2014 10 21.76 26,300 -700 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 19/11/2014 10 21.78 26,100 -200 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 19/11/2014 10 21.79 24,800 -1,300 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 20/11/2014 10 21.32 24,700 -100 Corporation
November 27, 2014 (2014), 37 OSCB 10611
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Great Canadian Gaming Common Shares Soo, Walter 5 20/11/2014 10 21.33 23,300 -1,400 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 20/11/2014 10 21.34 16,700 -6,600 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 20/11/2014 10 21.345 16,600 -100 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 20/11/2014 10 21.35 15,500 -1,100 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 20/11/2014 10 21.43 14,100 -1,400 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 20/11/2014 10 21.46 13,400 -700 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 20/11/2014 10 21.5 10,600 -2,800 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 20/11/2014 10 21.53 10,400 -200 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 20/11/2014 10 21.54 10,000 -400 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 20/11/2014 10 21.59 6,700 -3,300 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 20/11/2014 10 21.61 5,800 -900 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 20/11/2014 10 21.62 5,600 -200 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 20/11/2014 10 21.63 5,200 -400 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 20/11/2014 10 21.69 1,200 -4,000 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 20/11/2014 10 21.74 1,000 -200 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 20/11/2014 10 21.76 700 -300 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 20/11/2014 10 21.765 600 -100 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 20/11/2014 10 21.77 400 -200 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 20/11/2014 10 21.88 0 -400 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 19/11/2014 10 21.5 185,790 -2,900 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 19/11/2014 10 21.51 179,590 -6,200 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 19/11/2014 10 21.52 174,490 -5,100 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 20/11/2014 10 21.41 166,090 -8,400 Corporation Great Canadian Gaming Common Shares Soo, Walter 5 20/11/2014 10 21.42 165,390 -700 Corporation Groundstar Resources Common Shares PREMJI, SHABIR 4, 5 18/11/2014 10 0.13 1,226,000 5,000 Limited Groundstar Resources Common Shares PREMJI, SHABIR 4, 5 18/11/2014 10 0.125 1,238,000 12,000 Limited Groundstar Resources Common Shares PREMJI, SHABIR 4, 5 19/11/2014 10 0.125 1,248,000 10,000 Limited GTA Resources and Mining Options Barr, Clinton 4 12/11/2014 50 0.07 275,000 100,000 Inc. GTA Resources and Mining Options Stares, Stephen 4 12/11/2014 50 0.07 172,500 100,000 Inc. Happy Creek Minerals Ltd. Common Shares Cathro, Michael 4 21/11/2014 10 0.105 115,500 10,000 Heatherdale Resources Ltd. Options Cousens, Scott Dibblee 4 17/11/2014 52 126,000 -120,000 High Arctic Energy Services Common Shares Wood, Jed Morgan 3 17/11/2014 47 4.4 -4,390,852 -1,250,000 Inc. High Liner Foods Common Shares High Liner Foods 1 12/11/2014 10 22.614 236,200 -12,200 Incorporated Incorporated High Liner Foods Common Shares High Liner Foods 1 13/11/2014 10 22.634 231,700 -4,500 Incorporated Incorporated
November 27, 2014 (2014), 37 OSCB 10612
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed High Liner Foods Common Shares High Liner Foods 1 14/11/2014 10 22.712 218,200 -13,500 Incorporated Incorporated High Liner Foods Common Shares High Liner Foods 1 17/11/2014 10 22.696 216,700 -1,500 Incorporated Incorporated High Liner Foods Common Shares High Liner Foods 1 19/11/2014 10 22.094 214,000 -2,700 Incorporated Incorporated High Liner Foods Common Shares MAHODY, Jolene 4 08/05/2014 00 Incorporated High Liner Foods Common Shares MAHODY, Jolene 4 19/11/2014 10 22.181 1,000 1,000 Incorporated High Liner Foods Common Shares van Schaayk, Frank 4 07/11/2014 00 Incorporated Bernard Harry High Liner Foods Common Shares van Schaayk, Frank 4 13/11/2014 10 22.306 800 800 Incorporated Bernard Harry Holloway Lodging Options Haw, Dustin 4 18/09/2013 00 Corporation Holloway Lodging Options Haw, Dustin 4 18/11/2014 50 6.37 30,000 30,000 Corporation Holloway Lodging Options Rafuse, Jane Catherine 5 18/11/2014 50 6.37 73,125 50,000 Corporation Holloway Lodging Options Rapps, Michael 4, 6 18/11/2014 50 160,000 60,000 Corporation Holloway Lodging Options Seiler, Felix Andreas 5 18/11/2014 50 6.37 80,000 50,000 Corporation Holloway Lodging Options Staniloff, Marc Leslie 4 18/11/2014 50 6.37 113,125 60,000 Corporation Holloway Lodging Common Shares Wood, David Allison 4 19/11/2014 10 6.5 8,267 2,200 Corporation Holloway Lodging Common Shares Wood, David Allison 4 19/11/2014 10 6.49 9,667 1,400 Corporation Holloway Lodging Common Shares Wood, David Allison 4 19/11/2014 10 6.48 9,967 300 Corporation Holloway Lodging Common Shares Wood, David Allison 4 19/11/2014 10 6.47 10,067 100 Corporation Holloway Lodging Options Wood, David Allison 4 18/11/2014 50 6.37 81,500 30,000 Corporation Home Capital Group Inc. Rights Deferred Share Beaurivage, Jacqueline 4 14/11/2014 35 50.05 963 4 Units Home Capital Group Inc. Rights Deferred Share Falk, William 4 14/11/2014 35 50.05 6,766 27 Units Home Capital Group Inc. Rights Deferred Share Graham, Diana Lynn 4 14/11/2014 35 50.05 2,604 11 Units Home Capital Group Inc. Rights Deferred Share Marsh, John M. 4 14/11/2014 35 50.05 8,290 33 Units Home Capital Group Inc. Rights Deferred Share Mitchell, Robert A. 4 14/11/2014 35 50.05 10,525 42 Units Home Capital Group Inc. Rights Deferred Share Smith, Kevin 4 14/11/2014 35 50.05 25,443 101 Units Homeland Uranium Inc. Common Shares Fryer, Russell 4 20/11/2014 00 Homeland Uranium Inc. Common Shares Fryer, Russell 4 20/11/2014 22 0.0038 939,000,000 939,000,000 Homeland Uranium Inc. Common Shares Fryer, Russell 4 20/11/2014 22 0.0038 1,878,000,000 939,000,000 Homeland Uranium Inc. Common Shares Fryer, Russell 4 20/11/2014 00 Homeland Uranium Inc. Common Shares Fryer, Russell 4 20/11/2014 22 0.0038 939,000,000 939,000,000 Homeland Uranium Inc. Common Shares Fryer, Russell 4 20/11/2014 22 0.0038 1,878,000,000 939,000,000 Homeland Uranium Inc. Common Shares Glasier, George Edwin Lee 4, 5 20/11/2014 00 Homeland Uranium Inc. Common Shares Glasier, George Edwin Lee 4, 5 20/11/2014 22 0.0038 968,000,000 968,000,000 Homeland Uranium Inc. Common Shares Glasier, George Edwin Lee 4, 5 20/11/2014 22 0.0038 1,936,000,000 968,000,000 Homeland Uranium Inc. Common Shares Glasier, George Edwin Lee 4, 5 20/11/2014 00 Homeland Uranium Inc. Common Shares Glasier, George Edwin Lee 4, 5 20/11/2014 22 0.0038 968,000,000 968,000,000 Homeland Uranium Inc. Common Shares Glasier, George Edwin Lee 4, 5 20/11/2014 22 0.0038 1,936,000,000 968,000,000 Homeland Uranium Inc. Common Shares Skutezky, Ernest Michael 4 20/11/2014 00 Rhodes Horizon North Logistics Inc. Options Graham, Roderick William 4, 5 18/11/2014 50 1.15 100,000 Horizon North Logistics Inc. Options Graham, Roderick William 4, 5 18/11/2014 50 1.15 100,000 Horizon North Logistics Inc. Common Shares Nabholz, Kevin Drew 4 18/11/2014 10 3.3 480,000 100,000
November 27, 2014 (2014), 37 OSCB 10613
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed HUMBOLDT CAPITAL Common Shares Humboldt Capital 1 18/11/2014 10 1.22 1,700 1,700 CORPORATION Corporation HUMBOLDT CAPITAL Common Shares Humboldt Capital 1 18/11/2014 38 1.22 0 -1,700 CORPORATION Corporation Hyduke Energy Services Inc. Common Shares ROSS, PATRICK 4, 5 01/04/2013 00 Hyduke Energy Services Inc. Common Shares ROSS, PATRICK 4, 5 20/11/2014 10 0.84 5,000 5,000 Hyduke Energy Services Inc. Common Shares ROSS, PATRICK 4, 5 20/11/2014 10 0.85 654,000 649,000 IMAX Corporation Common Shares Gelfond, Richard L. 4, 5 18/11/2014 51 18.38 213,524 53,791 IMAX Corporation Common Shares Gelfond, Richard L. 4, 5 18/11/2014 10 30.35 159,733 -53,791 IMAX Corporation Common Shares Gelfond, Richard L. 4, 5 19/11/2014 51 18.38 232,403 72,670 IMAX Corporation Common Shares Gelfond, Richard L. 4, 5 19/11/2014 10 30.18 159,733 -72,670 IMAX Corporation Common Shares Gelfond, Richard L. 4, 5 20/11/2014 51 18.38 233,272 73,539 IMAX Corporation Common Shares Gelfond, Richard L. 4, 5 20/11/2014 10 30.24 159,733 -73,539 IMAX Corporation Common Shares Gelfond, Richard L. 4, 5 20/11/2014 10 30.24 109,733 -50,000 IMAX Corporation Options 1:1 Gelfond, Richard L. 4, 5 18/11/2014 51 18.38 1,572,904 -53,791 IMAX Corporation Options 1:1 Gelfond, Richard L. 4, 5 19/11/2014 51 18.38 1,500,234 -72,670 IMAX Corporation Options 1:1 Gelfond, Richard L. 4, 5 20/11/2014 51 18.38 1,426,695 -73,539 IMAX Corporation Common Shares Girvan, Gary 4 19/11/2014 47 86,340 -1,325 Imperial Metals Corporation Common Shares Anglin, Carolyn Diane 5 08/09/2014 00 300 Indexplus Income Fund Trust Units INDEXPLUS Income Fund 1 14/11/2014 38 13.425 33,114,110 1,600 Indexplus Income Fund Trust Units INDEXPLUS Income Fund 1 17/11/2014 38 13.427 33,115,610 1,500 Indexplus Income Fund Trust Units INDEXPLUS Income Fund 1 18/11/2014 38 13.52 33,115,710 100 Indexplus Income Fund Trust Units INDEXPLUS Income Fund 1 20/11/2014 38 13.513 33,117,110 1,400 Indexplus Income Fund Trust Units INDEXPLUS Income Fund 1 20/11/2014 10 13.6 32,703,310 -413,800 Industrial Alliance Insurance Common Shares Sauvageau, Yvon 5 19/11/2014 51 26.03 2,108 2,000 and Financial Services inc. Industrial Alliance Insurance Common Shares Sauvageau, Yvon 5 19/11/2014 10 45.051 1,108 -1,000 and Financial Services inc. Industrial Alliance Insurance Common Shares Sauvageau, Yvon 5 19/11/2014 10 45.05 108 -1,000 and Financial Services inc. Industrial Alliance Insurance Options Sauvageau, Yvon 5 19/11/2014 51 26.03 60,000 -2,000 and Financial Services inc. Industrial Alliance Insurance Common Shares Stickney, Michael Lee 5 17/11/2014 51 30.22 14,900 2,000 and Financial Services inc. Industrial Alliance Insurance Common Shares Stickney, Michael Lee 5 17/11/2014 10 43.5 12,900 -2,000 and Financial Services inc. Industrial Alliance Insurance Common Shares Stickney, Michael Lee 5 18/11/2014 51 30.22 14,900 2,000 and Financial Services inc. Industrial Alliance Insurance Common Shares Stickney, Michael Lee 5 18/11/2014 10 44.4 12,900 -2,000 and Financial Services inc. Industrial Alliance Insurance Common Shares Stickney, Michael Lee 5 19/11/2014 51 30.22 16,400 3,500 and Financial Services inc. Industrial Alliance Insurance Common Shares Stickney, Michael Lee 5 19/11/2014 10 44.5 14,400 -2,000 and Financial Services inc. Industrial Alliance Insurance Common Shares Stickney, Michael Lee 5 19/11/2014 10 45.1 12,900 -1,500 and Financial Services inc. Industrial Alliance Insurance Options Stickney, Michael Lee 5 17/11/2014 51 30.22 228,000 -2,000 and Financial Services inc. Industrial Alliance Insurance Options Stickney, Michael Lee 5 18/11/2014 51 30.22 226,000 -2,000 and Financial Services inc. Industrial Alliance Insurance Options Stickney, Michael Lee 5 19/11/2014 51 30.22 222,500 -3,500 and Financial Services inc. Infrastructure Materials Corp. Common Shares Montgomery, Todd 3, 4 18/11/2014 10 0.01 66,755,224 220,000 InnVest Real Estate Trust Units KingSett Real Estate 3 17/11/2014 35 5.16 10,016,367 65,973 Investment Trust Growth LP No. 5 InnVest Real Estate Trust Units Love, Jon E. 4 17/11/2014 35 5.16 10,016,367 65,973 Investment Trust InnVest Real Estate Trust Units Nappert, Chantal 5 17/11/2014 35 5.16 6,080 40 Investment Trust InnVest Real Estate Trust Units Wolf, Robert Thomas 4 17/11/2014 35 5.16 20,771 137 Investment Trust Intact Financial Corporation Common Shares Barbeau, Patrick 5 19/11/2014 10 80.77 3,497 -500 Inter Pipeline Ltd. Common Shares Love, Alison Taylor 4 18/11/2014 10 34.7 6,686 300
November 27, 2014 (2014), 37 OSCB 10614
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Inter Pipeline Ltd. Common Shares Love, Alison Taylor 4 18/11/2014 10 34.68 7,136 450 International Northair Mines Common Shares Nowak, Brenda Ruth 5 05/09/2014 16 0.1 65,000 50,000 Ltd. International Northair Mines Warrants Nowak, Brenda Ruth 5 05/09/2014 16 0.18 52,500 50,000 Ltd. International Northair Mines Common Shares Tagami, Maurice Alan 4 05/09/2014 16 0.1 200,000 Ltd. International Northair Mines Common Shares Tagami, Maurice Alan 4 05/09/2014 16 0.1 200,000 Ltd. International Northair Mines Common Shares Tagami, Maurice Alan 4 08/09/2014 00 Ltd. International Northair Mines Common Shares Tagami, Maurice Alan 4 08/09/2014 00 200,000 Ltd. International Northair Mines Warrants Tagami, Maurice Alan 4 08/09/2014 00 Ltd. International Northair Mines Warrants Tagami, Maurice Alan 4 08/09/2014 00 200,000 Ltd. Intrepid Mines Limited Ordinary Shares McMaster, Ian Melville 4 18/11/2014 46 0.193 821,100 32,384 Intrepid Mines Limited Ordinary Shares Roberts, Alan Norman 4 18/11/2014 46 0.193 569,688 22,020 Jadela Oil Corp. Common Shares Leia, Gregory 4, 5 18/11/2014 10 1,272,000 262,000 Jet Metal Corp. Common Shares Expedition Mining Inc. 3 25/03/2010 10 0.195 100,000 Jet Metal Corp. Common Shares Expedition Mining Inc. 3 25/03/2010 10 0.195 6,659,000 -100,000 Jet Metal Corp. Common Shares Expedition Mining Inc. 3 26/03/2010 10 0.2 6,634,500 -24,500 Jet Metal Corp. Common Shares Expedition Mining Inc. 3 29/03/2010 10 0.2 6,600,000 -34,500 Jet Metal Corp. Common Shares Expedition Mining Inc. 3 30/03/2010 10 0.2 6,559,000 -41,000 Jet Metal Corp. Common Shares Expedition Mining Inc. 3 06/04/2010 10 0.2 6,557,000 -2,000 Jet Metal Corp. Common Shares Expedition Mining Inc. 3 07/04/2010 10 0.2 6,453,000 -104,000 Jet Metal Corp. Common Shares Expedition Mining Inc. 3 09/04/2010 10 0.2 6,431,000 -22,000 Jet Metal Corp. Common Shares Expedition Mining Inc. 3 13/04/2010 10 0.2 6,400,000 -31,000 Jet Metal Corp. Common Shares Expedition Mining Inc. 3 14/04/2010 10 0.19 6,250,000 -150,000 Journey Energy Inc. Common Shares Wettstein, Wieland 4 19/06/2014 00 Journey Energy Inc. Common Shares Wettstein, Wieland 4 18/11/2014 10 7.19 30,000 30,000 Jura Energy Corporation Common Shares Smith, Stephen Christopher 4 18/11/2014 10 0.21 1,038,000 20,000 Jura Energy Corporation Common Shares Smith, Stephen Christopher 4 19/11/2014 10 0.2 1,043,500 5,500 Jura Energy Corporation Common Shares Yarmie, Jennien May 5 17/11/2014 10 0.2 34,502 20,000 Jura Energy Corporation Common Shares Yarmie, Jennien May 5 17/11/2014 10 0.2 39,002 4,500 Kapuskasing Gold Corp. Common Shares MacNeill, Tom 3 18/11/2014 10 0.06 3,301,000 -200,000 Kapuskasing Gold Corp. Common Shares MacNeill, Tom 3 21/11/2014 11 0.0675 3,849,148 548,148 Karnalyte Resources Inc. Common Shares Goodman, Stephen 5 12/11/2014 00 Karnalyte Resources Inc. Common Shares Offet, Gerald 4 12/11/2014 00 Kelt Exploration Ltd. Common Shares Sinclair, Neil Graham 4 19/11/2014 10 9.4 18,500 Kelt Exploration Ltd. Common Shares Sinclair, Neil Graham 4 19/11/2014 10 9.4 18,500 Kelt Exploration Ltd. Common Shares Sinclair, Neil Graham 4 19/11/2014 10 9.37 31,500 Kelt Exploration Ltd. Common Shares Sinclair, Neil Graham 4 19/11/2014 10 9.37 31,500 Kelt Exploration Ltd. Common Shares Sinclair, Neil Graham 4 19/11/2014 10 9.4 2,084,357 32,500 Kelt Exploration Ltd. Common Shares Sinclair, Neil Graham 4 19/11/2014 10 9.37 2,151,857 67,500 Khalkos Exploration Inc. Common Shares Gagnon, Robert 4, 5 18/11/2014 10 0.1 1,658,666 10,000 Kingsway Arms Retirement Common Shares Schillaci, Joe 3 14/11/2014 10 0.025 2,242,000 390,000 Residences Inc. Kingsway Financial Services Common Shares Baqar, Hassan Raza 5 18/11/2014 10 5.7295 27,138 124 Inc. Kingsway Financial Services Common Shares Hickey, William A. 5 18/11/2014 10 5.7295 53,412 262 Inc. Kingsway Financial Services Common Shares Swets, Jr., Larry Gene 4, 5 18/11/2014 10 5.7295 660,276 363 Inc. Klondex Mines Ltd. Common Shares Doolin, Michael Benjamin 7 17/11/2014 10 1.61 68,866 -5,000 Jr. Labrador Iron Ore Royalty Common Shares Volker, Patricia Mary 4 29/05/2014 00 Corporation Labrador Iron Ore Royalty Common Shares Volker, Patricia Mary 4 14/11/2014 10 18.89 1,000 1,000 Corporation
November 27, 2014 (2014), 37 OSCB 10615
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Lake Shore Gold Corp. Options Crossgrove, Peter 4 17/11/2014 52 102,000 -102,000 Alexander Lake Shore Gold Corp. Options Federico, Alasdair James 5 17/11/2014 52 620,841 -75,000 Lake Shore Gold Corp. Options Gill, Jonathan 4 17/11/2014 52 102,000 -51,000 Lake Shore Gold Corp. Options Hallam, Frank 4 17/11/2014 52 4.13 102,000 -102,000 Lake Shore Gold Corp. Options Kallio, Eric 5 17/11/2014 52 1,498,461 -150,000 Lake Shore Gold Corp. Options Klassen, Arnold 4 17/11/2014 52 102,000 -51,000 Lake Shore Gold Corp. Options Makuch, Anthony Paul 5 17/11/2014 52 7,183,134 -492,000 Lake Shore Gold Corp. Options MOON, ALAN CLIFFORD 4, 5 10/11/2014 52 4.13 51,000 Lake Shore Gold Corp. Options MOON, ALAN CLIFFORD 4, 5 10/11/2014 52 4.13 102,000 -51,000 Lake Shore Gold Corp. Options Utting, Mark Elliott Forbes 5 17/11/2014 52 607,896 -90,000 Lake Shore Gold Corp. Options Verli, Merushe 5 17/11/2014 52 532,816 -75,000 Laramide Resources Ltd. Common Shares Henderson, Marc Charles 3, 4, 5 18/11/2014 10 0.42 7,306,712 25,000 Legacy Oil + Gas Inc. Common Shares Brockway, Randal H 4 19/11/2014 10 3.98 164,999 20,000 Legend Gold Corp. Common Shares Endeavour Mining 3 21/05/2014 11 7,300,000 2,500,000 Corporation Leo Resources Inc. Common Shares Wettreich, Daniel 4, 5 18/11/2014 10 0.4 2,679,100 500 Leo Resources Inc. Common Shares Wettreich, Daniel 4, 5 19/11/2014 10 0.4 2,679,600 500 Leucrotta Exploration Inc. Common Shares Trudeau, Terry 5 12/09/2014 11 1.7 530,000 Leucrotta Exploration Inc. Common Shares Trudeau, Terry 5 12/09/2014 11 1.7 590,220 530,220 Leucrotta Exploration Inc. Common Shares Trudeau, Terry 5 12/09/2014 11 1.7 552,440 Leucrotta Exploration Inc. Common Shares Trudeau, Terry 5 12/09/2014 11 1.7 1,049,653 537,514 Lexaria Corp. Common Shares Bunka, Christopher 4, 5 18/11/2014 10 0.082 3,535,741 41,800 Lexaria Corp. Common Shares Bunka, Christopher 4, 5 18/11/2014 10 0.082 3,585,741 50,000 Lexaria Corp. Common Shares Bunka, Christopher 4, 5 18/11/2014 10 0.08 500,000 Lexaria Corp. Common Shares Bunka, Christopher 4, 5 18/11/2014 10 0.08 3,635,741 50,000 Lexaria Corp. Common Shares Bunka, Christopher 4, 5 18/11/2014 10 0.085 3,655,741 20,000 Lexaria Corp. Common Shares Bunka, Christopher 4, 5 21/11/2014 10 0.107 3,690,741 35,000 Lightstream Resources Ltd. Common Shares Ruttan, Corey Christopher 4 14/11/2014 10 2.75 631,115 20,000 Linamar Corporation Common Shares JARRELL, JAMES 5 17/11/2014 10 64.251 19,949 -70,876 Lingo Media Corporation Options Bar-Ziv, Gali 5 17/11/2014 50 840,000 300,000 Lingo Media Corporation Options Bernholtz, Martin 4 18/09/2013 00 157,500 Lingo Media Corporation Options Bernholtz, Martin 4 17/11/2014 50 0.14 277,500 120,000 Lingo Media Corporation Options Gong, Tommy Weibing 4 26/09/2014 50 70,000 Lingo Media Corporation Options Gong, Tommy Weibing 4 26/09/2014 50 70,000 Lingo Media Corporation Options Gong, Tommy Weibing 4 26/09/2014 50 152,500 70,000 Lingo Media Corporation Options Gong, Tommy Weibing 4 26/09/2014 50 70,000 Lingo Media Corporation Options Gong, Tommy Weibing 4 26/09/2014 50 70,000 Lingo Media Corporation Options Gong, Tommy Weibing 4 17/11/2014 50 70,000 Lingo Media Corporation Options Gong, Tommy Weibing 4 17/11/2014 50 70,000 Lingo Media Corporation Options Gong, Tommy Weibing 4 17/11/2014 50 222,500 70,000 Lingo Media Corporation Options GRAFSTEIN, Jerahmiel 4 26/09/2014 50 80,000 Samson Lingo Media Corporation Options GRAFSTEIN, Jerahmiel 4 26/09/2014 50 80,000 Samson Lingo Media Corporation Options GRAFSTEIN, Jerahmiel 4 26/09/2014 50 192,500 80,000 Samson Lingo Media Corporation Options GRAFSTEIN, Jerahmiel 4 17/11/2014 50 80,000 Samson Lingo Media Corporation Options GRAFSTEIN, Jerahmiel 4 17/11/2014 50 80,000 Samson Lingo Media Corporation Options GRAFSTEIN, Jerahmiel 4 17/11/2014 50 272,500 80,000 Samson Lingo Media Corporation Options Kraft, Michael 4, 5 10/08/1996 00 Lingo Media Corporation Options Kraft, Michael 4, 5 17/11/2014 50 100,000 100,000 Lingo Media Corporation Options Qureshi, Khurram 5 17/11/2014 50 100,000 Lingo Media Corporation Options Qureshi, Khurram 5 17/11/2014 50 100,000 Lingo Media Corporation Options Qureshi, Khurram 5 17/11/2014 50 352,486 100,000 Lingo Media Corporation Options Remborg, Scott 4 26/09/2014 50 85,000 Lingo Media Corporation Options Remborg, Scott 4 26/09/2014 50 85,000
November 27, 2014 (2014), 37 OSCB 10616
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Lingo Media Corporation Options Remborg, Scott 4 26/09/2014 50 343,607 85,000 Lingo Media Corporation Options Remborg, Scott 4 17/11/2014 50 85,000 Lingo Media Corporation Options Remborg, Scott 4 17/11/2014 50 85,000 Lingo Media Corporation Options Remborg, Scott 4 17/11/2014 50 428,607 85,000 Liquor Stores N.A. Ltd. Rights Preferred Share Bebis, Stephen 5 07/05/2013 00 Units Liquor Stores N.A. Ltd. Rights Preferred Share Bebis, Stephen 5 17/11/2014 56 13.75 53,579 53,579 Units Liquor Stores N.A. Ltd. Rights Preferred Share Cobb, Erika 5 03/03/2014 00 Units Liquor Stores N.A. Ltd. Rights Preferred Share Cobb, Erika 5 17/11/2014 56 13.75 11,375 11,375 Units Liquor Stores N.A. Ltd. Rights Preferred Share Corbett, Craig David 5 31/12/2010 00 Units Liquor Stores N.A. Ltd. Rights Preferred Share Corbett, Craig David 5 17/11/2014 56 13.75 14,045 14,045 Units Liquor Stores N.A. Ltd. Rights Restricted Share Corbett, Craig David 5 31/12/2010 00 Units Liquor Stores N.A. Ltd. Rights Restricted Share Corbett, Craig David 5 17/11/2014 56 13.75 3,636 3,636 Units Liquor Stores N.A. Ltd. Rights Preferred Share Fremstad, Jason Paul 5 31/03/2014 00 Units Liquor Stores N.A. Ltd. Rights Preferred Share Fremstad, Jason Paul 5 17/11/2014 56 13.75 11,375 11,375 Units Liquor Stores N.A. Ltd. Common Shares Gordey, David Nathan 5 21/11/2014 10 14.58 5,201 2,825 Liquor Stores N.A. Ltd. Rights Preferred Share Gordey, David Nathan 5 26/03/2012 00 Units Liquor Stores N.A. Ltd. Rights Preferred Share Gordey, David Nathan 5 17/11/2014 56 13.75 10,473 10,473 Units Liquor Stores N.A. Ltd. Rights Restricted Share Gordey, David Nathan 5 26/03/2012 00 Units Liquor Stores N.A. Ltd. Rights Restricted Share Gordey, David Nathan 5 17/11/2014 56 13.75 3,636 3,636 Units Liquor Stores N.A. Ltd. Rights Preferred Share Renz, Catherine Lieske 5 04/03/2014 00 Units Liquor Stores N.A. Ltd. Rights Preferred Share Renz, Catherine Lieske 5 17/11/2014 56 13.75 10,881 10,881 Units Liquor Stores N.A. Ltd. Rights Restricted Share Renz, Catherine Lieske 5 04/03/2014 00 Units Liquor Stores N.A. Ltd. Rights Restricted Share Renz, Catherine Lieske 5 17/11/2014 56 13.75 2,909 2,909 Units Liquor Stores N.A. Ltd. Rights Preferred Share Rop, Steve 5 31/03/2014 00 Units Liquor Stores N.A. Ltd. Rights Preferred Share Rop, Steve 5 17/11/2014 56 13.75 12,364 12,364 Units Liquor Stores N.A. Ltd. Rights Preferred Share Yaworski, James 5 09/07/2014 00 Units Liquor Stores N.A. Ltd. Rights Preferred Share Yaworski, James 5 17/11/2014 56 13.75 6,545 6,545 Units Lithium Americas Corp. Common Shares Inwentash, Sheldon 3 13/11/2014 10 0.33 14,141,000 35,000 Lithium Americas Corp. Common Shares Inwentash, Sheldon 3 17/11/2014 10 0.3188 14,222,000 81,000 Lithium Americas Corp. Common Shares Inwentash, Sheldon 3 18/11/2014 10 0.37 14,227,000 5,000 Lithium Americas Corp. Common Shares Inwentash, Sheldon 3 19/11/2014 10 0.3914 14,365,000 138,000 Logistec Corporation Subordinate Voting LOGISTEC 1 17/11/2014 38 38.06 6,900 1,000 Shares Class B CORPORATION Logistec Corporation Subordinate Voting LOGISTEC 1 20/11/2014 38 41.15 7,800 900 Shares Class B CORPORATION Logistec Corporation Subordinate Voting LOGISTEC 1 21/11/2014 38 40.2 8,800 1,000 Shares Class B CORPORATION Logistec Corporation Subordinate Voting MANN, DAVID MCDANIEL 4, 5 20/11/2014 47 41.15 13,700 -2,500 Shares Class B Lucara Diamond Corp. Common Shares Clark, Richard Peter 4 19/02/2010 00 Lucara Diamond Corp. Common Shares Clark, Richard Peter 4 14/11/2014 51 0.7 133,333 133,333 Lucara Diamond Corp. Options Clark, Richard Peter 4 14/11/2014 51 0.7 66,667 -133,333
November 27, 2014 (2014), 37 OSCB 10617
