CSA Increases Limit on Capital-Raising under LIFE - Greater of $25 Million and 20% of Aggregate Market Value

CSA Increases Limit on Capital-Raising under LIFE - Greater of $25 Million and 20% of Aggregate Market Value

Subject to a maximum of $50M in a 12-month period. 50% dilution limit also remains for any 12-month period. Change is effective as of May 15, 2025, pursuant to substantively coordinated blanket orders from Canadian Securities Administrators (CSA).

Listed Issuer Financing Exemption (LIFE)

If you’re a company, broker, investor or other stakeholder in the Canadian public markets, you’re likely aware of LIFE, which provides a method for listed issuers to raise capital and issue free trading shares without filing a prospectus. If you’ve used this exemption (or tried to) in the past, you may have run up against difficulties resulting from the old limits (in a 12-month period – the greater of $5 million or 10% of aggregate market value, subject to $10 million max).

The CSA has recently increased the LIFE limits in an attempt to support competitiveness of Canada’s capital markets and to help companies grow.

New Limits

Now, LIFE allows listed issuers to raise the greater of $25 million and 20 per cent of the aggregate market value of their listed securities.  Of course, certain other conditions must be met and processes must be followed to rely on the exemption. Notably, capital raises under LIFE offerings are subject to an aggregate maximum of $50 million in a 12-month period and distributions must not result in an increase of more than 50 per cent of the issuer’s outstanding listed equity securities during the period.

Please reach out to our team of lawyers at DuMoulin Black to discuss this change, plan and execute your next LIFE offering.