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, up to 2,000,000 of its common shares from one of its shareholders and/or such shareholder's affiliates -- due to discounted purchase price, proposed purchases cannot be made through TSX or NASDAQ trading system -- but for the fact that the proposed purchases cannot be made through the TSX or NASDAQ 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, including that the issuer not purchase more than one-third of the maximum number of shares to be purchased under its normal course issuer bid by way of off-exchange block purchases.

Statutes Cited

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

(the "Act")

AND

IN THE MATTER OF

RESEARCH IN MOTION LIMITED

(THE FILER)

ORDER

(Section 104(2)(c))

UPON the application ("Application") of Research In Motion Limited (the "Issuer") to the Ontario Securities Commission (the "Commission") for an order under section 104(2)(c) of the Act exempting the Issuer from the requirements of sections 94 to 94.8, inclusive, and 97 to 98.7, inclusive, of the Act (the "Issuer Bid Requirements") in connection with the proposed purchase (the "Proposed Purchase") by the Issuer of up to 2,000,000 (collectively, the "Subject Shares") of its common shares (the "Common Shares") in one or more trades from Royal Bank of Canada (the "Selling Shareholder");

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

AND UPON the Issuer (and the Selling Shareholder in respect of paragraphs 9, 10, 11, 12, 13, 14 and 25 as they relate to the Selling Shareholder) having represented to the Commission that:

1. The Issuer is a corporation amalgamated under the Business Corporations Act (Ontario).

2. The registered and principal business office of the Issuer is 295 Phillip Street, Waterloo, Ontario, N2L 3W8.

3. The Issuer is a reporting issuer in each of the provinces of Canada and its Common Shares are listed for trading on the Toronto Stock Exchange ("TSX") and the NASDAQ Global Select Market ("Nasdaq"). 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 Issuer's authorized share capital consists of an unlimited number of Common Shares, an unlimited number of non-voting class A common shares, and an unlimited number of non-voting preferred shares, of which 552,511,264 Common Shares were issued and outstanding as of June 24, 2010.

5. Pursuant to a press release dated June 24, 2010 the Issuer announced a share repurchase program (the "Share Repurchase Program") pursuant to which it is authorized to purchase for cancellation up to approximately 31 million Common Shares through the facilities of the TSX and Nasdaq, subject to regulatory approval. As described below, the Issuer has obtained the requisite regulatory approvals to make purchases of Common Shares through the facilities of the TSX and additional purchases through the facilities of the Nasdaq. The Share Repurchase Program will remain in place for up to 12 months or until the purchases are completed or the program is terminated by the Issuer. Since the commencement of the Share Repurchase Program, the Issuer has purchased 9,389,700 Common Shares through the facilities of the Nasdaq.

6. Pursuant to a "Notice of Intention to Make a Normal Course Issuer Bid" filed with the TSX and dated July 12, 2010 (the "Notice"), the Issuer is permitted to make normal course issuer bid (the "Bid") purchases (each a "Bid Purchase") up to a maximum of 22,457,566 Common Shares through the facilities of the TSX and Nasdaq in accordance with sections 628 to 629.3 of Part VI of the TSX Company Manual (the "TSX Rules") during the period from July 15, 2010 to July 14, 2011.

7. On July 13, 2010, the Issuer obtained an order (the "Exemptive Relief Order") from the Commission exempting the Issuer from the Issuer Bid Requirements in respect of purchases of Common Shares made by the Issuer through the facilities of the Nasdaq pursuant to the Share Repurchase Program in excess of 5% of the Issuer's issued and outstanding Common Shares (taking into account Common Shares purchased by the Issuer in the past 12 months), provided that the purchases of Common Shares made through the facilities of the Nasdaq are part of the Bid and in compliance with the TSX Rules.

8. In addition to making Bid Purchases by means of open market transactions, the Notice contemplates that the Issuer may, subject to regulatory approval, purchase Common Shares by way of private agreement ("Off Exchange Block Purchases").

9. The Issuer intends to enter into one or more agreements of purchase and sale (each an "Agreement") with the Selling Shareholder, pursuant to which the Issuer will agree to purchase the Subject Shares from the Selling Shareholder in one or more private transactions occurring before the end of day on September 17, 2010 for a purchase price (the "Purchase Price") that will be negotiated at arms' length between the Issuer and the Selling Shareholder. The Purchase Price will be at a discount to the prevailing market price on the TSX and Nasdaq and below the prevailing bid-ask price for the Common Shares on the TSX and Nasdaq.

10. The Selling Shareholder is not the direct or indirect beneficial owner of more than 5% of the issued and outstanding Common Shares of the Issuer.

11. The head office of the Selling Shareholder is situated in the Province of Quebec. The corporate headquarters of the Selling Shareholder are situated in the Province of Ontario.

12. The Selling Shareholder is at arms' 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. The Selling Shareholder is an "accredited investor" within the meaning of National Instrument 45-106 Prospectus and Registration Exemptions.

13. The Selling Shareholder will either not be required to be registered as a dealer under the Act in connection with the sale of the Subject Shares to the Issuer or the Selling Shareholder will sell Subject Shares to the Issuer in reliance upon an exemption from the dealer registration requirements under the Act.