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Lucara Diamond Corp. Common Shares Gabonowe, Ribson 7 17/11/2014 51 0.8 215,000 30,000 Champion Lucara Diamond Corp. Options Gabonowe, Ribson 7 17/11/2014 51 0.8 25,000 -30,000 Champion Lundin Mining Corporation Common Shares Charter, Donald Kinloch 4 01/11/2006 00 Lundin Mining Corporation Common Shares Charter, Donald Kinloch 4 20/11/2014 36 5.1 25,000 25,000 Lundin Mining Corporation Subscription Rights Charter, Donald Kinloch 4 20/11/2014 36 5.1 0 -25,000 Lundin Mining Corporation Common Shares Jones, Peter Clark 4 20/11/2014 36 5.1 25,000 Lundin Mining Corporation Common Shares Jones, Peter Clark 4 20/11/2014 36 5.1 25,000 Lundin Mining Corporation Common Shares Jones, Peter Clark 4 20/11/2014 36 5.1 51,482 29,412 Lundin Mining Corporation Subscription Rights Jones, Peter Clark 4 20/11/2014 36 5.1 0 -29,412 Lundin Mining Corporation Common Shares Lorito Holdings S.à.r.l. 3 20/11/2014 36 4E+06 3,607,844 Lundin Mining Corporation Common Shares Lorito Holdings S.à.r.l. 3 20/11/2014 36 5.1 37,557,844 3,607,844 Lundin Mining Corporation Subscription Rights Lorito Holdings S.à.r.l. 3 20/11/2014 36 5.1 0 -3,607,844 Lundin Mining Corporation Common Shares Zebra Holdings and 3 20/11/2014 36 5.1 54,964,854 16,000,000 Investments S.à.r.l. Lundin Mining Corporation Subscription Rights Zebra Holdings and 3 20/11/2014 36 5.1 0 -16,000,000 Investments S.à.r.l. Macarthur Minerals Limited Common Shares Inwentash, Sheldon 6 17/11/2014 10 0.14 9,264,000 14,000 Macarthur Minerals Limited Common Shares Pinetree Capital Ltd. 3 17/11/2014 10 0.14 9,264,000 14,000 Magellan Aerospace Common Shares Hahnelt, Konrad 5 17/11/2014 10 14.1 65,096 -1,300 Corporation Magellan Aerospace Common Shares Hahnelt, Konrad 5 18/11/2014 10 14.15 64,596 -500 Corporation Magellan Aerospace Common Shares Hahnelt, Konrad 5 18/11/2014 10 14.2 64,096 -500 Corporation Magellan Aerospace Common Shares Hahnelt, Konrad 5 18/11/2014 10 14.25 63,596 -500 Corporation Magellan Aerospace Common Shares Hahnelt, Konrad 5 20/11/2014 10 14.25 63,096 -500 Corporation Manitex Capital Inc. Common Shares Perry, Ronald S. 4, 6 19/11/2014 10 0.415 20,835 -165 Manitok Energy Inc. Common Shares Geremia, Bruno P. 4 19/11/2014 10 1.46 550,200 2,000 Manitok Energy Inc. Common Shares Geremia, Bruno P. 4 20/11/2014 10 1.44 552,200 2,000 Manitou Gold Inc. Common Shares Tracanelli, Harold Joseph 4, 5 13/11/2014 00 Maple Leaf Foods Inc. Common Shares McAlpine, Rory A. 5 08/09/2014 30 20.07 26,624 107 Maple Leaf Foods Inc. Common Shares Vels, Michael Harold 5 14/11/2014 10 19.41 23,133 -100 Maple Leaf Foods Inc. Common Shares Vels, Michael Harold 5 17/11/2014 10 19.49 13,233 -9,900 Maple Leaf Royalties Corp. Common Shares Cartwright, Robert Hugh 4 14/11/2014 37 350,000 -1,050,000 Maple Leaf Royalties Corp. Common Shares Cartwright, Robert Hugh 4 14/11/2014 16 0.3077 759,500 409,500 Maple Leaf Royalties Corp. Common Shares Cartwright, Robert Hugh 4 14/11/2014 36 0.3077 796,940 37,440 Maple Leaf Royalties Corp. Options Cartwright, Robert Hugh 4 14/11/2014 37 6,667 -20,000 Maple Leaf Royalties Corp. Warrants Cartwright, Robert Hugh 4 14/03/2013 00 Maple Leaf Royalties Corp. Warrants Cartwright, Robert Hugh 4 14/11/2014 16 409,500 409,500 Maple Leaf Royalties Corp. Common Shares Cheyne, Martin James 4 14/11/2014 00 325,000 Maple Leaf Royalties Corp. Warrants Cheyne, Martin James 4 14/11/2014 00 325,000 Maple Leaf Royalties Corp. Common Shares Dickson, John 5 14/11/2014 37 50,000 -150,000 Maple Leaf Royalties Corp. Options Dickson, John 5 14/11/2014 37 10,000 -30,000 Maple Leaf Royalties Corp. Common Shares Doyle, Shane William 4 14/11/2014 37 281,250 -843,750 Maple Leaf Royalties Corp. Common Shares Doyle, Shane William 4 14/11/2014 16 0.3077 363,150 81,900 Maple Leaf Royalties Corp. Common Shares Doyle, Shane William 4 14/11/2014 36 0.3077 400,590 37,440 Maple Leaf Royalties Corp. Common Shares Doyle, Shane William 4 14/03/2013 00 Maple Leaf Royalties Corp. Common Shares Doyle, Shane William 4 14/11/2014 16 0.3077 224,640 224,640 Maple Leaf Royalties Corp. Common Shares Doyle, Shane William 4 14/03/2013 00 Maple Leaf Royalties Corp. Common Shares Doyle, Shane William 4 14/11/2014 16 0.3077 100,620 100,620 Maple Leaf Royalties Corp. Options Doyle, Shane William 4 14/11/2014 37 6,667 -20,000 Maple Leaf Royalties Corp. Warrants Doyle, Shane William 4 14/03/2013 00 Maple Leaf Royalties Corp. Warrants Doyle, Shane William 4 14/11/2014 16 81,900 81,900 Maple Leaf Royalties Corp. Warrants Doyle, Shane William 4 14/03/2013 00 Maple Leaf Royalties Corp. Warrants Doyle, Shane William 4 14/11/2014 16 224,640 224,640 Maple Leaf Royalties Corp. Warrants Doyle, Shane William 4 14/03/2013 00 Maple Leaf Royalties Corp. Warrants Doyle, Shane William 4 14/11/2014 16 100,620 100,620
November 27, 2014 (2014), 37 OSCB 10618
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Maple Leaf Royalties Corp. Common Shares Gundersen, Daniel Olaf 3, 4, 5 14/11/2014 00 1,392,561 Maple Leaf Royalties Corp. Warrants Gundersen, Daniel Olaf 3, 4, 5 14/11/2014 00 1,137,501 Maple Leaf Royalties Corp. Common Shares Jackson, Lowell Edward 4 14/11/2014 00 650,001 Maple Leaf Royalties Corp. Warrants Jackson, Lowell Edward 4 14/11/2014 00 650,001 Maple Leaf Royalties Corp. Common Shares Thomas, Adam Arthur 5 14/11/2014 00 255,060 Charles Maple Leaf Royalties Corp. Common Shares Thomas, Adam Arthur 5 14/11/2014 00 731,250 Charles Maple Leaf Royalties Corp. Warrants Thomas, Adam Arthur 5 14/11/2014 00 731,250 Charles Maple Leaf Royalties Corp. Common Shares Zahary, John 4 14/11/2014 00 325,000 Maple Leaf Royalties Corp. Warrants Zahary, John 4 14/11/2014 00 325,000 Maplewood International Options Kacira, Orhan 3, 4, 5 12/11/2014 51 0.8 223,125 -30,000 Real Estate Investment Trust Maplewood International Trust Units Kacira, Orhan 3, 4, 5 21/11/2014 51 0.8 42,000 30,000 Real Estate Investment Trust Martinrea International Inc. Common Shares Rashid, David 5 19/06/2014 00 5,000 Mason Graphite Inc. Common Shares Marcotte, Simon 5 17/11/2014 10 0.493 1,132,000 10,000 (formerly, POCML 1 INC.) Mason Graphite Inc. Common Shares Marcotte, Simon 5 17/11/2014 10 0.504 1,142,000 10,000 (formerly, POCML 1 INC.) Mason Graphite Inc. Common Shares Marcotte, Simon 5 18/11/2014 10 0.495 1,147,000 5,000 (formerly, POCML 1 INC.) Mason Graphite Inc. Common Shares Marcotte, Simon 5 18/11/2014 10 0.55 1,148,000 1,000 (formerly, POCML 1 INC.) Mason Graphite Inc. Common Shares Marcotte, Simon 5 19/11/2014 10 0.56 1,153,000 5,000 (formerly, POCML 1 INC.) Matica Enterprises Inc. Common Shares Tong, Richard 5 14/11/2014 10 0.15 1,340,000 -30,000 Matrix Asset Management Restricted Shares Rautava, Tony Antero 7, 5 13/11/2014 30 31,455 -10,000 Inc. Matrix Asset Management Vested Restricted Shares Rautava, Tony Antero 7, 5 13/11/2014 30 22,908 10,000 Inc. MAYA GOLD & SILVER INC. Common Shares Goulet, Guy 4, 5 18/11/2014 10 0.24 1,093,796 1,500 MBAC Fertilizer Corp. Common Shares Arsenault, Denis 4 14/11/2014 10 0 -101,916 MBAC Fertilizer Corp. Warrants Arsenault, Denis 4 14/11/2014 10 0 -71,500 MBAC Fertilizer Corp. Common Shares Davidson, Alexander John 4 17/11/2014 10 0.085 177,666 -214,000 MBAC Fertilizer Corp. Warrants Davidson, Alexander John 4 24/12/2009 00 100,000 MBAC Fertilizer Corp. Warrants Davidson, Alexander John 4 17/11/2014 10 0.025 -30,000 MBAC Fertilizer Corp. Warrants Davidson, Alexander John 4 17/11/2014 10 0.025 97,000 -3,000 MBAC Fertilizer Corp. Warrants Davidson, Alexander John 4 17/11/2014 10 0.02 0 -97,000 MBN Corporation Units MBN Corporation 1 14/11/2014 38 5.19 1,000 1,000 MBN Corporation Units MBN Corporation 1 14/11/2014 38 0 -1,000 MBN Corporation Units MBN Corporation 1 17/11/2014 38 5.15 100 100 MBN Corporation Units MBN Corporation 1 17/11/2014 38 0 -100 MCAN Mortgage Corporation Common Shares Doré, Susan 4 17/11/2014 10 14.55 78,600 1,500 MCAN Mortgage Corporation Common Shares Doré, Susan 4 18/11/2014 10 14.578 80,600 2,000 MCAN Mortgage Corporation Common Shares Doré, Susan 4 19/11/2014 10 14.566 82,600 2,000 MCAN Mortgage Corporation Common Shares Doré, Susan 4 20/11/2014 10 14.437 84,600 2,000 MCAN Mortgage Corporation Common Shares Doré, Susan 4 20/11/2014 10 14.4 85,400 800 MCAN Mortgage Corporation Common Shares Doré, Susan 4 21/11/2014 10 14.433 87,400 2,000 McCoy Global Inc. Common Shares McDonald, Ian Cody 5 17/11/2014 51 3.49 7,017 3,333 McCoy Global Inc. Options McDonald, Ian Cody 5 17/11/2014 51 3.49 6,667 -3,333 McCoy Global Inc. Options McDonald, Ian Cody 5 17/11/2014 52 0 -6,667 McCoy Global Inc. Common Shares Watts, Thomas Alan 5 18/11/2014 10 3.2 23,554 10,000 McCoy Global Inc. Common Shares Watts, Thomas Alan 5 18/11/2014 10 4.85 13,554 -10,000 McCoy Global Inc. Common Shares Watts, Thomas Alan 5 18/11/2014 10 3.49 30,221 16,667 McCoy Global Inc. Common Shares Watts, Thomas Alan 5 18/11/2014 10 4.85 13,554 -16,667 McCoy Global Inc. Options Watts, Thomas Alan 5 18/11/2014 51 3.2 133,334 -10,000 McCoy Global Inc. Options Watts, Thomas Alan 5 18/11/2014 51 3.49 116,667 -16,667 Mediagrif Interactive Common Shares Les Services de gestion 3 17/11/2014 10 18 2,752,300 1,000 Technologies Inc. Claude Roy Inc.
November 27, 2014 (2014), 37 OSCB 10619
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Mediagrif Interactive Common Shares Les Services de gestion 3 19/11/2014 10 18 2,753,300 1,000 Technologies Inc. Claude Roy Inc. Mediagrif Interactive Common Shares Roy, Claude 3, 4, 5 17/11/2014 10 18 2,752,300 1,000 Technologies Inc. Mediagrif Interactive Common Shares Roy, Claude 3, 4, 5 19/11/2014 10 18 2,753,300 1,000 Technologies Inc. Mega Precious Metals Inc. Common Shares Inwentash, Sheldon 6 18/11/2014 10 0.08 23,750,000 500,000 Mega Precious Metals Inc. Common Shares Pinetree Capital Ltd. 3 18/11/2014 10 0.08 20,559,464 500,000 Melcor Developments Ltd. Common Shares Rudge, Jesse 5 14/11/2014 51 13.74 3,876 1,100 Melcor Developments Ltd. Common Shares Rudge, Jesse 5 14/11/2014 10 23.75 2,776 -1,100 Melcor Developments Ltd. Options Rudge, Jesse 5 14/11/2014 51 13.74 23,400 -1,100 Melcor Real Estate Trust Units Roozen, Catherine M. 6 17/11/2014 10 10.2 55,700 500 Investment Trust Melcor Real Estate Trust Units Roozen, Catherine M. 6 20/11/2014 10 10.2 63,400 7,700 Investment Trust Melcor Real Estate Convertible Debentures Young, Ralph Barclay 6 01/05/2013 00 Investment Trust Melcor Real Estate Convertible Debentures Young, Ralph Barclay 6 14/11/2014 15 $25,000 $25,000 Investment Trust Metallum Resources Inc. Options Megann, Harold James 4 28/08/2013 00 (formerly Young-Shannon (Jim) Gold Mines, Limited) Metallum Resources Inc. Warrants Megann, Harold James 4 28/08/2013 00 (formerly Young-Shannon (Jim) Gold Mines, Limited) Metanor Resources Inc. Options Morin, Ghislain 4, 5 21/01/2014 52 2,490,000 -300,000 Metanor Resources Inc. Options Roy, Serge 4, 5 21/01/2014 52 2,490,000 -140,000 Metro inc. Common Shares GIROUX, Marc 5 21/11/2014 51 34.97 6,256 4,560 Metro inc. Common Shares GIROUX, Marc 5 21/11/2014 51 44.19 8,956 2,700 Metro inc. Common Shares GIROUX, Marc 5 21/11/2014 51 47.14 10,636 1,680 Metro inc. Common Shares GIROUX, Marc 5 21/11/2014 51 45.26 12,636 2,000 Metro inc. Common Shares GIROUX, Marc 5 21/11/2014 51 53.15 13,676 1,040 Metro inc. Common Shares GIROUX, Marc 5 21/11/2014 51 58.41 14,276 600 Metro inc. Common Shares GIROUX, Marc 5 21/11/2014 10 85.957 9,276 -5,000 Metro inc. Common Shares GIROUX, Marc 5 21/11/2014 10 86.385 4,276 -5,000 Metro inc. Common Shares GIROUX, Marc 5 21/11/2014 10 86.9 1,696 -2,580 Metro inc. Options GIROUX, Marc 5 21/11/2014 51 34.97 31,340 -4,560 Metro inc. Options GIROUX, Marc 5 21/11/2014 51 44.19 28,640 -2,700 Metro inc. Options GIROUX, Marc 5 21/11/2014 51 47.14 26,960 -1,680 Metro inc. Options GIROUX, Marc 5 21/11/2014 51 45.26 24,960 -2,000 Metro inc. Options GIROUX, Marc 5 21/11/2014 51 53.15 23,920 -1,040 Metro inc. Options GIROUX, Marc 5 21/11/2014 51 58.41 23,320 -600 Metro inc. Common Shares Vézina, Yves 5 21/11/2014 51 24.73 2,545 420 Metro inc. Common Shares Vézina, Yves 5 21/11/2014 51 29.63 2,905 360 Metro inc. Common Shares Vézina, Yves 5 21/11/2014 51 37.5 3,585 680 Metro inc. Common Shares Vézina, Yves 5 21/11/2014 51 44.19 4,945 1,360 Metro inc. Options Vézina, Yves 5 21/11/2014 51 24.73 23,720 -420 Metro inc. Options Vézina, Yves 5 21/11/2014 51 29.63 23,360 -360 Metro inc. Options Vézina, Yves 5 21/11/2014 51 37.5 22,680 -680 Metro inc. Options Vézina, Yves 5 21/11/2014 51 44.19 21,320 -1,360 Midas Gold Corp. Common Shares Allred, Keith 4 12/11/2014 00 Midas Gold Corp. Common Shares Brunk, Kenneth,Arnold 4 12/11/2014 00 100,000 Midas Gold Corp. Common Shares Davenport, Scott Kevan 4 12/11/2014 00 200 Midas Gold Corp. Options Julian, Ronnie F. 7 12/11/2014 00 4,000 Midas Gold Corp. Common Shares Sayer, Laurel 4 15/11/2014 00 Middlefield Can-Global REIT Trust Units Middlefield Can-Global 1 19/11/2014 38 10.625 2,138,645 1,600 Income Fund REIT Income Fund Middlefield Can-Global REIT Trust Units Middlefield Can-Global 1 20/11/2014 38 10.59 2,139,445 800 Income Fund REIT Income Fund Migao Corporation Common Shares Smallbone, Sidney Randall 5 02/06/2008 00 Migao Corporation Common Shares Smallbone, Sidney Randall 5 08/06/2008 00 Migao Corporation Options Smallbone, Sidney Randall 5 02/06/2008 00
November 27, 2014 (2014), 37 OSCB 10620
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Migao Corporation Options Smallbone, Sidney Randall 5 08/06/2008 00 300,000 Minera Alamos Inc. Common Shares Frostad, Christopher John 4, 5 17/11/2014 10 0.22 75,783 500 Minnova Corp. (formerly Common Shares Glenn, Gorden 4 18/11/2014 10 0.3 68,500 1,500 Auriga Gold Corp.) Minnova Corp. (formerly Common Shares Glenn, Gorden 4 21/11/2014 10 0.345 73,500 5,000 Auriga Gold Corp.) Minsud Resources Corp. Options Andersen, Paul Forbes 5 20/11/2014 50 0.1 375,000 50,000 (previously, Rattlesnake Ventures Inc.) MINT Income Fund Trust Units MINT Income Fund 1 19/11/2014 10 10.1 46,937,798 -9,000 Mistango River Resources Common Shares Investec Bank Plc 3 13/11/2014 10 0.0599 1,000,000 -58,359 Inc. Mistango River Resources Common Shares Investec Bank Plc 3 18/11/2014 10 0.0599 996,000 -4,000 Inc. Monarques Resources Inc. Common Shares Janelle, Vincent 5 20/11/2014 10 0.13 97,000 6,000 Monarques Resources Inc. Common Shares Lacoste, Jean-Marc 4, 5 18/11/2014 10 0.13 3,080,000 10,000 Monarques Resources Inc. Common Shares Lacoste, Jean-Marc 4, 5 19/11/2014 10 0.13 3,090,000 10,000 MONETA PORCUPINE Options Wayne, Mark 4 13/11/2014 50 0.06 500,000 200,000 MINES INC. Montana Gold Mining Common Shares Plexman, Eric 4, 5 18/11/2014 10 0.05 2,171,230 10,000 Company Inc. Mood Media Corporation Common Shares Richards, David V. 4 20/11/2014 10 0.44 50,000 20,000 (formerly Fluid Music Canada, Inc.) Murchison Minerals Ltd. Common Shares Johnson, Donald Kenneth 3, 4 18/11/2014 16 0.03 38,548,278 20,000,000 Murchison Minerals Ltd. Common Shares Johnson, Donald Kenneth 3, 4 18/11/2014 16 0.03 3,666,667 3,666,667 Murchison Minerals Ltd. Warrants Johnson, Donald Kenneth 3, 4 18/11/2014 16 0.05 35,625,000 20,000,000 Murchison Minerals Ltd. Common Shares Potvin, Jean-Charles 4, 5 18/11/2014 11 0.03 8,035,101 333,500 Murchison Minerals Ltd. Common Shares Pyper, David James 4 18/11/2014 11 0.03 1,100,000 500,000 Namibia Rare Earths Inc. Common Shares McConnell, Gerald James 4, 5 14/11/2014 10 0.192 1,985,000 50,000 National Bank of Canada Common Shares Bachand, Raymond 4 29/10/2014 00 National Bank of Canada Common Shares Bachand, Raymond 4 14/11/2014 10 54.545 71 71 National Bank of Canada Unités d'actions différées Bachand, Raymond 4 29/10/2014 00 (UAD) / (DSU) National Bank of Canada Unités d'actions différées Bachand, Raymond 4 14/11/2014 56 87 87 (UAD) / (DSU) National Bank of Canada Unités d'actions Bertrand, Luc 5 03/11/2014 35 20,227 183 assujetties à des restrictions (UAR) /(RUS) National Bank of Canada Common Shares Bertrand, Maryse 4 03/11/2014 35 52.57 19 National Bank of Canada Common Shares Bertrand, Maryse 4 03/11/2014 35 52.57 19 National Bank of Canada Common Shares Bertrand, Maryse 4 03/11/2014 35 52.57 3,568 19 National Bank of Canada Common Shares Bertrand, Maryse 4 14/11/2014 35 54.545 194 National Bank of Canada Common Shares Bertrand, Maryse 4 14/11/2014 35 54.545 194 National Bank of Canada Common Shares Bertrand, Maryse 4 14/11/2014 10 54.545 194 National Bank of Canada Common Shares Bertrand, Maryse 4 14/11/2014 10 54.545 194 National Bank of Canada Common Shares Bertrand, Maryse 4 14/11/2014 10 54.545 3,763 195 National Bank of Canada Unités d'actions différées Bertrand, Maryse 4 03/11/2014 35 -33 (UAD) / (DSU) National Bank of Canada Unités d'actions différées Bertrand, Maryse 4 03/11/2014 35 -33 (UAD) / (DSU) National Bank of Canada Unités d'actions différées Bertrand, Maryse 4 03/11/2014 35 33 (UAD) / (DSU) National Bank of Canada Unités d'actions différées Bertrand, Maryse 4 03/11/2014 35 33 (UAD) / (DSU) National Bank of Canada Unités d'actions différées Bertrand, Maryse 4 03/11/2014 35 3,742 34 (UAD) / (DSU) National Bank of Canada Unités d'actions différées Bertrand, Maryse 4 14/11/2014 56 310 (UAD) / (DSU) National Bank of Canada Unités d'actions différées Bertrand, Maryse 4 14/11/2014 56 310 (UAD) / (DSU) National Bank of Canada Unités d'actions différées Bertrand, Maryse 4 14/11/2014 56 4,051 309 (UAD) / (DSU)
November 27, 2014 (2014), 37 OSCB 10621
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed National Bank of Canada Unités d'actions Bilodeau, Stéphane 5 03/11/2014 35 15,432 139 assujetties à un critère de performance National Bank of Canada Unités d'actions différées Bilodeau, Stéphane 5 03/11/2014 35 5,737 52 (UAD) / (DSU) National Bank of Canada Common Shares Bloomberg, Lawrence S. 4, 7 14/11/2014 10 54.545 3,974 138 National Bank of Canada Common Shares Boivin, Pierre 4 03/11/2014 35 52.57 13,168 11 National Bank of Canada Common Shares Boivin, Pierre 4 14/11/2014 10 54.545 13,363 195 National Bank of Canada Unités d'actions Bonnell, William 5 03/11/2014 35 2,217 20 assujetties à des restrictions (UAR) /(RUS) National Bank of Canada Unités d'actions Bonnell, William 5 03/11/2014 35 20,577 186 assujetties à un critère de performance National Bank of Canada Unités d'actions différées Bonnell, William 5 03/11/2014 35 13,222 119 (UAD) / (DSU) National Bank of Canada Common Shares Caillé, André 4 03/11/2014 35 52.57 11,409 103 National Bank of Canada Common Shares Caillé, André 4 14/11/2014 10 54.545 11,643 234 National Bank of Canada Unités d'actions différées Caillé, André 4 03/11/2014 35 29,712 268 (UAD) / (DSU) National Bank of Canada Unités d'actions différées Caillé, André 4 14/11/2014 56 30,124 412 (UAD) / (DSU) National Bank of Canada Common Shares Coulombe, Gérard 4 03/11/2014 35 52.57 16,053 81 National Bank of Canada Common Shares Coulombe, Gérard 4 14/11/2014 10 54.545 16,237 184 National Bank of Canada Unités d'actions différées Coulombe, Gérard 4 03/11/2014 35 57,904 523 (UAD) / (DSU) National Bank of Canada Unités d'actions différées Coulombe, Gérard 4 03/11/2014 35 523 (UAD) / (DSU) National Bank of Canada Unités d'actions différées Coulombe, Gérard 4 03/11/2014 35 523 (UAD) / (DSU) National Bank of Canada Unités d'actions différées Coulombe, Gérard 4 14/11/2014 56 58,050 146 (UAD) / (DSU) National Bank of Canada Unités d'actions différées Dagenais, Jean 5 03/11/2014 35 13,267 120 (UAD) / (DSU) National Bank of Canada Unités d'actions Davis, Brian A. 7 03/11/2014 35 112,138 1,013 assujetties à des restrictions (UAR) /(RUS) National Bank of Canada Common Shares Denham, Gillian H. (Jill) 4 14/11/2014 10 54.545 12,624 157 National Bank of Canada Unités d'actions différées Denham, Gillian H. (Jill) 4 03/11/2014 35 133 1 (UAD) / (DSU) National Bank of Canada Unités d'actions Fagnoule, Dominique 5 03/11/2014 35 1,736 16 assujetties à des restrictions (UAR) /(RUS) National Bank of Canada Unités d'actions Fagnoule, Dominique 5 03/11/2014 35 8,681 78 assujetties à un critère de performance National Bank of Canada Unités d'actions différées Fagnoule, Dominique 5 03/11/2014 35 4,340 39 (UAD) / (DSU) National Bank of Canada Common Shares Fortin, Richard 4 14/11/2014 10 54.545 4,796 217 National Bank of Canada Common Shares Fortin, Richard 4 14/11/2014 10 54.545 4,880 84 National Bank of Canada Unités d'actions différées Fortin, Richard 4 03/11/2014 35 1,661 15 (UAD) / (DSU) National Bank of Canada Unités d'actions différées Fortin, Richard 4 14/11/2014 56 2,050 389 (UAD) / (DSU) National Bank of Canada Unités d'actions Giard, Diane 5 03/11/2014 35 11,601 105 assujetties à des restrictions (UAR) /(RUS) National Bank of Canada Unités d'actions Giard, Diane 5 03/11/2014 35 64,923 587 assujetties à un critère de performance National Bank of Canada Unités d'actions différées Giard, Diane 5 03/11/2014 35 18,259 164 (UAD) / (DSU) National Bank of Canada Unités d'actions Girard, Eric 5 03/11/2014 35 83,351 753 assujetties à des restrictions (UAR) /(RUS) National Bank of Canada Unités d'actions différées Hanczakowski, Jean- 5 03/11/2014 35 4,740 43 (UAD) / (DSU) François
November 27, 2014 (2014), 37 OSCB 10622
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed National Bank of Canada Common Shares Houde, Jean 4 03/11/2014 35 52.57 13,380 25 National Bank of Canada Common Shares Houde, Jean 4 14/11/2014 10 54.545 13,508 128 National Bank of Canada Unités d'actions Jeanniot, Lynn 5 03/11/2014 35 31,720 286 assujetties à un critère de performance National Bank of Canada Unités d'actions différées Jeanniot, Lynn 5 03/11/2014 35 5,787 52 (UAD) / (DSU) National Bank of Canada Common Shares Laflamme, Louise 4 14/11/2014 10 54.545 17,210 202 National Bank of Canada Unités d'actions différées Laflamme, Louise 4 03/11/2014 35 10,755 97 (UAD) / (DSU) National Bank of Canada Unités d'actions différées Laflamme, Louise 4 14/11/2014 56 11,076 321 (UAD) / (DSU) National Bank of Canada Unités d'actions Leggett, Karen 5 03/11/2014 35 11,589 106 assujetties à des restrictions (UAR) /(RUS) National Bank of Canada Unités d'actions Leggett, Karen 5 03/11/2014 35 15,432 139 assujetties à un critère de performance National Bank of Canada Unités d'actions différées Leggett, Karen 5 03/11/2014 35 7,730 70 (UAD) / (DSU) National Bank of Canada Unités d'actions différées Legris, Alain 5 03/11/2014 35 16,305 148 (UAD) / (DSU) National Bank of Canada Unités d'actions différées Marchand, Elaine 5 03/11/2014 35 958 9 (UAD) / (DSU) National Bank of Canada Unités d'actions Paiement, Luc 5 03/11/2014 35 90,403 816 assujetties à un critère de performance National Bank of Canada Unités d'actions différées Paiement, Luc 5 03/11/2014 35 53,930 487 (UAD) / (DSU) National Bank of Canada Unités d'actions Parent, Ghislain 5 03/11/2014 35 33,835 306 assujetties à un critère de performance National Bank of Canada Unités d'actions différées Parent, Ghislain 5 03/11/2014 35 22,781 205 (UAD) / (DSU) National Bank of Canada Unités d'actions Pascoe, Ricardo 5 03/11/2014 35 106,940 965 assujetties à des restrictions (UAR) /(RUS) National Bank of Canada Unités d'actions Pascoe, Ricardo 5 03/11/2014 35 85,645 773 assujetties à un critère de performance National Bank of Canada Common Shares Payette, Julie 4 03/11/2014 35 52.57 250 2 National Bank of Canada Common Shares Payette, Julie 4 14/11/2014 10 54.545 404 154 National Bank of Canada Unités d'actions différées Payette, Julie 4 03/11/2014 35 315 3 (UAD) / (DSU) National Bank of Canada Unités d'actions différées Payette, Julie 4 14/11/2014 56 521 206 (UAD) / (DSU) National Bank of Canada Common Shares Runte, Roseann 4 03/11/2014 35 52.57 13,622 86 National Bank of Canada Common Shares Runte, Roseann 4 14/11/2014 10 54.545 13,772 150 National Bank of Canada Unités d'actions différées Runte, Roseann 4 03/11/2014 35 36,444 329 (UAD) / (DSU) National Bank of Canada Unités d'actions différées Runte, Roseann 4 14/11/2014 56 36,696 252 (UAD) / (DSU) National Bank of Canada Common Shares Saputo, Lino Anthony 4 03/11/2014 35 52.57 4,214 20 National Bank of Canada Common Shares Saputo, Lino Anthony 4 14/11/2014 10 54.545 4,381 167 National Bank of Canada Unités d'actions différées Saputo, Lino Anthony 4 03/11/2014 35 3,303 30 (UAD) / (DSU) National Bank of Canada Unités d'actions différées Saputo, Lino Anthony 4 14/11/2014 56 3,555 252 (UAD) / (DSU) National Bank of Canada Common Shares Thabet, Pierre 4 03/11/2014 35 52.57 2,829 26 National Bank of Canada Common Shares Thabet, Pierre 4 14/11/2014 10 54.545 3,005 176 National Bank of Canada Unités d'actions différées Thabet, Pierre 4 03/11/2014 35 4,757 43 (UAD) / (DSU) National Bank of Canada Unités d'actions différées Thabet, Pierre 4 14/11/2014 56 5,020 263 (UAD) / (DSU) National Bank of Canada Unités d'actions Vachon, Louis 4, 5 01/05/2014 35 2,075 assujetties à un critère de performance
November 27, 2014 (2014), 37 OSCB 10623
