TORONTO STOCK EXCHANGE 17 (v) Other Considerations IFRS Certain of the financial tests included in the OLR refer to select financial statement measures. The requirements in IFRS 18 Presentation and Disclosure in Financial Statements (“IFRS 18”) are effective for annual reporting periods commencing on or after January 1, 2027, with earlier adoption permitted, and will replace IAS 1 Presentation of Financial Statements. Notable changes imposed by IFRS 18 include: (i) requirements to present two new defined subtotals; (ii) disclosure of management performance measures (may include some non-GAAP measures); and (iii) new principles for aggregation and disaggregation of revenue and expense line items. While the new standards imposed by IFRS 18 may change the overall appearance and presentation of the financial statements, no substantive changes to the application of the OLR are expected. For example, for assessing whether an applicant meets the Income Test pre-tax net income from continuing operations test pursuant to Section 309(a)(i), the starting point would be the financial statement line item: profit or loss before income tax total (before discontinued operations). Consistent with past practices, TSX Staff would make further adjustments by removing non-recurring items or items not considered to be part of ordinary course business operations (e.g., one- time settlement gains and losses on litigation, gains and losses on a one- time sale of assets no longer used by the business, revenues from subleasing downsized warehouse space that are considered to be ancillary to the primary business operations, consideration for subsequent adverse material changes to the business, etc.). In reviewing an applicant’s suitability for listing, a review of the financial statement measures is the starting point. However, in order to make a complete assessment of the applicant, an evaluation of the business’ past performance and future prospects, including recent historical unaudited financial performance, are required, and this may require the review of other information sources (including proprietary discussions with management) beyond the historical financial statements. Public Distribution All applicants are required to demonstrate public distribution of at least 1,000,000 freely tradeable securities held by at least 300 public holders, each holding one board lot or more, as per Sections 310, 315 and 320 of the Manual. Note that: • for securities with a market value of $1.00 per security or greater, a board lot constitutes 100 securities; • for securities with a market value of less than $1.00 to $0.10 per security, a board lot constitutes 500 securities; and • for securities with a market value of less than $0.10 per security, a board constitutes 1,000 securities. Management For all listing categories, the management of the applicant is an important factor in the consideration of a listing application. As per Section 325 of the Manual, TSX reserves the right to exercise discretion in considering all factors related to the management of an applicant in order to determine the acceptability of the applicant for listing on TSX. The background and expertise of management in the context of the applicant’s business, whether a diversified industry, mining or oil and gas, will be considered in order to ensure adequate experience and technical expertise relevant to the applicant’s business. Management background will also be reviewed to ensure the applicant’s ability to comply with public company disclosure obligations, such as the TSX Timely Disclosure Requirements (see the TSX Guide to Timely Disclosure Requirements).
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