In 2020, the pandemic disrupted the Quebec economy and the trend continued in 2021. After a difficult year for local businesses, there is an opportunity for business owners to rethink their business model as they develop their recovery plan. In this context, an initial public offering and equity financing might be a good idea. While the process is relatively costly and time-consuming for senior management, not to mention that it results in a series of obligations for the company and its executives and major shareholders, the benefits far outweigh the disadvantages. Here are five good reasons to take your company public and use equity financing to ensure a successful future. 1. Equity financing: financing your company’s growth differently The moment your company goes public, you significantly expand and diversify your equity financing sources. You are no longer dependent on traditional bank loans. Your company can now raise capital much more easily and at a much lower cost, for example through the issuance of convertible securities, share capital, rights or warrants. In addition, your pool of funders expands considerably, going far beyond founding shareholders, your banker and your very close friends and relatives. All these equity financing tools make it possible to more aggressively manage the growth of your business and take advantage of new business opportunities. 2. Equity financing: facilitating mergers and acquisitions Having a company listed on the stock exchange means having a key advantage when it comes to your expansion plan. Once listed, you can acquire another business using your company’s shares as leverage. This added flexibility increases your chances of success in negotiations. You can thus be more bold in your growth management, as you will no longer be limited to conventional financing methods. 3. Equity financing: gaining notoriety By making the decision to take your business public and opting for equity ?nancing, you will give your business greater visibility. First, the initial public offering will be an opportunity to make your company known to investors through promotional events organized by the brokers participating in the issuance, among others. Second, public companies are often followed by ?nancial analysts, and such attention can be an asset when it comes to marketing products and services. In short, by having your company in the spotlight, it will inevitably gain notoriety, both with investors and economic partners. Finally, for many customers and suppliers, doing business with a publicly traded company is reassuring. They see it as a sign of a well-established business, and this perception can facilitate the conclusion of a sale or supply contract. 4. Equity financing: increasing the market value of your business Better ?nancing costs, greater liquidity for your company’s shares, improved growth potential and increased visibility will all make the market value of your company signi?cantly higher than it was before going public. Once listed, book value will no longer be the main indicator used to determine your company’s worth. It will be worth what investors recognize its value to be, based on its potential for growth and pro?tability and its performance relative to competitors. 5. Company succession made easier When the time comes, it will be much easier for you to retire from your business and bene?t from the fruits of your years-long effort. You will have a number of options, including disposing of your shares through a secondary offering. It will also be easier to attract talented people to take over your business because of the multiple bene?ts that come with the status of public company. The advantages of listing your company on the stock exchange and opting for equity ?nancing are many. In addition to the ?ve points presented here, we could add increased credibility with clients and suppliers, better compensation for key employees, less dilution during fundraising, and others. More companies entering the stock market will rebuild our economy. If you are thinking of transforming your company into a public one, opting for equity ?nancing and taking the plunge into the stock market, do not hesitate to call on one of our lawyers practicing in business law to guide and advise you in the process.
- Québec, 1983
René Branchaud, partner, practises in the fields of securities, mergers and acquisitions, as well as corporate law. With more than thirty years’ experience, he advises companies on matters such as incorporation and organization, the drafting of shareholder agreements, private placements, public issues, going public, dispositions, and takeovers.
His services are in demand with European entrepreneurs and investors, primarily in France, wishing to set up companies in Canada. René has acquired extensive experience in this area and the specific challenges facing companies moving to Québec. He advises businesses in all sectors of economic activity on the legal and regulatory aspects of doing business in Québec and Canada, identifying the business services they will need and assembling multidisciplinary teams to facilitate their efforts. Over the years, he has built a strong business network (bankers, financial advisers, tax experts, and accountants) that he calls upon when carrying out the mandates entrusted to him.
René acts as secretary of several publicly traded companies; he also serves on corporate governance committees and special committees established to address specific issues (mergers, takeovers).
