On March 11, 2024, the Ontario Capital Markets Tribunal Tribunal released its reasons for dismissing Mithaq Capital Inc. s Mithaq application on December 14, 2023, to cease trade a private placement that Aimia Inc. Aimia completed in October 2023. Mithaq asserted that the private placement was conducted as an improper defensive tactic under National Policy 62-202 Take-Over Bids Defensive Tactics of the Canadian Securities Administrators and was designed to thwart Mithaq s then-recently launched takeover bid for Aimia. Ultimately, the Tribunal found that the private placement was conducted for a legitimate business purpose to meet Aimia s serious and immediate financing needs.
In a recent decision, Kraft Re Kraft, the Ontario Capital Markets Tribunal the Tribunal articulated clear guidance with respect to the application of the necessary course of business NCOB exception to the prohibition against selective disclosure or tipping contained in the Ontario Securities Act the OSA. This decision is significant insofar as it clarifies how rules surrounding tipping are to be interpreted and applied, and establishes a clearer framework as to how issuers and insiders should navigate their obligations with respect to material non-public information MNPI.