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed National Bank of Canada Unités d'actions Vachon, Louis 4, 5 01/05/2014 35 2,075 assujetties à un critère de performance National Bank of Canada Unités d'actions Vachon, Louis 4, 5 01/05/2014 35 2,075 assujetties à un critère de performance National Bank of Canada Unités d'actions Vachon, Louis 4, 5 01/08/2014 35 2,061 assujetties à un critère de performance National Bank of Canada Unités d'actions Vachon, Louis 4, 5 01/08/2014 35 2,061 assujetties à un critère de performance National Bank of Canada Unités d'actions Vachon, Louis 4, 5 01/08/2014 35 2,061 assujetties à un critère de performance National Bank of Canada Unités d'actions Vachon, Louis 4, 5 03/11/2014 35 211,470 1,909 assujetties à un critère de performance Nemaska Lithium Inc. Common Shares Bourassa, guy georges 4, 5 17/11/2014 10 0.145 2,962,000 7,000 Nevada Sunrise Gold Common Shares Petterson, Brent 5 18/11/2014 10 0.5 59,000 -4,000 Corporation Newalta Corporation Common Shares Pardo, Felix 7 14/11/2014 10 18.73 4,000 -2,000 Newalta Corporation Common Shares Pardo, Felix 7 20/11/2014 10 19.08 3,000 -1,000 Newnote Financial Corp. Common Shares Gusko, Brian 4 06/11/2014 10 0.3 155,000 -6,000 NexGen Energy Ltd. Common Shares Inwentash, Sheldon 6 14/11/2014 10 0.4515 9,500,000 75,000 Nexus Gold Corp. Common Shares Berdusco, Peter Dean 4, 7, 5 14/11/2014 10 0.07 1,963,884 -10,000 Nexus Gold Corp. Common Shares Berdusco, Peter Dean 4, 7, 5 14/11/2014 16 0.1 2,068,884 105,000 Nexus Gold Corp. Common Shares Berdusco, Peter Dean 4, 7, 5 17/11/2014 10 0.07 2,008,884 -60,000 Nexus Gold Corp. Warrants Berdusco, Peter Dean 4, 7, 5 31/07/2014 99 0 -947,470 Nexus Gold Corp. Warrants Berdusco, Peter Dean 4, 7, 5 31/07/2014 00 Nexus Gold Corp. Warrants Berdusco, Peter Dean 4, 7, 5 31/07/2014 99 947,470 947,470 Nexus Gold Corp. Warrants Berdusco, Peter Dean 4, 7, 5 14/11/2014 53 1,052,470 105,000 Nexus Gold Corp. Common Shares Klenman, Alexander 4 12/11/2014 16 0.1 95,000 Nexus Gold Corp. Common Shares Klenman, Alexander 4 12/11/2014 16 0.1 95,000 Nexus Gold Corp. Warrants Klenman, Alexander 4 31/07/2014 00 Nexus Gold Corp. Warrants Klenman, Alexander 4 18/11/2014 16 0.1 95,000 95,000 NGEx Resources Inc. Common Shares Carmichael, Robert Gordon 5 14/11/2014 10 1.26 20,100 100 NGEx Resources Inc. Common Shares Carmichael, Robert Gordon 5 17/11/2014 10 1.3 24,300 4,200 NGEx Resources Inc. Common Shares Carmichael, Robert Gordon 5 18/11/2014 10 1.3 30,000 5,700 NGEx Resources Inc. Options Carmichael, Robert Gordon 5 14/11/2014 52 355,000 -50,000 NGEx Resources Inc. Options Conibear, Paul K. 4 18/11/2014 52 2.83 450,000 -100,000 NGEx Resources Inc. Options Mir, Pablo 7 14/11/2014 52 2.83 112,500 -15,000 NGEx Resources Inc. Common Shares Rand, William Archibald 4 21/11/2014 51 0.7 394,098 100,000 NGEx Resources Inc. Options Rand, William Archibald 4 14/11/2014 52 2083 -100,000 NGEx Resources Inc. Options Rand, William Archibald 4 14/11/2014 52 2.83 450,000 -100,000 NGEx Resources Inc. Options Rand, William Archibald 4 21/11/2014 51 0.7 350,000 -100,000 NGEx Resources Inc. Options Vitaller, Alfredo Omar 2 14/11/2014 52 2.83 450,000 -50,000 Niko Resources Ltd. Common Shares Disbrow, Robert 3 18/11/2014 10 0.27 5,931,050 6,000 Niko Resources Ltd. Common Shares Disbrow, Robert 3 19/11/2014 10 0.27 6,090,550 159,500 Niko Resources Ltd. Common Shares Disbrow, Robert 3 20/11/2014 10 0.2784 6,150,050 59,500 Niko Resources Ltd. Common Shares Disbrow, Robert 3 14/11/2014 10 0.285 4,921,500 50,000 Niko Resources Ltd. Common Shares Disbrow, Robert 3 19/11/2014 10 0.27 5,021,500 100,000 Niko Resources Ltd. Common Shares Disbrow, Robert 3 20/11/2014 10 0.28 5,071,500 50,000 Niko Resources Ltd. Convertible Notes Disbrow, Robert 3 14/11/2014 10 15 $6,075,000 $250,000 (convertible for common shares) Niko Resources Ltd. Convertible Notes Disbrow, Robert 3 18/11/2014 10 15 $6,300,000 $225,000 (convertible for common shares) Niko Resources Ltd. Convertible Notes Disbrow, Robert 3 19/11/2014 10 15 $6,325,000 $25,000 (convertible for common shares) Noble Iron Inc. Options Palmer, William 4 14/10/2014 50 1 30,000
November 27, 2014 (2014), 37 OSCB 10624
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Noble Iron Inc. Options Palmer, William 4 24/10/2014 50 1 61,000 30,000 North American Energy Common Shares Ferron, Martin Robert 4, 5 14/11/2014 10 5.93 962,188 3,000 Partners Inc. North Sea Energy Inc. Common Shares Anderson, James Craig 4, 5 13/11/2014 10 0.09 3,991,718 10,000 (formerly, Ranger Energy Ltd.) Northern Blizzard Resources Common Shares NGP IX Northern Blizzard 3 17/11/2014 35 40,800,071 206,020 Inc. S.A. R.L. Northern Blizzard Resources Common Shares R/C Canada Cooperatief 3 17/11/2014 35 27,709,743 139,920 Inc. U.A. Northern Superior Resources Options Booth, Brian 4 11/11/2014 50 0.05 575,000 100,000 Inc. Northern Superior Resources Options Booth, Brian 4 18/11/2014 52 0.12 500,000 -75,000 Inc. Northern Superior Resources Options MOON, ALAN CLIFFORD 4, 5 10/11/2014 50 0.05 708,400 100,000 Inc. Northern Superior Resources Options MOON, ALAN CLIFFORD 4, 5 16/11/2014 52 0.12 75,000 Inc. Northern Superior Resources Options MOON, ALAN CLIFFORD 4, 5 16/11/2014 52 0.12 633,400 -75,000 Inc. Northern Superior Resources Options Morris, Thomas, Findlay 5 22/11/2014 52 0.12 4,533,334 466,667 Inc. NUVISTA ENERGY LTD. Options Andreachuk, Ross Lloyd 5 14/11/2014 52 11.14 301,572 -7,667 NUVISTA ENERGY LTD. Options Asman, Kevin Garth 5 14/11/2014 52 11.14 290,072 -5,667 NUVISTA ENERGY LTD. Options Asman, Kevin Garth 5 17/11/2014 59 10.31 286,072 -4,000 NUVISTA ENERGY LTD. Options Burton, Craig 5 14/11/2014 52 11.14 245,481 -6,700 NUVISTA ENERGY LTD. Options McDavid, Douglas 5 14/11/2014 52 11.14 353,481 -9,000 Christopher NUVISTA ENERGY LTD. Options McDavid, Douglas 5 17/11/2014 59 10.41 353,181 -300 Christopher NUVISTA ENERGY LTD. Options Wright, Jonathan Andrew 5 14/11/2014 59 10.25 933,579 -24,333 Nuvo Research Inc. Common Shares Stanley, Theodore H. 4 18/11/2014 10 6.9 80,973 2,000 Nuvo Research Inc. Common Shares Stanley, Theodore H. 4 18/11/2014 10 6.87 18,904 1,000 Oban Mining Corporation Common Shares Zaritsky, Blair David 5 18/11/2014 10 0.07 126,272 40,000 (formerly Braeval Mining Corporation) Oceanus Resources Common Shares Holmes, Glenn 4, 5 19/11/2014 10 0.35 1,410,757 2,500 Corporation Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 27/06/2003 00 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 31/05/2010 10 34 150 150 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 03/06/2010 10 33.6 300 150 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 08/06/2010 10 33.75 400 100 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 05/07/2010 10 33 500 100 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 27/07/2010 10 33.75 560 60 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 28/07/2010 10 33.75 680 120 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 08/09/2010 10 33.5 903 223 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 04/11/2010 10 34.18 978 75 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 04/03/2011 10 43.029 1,095 117 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 07/03/2011 10 42.25 1,170 75 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 11/03/2011 10 42.75 1,200 30 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 07/05/2011 10 42.291 1,320 120 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 05/10/2011 10 40.5 1,443 123 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 05/10/2011 10 40.5 1,566 123 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 18/10/2011 10 39 1,606 40 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 14/11/2012 10 39 1,730 124 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 14/11/2012 10 39 1,855 125 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 02/12/2012 10 39.48 1,860 5 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 03/12/2012 10 39.48 2,104 244 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 21/10/2013 10 46.8 2,177 73 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 12/11/2013 10 47.5 2,206 29 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 15/11/2013 10 47.5 2,242 36 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 15/11/2013 10 47.5 2,271 29
November 27, 2014 (2014), 37 OSCB 10625
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 09/01/2014 10 41.5 2,671 400 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 09/01/2014 10 41.933 2,849 178 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 09/01/2014 10 42.131 3,272 423 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 15/01/2014 10 41.992 3,414 142 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 21/01/2014 10 41.993 3,574 160 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 07/02/2014 10 40.98 3,621 47 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 07/02/2014 10 40.98 3,659 38 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 07/02/2014 10 40.98 3,695 36 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 10/02/2014 10 40.965 3,816 121 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 13/05/2014 10 40.84 3,864 48 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 13/05/2014 10 40.84 3,908 44 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 17/05/2014 10 40.55 4,032 124 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 12/06/2014 10 39.79 4,156 124 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 16/07/2014 10 38.495 4,362 206 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 25/08/2014 10 36.24 4,417 55 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 25/08/2014 10 36.24 4,479 62 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 26/08/2014 10 35.994 4,651 172 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 05/09/2014 10 35.894 4,845 194 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 18/09/2014 10 35.881 5,071 226 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 18/11/2014 10 34.39 5,188 117 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 18/11/2014 10 34.39 5,257 69 Olympia Financial Group Inc. Common Shares Skauge, Rick 3, 4, 5 21/11/2014 10 32.084 5,474 217 Olympia Financial Group Inc. Common Shares Wilson, James Todd 7 17/11/2014 00 Olympia Financial Group Inc. Common Shares Wilson, James Todd 7 21/11/2014 10 31.9 400 400 Oncolytics Biotech Inc. Common Shares Dillahunty, Mary Ann 5 13/11/2014 10 0.6117 1,000 -1,201 ONEX CORPORATION Subordinate Voting Munk, Anthony 7 17/11/2014 11 62.06 578,950 1,625 Shares ONEX CORPORATION Subordinate Voting Munk, Anthony 7 17/11/2014 11 62.06 229,190 -1,625 Shares Opawica Explorations Inc. Common Shares Bain, Alexander 4 13/11/2014 10 0.01 298,500 -10,000 Opawica Explorations Inc. Common Shares Wong, Sandra 5 20/11/2014 10 0.005 8,334 -221,666 Open Source Health Inc. Warrants Bartholomew, Gary 4 31/01/2014 00 Open Source Health Inc. Warrants Bartholomew, Gary 4 31/01/2014 00 Open Source Health Inc. Warrants Bartholomew, Gary 4 31/01/2014 00 Open Source Health Inc. Warrants Bartholomew, Gary 4 01/10/2014 11 0.5 250,000 Open Source Health Inc. Warrants Bartholomew, Gary 4 01/10/2014 11 0.5 250,000 Open Source Health Inc. Warrants Bartholomew, Gary 4 14/11/2014 53 0.5 375,000 125,000 Open Source Health Inc. Warrants Bartholomew, Gary 4 14/11/2014 97 0.5 250,000 -125,000 Open Source Health Inc. Warrants Bartholomew, Gary 4 14/11/2014 97 0.5 175,000 -75,000 Opsens Inc. Options Sirois, Denis M. 4 16/11/2014 52 1.15 180,000 -10,000 OREX MINERALS INC. Common Shares Cope, Gary Gordon 5 14/11/2014 10 0.25 9,258,900 44,000 OREX MINERALS INC. Common Shares Cope, Gary Gordon 5 17/11/2014 10 0.25 9,264,900 6,000 OREX MINERALS INC. Common Shares Cope, Gary Gordon 5 19/11/2014 10 0.26 9,291,900 27,000 OREX MINERALS INC. Common Shares Cope, Gary Gordon 5 20/11/2014 10 0.26 9,301,900 10,000 OREX MINERALS INC. Common Shares Cope, Gary Gordon 5 20/11/2014 10 0.25 9,306,900 5,000 OREX MINERALS INC. Common Shares Cope, Gary Gordon 5 20/11/2014 10 0.26 9,308,900 2,000 Oyster Oil and Gas Ltd. Common Shares Turnbull, Gregory George 4 21/07/2014 00 Oyster Oil and Gas Ltd. Common Shares Turnbull, Gregory George 4 19/11/2014 11 0.25 100,000 Oyster Oil and Gas Ltd. Common Shares Turnbull, Gregory George 4 19/11/2014 11 0.25 100,000 Oyster Oil and Gas Ltd. Common Shares Turnbull, Gregory George 4 19/11/2014 11 0.25 1,000,000 Oyster Oil and Gas Ltd. Common Shares Turnbull, Gregory George 4 19/11/2014 11 0.25 1,000,000 Oyster Oil and Gas Ltd. Common Shares Turnbull, Gregory George 4 19/11/2014 11 0.25 1,000,000 1,000,000 Oyster Oil and Gas Ltd. Common Shares Wood, Michael Ian Thomas 3, 4, 5 19/11/2014 11 0.25 5,586,947 200,000 Pacific & Western Bank of Common Shares Ritchie, Charles Scott 4 10/11/2014 10 5.65 7,425 2,125 Canada Pacific Rubiales Energy Notes Notes Exp. 2019 Pantin, Ronald 4, 5 26/11/2013 16 99.985 $1,000,000 Corp. Pacific Rubiales Energy Notes Notes Exp. 2019 Pantin, Ronald 4, 5 26/11/2013 16 999850 $1,000,000 Corp.
November 27, 2014 (2014), 37 OSCB 10626
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Pacific Rubiales Energy Notes Notes Exp. 2019 Pantin, Ronald 4, 5 26/11/2013 16 999850 $1,000,000 Corp. Pacific Rubiales Energy Notes Notes Exp. 2019 Pantin, Ronald 4, 5 26/11/2013 16 99.985 $1,000,000 $1,000,000 Corp. Pacific Rubiales Energy Notes Notes Exp. 2019 Pantin, Ronald 4, 5 17/11/2014 10 100.75 $0 -$1,000,000 Corp. Pacific Rubiales Energy Notes Notes Exp. 2023 Pantin, Ronald 4, 5 17/11/2014 10 93.15 $0 -$1,000,000 Corp. Pacific Rubiales Energy Notes Notes Exp. 2019 Volk, Peter Joseph 5 26/11/2013 16 99.985 $100,000 Corp. Pacific Rubiales Energy Notes Notes Exp. 2019 Volk, Peter Joseph 5 26/11/2013 16 99985 $100,000 Corp. Pacific Rubiales Energy Notes Notes Exp. 2019 Volk, Peter Joseph 5 26/11/2013 16 99.985 $100,000 $100,000 Corp. Pacific Therapeutics Ltd. Common Shares Unwin, Dougas Harry 3, 4, 5 17/11/2014 10 0.04 4,987,667 20,000 Pacific Therapeutics Ltd. Common Shares Unwin, Dougas Harry 3, 4, 5 20/11/2014 10 0.04 5,007,667 20,000 Paramount Resources Ltd. Common Shares Class A Lee, Bernard K. 5 18/11/2014 10 46.25 382,322 10,000 Paramount Resources Ltd. Common Shares Class A Lee, Bernard K. 5 19/11/2014 10 45.5 392,322 10,000 Parex Resources Inc. Common Shares Larson, Barry 5 19/11/2014 51 836,425 75,000 Parex Resources Inc. Options Larson, Barry 5 19/11/2014 51 3.04 470,000 -75,000 Parex Resources Inc. Common Shares Miller, Ronald Douglas 4 19/11/2014 51 58,605 10,000 Parex Resources Inc. Common Shares Miller, Ronald Douglas 4 19/11/2014 10 9.62 48,605 -10,000 Parex Resources Inc. Options Miller, Ronald Douglas 4 19/11/2014 51 3.04 65,500 -10,000 Parex Resources Inc. Common Shares Pinsky, Kenneth George 5 17/11/2014 51 301,426 20,000 Parex Resources Inc. Common Shares Pinsky, Kenneth George 5 17/11/2014 10 9.59 291,426 -10,000 Parex Resources Inc. Common Shares Pinsky, Kenneth George 5 17/11/2014 10 9.6 281,426 -10,000 Parex Resources Inc. Options Pinsky, Kenneth George 5 17/11/2014 51 3.04 480,900 -20,000 Parkland Fuel Corporation Deferred Share Unit Plan Bechtold, John Frederick 4 14/11/2014 30 20.22 16,876 74 Parkland Fuel Corporation Deferred Share Unit Plan Colnett, Lisa 4 14/11/2014 30 20.22 3,215 14 Parkland Fuel Corporation Common Shares Cruickshank, Andrew Stuart 5 14/11/2014 30 20.22 690 2 Parkland Fuel Corporation Common Shares Cruickshank, Andrew Stuart 5 18/11/2014 51 21.61 12,110 11,420 Parkland Fuel Corporation Restricted Common Cruickshank, Andrew Stuart 5 14/11/2014 97 20.22 8,510 15 Shares Parkland Fuel Corporation Share Options Cruickshank, Andrew Stuart 5 18/11/2014 51 21.61 67,261 -11,420 Parkland Fuel Corporation Common Shares Espey, Robert Berthold 5 14/11/2014 30 20.22 95,592 3 Parkland Fuel Corporation Restricted Common Espey, Robert Berthold 5 14/11/2014 97 20.22 66,291 102 Shares Parkland Fuel Corporation Deferred Share Unit Plan Ferland, Alain 4 14/11/2014 30 20.22 16,876 74 Parkland Fuel Corporation Common Shares Fink, Bob 5 14/11/2014 30 20.22 12,367 53 Parkland Fuel Corporation Common Shares Fink, Bob 5 14/11/2014 30 20.22 1,283 6 Parkland Fuel Corporation Restricted Common Fink, Bob 5 14/11/2014 97 20.22 13,728 22 Shares Parkland Fuel Corporation Common Shares Kilty, Colin Peter 5 14/11/2014 30 20.22 5,232 22 Parkland Fuel Corporation Restricted Common Kilty, Colin Peter 5 14/11/2014 97 20.22 25,119 54 Shares Parkland Fuel Corporation Common Shares Lapensee, Paul 4 14/11/2014 30 20.22 1,407 4 Parkland Fuel Corporation Common Shares McMillan, Michael Stanley 5 14/11/2014 30 20.22 3,708 4 Howie Parkland Fuel Corporation Common Shares McMillan, Michael Stanley 5 14/11/2014 30 20.22 5,489 26 Howie Parkland Fuel Corporation Restricted Common McMillan, Michael Stanley 5 14/11/2014 97 20.22 9,012 14 Shares Howie Parkland Fuel Corporation Common Shares Pantelidis, James 4 14/11/2014 30 20.22 200,465 292 Parkland Fuel Corporation Common Shares Pantelidis, James 4 17/11/2014 30 20.22 200,649 184 Parkland Fuel Corporation Deferred Share Unit Plan Pantelidis, James 4 14/11/2014 30 20.22 55,096 239 Parkland Fuel Corporation Common Shares Rawji, Irfhan Abdulaziz 5 14/11/2014 30 20.22 3,338 13 Parkland Fuel Corporation Restricted Common Rawji, Irfhan Abdulaziz 5 14/11/2014 97 20.22 18,195 20 Shares Parkland Fuel Corporation Common Shares ROGERS, Ronald D. 4 14/11/2014 30 20.22 42,046 182 Parkland Fuel Corporation Deferred Share Unit Plan ROGERS, Ronald D. 4 14/11/2014 30 20.22 27,416 123 Parkland Fuel Corporation Common Shares Savage, Jane Elizabeth 5 14/11/2014 30 20.22 5,332 23
November 27, 2014 (2014), 37 OSCB 10627
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Parkland Fuel Corporation Restricted Common Savage, Jane Elizabeth 5 14/11/2014 97 20.22 14,228 23 Shares Parkland Fuel Corporation Common Shares Spencer, David 4 14/11/2014 30 20.22 13,305 21 Parkland Fuel Corporation Deferred Share Unit Plan Spencer, David 4 14/11/2014 30 20.22 16,950 74 Parkland Fuel Corporation Common Shares Strating, Donna Jeanne 5 14/11/2014 30 20.22 3,500 18 Parkland Fuel Corporation Restricted Common Strating, Donna Jeanne 5 14/11/2014 97 20.22 15,650 25 Shares Parlane Resource Corp. Common Shares Arca, Gary Vittorio 4 26/11/2007 00 Parlane Resource Corp. Common Shares Arca, Gary Vittorio 4 17/11/2014 10 0.015 500,000 500,000 Parlane Resource Corp. Common Shares Eadie, Robert 4, 5 18/11/2014 10 0.015 2,929,751 500,000 Partners Real Estate Units Tawse, Moray 3 10/11/2014 10 4.24 988,700 2,300 Investment Trust Partners Real Estate Units Tawse, Moray 3 10/11/2014 10 4.23 1,000,700 12,000 Investment Trust Partners Real Estate Units Tawse, Moray 3 10/11/2014 10 4.23 1,002,000 1,300 Investment Trust Partners Real Estate Units Tawse, Moray 3 10/11/2014 10 4.22 1,007,900 5,900 Investment Trust Partners Real Estate Units Tawse, Moray 3 10/11/2014 10 4.22 1,008,200 300 Investment Trust Partners Real Estate Units Tawse, Moray 3 10/11/2014 10 4.2 1,011,400 3,200 Investment Trust Partners Real Estate Units Tawse, Moray 3 12/11/2014 10 4.2 1,014,600 3,200 Investment Trust Partners Real Estate Units Tawse, Moray 3 12/11/2014 10 4.23 1,018,900 4,300 Investment Trust Partners Real Estate Units Tawse, Moray 3 12/11/2014 10 4.23 1,020,400 1,500 Investment Trust Partners Real Estate Units Tawse, Moray 3 13/11/2014 10 4.21 1,022,500 2,100 Investment Trust Partners Real Estate Units Tawse, Moray 3 13/11/2014 10 4.21 1,026,600 4,100 Investment Trust Partners Real Estate Units Tawse, Moray 3 13/11/2014 10 4.23 1,027,300 700 Investment Trust Partners Real Estate Units Tawse, Moray 3 14/11/2014 10 4.17 1,033,500 6,200 Investment Trust Partners Real Estate Units Tawse, Moray 3 18/11/2014 10 4.24 1,042,100 8,600 Investment Trust Partners Real Estate Units Tawse, Moray 3 20/11/2014 10 4.2 1,044,900 2,800 Investment Trust Pasinex Resources Limited Common Shares Joachim, Rainer 4 13/11/2014 00 1,205,000 (formerly Triple Dragon Resources Inc.) Pasinex Resources Limited Common Shares Joachim, Rainer 4 13/11/2014 00 3,060,000 (formerly Triple Dragon Resources Inc.) Pasinex Resources Limited Common Shares Olsson, Sven 4 19/11/2014 10 0.11 1,000,000 -150,000 (formerly Triple Dragon Resources Inc.) Pason Systems Inc. Common Shares Holodinsky, David 5 21/11/2014 51 60,051 43,333 Pason Systems Inc. Common Shares Holodinsky, David 5 21/11/2014 10 27.49 16,718 -43,333 Pason Systems Inc. Options Holodinsky, David 5 21/11/2014 51 160,567 -43,333 Pason Systems Inc. Common Shares Smith, Russell 5 17/11/2014 10 7,040 500 Pathfinder Income Fund Trust Units Pathfinder Convertible 1 17/11/2014 38 10.975 7,050,003 1,600 (Formerly Pathfinder Debenture Fund Convertible Debenture Fund) Pathfinder Income Fund Trust Units Pathfinder Convertible 1 19/11/2014 38 10.875 7,051,603 1,600 (Formerly Pathfinder Debenture Fund Convertible Debenture Fund) Pathfinder Income Fund Trust Units Pathfinder Convertible 1 20/11/2014 38 10.75 7,053,203 1,600 (Formerly Pathfinder Debenture Fund Convertible Debenture Fund) Pembina Pipeline Common Shares Andersen, Harold 5 17/11/2014 10 42.58 5,702 468 Corporation Pembina Pipeline Common Shares Murphy, Paul John 5 17/11/2014 10 42.3 9,157 500 Corporation
November 27, 2014 (2014), 37 OSCB 10628
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Pembina Pipeline Options Smith, Brad 5 15/10/2014 00 Corporation Pembina Pipeline Options Smith, Brad 5 15/10/2014 00 Corporation Pembina Pipeline Rights Smith, Brad 5 15/10/2014 00 5,194 Corporation Pembina Pipeline Rights Smith, Brad 5 15/10/2014 56 8,706 3,512 Corporation Penn West Petroleum Ltd. Options Dyck, David Allan 5 14/11/2014 50 4.83 250,000 250,000 Penn West Petroleum Ltd. Common Shares George, Richard Lee 4 18/11/2014 10 4.75 417,700 2,500 Penn West Petroleum Ltd. Options Sweerts, Andrew Francis 5 16/06/2014 00 Penn West Petroleum Ltd. Options Sweerts, Andrew Francis 5 14/11/2014 50 4.83 130,000 130,000 Pennine Petroleum Common Shares Gertz, Raymond H 4 18/11/2014 10 0.035 1,327,000 50,000 Corporation Pennine Petroleum Common Shares Gertz, Raymond H 4 19/11/2014 10 0.035 1,357,000 30,000 Corporation Pennine Petroleum Common Shares Saxinger, Jeffrey Walter 4 08/09/2014 53 0.05 604,608 Corporation Pennine Petroleum Common Shares Saxinger, Jeffrey Walter 4 08/09/2014 53 0.05 604,608 Corporation Pennine Petroleum Common Shares Saxinger, Jeffrey Walter 4 08/09/2014 53 0.05 604,608 Corporation Pennine Petroleum Warrants Saxinger, Jeffrey Walter 4 08/05/2008 00 Corporation Pennine Petroleum Warrants Saxinger, Jeffrey Walter 4 08/09/2014 53 604,608 Corporation Pennine Petroleum Warrants Saxinger, Jeffrey Walter 4 08/09/2014 53 604,608 604,608 Corporation People Corporation Common Shares Anderson, Scott Cameron 4 01/02/2009 00 50,000 People Corporation Common Shares Anderson, Scott Cameron 4 13/11/2014 10 2.83 60,000 10,000 People Corporation Common Shares Anderson, Scott Cameron 4 13/11/2014 10 2.82 65,000 5,000 People Corporation Common Shares Anderson, Scott Cameron 4 19/11/2014 10 2.82 67,500 2,500 People Corporation Common Shares Anderson, Scott Cameron 4 21/11/2014 10 2.8 77,500 10,000 People Corporation Common Shares Asmundson, Paul Edward 7 19/11/2014 51 0.37 321,363 41,666 People Corporation Options Asmundson, Paul Edward 7 19/11/2014 51 0.37 41,668 -41,666 People Corporation Common Shares Chwartacki, Bonnie 5 19/11/2014 51 0.64 941,741 56,666 People Corporation Common Shares Chwartacki, Bonnie 5 19/11/2014 51 0.43 1,091,741 150,000 People Corporation Options Chwartacki, Bonnie 5 19/11/2014 51 0.64 338,334 -56,666 People Corporation Options Chwartacki, Bonnie 5 19/11/2014 51 0.43 188,334 -150,000 Performance Sports Group Common Shares Anderson, Christopher 4 10/03/2011 00 Ltd. (formerly, Bauer William Performance Sports Ltd.) Performance Sports Group Common Shares Anderson, Christopher 4 10/03/2011 00 Ltd. (formerly, Bauer William Performance Sports Ltd.) Performance Sports Group Proportionate Voting Anderson, Christopher 4 10/03/2011 00 Ltd. (formerly, Bauer Shares William Performance Sports Ltd.) Performance Sports Group Proportionate Voting Anderson, Christopher 4 10/03/2011 00 Ltd. (formerly, Bauer Shares William Performance Sports Ltd.) PFB Corporation Common Shares Kernaghan, Edward James 3 18/11/2014 10 3.9 1,037,300 100 PFB Corporation Common Shares Kernaghan, Edward James 3 18/11/2014 10 4 1,049,300 12,000 PFB Corporation Common Shares Kernaghan, Edward James 3 18/11/2014 10 3.99 1,049,900 600 PFB Corporation Common Shares Kernaghan, Edward James 3 18/11/2014 10 3.98 1,050,300 400 PFB Corporation Common Shares PFB Corporation 1 18/11/2014 38 4 2,000 1,000 PFB Corporation Common Shares PFB Corporation 1 19/11/2014 38 4 3,000 1,000 PFB Corporation Common Shares PFB Corporation 1 20/11/2014 38 4 3,700 700 Phoscan Chemical Corp. Common Shares Case, Stephen Dunbar 4, 5 18/11/2014 10 0.285 3,668,395 26,500 Pilot Gold Inc. Common Shares REID, PATRICK GORDON 5 20/11/2014 10 0.83 147,500 5,000 Pine Cliff Energy Ltd. Options Barr, Kristi 5 14/11/2014 50 1.66 909,000 129,000 Pine Cliff Energy Ltd. Options Barr, Kristi 5 14/11/2014 50 1.66 1,038,000 129,000 Pine Cliff Energy Ltd. Options Barr, Kristi 5 14/11/2014 50 1.66 1,167,000 129,000
November 27, 2014 (2014), 37 OSCB 10629
