TORONTO STOCK EXCHANGE 20 Part IV – Escrow Escrow for new entrants to Canada’s capital markets is required by both securities law, in the case of an IPO, and TSX-specific policy, in the case of listings taking place other than by way of IPO. (i) National Policy Escrow National Policy 46-201 Escrow for Initial Public Offerings (“NP 46201”) requires escrow for IPOs, and includes a standard form of escrow agreement, Form 46-201F1 Escrow Agreement (“Escrow Form”). Pursuant to NP 46-201, escrow is not required for: • an applicant classified by TSX as an exempt issuer at the time of IPO; or • an applicant with a market capitalization of at least $100 million at the time of IPO. TSX defines “exempt issuer” as an issuer with a market capitalization of at least $100 million at time of original listing on TSX. Note that “market capitalization” in this context is as defined at footnote 5 to Subsection 309(a) of the Manual. Therefore, applicants listing on TSX pursuant to an IPO with a market capitalization of $100 million will be exempt from escrow. All other applicants completing IPOs and listing on TSX, will be subject to securities law escrow under NP 46-201. Principals of such applicants will be required to place their securities in escrow under an escrow agreement in accordance with the terms of NP 46-201, to be administered by the relevant CSA jurisdiction and not by TSX. (ii) TSX Escrow Policy The TSX Escrow Policy applies to applicants not otherwise subject to NP 46-201 that have: • listed on TSX by completing reverse takeovers of TSX listed issuers (“Backdoor Listing”); • listed on TSX by completing a qualifying acquisition with a SPAC (“QA”) as under Part X of the Manual; or • conducted their IPOs in markets outside of a CSA jurisdiction within the 12 months preceding the date of the TSX listing application (“Non-CSA IPO”). Pursuant to the TSX Escrow Policy, TSX applies the principles of NP 46-201 in determining when escrow applies in these instances. As a result, escrow is not required for: • an exempt issuer; or • an issuer with a market capitalization of at least $100 million.
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