Securities Law & Instruments

Headnote

Clause 104(2)(c) -- Issuer bid -- relief from issuer bid requirements in sections 94 to 94.8 and 97 to 98.7 of the Act -- Issuer proposes to purchase, at a discounted purchase price, approximately 10,000,000 of its Class B Non-Voting Participating shares from two shareholders and/or their affiliates -- due to discounted purchase price, proposed purchases cannot be made through TSX trading system -- but for the fact that the proposed purchases cannot be made through the TSX trading system, the Issuer could otherwise acquire the subject shares in reliance upon the issuer bid exemption available under section 101.2 of the Act and in accordance with the TSX rules governing normal course issuer bid purchases -- no adverse economic impact on or prejudice to issuer or public shareholders -- proposed purchases exempt from issuer bid requirements in sections 94 to 94.8 and 97 to 98.7 of the Act, subject to conditions.

Applicable Legislative Provisions

Securities Act, R.S.O. 1990, c. S.5, as am., ss. 94 to 94.8, 97 to 98.7, 104(2)(c).

IN THE MATTER OF

THE SECURITIES ACT,

R.S.O. 1990, c.S.5, AS AMENDED

AND

IN THE MATTER OF

SHAW COMMUNICATIONS INC.

ORDER

(Clause 104(2)(c))

UPON the application (the "Application") of Shaw Communications Inc. (the "Issuer") to the Ontario Securities Commission (the "Commission") for an order pursuant to clause 104(2)(c) of the Act exempting the Issuer from the requirements of sections 94 to 94.8 and 97 to 98.7 of the Act (the "Issuer Bid Requirements") in connection with the proposed purchases ("Proposed Purchases") by the Issuer of up to 10,000,000 of its Class B Non-Voting Participating Shares (the "Class B Shares") from one or more of (i) the Royal Bank of Canada (or one of its affiliates) and (ii) The Toronto-Dominion Bank (or one of its affiliates) (collectively, the "Selling Shareholders"), subject to maximum aggregate proposed purchases totalling 10,000,000 Class B Shares (the "Subject Shares");

AND UPON considering the Application and the recommendation of staff of the Commission;

AND UPON the Issuer having represented to the Commission that:

1. The Issuer is a corporation governed by the Business Corporations Act (Alberta).

2. The head office and registered office of the Issuer are located at Suite 900, 630 -- 3rd Avenue SW, Calgary, Alberta, T2P 4L4.

3. The Issuer is a reporting issuer in each of the provinces of Canada and the Class B Shares are listed for trading on the Toronto Stock Exchange (the "TSX") and the New York Stock Exchange. The Issuer is not in default of any requirement of the securities legislation in the jurisdictions in which it is a reporting issuer.

4. The authorized share capital of the Issuer consists, among others, of an unlimited number of Class B Shares, of which 414,218,183 Class B Shares were issued and outstanding as of October 30, 2009.

5. The executive head office of each Selling Shareholder is located in Toronto, Ontario.

6. The Selling Shareholders have advised the Issuer that they do not directly or indirectly own more than 5% of the issued and outstanding Class B Shares.

7. To the knowledge of the Issuer after reasonable enquiry, the Selling Shareholders own the Subject Shares and the Subject Shares were not acquired in anticipation of resale pursuant to the Proposed Purchases.

8. Pursuant to a "Notice of Intention to Make a Normal Course Bid" filed with the TSX and dated November 12, 2009 (the "Notice"), the Issuer is permitted to make normal course issuer bid (the "Bid") purchases (each a "Bid Purchase") up to a maximum of 35,000,000 Class B Shares in accordance with sections 628 to 629.3 of Part VI of the TSX Company Manual (the "TSX Rules") during the period from November 19, 2009 to November 18, 2010. To date, no Class B Shares have been purchased under the Bid.

9. In addition to making Bid Purchases by means of open market transactions, the Notice contemplates that the Issuer may purchase Class B Shares by way of exempt offer.

10. The Issuer and the Selling Shareholders intend to enter into one or more agreements of purchase and sale (the "Agreement"), pursuant to which the Issuer will agree to acquire, by one or more trades, occurring prior to February 28, 2010, the Subject Shares from the Selling Shareholders for a purchase price (the "Purchase Price") that will be negotiated at arm's length between the Issuer and the Selling Shareholders. The Purchase Price will be at a discount to the prevailing market price and below the prevailing bid-ask price for the Class B Shares at the time of each Proposed Purchase.

11. The purchase of the Subject Shares by the Issuer pursuant to the Agreement will constitute an "issuer bid" for purposes of the Act, to which the Issuer Bid Requirements would apply.