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Pine Cliff Energy Ltd. Options Fink, George Frederick 3, 4, 5 14/11/2014 50 1.66 985,000 150,000 Pine Cliff Energy Ltd. Options Fink, George Frederick 3, 4, 5 14/11/2014 50 1.66 1,135,000 150,000 Pine Cliff Energy Ltd. Options Fink, George Frederick 3, 4, 5 14/11/2014 50 1.66 1,285,000 150,000 Pine Cliff Energy Ltd. Options Hodge, Philip Blake 4, 5 14/11/2014 50 1.66 1,633,333 183,333 Pine Cliff Energy Ltd. Options Hodge, Philip Blake 4, 5 14/11/2014 50 1.66 1,816,666 183,333 Pine Cliff Energy Ltd. Options Hodge, Philip Blake 4, 5 14/11/2014 50 1.66 2,000,000 183,334 Pine Cliff Energy Ltd. Options Jarock, Randy M. 4 14/11/2014 50 1.66 798,000 68,000 Pine Cliff Energy Ltd. Options Jarock, Randy M. 4 14/11/2014 50 1.66 866,000 68,000 Pine Cliff Energy Ltd. Options Jarock, Randy M. 4 14/11/2014 50 1.66 934,000 68,000 Pine Cliff Energy Ltd. Options Jonsson, Carl Roland 4 14/11/2014 50 1.66 728,000 68,000 Pine Cliff Energy Ltd. Options Jonsson, Carl Roland 4 14/11/2014 50 1.66 796,000 68,000 Pine Cliff Energy Ltd. Options Jonsson, Carl Roland 4 14/11/2014 50 1.66 864,000 68,000 Pine Cliff Energy Ltd. Options McNeill, Terry Lee 5 14/11/2014 50 1.66 639,000 129,000 Pine Cliff Energy Ltd. Options McNeill, Terry Lee 5 14/11/2014 50 1.66 139,000 Pine Cliff Energy Ltd. Options McNeill, Terry Lee 5 14/11/2014 50 1.66 768,000 129,000 Pine Cliff Energy Ltd. Options McNeill, Terry Lee 5 14/11/2014 50 1.66 139,000 Pine Cliff Energy Ltd. Options McNeill, Terry Lee 5 14/11/2014 50 1.66 897,000 129,000 Pine Cliff Energy Ltd. Options Thompson, Robb Douglas 5 14/11/2014 50 1.66 330,000 20,000 Plaza Retail REIT Trust Units Brewer, Earl 4, 5 20/11/2014 11 0 -115,333 Plaza Retail REIT Trust Units Brewer, Earl 4, 5 20/11/2014 11 188,245 63,906 Plaza Retail REIT Trust Units Brewer, Earl 4, 5 20/11/2014 11 4.05 2,188,245 2,000,000 Plaza Retail REIT Trust Units Brewer, Earl 4, 5 20/11/2014 90 4.05 4,490,581 -2,000,000 Plaza Retail REIT RSUs Cipollone, Floriana 5 17/11/2014 30 4.02 6,700 33 Plaza Retail REIT RSUs Cipollone, Floriana 5 17/11/2014 59 4.02 6,667 -33 Plaza Retail REIT RSUs Penney, Stephen 5 17/11/2014 30 4.02 4,218 18 Plaza Retail REIT RSUs Penney, Stephen 5 17/11/2014 57 4.02 4,200 -18 Plaza Retail REIT Trust Units Penney, Stephen 5 17/11/2014 57 4.02 3,616 18 Plaza Retail REIT RSUs Petrie, James M. 5 17/11/2014 30 4.02 6,700 33 Plaza Retail REIT RSUs Petrie, James M. 5 17/11/2014 59 4.02 6,667 -33 Plaza Retail REIT RSUs Salsberg, Kevin 5 17/11/2014 30 4.02 10,049 49 Plaza Retail REIT RSUs Salsberg, Kevin 5 17/11/2014 59 4.02 10,000 -49 Plaza Retail REIT RSUs Strange, Kimberly A. 5 17/11/2014 30 4.02 1,607 7 Plaza Retail REIT RSUs Strange, Kimberly A. 5 17/11/2014 57 4.02 1,600 -7 Plaza Retail REIT Trust Units Strange, Kimberly A. 5 17/11/2014 57 4.02 699 7 Plaza Retail REIT Trust Units Trenholm, Barbara 4 01/01/2014 00 Plaza Retail REIT Trust Units Trenholm, Barbara 4 01/01/2014 00 26,315 Plaza Retail REIT Trust Units Trenholm, Barbara 4 01/01/2014 00 Plaza Retail REIT Trust Units Trenholm, Barbara 4 01/01/2014 00 45,000 Posera-HDX Limited Common Shares Shulman, Allen 5 18/11/2014 10 0.265 1,172,258 1,500 Potash Corporation of Common Shares Arnason, Daphne 5 18/11/2014 51 12.21 321,940 50,000 Saskatchewan Inc. Potash Corporation of Common Shares Arnason, Daphne 5 18/11/2014 10 40.167 271,940 -50,000 Saskatchewan Inc. Potash Corporation of Options Employee Stock Arnason, Daphne 5 18/11/2014 51 12.21 271,900 -50,000 Saskatchewan Inc. Options Potash Corporation of Common Shares Dowdle, Stephen 7 14/11/2014 10 33.58 36,586 -5,000 Saskatchewan Inc. Potash Corporation of Common Shares Flahr, William 5 19/11/2014 51 12.21 26,257 12,000 Saskatchewan Inc. Potash Corporation of Common Shares Flahr, William 5 19/11/2014 10 41.04 14,257 -12,000 Saskatchewan Inc. Potash Corporation of Options Employee Stock Flahr, William 5 19/11/2014 51 12.21 124,100 -12,000 Saskatchewan Inc. Options Potash Ridge Corporation Common Shares Inwentash, Sheldon 6 18/11/2014 10 0.1847 11,024,500 500,000 Potash Ridge Corporation Common Shares Pinetree Capital Ltd. 3 18/11/2014 10 0.1847 11,024,500 500,000 Precision Drilling Corporation Common Shares FORD, CAREY THOMAS 7 19/11/2014 10 7.3599 14,441 2,000 Premium Brands Holdings Common Shares BELIVEAU, JOHN 7 14/11/2014 30 23.03 36,411 60 Corporation STEPHEN Premium Brands Holdings Common Shares CARRIERE, DAVID 5 14/11/2014 30 23.03 74,470 61 Corporation JOSEPH LEONARD Pretium Resources Inc. Common Shares Quartermain, Robert Allan 4, 5 20/11/2014 47 6.84 2,700,353 -4,000
November 27, 2014 (2014), 37 OSCB 10630
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Prime Meridian Resources Common Shares Fretwell, Gordon 5 11/08/2014 00 Corp. Prime Meridian Resources Common Shares Fretwell, Gordon 5 13/11/2014 10 0.11 2,500 2,500 Corp. Prime Meridian Resources Common Shares Fretwell, Gordon 5 18/11/2014 10 0.17 5,000 2,500 Corp. Prime Meridian Resources Common Shares Leeners, Brian 4 23/10/2013 00 Corp. Prime Meridian Resources Common Shares Leeners, Brian 4 13/11/2014 10 0.11 2,500 2,500 Corp. Prime Meridian Resources Common Shares Leeners, Brian 4 18/11/2014 10 0.17 5,000 2,500 Corp. Primero Mining Corp. Common Shares Blaiklock, David 5 21/11/2014 10 5 10,942 -3,943 Primero Mining Corp. Common Shares Blaiklock, David 5 21/11/2014 10 5.02 7,442 -3,500 Prism Medical Ltd. Common Shares Spinks, Jeffrey 4 19/11/2014 10 8 49,100 4,100 Prism Medical Ltd. Common Shares Spinks, Jeffrey 4 20/11/2014 10 8.05 50,000 900 Pulse Seismic Inc. Common Shares Pulse Seismic Inc. 1 17/11/2014 38 3.0079 100,770 18,154 Pulse Seismic Inc. Common Shares Pulse Seismic Inc. 1 18/11/2014 38 3.0898 118,924 18,154 Pulse Seismic Inc. Common Shares Pulse Seismic Inc. 1 19/11/2014 38 3.0885 137,078 18,154 Pulse Seismic Inc. Common Shares Pulse Seismic Inc. 1 20/11/2014 38 3.1374 155,232 18,154 Pulse Seismic Inc. Common Shares Pulse Seismic Inc. 1 21/11/2014 38 3.15 173,386 18,154 Puma Exploration Inc. Common Shares Cordick, Arness William 3, 4 14/11/2014 10 0.14 10,870,000 80,000 Ross Puma Exploration Inc. Common Shares Cordick, Arness William 3, 4 14/11/2014 10 0.145 10,875,000 5,000 Ross Puma Exploration Inc. Common Shares Cordick, Arness William 3, 4 17/11/2014 10 0.14 10,890,000 15,000 Ross Puma Exploration Inc. Common Shares Robillard, Marcel 4, 5 18/11/2014 10 0.14 1,553,000 30,000 Puma Exploration Inc. Common Shares Robillard, Marcel 4, 5 18/11/2014 10 0.145 1,563,000 10,000 Puma Exploration Inc. Common Shares Robillard, Marcel 4, 5 18/11/2014 10 0.145 1,573,000 10,000 Puma Exploration Inc. Common Shares Robillard, Marcel 4, 5 19/11/2014 10 0.14 1,593,000 20,000 Puma Exploration Inc. Common Shares Robillard, Marcel 4, 5 21/11/2014 10 0.145 1,603,000 10,000 Pure Industrial Real Estate Restricted Units Tam, Francis 5 18/11/2014 97 4.62 58,372 2,561 Trust Pure Industrial Real Estate Trust Units Tam, Francis 5 18/11/2014 10 4.48 4,275 950 Trust Pure Multi-Family REIT LP Limited Partnership Units Evans, Steve 4, 5 17/11/2014 10 5.3954 67,000 7,000 Class A Pure Multi-Family REIT LP Limited Partnership Units Evans, Steve 4, 5 17/11/2014 10 5.4 70,100 3,100 Class A Pure Multi-Family REIT LP Limited Partnership Units Evans, Steve 4, 5 17/11/2014 10 5.4944 90,000 19,900 Class A Pure Multi-Family REIT LP Limited Partnership Units Evans, Steve 4, 5 18/11/2014 10 5.5786 99,000 9,000 Class A Pure Technologies Ltd. Common Shares Budianto, Robert 5 14/11/2014 30 7.68 12,670 434 Pure Technologies Ltd. Options Budianto, Robert 5 17/11/2014 50 7.62 125,000 35,000 Pure Technologies Ltd. Common Shares Elliott, John Francis 5 14/11/2014 30 7.68 209,097 635 Pure Technologies Ltd. Options Elliott, John Francis 5 17/11/2014 50 7.62 275,000 75,000 Pure Technologies Ltd. Options Fischer, Charles Wayne 4 17/11/2014 50 7.62 125,000 25,000 Pure Technologies Ltd. Common Shares Higgins, Michael 5 14/11/2014 30 7.68 24,346 530 Pure Technologies Ltd. Common Shares Higgins, Michael 5 17/11/2014 51 4.15 27,246 2,900 Pure Technologies Ltd. Common Shares Higgins, Michael 5 17/11/2014 10 7.37 24,346 -2,900 Pure Technologies Ltd. Common Shares Higgins, Michael 5 17/11/2014 51 4.15 35,246 10,900 Pure Technologies Ltd. Common Shares Higgins, Michael 5 17/11/2014 10 7.4 24,346 -10,900 Pure Technologies Ltd. Common Shares Higgins, Michael 5 17/11/2014 51 4.15 25,246 900 Pure Technologies Ltd. Common Shares Higgins, Michael 5 17/11/2014 10 7.44 24,346 -900 Pure Technologies Ltd. Common Shares Higgins, Michael 5 17/11/2014 51 4.15 24,646 300 Pure Technologies Ltd. Common Shares Higgins, Michael 5 17/11/2014 10 7.43 24,346 -300 Pure Technologies Ltd. Options Higgins, Michael 5 17/11/2014 51 4.15 102,100 -2,900 Pure Technologies Ltd. Options Higgins, Michael 5 17/11/2014 51 4.15 91,200 -10,900 Pure Technologies Ltd. Options Higgins, Michael 5 17/11/2014 51 4.15 90,300 -900 Pure Technologies Ltd. Options Higgins, Michael 5 17/11/2014 51 4.15 90,000 -300
November 27, 2014 (2014), 37 OSCB 10631
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Pure Technologies Ltd. Options Higgins, Michael 5 17/11/2014 50 7.62 125,000 35,000 Pure Technologies Ltd. Common Shares Holley, Mark William 5 14/11/2014 30 7.68 242,114 597 Pure Technologies Ltd. Options Holley, Mark William 5 17/11/2014 50 7.62 189,700 50,000 Pure Technologies Ltd. Common Shares Kanovsky, Michael Manuel 4 19/11/2014 51 125,000 25,000 Pure Technologies Ltd. Options Kanovsky, Michael Manuel 4 17/11/2014 50 150,000 25,000 Pure Technologies Ltd. Options Kanovsky, Michael Manuel 4 19/11/2014 51 4.15 125,000 -25,000 Pure Technologies Ltd. Common Shares Krause, Geoffrey Dean 5 14/11/2014 30 7.68 1,867 542 Pure Technologies Ltd. Options Krause, Geoffrey Dean 5 17/11/2014 50 7.62 70,000 35,000 Pure Technologies Ltd. Options MACDONALD, SCOTT IAN 4 17/11/2014 50 7.62 75,000 25,000 Pure Technologies Ltd. Common Shares McDermid, David Hugh 4 14/05/2008 00 Pure Technologies Ltd. Common Shares McDermid, David Hugh 4 17/11/2014 51 4.15 25,000 25,000 Pure Technologies Ltd. Options McDermid, David Hugh 4 17/11/2014 51 4.15 -25,000 Pure Technologies Ltd. Options McDermid, David Hugh 4 17/11/2014 51 4.15 -25,000 Pure Technologies Ltd. Options McDermid, David Hugh 4 17/11/2014 51 4.15 100,000 -25,000 Pure Technologies Ltd. Options McDermid, David Hugh 4 17/11/2014 50 7.62 125,000 25,000 Pure Technologies Ltd. Common Shares Paulson, James Edward 4, 6, 5 14/11/2014 30 7.68 88,238 635 Pure Technologies Ltd. Options Paulson, James Edward 4, 6, 5 17/11/2014 50 7.62 250,000 50,000 Pure Technologies Ltd. Common Shares Paulson, Peter Osborne 4, 6, 5 14/11/2014 30 7.68 211,980 636 Pure Technologies Ltd. Options Paulson, Peter Osborne 4, 6, 5 17/11/2014 50 7.62 250,000 50,000 Pure Technologies Ltd. Common Shares Springer, Nicole 5 14/11/2014 30 7.68 976 219 Pure Technologies Ltd. Common Shares Springer, Nicole 5 14/11/2014 30 7.68 581 130 Pure Technologies Ltd. Common Shares Springer, Nicole 5 14/11/2014 30 7.68 231 52 Pure Technologies Ltd. Options Springer, Nicole 5 17/11/2014 50 7.62 55,000 30,000 Pure Technologies Ltd. Options WRIGGLESWORTH, 5 17/11/2014 50 7.62 155,000 30,000 MICHAEL ROBERT PWC Capital Inc. (formerly Common Shares George, Eugene 3 11/11/2014 10 0.4 467,000 7,500 Pacific & Western Credit Corp.) PWC Capital Inc. (formerly Common Shares George, Eugene 3 12/11/2014 10 0.4 544,500 77,500 Pacific & Western Credit Corp.) PWC Capital Inc. (formerly Common Shares George, Eugene 3 13/11/2014 10 0.42 547,000 2,500 Pacific & Western Credit Corp.) PWC Capital Inc. (formerly Common Shares George, Eugene 3 14/11/2014 10 0.42 555,500 8,500 Pacific & Western Credit Corp.) PWC Capital Inc. (formerly Common Shares George, Eugene 3 18/11/2014 10 0.42 568,500 13,000 Pacific & Western Credit Corp.) PWC Capital Inc. (formerly Common Shares George, Eugene 3 19/11/2014 10 0.44 578,000 9,500 Pacific & Western Credit Corp.) PWC Capital Inc. (formerly Common Shares George, Eugene 3 20/11/2014 10 0.45 653,000 75,000 Pacific & Western Credit Corp.) Quebecor Inc. Subordinate Voting Paré, Robert 4 18/11/2014 10 30.245 16,500 15,000 Shares Catégorie B Questerre Energy Common Shares Mandatum Life Insurance 3 12/11/2014 10 0.68 29,041,750 -7,413 Corporation Company Limited Questerre Energy Common Shares Mandatum Life Insurance 3 13/11/2014 10 0.67 29,025,726 -16,024 Corporation Company Limited Questerre Energy Common Shares Mandatum Life Insurance 3 13/11/2014 10 0.66 29,018,022 -7,704 Corporation Company Limited Questerre Energy Common Shares Mandatum Life Insurance 3 14/11/2014 10 0.64 28,942,312 -75,710 Corporation Company Limited Questerre Energy Common Shares Mandatum Life Insurance 3 20/11/2014 10 0.6 28,925,712 -16,600 Corporation Company Limited Raven Rock Strategic Units Arrow Capital Management 7 18/11/2014 10 9.1 9,600 -1,500 Income Fund Inc. Raven Rock Strategic Units Arrow Capital Management 7 19/11/2014 10 9.1 8,100 -1,500 Income Fund Inc. Raven Rock Strategic Units McGovern, James 7 17/11/2014 10 10.33 1,400 -1,500 Income Fund
November 27, 2014 (2014), 37 OSCB 10632
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Red Eagle Mining Warrants Slater, Ian 4, 5 06/11/2014 38 0.25 100,000 Corporation Red Eagle Mining Warrants Slater, Ian 4, 5 06/11/2014 38 0.25 1,000,000 1,000,000 Corporation Regal Lifestyle Communities Common Shares Lemay, Daniel 4 26/09/2014 10 8.5 105,000 -3,100 Inc. Regal Lifestyle Communities Common Shares Lemay, Daniel 4 29/09/2014 10 8.5 103,000 -2,000 Inc. Regal Lifestyle Communities Common Shares Lemay, Daniel 4 12/11/2014 10 8.77 92,000 -11,000 Inc. Regal Lifestyle Communities Common Shares Lemay, Daniel 4 13/11/2014 10 8.77 82,500 -9,500 Inc. Regal Lifestyle Communities Common Shares Lemay, Daniel 4 14/11/2014 10 8.82 80,400 -2,100 Inc. Regal Lifestyle Communities Common Shares Lemay, Daniel 4 17/11/2014 10 8.75 61,200 -19,200 Inc. Regal Lifestyle Communities Common Shares Lemay, Daniel 4 18/11/2014 10 8.75 59,100 -2,100 Inc. Regal Lifestyle Communities Common Shares Lemay, Daniel 4 19/11/2014 10 8.75 58,400 -700 Inc. REIT INDEXPLUS Income Trust Units REIT INDEXPLUS Income 1 14/11/2014 38 12 6,214,196 800 Fund Fund REIT INDEXPLUS Income Trust Units REIT INDEXPLUS Income 1 18/11/2014 38 12.05 6,214,496 300 Fund Fund REIT INDEXPLUS Income Trust Units REIT INDEXPLUS Income 1 19/11/2014 38 12.1 6,216,096 1,600 Fund Fund REIT INDEXPLUS Income Trust Units REIT INDEXPLUS Income 1 20/11/2014 38 12.1 6,216,896 800 Fund Fund Response Biomedical Corp Restricted Share Units Keegan, Joseph D. 4 14/11/2014 56 17,059 6,534 Response Biomedical Corp Options Kinnaird-Steen, Barbara 5 14/11/2014 50 0.88 134,424 25,000 Response Biomedical Corp Rights Restricted Share Severson, Clinton H. 4 14/11/2014 56 17,627 7,102 Units Response Biomedical Corp Rights Restricted Share Shuster, Lewis J. 4 14/11/2014 56 25,317 9,943 Unit Response Biomedical Corp Rights Restricted Share Thompson, Peter 4 14/11/2014 56 22,188 9,124 Units Response Biomedical Corp Rights Restricted Share Wang, David Guowei 4 14/11/2014 56 22,478 4,261 Unit Response Biomedical Corp Rights Restricted Share Wang, Jonathan Jian 4 14/11/2014 56 31,679 7,102 Units Richelieu Hardware Ltd. Common Shares Auclair, Antoine 5 13/11/2014 30 55.326 1,712 38 Richelieu Hardware Ltd. Common Shares Dion, Christian 5 13/11/2014 30 55.326 1,590 9 Richelieu Hardware Ltd. Common Shares Grenier, Guy 5 13/11/2014 30 55.326 9,856 22 Richelieu Hardware Ltd. Common Shares Grenier, Guy 5 13/11/2014 30 55.326 24,132 33 Richelieu Hardware Ltd. Common Shares Lord, Richard 4, 5 13/11/2014 30 55.326 1,399,616 43 Richelieu Hardware Ltd. Common Shares Quevillon, Geneviève 5 13/11/2014 30 55.326 1,522 16 Richmont Mines Inc. Options Adams, Renaud 5 17/11/2014 00 800,000 Richmont Mines Inc. Common Shares Veilleux, Nicole 5 17/11/2014 10 3.01 32,000 -3,000 RIOCAN REAL ESTATE Options Waks, Frederic Allen 5 17/11/2014 51 26.35 980,114 -200,000 INVESTMENT TRUST RIOCAN REAL ESTATE Options Waks, Frederic Allen 5 17/11/2014 51 21.16 800,000 -180,114 INVESTMENT TRUST RIOCAN REAL ESTATE Options Waks, Frederic Allen 5 17/11/2014 51 24.94 650,000 -150,000 INVESTMENT TRUST RIOCAN REAL ESTATE Trust Units Waks, Frederic Allen 5 07/10/2014 30 24.09 2,571 12 INVESTMENT TRUST RIOCAN REAL ESTATE Trust Units Waks, Frederic Allen 5 07/10/2014 30 24.9 1,418 6 INVESTMENT TRUST RIOCAN REAL ESTATE Trust Units Waks, Frederic Allen 5 07/10/2014 30 24.9 3,018 14 INVESTMENT TRUST RIOCAN REAL ESTATE Trust Units Waks, Frederic Allen 5 07/10/2014 30 24.9 2,628 12 INVESTMENT TRUST RIOCAN REAL ESTATE Trust Units Waks, Frederic Allen 5 07/10/2014 30 24.9 2,089 9 INVESTMENT TRUST RIOCAN REAL ESTATE Trust Units Waks, Frederic Allen 5 07/10/2014 30 24.9 2,089 9 INVESTMENT TRUST
November 27, 2014 (2014), 37 OSCB 10633
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed RIOCAN REAL ESTATE Trust Units Waks, Frederic Allen 5 07/10/2014 30 24.9 35,117 164 INVESTMENT TRUST RIOCAN REAL ESTATE Trust Units Waks, Frederic Allen 5 07/10/2014 30 24.9 580 2 INVESTMENT TRUST RIOCAN REAL ESTATE Trust Units Waks, Frederic Allen 5 13/11/2014 10 26.557 -200,000 INVESTMENT TRUST RIOCAN REAL ESTATE Trust Units Waks, Frederic Allen 5 13/11/2014 10 26.557 -200,000 INVESTMENT TRUST RIOCAN REAL ESTATE Trust Units Waks, Frederic Allen 5 13/11/2014 10 26.557 180,114 INVESTMENT TRUST RIOCAN REAL ESTATE Trust Units Waks, Frederic Allen 5 13/11/2014 10 26.557 -180,114 INVESTMENT TRUST RIOCAN REAL ESTATE Trust Units Waks, Frederic Allen 5 13/11/2014 10 26.557 -180,114 INVESTMENT TRUST RIOCAN REAL ESTATE Trust Units Waks, Frederic Allen 5 13/11/2014 10 26.557 150,000 INVESTMENT TRUST RIOCAN REAL ESTATE Trust Units Waks, Frederic Allen 5 13/11/2014 10 26.557 -150,000 INVESTMENT TRUST RIOCAN REAL ESTATE Trust Units Waks, Frederic Allen 5 13/11/2014 10 26.557 -150,000 INVESTMENT TRUST RIOCAN REAL ESTATE Trust Units Waks, Frederic Allen 5 13/11/2014 10 26.557 -483,700 INVESTMENT TRUST RIOCAN REAL ESTATE Trust Units Waks, Frederic Allen 5 13/11/2014 10 26.557 -483,700 INVESTMENT TRUST RIOCAN REAL ESTATE Trust Units Waks, Frederic Allen 5 13/11/2014 10 26.557 -401,097 -483,700 INVESTMENT TRUST RIOCAN REAL ESTATE Trust Units Waks, Frederic Allen 5 17/11/2014 51 26.35 -201,097 200,000 INVESTMENT TRUST RIOCAN REAL ESTATE Trust Units Waks, Frederic Allen 5 17/11/2014 51 21.16 -20,983 180,114 INVESTMENT TRUST RIOCAN REAL ESTATE Trust Units Waks, Frederic Allen 5 17/11/2014 51 24.94 129,017 150,000 INVESTMENT TRUST RIOCAN REAL ESTATE Trust Units Waks, Frederic Allen 5 17/11/2014 47 -46,414 INVESTMENT TRUST RIOCAN REAL ESTATE Trust Units Waks, Frederic Allen 5 18/11/2014 47 26.819 82,603 -46,414 INVESTMENT TRUST Ritchie Bros. Auctioneers Common Shares Hinkelman, Curt 5 21/11/2014 10 25.86 37,997 -7,500 Incorporated Ritchie Bros. Auctioneers Options Johnston, Michael D. 5 19/11/2014 59 25.355 60,979 -2,000 Incorporated Ritchie Bros. Auctioneers Options Simpson, Steve 5 18/11/2014 59 25.32 115,690 -19,500 Incorporated Riverside Resources Inc. Options Clare, James 4 14/11/2014 50 280,000 55,000 Riverside Resources Inc. Options Dare, Jeffrey 5 14/11/2014 50 0.27 128,000 38,000 Riverside Resources Inc. Options Doggett, Michael David 4 14/11/2014 50 0.27 230,000 55,000 Riverside Resources Inc. Options Groves, Brian John 4 14/11/2014 50 0.27 280,000 55,000 Riverside Resources Inc. Options Lang, Joness 5 14/11/2014 50 0.27 227,500 100,000 Riverside Resources Inc. Options Lee, William 4 14/11/2014 50 0.27 330,000 55,000 Riverside Resources Inc. Options Scott, Robert James 5 14/11/2014 50 0.27 535,000 160,000 Riverside Resources Inc. Options Staude, John-Mark Gardner 5 14/11/2014 50 0.27 810,000 235,000 RockBridge Resources Inc. Common Shares Planaval Resources Ltd. 4, 5 20/11/2014 10 0.03 18,000 10,000 Rockhaven Resources Ltd. Common Shares Eaton, William Douglas 6 13/11/2014 10 11,166,000 1,000 Rockhaven Resources Ltd. Common Shares Eaton, William Douglas 6 18/11/2014 10 11,170,000 4,000 Rocky Mountain Dealerships Common Shares Tannas, Scott 4 13/11/2014 10 10.84 14,300 900 Inc. Rocky Mountain Dealerships Common Shares Tannas, Scott 4 14/11/2014 10 10.84 15,900 1,600 Inc. Rogers Communications Inc. Non-Voting Shares Class Baldachin, Lawrence R. 5 17/11/2014 30 43.35 296 273 B Rogers Communications Inc. Non-Voting Shares Class Baldachin, Lawrence R. 5 17/11/2014 10 44.22 208 -88 B Rogers Communications Inc. Options (Performance) Bruce, Robert W. 7, 5 20/11/2014 38 155,470 -11,275 Rogers Communications Inc. Options (Performance) Bruce, Robert W. 7, 5 20/11/2014 38 122,695 -32,775 Rogers Communications Inc. Options (Performance) Bruce, Robert W. 7, 5 20/11/2014 38 95,245 -27,450
November 27, 2014 (2014), 37 OSCB 10634
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Rogers Communications Inc. Stock Appreciation Rights Bruce, Robert W. 7, 5 20/11/2014 59 10.587 155,470 -11,275 (Performance) Rogers Communications Inc. Stock Appreciation Rights Bruce, Robert W. 7, 5 20/11/2014 59 11.002 122,695 -32,775 (Performance) Rogers Communications Inc. Stock Appreciation Rights Bruce, Robert W. 7, 5 20/11/2014 59 7.3605 95,245 -27,450 (Performance) RONA inc. Common Shares Kennedy, Gordon Samuel 5 18/11/2014 10 14.415 1,682 200 RONA inc. Common Shares Kennedy, Gordon Samuel 5 18/11/2014 10 14.42 1,716 34 RONA inc. Common Shares Lalonde, Marie-Claude 5 18/11/2014 51 10.62 22,104 11,000 RONA inc. Common Shares Lalonde, Marie-Claude 5 18/11/2014 51 9.38 27,654 5,550 RONA inc. Common Shares Lalonde, Marie-Claude 5 18/11/2014 10 14.5 11,104 -16,550 RONA inc. Options Lalonde, Marie-Claude 5 18/11/2014 51 10.62 65,050 -11,000 RONA inc. Options Lalonde, Marie-Claude 5 18/11/2014 51 9.38 59,500 -5,550 Route1 Inc. Common Shares Boensel, Mark Stephen 4 17/11/2014 10 0.0418 495,483 88,745 Route1 Inc. Common Shares Chodos, Peter F. 4 17/11/2014 10 0.045 692,222 65,566 Route1 Inc. Common Shares Doolan, Michael Frederick 4 17/11/2014 10 1,610,000 54,453 Route1 Inc. Common Shares Fraser, David 4 17/11/2014 10 0.045 463,900 81,412 Route1 Inc. Common Shares Harris, Michael Deane 4 24/09/2009 00 Route1 Inc. Common Shares Harris, Michael Deane 4 19/11/2014 10 0.04 110,000 110,000 Route1 Inc. Common Shares Harris, Michael Deane 4 19/11/2014 10 0.043 125,000 15,000 Route1 Inc. Common Shares Harris, Michael Deane 4 17/11/2014 10 0.045 899,556 82,235 Royal Bank of Canada Common Shares McKay, David Ian 4, 5 21/11/2014 51 31.7 3,758 1,300 Royal Bank of Canada Common Shares McKay, David Ian 4, 5 21/11/2014 10 82.609 2,458 -1,300 Royal Bank of Canada Options McKay, David Ian 4, 5 21/11/2014 51 31.7 561,034 -1,300 Russel Metals Inc. Common Shares Britton, Marion Eleanor 5 18/11/2014 10 25.75 87,926 15,000 Russel Metals Inc. Options Britton, Marion Eleanor 5 18/11/2014 51 25.75 322,592 -15,000 SANDSTORM GOLD LTD. Options Awram, David 4, 5 13/11/2014 50 942,474 582,474 SANDSTORM GOLD LTD. Options Budreski, John Philip Adrian 4 13/11/2014 50 555,000 185,000 SANDSTORM GOLD LTD. Options De Witt, David E. 4 13/11/2014 50 555,000 185,000 SANDSTORM GOLD LTD. Options KAZEMI-ESFAHANI, 5 13/11/2014 50 430,000 350,000 ERFAN SANDSTORM GOLD LTD. Rights Restricted Share KAZEMI-ESFAHANI, 5 13/11/2014 56 61,898 17,500 Rights ERFAN SANDSTORM GOLD LTD. Options Little, Mary Lois 4 25/06/2014 00 SANDSTORM GOLD LTD. Options Little, Mary Lois 4 13/11/2014 50 235,000 235,000 SANDSTORM GOLD LTD. Options Swarthout, Andrew 4 13/11/2014 50 555,000 185,000 SANDSTORM GOLD LTD. Options Watson, Nolan Allan 4, 5 13/11/2014 50 1,023,500 700,000 Sandvine Corporation Common Shares Caputo, David 4 21/11/2014 30 2.9 95,957 621 Sandvine Corporation Common Shares Donnelly, Tom 5 21/11/2014 30 2.9 17,098 136 Sandvine Corporation Common Shares Hamilton, Scott 4 21/11/2014 30 2.9 4,376 58 Sandvine Corporation Common Shares Siim, Brad 5 21/11/2014 30 2.9 24,915 280 Sangoma Technologies Options Laliberte, Yves 4 05/06/2014 50 0.35 200,000 50,000 Corporation Saputo Inc. Common Shares Corney, Paul 7, 5 17/11/2014 51 10.7 8,918 1,000 Saputo Inc. Common Shares Corney, Paul 7, 5 17/11/2014 51 14.66 9,418 500 Saputo Inc. Common Shares Corney, Paul 7, 5 17/11/2014 51 21.48 11,418 2,000 Saputo Inc. Common Shares Corney, Paul 7, 5 17/11/2014 51 25.55 12,418 1,000 Saputo Inc. Common Shares Corney, Paul 7, 5 17/11/2014 10 33.25 12,318 -100 Saputo Inc. Common Shares Corney, Paul 7, 5 17/11/2014 10 33.17 10,518 -1,800 Saputo Inc. Common Shares Corney, Paul 7, 5 17/11/2014 10 33.16 9,618 -900 Saputo Inc. Common Shares Corney, Paul 7, 5 17/11/2014 10 33.15 8,918 -700 Saputo Inc. Common Shares Corney, Paul 7, 5 17/11/2014 10 33.14 7,918 -1,000 Saputo Inc. Options Corney, Paul 7, 5 17/11/2014 51 10.7 126,010 -1,000 Saputo Inc. Options Corney, Paul 7, 5 17/11/2014 51 14.66 125,510 -500 Saputo Inc. Options Corney, Paul 7, 5 17/11/2014 51 21.48 123,510 -2,000 Saputo Inc. Options Corney, Paul 7, 5 17/11/2014 51 25.55 122,510 -1,000 Saputo Inc. Common Shares Wagner, Gaétane 5 17/11/2014 10 33.49 5,814 1,300 Saputo Inc. Common Shares Wagner, Gaétane 5 17/11/2014 10 33.5 5,984 170 Savanna Energy Services Options Carriere, Eugene 7 13/11/2014 50 5.86 127,074 17,998 Corp.
