TORONTO STOCK EXCHANGE 12 Management Expertise: This will be viewed holistically. Consideration will be given to a range of factors, including an individual’s past conduct, education, training and experience in the relevant business sector and public markets, as well as the overall composition of the applicant’s management team and board of directors. Corporate governance matters will also be relevant. TSX will generally expect at least one member of the applicant’s board of directors to have recent Canadian public markets experience. Proof of Business Concept: This will be assessed on an individual basis. Typically, TSX Staff will expect to see regulatory approval to proceed with the proposed project or a bankable feasibility report in hand, and evidence that the board of directors has developed a committed pathway to commence construction. This listing category aims to identify enterprises with projects that have a reasonable expectation of advancement in the near future and is not meant for preliminary stage projects. A project involving new technology or innovation is considered to have reached the “proof of business concept” stage when the core technology has been demonstrated as both feasible and effective, with evidence to support its viability at scale. There is an expectation for a working model or a prototype that has shown it can achieve its intended purpose and there is a clear and viable path forward to scale the project from its current state to a fully developed and operational status. Equity Raise: The equity raise must be for an aggregate of $100 million in the six months immediately preceding the applicant’s TSX listing application. The raise may aggregate various tranches within the six month period, and may include proceeds to be raised in an IPO concurrent with listing. The raise may take place on a public or private basis, as long as the applicant is able to meet TSX public distribution requirements. The raise may include issuances at various issue prices, however because TSX regards the raise as evidence of market support for the issuer at the time of TSX listing, the applicant must demonstrate arm’s length support for the issuer at the most recent issue price. Arm’s length support is generally demonstrable by evidence of at least 50 arm’s length purchasers each purchasing a board lot or more. Prior to applying under the 12-Month Test, applicants should discuss financing parameters with TSX Staff to ensure acceptability for the purposes of meeting OLR. Funding to Advance the Project: Given that applicants under this category do not yet have an operating history, the run rate calculation is particularly critical to TSX Staff’s review. The 12 or 24 month run rate calculation, as applicable, must meaningfully support development of the applicant’s proof of business concept. It must incorporate project advancement expenditures set out in the feasibility report. Timing, project milestones and gating items must also be consistent with the feasibility report.
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