The Toronto Stock Exchange (TSX) announced amendments to the TSX Company Manual (Amendments) effective September 17, 2015 relating to the listing of Exchanged Traded Products, Closed-End Funds and Structured Products, as defined in the Amendments.

Proposed Amendments were first published on January 15, 2015.  Nine commentators (including Fasken Martineau DuMoulin LLP) provided comments.  A summary of the comments and the TSX response to them are included with the announcement.

Among other matters, the final Amendments included the following changes from the proposed Amendments:

  • the definition of Closed-End Fund was amended to align with the definition of non-redeemable investment fund in the Securities Act (Ontario);
  • the minimum market capitalization for a Closed-End Fund was reduced from $20 million to $10 million;
  • management of Non-Corporate Issuers must have adequate and appropriate experience in the asset management industry and with listed issuers;
  • the net asset value of a Closed-End Fund must be calculated no less frequently than required under applicable securities laws (rather than a minimum weekly basis);
  • the issuance of additional securities of a Closed-End Fund must yield net proceeds per security of no less than 100% of the most recently calculated net asset value (NAV) per security calculated prior to the pricing of such issuance (no longer requiring it to be ‘immediately prior’) and all transactions must close within 30 days of the pricing (rather than from the date of the calculation of NAV);
  • the TSX may require securityholder approval for any amendments to the constating documents of an Exchange Traded Product or Closed-End Fund that are not covered by the amendment provisions of the documents that may materially affect the rights of securityholders;
  • the extension of an Exchange Traded Product or Closed-End Fund beyond the originally contemplated termination date may require securityholder approval unless securityholders are provided with the opportunity to redeem securities at NAV within 3 months of the originally contemplated termination date and notice of the extension at least 30 days prior to the redemption deadline;
  • Non-Corporate Issuers must pre-clear any information circulars and other materials related to corporate actions (for example, redemptions, consolidations or stock splits) to be sent to securityholders at least 5 business days in advance of finalization (which narrows the requirements from what was in the Proposed Amendments); and
  • the TSX agreed that the requirements of National Instrument 81-102 – Investment Funds provide substantial comfort regarding the approval for fund mergers and accordingly repealed Section 604(g) of the TSX Manual.