Draft Regulation to amend Regulation 44-103 respecting Post-Receipt Pricing

REGULATION TO AMEND REGULATION 44-103 RESPECTING POST-RECEIPT PRICING Securities Act (chapter V-1.1, s. 331.1, par. (2), (4.1), (6.1.1) and (8))

1. Regulation 44-103 respecting Post-Receipt Pricing (chapter V-1.1, r. 18) is amended by inserting, after section 2.4, the following part: “PART 2A ACCESS TO SUPPLEMENTED PREP PROSPECTUSES 2A.1. Application This Part does not apply in respect of a prospectus to distribute securities of an investment fund. 2A.2. Access equals delivery (1) This section does not apply in British Columbia. (2) The requirement under securities legislation to deliver or send a prospectus is satisfied when access to the supplemented PREP prospectus, the preliminary base PREP prospectus or any amendment to the documents has been provided in accordance with subsection 2A.3(3) or (6). (3) The supplemented PREP prospectus, the preliminary base PREP prospectus or any amendment to the documents is delivered or sent on the date that access to the document has been provided in accordance with subsection 2A.3(3) or (6). (4) The supplemented PREP prospectus or any amendment is received on the date the document has been delivered or sent in accordance with subsection (3). (5) Except in Saskatchewan, if the supplemented PREP prospectus or any amendment is delivered or sent in accordance with subsection 2A.3(3), the right to withdraw from, or in Québec the right to rescind, an agreement to purchase a security provided to a purchaser under securities legislation may be exercised within 2 business days after the later of (a) the date the document is received in accordance with subsection (4), and (b) the date that the purchaser has entered into the agreement to purchase the security. (6) In Saskatchewan, if the supplemented PREP prospectus or any amendment has been delivered or sent in accordance with subsection 2A.3(3), a purchaser that is not a registrant may cancel a purchase if the purchaser has not sold or otherwise transferred beneficial ownership of the security and the person from whom the purchaser purchased the security receives notice in writing to cancel the agreement of purchase and sale for the security at any time up to 2 business days after the later of (a) the date that the document is received in accordance with subsection (4), and (b) the date that the purchaser has entered into the agreement to purchase the security.

2 2A.3. Procedures (1) This section does not apply in British Columbia. (2) A supplemented PREP prospectus or any amendment must be delivered or sent by providing access to the document, unless the document is delivered or sent pursuant to another procedure prescribed by securities legislation. (3) Access to the supplemented PREP prospectus or any amendment has been provided if (a) the base PREP prospectus or any amendment has been filed on SEDAR and a receipt has been issued for the document; (b) the supplemented PREP prospectus or any amendment has been filed on SEDAR; (c) on the same day the supplemented PREP prospectus or any amendment was filed, a news release has been issued and filed on SEDAR that states (i) in the title of the news release, that the supplemented PREP prospectus or any amendment is available, (ii) that the supplemented PREP prospectus or any amendment is accessible at www.sedar.com, (iii) the securities that are offered under the supplemented PREP prospectus, and (iv) the following: “An electronic or paper copy of the supplemented PREP prospectus or any amendment may be obtained, without charge, from [insert contact information for the issuer or dealer, as applicable] by providing the contact with an email address or address, as applicable.”. (4) If a prospective purchaser requests a copy of the preliminary base PREP prospectus or any amendment, or a purchaser requests a copy of the supplemented PREP prospectus or any amendment, from the issuer or dealer, a copy of the document must be sent by the issuer or dealer within 2 business days and without charge to the prospective purchaser or purchaser at the email address or address specified in the request. (5) Except if a prospective purchaser indicates an interest in purchasing a security and requests a copy of the preliminary base PREP prospectus or any amendment, such document that is required to be delivered or sent must be delivered or sent by providing access to the document, unless the document is delivered or sent pursuant to another procedure prescribed by securities legislation. (6) Access to the preliminary base PREP prospectus or any amendment has been provided if the issuer has filed on SEDAR, and a receipt has been issued for, the document. 2A.4. Exemption from requirement to send prospectus – British Columbia (1) In British Columbia, a dealer is exempt from a requirement under securities legislation to send a prospectus or any amendment if (a) the base PREP prospectus or any amendment has been filed on SEDAR and a receipt has been issued for the document,

