Section 2.9 of National Instrument 45-106 Prospectus Exemptions (NI 45-106) provides that a distribution of a security to a person who purchases the security, is exempt from the prospectus requirements of Applicable Securities Laws in such jurisdictions when specific conditions are met, including:

The following forms of offering memorandum are specified under section 6.4 of NI 45-106:

In British Columbia:

There are different sections and requirements that apply to different Canadian jurisdictions. Generally, there are three different regimes.

There are amendments that include the introduction of the Offering Memorandum Exemption in Ontario effective January 13, 2016, under section 2.9(2.1). These same amendments came into force in Alberta, New Brunswick, Nova Scotia, Québec and Saskatchewan on April 30, 2016, which introduced new investor protection measures in these jurisdictions to address concerns observed with the use of the Offering Memorandum Exemption.

British Columbia and Newfoundland and Labrador continue to have the exemption in section 2.9(1) and Manitoba, Northwest Territories, Nunavut, Prince Edward Island and Yukon continue to have the exemption in section 2.9(2) with additional requirements.

The varying requirements relate to the types of securities, investors, limits on investment and disclosure requirements.

A distribution made in reliance on section 2.9 is subject to the reporting requirements of Part 6 of NI 45-106, which, subject to certain exceptions, may require the filing of a fee and a report on SEDAR+ in Form 45-106F1 in the jurisdiction where the distribution took place no later than 10 days after the distribution. The resale of securities distributed under section 2.5 of NI 45-106 is subject to the restricted period rules under section 2.5 of National Instrument 45-102 - Resale of Securities (NI 45-102).

For more information on the OM exemption and private placements generally, see: