In the Matter of the Securities Legislation of the Province of Ontario (the Jurisdiction) and In the Matter of the Process for Exemptive Relief Applications in Multiple Jurisdictions and In the Matter of Bitfarms Ltd. (the Filer)
January 8, 2026
Decision
Background
The principal regulator in the Jurisdiction has received an application from the Filer for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) exempting the Filer from the requirement in clause (g)(i) of the definition of “eligible issuer” in subsection 9B.1(1) of National Instrument 44-102 Shelf Distributions (NI 44-102) that an issuer must not, during the preceding three years, have been the subject of a cease trade order or order similar to a cease trade order in a jurisdiction of Canada that was in effect for a period of more than 30 consecutive days (the CTO Eligibility Condition) in order to be eligible for the well-known seasoned issuer (WKSI) regime in Part 9B of NI 44-102 (the Exemption Sought).
Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):
(a) the Ontario Securities Commission is the principal regulator for the application; and
(b) the Filer has provided notice that subsection 4.7(1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in the Provinces of Alberta, British Columbia, Manitoba, New Brunswick, Newfoundland and Labrador, Northwest Territories, Nova Scotia, Nunavut, Prince Edward Island, Québec, Saskatchewan and Yukon.
Interpretation
Terms defined in National Instrument 14-101 Definitions, MI 11-102 and NI 44-102 have same meaning if used in this decision, unless otherwise defined.
Representations
This decision is based on the following facts represented by the Filer:
The Filer is incorporated under the laws of Canada, with its registered and head office located at 110 Yonge Street, Suite 1601, Toronto, Ontario, M5C 1T4.
The Filer’s primary business is the mining of cryptocurrency tokens.
The Filer is a reporting issuer in each of the jurisdictions of Canada and is not in default of the securities legislation of any jurisdiction.
The Filer’s authorized share capital consists of an unlimited number of Common Shares without par value and an unlimited number of Class A Preferred Shares without par value. As of January 5, 2026, the Filer had 601,583,749 Common Shares outstanding and no Class A Preferred Shares outstanding.
The Common Shares are listed for trading on the Toronto Stock Exchange and on the Nasdaq Stock Market under the symbol “BITF”.
In June 2024, the Filer adopted a shareholder rights plan (the Plan) as a defensive measure in response to an anticipated hostile takeover bid from Riot Platforms, Inc. (Riot). The Plan included a “trigger” at 15%, meaning that the acquisition by any person of more than 15% of the outstanding Common Shares of the Filer would trigger the provisions of the Plan, such that all shareholders of the Filer, except the shareholder that triggered the Plan, would become entitled to purchase from the Filer additional Common Shares at half of the prevailing market price. At the time of adoption of the Plan, Riot owned approximately 14% of the outstanding Common Shares of the Filer.
On July 24, 2024, following an application from Riot, the Ontario Capital Markets Tribunal issued a cease trade order in respect of the Plan (the Plan CTO), on the basis that the 15% trigger in the Plan was not consistent with the 20% threshold for a take-over bid in National Instrument 62-104 Take-Over Bids and Issuer Bids.
The Plan CTO was limited in scope and did not affect the trading of any other securities of the Filer.
The Plan CTO did not arise from any deficiency in the Filer’s continuous disclosure record, financial reporting or internal controls.
Other than the Plan CTO, the Filer has not during the preceding 3 years been the subject of any cease trade order or order similar to a cease trade order in a jurisdiction of Canada that was in effect for a period of more than 30 consecutive days.
Pursuant to the CTO Eligibility Condition, an issuer is not eligible to use the WKSI regime in Part 9B of NI 44-102 if it has, during the preceding 3 years, been the subject of a cease trade order or similar order in a jurisdiction of Canada that was in effect for a period of more than 30 consecutive days.
Without the Exemption Sought, the Plan CTO would prevent the Filer from satisfying the CTO Eligibility Condition for a period of three years from the issuance of the Plan CTO, during which time the Filer would be ineligible to use the WKSI regime in Part 9B of NI 44-102.
The Filer satisfies each clause of the definition of “eligible issuer” in subsection 9B.1(1) of NI 44-102 but for the CTO Eligibility Condition, and satisfies the CTO Eligibility Condition but for the Plan CTO.
Decision
The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.
The decision of the principal regulator under the Legislation is that the Exemption Sought is granted provided that:
(a) at the date of filing of any WKSI base shelf prospectus or any amendment thereto, the Filer:
(i) meets each clause of the definition of “eligible issuer” in subsection 9B.1(1) of NI 44-102 but for the CTO Eligibility Condition,
(ii) meets the CTO Eligibility Condition but for the Plan CTO, and
(iii) complies with all of the applicable requirements of Part 9B of NI 44-102, except as modified in this decision;
(b) the Filer complies with all of the applicable requirements of:
(i) NI 44-102, except as modified in this decision, and
(ii) National Instrument 44-101 Short Form Prospectus Requirements;
(c) the Filer includes on the cover page of any WKSI base shelf prospectus or amendment thereto a modified version of the statement required under paragraph 9B.2(3)(a) or subparagraph 9B.5(2)(b)(i) of NI 44-102, as applicable, that includes, in addition to the prescribed information:
(i) a statement that the Filer would be eligible to file a WKSI base shelf prospectus under subsection 9B.2(1) of NI 44-102 but for the Plan CTO, and
(ii) details of the Exemption Sought and this decision;
(d) the Filer files with any WKSI base shelf prospectus or amendment thereto a modified version of the certificate required under subsection 9B.4(1) of NI 44-102, that includes, in addition to the prescribed information:
(i) a statement that the Filer would be eligible to file a WKSI base shelf prospectus under subsection 9B.2(1) of NI 44-102 but for the Plan CTO, and
(ii) details of the Exemption Sought and this decision;
(e) any WKSI base shelf prospectus of the Filer includes a clear, plain-language description of:
(i) the Plan CTO, and
(ii) the Exemption Sought and this decision;
(f) the Filer includes in its annual information form for the financial year ended immediately before the annual filing date, or in an amendment to a WKSI base shelf prospectus, a modified version of the statement required under paragraph 9B.6(1)(a) that includes the following, in addition to the prescribed information:
(i) a statement that the Filer would be eligible to file a WKSI base shelf prospectus under subsection 9B.2(1) of NI 44-102 but for the Plan CTO, and
(ii) a description of the Exemption Sought and this decision; and
(g) this decision will terminate on July 25, 2027.
“David Surat”
David Surat
Associate Vice President, Corporate Finance
Ontario Securities Commission OSC File #: 2025/0700