OSC | OSC Proceedings - Before the Commission

IN THE MATTER OF THE SECURITIES ACT
R.S.O. 1990, C. S.5, AS AMENDED

- AND -

IN THE MATTER OF
SEARS CANADA INC.,
SEARS HOLDINGS CORPORATION,
AND SHLD ACQUISITION CORP.

- AND -

IN THE MATTER OF
HAWKEYE CAPITAL MANAGEMENT, LLC,
KNOTT PARTNERS MANAGEMENT, LLC, and
PERSHING SQUARE CAPITAL MANAGEMENT, L.P.

TORONTO – On August 8, 2006, the Commission issued its Reasons and Decision and made an Order (the “Cease Trade Order”) pursuant to subsections 104(1) and 127(1) of the Act that the offer to acquire (the “Offer”) made by Sears Holdings Corporation and SHLD Acquisition Corp. (collectively, the “Offerors”) for all of the outstanding common shares of Sears Canada Inc. (the “Common Shares”) be cease-traded until certain conditions are satisfied.

By notice of appeal dated August 9, 2006, the Offerors have appealed to the Ontario Superior Court of Justice (Divisional Court) to set aside the Cease Trade Order.

By an application dated August 24, 2006 (the “Application”), the Offerors requested that the Commission confirm that the Cease Trade Order does not restrict the Offerors from (a) extending the Offer from time to time in the discretion of the Offerors to preserve the Offerors’ rights pending the outcome of the appellate process in relation to the Cease Trade Order, and (b) making certain additional amendments to the Offer, as particularized in the Application and the attachment thereto.

Today, on consent of all the parties, the Commission made an Order which provides that the Cease Trade Order is stayed to the extent necessary only to permit the Offerors to amend the Offer to acquire all of the outstanding common shares of Sears Canada Inc. by extending the expiry time of the Offer until the appellate process in relation to the Cease Trade Order has been exhausted. The Offerors’ request to stay the Cease Trade Order to permit the making of the additional amendments to the Offer was dismissed.

A copy of the Order is available at www.osc.gov.on.ca.


OFFICE OF THE SECRETARY
JOHN P. STEVENSON
SECRETARY