14. The Selling Shareholder is the beneficial owner of at least 2,000,000 Common Shares. The Subject Shares were not acquired by the Selling Shareholder in anticipation of resale to the Issuer pursuant to Off-Exchange Block Purchases.

15. The sale of any of the Subject Shares to the Issuer will not be a "distribution" (as defined in the Act).

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

17. Because the Purchase Price will be at a discount to the prevailing market price on the TSX and below the bid-ask price for the Common Shares on the TSX at the time of the Proposed Purchase, the Proposed Purchase 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 Shareholder in reliance on the exemption from the Issuer Bid Requirements that is available pursuant to section 101.2(1) of the Act.

18. Except 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 Issuer's Common Shares at the time of the Proposed Purchase, the Issuer could otherwise acquire the Subject Shares on the TSX as a block purchase in accordance with section 629(l)(7) of the TSX Rules and section 101.2(1) of the Act.

19. Except for the fact that the Purchase Price will be at a discount to the prevailing market price on the Nasdaq and below the bid-ask price for the Common Shares on the Nasdaq, the Issuer could otherwise acquire the Subject Shares on the Nasdaq within the allowable daily purchase volume of not more than 25% of the average daily trading volume reported for the Issuer's Common Shares in the four weeks preceding the day on which each such Proposed Purchase is to be made or as a block purchase in accordance with Rule 10b-18 under the U.S. Securities Exchange Act of 1934 and section 101.2(2) of the Act and the Exemptive Relief Order. Therefore, the Proposed Purchase will not occur on a "published market" in reliance upon the exemption from the Issuer Bid Requirements that is available pursuant to section 101.2(2) of the Act or the Exemptive Relief Order.

20. The Issuer is of the view that through the Proposed Purchase, the Issuer will be able to purchase the Subject Shares at a lower price than the price at which the Issuer will otherwise be able to purchase the Common Shares under the Share Repurchase Program and the Issuer is of the view that this is an appropriate use of the Issuer's funds.

21. The purchase of the Subject Shares will not adversely affect the Issuer or the right of any of the Issuer's security holders. The Proposed Purchase will not affect control of the Issuer. The Proposed Purchase will be carried out with a minimum cost to the Issuer.

22. In the past 12 months, the Issuer repurchased 18,235,800 Common Shares under a previous share repurchase program (including 2,000,000 Common Shares through an Off-Exchange Block Purchase in accordance with a Previous Order described below) and 9,389,700 Common Shares under the Share Repurchase Program, which, together with the approximately 21.87 million Common Shares remaining available for purchase under the Share Repurchase Program total 49,498,366 Common Shares, or 10% of the outstanding public float (as defined in section 628(a)(xi) of the TSX Rules). The previous purchase of 2,000,000 Common Shares through an Off-Exchange Block Purchase together with the Proposed Purchase represent approximately 8% of the 49,498,366 Common Shares.

23. The market for the 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.

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

25. At the time that an Agreement is entered into by the Issuer and the Selling Shareholder and at the time of the Proposed Purchase, neither the Issuer nor the Selling Shareholder will have knowledge of any "material change" or "material fact" (each as defined in the Act) in respect of the Issuer that has not been generally disclosed.

26. The Issuer received the relief requested herein in respect of 2,500,000 Common Shares pursuant to an order obtained from the OSC dated April 13, 2010 (the "Previous Order") and the Issuer completed a purchase pursuant thereto for 2,000,000 Common Shares in accordance with the terms of private agreements between the Issuer and a non-related third-party financial institution.

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

(a) the Proposed Purchase 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 any further "block" purchases in accordance with the TSX Rules during the calendar week it completes the 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 section 629(l)1 of the TSX Rules) of a board lot of Common Shares immediately prior to the execution of the Proposed Purchase and is not higher than the highest independent bid quotation or the last independent sale price, whichever is higher, quoted or reported in the consolidated system (as that term is defined in Rule 10b-18 under the U.S. Securities Exchange Act of 1934) at the time of the Proposed Purchase;

(d) the Issuer will otherwise acquire any additional Common Shares pursuant to the Bid and in accordance with the TSX Rules and the Exemptive Relief Order;

(e) immediately following the Proposed Purchase of the Subject Shares from the Selling Shareholder, the Issuer will report the purchase of the Subject Shares to the TSX;

(f) the Issuer will issue and file a news release disclosing the purchase of the Subject Shares;

(g) at the time that an Agreement is entered into by the Issuer and the Selling Shareholder and at the time of the Proposed Purchase, neither the Issuer nor the Selling Shareholder will have knowledge of any "material change" or "material fact" (each as defined in the Act) in respect of the Issuer that has not been generally disclosed; and

(h) the Issuer does not purchase, pursuant to Off-Exchange Block Purchases, more than one-third of 49,498,366 Common Shares prior to the expiry of the Bid.

DATED at Toronto, Ontario this 6th day of August, 2010.

"James D. Carnwath"
Commissioner
Ontario Securities Commission
 
"Carol S. Perry"
Commissioner
Ontario Securities Commission