Prospectus Preparation – Securities Regulation

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  • Prospectus Preparation

In general, prospectus gives investors full and plain disclosure of all material facts – what the investors want to know. This may include:

  • What will the investment be used for?
  • What is the underwriter agreement?
  • How much are you paying senior executives?
  • Who is the CEO/ BOD?
  • What are your financial statements – assets, liabilities, any lawsuits?
  • What interest in the company am I buying? – # of shares, rights (to vote, to receive dividends, etc.)
  • What is the capital structure? What does your company DO? How does it make its money? (e.g. Cineplex makes it money on popcorn, not movies)

2) Must comply with the requirements of the Securities Act (including 56, 58, 59) -Includes OSA, OSA regulation, OSC rules and the OSC director.

Section 56: (1) Full, true and plain disclosure and complying with all requirements of Ontario securities law; (2) Must also include any financial reports, statements or other docs required by the Act or regulations

Section 58(1) Issuer Certificate (signed by CEO, CFO and two directors that aren’t CFO/CEO, and any promoter of the issuer) – certifies prospectus is true

Section 59(1) Underwriter certificate (signed by any/all UWs in a contractual relationship with the issuer or selling securityholder distributing securities through the prospectus) – UW also certifies prospectus is true

You can grab notes on other topic from here.

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