3 (b) a supplemented PREP prospectus or any amendment has been filed on SEDAR, and (c) on the same day the supplemented PREP prospectus or any amendment was filed, a news release has been issued and filed on SEDAR that states (i) in the title of the news release, that the supplemented PREP prospectus or any amendment is available, (ii) that the supplemented PREP prospectus or any amendment is accessible at www.sedar.com, (iii) the securities that are offered under the supplemented PREP prospectus, and (iv) the following: “An electronic or paper copy of the supplemented PREP prospectus or any amendment may be obtained, without charge, from [insert contact information for the issuer or dealer, as applicable] by providing the contact with an email address or address, as applicable.”. (2) In British Columbia, a dealer or issuer that solicits expressions of interest from a prospective purchaser is exempt from the requirement in securities legislation to send a copy of the preliminary base PREP prospectus or any amendment to the prospective purchaser if the document has been filed on SEDAR and a receipt has been issued for the document. (3) If a purchaser requests a copy of the supplemented PREP prospectus or any amendment from the issuer or dealer, a copy of the document must be sent by the issuer or dealer within 2 business days and without charge to the purchaser at the email address or address specified in the request. (4) If a dealer relies on subsection (1), an agreement of purchase and sale is not binding on a purchaser if the dealer from whom the purchaser purchases the security receives written notice sent by the purchaser, evidencing the intention of the purchaser not to be bound by the agreement, not later than 2 business days after the later of (a) the date that conditions referred to in subsection (1) are satisfied, and (b) the date of the agreement. (5) Subsection (4) does not apply if the purchaser (a) is a registrant, or (b) disposes of the beneficial ownership of the security referred to in subsection (4), otherwise than to realize on collateral given for debt, before the end of the time referred to in subsection (4). (6) For the purposes of this section, receipt of the notice referred to in subsection (4) by a dealer that acted as agent of the seller with respect to the sale of the security referred to in subsection (1) is deemed to be receipt by the seller on the date on which the dealer received the notice.”. 2. Section 4A.2 of the Regulation is amended by replacing paragraph (2) with the following: “(2) A standard term sheet provided under subsection (1) must be dated and include the following legend, or words to the same effect, on the first page:

4 “A [final base PREP prospectus/supplemented PREP prospectus] containing important information relating to the securities described in this document has been filed with the securities regulatory authorit[y/ies] in [each of/certain of the provinces/provinces and territories of Canada]. The [final base PREP prospectus/supplemented PREP prospectus] or any amendment is available on SEDAR. A copy of the document may be obtained from [insert contact information for the investment dealer or underwriters]. This document does not provide full disclosure of all material facts relating to the securities offered. Investors should read the supplemented PREP prospectus and any amendment for disclosure of those facts, especially risk factors relating to the securities offered, before making an investment decision.”.”. 3. Section 4A.3 of the Regulation is amended: (1) by replacing, in paragraph (1), subparagraph (g) with the following: “(g) the investment dealer (i) includes, in the marketing materials, a statement that the final base PREP prospectus or any amendment, or if it has been filed, the supplemented PREP prospectus or any amendment, is available on SEDAR, or (ii) provides, with the marketing materials, a copy of the final base PREP prospectus or any amendment, or if it has been filed, the supplemented PREP prospectus or any amendment.”; (2) by replacing paragraph (6) with the following: “(6) Marketing materials provided under subsection (1) must be dated and include the following legend, or words to the same effect, on the first page: “A [final base PREP prospectus/supplemented PREP prospectus] containing important information relating to the securities described in this document has been filed with the securities regulatory authorit[y/ies] in [each of/certain of the provinces/provinces and territories of Canada]. The [final base PREP prospectus/supplemented PREP prospectus] or any amendment is available on SEDAR. A copy of the document may be obtained from [insert contact information for the investment dealer or underwriters]. This document does not provide full disclosure of all material facts relating to the securities offered. Investors should read the supplemented PREP prospectus and any amendment for disclosure of those facts, especially risk factors relating to the securities offered, before making an investment decision.”.”. 4. Section 4A.4 of the Regulation is amended: (1) by replacing, in paragraph (3), subparagraph (c) with the following: “(c) make an oral statement at the commencement of the road show that the final base PREP prospectus and any amendment, or if they have been filed, the supplemented PREP prospectus and any amendment, are available on SEDAR, or provide the investor with a copy of the final base PREP prospectus and any amendment, or if they have been filed, the supplemented PREP prospectus and any amendment.”.

5 (2) by adding, in the statement under paragraph (4) and after the second sentence, the sentence “The [final base PREP prospectus/ supplemented PREP prospectus] or any amendment is available on SEDAR.”. 5. (1) This Regulation comes into force on (indicate here the date of coming into force of this Regulation). (2) In Saskatchewan, despite paragraph (1), if this Regulation is filed with the Registrar of Regulations after (indicate here the date of coming into force of this Regulation), this Regulation come into force on the day on which it is filed with the Registrar of Regulations.