Rojin Nair, Advisor
June 1st, 2021
Investment Executive | Nov 10, 2021
The Alberta Securities Commission (ASC) has adopted a new registration exemption for finders to help startups and other small businesses in the province raise capital, the regulator said in a release on Wednesday.
The small business finder’s exemption — proposed in March of this year by the ASC, and effective Nov. 10, 2021 until Nov. 11, 2024 — is intended to help small businesses use finders to raise money. Finders can be individuals or wholly owned companies owned by individuals, the regulator said in its notice, citing feedback it received from commenters.
The new exemption also includes a number of conditions and better integrates with prospectus exemptions that small businesses in Alberta can rely on, the release said. And, it specifically targets businesses raising less than $5 million.
“We recognize that it can be very difficult to find a registered dealer that is willing to help raise money for financings under $5 million,” Stan Magidson, Chair and CEO of the ASC, so this exemption “allows small businesses to use finders to help them identify potential investors, as long as they adhere to specific conditions.”
Edmonton Journal | | Nov 15, 2021
Proposed amendments to Alberta’s Business Corporations Act would make it easier for directors of private corporations to be involved with multiple related businesses and investments at the same time.
Under the proposed amendments, tabled in the legislature on Monday, Alberta would become the first jurisdiction in Canada to allow corporations to create “corporate opportunity waivers” which set out rules for when directors can be involved in multiple related projects.
Service Alberta Minister Nate Glubish said that often when private equity funds make a large investment in a company they will request a seat or two on the board. At the same time, it is not uncommon for members of these funds to be involved in multiple related businesses that they have an expertise in, he said.
Under the status quo, directors would need permission from the original company they invested in before they could take on another project.
“What the concept of a corporate opportunity waiver would do is it would allow for that company who’s raising that capital to say … we can give you a very narrow and well defined waiver that says in what circumstances you could go in and make these other investments,” Glubish said.
Speeding up the process is a way to attract more business and investment to Alberta, Glubish said.
“The key thing for me is to say, well, as a government we want to try and give Alberta companies as many tools as possible to attract as much capital as possible, especially if they’re attracting it from outside of Alberta. If not having access to corporate opportunity waivers puts certain private equity or venture capital funds out of reach for them, then we’d like to give them this tool,” he said.
While Alberta would become the first jurisdiction in Canada to offer these kind of waivers, similar legislation exists in some parts of the United States.
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