- Advise issuers preparing public offering and private placement documents
- Advise senior management during mergers and acquisitions
- Coordinate due diligence reviews in connection with financings and mergers
- Advise securities dealers in connection with financings, mergers, and stock exchange listings
- Chambers Canada in the field of Energy and Natural Resources: Mining, since 2019
- The Best Lawyers in Canada in the fields of Mining, Natural Resources and Securities Law, since 2011
- The Best Lawyers, Lawyer of the Year, Mining Law, 2018
- The Legal 500 Canada as « Recommended Lawyer » in the area of mergers and acquisitions, 2017
- Lexpert Special Edition – Canada’s Leading Energy Lawyers in energy law, 2017
- Lexpert/Report on Business Special Edition – Corporate in corporate law in Canada, 2017
- Lexpert Guide to the Leading US/Canada Cross-Border Corporate Lawyers in the field of Natural Resources Law, 2017
- The Canadian Legal LEXPERT® Directory in the field of Corporate Finance Securities, since 2016
- The Canadian Legal LEXPERT® Directory in the field of Mining Law, since 2010
- « Lawyer of the Year in Montreal» par Best Lawyers in the field of Natural Resources Law, 2014
- LL.B., Université Laval, 1982
Boards and Professional Affiliations
- Genius Metals Inc.
- Hydroma Inc.
- Midland Exploration Inc.
- Mines Abcourt inc.
- Chairman of the Board of Director for the Opéra de Montréal
Quebec mining, oil and gas companies are henceforth subject to the imposing disclosure regime under the Act respecting transparency measures in the mining, oil and gas industries (the “Act”), which came into force last October 21. This statute echoes the Extractive Sector Transparency Measures Act (Canada),1 which took effect on June 1, 2015, and follows a global trend to increase the transparency of mining, oil and gas exploration and development. The measures provided for in the Act are aimed at discouraging and detecting corruption, as well as fostering the social acceptability of these activities. Under the Act, the companies subject to the Act are required to declare in a statement, as of the next fiscal year following their current fiscal year on October 21, 2015, the payments covered by the Act made to payees for each project and country in which they have operations. Furthermore, this obligation extends to the subsidiaries controlled by a company subject to the Act. The statements will be made public for five years. Companies subject to the Act Is subject to the Act any company which engages in exploration for or development of mineral substances or hydrocarbons and which meets any of the following requirements: its securities are listed on a stock exchange in Canada and its head office is in Quebec; or it has an establishment in Quebec, exercises activities or has assets in Quebec and, based on its consolidated financial statements, meets at least two of the following three conditions for at least one of its two most recent fiscal years: $20 million or more in assets, $40 million or more in revenue, an average of 250 employees or more. Payments covered The payments covered are monetary payments or payments in kind made to the same payee during a fiscal year, where the total value of those payments is equal to or greater than $100,000. The following payments are subject to disclosure: taxes and income tax, other than consumption taxes and personal income taxes royalties fees, including rental fees, entry fees, regulatory charges and any other consideration for licences, permits or concessions production entitlements dividends other than those paid as an ordinary shareholder of a person subject to the Act bonuses, including signature, discovery and production bonuses contributions for infrastructure construction or improvement Payees The Act defines a payee as a government, a body established by two or more governments, a municipality or an aboriginal community,2 as well as an agent exercising powers or duties for such payees. Application and administration of the Act The administration of the Act is assigned to the Autorité des marchés financiers ("AMF"). To avoid duplication, the Act provides that a statement filed in accordance with the requirements of another state may be substituted for the statement required under Quebec law if the government has determined by regulation that the requirements of that state are an acceptable substitute. The statement must be accompanied by a certificate made by an officer or director of the company subject to the Act, or by an independent auditor, attesting that the information contained in the statement is true, accurate and complete. In addition to the investigative powers generally available to the AMF under the Act respecting the Autorité des marchés financiers (chapter A-33.2), the Act gives it the power to require the communication of any document or information considered useful for purposes of the Act. This includes a list of the mining, oil or gas exploration or development projects in which the company subject to the Act has an interest, an explanation of how the disclosed payments were calculated, and a statement of any policies implemented for purposes of meeting the obligations under the Act. The AMF may also require an audit by an outside independent auditor of the statement or the documents pertaining to the disclosed payments. Penalties Lastly, significant penalties are provided for a failure to comply by a company subject to the Act. In particular, the Act provides for administrative monetary penalties for which the directors and officers are jointly and severally liable, unless they demonstrate that they exercised due care and diligence to prevent the failure which led to the penalty. In addition, the penal provisions provide for a fine of up to $250,000 for a failure to comply with certain significant provisions of the Act. Quebec mining, oil and gas companies will be well-advised to stay informed of the regulations that will be passed by the provincial government and which could provide for exceptions or extensions to the requirements of the Act regarding the companies subject to the Act, the payments covered and the payees concerned. 1 Need to Know newsletter, june 2015. 2 A transitional period is provided for regarding payments made to aboriginal communities. The Act will apply to these communities beginning on June 1, 2017.
