Securities Law & Instruments

Headnote

 

Application under section 147 of the Securities Act (Ontario), exempting person or company from any requirement of Ontario securities law – exemption from requirement for TSX Inc. to notify the Commission if it anticipates not maintaining the required financial leverage ratio.

 

Applicable Legislative Provisions

 

Securities Act, R.S.O. 1990, c. S.5, as am., s.147.

 

IN THE MATTER OF

THE SECURITIES ACT,

R.S.O. 1990, CHAPTER S.5, AS AMENDED

(Act)

 

AND

 

IN THE MATTER OF

TSX INC.

 

ORDER

(Section 147 of the Act)

 

                WHEREAS the Ontario Securities Commission (Commission) issued an order dated July 4, 2012, which was varied on April 24, 2015, September 29, 2015 and June 22, 2018, recognizing each of Maple Group Acquisition Corporation (now TMX Group Limited), TMX Group Inc., TSX Inc., Alpha Trading Systems Limited Partnership, and Alpha Exchange Inc. as exchanges under section 21 of the Act (Recognition Order);

 

                AND WHEREAS under subparagraph 36(a)(iii) of Schedule 5 to the Recognition Order, TSX Inc. (TSX) is required to calculate, on a monthly basis, a financial leverage ratio, being the ratio of total assets to shareholders’ equity;

 

                AND WHEREAS under subparagraph 36(c)(iii) of Schedule 5 to the Recognition Order, if TSX determines that it does not have, or anticipates that, in the next twelve months, it will not have, on a consolidated or non-consolidated basis, a financial leverage ratio of less than or equal to 4.0/1, it shall immediately notify the Commission of the ratio that it is not maintaining, or that it anticipates that it will not maintain, the reasons and an estimate of the length of time before the ratio will be compliant;

 

                AND WHEREAS effective January 1, 2019, TSX will be required to utilize International Financial Reporting Standards (IFRS), including IFRS 16, in connection with the requirement under subparagraph 36(a)(iii) of the Recognition Order to calculate a financial leverage ratio;

 

                AND WHEREAS, solely as a result of utilizing IFRS 16 in connection with the requirement under subparagraph 36(a)(iii) of the Recognition Order to calculate a financial leverage ratio, TSX anticipates that it will not have a financial leverage ratio of less than or equal to 4.0/1, as required by subparagraph 36(c)(iii) of the Recognition Order;

 

                AND WHEREAS TSX has applied to the Commission under section 147 of the Act for an order exempting TSX from the requirement at subparagraph 36(c)(iii) of the Recognition Order to immediately notify the Commission that it is not maintaining, or that it anticipates it will not maintain, a financial leverage ratio of less than or equal to 4.0/1, the reasons and an estimate of the length of time before the ratio will be compliant (Application);

 

                AND WHEREAS based on the Application and the representations that TSX has made to the Commission, the Commission has determined that it would not be prejudicial to the public interest to make an order under section 147 of the Act for an order exempting TSX from the requirement at subparagraph 36(c)(iii) of the Recognition Order for a period of one year from the date that TSX is required to use IFRS 16 to calculate a financial leverage ratio;

 

                IT IS ORDERED under section 147 of the Act that TSX is exempt from the requirement at subparagraph 36(c)(iii) of the Recognition Order to immediately notify the Commission that it is not maintaining, or that it anticipates it will not maintain, a financial leverage ratio of less than or equal to 4.0/1, the reasons and an estimate of the length of time before the ratio will be compliant until December 31, 2019.

 

                DATED this 21st day of December 2018 to take effect January 1, 2019.

 

“Deborah Leckman”

 

“Robert P. Hutchison”