Final Rule: OSC Rule - 54-501 - Prospectus Disclosure in Certain Information Circulars

ONTARIO SECURITIES COMMISSION RULES
RULE 54-501
PROSPECTUS DISCLOSURE IN CERTAIN INFORMATION CIRCULARS

PART 1DEFINITION AND APPLICATION

1.1Definition of "Dissident Circular" - In this Rule, "dissident circular" means an information circular that is sent to holders of voting securities of a reporting issuer soliciting proxies otherwise than on behalf of management of the reporting issuer.

1.2Application - Subject to section 1.3, this Rule applies only to an information circular that is sent to holders of voting securities of a reporting issuer in respect of a meeting of those holders

(a)for which proxies are being solicited, and

(b)that is being held to consider a statutory amalgamation, statutory arrangement, statutory merger or reorganization involving the reporting issuer and another issuer, under which securities are to be distributed or transferred to security holders of the reporting issuer.

1.3Exception for Dissident Circulars - This Rule does not apply to a dissident circular, unless the sender of the dissident circular is proposing a statutory amalgamation, statutory arrangement, statutory merger or reorganization involving the reporting issuer and the sender, under which securities of the sender, or an affiliate of the sender, are to be distributed or transferred to security holders of the reporting issuer.


PART 2PROSPECTUS DISCLOSURE IN CIRCULARS

2.1Prospectus Disclosure of Issuers Distributing Securities

(1)An issuer sending an information circular, other than a dissident circular, shall include in the information circular the disclosure that would be required in a prospectus if the information circular were a prospectus of each issuer whose securities are being distributed or transferred in connection with the transaction referred to in section 1.2, with necessary modifications.

(2)A sender of a dissident circular shall include in the dissident circular the disclosure that would be required in a prospectus if the dissident circular were: (a) a prospectus of the sender, if securities of the sender are to be distributed; or (b) a prospectus of the affiliate, if securities of an affiliate are to be distributed, in either case with necessary modifications.

2.2Interpretation of Section 2.1 - The disclosure required under section 2.1 to be included in an information circular concerning an issuer whose securities are being distributed or transferred includes the financial statement and other disclosure, if any, of a business acquired or to be acquired by the issuer prescribed by Part 6 or 7 of Rule 41-501 General Prospectus Requirements or Part 4 or 5 of National Instrument 44-101 Short Form Prospectus Distributions, as applicable.

2.3Business Acquisition Disclosure for the Sender of the Circular - If no disclosure concerning the issuer sending an information circular is required under subsection 2.1(1), the issuer sending the information circular shall include in the information circular the financial statement and other disclosure, if any, that would be required under Part 6 or 7 of Rule 41-501 or Part 4 or 5 of National Instrument 44-101, as applicable, if the information circular were a prospectus of the issuer.

PART 3EXEMPTION

3.1Exemption - The Director may grant an exemption to this Rule, in whole or in part, subject to such conditions or restrictions as may be imposed in the exemption.