In Canada, the Company is a reporting issuer with its shares listed for trading on the Toronto Stock Exchange ("TSX"). As a result, the Company is subject to the corporate governance requirements of the Business Corporations Act (British Columbia) (the statute under which it is incorporated), Canadian securities laws and the Rules of the TSX). In the United States the Company's shares are listed for trading on the NYSE MKT ("MKT"). Pursuant to Section 110 of the MKT Company Guide ("Company Guide"), the Company is required to report the difference between Company Guide Sections 711 and 713 and the Canadian requirements applicable to the Company:
Shareholder Approval of Certain Transactions: The MKT Company Guide provides that shareholder approval is required as a prerequisite to approval of applications to list additional shares where the additional shares to be issued in connection with a transaction (together, if applicable, with shares sold by officers, directors or principal shareholders) is equal to 20% or more of the presently outstanding stock of the Company and the issue price is less than the greater of book or market value of the stock. The MKT Company Guide further provides that, subject to certain exceptions, shareholder approval is required for the issuance of shares in a transaction to officers and directors at below market value. The TSX Company Manual provides that shareholder approval of a private placement is generally required where the placement would materially affect control of the Company or if insiders of the Company receive consideration that is, in the aggregate, equal to or greater than 10% of the Company's market capitalization during any six month period and which has not been negotiated at arm's length. The Company may, from time-to-time offer 20% or more of the presently outstanding stock of the Company at a price less than the greater of book or market value of the stock in private placements seek and the Company will seek relief from MKT corporate governance requirements on specific transactions under Section 110 of the MKT Company Guide by providing written certification from independent local counsel that the non-complying practice is not prohibited by the Business Corporations Act or the policies of the TSX. The Company was granted an exemption from the requirements of the MKT Company Guide pursuant to Section 110 for a Series A Preferred Share private placement closed on December 13, 2012 and a unit private placement in November, 2008. Neither placement required shareholder approval by the TSX (where the Company's stock was listed at the time) or the Business Corporations Act (British Columbia).
Board of Directors: Section 802 of the MKT Company Guide provides that at least a majority of the directors on the Board of Directors of a company listed on the MKT must be independent directors as defined in Section 803A of the MKT Company Guide. Under Canadian securities laws, a company is not required to have a majority of independent directors on its Board of Directors. Section 110 of the MKT Company Guide permits a company listed on the MKT to in certain situations follow the laws, customs, and practices of the company's country of domicile, in lieu of the corporate governance requirements of the MKT. Since under the corporate governance requirements of Canadian securities law a company is not required to have a Board of Directors comprised of a majority of independent directors, the Company was granted an exemption from the requirements of Section 802 of the MKT Company Guide pursuant to Section 110 of the MKT Company Guide.