November 27, 2014 (2014), 37 OSCB 10635
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Savanna Energy Services Restricted Share Units Carriere, Eugene 7 13/11/2014 56 8,654 2,795 Corp. (cash based ony) Savanna Energy Services Options Chow, George K. 5 13/11/2014 50 5.86 524,747 116,209 Corp. Savanna Energy Services Options Cooper, John William 5 13/11/2014 50 5.86 587,167 142,170 Corp. Savanna Energy Services Options Draudson, Darcy 5 13/11/2014 50 5.86 524,747 116,209 Corp. Savanna Energy Services Options Gindl, Christopher Michael 7 14/10/2014 00 Corp. Savanna Energy Services Options Gindl, Christopher Michael 7 13/11/2014 50 5.86 19,368 19,368 Corp. Savanna Energy Services Restricted Share Units Gindl, Christopher Michael 7 14/10/2014 00 Corp. (cash based ony) Savanna Energy Services Restricted Share Units Gindl, Christopher Michael 7 13/11/2014 56 3,008 3,008 Corp. (cash based ony) Savanna Energy Services Options LaMontagne, Dwayne Kevin 5 13/11/2014 50 5.86 524,747 116,209 Corp. Savanna Energy Services Options Mills, Aaron 7 13/11/2014 50 5.86 157,509 27,038 Corp. Savanna Energy Services Restricted Share Units Mills, Aaron 7 13/11/2014 56 10,862 4,199 Corp. (cash based ony) Savanna Energy Services Options Moore, Rachel 5 13/11/2014 50 5.86 446,259 106,319 Corp. Savanna Energy Services Common Shares MULLEN, Kenneth Brandon 4, 5 18/11/2014 10 5.25 191,234 5,000 Corp. Savanna Energy Services Options MULLEN, Kenneth Brandon4, 5 13/11/2014 50 5.86 813,772 182,967 Corp. Savanna Energy Services Options Russell, Evan 7 13/11/2014 50 5.86 96,953 17,454 Corp. Savanna Energy Services Restricted Share Units Russell, Evan 7 13/11/2014 56 8,737 2,710 Corp. (cash based ony) Savanna Energy Services Options Torriero, Richard 7 13/11/2014 50 5.86 81,838 14,011 Corp. Savanna Energy Services Restricted Share Units Torriero, Richard 7 13/11/2014 56 6,464 2,176 Corp. (cash based ony) Sears Canada Inc. Subscription Rights DePodesta, Paul Gregeory 6 13/11/2014 73 0 -2,500 Subscription Rights 1 subscription right = 0.375643 common s Sears Canada Inc. Common Shares ESL Investments, Inc. 3 13/11/2014 72 derivative 26,197,207 1,389,984 Sears Canada Inc. Common Shares Kunkler III, William Charles 6 13/11/2012 35 9,914 Sears Canada Inc. Common Shares Kunkler III, William Charles 6 13/11/2012 35 9,913 9,913 Sears Canada Inc. Common Shares Lampert, Edward S. 3, 6 13/11/2014 72 derivative 22,333,406 1,483,102 Sears Canada Inc. Common Shares Lampert, Edward S. 3, 6 13/11/2014 72 derivative 26,197,207 1,389,984 Sears Canada Inc. Common Shares Mnuchin, Steven Terner 6 13/11/2012 00 Sears Canada Inc. Common Shares Mnuchin, Steven Terner 6 13/11/2012 00 Sears Canada Inc. Common Shares Mnuchin, Steven Terner 6 13/11/2012 35 85 Sears Canada Inc. Common Shares Mnuchin, Steven Terner 6 13/11/2012 35 85 Sears Canada Inc. Common Shares Mnuchin, Steven Terner 6 13/11/2012 35 85 Sears Canada Inc. Common Shares Mnuchin, Steven Terner 6 13/11/2012 00 Sears Canada Inc. Common Shares Mnuchin, Steven Terner 6 13/11/2012 00 Sears Canada Inc. Common Shares Mnuchin, Steven Terner 6 13/11/2012 35 85 Sears Canada Inc. Common Shares Mnuchin, Steven Terner 6 13/11/2012 35 85 Sears Canada Inc. Common Shares Mnuchin, Steven Terner 6 13/11/2012 35 85 Sears Canada Inc. Common Shares Mnuchin, Steven Terner 6 13/11/2012 00 Sears Canada Inc. Common Shares Mnuchin, Steven Terner 6 13/11/2012 00 Sears Canada Inc. Common Shares Mnuchin, Steven Terner 6 13/11/2012 35 85 Sears Canada Inc. Common Shares Mnuchin, Steven Terner 6 13/11/2012 35 85 Sears Canada Inc. Common Shares Mnuchin, Steven Terner 6 13/11/2012 35 85 Sears Canada Inc. Common Shares Mnuchin, Steven Terner 6 13/11/2012 00 Sears Canada Inc. Common Shares Mnuchin, Steven Terner 6 13/11/2012 00 Sears Canada Inc. Common Shares Mnuchin, Steven Terner 6 13/11/2012 35 85 Sears Canada Inc. Common Shares Mnuchin, Steven Terner 6 13/11/2012 35 85
November 27, 2014 (2014), 37 OSCB 10636
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Sears Canada Inc. Common Shares Mnuchin, Steven Terner 6 13/11/2012 35 85 Sears Canada Inc. Common Shares Mnuchin, Steven Terner 6 13/11/2012 00 Sears Canada Inc. Common Shares Mnuchin, Steven Terner 6 13/11/2012 00 Sears Canada Inc. Common Shares Mnuchin, Steven Terner 6 13/11/2012 00 Sears Canada Inc. Common Shares Mnuchin, Steven Terner 6 13/11/2012 00 Sears Canada Inc. Common Shares Mnuchin, Steven Terner 6 13/11/2012 35 6,852 Sears Canada Inc. Common Shares Mnuchin, Steven Terner 6 13/11/2012 35 6,852 Sears Canada Inc. Common Shares Mnuchin, Steven Terner 6 13/11/2012 35 6,852 Sears Canada Inc. Common Shares Mnuchin, Steven Terner 6 13/11/2012 00 Sears Canada Inc. Common Shares Mnuchin, Steven Terner 6 13/11/2012 00 Sears Canada Inc. Common Shares Mnuchin, Steven Terner 6 13/11/2012 35 85 Sears Canada Inc. Common Shares Mnuchin, Steven Terner 6 13/11/2012 35 85 Sears Canada Inc. Common Shares Mnuchin, Steven Terner 6 13/11/2012 35 85 Sears Canada Inc. Common Shares Mnuchin, Steven Terner 6 13/11/2012 00 Sears Canada Inc. Common Shares Mnuchin, Steven Terner 6 13/11/2012 00 Sears Canada Inc. Common Shares Mnuchin, Steven Terner 6 13/11/2012 35 3,426 Sears Canada Inc. Common Shares Mnuchin, Steven Terner 6 13/11/2012 35 3,426 Sears Canada Inc. Common Shares Mnuchin, Steven Terner 6 13/11/2012 35 3,426 Sears Canada Inc. Subscription Rights Mnuchin, Steven Terner 6 13/11/2014 73 0 -18,787 Conversion of 1 Subscription Receipt = 0.375643 Common Share Sears Canada Inc. Subscription Rights Mnuchin, Steven Terner 6 13/11/2014 73 0 -8,400 Conversion of 1 Subscription Receipt = 0.375643 Common Share Sears Canada Inc. Common Shares Reese, Ann Nolan 6 13/11/2012 00 Sears Canada Inc. Common Shares Reese, Ann Nolan 6 06/11/2014 71 3,756 3,756 Sears Canada Inc. Subscription Rights Reese, Ann Nolan 6 06/11/2014 71 0 -10,000 Conversion of 1 Subscription Receipt = Sears Canada Inc. Subscription Rights 1 Schriesheim, Robert 6 13/11/2014 73 0 -48,880 subscription = 0.375643 common Sears Canada Inc. Common Shares Sears Holdings Corporation 3 13/11/2014 11 11,413,388 390,847 Sears Canada Inc. Common Shares Sears Holdings Corporation 3 13/11/2014 15 0 -11,413,388 Sears Canada Inc. Common Shares Sears Holdings Corporation 3 13/11/2014 11 11,962,391 -390,847 Sears Canada Inc. Subscription Rights Sears Holdings Corporation 3 13/11/2014 73 0 -30,382,913 Sears Canada Inc. Common Shares Tisch, Thomas J. 6 13/11/2014 72 derivative 396,613 334,157 Sears Canada Inc. Common Shares Tisch, Thomas J. 6 13/11/2012 00 Sears Canada Inc. Common Shares Tisch, Thomas J. 6 13/11/2014 72 derivative 47,699 47,699 Sears Canada Inc. Common Shares Tisch, Thomas J. 6 13/11/2014 72 derivative 1,308,599 902,250 Sears Canada Inc. Subscription Rights Tisch, Thomas J. 6 13/11/2014 73 0 -620,824 Conversion of 1 Subscription Receipt = 0.37643 Common Share Sears Canada Inc. Subscription Rights Tisch, Thomas J. 6 13/11/2014 73 0 -3,534,527 Conversion of 1 Subscription Receipt = 0.37643 Common Share Secure Energy Services Inc. Common Shares Amirault, Rene 3, 4, 5 14/11/2014 30 19 24,799 163 Employee Share Ownership Plan Secure Energy Services Inc. Rights Deferred Share Cobbe, Murray Lynn 4 01/06/2014 30 22 17,426 14 Units Secure Energy Services Inc. Rights Deferred Share Cobbe, Murray Lynn 4 01/07/2014 30 22.19 17,439 13 Units Secure Energy Services Inc. Rights Deferred Share Cobbe, Murray Lynn 4 01/08/2014 30 25.63 17,450 11 Units Secure Energy Services Inc. Rights Deferred Share Cobbe, Murray Lynn 4 01/09/2014 30 24.99 17,462 12 Units Secure Energy Services Inc. Rights Deferred Share Cobbe, Murray Lynn 4 01/10/2014 30 20.47 17,476 14 Units Secure Energy Services Inc. Rights Deferred Share Cobbe, Murray Lynn 4 01/11/2014 30 18.74 17,492 16 Units
November 27, 2014 (2014), 37 OSCB 10637
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Secure Energy Services Inc. Common Shares Gransch, Allen Peter 5 14/11/2014 30 19 13,264 163 Employee Share Ownership Plan Secure Energy Services Inc. Common Shares Higham, Corey Ray 5 14/11/2014 30 19 15,416 84 Employee Share Ownership Plan Secure Energy Services Inc. Rights DSU's Johnson, David Daniel 4 14/11/2014 35 17,492 16 Secure Energy Services Inc. Common Shares McGurk, Brian Kenneth 5 14/11/2014 30 19 7,139 86 Employee Share Stanley Ownership Plan Secure Energy Services Inc. Rights DSU's MUNRO, BRADLEY R. 4, 7 14/11/2014 35 17,492 16 Secure Energy Services Inc. Rights DSU's NUGENT, Kevin 4 14/11/2014 35 17,492 16 Secure Energy Services Inc. Rights DSU (rights) Paterson, Richard Shaun 5 14/11/2014 35 9,364 9 Secure Energy Services Inc. Common Shares Steinke, Daniel 5 14/11/2014 30 19 14,387 71 Employee Share Ownership Plan Secure Energy Services Inc. Common Shares WADSWORTH, GEORGE 7 14/11/2014 10 20 596,507 -14,800 Secure Energy Services Inc. Common Shares WADSWORTH, GEORGE 7 14/11/2014 30 19 9,682 99 Employee Share Ownership Plan SecureCom Mobile Inc. Common Shares Wilson, Peter Grant 4 18/11/2014 10 0.53 10,000 SecureCom Mobile Inc. Common Shares Wilson, Peter Grant 4 18/11/2014 10 0.53 1,470,000 -10,000 Security Devices Options Ezer, Allen 4 01/01/2012 00 650,000 International Inc. Security Devices Options Ezer, Allen 4 11/09/2014 50 0.4 900,000 250,000 International Inc. Security Devices Options Stock Option Plan Thrasher, Dean 5 01/12/2011 00 400,000 International Inc. Senvest Capital Inc. Common Shares Malikotsis, George 5 17/11/2014 51 17 63,500 2,000 Senvest Capital Inc. Options Malikotsis, George 5 17/11/2014 51 17 10,000 -2,000 Sierra Wireless, Inc. Common Shares Aasen, Gregory D. 4 21/11/2014 51 22,822 7,952 Sierra Wireless, Inc. Common Shares Aasen, Gregory D. 4 21/11/2014 10 40.935 14,870 -7,952 Sierra Wireless, Inc. Options Aasen, Gregory D. 4 21/11/2014 51 9,623 -7,952 Sierra Wireless, Inc. Common Shares Dodson, Bill Gary 5 18/11/2014 10 44.81 2,708 -1,160 Sierra Wireless, Inc. Common Shares Guillemette, Philippe 5 17/11/2014 51 5,300 2,000 Frederic Joel Rene Sierra Wireless, Inc. Common Shares Guillemette, Philippe 5 17/11/2014 10 38.629 3,300 -2,000 Frederic Joel Rene Sierra Wireless, Inc. Common Shares Guillemette, Philippe 5 20/11/2014 10 37.403 1,000 -2,300 Frederic Joel Rene Sierra Wireless, Inc. Options Guillemette, Philippe 5 17/11/2014 51 35,051 -2,000 Frederic Joel Rene Sierra Wireless, Inc. Common Shares Krause, Jason Lawrence 5 18/11/2014 51 18,880 2,935 Sierra Wireless, Inc. Common Shares Krause, Jason Lawrence 5 18/11/2014 10 45.139 15,945 -2,935 Sierra Wireless, Inc. Options Krause, Jason Lawrence 5 18/11/2014 51 38,423 -2,935 Sierra Wireless, Inc. Common Shares Schieler, August Daniel 7 18/11/2014 51 25,370 2,889 Sierra Wireless, Inc. Common Shares Schieler, August Daniel 7 18/11/2014 10 39.644 22,481 -2,889 Sierra Wireless, Inc. Options Schieler, August Daniel 7 18/11/2014 51 52,794 -2,889 Sierra Wireless, Inc. Common Shares Teyssier, Pierre Jean Benoit 5 21/11/2014 51 4,403 1,741 Sierra Wireless, Inc. Common Shares Teyssier, Pierre Jean Benoit 5 21/11/2014 51 5,032 629 Sierra Wireless, Inc. Common Shares Teyssier, Pierre Jean Benoit 5 21/11/2014 10 38.69 4,403 -629 Sierra Wireless, Inc. Options Teyssier, Pierre Jean Benoit 5 21/11/2014 51 25,959 -1,741 Sierra Wireless, Inc. Options Teyssier, Pierre Jean Benoit 5 21/11/2014 51 25,330 -629 Silver Standard Resources Common Shares ANGLIN, Mike Arthur E. 4 21/11/2014 10 6 10,000 10,000 Inc. Slam Exploration Ltd. Common Shares Taylor, Michael R. 4, 5 19/11/2014 10 0.05 431,133 10,000 Slam Exploration Ltd. Common Shares Taylor, Michael R. 4, 5 21/11/2014 10 0.04 433,133 2,000 Slam Exploration Ltd. Common Shares Taylor, Michael R. 4, 5 21/11/2014 10 0.045 439,133 6,000 Slate Retail REIT (formerly, Trust Units Class U Units Stevenson, Gregory 5 17/11/2014 10 10.27 2,040 40 Slate U.S. Opportunity (No. 1) Realty Trust) Slate Retail REIT (formerly, Trust Units Class U Units Stevenson, Gregory 5 17/11/2014 10 10.34 4,940 2,900 Slate U.S. Opportunity (No. 1) Realty Trust)
November 27, 2014 (2014), 37 OSCB 10638
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Slate Retail REIT (formerly, Trust Units Class U Units Welch, Blair 4, 5 20/04/2012 00 Slate U.S. Opportunity (No. 1) Realty Trust) Slate Retail REIT (formerly, Trust Units Class U Units Welch, Blair 4, 5 18/11/2014 10 11.65 4,200 4,200 Slate U.S. Opportunity (No. 1) Realty Trust) SMART Technologies Inc. Restricted Share Units BARKLEY, WARREN 5 18/11/2014 57 1.33 112,000 -16,666 VINCENT SMART Technologies Inc. Subordinate Voting BARKLEY, WARREN 5 18/11/2014 57 29,532 16,666 Shares Class A VINCENT Subordinate Voting Shares SMART Technologies Inc. Subordinate Voting BARKLEY, WARREN 5 18/11/2014 10 1.33 22,582 -6,950 Shares Class A VINCENT Subordinate Voting Shares SMART Technologies Inc. Restricted Share Units GAYDON, NEIL 4, 5 18/11/2014 57 1.33 289,292 -25,000 SMART Technologies Inc. Subordinate Voting GAYDON, NEIL 4, 5 18/11/2014 57 76,166 25,000 Shares Class A Subordinate Voting Shares SMART Technologies Inc. Subordinate Voting GAYDON, NEIL 4, 5 18/11/2014 10 1.33 65,751 -10,415 Shares Class A Subordinate Voting Shares SMART Technologies Inc. Options Stock Options LOWE, JEFFREY ALAN 7 12/11/2014 50 1.33 30,300 4,883 under 2010 Equity Incentive Plan SnipGold Corp. Common Shares Grandison, Clifford Allan 4 17/11/2014 54 1,052,941 62,500 SnipGold Corp. Warrants Grandison, Clifford Allan 4 17/11/2014 54 187,500 -62,500 SOLITARIO EXPLORATION Common Shares Herald, Christopher 4 21/11/2014 10 0.95 1,462,662 2,000 & ROYALTY CORP. Solium Capital Inc. Common Shares Levine, Gary 5 13/11/2014 10 7.25 14,500 6,500 SoMedia Networks Inc. Common Shares Dueck, David Lee 3 06/11/2014 11 0.135 200,000 SoMedia Networks Inc. Common Shares Dueck, David Lee 3 10/11/2014 11 0.135 5,249,640 200,000 SoMedia Networks Inc. Warrants Dueck, David Lee 3 06/11/2014 53 0.2 35,000 SoMedia Networks Inc. Warrants Dueck, David Lee 3 10/11/2014 53 0.2 2,198,589 35,000 SoMedia Networks Inc. Common Shares Pickering, Benjamin 4, 5 12/11/2014 10 0.2 250,000 -50,000 SoMedia Networks Inc. Common Shares Pickering, Benjamin 4, 5 13/11/2014 10 0.22 225,000 -25,000 SoMedia Networks Inc. Common Shares Pickering, Benjamin 4, 5 13/11/2014 10 0.22 200,000 -25,000 SoMedia Networks Inc. Common Shares Pickering, Benjamin 4, 5 18/11/2014 10 0.19 204,000 4,000 SoMedia Networks Inc. Common Shares Pickering, Benjamin 4, 5 18/11/2014 10 0.195 221,000 17,000 SoMedia Networks Inc. Common Shares Pickering, Benjamin 4, 5 18/11/2014 10 0.2 231,000 10,000 SoMedia Networks Inc. Common Shares Pickering, Benjamin 4, 5 19/11/2014 10 0.195 236,000 5,000 Sonoro Metals Corp. Common Shares Kenwood, Stephen 4 10/11/2014 37 36,916 -36,917 Sonoro Metals Corp. Common Shares Kenwood, Stephen 4 10/11/2014 37 367,300 -367,300 Sonoro Metals Corp. Options Kenwood, Stephen 4 10/11/2014 37 0.6 75,000 -75,000 Sora Capital Corp. (formerly, Common Shares Reinhart, Paul Gerard 4, 5 09/01/2014 00 Jager Resources Inc. ) Sora Capital Corp. (formerly, Common Shares Reinhart, Paul Gerard 4, 5 05/03/2014 97 0.05 1,000,000 1,000,000 Jager Resources Inc. ) Sora Capital Corp. (formerly, Common Shares Scharfe, Jason Wesley 4 17/11/2014 10 0.19 81,500 3,000 Jager Resources Inc. ) Sora Capital Corp. (formerly, Common Shares Scharfe, Jason Wesley 4 18/11/2014 10 0.19 82,000 500 Jager Resources Inc. ) Spartan Energy Corp. Common Shares Boreen, Thomas Dale 5 14/11/2014 30 3 874,472 833 (formerly Alexander Energy Ltd.) Spartan Energy Corp. Common Shares KALANTZIS, FOTIS 5 14/11/2014 30 3 1,954,306 833 (formerly Alexander Energy Ltd.) Spartan Energy Corp. Common Shares MacDonald, Adam David 5 14/11/2014 30 3 861 (formerly Alexander Energy Ltd.) Spartan Energy Corp. Common Shares MacDonald, Adam David 5 14/11/2014 30 3 861 (formerly Alexander Energy Ltd.)
November 27, 2014 (2014), 37 OSCB 10639
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Spartan Energy Corp. Common Shares MacDonald, Adam David 5 14/11/2014 30 3 61,729 833 (formerly Alexander Energy Ltd.) Spartan Energy Corp. Common Shares McHardy, Richard Francis 4, 5 14/11/2014 30 3 288,203 917 (formerly Alexander Energy Ltd.) Spartan Energy Corp. Common Shares Stark, Albert Jason 5 14/11/2014 30 3 4,293,139 833 (formerly Alexander Energy Ltd.) Spartan Energy Corp. Common Shares Wong, Eddie 5 14/11/2014 30 3 1,743,556 833 (formerly Alexander Energy Ltd.) Sphere 3D Corporation Common Shares Inwentash, Sheldon 3 12/11/2014 10 9.85 2,464,000 2,000 (formerly T.B. Mining Ventures Inc.) Sphere 3D Corporation Common Shares Inwentash, Sheldon 3 13/11/2014 10 10.563 2,500,400 36,400 (formerly T.B. Mining Ventures Inc.) Sphere 3D Corporation Common Shares Inwentash, Sheldon 3 14/11/2014 10 10.509 2,570,900 70,500 (formerly T.B. Mining Ventures Inc.) Sphere 3D Corporation Common Shares Inwentash, Sheldon 3 17/11/2014 10 10.397 2,585,300 14,400 (formerly T.B. Mining Ventures Inc.) Sphere 3D Corporation Common Shares Pinetree Capital Ltd. 3 12/11/2014 10 9.85 2,464,000 2,000 (formerly T.B. Mining Ventures Inc.) Sphere 3D Corporation Common Shares Pinetree Capital Ltd. 3 13/11/2014 10 10.563 2,500,400 36,400 (formerly T.B. Mining Ventures Inc.) Sphere 3D Corporation Common Shares Pinetree Capital Ltd. 3 14/11/2014 10 10.509 2,570,900 70,500 (formerly T.B. Mining Ventures Inc.) Sphere 3D Corporation Common Shares Pinetree Capital Ltd. 3 17/11/2014 10 10.397 2,585,300 14,400 (formerly T.B. Mining Ventures Inc.) Spot Coffee (Canada) Ltd. Common Shares AYOUB, ANTON MICHEL 4, 5 17/11/2014 10 0.03 604,458 10,000 Spot Coffee (Canada) Ltd. Common Shares Lorenzo, John Michael 4 19/11/2014 10 0.03 4,436,324 50,000 Sprott Inc. Common Shares Stephens, Paul H. 4 14/11/2014 10 2.531 583,850 12,400 ST ANDREW GOLDFIELDS Common Shares Abramson, Edward 3 17/11/2014 10 0.24 37,625,483 500 LTD. ST ANDREW GOLDFIELDS Common Shares Abramson, Edward 3 17/11/2014 10 0.245 37,639,983 14,500 LTD. ST ANDREW GOLDFIELDS Common Shares Abramson, Edward 3 17/11/2014 10 0.25 37,646,483 6,500 LTD. ST ANDREW GOLDFIELDS Common Shares Abramson, Edward 3 17/11/2014 10 0.255 37,647,483 1,000 LTD. ST ANDREW GOLDFIELDS Common Shares Abramson, Edward 3 18/11/2014 10 0.25 37,657,483 10,000 LTD. ST ANDREW GOLDFIELDS Common Shares Abramson, Edward 3 18/11/2014 10 0.255 37,660,483 3,000 LTD. ST ANDREW GOLDFIELDS Common Shares Abramson, Edward 3 18/11/2014 10 0.26 37,662,483 2,000 LTD. ST ANDREW GOLDFIELDS Common Shares Abramson, Edward 3 19/11/2014 10 0.25 37,665,483 3,000 LTD. ST ANDREW GOLDFIELDS Common Shares Abramson, Edward 3 19/11/2014 10 0.255 37,670,483 5,000 LTD. ST ANDREW GOLDFIELDS Common Shares Abramson, Edward 3 19/11/2014 10 0.26 37,671,483 1,000 LTD. ST ANDREW GOLDFIELDS Common Shares Abramson, Edward 3 20/11/2014 10 0.255 37,673,483 2,000 LTD. ST ANDREW GOLDFIELDS Common Shares Abramson, Edward 3 20/11/2014 10 0.26 37,680,483 7,000 LTD. ST ANDREW GOLDFIELDS Common Shares Abramson, Edward 3 20/11/2014 10 0.265 37,683,483 3,000 LTD. ST ANDREW GOLDFIELDS Common Shares Abramson, Edward 3 21/11/2014 10 0.255 37,685,983 2,500 LTD. ST ANDREW GOLDFIELDS Common Shares Abramson, Edward 3 21/11/2014 10 0.26 37,688,983 3,000 LTD.