12. Because the Purchase Price will be at a discount to the prevailing market price and below the bid-ask price for the Class B Shares at the time of each trade, the Proposed Purchases cannot be made through the TSX trading system and, therefore, will not occur "through the facilities" of the TSX. As a result, the Issuer will be unable to acquire the Subject Shares from the Selling Shareholders in reliance upon the exemption from the Issuer Bid Requirements that is available pursuant to Section 101.2(1) of the Act.

13. But for the fact that the Purchase Price will be at a discount to the prevailing market price and below the bid-ask price for the Class B Shares at the time of the trade, the Issuer could otherwise acquire the Subject Shares as a "block" purchase (a "Block Purchase") in accordance with Section 629(l)7 of the TSX Rules and Section 101.2(1) of the Act.

14. Each of the Selling Shareholders is at arm's length to the Issuer and is not an "insider" of the Issuer, an "associate" of an "insider" of the Issuer, or an "associate" or "affiliate" of the Issuer, as such terms are defined in the Act. In addition, each Selling Shareholder is an "accredited investor" within the meaning of National Instrument 45-106 Prospectus and Registration Exemptions ("NI 45-106").

15. The Issuer will be able to acquire the Subject Shares from the Selling Shareholders in reliance upon the exemption from the dealer registration requirements of the Act that is available as a result of the combined effect of section 3.16 of NI 45-106 and Section 4.1(a) of Commission Rule 45-501 Ontario Prospectus and Registration Exemptions.

16. Management of the Issuer is of the view that the purchase the Subject Shares at a lower price than the price at which the Issuer will be able to purchase the Class B Shares under the Bid is an appropriate use of the Issuer's funds.

17. The purchase of Subject Shares will not adversely affect the Issuer or the rights of any of the Issuer's securityholders. As the Subject Shares are non-voting shares, the Proposed Purchases will not affect control of the Issuer. The Proposed Purchases will be carried out with a minimum of cost to the Issuer.

18. To the best of the Issuer's knowledge, as of October 30, 2009, the public float for the Class B Shares represented approximately 90% for purposes of the TSX Rules.

19. The market for the Class B Shares is a "liquid market" within the meaning of section 1.2 of Multilateral Instrument 61-101 Protection of Minority Security Holders in Special Transactions. The purchase of the Subject Shares would not have any effect on the ability of the other shareholders of the Issuer to sell their Class B Shares in the market.

20. Other than the Purchase Price, no additional fee or other consideration will be paid in connection with the Proposed Purchases.

21. At the time that the Agreement is entered into by the Issuer and the Selling Shareholders and at the time of the Proposed Purchases, neither the Issuer nor the Selling Shareholders will be aware of any "material change" or any undisclosed "material fact" (each as defined in the Act) in respect of the Issuer that has not been generally disclosed.

AND UPON the Commission being satisfied to do so would not be prejudicial to the public interest;

IT IS ORDERED pursuant to clause 104(2)(c) of the Act that the Issuer be exempt from the Issuer Bid Requirements in connection with the Proposed Purchases, provided that:

(a) the Proposed Purchases will be made during the currency of the Bid and the Proposed Purchases will be taken into account by the Issuer when calculating the maximum annual aggregate limit for the Bid Purchases in accordance with the TSX Rules;

(b) the Issuer will refrain from conducting a Block Purchase in accordance with the TSX Rules during the calendar week it completes each Proposed Purchase and may not make any further Bid Purchases for the remainder of that calendar day;

(c) the Purchase Price is not higher than the last "independent trade" (as that term is used in paragraph 629(1)1 of the TSX Rules) of a board lot of Class B Shares immediately prior to the execution of each Proposed Purchase;

(d) the Issuer will otherwise acquire any additional Class B Shares pursuant to the Bid and in accordance with the TSX Rules;

(e) immediately following its purchase of the Subject Shares from the Selling Shareholders, the Issuer will report the purchase of the Subject Shares to the TSX and issue and file a news release disclosing the purchase of the Subject Shares; and

(f) at the time that the Agreement is entered into by the Issuer and the Selling Shareholders and at the time of the Proposed Purchases, neither the Issuer nor the Selling Shareholders will be aware of any "material change" or any undisclosed "material fact" (each as defined in the Act) in respect of the Issuer that has not been generally disclosed.

Dated at Toronto this 19th day of November, 2009

"Carol S. Perry"
Commissioner
Ontario Securities Commission
 
"Mary Condon"
Commissioner
Ontario Securities Commission