TSX Publishes Final Amendments to Website and Security Based Compensation Disclosure Requirements
The Toronto Stock Exchange (TSX) has published final amendments to the TSX Company Manual related to disclosure of securities based compensation arrangements and the requirement to post certain key governance documents on their websites. The new securities based compensation disclosure rules are effective for financial years ending on or after October 31, 2017, and the deadline for compliance with the website disclosure rules is April 1, 2018.
Background
The amendments were originally proposed by the TSX in May 2016 (see our May 27, 2016 Update, TSX Proposes Amendments to Disclosure Requirements Related to Issuer Websites and Security Based Compensation Arrangements) and were revised in April 2017 in response to comments received from market participants (see our April 21, 2017 Update, TSX Publishes Revised Proposal For Amendments to Disclosure Requirements Related to Websites and Security Based Compensation Arrangements).
Website Disclosure Amendments
The website disclosure rules require listed issuers (other than non-corporate issuers, eligible interlisted issuers and eligible international interlisted issuers, as such terms are defined in the TSX Company Manual) to post the following documents on their websites by no later than April 1, 2018:
- articles of incorporation, amalgamation, continuation or any other constating or establishing documents of the issuer and its bylaws; and
- if adopted, copies of any:majority voting policy;
- advance notice policy;
- position descriptions for the chairman of the board and the lead director;
- board mandate; and
- board committee charters.
The above documents should be on a web page that is easily identifiable and accessible from the listed issuer’s home page or investor relations page.
Securities Based Compensation Disclosure Amendments
Under the new rules for securities based compensation disclosure, listed issuers must disclose the following information in their proxy circulars effective for financial years ending on or after October 31, 2017:
- Burn Rate. Listed issuers must disclose, on an annual basis, a burn rate – calculated in accordance with a prescribed methodology – for each security based compensation arrangement maintained by the issuer for the issuer’s three most recently completed financial years (or each financial year since adoption if the plan or a predecessor has not existed for three years). If the securities awarded include a multiplier, issuers are required to provide details in respect of such multiplier. In the final amendments, the TSX now requires issuers to disclose the burn rate for the three most recent financial years for all shareholders meetings (previously only one year’s burn rate was required unless security holder approval of a plan matter was being sought).
- Awards Issuable, Outstanding and Available for Grant. The amendments clarify and enhance the disclosure required in respect of the maximum number of awards issuable under each plan, the number of outstanding securities awarded under each plan and the number of awards still available for grant under each plan. Disclosure regarding the vesting and term of securities awarded under all security based compensation arrangements, not just stock option plans, will now also be required (which is a change from previous versions of the amendments).
For any annual meeting (whether or not security holder approval will be sought for a plan matter), the disclosure regarding security based compensation arrangements would be prepared as at the end of the listed issuer’s most recently completed financial year (to better align the disclosure with executive compensation disclosure required under securities laws). For any meeting other than an annual meeting where security holder approval will be sought for a plan matter, the disclosure (other than the annual burn rate) would continue to be prepared as of the date of the meeting materials.
Expertise
Authors
Insights
-
REITS and Income Securities
The Legal Industry Reviews Edition 5 - REITs Chapter
Stephen Pincus, Brenda Gosselin, and Bill Gorman have co-authored The Canadian REIT Structure in the fifth edition of The Legal Industry Reviews Canada.To view the… -
Financial Services Regulatory
Canadian Securities Administrators Extend Compliance Deadline in Interim Approach to Value-Referenced Crypto Assets
On April 17, 2024, the Canadian Securities Administrators (CSA) provided an update to their interim approach in respect of “Value-Referenced Crypto Assets” (VRCAs), as set out in the CSA’s guidance in… -
Financial Services Regulatory
Obligations and Opportunity - Budget 2024’s Impact on the Blockchain Industry
As crypto-assets become subject to further regulation both domestically and globally, industry players find themselves presented not only with new obligations but also with new opportunities. Canada’s… -
Capital Markets
Public Safety Canada Releases Updated Guidance on Modern Slavery Reporting Obligations
The Fighting Against Forced Labour and Child Labour in Supply Chains Act (the “Act”) came into force on January 1, 2024, implementing enhanced reporting requirements for certain entities to… -
Capital Markets
Ontario Court of Appeal Enforces Contractual Waiver of Statutory Dissent Rights
Ontario’s Court of Appeal concluded in a recent decision that, subject to limited exceptions, shareholders can contractually waive statutory “dissent rights”, which allow shareholders to dissent in… -
Capital Markets
CSA Provides Further Updated Guidance on Virtual Shareholder Meetings
On February 22, 2024, the Canadian Securities Administrators (CSA) recently published updated guidance on virtual shareholder meetings following initial guidance provided in February 2022. See…
Featured Work
-
Capital Markets
RioCan REIT issues private placement offering of $300 million debentures
Goodmans LLP advised RioCan REIT in connection with a transaction that involved a brokered private placement offering of $300 million principal amount of Series AK senior unsecured debentures by… -
Mining
Hudbay Minerals completes US$402 million bought deal equity offering
Goodmans LLP advised Hudbay Minerals Inc. in the public offering of its common shares for aggregate gross proceeds of US$402,477,000, including the full exercise of the underwriters’ overallotment… -
Mergers and Acquisitions
Screaming Eagle merges with Lionsgate Studios
Goodmans LLP acted for Screaming Eagle Acquisition Corp. in connection with its merger with the Studio Business of Lionsgate Entertainment Corp., comprised of its Television Studio and Motion Picture… -
Capital Markets
Dye & Durham’s defence of requisition from Engine Capital
Goodmans LLP is acting for the board of Dye & Durham in connection with a defence of requisition from Engine Capital… -
Capital Markets
Board of WonderFi Technologies Inc.’s proxy defense from KAOS Capital and Mogo
Goodmans LLP is acting for the special committee of the board of WonderFi Technologies Inc in connection with its defense of a proxy contest launched by KAOS Capital and MOGO. KAOS Capital is a… -
Tax
Cineplex announces comprehensive refinancing plan
Goodmans LLP is acting for Cineplex Inc., a leading Canadian entertainment and media company, in connection with its announcement of a comprehensive refinancing plan to improve financial flexibility…
News & Events
-
Banking and Financial Services
Goodmans Lawyers Recognized in the Lexpert Special Edition: Finance and M&A 2024
We are delighted to announce the Lexpert Special Edition: Finance and M&A 2024 once again features Goodmans lawyers among Canada's experts.Congratulations to our 33 featured lawyers:Alan… -
Banking and Financial Services
The Canadian Legal Lexpert Directory 2024 Continues to Recognize Goodmans
We are proud to announce Goodmans LLP has once again been recognized in the 2024 edition of The Canadian Legal Lexpert Directory.91 Goodmans lawyers have been recognized as top-tier in their… -
Banking and Financial Services
Chambers and Partners Continues to Honour Goodmans with Global Recognition
We are proud to announce Goodmans LLP has once again received top-tier recognition from Chambers and Partners in the Chambers Global 2024 Guide released today. Recognition from…