November 27, 2014 (2014), 37 OSCB 10640
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Stantec Inc. Common Shares Allen, Richard 7, 5 14/11/2014 37 40,656 20,328 Stantec Inc. Common Shares Allen, Richard 7, 5 14/11/2014 37 11,792 5,896 Performance Share Units Stantec Inc. Common Shares Allen, Richard 7, 5 14/11/2014 37 16,620 8,310 Restricted Share Units Stantec Inc. Options Allen, Richard 7, 5 14/11/2014 37 37,966 18,983 Stantec Inc. Common Shares Alpern, Paul Jeremy David 7, 5 14/11/2014 37 24,528 12,264 Stantec Inc. Common Shares Alpern, Paul Jeremy David 7, 5 14/11/2014 37 1,762 881 Performance Share Units Stantec Inc. Options Alpern, Paul Jeremy David 7, 5 14/11/2014 37 24,180 12,090 Stantec Inc. Common Shares Ammerman, Douglas Keith 4 14/11/2014 37 8,000 4,000 Stantec Inc. Common Shares Deferred Ammerman, Douglas Keith 4 14/11/2014 37 16,256 8,128 Share Units Stantec Inc. Common Shares Emerson, David Lee 4 14/11/2014 37 10,000 5,000 Stantec Inc. Common Shares Deferred Emerson, David Lee 4 14/11/2014 37 31,074 15,537 Share Units Stantec Inc. Common Shares Etter, Delores Maria 4 14/11/2014 37 5,310 2,655 Stantec Inc. Common Shares Deferred Etter, Delores Maria 4 14/11/2014 37 16,256 8,128 Share Units Stantec Inc. Common Shares Franceschini, Anthony P. 4 14/11/2014 37 300,800 150,400 Stantec Inc. Common Shares Deferred Franceschini, Anthony P. 4 14/11/2014 37 31,074 15,537 Share Units Stantec Inc. Common Shares Gomes, Robert 4, 7, 5 14/11/2014 37 34,820 17,410 Stantec Inc. Common Shares Gomes, Robert 4, 7, 5 14/11/2014 37 130,852 65,426 Stantec Inc. Common Shares Gomes, Robert 4, 7, 5 14/11/2014 37 34,448 17,224 Performance Share Units Stantec Inc. Common Shares Deferred Gomes, Robert 4, 7, 5 14/11/2014 37 117,604 58,802 Share Units Stantec Inc. Options Gomes, Robert 4, 7, 5 14/11/2014 37 96,702 48,351 Stantec Inc. Common Shares Hartman, Susan Elaine 4 14/11/2014 37 9,300 4,650 Stantec Inc. Common Shares Deferred Hartman, Susan Elaine 4 14/11/2014 37 60,706 30,353 Share Units Stantec Inc. Common Shares Keith, Aram H. 4, 5 14/11/2014 37 134,324 67,162 Stantec Inc. Common Shares Keith, Aram H. 4, 5 14/11/2014 37 166,000 83,000 Stantec Inc. Common Shares Deferred Keith, Aram H. 4, 5 14/11/2014 37 39,304 19,652 Share Units Stantec Inc. Common Shares Lefaivre, Daniel Joseph 7 14/11/2014 37 4,100 2,050 Stantec Inc. Common Shares Lefaivre, Daniel Joseph 7 14/11/2014 37 15,088 7,544 Stantec Inc. Common Shares Lefaivre, Daniel Joseph 7 14/11/2014 37 28,814 14,407 Stantec Inc. Common Shares Lefaivre, Daniel Joseph 7 14/11/2014 37 6,000 3,000 Stantec Inc. Common Shares Lefaivre, Daniel Joseph 7 14/11/2014 37 7,294 3,647 Performance Share Units Stantec Inc. Common Shares Lefaivre, Daniel Joseph 7 14/11/2014 37 11,480 5,740 Restricted Share Units Stantec Inc. Options Lefaivre, Daniel Joseph 7 14/11/2014 37 47,300 23,650 Stantec Inc. Common Shares LOWRY, Donald James 4 14/11/2014 37 4,000 2,000 Stantec Inc. Common Shares Deferred LOWRY, Donald James 4 14/11/2014 37 4,812 2,406 Share Units Stantec Inc. Common Shares Ruste, Ivor Melvin 4 14/11/2014 37 5,900 2,950 Stantec Inc. Common Shares Deferred Ruste, Ivor Melvin 4 14/11/2014 37 45,892 22,946 Share Units Stantec Inc. Common Shares Stone, Jeffrey Philip 7 14/11/2014 37 348 174 Stantec Inc. Common Shares Stone, Jeffrey Philip 7 14/11/2014 37 1,000 500 Stantec Inc. Options Stone, Jeffrey Philip 7 14/11/2014 37 12,034 6,017 Stella-Jones Inc. Common Shares Eichenbaum, Marla 5 14/11/2014 10 35.45 1,294 -500 Stella-Jones Inc. Common Shares Eichenbaum, Marla 5 17/11/2014 10 36 794 -500 Stella-Jones Inc. Common Shares Eichenbaum, Marla 5 17/11/2014 10 36.05 294 -500 Stella-Jones Inc. Common Shares Eichenbaum, Marla 5 19/11/2014 10 35.173 0 -294 Stella-Jones Inc. Common Shares Poirier, Martin 5 19/11/2014 10 34.96 1,400 -600 Stella-Jones Inc. Common Shares Poirier, Martin 5 19/11/2014 10 34.95 900 -500 Stella-Jones Inc. Common Shares Poirier, Martin 5 19/11/2014 10 34.9 0 -900 Sterling Resources Ltd. Common Shares Ingalls & Snyder, LLC 3 12/11/2014 97 35,909,543 5,000
November 27, 2014 (2014), 37 OSCB 10641
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Sterling Resources Ltd. Common Shares Ingalls & Snyder, LLC 3 13/11/2014 97 35,926,209 16,666 Stonehaven Exploration Ltd. Common Shares Scalf, Murray 4 17/11/2014 10 1.6 121,580 2,500 Stonehaven Exploration Ltd. Common Shares Todd, Malcolm Frederick 4 17/11/2014 10 1.6 130,500 4,400 William Stonehaven Exploration Ltd. Common Shares Todd, Robert Hamish Owen 5 17/11/2014 10 1.6 130,500 5,500 Strata Minerals Inc. Common Shares Agro, Hugh 4 11/11/2014 10 0.08 2,180,708 500 Strike Graphite Corp. Common Shares Kalt, Ryan 3 18/11/2014 10 0.075 3,313,413 1,000 Strike Graphite Corp. Common Shares Kalt, Ryan 3 19/11/2014 10 0.075 3,315,413 2,000 Strike Graphite Corp. Common Shares Kalt, Ryan 3 19/11/2014 10 0.1 3,316,413 1,000 Strike Graphite Corp. Common Shares Kalt, Ryan 3 19/11/2014 10 0.095 3,317,413 1,000 Strike Graphite Corp. Common Shares Kalt, Ryan 3 20/11/2014 10 0.095 3,322,913 5,500 Strike Graphite Corp. Common Shares Kalt, Ryan 3 20/11/2014 10 0.1 3,324,913 2,000 Strike Graphite Corp. Common Shares Kalt, Ryan 3 21/11/2014 10 0.065 3,344,913 20,000 Strike Graphite Corp. Common Shares Kalt, Ryan 3 21/11/2014 10 0.055 3,349,913 5,000 Strongco Corporation Common Shares Bell, John K. 4 21/11/2014 10 2.4 13,900 10,000 Student Transportation Inc. Common Shares SNCF Participations, S.A. 3 15/10/2014 30 6.68 14,188,613 97,760 (formerly, Student Transportation of America Ltd.) Sulliden Mining Capital Inc. Common Shares Pettigrew, Pierre Stewart 4 11/08/2014 00 Sulliden Mining Capital Inc. Common Shares Pettigrew, Pierre Stewart 4 17/11/2014 51 0.31 20,000 20,000 Sulliden Mining Capital Inc. Common Shares Pettigrew, Pierre Stewart 4 17/11/2014 10 0.3526 0 -20,000 Sulliden Mining Capital Inc. Options Pettigrew, Pierre Stewart 4 17/11/2014 51 0.31 90,500 -20,000 SunOpta Inc. Common Shares Routh, Allan Glen 4, 5 19/11/2014 10 12.041 276,829 -10,000 Suparna Gold Corp. Common Shares Tisdale, Wayne 4 14/11/2014 10 0.115 5,383,000 147,000 Suparna Gold Corp. Common Shares Tisdale, Wayne 4 21/11/2014 10 0.11 5,437,000 54,000 Suparna Gold Corp. Common Shares Tisdale, Wayne 4 21/11/2014 10 0.105 5,452,500 15,500 Superior Copper Corporation Common Shares Cudney, Robert Douglas 3 13/11/2014 10 0.035 23,409,000 100,000 Superior Copper Corporation Common Shares Cudney, Robert Douglas 3 17/11/2014 10 0.03 23,609,000 200,000 Superior Copper Corporation Convertible Debentures Cudney, Robert Douglas 3 20/11/2014 11 $0 -$50,000 Superior Plus Corp. Common Shares Wrisley, Keith Allen 7 06/11/2014 10 10.62 0 -3,000 Supreme Pharmaceuticals Common Shares Bechtel, Chris 4 10/11/2014 00 1,700,000 Inc. Supreme Pharmaceuticals Options Bechtel, Chris 4 10/11/2014 00 300,000 Inc. Supreme Pharmaceuticals Warrants exercisable at Bechtel, Chris 4 10/11/2014 00 200,000 Inc. $0.50 per share prior to November 5, 2016 Supreme Pharmaceuticals Warrants exercisable at Bechtel, Chris 4 10/11/2014 00 650,000 Inc. $0.50 per share prior to September 22, 2015 Supremex Inc. Common Shares Clarke Inc. 3 14/11/2014 10 3.2 12,886,300 -8,800 Supremex Inc. Common Shares Clarke Inc. 3 18/11/2014 11 2.905 0 -12,886,300 Supremex Inc. Common Shares The Article 6 Marital Trust 3 20/11/2014 11 2.7 5,487,385 2,000,000 created under the First Amended and Restated Jerry Zucker Revocable Trust dated 4-2-07 Surge Energy Inc. Common Shares Elekes, Margaret Ann 5 18/11/2014 54 5.17 4,907 69 Surge Energy Inc. Common Shares Elekes, Margaret Ann 5 30/09/2014 30 7.42 107,776 270 Surge Energy Inc. Common Shares Elekes, Margaret Ann 5 18/11/2014 54 5.17 118,370 859 Surge Energy Inc. Common Shares Elekes, Margaret Ann 5 18/11/2014 54 5.17 43,916 70 Surge Energy Inc. Common Shares Elekes, Margaret Ann 5 18/11/2014 54 5.17 7,964 84 Surge Energy Inc. Common Shares Elekes, Margaret Ann 5 18/11/2014 54 5.17 6,165 403 Surge Energy Inc. Warrants Elekes, Margaret Ann 5 18/11/2014 54 5.17 28,599 -403 Surge Energy Inc. Warrants Elekes, Margaret Ann 5 18/11/2014 54 5.17 29,707 -69 Surge Energy Inc. Warrants Elekes, Margaret Ann 5 18/11/2014 54 5.17 28,848 -859 Surge Energy Inc. Warrants Elekes, Margaret Ann 5 18/11/2014 53 5.17 28,515 -84 Surge Energy Inc. Warrants Elekes, Margaret Ann 5 18/11/2014 54 5.17 28,445 -70 Surge Energy Inc. Common Shares Lof, Maxwell Andrew 5 18/11/2014 10 6.19 3,518 21 William
November 27, 2014 (2014), 37 OSCB 10642
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Surge Energy Inc. Common Shares Lof, Maxwell Andrew 5 18/11/2014 10 6.19 3,518 21 William Surge Energy Inc. Common Shares Lof, Maxwell Andrew 5 18/11/2014 54 5.17 4,898 74 William Surge Energy Inc. Common Shares Lof, Maxwell Andrew 5 18/11/2014 54 5.17 112,490 443 William Surge Energy Inc. Common Shares Lof, Maxwell Andrew 5 18/11/2014 54 5.17 113,067 216 William Surge Energy Inc. Common Shares Lof, Maxwell Andrew 5 18/11/2014 54 5.17 4,681 72 William Surge Energy Inc. Warrants Lof, Maxwell Andrew 5 18/11/2014 54 5.17 33,474 -72 William Surge Energy Inc. Warrants Lof, Maxwell Andrew 5 18/11/2014 54 5.17 33,258 -216 William Surge Energy Inc. Warrants Lof, Maxwell Andrew 5 18/11/2014 54 5.17 51,056 -443 William Surge Energy Inc. Warrants Lof, Maxwell Andrew 5 18/11/2014 54 5.17 50,982 -74 William Synex International Inc. Common Shares Stephens, Alan William 4, 5 21/11/2014 10 0.49 265,500 -7,000 TAG Oil Ltd Common Shares TAG Oil Ltd. 1 14/11/2014 10 1.51 840,100 623,200 Tahoe Resources Inc. Common Shares McArthur, C. Kevin 4 17/11/2014 10 19.22 3,733,824 -88,400 Tahoe Resources Inc. Common Shares McArthur, C. Kevin 4 18/11/2014 10 19.4 3,636,824 -97,000 Tahoe Resources Inc. Common Shares McArthur, C. Kevin 4 19/11/2014 10 18.9 3,473,924 -162,900 Tahoe Resources Inc. Common Shares McArthur, C. Kevin 4 20/11/2014 10 19.04 3,389,724 -84,200 Tahoe Resources Inc. Common Shares McArthur, C. Kevin 4 20/11/2014 10 19.35 -94,166 Tahoe Resources Inc. Common Shares McArthur, C. Kevin 4 21/11/2014 10 19.35 3,295,558 -94,166 Tahoe Resources Inc. Common Shares Rovig, A. Dan 4, 6 17/11/2014 51 6.4 120,000 50,000 Tahoe Resources Inc. Options Rovig, A. Dan 4, 6 17/11/2014 51 30,000 -50,000 Tarku Resources Ltd. Common Shares MacNeill, Tom 4 17/11/2014 10 0.05 706,000 5,000 (formerly ITUNA Capital Corporation) Tarku Resources Ltd. Common Shares MacNeill, Tom 4 18/11/2014 10 0.05 726,000 20,000 (formerly ITUNA Capital Corporation) Tarku Resources Ltd. Common Shares MacNeill, Tom 4 19/11/2014 10 0.05 738,000 12,000 (formerly ITUNA Capital Corporation) TELUS Corporation Common Shares Arora, Navin 5 08/05/2014 00 TELUS Corporation Common Shares Arora, Navin 5 20/11/2014 51 16.31 6,619 6,619 TELUS Corporation Common Shares Arora, Navin 5 20/11/2014 10 43.66 4,200 -2,419 TELUS Corporation Common Shares Arora, Navin 5 20/11/2014 10 43.69 3,700 -500 TELUS Corporation Common Shares Arora, Navin 5 20/11/2014 10 43.68 1,700 -2,000 TELUS Corporation Common Shares Arora, Navin 5 20/11/2014 10 43.67 0 -1,700 TELUS Corporation Options Arora, Navin 5 20/11/2014 51 16.31 19,992 -10,576 TELUS Corporation Common Shares Day, Stockwell 4 10/11/2014 30 41.23 3,055 30 TELUS Corporation Common Shares Day, Stockwell 4 10/11/2014 30 41.23 3,279 224 TELUS Corporation Common Shares Mercier, Monique 5 19/11/2014 51 23.24 2,694 2,694 TELUS Corporation Common Shares Mercier, Monique 5 19/11/2014 10 43.64 1,347 -1,347 TELUS Corporation Common Shares Mercier, Monique 5 19/11/2014 10 43.61 1,022 -325 TELUS Corporation Options Mercier, Monique 5 19/11/2014 51 23.24 2,879 -2,879 TELUS Corporation Options Mercier, Monique 5 19/11/2014 51 23.24 0 -2,879 Tembec Inc. Options Dumas, Michel 4, 5 17/11/2014 52 133.09 12,227 -1,315 Tembec Inc. Options Lopez, Jim 4, 5 17/11/2014 52 133.09 14,685 -1,127 Tembec Inc. Options Norris, Stephen J. 5 17/11/2014 52 133.09 1,714 -180 Temple Hotels Inc. Common Shares Thorsteinson, Arni Clayton 4, 5 13/11/2014 10 3.68 807,437 2,600 Temple Hotels Inc. Common Shares Thorsteinson, Arni Clayton 4, 5 13/11/2014 10 3.69 809,537 2,100 Temple Hotels Inc. Common Shares Thorsteinson, Arni Clayton 4, 5 13/11/2014 10 3.7 811,237 1,700 Temple Hotels Inc. Common Shares Thorsteinson, Arni Clayton 4, 5 13/11/2014 10 3.71 812,037 800 Temple Hotels Inc. Common Shares Thorsteinson, Arni Clayton 4, 5 13/11/2014 10 3.72 829,837 17,800 Temple Hotels Inc. Common Shares Thorsteinson, Arni Clayton 4, 5 17/11/2014 10 3.94 2,964,021 15,500 Temple Hotels Inc. Common Shares Thorsteinson, Arni Clayton 4, 5 17/11/2014 10 3.85 2,974,021 10,000 Temple Hotels Inc. Common Shares Thorsteinson, Arni Clayton 4, 5 20/11/2014 30 3.6861 2,976,237 2,216
November 27, 2014 (2014), 37 OSCB 10643
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Terra Energy Corp. Common Shares Penner, Robert David 4 18/11/2014 10 0.25 388,200 80,000 Tesco Corporation Common Shares Assing, Fernando Rafael 5 14/11/2014 10 15.665 231,182 -3,213 Tesco Corporation Common Shares Ferris, Mihial Dean 5 14/11/2014 10 15.765 7,092 -1,358 Tesco Corporation Common Shares Quintana, Julio Manuel 4, 5 14/11/2014 10 15.704 239,249 -8,985 THE CALDWELL Deferred Stock Units Daoust, Paul 4 20/11/2014 30 23,407 3,385 PARTNERS INTERNATIONAL INC. THE CALDWELL Deferred Stock Units Innes, Richard Dent 4 20/11/2014 30 23,407 3,385 PARTNERS INTERNATIONAL INC. THE CALDWELL Deferred Stock Units KING, GEORGE EDMUND 4 20/11/2014 30 32,185 4,654 PARTNERS INTERNATIONAL INC. THE CALDWELL Deferred Stock Units Welsh, Kathryn A. 4 20/11/2014 30 23,407 3,385 PARTNERS INTERNATIONAL INC. The Intertain Group Limited Common Shares Choi, Brent 4 20/11/2014 54 5 19,125 625 The Intertain Group Limited Warrants Choi, Brent 4 11/02/2014 00 625 The Intertain Group Limited Warrants Choi, Brent 4 20/11/2014 54 5 0 -625 The Intertain Group Limited Common Shares Danziger, David 4 19/11/2014 54 5 36,875 1,625 The Intertain Group Limited Warrants Danziger, David 4 19/11/2014 54 5 0 -1,625 The Intertain Group Limited Common Shares DUNFORD, STANLEY 4 21/11/2014 54 5 98,125 15,625 GEORGE The Intertain Group Limited Warrants DUNFORD, STANLEY 4 21/11/2014 54 5 0 -15,625 GEORGE The Intertain Group Limited Common Shares Fielding, John David 4 10/07/2014 11 7 150,000 The Intertain Group Limited Common Shares Fielding, John David 4 10/07/2014 11 7 150,000 The Intertain Group Limited Common Shares Fielding, John David 4 10/09/2014 10 8.769 100,000 The Intertain Group Limited Common Shares Fielding, John David 4 11/02/2014 00 The Intertain Group Limited Common Shares Fielding, John David 4 10/07/2014 11 7 150,000 150,000 The Intertain Group Limited Common Shares Fielding, John David 4 10/09/2014 10 8.769 250,000 100,000 The Intertain Group Limited Common Shares Fielding, John David 4 19/11/2014 54 7.75 287,500 37,500 The Intertain Group Limited Warrants Fielding, John David 4 11/02/2014 00 The Intertain Group Limited Warrants Fielding, John David 4 10/07/2014 53 37,500 37,500 The Intertain Group Limited Warrants Fielding, John David 4 19/11/2014 54 7.75 0 -37,500 The Intertain Group Limited Common Shares FITZGERALD, JOHN 4, 5 19/11/2014 54 5 520,198 21,875 KENNEDY The Intertain Group Limited Common Shares FITZGERALD, JOHN 4, 5 19/11/2014 54 7.75 600,198 80,000 KENNEDY The Intertain Group Limited Warrants FITZGERALD, JOHN 4, 5 19/11/2014 54 5 80,000 -21,875 KENNEDY The Intertain Group Limited Warrants FITZGERALD, JOHN 4, 5 19/11/2014 54 7.75 0 -80,000 KENNEDY The Intertain Group Limited Common Shares Laslop, Keith 5 20/11/2014 54 7.75 410,277 20,000 The Intertain Group Limited Common Shares Laslop, Keith 5 20/11/2014 54 5 416,527 6,250 The Intertain Group Limited Warrants Laslop, Keith 5 20/11/2014 54 7.75 6,250 -20,000 The Intertain Group Limited Warrants Laslop, Keith 5 20/11/2014 51 5 0 -6,250 The Intertain Group Limited Common Shares Pathak, Sumesh Paul 4 16/09/2011 00 The Intertain Group Limited Common Shares Pathak, Sumesh Paul 4 19/11/2014 54 5 1,575 The Intertain Group Limited Common Shares Pathak, Sumesh Paul 4 19/11/2014 54 5 22,875 1,575 The Intertain Group Limited Warrants Pathak, Sumesh Paul 4 19/11/2014 54 5 0 -1,575 The Intertain Group Limited Common Shares Redmond, Mark Laurence 4 21/11/2014 54 5 27,812 1,562 The Intertain Group Limited Common Shares Redmond, Mark Laurence 4 21/11/2014 54 7.75 31,812 4,000 The Intertain Group Limited Warrants Redmond, Mark Laurence 4 21/11/2014 54 5 4,000 -1,562 The Intertain Group Limited Warrants Redmond, Mark Laurence 4 21/11/2014 54 7.75 0 -4,000 The Jean Coutu Group (PJC) Options Belzile, André 5 14/11/2014 51 13.07 70,571 -24,495 Inc. The Jean Coutu Group (PJC) Options Belzile, André 5 14/11/2014 51 14.87 55,801 -14,770 Inc. The Jean Coutu Group (PJC) Subordinate Voting Belzile, André 5 14/11/2014 51 13.07 57,185 24,495 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Belzile, André 5 14/11/2014 51 14.87 71,955 14,770 Inc. Shares Catégorie A
November 27, 2014 (2014), 37 OSCB 10644
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed The Jean Coutu Group (PJC) Subordinate Voting Belzile, André 5 14/11/2014 10 26.697 37,105 -34,850 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Belzile, André 5 14/11/2014 10 26.84 36,905 -200 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Belzile, André 5 14/11/2014 10 26.83 36,805 -100 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Belzile, André 5 14/11/2014 10 26.82 36,705 -100 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Belzile, André 5 14/11/2014 10 26.81 36,605 -100 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Belzile, André 5 14/11/2014 10 26.8 36,505 -100 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Belzile, André 5 14/11/2014 10 26.84 35,905 -600 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Belzile, André 5 14/11/2014 10 26.83 35,605 -300 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Belzile, André 5 14/11/2014 10 26.82 35,505 -100 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Belzile, André 5 14/11/2014 10 26.81 35,305 -200 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Belzile, André 5 14/11/2014 10 26.8 33,990 -1,315 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Belzile, André 5 14/11/2014 10 26.84 33,890 -100 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Belzile, André 5 14/11/2014 10 26.83 33,790 -100 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Belzile, André 5 14/11/2014 10 26.8 32,690 -1,100 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Rights à la plus-value des Coutu, François Jean 4, 5 14/11/2014 59 17.24 270,134 -172,272 Inc. actions The Jean Coutu Group (PJC) Options Dufour, Brigitte 5 14/11/2014 51 14.87 11,250 -6,150 Inc. The Jean Coutu Group (PJC) Subordinate Voting Dufour, Brigitte 5 27/04/2011 00 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Dufour, Brigitte 5 14/11/2014 51 14.87 6,150 6,150 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Dufour, Brigitte 5 14/11/2014 10 26.65 922 -5,228 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Options Franche, Guy 5 14/11/2014 51 13.24 19,471 -6,045 Inc. The Jean Coutu Group (PJC) Options Franche, Guy 5 14/11/2014 51 15.04 15,831 -3,640 Inc. The Jean Coutu Group (PJC) Subordinate Voting Franche, Guy 5 14/11/2014 51 13.24 6,045 6,045 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Franche, Guy 5 14/11/2014 51 15.04 9,685 3,640 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Franche, Guy 5 14/11/2014 10 26.74 8,985 -700 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Franche, Guy 5 14/11/2014 10 26.72 8,785 -200 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Franche, Guy 5 14/11/2014 10 26.71 7,985 -800 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Franche, Guy 5 14/11/2014 10 26.7 7,285 -700 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Franche, Guy 5 14/11/2014 10 26.69 6,885 -400 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Franche, Guy 5 14/11/2014 10 26.74 6,785 -100 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Franche, Guy 5 14/11/2014 10 26.72 6,085 -700 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Franche, Guy 5 14/11/2014 10 26.7 5,885 -200 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Franche, Guy 5 14/11/2014 10 26.69 5,585 -300 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Franche, Guy 5 14/11/2014 10 26.69 5,285 -300 Inc. Shares Catégorie A
November 27, 2014 (2014), 37 OSCB 10645
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed The Jean Coutu Group (PJC) Subordinate Voting Franche, Guy 5 14/11/2014 10 26.67 4,985 -300 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Franche, Guy 5 14/11/2014 10 26.68 4,085 -900 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Franche, Guy 5 14/11/2014 10 26.67 1,906 -2,179 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Franche, Guy 5 14/11/2014 10 26.7 1,706 -200 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Franche, Guy 5 14/11/2014 10 26.69 1,606 -100 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Options Messier, Normand 5 17/11/2014 51 13.07 61,544 -21,368 Inc. The Jean Coutu Group (PJC) Options Messier, Normand 5 17/11/2014 51 14.87 48,664 -12,880 Inc. The Jean Coutu Group (PJC) Options Messier, Normand 5 17/11/2014 51 18.6 43,326 -5,338 Inc. The Jean Coutu Group (PJC) Subordinate Voting Messier, Normand 5 17/11/2014 51 13.07 23,868 21,368 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Messier, Normand 5 17/11/2014 51 14.87 36,748 12,880 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Messier, Normand 5 17/11/2014 51 18.6 42,086 5,338 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Messier, Normand 5 17/11/2014 10 27.18 41,486 -600 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Messier, Normand 5 17/11/2014 10 27.17 41,386 -100 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Messier, Normand 5 17/11/2014 10 27.17 41,286 -100 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Messier, Normand 5 17/11/2014 10 27.16 41,086 -200 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Messier, Normand 5 17/11/2014 10 27.15 40,686 -400 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Messier, Normand 5 17/11/2014 10 27.17 40,086 -600 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Messier, Normand 5 17/11/2014 10 27.16 39,986 -100 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Messier, Normand 5 17/11/2014 10 27.15 39,886 -100 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Messier, Normand 5 17/11/2014 10 27.15 38,586 -1,300 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Messier, Normand 5 17/11/2014 10 27.15 38,086 -500 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Messier, Normand 5 17/11/2014 10 27.125 36,986 -1,100 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Messier, Normand 5 17/11/2014 10 27.12 36,786 -200 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Messier, Normand 5 17/11/2014 10 27.12 36,486 -300 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Messier, Normand 5 17/11/2014 10 27.12 36,086 -400 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Messier, Normand 5 17/11/2014 10 27.09 35,886 -200 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Messier, Normand 5 17/11/2014 10 27.09 35,086 -800 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Messier, Normand 5 17/11/2014 10 27.1 34,086 -1,000 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Messier, Normand 5 17/11/2014 10 27.16 33,786 -300 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Messier, Normand 5 17/11/2014 10 27.15 32,286 -1,500 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Messier, Normand 5 17/11/2014 10 27.15 32,086 -200 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Messier, Normand 5 17/11/2014 10 27.22 31,586 -500 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Messier, Normand 5 17/11/2014 10 27.16 31,386 -200 Inc. Shares Catégorie A
November 27, 2014 (2014), 37 OSCB 10646
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed The Jean Coutu Group (PJC) Subordinate Voting Messier, Normand 5 17/11/2014 10 27.21 31,286 -100 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Messier, Normand 5 17/11/2014 10 27.15 30,886 -400 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Messier, Normand 5 17/11/2014 10 27.21 30,086 -800 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Messier, Normand 5 17/11/2014 10 27.21 29,186 -900 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Messier, Normand 5 17/11/2014 10 27.14 29,086 -100 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Messier, Normand 5 17/11/2014 10 27.21 9,957 -19,129 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Messier, Normand 5 17/11/2014 10 27.16 9,857 -100 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Messier, Normand 5 17/11/2014 10 27.16 9,657 -200 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Messier, Normand 5 17/11/2014 10 27.16 9,457 -200 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Messier, Normand 5 17/11/2014 10 27.16 9,057 -400 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Messier, Normand 5 17/11/2014 10 27.15 8,957 -100 Inc. Shares Catégorie A The Jean Coutu Group (PJC) Subordinate Voting Messier, Normand 5 17/11/2014 10 27.16 8,757 -200 Inc. Shares Catégorie A The Westaim Corporation Common Shares Andrus, William Ruel 7 31/07/2014 00 20,000 The Westaim Corporation Restricted Share Units Andrus, William Ruel 7 31/07/2014 00 The Westaim Corporation Restricted Share Units Andrus, William Ruel 7 14/11/2014 11 175,000 175,000 The Westaim Corporation Restricted Share Units Delaney, Ian William 4, 5 03/06/2003 00 The Westaim Corporation Restricted Share Units Delaney, Ian William 4, 5 14/11/2014 11 450,000 450,000 The Westaim Corporation Restricted Share Units Kittel, Robert Terrance 5 28/02/2013 00 The Westaim Corporation Restricted Share Units Kittel, Robert Terrance 5 14/11/2014 11 700,000 700,000 The Westaim Corporation Restricted Share Units MacDonald, J. Cameron 3, 4 19/12/2008 00 The Westaim Corporation Restricted Share Units MacDonald, J. Cameron 3, 4 14/11/2014 11 900,000 900,000 Thompson Creek Metals Options Ramey, Geoffrey 5 15/09/2014 00 Company Inc. Thompson Creek Metals Options Ramey, Geoffrey 5 19/11/2014 50 50,000 50,000 Company Inc. Thomson Reuters Common Shares Craig, David William Ian 7, 5 01/01/2011 00 Corporation Thomson Reuters Common Shares Craig, David William Ian 7, 5 01/01/2012 00 Corporation Thomson Reuters Common Shares Craig, David William Ian 7, 5 01/01/2012 00 220 Corporation Thomson Reuters Common Shares Craig, David William Ian 7, 5 01/01/2011 00 Corporation Thomson Reuters Common Shares Craig, David William Ian 7, 5 01/01/2012 00 Corporation Thomson Reuters Common Shares Craig, David William Ian 7, 5 01/01/2012 00 10,074 Corporation Tim Hortons Inc. Common Shares Anthony, Douglas G. 7, 5 17/11/2014 57 92.32 3,744 722 Tim Hortons Inc. Restricted Stock Units Anthony, Douglas G. 7, 5 17/11/2014 57 1,023 -1,184 Tim Hortons Inc. Common Shares Blackmore, David J.G. 7, 5 17/11/2014 57 92.32 4,217 735 Tim Hortons Inc. Restricted Stock Units Blackmore, David J.G. 7, 5 17/11/2014 57 1,243 -1,456 Tim Hortons Inc. Common Shares Bonikowsky, Scott 5 17/11/2014 57 92.32 2,299 598 Tim Hortons Inc. Restricted Stock Units Bonikowsky, Scott 5 17/11/2014 57 1,023 -1,184 Tim Hortons Inc. Common Shares Clanachan, David F. 5 17/11/2014 57 92.32 60,311 2,522 Tim Hortons Inc. Common Shares Clanachan, David F. 5 17/11/2014 57 92.32 60,834 523 Tim Hortons Inc. Restricted Stock Units Clanachan, David F. 5 17/11/2014 57 6,152 -4,996 Tim Hortons Inc. Restricted Stock Units Clanachan, David F. 5 17/11/2014 57 5,115 -1,037 Tim Hortons Inc. Common Shares Devine, Cynthia Jane 5 17/11/2014 57 92.32 95,400 3,026 Tim Hortons Inc. Restricted Stock Units Devine, Cynthia Jane 5 17/11/2014 57 5,115 -5,995 Tim Hortons Inc. Common Shares Fife, Diana 5 17/11/2014 57 92.32 3,735 734 Tim Hortons Inc. Restricted Stock Units Fife, Diana 5 17/11/2014 57 1,243 -1,456
November 27, 2014 (2014), 37 OSCB 10647
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Tim Hortons Inc. Common Shares Fraser, Garry 7, 5 17/11/2014 57 92.32 3,971 294 Tim Hortons Inc. Restricted Stock Units Fraser, Garry 7, 5 17/11/2014 57 499 -582 Tim Hortons Inc. Common Shares Hardman, Stephanie 7, 5 17/11/2014 57 92.32 602 187 Tim Hortons Inc. Restricted Stock Units Hardman, Stephanie 7, 5 17/11/2014 57 823 -370 Tim Hortons Inc. Common Shares Hemeon, John M. 5 17/11/2014 57 92.32 1,633 1,513 Tim Hortons Inc. Restricted Stock Units Hemeon, John M. 5 17/11/2014 57 2,131 -2,997 Tim Hortons Inc. Common Shares Henderson, Kenneth 7, 5 17/11/2014 57 92.32 1,007 1,007 Tim Hortons Inc. Restricted Stock Units Henderson, Kenneth 7, 5 17/11/2014 57 823 -1,995 Tim Hortons Inc. Common Shares Hollis, Glenn O. 7, 5 17/11/2014 57 92.32 1,423 735 Tim Hortons Inc. Restricted Stock Units Hollis, Glenn O. 7, 5 17/11/2014 57 1,243 -1,456 Tim Hortons Inc. Common Shares Holly, Mark 7, 5 17/11/2014 57 92.32 1,806 187 Tim Hortons Inc. Restricted Stock Units Holly, Mark 7, 5 17/11/2014 57 823 -370 Tim Hortons Inc. Common Shares House, Paul 4 17/11/2014 57 92.32 134,257 38 Tim Hortons Inc. Common Shares House, Paul 4 17/11/2014 57 92.32 134,266 9 Tim Hortons Inc. Common Shares House, Paul 4 17/11/2014 57 92.32 144,352 10,086 Tim Hortons Inc. Common Shares House, Paul 4 17/11/2014 57 92.32 147,554 3,202 Tim Hortons Inc. Restricted Stock Units House, Paul 4 17/11/2014 57 55,613 -74 Tim Hortons Inc. Restricted Stock Units House, Paul 4 17/11/2014 57 55,594 -19 Tim Hortons Inc. Restricted Stock Units House, Paul 4 17/11/2014 57 35,609 -19,985 Tim Hortons Inc. Restricted Stock Units House, Paul 4 17/11/2014 57 29,265 -6,344 Tim Hortons Inc. Common Shares Javor, Nikola S. 5 17/11/2014 57 92.32 11,248 735 Tim Hortons Inc. Restricted Stock Units Javor, Nikola S. 5 17/11/2014 57 1,242 -1,456 Tim Hortons Inc. Common Shares Kipker, Mira 7 17/11/2014 57 92.32 4,003 249 Tim Hortons Inc. Restricted Stock Units Kipker, Mira 7 17/11/2014 57 1,691 -370 Tim Hortons Inc. Common Shares McKay, W. David 7, 5 17/11/2014 57 92.32 724 187 Tim Hortons Inc. Restricted Stock Units McKay, W. David 7, 5 17/11/2014 57 823 -370 Tim Hortons Inc. Common Shares McMullen, David H. 7, 5 17/11/2014 57 92.32 8,253 453 Tim Hortons Inc. Restricted Stock Units McMullen, David H. 7, 5 17/11/2014 57 766 -897 Tim Hortons Inc. Common Shares Meilleur, Mike 5 17/11/2014 57 92.32 7,338 978 Tim Hortons Inc. Common Shares Meilleur, Mike 5 17/11/2014 57 92.32 7,745 407 Tim Hortons Inc. Restricted Stock Units Meilleur, Mike 5 17/11/2014 57 2,097 -1,456 Tim Hortons Inc. Restricted Stock Units Meilleur, Mike 5 17/11/2014 57 1,492 -605 Tim Hortons Inc. Common Shares Michetti, Meredith 5 17/11/2014 57 92.32 4,452 453 Tim Hortons Inc. Restricted Stock Units Michetti, Meredith 5 17/11/2014 57 766 -897 Tim Hortons Inc. Common Shares Myskiw, Michael J. 5 17/11/2014 57 92.32 3,267 453 Tim Hortons Inc. Restricted Stock Units Myskiw, Michael J. 5 17/11/2014 57 1,041 -897 Tim Hortons Inc. Common Shares Nadeau, Michael G. 7, 5 17/11/2014 57 92.32 3,076 450 Tim Hortons Inc. Restricted Stock Units Nadeau, Michael G. 7, 5 17/11/2014 57 1,041 -897 Tim Hortons Inc. Common Shares Phillips, Gordon J. 7, 5 17/11/2014 57 92.32 1,845 187 Tim Hortons Inc. Restricted Stock Units Phillips, Gordon J. 7, 5 17/11/2014 57 823 -370 Tim Hortons Inc. Common Shares Piggot, Cara M. 7, 5 17/11/2014 57 92.32 2,829 453 Tim Hortons Inc. Restricted Stock Units Piggot, Cara M. 7, 5 17/11/2014 57 1,041 -897 Tim Hortons Inc. Common Shares Sutton, Jill E. 5 17/11/2014 57 92.32 2,604 996 Tim Hortons Inc. Restricted Stock Units Sutton, Jill E. 5 17/11/2014 57 1,704 -1,972 Tim Hortons Inc. Common Shares Walton, Roland M. 5 17/11/2014 57 92.32 75,910 2,521 Tim Hortons Inc. Restricted Stock Units Walton, Roland M. 5 17/11/2014 57 4,263 -4,996 Tim Hortons Inc. Common Shares Wettlaufer, Michelle 5 17/11/2014 57 92.32 3,734 735 Tim Hortons Inc. Restricted Stock Units Wettlaufer, Michelle 5 17/11/2014 57 1,243 -1,456 Tim Hortons Inc. Common Shares Wisch, Gesa 7, 5 17/11/2014 57 92.32 1,634 735 Tim Hortons Inc. Restricted Stock Units Wisch, Gesa 7, 5 17/11/2014 57 1,243 -1,456 Timbercreek Mortgage Common Shares Tamblyn, Robert Blair 4 19/11/2014 10 8.45 12,657 1,000 Investment Corporation Timbercreek Mortgage Common Shares Timbercreek Asset 2 19/11/2014 10 8.5 88,490 1,000 Investment Corporation Management Inc. Titan Medical Inc. Common Shares Hargrove, John Townley 4 18/11/2014 10 1.25 148,200 60,000 TitanStar Properties Inc. Common Shares Turner, Thomas Richard 4, 5 17/11/2014 10 0.09 4,709,371 1,000 (formerly DPVC Inc.) TitanStar Properties Inc. Common Shares Turner, Thomas Richard 4, 5 17/11/2014 10 0.09 4,709,571 200 (formerly DPVC Inc.)
