Policy Statement on Timely Disclosure

particular transaction. If it seems that the situation is going to stabilize within a short period, public disclosure may be delayed until a defnitive announcement can be made. Disclosure should be made once “concrete information” is available, such as a fnal decision to proceed with the transaction or, at a later point in time, fnalization of the terms of the transaction. It is the policy of the Exchange that the withholding of material information on the basis that disclosure would be unduly detrimental to the company’s interests must be infrequent and can only be justifed where the potential harm to the company or to investors caused by immediate disclosure may reasonably be considered to outweigh the undesirable consequences of delaying disclosure, keeping in mind at all times the considerations that have given rise to the Exchange’s immediate disclosure policy. While recognizing that there must be a tradeoff between the legitimate interests of a company in maintaining secrecy and the right of the investing public to disclosure of corporate information, the Exchange discourages delaying disclosure for a lengthy period of time, since it is unlikely that confdentiality can be maintained beyond the short term. Maintaining Confdentiality If disclosure of material information is delayed, complete confdentiality must be maintained. In the event that such confdential information, or rumours respecting the same, is divulged in any manner (other than in the necessary course of business), the company is required to make an immediate announcement on the matter. IIROC must be notifed of the announcement in advance in the usual manner. During the period before material information is disclosed, market activity in the company’s securities should be closely monitored. Any unusual market activity probably means that news of the matter is being disclosed and that certain persons are taking advantage of it. In such case, IIROC should be advised immediately, and a halt in trading will be imposed until the company has made disclosure on the matter. At any time when material information is being withheld from the public, the company is under a duty to take precautions to keep such information completely confdential. Such information should not be disclosed to any ofcers or employees of the company, or to the company’s advisors, except in the necessary course of business. The directors, ofcers and employees of a listed company should be reminded on a regular basis that confdential information obtained in the course of their duties must not be disclosed. It is contrary to law under the Ontario Securities Act for any person in a “special relationship” with a company to make use of undisclosed material information. This point is discussed in the next section - Insider Trading. 13