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November 3, 2008
Normal Course Issuer Bids
Remedial Review Process
"market price" definition
Financial Hardship Exemption
STAFF NOTICE TO APPLICANTS, LISTED ISSUERS, SECURITIES LAWYERS AND PARTICIPATING ORGANIZATIONS
Given the current extraordinary market conditions, Toronto Stock Exchange ("TSX") staff is providing the following notice to provide temporary relief to listed issuers from certain requirements in the TSX Company Manual (the "Manual") and to remind issuers of certain provisions in the Manual that may be useful under these conditions. The provisions of this notice in respect of Normal Course Issuer Bids and the Remedial Review Process are effective as of 12:01 a.m. EST on November 3, 2008, until 11:59 p.m. EST on March 31, 2009 (the "Effective Period"), unless further extended. The discretionary relief in relation to Normal Course Issuer Bids is being provided by TSX pursuant to Section 603 of the Manual and Rule 3-207 of TSX's Trading Rules. The relief in respect of the Remedial Review Process is being provided by TSX in accordance with Sections 706 and 707 of the Manual.
Normal Course Issuer Bids ("NCIB")
TSX is granting temporary relief to its listed issuers making NCIB purchases.
For the Effective Period, the volume of purchases condition in Subsection 628(a)(ix)(a) of the Manual is modified so that the amount of NCIB purchases must not exceed 50% of the ADTV for the security, rather than 25% of the ADTV.
Similarly, for Participating Organizations acting on behalf of issuers for NCIB purchases during the Effective Period the volume of purchases condition in TSX Rule 6-101, subsection (a) of "normal course issuer bid", is modified so that the amount of NCIB purchases must not exceed 50% of the ADTV for the security, rather than 25% of the ADTV.
All other provisions in Sections 628 and 629 of the Manual and Part 6 of the TSX Trading Rules in connection with NCIBs, including the manner, price restrictions and aggregate volume restrictions, are not altered by this Staff Notice. The provisions of this notice shall apply to any relevant NCIB purchase made during the Effective Period, and shall also apply to purchases made under NCIBs renewed or launched during the Effective Period.
Remedial Review Process
TSX is extending the time period it normally gives issuers under the Remedial Review Process from up to 120 days to up to 210 days.
For the Effective Period, Section 707(a) is modified so that an issuer under a remedial review will generally be granted up to 210 days to remedy the deficiencies that triggered the delisting review and any additional deficiencies that arose during the review period. TSX has determined that extending the remedial review period by up to 90 days may permit issuers a more reasonable time period to correct deficiencies, given current market conditions. This provision shall apply to all issuers currently under a remedial delisting review and to all issuers placed under remedial review during the Effective Period. All other provisions in Part VII of the Manual, including the Expedited Review Process and the delisting criteria, are not altered by this Staff Notice.
"Market price" Definition
The definition of "market price" in Part I of the Manual provides that the 5 day volume weighted average trading price of the listed securities ("VWAP") should be used to determine market price. It also provides that the 5 day period may be adjusted based on relevant factors if such price does not accurately reflect the current market price of the securities. TSX is mindful that 5 days in the current volatile environment is a relatively long period of time to establish market price. Accordingly, on a case-by-case basis, TSX will use a shorter time period for the determination of market price for the purposes of pricing securities (including warrants) for private placements.
Securityholder Approval — Financial Hardship Exemption
TSX reminds issuers that Section 604(e) provides an exemption from securityholder approval requirements for issuers experiencing serious financial difficulties. TSX recognizes that issuers should be able to enter into transactions in a timely manner when faced with financial difficulty.
TSX will continue to monitor the effect that market conditions are having on the operation of its rules and its issuers. If you have any questions about this Staff Notice, please contact your listings manager.
November 3, 2008.
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