Securities - raising capital via a range of methods and instruments
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Kim Johnson and Rob Millar assist their business clients with raising capital via a range of methods and instruments, and this involves assessing and advising on compliance with the securities law and regulations that may apply to a particular financing program.  Whether by debt instrument (backed by debenture security) or sale of equity (shares or interests in shares), and whether by private placement to one or several investors, or to a wider range of smaller investors, securities law and regulations must be taken into consideration.  The definition of a “security” includes both debt and equity and many other forms of financial instruments.

As a general rule, a security must be sold by a registered dealer and a prospectus provided to each investor.  However, many financings qualify for one or more available exemptions from both the prospectus and registration requirements, and the securities offered are known as “exempt securities”.  Exempt security offerings must nevertheless comply strictly with a range of requirements, and Kim is experienced in managing the process and documents required, such as preparing an offering memorandum, utilizing appropriate subscription agreements, and post-closing reporting to the applicable Securities Commission.

For example, if the offering memorandum exemption is used, this document must be in a form that complies with regulations, and contains a balanced description of the company and potential risks and benefits for the potential investors.  Kim ensures formal compliance and also advises on the content and presentation of material to ensure the disclosure also complies with the spirit and intent of the legislation.  The goal is to guide clients through the process so as to align management goals and priorities with investor expectations in the context of the financing described by the offering memorandum.

Kim and Rob have among their clients several mortgage investment corporations (MIC’s), which in addition to securities laws are governed by mortgage lending legislation and the Income Tax Act (Canada) (ITA).  They have assisted MIC’s in preparing the necessary corporate articles, along with offering memoranda, shareholder agreements, management agreements and all other material agreements connected with the MIC, its operation, and sale of its securities.

Kim Johnson has experience in reverse take-over (RTO) transactions involving public companies, the going-public process including formation of capital pool companies on the TSX Venture Exchange, and in compliance matters relating to public companies (continuous disclosure) under securities laws and regulations.  In circumstances such as these Kim would generally work in conjunction with other parties acting for underwriters and with specialized counsel.

Our areas of expertise include corporate reorganization and restructuring, finance and securities, mergers and acquisitions, tax litigation, and real estate tax law.

Our Services

  • Exempt Securities, Offering Memoranda
  • Compliance with Capital-Raising Rules and Exemptions
  • Mortgage Investment Corporations (MIC’s)
  • Assist Companies in Vending into a Public Company, and Operating as Public Companies