BCF Securities strategic group

GUIDANCE ON FORWARD-LOOKING STATEMENT DISCLAIMERS

The Canadian Securities Administrators (the "CSA") issued, on Friday, November 20, 2009, Staff Notice 51-330 - Guidance Regarding the Application of Forward-looking Information Requirements under NI 51-102 Continuous Disclosure Obligations. In this notice, the CSA identify some common issues with disclaimers relating to forward-looking information ("FLI") contained in continuous disclosure documents. Such documents include news releases, information circulars and management's discussion & analysis.

The CSA accept the common practice of using a cautionary paragraph at the beginning or the end of a document. However, that paragraph cannot simply identify the types of words that may be found in FLI (e.g., "believes", "may", "likely" or "plans") or include a blanket statement that any disclosure relating to the future is FLI. Instead, the CSA recommend specifically identifying FLI, by stating that FLI includes statements with respect to, for example, the issuer's acquisition strategies, production goals or ability to raise capital.

The CSA further remind issuers to articulate material risk factors, material factors or assumptions used to develop material FLI. Merely stating that material risk factors, material factors and assumptions exist, without identifying them, is insufficient.

The CSA also note that alternative methods of presenting FLI may be best in some situations, for example in tabular form with a separate column identifying the FLI, another listing key assumptions and a third specifying the relevant major risk factors.

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