CSA Outline Concerns Regarding Issuers' Financial Condition During Prospectus Offering

The CSA today published a staff notice outlining its approach to situations where it has concerns with the financial condition of an issuer and/or the sufficiency of proceeds from the offering during a prospectus review. According to the CSA, there are limited circumstances where such concerns may lead to a refusal to issue a prospectus receipt.

The notice specifically identifies five areas of concern, namely with respect to: (i) missing information regarding offering amount and pricing; (ii) offering structure; (iii) use of proceeds disclosure; (iv) risk factor disclosure; and (v) representations to support ability to continue operations. Of particular interest, guidance is also provided to assist issuers in addressing each concern.