November 27, 2014 (2014), 37 OSCB 10648
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed TMX Group Limited Options Eccleston, Louis 4, 5 03/11/2014 00 TMX Group Limited Options Eccleston, Louis 4, 5 17/11/2014 50 53 135,000 135,000 TORC Oil & Gas Ltd. Common Shares Canada Pension Plan 3 17/11/2014 35 1,516,196 100,880 Investment Board Torex Gold Resources Inc. Common Shares Stanford, Frederick McLae 4, 5 14/11/2014 57 250,690 12,000 Torex Gold Resources Inc. Rights Restricted Share Stanford, Frederick McLae 4, 5 14/11/2014 57 1,834,310 -12,000 Units (“RSU's”) Toromont Industries Ltd. Common Shares McLeod, Steven Douglas 5 19/11/2014 51 16.76 64,500 6,000 Toromont Industries Ltd. Common Shares McLeod, Steven Douglas 5 19/11/2014 10 28.54 63,500 -1,000 Toromont Industries Ltd. Common Shares McLeod, Steven Douglas 5 19/11/2014 10 28.53 63,400 -100 Toromont Industries Ltd. Common Shares McLeod, Steven Douglas 5 19/11/2014 10 28.5 62,800 -600 Toromont Industries Ltd. Common Shares McLeod, Steven Douglas 5 19/11/2014 10 28.49 62,100 -700 Toromont Industries Ltd. Common Shares McLeod, Steven Douglas 5 19/11/2014 10 28.48 61,800 -300 Toromont Industries Ltd. Common Shares McLeod, Steven Douglas 5 19/11/2014 10 28.47 61,500 -300 Toromont Industries Ltd. Common Shares McLeod, Steven Douglas 5 19/11/2014 10 28.4 58,500 -3,000 Toromont Industries Ltd. Common Shares McLeod, Steven Douglas 5 20/11/2014 51 16.76 6,000 Toromont Industries Ltd. Options McLeod, Steven Douglas 5 19/11/2014 51 16.76 79,000 -6,000 Total Energy Services Inc. Common Shares Melchin, Gregory Knowles 4 14/11/2014 10 18.708 34,868 908 Touchstone Exploration Inc. Common Shares Baay, Paul Raymond 4, 5 17/11/2014 30 0.57 877,973 2,523 Touchstone Exploration Inc. Common Shares Budau, Christopher Scott 5 17/11/2014 30 0.57 57,512 1,977 Touchstone Exploration Inc. Common Shares McKINNON, KENNETH 4 17/11/2014 30 0.57 142,422 731 RICHARD Touchstone Exploration Inc. Common Shares Mitzel, Trevor 4 17/11/2014 30 0.57 51,669 1,462 Touchstone Exploration Inc. Common Shares Ruttan, Corey Christopher 4, 5 17/11/2014 30 0.57 223,598 1,462 Touchstone Exploration Inc. Common Shares Shipka, James 5 17/11/2014 30 0.57 71,633 1,726 Touchstone Exploration Inc. Common Shares Smith, Richard Gregg 4 17/11/2014 30 0.57 195,970 1,462 Tourmaline Oil Corp. Options Kirker, William Scott 5 15/11/2014 50 42.78 215,000 20,000 Tourmaline Oil Corp. Common Shares Riddell, Clayton H. 4 19/11/2014 10 41.9 25,000 5,000 TransCanada Corporation Common Shares Bennett, Terry J. 7 17/11/2014 10 57.13 0 -1,351 TransCanada Corporation Common Shares Jacobucci, Robert C. 7 14/11/2014 30 52.71 388 200 TransCanada Corporation Common Shares Jacobucci, Robert C. 7 14/11/2014 30 52.88 398 10 TransCanada Corporation Common Shares Jacobucci, Robert C. 7 14/11/2014 10 55.68 142 -256 TransCanada Corporation Common Shares SOINI, JOHN F. 7 19/11/2014 30 52.7 1,879 109 TransCanada Corporation Common Shares SOINI, JOHN F. 7 19/11/2014 30 52.2 1,951 72 TransCanada Corporation Common Shares SOINI, JOHN F. 7 19/11/2014 10 57.54 1,776 -175 TransGlobe Energy Common Shares Gress, Albert 5 18/11/2014 10 3.89 45,614 4,000 Corporation TransGlobe Energy Common Shares Neely, Randy 5 17/11/2014 10 4.3 25,300 10,000 Corporation Traverse Energy Ltd. Common Shares Erickson, David Henry 3, 4, 5 18/11/2014 10 0.9 2,717,539 500 Traverse Energy Ltd. Common Shares Erickson, David Henry 3, 4, 5 18/11/2014 10 0.95 2,747,039 29,500 Traverse Energy Ltd. Common Shares Erickson, David Henry 3, 4, 5 20/11/2014 10 0.87 2,762,039 15,000 Traverse Energy Ltd. Common Shares smith, laurie james 3, 4, 5 18/11/2014 10 0.94 5,409,800 5,000 Traverse Energy Ltd. Common Shares smith, laurie james 3, 4, 5 20/11/2014 10 0.84 5,417,300 7,500 Treasury Metals Inc. Common Shares Ferron, Greg 5 14/11/2014 10 0.28 184,100 5,000 Tree Island Steel Ltd. Common Shares Bull, Peter Morris 3 23/01/2014 36 0.5 9,188,800 Tree Island Steel Ltd. Common Shares Bull, Peter Morris 3 23/01/2014 36 0.5 4,188,800 Tree Island Steel Ltd. Common Shares Bull, Peter Morris 3 23/01/2014 36 0.5 9,499,800 9,188,800 Tree Island Steel Ltd. Common Shares Bull, Peter Morris 3 16/05/2014 37 4,749,900 -4,749,900 Tree Island Steel Ltd. Common Shares Bull, Peter Morris 3 18/11/2014 54 1.14 5,548,650 798,750 Tree Island Steel Ltd. Warrants Bull, Peter Morris 3 18/11/2014 36 -1,597,500 Tree Island Steel Ltd. Warrants Bull, Peter Morris 3 18/11/2014 54 0 -1,597,500 Trez Capital Mortgage Class A Shares Greene, Morley 3 21/10/2014 30 8.2274 24,862 174 Investment Corporation Trez Capital Mortgage Class A Shares Lai, Kenty Hin-Fai 3 21/10/2014 30 8.2274 24,862 174 Investment Corporation Trez Capital Mortgage Class A Shares Manson, Alexander Maxwell 3, 4, 5 21/10/2014 30 8.2274 24,862 174 Investment Corporation Trez Capital Mortgage Class A Shares Nisker, Michael John 3, 4, 5 21/10/2014 30 8.2274 24,862 174 Investment Corporation Richard
November 27, 2014 (2014), 37 OSCB 10649
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Trez Capital Mortgage Class A Shares Perkins, Robert Derek 3 21/10/2014 30 8.2274 24,862 174 Investment Corporation Trez Capital Senior Mortgage Class A Shares Greene, Morley 3 21/10/2014 30 8.2963 33,738 182 Investment Corporation Trez Capital Senior Mortgage Class A Shares Greene, Morley 3 21/11/2014 30 8.2963 182 Investment Corporation Trez Capital Senior Mortgage Class A Shares Greene, Morley 3 21/11/2014 30 8.2963 182 Investment Corporation Trez Capital Senior Mortgage Class A Shares Lai, Kenty Hin-Fai 3 21/10/2014 30 8.2963 33,738 182 Investment Corporation Trez Capital Senior Mortgage Class A Shares Manson, Alexander Maxwell 3, 4, 5 21/10/2014 30 8.2963 33,738 182 Investment Corporation Trez Capital Senior Mortgage Class A Shares Nisker, Michael John 3, 4, 5 21/10/2014 30 8.2963 33,738 182 Investment Corporation Richard Trez Capital Senior Mortgage Class A Shares Perkins, Robert Derek 3 21/10/2014 30 8.2963 33,738 182 Investment Corporation Trican Well Service Ltd. Common Shares NUGENT, Kevin 4 19/11/2014 10 9.26 7,585 200 Trican Well Service Ltd. Common Shares NUGENT, Kevin 4 19/11/2014 10 9.25 9,885 2,300 Trican Well Service Ltd. Rights Restricted Share Wichuk, Randal Bernard 2 21/11/2014 56 12,244 33 Units (RSUs) Trican Well Service Ltd. Rights Restricted Share Wichuk, Randal Bernard 2 21/11/2014 59 10.07 11,433 -811 Units (RSUs) TriMetals Mining Inc. Common Shares Fitch, Ralph Gordon 4, 5 14/11/2014 10 0.1 4,075,533 8,500 TriMetals Mining Inc. Common Shares Fitch, Ralph Gordon 4, 5 14/11/2014 10 0.12 4,085,533 10,000 TriMetals Mining Inc. Common Shares Fitch, Ralph Gordon 4, 5 14/11/2014 10 0.11 4,105,533 20,000 TriMetals Mining Inc. Common Shares Fitch, Ralph Gordon 4, 5 17/11/2014 10 0.12 4,155,533 50,000 TriMetals Mining Inc. Options with tandem Fitch, Ralph Gordon 4, 5 14/11/2014 50 470,000 250,000 share appreciation right TriMetals Mining Inc. Options with tandem Haber, Paul 4 13/11/2014 50 175,000 share appreciation right TriMetals Mining Inc. Options with tandem Haber, Paul 4 13/11/2014 50 175,000 share appreciation right TriMetals Mining Inc. Options with tandem Haber, Paul 4 13/11/2014 50 291,875 175,000 share appreciation right TriMetals Mining Inc. Options with tandem MALBRAN, Felipe Bernardo 5 14/11/2014 50 125,000 125,000 share appreciation right TriMetals Mining Inc. Options with tandem Mironchik, Roman 4 14/11/2014 50 125,000 125,000 share appreciation right TriMetals Mining Inc. Options with tandem Moore, Randall 5 14/11/2014 50 400,000 125,000 share appreciation right TriMetals Mining Inc. Options with tandem Sheehan, Paul 4 14/11/2014 50 425,000 125,000 share appreciation right TriMetals Mining Inc. Options with tandem Teja, Muqit 4 14/11/2014 50 425,000 125,000 share appreciation right TriMetals Mining Inc. Options with tandem Woodside, Tina Mercedes 4 14/11/2014 50 291,875 175,000 share appreciation right Trinidad Drilling Ltd. Common Shares Halford, David William 4 18/11/2014 10 10,000 3,000 Turquoise Hill Resources Common Shares Gill, James Wendell 4 01/11/2014 00 Ltd. Turquoise Hill Resources Common Shares Gill, James Wendell 4 19/11/2014 00 Ltd. Turquoise Hill Resources TRQ Deferred Share Unit Gill, James Wendell 4 01/11/2014 00 Ltd. Turquoise Hill Resources TRQ Deferred Share Unit Gill, James Wendell 4 17/11/2014 56 3.62 14,230 14,230 Ltd. Turquoise Hill Resources TRQ Deferred Share Unit Gill, James Wendell 4 19/11/2014 00 Ltd. Turquoise Hill Resources TRQ Deferred Share Unit Gill, James Wendell 4 19/11/2014 00 Ltd. Twin Butte Energy Ltd. Common Shares Howe, Gordon 5 17/11/2014 35 1.419 79,490 259 Twin Butte Energy Ltd. Common Shares SAUNDERS, JAMES 4, 5 17/11/2014 35 1.419 5,336,106 1,272 MACLEO Twin Butte Energy Ltd. Common Shares Steckley, Warren D. 4 17/11/2014 35 1.419 272,366 655 Twin Butte Energy Ltd. Common Shares Steele, Alan 5 17/11/2014 35 1.419 1,267,715 1,580 Umbral Energy Corp. Common Shares Bal, Jagdip 4 14/10/2014 10 0.055 1,414,693 -270,000
November 27, 2014 (2014), 37 OSCB 10650
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Umbral Energy Corp. Common Shares Bal, Jagdip 4 17/11/2014 51 0.06 1,552,693 243,000 Umbral Energy Corp. Common Shares Sharples, Clint 4 21/11/2014 10 0.045 715,000 50,000 Uni-Sélect Inc. Common Shares Dulac, Jean 4 14/11/2014 10 28 818,000 -8,600 Uni-Sélect Inc. Common Shares Dulac, Jean 4 17/11/2014 10 28 816,400 -1,600 Uni-Sélect Inc. Common Shares Dulac, Jean 4 18/11/2014 10 28 814,100 -2,300 Uni-Sélect Inc. Common Shares Dulac, Jean 4 19/11/2014 10 28 809,900 -4,200 Uni-Sélect Inc. Common Shares Uni-Sélect Inc. 1 14/11/2014 38 27.981 5,715 5,715 Uni-Sélect Inc. Common Shares Uni-Sélect Inc. 1 14/11/2014 38 27.981 0 -5,715 Uni-Sélect Inc. Common Shares Uni-Sélect Inc. 1 17/11/2014 38 27.978 4,000 4,000 Uni-Sélect Inc. Common Shares Uni-Sélect Inc. 1 17/11/2014 38 27.978 0 -4,000 Uni-Sélect Inc. Common Shares Uni-Sélect Inc. 1 18/11/2014 38 27.947 3,000 3,000 Uni-Sélect Inc. Common Shares Uni-Sélect Inc. 1 18/11/2014 38 27.947 0 -3,000 Uni-Sélect Inc. Common Shares Uni-Sélect Inc. 1 19/11/2014 38 27.967 5,700 5,700 Uni-Sélect Inc. Common Shares Uni-Sélect Inc. 1 19/11/2014 38 27.967 0 -5,700 Uni-Sélect Inc. Common Shares Uni-Sélect Inc. 1 20/11/2014 38 27.978 3,800 3,800 Uni-Sélect Inc. Common Shares Uni-Sélect Inc. 1 20/11/2014 38 27.978 0 -3,800 Unique Broadband Systems, Common Shares Morrison, Robert John 3 14/11/2014 10 0.005 13,085,000 5,000 Inc. Unique Broadband Systems, Common Shares Morrison, Robert John 3 17/11/2014 10 0.005 13,445,000 360,000 Inc. Unique Broadband Systems, Common Shares Morrison, Robert John 3 19/11/2014 10 0.005 13,461,000 16,000 Inc. UNISYNC Corp. Common Shares Class B Eddy, Darryl 4 21/11/2014 10 1.7 124,934 41,600 Voting Shares UNISYNC Corp. Non-Voting Shares Class Eddy, Darryl 4 21/11/2014 10 1.7 706,938 58,400 A Restricted Equity Shares UpSnap, Inc. Options Howard, Bruce Carl 4 06/02/2014 00 UpSnap, Inc. Options Howard, Bruce Carl 4 13/11/2014 50 1,000,000 1,000,000 UpSnap, Inc. Options Lambert, David Wayne 4 04/02/2014 00 UpSnap, Inc. Options Lambert, David Wayne 4 13/11/2014 50 1,000,000 1,000,000 UpSnap, Inc. Options Pekurar, Aurel Alexandru 5 13/11/2014 50 1,271,400 500,000 Urbanimmersive Options Asselin, Jean 5 13/11/2014 50 32,500 20,000 Technologies Inc. Urbanimmersive Options Drouin, Charles 4 13/11/2014 50 75,000 75,000 Technologies Inc. Urbanimmersive Options Lemire, Ghislain 4, 5 13/11/2014 50 212,500 200,000 Technologies Inc. Urbanimmersive Options McDonald, James 4 13/11/2014 50 270,000 75,000 Technologies Inc. Urbanimmersive Options Plamondon, Pierre 4 13/11/2014 50 150,000 50,000 Technologies Inc. Urbanimmersive Options Robidoux, Daniel 4 13/11/2014 50 333,000 50,000 Technologies Inc. Urbanimmersive Options Thibault, Martin 7 13/11/2014 50 82,500 70,000 Technologies Inc. Urbanimmersive Options Vincent, Olivier 4 13/11/2014 50 150,000 50,000 Technologies Inc. Valhalla Resources Ltd. Common Shares Harkness, William Scott 3 14/11/2014 00 400,000 Valhalla Resources Ltd. Common Shares Harkness, William Scott 3 14/11/2014 00 230,000 Valhalla Resources Ltd. Common Shares Harkness, William Scott 3 14/11/2014 00 4,162,500 Valhalla Resources Ltd. Common Shares Harkness, William Scott 3 14/11/2014 00 100,000 Vela Minerals Ltd. Common Shares Chebry, Charles Richard 3, 4 20/11/2014 10 0.025 4,485,000 5,000 Village Farms International, Common Shares Ruffini, Stephen 5 18/11/2014 10 0.9525 89,600 6,000 Inc. Village Farms International, Common Shares Ruffini, Stephen 5 18/11/2014 10 0.95 40,800 3,000 Inc. Village Farms International, Common Shares Ruffini, Stephen 5 21/11/2014 10 0.95 45,800 5,000 Inc. Visible Gold Mines Inc. Common Shares McEwen, Robert R. 6 17/11/2014 00 Visible Gold Mines Inc. Common Shares McEwen, Robert R. 6 17/11/2014 10 0.1281 394,500 394,500 Vista Gold Corp. RSU Earnest, Frederick H. 5 17/11/2014 58 - Expiration 1,079,495 -300,000 of rights
November 27, 2014 (2014), 37 OSCB 10651
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Vista Gold Corp. Common Shares Rozelle, John W. 5 17/11/2014 57 39,971 32,477 Vista Gold Corp. RSU Rozelle, John W. 5 17/11/2014 57 429,887 -32,477 Vista Gold Corp. RSU Rozelle, John W. 5 17/11/2014 58 - Expiration 412,364 -17,523 of rights Vista Gold Corp. RSU Rozelle, John W. 5 17/11/2014 58 - Expiration 374,864 -37,500 of rights Wajax Corporation Rights Directors' Deferred Barrett, Edward Malcolm 4 20/11/2014 56 35.44 25,711 144 Share Unit Plan Wajax Corporation Rights Directors' Deferred Bourne, Ian Alexander 4 20/11/2014 56 35.44 14,895 84 Share Unit Plan Wajax Corporation Rights Directors' Deferred Carty, Douglas 4 20/11/2014 56 35.44 8,240 46 Share Unit Plan Wajax Corporation Rights Directors' Deferred Dexter, Robert P. 4 20/11/2014 56 35.44 57,225 321 Share Unit Plan Wajax Corporation Rights Share Ownership Dyck, Brian 5 20/11/2014 56 35.44 8,963 50 Plan Wajax Corporation Rights Directors' Deferred Eby, John Clifford 4 20/11/2014 56 35.44 15,854 89 Share Unit Plan Wajax Corporation Rights Share Ownership Foote, Alan Mark 4 20/11/2014 56 35.44 16,994 95 Plan Wajax Corporation Rights Directors' Deferred Gagne, Paul Ernest 4 20/11/2014 56 35.44 38,992 219 Share Unit Plan Wajax Corporation Rights Share Ownership Hamilton, John Joseph 5 20/11/2014 56 35.44 24,974 140 Plan Wajax Corporation Rights Directors' Deferred Hole, James Douglas 4 20/11/2014 56 35.44 28,123 158 Share Unit Plan Wajax Corporation Rights Directors' Deferred Taylor, Alexander S. 4 20/11/2014 56 35.44 8,743 49 Share Unit Plan Waldron Energy Corporation Common Shares Collins, James William 3 17/11/2014 10 0.1966 906,000 15,500 Waldron Energy Corporation Common Shares Collins, James William 3 19/11/2014 10 0.1873 986,000 80,000 West Red Lake Gold Mines Common Shares Meredith, Thomas Wright 4 17/11/2014 10 0.04 1,608,467 30,000 Inc.(Formerly Hy Lake Gold Inc.) Western Forest Products Inc. Options Williams, Stephen D.A. 5 31/10/2014 00 Western Forest Products Inc. Options Williams, Stephen D.A. 5 31/10/2014 50 2.34 300,000 300,000 Western Potash Corp. Common Shares Hui, Wang 4, 6 14/11/2014 00 45,040,876 WesternOne Inc. Common Shares Evans, Steve 4 14/11/2014 10 4.67 174,857 2,800 WesternOne Inc. Common Shares Evans, Steve 4 14/11/2014 10 4.62 174,957 100 WesternOne Inc. Common Shares Evans, Steve 4 14/11/2014 10 4.64 177,757 2,800 WesternOne Inc. Common Shares Evans, Steve 4 14/11/2014 10 4.63 177,857 100 WesternOne Inc. Common Shares Evans, Steve 4 14/11/2014 10 4.61 178,857 1,000 WesternOne Inc. Common Shares Evans, Steve 4 14/11/2014 10 4.6 182,357 3,500 WesternOne Inc. Common Shares Evans, Steve 4 17/11/2014 10 4.6927 187,857 5,500 WesternOne Inc. Common Shares Evans, Steve 4 17/11/2014 10 4.7 192,357 4,500 WesternOne Inc. Common Shares Greig, Andrew David 5 20/11/2014 10 4.19 10,102 500 Gilmour WesternOne Inc. Common Shares Greig, Andrew David 5 20/11/2014 10 4.2 10,602 500 Gilmour WesternOne Inc. Common Shares Greig, Andrew David 5 20/11/2014 10 4.22 11,977 1,375 Gilmour WesternOne Inc. Common Shares King, Robert William 4, 5 14/11/2014 10 4.58 13,657 10,000 WesternOne Inc. Common Shares McAleer, Ronald James 5 14/11/2014 10 4.69 15,186 3,240 WesternOne Inc. Common Shares Yam, Carlos 5 18/11/2014 10 4.75 70,057 1,000 WesternZagros Resources Common Shares Boone, David J. 4 14/11/2014 57 0.65 135,000 21,821 Ltd. WesternZagros Resources Rights Boone, David J. 4 14/11/2014 57 0.65 86,136 -27,043 Ltd. WesternZagros Resources Rights Boone, David J. 4 18/11/2014 52 -86,136 Ltd. WesternZagros Resources Rights Boone, David J. 4 18/11/2014 58 - Expiration 0 -86,136 Ltd. of rights WesternZagros Resources Class A Preferred Shares, Crest Energy International 3 18/03/2013 00 Ltd. Series 1 LLC WesternZagros Resources Class A Preferred Shares, Crest Energy International 3 18/11/2014 16 0.65 274,755,015 274,755,015 Ltd. Series 1 LLC
November 27, 2014 (2014), 37 OSCB 10652
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed WesternZagros Resources Common Shares Crest Energy International 3 18/11/2014 57 0.65 101,867,066 7,868,629 Ltd. LLC WesternZagros Resources Rights Crest Energy International 3 14/11/2014 57 0.65 84,247,002 -9,751,435 Ltd. LLC WesternZagros Resources Rights Crest Energy International 3 14/11/2014 58 - Expiration 0 -84,247,002 Ltd. LLC of rights WesternZagros Resources Rights Dyment, Fred J. 4 18/11/2014 58 - 0.65 0 -392,987 Ltd. Expir ation of rights WesternZagros Resources Rights Frangos, John 4 18/11/2014 58 - 0.65 0 -10,464,385 Ltd. Expir ation of rights WesternZagros Resources Common Shares Hatfield, Malcolm Simon 4, 5 14/11/2014 57 0.65 905,144 243,689 Ltd. WesternZagros Resources Rights Hatfield, Malcolm Simon 4, 5 14/11/2014 57 0.65 359,455 -302,000 Ltd. WesternZagros Resources Rights Hatfield, Malcolm Simon 4, 5 18/11/2014 58 - 0.65 0 -359,455 Ltd. Expir ation of rights WesternZagros Resources Rights Houck, James Curtis 4 18/11/2014 58 - 0.65 0 -497,962 Ltd. Expir ation of rights WesternZagros Resources Common Shares Oliphant, Randall 4 14/11/2014 57 0.65 759,856 339,330 Ltd. WesternZagros Resources Rights Oliphant, Randall 4 14/11/2014 57 0.65 0 -420,526 Ltd. WesternZagros Resources Rights Stevenson, Gregory 5 18/11/2014 58 - 0.65 68 -146,984 Ltd. Chester Expir ation of rights WesternZagros Resources Rights Stevenson, Gregory 5 18/11/2014 58 - 0.65 0 -68 Ltd. Chester Expir ation of rights WesternZagros Resources Rights Stevenson, Gregory 5 18/11/2014 58 - 0.65 0 -400 Ltd. Chester Expir ation of rights WesternZagros Resources Rights Stevenson, Gregory 5 18/11/2014 58 - 0.65 0 -2,889 Ltd. Chester Expir ation of rights WesternZagros Resources Rights Stevenson, Gregory 5 18/11/2014 58 - 0.65 0 -1,094 Ltd. Chester Expir ation of rights WesternZagros Resources Rights Wallace, William 4 18/11/2014 58 - 0.65 0 -55,000 Ltd. Expir ation of rights WestJet Airlines Ltd. Common Shares - Voting Beddoe, Clive 5 17/11/2014 10 31 989,355 -85,200 WestJet Airlines Ltd. Common Shares - Voting Culmone, Vito 5 17/11/2014 10 31.03 27,045 -3,000 WestJet Airlines Ltd. Common Shares - Voting Cummings, Robert 5 17/11/2014 10 31.15 19,251 -7,300 WestJet Airlines Ltd. Common Shares - Voting Matthews, Wilmot Leslie 4 17/11/2014 47 97,921 -3,400 WestJet Airlines Ltd. Common Shares - Voting Matthews, Wilmot Leslie 4 17/11/2014 47 86,621 -11,300 WestJet Airlines Ltd. Common Shares - Voting Matthews, Wilmot Leslie 4 17/11/2014 47 85,651 -970 WestJet Airlines Ltd. Common Shares - Voting Matthews, Wilmot Leslie 4 18/11/2014 47 85,221 -430
November 27, 2014 (2014), 37 OSCB 10653
Insider Reporting
Issuer Name Security Insider Name Rel'n Transaction Date T/O Unit Date/Month End Acquired/ Price Holdings Disposed Wi-LAN Inc. Common Shares Vladescu, Michael 5 14/11/2014 30 2.925 65,400 1,300 X-Terra Resources Inc. Common Shares Champagne, Sylvain 4, 5 14/11/2014 10 0.11 29,500 2,500 Xenon Pharmaceuticals Inc. Options Azab, Mohammad 4 05/11/2014 00 55,962 Yangarra Resources Ltd. Common Shares Bowerman, Gordon 4 14/11/2014 10 1.57 2,965,680 15,000 Yangarra Resources Ltd. Warrants Bowerman, Gordon 4 13/11/2014 11 100,000 100,000 Yangarra Resources Ltd. Warrants Evaskevich, James Grant 4, 5 13/11/2014 11 125,000 -208,334 Yangarra Resources Ltd. Warrants Evaskevich, James Grant 4, 5 13/11/2014 11 75,000 75,000 Yellow Media Limited Deferred Share Unit Kudzman, Susan 4 15/10/2014 56 14.707 920 Yellow Media Limited Deferred Share Unit Kudzman, Susan 4 15/10/2014 56 18.844 718 718 Yellow Media Limited Deferred Share Unit Kudzman, Susan 4 15/10/2014 56 14.707 5,099 Yellow Media Limited Deferred Share Unit Kudzman, Susan 4 15/10/2014 56 18.844 4,698 3,980 Yellow Media Limited Deferred Share Unit Kudzman, Susan 4 15/10/2014 56 14.707 1,204 Yellow Media Limited Deferred Share Unit Kudzman, Susan 4 15/10/2014 56 18.844 5,637 939 ZCL Composites Inc. Common Shares Demuth, Katherine Lynne 5 20/11/2014 10 3.87 15,500 10,000 ZCL Composites Inc. Common Shares Demuth, Katherine Lynne 5 20/11/2014 10 6.82 8,562 -6,938 ZCL Composites Inc. Options Demuth, Katherine Lynne 5 20/11/2014 51 3.87 135,000 -10,000
November 27, 2014 (2014), 37 OSCB 10654
Chapter 8
Notice of Exempt Financings
REPORT OF TRADES ON FORM 45-106F1 AND 45-501F1
There are no Reports of Exempt Distribution on Forms 45-106F1 or 45-501F1 (Reports) in this Bulletin.
Reports filed on or after February 19, 2014 must be filed electronically.