Acceleration of filing deadline for insider reports Introduction of the concept of reporting insider; and Simplification of disclosure requirements for stock-based compensation arrangements
Avoid the use of “boilerplate” disclosure Identify the nature of any material forward-looking information as well as material factors and in the disclosure documents Avoid statements pursuant to which a reporting issuer assumes no obligation to update its statements!
On October 5, 2022, Lexpert recognized the expertise of three of our partners in its 2022 Lexpert Special Edition: Mining. Josianne Beaudry, René Branchaud and Sébastien Vézina now rank among Canada’s leaders in the area of Mining. Josianne Beaudry is a partner and leader of the Business law group at Lavery. Her practice is primarily focused on securities law. She advises financial sector participants on the application of regulations relating to securities and corporate governance. René Branchaud practises in the fields of securities, mergers and acquisitions, as well as corporate law. With more than thirty years’ experience, he advises companies on matters such as incorporation and organization, the drafting of shareholder agreements, private placements, public issues, going public, dispositions, and takeovers. Sébastien Vézina is a partner in the firm’s Business Law group. Over the years, he has refined his practice and developed a particular interest in negotiating commercial agreements with companies in the mining and renewable energy sources, financial services and sports and entertainment industries. Generally, Sébastien's practice in these different industries includes public and private mergers and acquisitions, public and private financing, private sector investments and company buyouts, in particular cross-border transactions between Canada and the United States and international transactions, and the negotiation of various commercial agreements.
On October 5, 2022, Lexpert recognized the expertise of three of our partners in its 2022 Lexpert Special Edition: Energy. Daniel Bouchard, René Branchaud and Edith Jacques now rank among Canada’s leaders in the area of energy. Daniel Bouchard specializes in the areas of municipal, environmental and administrative law. He has developed particular expertise in land-use and urban planning, agricultural zoning, environmental authorizations, municipal administration and ethics in public administration. René Branchaud practises in the fields of securities, mergers and acquisitions, as well as corporate law. With more than thirty years’ experience, he advises companies on matters such as incorporation and organization, the drafting of shareholder agreements, private placements, public issues, going public, dispositions, and takeovers. Edith Jacques is a partner in Montréal's Business law group. She specializes in mergers and acquisitions, commercial law, as well as international law and acts as business and strategic consultant to mid- and large-size companies.
Lavery has been recognized in the following fields as a leader in the 2023 edition of the Chambers Canada guide: Corporate/Commercial (Québec Band 1, Highly Regarded) Employment and Labour (Québec Band 2) Energy and Natural Resources: Mining (Nationwide, Band 4) Intellectual Property (Nationwide, Band 4) Our professionals demonstrate once again they are leaders in Chambers Canada guide 2023. René Branchaud, Nicolas Gagnon, Marie-Hélène Jolicoeur, Guy Lavoie and Sébastien Vézina have been recognized as leaders in their respective areas of practice in the 2023 edition of the Chambers Canada guide. Areas of expertise in which they are recognized: René Branchaud: Energy and Natural Resources: Mining (Nationwide, Band 5) Nicolas Gagnon : Construction (Nationwide, Band 4) Marie-Hélène Jolicoeur : Labour and Employment Law (Québec, Up and Coming) Guy Lavoie: Labour and Employment Law (Québec, Band 2) Sébastien Vézina: Energy and Natural Resources: Mining (Nationwide, Band 5) The lawyers and law firms profiled in Chambers Canada are selected following through a rigorous process of research and interviews with a broad spectrum of lawyers and their clients. The final selection is based on clearly defined criteria such as the quality of client service, legal expertise, and commercial astuteness.
