The Process of Going Public

March 5, 2015

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Overview

• Multiple Pathways to Listing

• Key Players - Regulatory

• Listing Requirements

• Overview of the CPC Process

• Reverse Takeovers

• RTO / QT Problem Areas

• Further Education

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Multiple Pathways to Listing

CPCCapital Pool Company

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Traditional IPOs represent about 20% of the go-public activity on our equity markets. The other go-public transactions, particularly smaller ones utilize other structures that facilitate smaller companies gaining access to capital, long-term investors and experienced Directors that they need to succeed. The Qualifying Transaction is the most common mechanism that companies use to go public on our equity markets. It is a point of differentiation for our equity markets that we provide such a diverse range of structuring tools which provide access to the public markets.

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Key Players - Regulatory

• The Exchanges– For profit, publicly owned– To operate, must have a “recognition order” from applicable securities commissions

• Investment Industry Regulatory Organization of Canada - IIROC (merger of former Investment Dealers Association and Market Regulation Services)– Not for profit entity, “No Share Capital” Corporation– Sets and enforces rules for Canadian Dealers and their employees, and performs Market Surveillance for TSX and TSXV

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TSX Venture Exchange Listing Requirements

•Adequate funds and appropriate capital structure to cover all planned expenses for a certain period of time (varies with each sector or exchange) or •Net tangible asset requirements

•Require public company experience including experience in the Canadian capital markets. •Independent directors, CFO and corporate secretary

•200 public board lot shareholders on TSX Venture.•There is no requirement for Canadian shareholders however, we strongly recommend a shareholder base in North America for a successful listing and a plan to develop a liquid market

•Property requirements and stage of project varies for each Exchange. •Technical reports prepared by independent qualified professionals conforming to standards set under NI 43-101 and NI 51-101. •JORC, SAMREC, etc. resource and reserve standards are recognized for purposes of reporting under NI 43-101.

•One time requirement at the time of listing. Generally required for a new entrant unless the company: is profitable, or completes a prospectus/financing with TSX brokers or sufficient due diligence completed on other market.

FINANCIAL

BOARD OF DIRECTORS AND MANAGEMENT

DISTRIBUTION OF SHARES

SPONSORSHIP

TECHNICAL STANDARDS – MINING AND OIL AND GAS

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Seed Financing and Prospectus

Public Offe

ring

Trade as CPC

Announce QT

File Disclosure Statement

Trade as Venture

Company

CPC Acquires Business (QT)

Public Financing and CPC Trades

Prospectus Receipt

Close Transactio

n

Seed

Identify Q

ualifying Transactio

n

24 Months Maximum

Overview of the CPC Process

Aftermarket and Growth

Execute Business

Plan; IR Program

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Reverse Takeovers

• TSXV Policy Manual Defines an RTO as:

a transaction or series of transactions involving an acquisition of or by an Issuer and a securities issuance by an Issuer that results in:

- New Shareholders holding more than 50% of the issued and outstanding voting securities of the Resulting Issuer; and,

- A Change of Control of the Issuer

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TSXV: RTO / QT Problem Areas

• Initial Listing Requirements– Prior Expenditures– Tech report revisions – Significant interest

• Share Structure – (concerned with shares issued below $0.05/share)

• Emerging Markets– Director and Officer qualifications/composition– Internal Controls

• Validation of Business– Industrial/Technology/Life Sciences Issuers – when is a business formed?– See Exchange Bulletin dated January 29, 2014 –Facilitating the Listing Process for Industrial,

Technology and Life Sciences Issuers

• Financial Statements– Predecessor entities & significant acquisitions– Prospectus rules apply for audits & review

• Stock Options – minimum exercise price• Finder’s Fees – must comply with Policy 5.1• Escrow

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As part of our commitment to helping issuers succeed in the capital markets, we offer many events and tools to broaden their knowledge, such as interactive workshops, online courses and seminars

Rules and Tools Managing a Public Company Mining Disclosure Timely Disclosure Filing Fundamentals Investor Relations Internal Control Environmental and social disclosure Security based compensation rules Private placements, acquisitions and prospectus offerings Understanding corporate governance disclosure Simplifying timely disclosure

112 workshops + 2 on-line courses

2036 participants + 40 on-line

Held in Vancouver, Toronto, Edmonton, Calgary, Montreal, and Halifax

Since January 2010Topics Covered

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TMX Learning Academy – Issuer Education

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