I'm currently employed with having work permit for 3 years (IT). Other canadian company wants me to start working for them as a contractor (which means, if I accept it I have to leave my current employer according to the employment conditions).

Q1. Is it possible to reissue new/update work permit to work as a contractor for a canadian company?
Q2. If yes, what documents my new company needs to provide in this case?

Yes, you can do so. You would need to seek a new work permit outside of Canada or a change of terms inland. You would be required to submit a complete case, the requirements of which vary depending on numerous factors. It may also mean seeking a Labour Market Opinion Confirmation prior to the work permit.