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 1,000,000 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 the TSX -- but for the fact that the proposed purchases cannot be made through the TSX, 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.

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

IGM FINANCIAL INC.

ORDER

(Clause 104(2)(c))

UPON the application (the "Application") of IGM Financial Inc. (the "Issuer") to the Ontario Securities Commission (the "Commission") for an order pursuant to Section 104(2)(c) of the Securities Act (Ontario) (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 purchase or purchases (the "Proposed Purchases") of up to an aggregate of 1,000,000 (the "Subject Shares") of the Issuer's common shares (the "Shares") from The Toronto-Dominion Bank and/or its affiliates (collectively, the "Selling Shareholders");

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

AND UPON the Issuer (and the Selling Shareholders in respect of paragraphs 5, 6, 7, 8, 11 and 23 as they relate to the Selling Shareholders) having represented to the Commission that:

1. The Issuer is a corporation governed by the Canada Business Corporations Act.

2. The head office of the Issuer is located at 447 Portage Avenue, Winnipeg, Manitoba, R3C 3B6.

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

4. As at November 30, 2010, the authorized common share capital of the Issuer consisted of an unlimited number of Shares, of which 260,889,525 were issued and outstanding.

5. The corporate headquarters of the Selling Shareholders are located in Toronto, Ontario.

6. The Selling Shareholders do not directly or indirectly own more than 5% of the issued and outstanding Shares.

7. The Selling Shareholders are the beneficial owner of the Subject Shares. The Subject Shares were not acquired by the Selling Shareholders in anticipation of resale pursuant to private agreements under an issuer bid exemption order issued by a securities regulatory authority ("Off-Exchange Block Purchases").

8. 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").

9. Pursuant to a "Notice of Intention to Make a Normal Course Issuer Bid" filed with the TSX and dated April 7, 2010 (the "Notice"), the Issuer is permitted to make normal course issuer bid (the "Bid") purchases (each a "Bid Purchase") to a maximum of 13,121,380 Shares from April 12, 2010 until April 11, 2011 in accordance with sections 628 to 629.3 of Part VI of the TSX Company Manual (the "TSX Rules").

10. As of November 30, 2010, 2,566,700 Shares have been purchased under the Bid, including 1,650,000 Shares purchased pursuant to Off-Exchange Block Purchases. Assuming the completion of the purchase of the Subject Shares, the Issuer will have purchased under the Bid an aggregate of 2,650,000 Shares pursuant to Off-Exchange Block Purchases, representing approximately 20% of the Shares authorized to be purchased under such Bid.

11. 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 the end of day on March 31, 2011, the Subject Shares from the Selling Shareholders for a purchase price or prices (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 Shares.

12. The Subject Shares acquired under each Proposed Purchase will constitute a "block" as that term is defined in section 628 of the TSX Rules.

13. 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 otherwise apply.

14. Because the Purchase Price will be at a discount to the prevailing market price and below the bid-ask price for the 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.

15. 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 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 Part VI of the TSX Rules and the exemption from the Issuer Bid Requirements available pursuant to Section 101.2(1) of the Act. The Notice filed with the TSX by the Issuer contemplates that purchases under the Bid may be made by such other means as permitted by the TSX, including by Off-Exchange Block Purchases.

16. 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 2.16 of NI 45-106 and Section 4.1(a) of Commission Rule 45-501 Ontario Prospectus and Registration Exemptions.

17. Management of the Issuer is of the view that it will be able to purchase of the Subject Shares at a lower price than the price at which the Issuer would be able to purchase the Shares under the Bid through the facilities of the TSX and the Issuer is of the view that this is an appropriate use of the Issuer's funds.

18. The purchase of Subject Shares will not adversely affect the Issuer, the rights of any of the Issuer's securityholders or affect control of the Issuer.

19. The Proposed Purchases will be carried out with a minimum of cost to the Issuer.

20. 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. The purchase of Subject Shares would not have any effect on the ability of other shareholders of the Issuer to sell their common shares in the market.

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

22. To the best of the Issuer's knowledge, as of November 30, 2010, the public float for the Shares represented approximately 39.49% of all the issued and outstanding Shares for purposes of the TSX Rules.

23. At the time that each Agreement is entered into by the Issuer and the Selling Shareholders and at the time of each Proposed Purchase, neither the Issuer nor the Selling Shareholders will be aware 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 UPON the Commission being satisfied that it would not be prejudicial to the public interest for the Commission to grant the requested exemption;

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 Purchases, provided that:

(a) 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(l)1 of the TSX Rules) of a board lot of Shares immediately prior to the execution of each Proposed Purchase;

(d) the Issuer will otherwise acquire any additional Shares pursuant to the Bid and in accordance with the TSX Rules, including by means of open market transactions and by other means as may be permitted by the TSX, including Off-Exchange Block Purchases;

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

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

(g) the Issuer will issue a press release in connection with the Proposed Purchases; and

(h) the Issuer does not purchase, pursuant to Off-Exchange Block Purchases, more than one-third of the maximum number of Shares the Issuer can purchase under the Bid.

DATED at Toronto this 14th day of December, 2010.

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