Lavery is pleased to announce that 67 of its lawyers have been recognized as leaders in their respective fields of expertise by The Best Lawyers in Canada 2023. The following lawyers also received the Lawyer of the Year award in the 2023 edition of The Best Lawyers in Canada: René Branchaud : Natural Resources Law Chantal Desjardins : Intellectual Property Law Bernard Larocque : Legal Malpractice Law Patrick A. Molinari : Health Care Law Consult the complete list of Lavery's lawyers and their fields of expertise: Josianne Beaudry : Mergers and Acquisitions Law / Mining Law Laurence Bich-Carrière : Class Action Litigation / Corporate and Commercial Litigation / Product Liability Law Dominic Boivert : Insurance Law (Ones To Watch) Luc R. Borduas : Corporate Law / Mergers and Acquisitions Law Daniel Bouchard : Environmental Law Laurence Bourgeois-Hatto : Workers' Compensation Law René Branchaud : Mining Law / Natural Resources Law / Securities Law Étienne Brassard : Equipment Finance Law / Mergers and Acquisitions Law / Real Estate Law Jules Brière : Aboriginal Law / Indigenous Practice / Administrative and Public Law / Health Care Law Myriam Brixi : Class Action Litigation Benoit Brouillette : Labour and Employment Law Richard Burgos : Mergers and Acquisitions Law / Corporate Law Marie-Claude Cantin : Insurance Law / Construction Law Brittany Carson : Labour and Employment Law Eugene Czolij : Corporate and Commercial Litigation France Camille De Mers : Mergers and Acquisitions Law (Ones To Watch) Chantal Desjardins : Intellectual Property Law Jean-Sébastien Desroches : Corporate Law / Mergers and Acquisitions Law Raymond Doray : Privacy and Data Security Law / Administrative and Public Law / Defamation and Media Law Christian Dumoulin : Mergers and Acquisitions Law Alain Y. Dussault : Intellectual Property Law Isabelle Duval : Family Law Chloé Fauchon : Municipal Law (Ones To Watch) Philippe Frère : Administrative and Public Law Simon Gagné : Labour and Employment Law Nicolas Gagnon : Construction Law Richard Gaudreault : Labour and Employment Law Danielle Gauthier : Labour and Employment Law Julie Gauvreau : Intellectual Property Law Michel Gélinas : Labour and Employment Law Caroline Harnois : Family Law / Family Law Mediation / Trusts and Estates Marie-Josée Hétu : Labour and Employment Law Alain Heyne : Banking and Finance Law Édith Jacques : Energy Law / Corporate Law Pierre Marc Johnson, Ad. E. : International Arbitration Marie-Hélène Jolicoeur : Labour and Employment Law Isabelle Jomphe : Intellectual Property Law Guillaume Laberge : Administrative and Public Law Jonathan Lacoste-Jobin : Insurance Law Awatif Lakhdar : Family Law Bernard Larocque : Professional Malpractice Law / Class Action Litigation / Insurance Law / Legal Malpractice Law Myriam Lavallée : Labour and Employment Law Guy Lavoie : Labour and Employment Law / Workers' Compensation Law Jean Legault : Banking and Finance Law / Insolvency and Financial Restructuring Law Carl Lessard : Workers' Compensation Law / Labour and Employment Law Josiane L'Heureux : Labour and Employment Law Despina Mandilaras : Construction Law / Corporate and Commercial Litigation (Ones To Watch) Hugh Mansfield : Intellectual Property Law Zeïneb Mellouli : Labour and Employment Law Patrick A. Molinari : Health Care Law André Paquette : Mergers and Acquisitions Law Luc Pariseau : Tax Law Ariane Pasquier : Labour and Employment Law Jacques Paul-Hus : Mergers and Acquisitions Law Hubert Pepin : Labour and Employment Law Martin Pichette : Insurance Law / Professional Malpractice Law Élisabeth Pinard : Family Law François Renaud : Banking and Finance Law / Structured Finance Law Judith Rochette : Insurance Law / Professional Malpractice Law Ian Rose FCIArb : Director and Officer Liability Practice / Insurance Law Chantal Saint-Onge : Corporate and Commercial Litigation (Ones To Watch) Éric Thibaudeau : Workers' Compensation Law André Vautour : Corporate Governance Practice / Corporate Law / Information Technology Law / Intellectual Property Law / Technology Law Bruno Verdon : Corporate and Commercial Litigation Sébastien Vézina : Mergers and Acquisitions Law Yanick Vlasak : Corporate and Commercial Litigation Jonathan Warin : Insolvency and Financial Restructuring Law These recognitions are further demonstration of the expertise and quality of legal services that characterize Lavery’s professionals.