As a result of the transition to mandated electronic filings, the OSC is considering the most effective manner to make data about filed Reports available to the public, including whether and how this information should be reflected in the Bulletin. In the meantime, Reports filed with the Commission continue to be available for public inspection during normal business hours.
November 27, 2014 (2014), 37 OSCB 10655
Notice of Exempt Financings
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November 27, 2014 (2014), 37 OSCB 10656
Chapter 11
IPOs, New Issues and Secondary Financings
Issuer Name: Issuer Name: Allied Properties Real Estate Investment Trust Chemtrade Logistics Income Fund Principal Regulator - Ontario Principal Regulator - Ontario Type and Date: Type and Date: Preliminary Base Shelf Prospectus dated November 19, Preliminary Short Form Prospectus dated November 21, 2014 2014 NP 11-202 Receipt dated November 19, 2014 NP 11-202 Receipt dated November 21, 2014 Offering Price and Description: Offering Price and Description: $1,000,000,000 $100,110,000 - 4,700,000 Units Debt Securities Price: $21.30 per Offered Unit Units Underwriter(s) or Distributor(s): Underwriter(s) or Distributor(s): BMO NESBITT BURNS INC. - SCOTIA CAPITAL INC. Promoter(s): CIBC WORLD MARKETS INC. - NATIONAL BANK FINANCIAL INC. Project #2281070 TD SECURITIES INC. RBC DOMINION SECURITIES INC. ______GMP SECURITIES L.P. Issuer Name: RAYMOND JAMES LTD. Arsenal Energy Inc. Promoter(s): Principal Regulator - Alberta - Type and Date: Project #2280492 Preliminary Short Form Prospectus dated November 21, 2014 ______NP 11-202 Receipt dated November 21, 2014 Issuer Name: Offering Price and Description: DH Corporation $7,959,005 - 799,900 Flow-Through Shares Principal Regulator - Ontario Price: $9.95 per Flow-Through Share Type and Date: Underwriter(s) or Distributor(s): Preliminary Short Form Prospectus dated November 18, PARADIGM CAPITAL INC. 2014 ACUMEN CAPITAL FINANCE PARTNERS LIMITED NP 11-202 Receipt dated November 18, 2014 NATIONAL BANK FINANCIAL INC. Offering Price and Description: INDUSTRIAL ALLIANCE SECURITIES INC. $175,087,500 - 4,830,000 Common Shares Promoter(s): Price: $36.25 per Common Share - Underwriter(s) or Distributor(s): Project #2282302 CIBC WORLD MARKETS INC. TD SECURITIES INC. ______BMO NESBITT BURNS INC. RBC DOMINION SECURITIES INC. SCOTIA CAPITAL INC. NATIONAL BANK FINANCIAL INC. CREDIT SUISSE SECURITIES (CANADA), INC. DESJARDINS SECURITIES INC. RAYMOND JAMES LTD. GMP SECURITIES L.P. INDUSTRIAL ALLIANCE SECURITIES INC. Promoter(s): - Project #2278535
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November 27, 2014 (2014), 37 OSCB 10657
IPOs, New Issues and Secondary Financings
Issuer Name: Issuer Name: First Asset Active Credit ETF GoGold Resources Inc. Principal Regulator - Ontario Principal Regulator - Nova Scotia Type and Date: Type and Date: Preliminary Long Form Prospectus dated November 14, Preliminary Short Form Prospectus dated November 18, 2014 2014 NP 11-202 Receipt dated November 20, 2014 NP 11-202 Receipt dated November 18, 2014 Offering Price and Description: Offering Price and Description: Common Units, Advisor Class Unit, US$ Common Units C$20,000,250 - 13,333,500 Common Shares and US$ Advisor Class Unit Price: C$1.50 per Offered Share Underwriter(s) or Distributor(s): Underwriter(s) or Distributor(s): - CORMARK SECURITIES INC. Promoter(s): BMO NESBITT BURNS INC. FIRST ASSET INVESTMENT MANAGEMENT INC PI FINANCIAL CORP. Project #2281418 Promoter(s): - ______Project #2280755 Issuer Name: First Asset Active Utility & Infrastructure ETF ______Principal Regulator - Ontario Issuer Name: Type and Date: IGM Financial Inc. Preliminary Long Form Prospectus dated November 17, Principal Regulator - Manitoba 2014 Type and Date: NP 11-202 Receipt dated November 18, 2014 Preliminary Base Shelf Prospectus dated November 19, Offering Price and Description: 2014 Common Units and Advisor Class Units NP 11-202 Receipt dated November 19, 2014 Underwriter(s) or Distributor(s): Offering Price and Description: - $3,000,000,000 Promoter(s): Debt Securities (unsecured) FIRST ASSET INVESTMENT MANAGEMENT INC. First Preferred Shares Project #2280662 Common Shares Subscription Receipts ______Underwriter(s) or Distributor(s): Issuer Name: - First Asset Core Balanced ETF Promoter(s): First Asset Core Canadian Equity ETF - First Asset Core U.S. Equity ETF Project #2280972 Principal Regulator - Ontario Type and Date: ______Preliminary Long Form Prospectus dated November 18, Issuer Name: 2014 IA Clarington Growth & Income Fund NP 11-202 Receipt dated November 18, 2014 IA Clarington North American Opportunities Class Offering Price and Description: Principal Regulator - Quebec Common Units, Advisor Class Units, Unhedged Common Type and Date: Units, US$ Unhedged Common Units, Unhedged Advisor Preliminary Simplified Prospectuses dated November 17, Class Units and US$ Unhedged Advisor Class Units 2014 Underwriter(s) or Distributor(s): NP 11-202 Receipt dated November 21, 2014 - Offering Price and Description: Promoter(s): Offering Series A, E, E5, F, F5, L, L5, P, P5, and T5 FIRST ASSET INVESTMENT MANAGEMENT INC. securities Project #2280707 Underwriter(s) or Distributor(s): - ______Promoter(s): IA Clarington Investments Inc. Project #2281320
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November 27, 2014 (2014), 37 OSCB 10658
IPOs, New Issues and Secondary Financings
Issuer Name: Issuer Name: Lysander Corporate Value Bond Fund Melcor Real Estate Investment Trust Lysander U.S. Credit Fund Principal Regulator - Alberta 18 Asset Management All-Cap Canadian Equity Fund Type and Date: Crusader Equity Income Fund Preliminary Short Form Prospectus dated November 18, Lysander-Seamark Balanced Fund 2014 Lysander-Seamark Total Equity Fund NP 11-202 Receipt dated November 18, 2014 Lysander-Slater Preferred Share Dividend Fund Offering Price and Description: Principal Regulator - Ontario $30,000,000 - 5.50% Extendible Convertible Unsecured Type and Date: Subordinated Debentures Preliminary Simplified Prospectuses dated November 19, Pice: $1,000 per Debenture 2014 Underwriter(s) or Distributor(s): NP 11-202 Receipt dated November 20, 2014 RBC Dominion Securities Inc. Offering Price and Description: CIBC World Markets Inc. Series A, F, O, A5 and F5 Units TD Securities Inc. Underwriter(s) or Distributor(s): Desjardins Securities Inc. - National Bank Financial Inc. Promoter(s): Scotia Capital Inc. Lysander Funds Limited Canaccord Genuity Corp. Project #2281216 Laurentian Bank Securities Inc. Raymond James Ltd. ______Promoter(s): Issuer Name: - Maple Leaf 2014-II Flow-Through Limited Partnership - Project #2277847 National Class Maple Leaf 2014-II Flow-Through Limited Partnership - ______Quebec Class Issuer Name: Principal Regulator - British Columbia Nautilus Minerals Inc. Type and Date: Principal Regulator - British Columbia Amended and Restated Preliminary Long Form Prospectus Type and Date: dated November 17, 2014 Preliminary Base Shelf Prospectus dated November 18, NP 11-202 Receipt dated November 18, 2014 2014 Offering Price and Description: NP 11-202 Receipt dated November 19, 2014 Maximum: $10,000,000 - 400,000 Maple Leaf 2014-II Flow- Offering Price and Description: Through Limited Partnership – National Class Units Cdn$500,000,000 Price per Unit: $25.00 COMMON SHARES Minimum Purchase: $5,000 (200 Units) WARRANTS Underwriter(s) or Distributor(s): DEBT SECURITIES SCOTIA CAPITAL INC. Underwriter(s) or Distributor(s): CIBC WORLD MARKETS INC. - NATIONAL BANK FINANCIAL INC. Promoter(s): BMO NESBITTBURNS INC. - GMP SECURITIES L.P. Project #2280966 CANACCORD GENUITY CORP. RAYMOND JAMES LTD. ______DESJARDINS SECURITIES INC. MANULIFE SECURITIES INCORPORATED BURGEONVEST BICK SECURITIES LIMITED DUNDEE SECURITIES LTD. GLOBAL SECURITIES CORPORATION Promoter(s): CADO BANCORP LTD. MAPLE LEAF 2014-II FLOW-THROUGH MANAGEMENT CORP. Project #2265389;2265392
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November 27, 2014 (2014), 37 OSCB 10659
IPOs, New Issues and Secondary Financings
Issuer Name: Issuer Name: NYX Gaming Group Limited Union Gas Limited Principal Regulator - Ontario Principal Regulator - Ontario Type and Date: Type and Date: Preliminary Long Form Prospectus dated November 21, Preliminary Base Shelf Prospectus dated November 21, 2014 2014 NP 11-202 Receipt dated November 21, 2014 NP 11-202 Receipt dated November 21, 2014 Offering Price and Description: Offering Price and Description: $ * - * Shares $1,500,000,000 - MEDIUM TERM NOTE DEBENTURES Price: $ * per Share (UNSECURED) Underwriter(s) or Distributor(s): Underwriter(s) or Distributor(s): CANACCORD GENUITY CORP. BMO Nesbitt Burns Inc. CORMARK SECURITIES INC. CIBC World Markets Inc. NATIONAL BANK FINANCIAL INC. Scotia Capital Inc. DUNDEE SECURITIES LTD. TD Securities Inc. GLOBAL MAXFIN CAPITAL INC. Promoter(s): MACKIE RESEARCH CAPITAL CORPORATION - Promoter(s): Project #2282144 - Project #2282101 ______Issuer Name: ______Westcoast Energy Inc. Issuer Name: Principal Regulator - British Columbia Painted Pony Petroleum Ltd. Type and Date: Principal Regulator - Alberta Preliminary Base Shelf Prospectus dated November 21, Type and Date: 2014 Preliminary Short Form Prospectus dated November 18, NP 11-202 Receipt dated November 21, 2014 2014 Offering Price and Description: NP 11-202 Receipt dated November 18, 2014 $1,000,000,000 - MEDIUM TERM NOTE DEBENTURES Offering Price and Description: (UNSECURED) $55,044,000 - 4,587,000 Common Shares Underwriter(s) or Distributor(s): Price: $12.00 per Common Share BMO Nesbitt Burns Inc. Underwriter(s) or Distributor(s): CIBC World Markets Inc. Cormark Securities Inc. Scotia Capital Inc. FirstEnergy Capital Corp. TD Securities Inc. Canaccord Genuity Corp. Promoter(s): RBC Dominion Securities Inc. - TD Securities Inc. Project #2282229 AltaCorp Capital Inc. CIBC World Markets Inc. ______Scotia Capital Inc. Issuer Name: National Bank Financial Inc. Phillips, Hager & North High Yield Bond Fund Promoter(s): Principal Regulator - Ontario - Type and Date: Project #2280166 Amendment #3 dated November 17, 2014 to the Annual Information Form dated June 27, 2014 ______NP 11-202 Receipt dated November 21, 2014 Issuer Name: Offering Price and Description: Riley Resources Corp. Series C, Advisor Series, Series D, Series F and Series O Principal Regulator - British Columbia units Type and Date: Underwriter(s) or Distributor(s): Preliminary CPC Prospectus dated November 20, 2014 Phillips, Hager & North Investment Funds Ltd. NP 11-202 Receipt dated November 20, 2014 Promoter(s): Offering Price and Description: RBC Global Asset Management Inc. $200,000.00 - 2,000,000 Common Shares Project #2211271; 2211275 Price: $0.10 per Common Share Underwriter(s) or Distributor(s): ______HAYWOOD SECURITIES INC. Promoter(s): Todd L. Hilditch Project #2281869
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November 27, 2014 (2014), 37 OSCB 10660
IPOs, New Issues and Secondary Financings
Issuer Name: Issuer Name: Brandes Canadian Money Market Fund (Class A units and InnVest Real Estate Investment Trust Class F units) Principal Regulator - Ontario Brandes Global Balanced Fund (Class A units, Class F Type and Date: units, Class K units, Final Short Form Prospectus dated November 19, 2014 Class L units, Class M units, Class W units and Class I NP 11-202 Receipt dated November 19, 2014 units) Offering Price and Description: Sionna Canadian Balanced Fund (Class A units, Class AN $63,262,500 units, Class F units, Class FN units, 12,050,000 Units Class K units, Class L units, Class M units, Class W units $5.25 per Unit and Class I units) Underwriter(s) or Distributor(s): Sionna Monthly Income Fund (Class A units, Class AN RBC DOMINION SECURITIES INC. units, Class F units, BMO NESBITT BURNS INC. Class FN units, Class K units, Class L units, Class M units CIBC WORLD MARKETS INC. and Class I units) SCOTIA CAPITAL INC. Principal Regulator - Ontario TD SECURITIES INC. Type and Date: CANACCORD GENUITY CORP. Amendment #1 dated November 7, 2014 to the Simplified Promoter(s): Prospectuses dated May 12, 2014 - NP 11-202 Receipt dated November 21, 2014 Project #2275964 Offering Price and Description: - ______Underwriter(s) or Distributor(s): Issuer Name: - iShares Alternatives Completion Portfolio Builder Fund Promoter(s): iShares Conservative Core Portfolio Builder Fund Brandes Investments Partners & Co. iShares Global Completion Portfolio Builder Fund Project #2190946 iShares Growth Core Portfolio Builder Fund Principal Regulator - Ontario ______Type and Date: Issuer Name: Final Long Form Prospectus dated November 20, 2014 Healthcare Leaders Income Fund NP 11-202 Receipt dated November 21, 2014 Principal Regulator - Ontario Offering Price and Description: Type and Date: Units @ net asset value Final Long Form Prospectus dated November 19, 2014 Underwriter(s) or Distributor(s): NP 11-202 Receipt dated November 20, 2014 Blackrock Asset Management Canada Limited Offering Price and Description: Promoter(s): Maximum: $150,000,000 - 15,000,000 Units @ $10 per unit - Minimum: $2,000 - 200 Units @ $10 per unit Project #2268699 Underwriter(s) or Distributor(s): BMO Nesbitt Burns Inc. ______CIBC World Markets Inc. Scotia Capital Inc. National Bank Financial Inc. Canaccord Genuity Corp. Global Securities Corporation GMP Securities L.P. Raymond James Ltd. Desjardins Securities Inc. Dundee Securities Ltd. Industrial Alliance Securities Inc. Mackie Research Capital Corporation Manulife Securities Incorporated Promoter(s): Harvest Portfolios Group Inc. Project #2271827
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November 27, 2014 (2014), 37 OSCB 10661
IPOs, New Issues and Secondary Financings
Issuer Name: Issuer Name: Maple Leaf 2014-II Flow-Through Limited Partnership - Paramount Resources Ltd. National Class Principal Regulator - Alberta Maple Leaf 2014-II Flow-Through Limited Partnership - Type and Date: Quebec Class Final Base Shelf Prospectus dated November 20, 2014 Principal Regulator - British Columbia NP 11-202 Receipt dated November 20, 2014 Type and Date: Offering Price and Description: Final Long Form Prospectus dated November 20, 2014 $800,000,000 NP 11-202 Receipt dated November 21, 2014 Debt Securities Offering Price and Description: Class A Common Shares $10,000,000 (Maximum) Subscription Receipts (400,000 Maple Leaf 2014-II Flow-Through Limited Warrants Partnership – National Class Units) Units Price per Unit: $25.00 Underwriter(s) or Distributor(s): Minimum Purchase: $5,000 (200 Units) - Underwriter(s) or Distributor(s): Promoter(s): SCOTIA CAPITAL INC. - CIBC WORLD MARKETS INC. Project #2279785 NATIONAL BANK FINANCIAL INC. BMO NESBITTBURNS INC. ______GMP SECURITIES L.P. Issuer Name: CANACCORD GENUITY CORP. Pattern Energy Group Inc. RAYMOND JAMES LTD. Principal Regulator - Ontario DESJARDINS SECURITIES INC. Type and Date: MANULIFE SECURITIES INCORPORATED Final MJDS Prospectus dated November 21, 2014 BURGEONVEST BICK SECURITIES LIMITED NP 11-202 Receipt dated November 21, 2014 DUNDEE SECURITIES LTD. Offering Price and Description: GLOBAL SECURITIES CORPORATION Class A Common Stock Promoter(s): Preferred Stock CADO BANCORP LTD. Debt Securities MAPLE LEAF 2014-II FLOW-THROUGH MANAGEMENT Warrants CORP. Purchase Contracts Project #2265389; 2265392 Subscription Receipts Units ______Underwriter(s) or Distributor(s): Issuer Name: - NorthWest International Healthcare Properties Real Estate Promoter(s): Investment Trust - Principal Regulator - Ontario Project #2266686 Type and Date: Final Short Form Prospectus dated November 18, 2014 ______NP 11-202 Receipt dated November 18, 2014 Offering Price and Description: $30,001,100.00 13,954,000 Units Price: $2.15 per Unit Underwriter(s) or Distributor(s): National Bank Financial Inc. GMP Securities L.P. BMO Nesbitt Burns Inc. Canaccord Genuity Corp. Scotia Capital Inc. Dundee Securities Ltd. Raymond James Ltd. Manulife Securities Incorporated Laurentian Bank Securities Inc. Mackie Research Capital Corporation All Group Financial Services Inc. Promoter(s): - Project #2274991
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November 27, 2014 (2014), 37 OSCB 10662
IPOs, New Issues and Secondary Financings
Issuer Name: Issuer Name: RBC Emerging Markets Foreign Exchange Fund (Series O TELUS Corporation Units only) Principal Regulator - British Columbia RBC Conservative Growth & Income Fund (Series A, Type and Date: Advisor Series, Advisor T5 Series, Final Base Shelf Prospectus dated November 19, 2014 Series T5, Series H, Series F, Series FT5, Series I and NP 11-202 Receipt dated November 19, 2014 Series O Units) Offering Price and Description: Principal Regulator - Ontario $3,000,000,000 Type and Date: Debt Securities Final Simplified Prospectuses dated November 14, 2014 Preferred Shares NP 11-202 Receipt dated November 20, 2014 Common Shares Offering Price and Description: Warrants to Purchase Equity Securities Series A, Advisor Series, Advisor T5 Series, Series T5, Warrants to Purchase Debt Securities Series H, Series F, Series FT5, Series I and Series O Units Share Purchase Contracts @ Net Asset Value Share Purchase or Equity Units Underwriter(s) or Distributor(s): Underwriter(s) or Distributor(s): Royal Mutual Funds Inc. - RBC Global Asset Management Inc. Promoter(s): Royal Mutual Funds Inc. - Promoter(s): Project #2275386 RBC Global Asset Management Inc. Project #2267741 ______Issuer Name: ______Voya Global Income Solutions Fund Issuer Name: Principal Regulator - Ontario Social Housing Canadian Bond Fund Type and Date: Social Housing Canadian Equity Fund Final Long Form Prospectus dated November 18, 2014 Social Housing Canadian Short-Term Bond Fund NP 11-202 Receipt dated November 20, 2014 Type and Date: Offering Price and Description: Amendment #2 dated November 12, 2014 to the Simplified Maximum $100,000,000 (10,000,000 Class A Units and/or Prospectuses and Annual Information Form dated June Class U Units) 27, 2014 Price: $10.00 per Class A Unit and U.S. $10.00 per Class Receipted on November 19, 2014 U Unit Offering Price and Description: Minimum purchase: 100 Class A Units or Class U Units - Underwriter(s) or Distributor(s): Underwriter(s) or Distributor(s): BMO Nesbitt Burns Inc. Philips, Hager & North Investment Funds Ltd. Scotia Capital Inc. Promoter(s): CIBC World Markets Inc. - RBC Dominion Securities Inc. Project #2214185 National Bank Financial Inc. GMP Securities L.P. ______Canaccord Genuity Corp. Issuer Name: Raymond James Ltd. Social Housing Canadian Bond Fund Burgeonvest Bick Securities Limited Social Housing Canadian Equity Fund Desjardins Securities Inc. Social Housing Canadian Short-Term Bond Fund Dundee Securities Ltd. Principal Regulator - Ontario Mackie Research Capital Corporation Type and Date: Manulife Securities Incorporated Final Simplified Prospectuses dated November 13, 2014 Promoter(s): NP 11-202 Receipt dated November 18, 2014 Aston Hill Capital Markets Inc. Offering Price and Description: Project #2264579 Series B Units Underwriter(s) or Distributor(s): ______Philips, Hager & North Investment Funds Ltd. Promoter(s): - Project #2279772; 2265640
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November 27, 2014 (2014), 37 OSCB 10663
IPOs, New Issues and Secondary Financings
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November 27, 2014 (2014), 37 OSCB 10664
Chapter 12
Registrations
12.1.1 Registrants
Type Company Category of Registration Effective Date
Additional Registration Alignvest Investment Commodity Trading Manager November 18, 2014 Category Management Corporation
From: Portfolio Manager and Investment Fund Manager Change in Registration Antares Investment Category November 19, 2014 Management, Inc. To: Portfolio Manager,
Investment Fund Manager and Exempt Market Dealer
Transition Financial Advisors Voluntary Surrender Portfolio Manager November 19, 2014 Group, Inc.
From: ZLC Private Investment Management Inc. Portfolio Manager and Firm Name Change November 13, 2014 Exempt Market Dealer To: ZLC Wealth Inc.
Portfolio Manager, New Business SIA Wealth Management Inc. Investment Fund Manager November 21, 2014 and Exempt Market Dealer
From: Portfolio Manager, Investment Fund Manager, Change in Registration Manulife Asset Management Exempt Market Dealer September 29, 2014 Category Limited To: Portfolio Manager, Investment Fund Manager
Portfolio Manager, Palette Investment New Business Investment Fund Manager November 24, 2014 Management Inc. and Exempt Market Dealer
November 27, 2014 (2014), 37 OSCB 10665
Registrations
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November 27, 2014 (2014), 37 OSCB 10666
Chapter 25
Other Information
25.1 Permissions
25.1.1 Anglo Pacific Group PLC – s. 38(3)
Headnote
Filer granted permission from the Director, pursuant to s. 38(3) of the Securities Act (Ontario), to make listing representations in its offering documents to the effect that the filer intends to make application to the London Stock Exchange for its Ordinary Shares to be admitted for listing and trading.
Statutes Cited
Securities Act, R.S.O. 1990, c. S.5, as am., s. 38(3).
November 18, 2014
Norton Rose Fulbright Canada LLP 200 Bay Street, Suite 3800 Royal Bank Plaza, South Tower Toronto, Ontario M5J 2Z4
Attention: Mr. Bruce Sheiner
Re: Anglo Pacific Group PLC
Application for Permission under s. 38(3) of the Securities Act (Ontario) to Make Listing Representations
Further to your letter submitted on behalf of Anglo Pacific Group PLC (the Filer) dated November 10, 2014 (the Application), we understand that:
1. The Filer is incorporated in England and Wales under the Companies Act 1948 with registered number 00897608.
2. The Filer’s Ordinary Shares are listed on the London Stock Exchange (LSE) and the Toronto Stock Exchange (TSX) and is therefore a reporting issuer in Ontario.
3. The Filer is proposing to issue Ordinary Shares (the New Ordinary Shares) by way of a Firm Placing and Placing and Open Offer (the Offering).
4. The Offering is being made by way of prospectus (the Prospectus) in the United Kingdom and certain other jurisdictions where the extension or availability of the Offering would not breach any applicable law.
5. It is contemplated that the Offering will be made by way of a private placement (the Private Placement) in the Canadian provinces of Ontario and Quebec.
6. In connection with the Private Placement, it is expected that prospective investors in Ontario and Quebec will be provided with either a preliminary and final, or just final, Canadian offering memorandum that includes, as applicable, the preliminary or final Prospectus (collectively the Offering Memoranda).
7. Each prospective investor in Ontario or Quebec will be an “accredited investor” in accordance with National Instrument 45-106 Prospectus and Registration Exemptions or a “permitted client” in accordance with National Instrument 31-103 Registration Requirements and Exemptions.
8. The placement agent in Canada for the Private Placement (the Placement Agent) will, when distributing securities to residents of Ontario, rely on appropriate exemptions from the prospectus requirements and will
November 27, 2014 (2014), 37 OSCB 10667
Other Information
either (i) rely on the “international dealer” exemption to the registration requirements or (ii) be a dealer registered under the securities laws of Ontario.
9. The Offering Memoranda will contain representations identical or substantially similar to the following (the Listing Representations):
a. “Applications will be made to the Financial Conduct Authority for the New Ordinary Shares to be admitted to listing on the premium segment of the Official List and to be admitted to trading on the London Stock Exchange’s main market for listed securities and application has been made to the Toronto Stock Exchange to list the New Ordinary Shares.
b. It is expected that Admission will become effective and that dealings in the New Ordinary Shares will commence at 8:00 a.m. on [] 2014 on the London Stock Exchange’s main market for listed securities and at market open on [] 2014 on the Toronto Stock Exchange.
10. No approval for the listing of the Ordinary Shares on the LSE, conditional or otherwise, has been granted, nor has such stock exchange consented to, nor indicated that they do not object to, the Listing Representations.
11. The Filer seeks permission to include the Listing Representations in the Offering Memoranda to be provided and made available to prospective Ontario purchasers.
Based upon the representations above and the representations contained in your Application, permission is hereby granted pursuant to subsection 38(3) of the Securities Act (Ontario) to include the Listing Representations (through the incorporation of the preliminary or final Prospectus, as the case may be) in the Offering Memoranda to be provided to or made available to prospective Ontario purchasers.
Yours very truly,
“Sonny Randhawa” Manager, Corporate Finance Branch Ontario Securities Commission
November 27, 2014 (2014), 37 OSCB 10668
Index
1832 Asset Management L.P. CIBC Asset Management Inc. Decision ...... 10368 Decision ...... 10396
Aegon Fund Management Inc. Companion Policy 24-102CP Clearing Agency Decision ...... 10372 Requirements Request for Comments ...... 10483 Alignvest Investment Management Corporation Additional Registration Category ...... 10665 Desjardins Investments Inc. Decision ...... 10456 Alpha Exchange Inc. Order – s. 147 ...... 10477 Fidelity Investments Canada ULC Decision ...... 10404 Alpha Trading Systems Limited Partnership Order – s. 147 ...... 10477 Five Nines Ventures Ltd. Cease Trading Order ...... 10479 AlphaPro Management Inc. Decision ...... 10376 Franklin Bissett Bond Corporate Class Decision ...... 10351 American Bonanza Gold Corp. Decision ...... 10362 Franklin Bissett Bond Yield Class Decision ...... 10351 Anglo Pacific Group PLD Permission – s. 38(3) ...... 10667 Franklin Bissett Canadian Short Term Bond Yield Class Decision ...... 10351 Antares Investment Management, Inc. Change in Registration Category ...... 10665 Franklin Bissett Corporate Bond Yield Class Decision ...... 10351 ATB Investment Management Inc. Decision ...... 10448 Franklin Templeton Investments Corp. Decision ...... 10351 Besra Gold Inc. Decision ...... 10408 Cease Trading Order ...... 10479 Galileo Webtrack Systems Corp. Bigfoot Recreation & Ski Area Ltd. Cease Trading Order ...... 10479 Notice from the Office of the Secretary ...... 10343 Order – ss. 127(1), 127(10) ...... 10467 Gestion FÉRIQUE Decision ...... 10456 Blackrock Asset Management Canada Limited Decision ...... 10380 Hesperian Capital Management Ltd. Decision ...... 10448 BMO Asset Management Inc. Decision ...... 10384 Horizons ETFs Management (Canada) Inc. Decision ...... 10412 BMO Harris Investment Management Inc. Decision ...... 10388 I.G. Investment Management, Ltd. Decision ...... 10452 BMO Investments Inc. Decision ...... 10392 IFRS Release No. 2 Notice ...... 10341 Canadian Imperial Bank of Commerce Decision ...... 10400 Invesco Canada Ltd. Decision ...... 10416 Canoe Financial LP Decision ...... 10448 Investment Funds Practitioner – November 2014 Notice ...... 10337
November 27, 2014 (2014), 37 OSCB 10669
Index
ITG Canada Corp. OSC Rule 45-501 Ontario Prospectus and Registration Decision ...... 10462 Exemptions Rules and Policies ...... 10481 Mackenzie Financial Corporation Decision ...... 10420 OSC, Investment Funds and Structured Products Branch – IFRS Release No. 2 Manulife Asset Management Limited Notice ...... 10341 Decision ...... 10424 Change in Registration Category ...... 10665 Palette Investment Management Inc. New Business ...... 10665 Mawer Investment Management Ltd. Decision ...... 10448 Pro-Financial Asset Management Inc. Notice from the Office of the Secretary ...... 10343 McHaffie, Ronald Stephen Order ...... 10468 Notice from the Office of the Secretary ...... 10343 Order – ss. 127(1), 127(10) ...... 10467 RBC Global Asset Management Inc. Decision ...... 10432 MD Physician Services Inc. Decision ...... 10428 Sentry Investments Inc. Decision ...... 10436 National Bank Investments Inc. Decision ...... 10456 SIA Wealth Management Inc. New Business ...... 10665 Nexans S.A. Decision ...... 10356 Sonde Resources Corp. Cease Trading Order ...... 10479 Next Edge Capital Corp. Decision ...... 10345 Standard Life Mutual Funds Ltd. Decision ...... 10456 Next Edge Commercial Trust Decision ...... 10345 TD Asset Management Inc. Decision ...... 10440 Next Edge Private Debt Fund Decision ...... 10345 Templeton Global Bond Hedged Yield Class Decision ...... 10351 Next Edge Private Debt LP Decision ...... 10345 TG Residential Value Properties Ltd. Notice from the Office of the Secretary ...... 10344 NI 24-102 Clearing Agency Requirements Order – ss. 127(7), 127(8) ...... 10476 Request for Comments ...... 10483 Cease Trading Order ...... 10479
NI 41-101 General Prospectus Requirements TMX Group Inc. Request for Comments ...... 10572 Order – s. 147...... 10477
NI 44-101 Short Form Prospectus Distributions TMX Group Limited Request for Comments ...... 10572 Order – s. 147...... 10477
NI 45-101 Rights Offering TransCanada PipeLines Limited Request for Comments ...... 10572 Decision ...... 10364
NI 45-102 Resale Restrictions TransCanada Trust Request for Comments ...... 10572 Decision ...... 10364
NI 45-106 Prospectus and Registration Exemptions Transition Financial Advisors Group, Inc. Request for Comments ...... 10572 Voluntary Surrender ...... 10665
Northland Resources SE TSX Inc. Cease Trading Order ...... 10479 Order – s. 147...... 10477
NovaDx Ventures Corp. Vanguard Investments Canada Inc. Cease Trading Order ...... 10479 Decision ...... 10444
November 27, 2014 (2014), 37 OSCB 10670
Index
ZLC Private Investment Management Inc. Firm Name Change ...... 10665
ZLC Wealth Inc. Firm Name Change ...... 10665
November 27, 2014 (2014), 37 OSCB 10671
Index
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November 27, 2014 (2014), 37 OSCB 10672