Legend Requirements for Private Placements of Book-Entry Only Securities

With the coming into force of National Instrument 45-106 - Prospectus and Registration Exemptions (NI 45-106), the Canadian Securities Administrators (CSA) also adopted a number of consequential amendments to various related policies and instruments. These included consequential amendments to Multilateral Instrument 45-102 - Resale of Securities (now National Instrument 45-102 or NI 45-102).

Under NI 45-102, the first sale of securities issued in reliance upon certain private placement exemptions is considered to be a distribution (i.e. generally requiring a prospectus), unless certain prescribed conditions are satisfied. One of these conditions is that the certificate representing the security carries a legend indicating that the securityholder may not sell the security until the later of four months and a day after the acquisition date or the date the issuer becomes a reporting issuer. This requirement was