Canada Goose Holdings Inc

Headnote

Multilateral Instrument 11-102 Passport System and National Policy 11-203 Process for Exemptive Relief Applications in Multiple Jurisdictions -- Relief from the issuer bid requirements in connection with purchases by a cross-listed issuer of its shares on published markets in the U.S. as part of normal course issuer bids implemented from time to time and conducted through the facilities of the TSX in reliance on the designated exchange exemption -- the trading volume of the cross-listed issuer on U.S. markets is significant and greater than the trading volume of such issuer on the TSX -- requested relief granted, subject to conditions, including that the bid is made in compliance with applicable U.S. securities laws and any applicable rules of the published market on which purchases are carried out; purchases only occur in compliance with Part 6 (Order Protection) of NI 23-101 Trading Rules and the pricing requirement in NI 62-104; the issuer does not make purchases in reliance on section 4.8(3) of NI 62-104 if the aggregate number of shares purchased in reliance on the decision and section 4.8(3) of NI 62-104 within a 12-month period exceeds 5% of the outstanding shares on the first day of such 12-month period; the total number of shares purchased in reliance on the decision and sections 4.8(2) and (3) of NI 62-104 over the 12-month period specified in the TSX notice relating to the bid does not exceed 10% of the public float specified in such notice; and the requested relief apply only to the acquisition of shares pursuant to the issuer's current bid or one commenced within 36 months of the date of the decision.

Applicable Legislative Provisions

National Instrument 62-104 Take-Over Bids and Issuer Bids, Part 2 and s. 6.1.

January 25, 2022

IN THE MATTER OF THE SECURITIES LEGISLATION OF ONTARIO (the Jurisdiction) AND IN THE MATTER OF THE PROCESS FOR EXEMPTIVE RELIEF APPLICATIONS IN MULTIPLE JURISDICTIONS AND IN THE MATTER OF CANADA GOOSE HOLDINGS INC. (the Filer)

DECISION

Background

The principal regulator in the Jurisdiction has received an application from the Filer for a decision under the securities legislation of the Jurisdiction of the principal regulator (the Legislation) that the requirements contained in the Legislation relating to issuer bids (the Issuer Bid Requirements) shall not apply to purchases of the Filer's subordinate voting shares (the Subordinate Voting Shares) made by the Filer through the facilities of the New York Stock Exchange (the NYSE) and over alternative trading systems based in the United States (together with the NYSE, the U.S. Markets) in connection with an issuer bid made in the normal course through the facilities of the Toronto Stock Exchange (the TSX) that the Filer may implement from time to time (such bids, the Normal Course Issuer Bids, and such exemption, the Exemption Sought).

Under the Process for Exemptive Relief Applications in Multiple Jurisdictions (for a passport application):

(a) the Ontario Securities Commission is the principal regulator for this application; and

(b) the Filer has provided notice that section 4.7 (1) of Multilateral Instrument 11-102 Passport System (MI 11-102) is intended to be relied upon in British Columbia, Alberta, Saskatchewan, Manitoba, Quebec, New Brunswick, Nova Scotia, Newfoundland and Labrador, Prince Edward Island, the Northwest Territories, Nunavut and Yukon.

Interpretation

Terms defined in National Instrument 14-101 Definitions and MI 11-102 have the same meaning if used in this decision, unless otherwise defined.

Representations

This decision is based on the following facts represented by the Filer:

1. The Filer validly exists under the Business Corporations Act (British Columbia) and is in good standing. The Filer has its registered office in Vancouver, British Columbia and its principal office in Toronto, Ontario.

2. The Filer is a reporting issuer in each of the provinces and territories of Canada and is not in default of any requirement of the securities legislation in any jurisdiction of Canada.

3. The Filer is also a registrant with the Securities and Exchange Commission in the United States (the SEC) and is subject to the requirements of the United States Securities Exchange Act of 1934 (the Exchange Act).

4. The authorized capital of the Filer consists of: (i) an unlimited number of Subordinate Voting Shares, (ii) an unlimited number of multiple voting shares, and (iii) an unlimited number of preferred shares, issuable in series. As at November 1, 2021, there were 55,862,376 Subordinate Voting Shares issued and outstanding.

5. The Subordinate Voting Shares are listed and posted for trading on the TSX and the NYSE under the trading symbol "GOOS".

6. On August 13, 2021, the Filer announced that the TSX had authorized it to make a normal course issuer bid (the Current Bid) for the 12-month period ending on August 19, 2022, to purchase up to 5,943,239 Subordinate Voting Shares, representing approximately 10% of the Filer's public float as defined in the TSX Company Manual (the Public Float) and 9.98% of the issued and outstanding Subordinate Voting Shares, in each case, as of the date specified in the Notice of Intention to Make a Normal Course Issuer Bid (the Current Notice).

7. The Current Notice specifies that purchases under the Current Bid will be made through the facilities of the TSX, the NYSE or alternative trading systems, if eligible, or by such other means as may be permitted by a securities regulatory authority.

8. Purchases under issuer bids made in the normal course through the facilities of the TSX are, and will be, conducted in reliance upon the exemption from the Issuer Bid Requirements set out in subsection 4.8(2) of National Instrument 62-104 Take-Over Bids and Issuer Bids (NI 62-104, and such exemption, the Designated Exchange Exemption). The Designated Exchange Exemption provides that an issuer bid made in the normal course through the facilities of a designated exchange is exempt from the Issuer Bid Requirements if the bid is made in accordance with the bylaws, rules, regulations and policies of that exchange. The TSX is a designated exchange for the purposes of the Designated Exchange Exemption.

9. The TSX's rules governing the conduct of normal course issuer bids (the TSX NCIB Rules) are set out, inter alia, in sections 628 to 629.3 of Part VI of the TSX Company Manual. The TSX NCIB Rules permit a listed issuer to acquire, over a 12-month period commencing on the date specified in the Notice of Intention to Make a Normal Course Issuer Bid, up to the greater of (a) 10% of the Public Float as at the date specified in the Notice of Intention to Make a Normal Course Issuer Bid by the TSX, or (b) 5% of such class of securities issued and outstanding as at the date specified in the Notice of Intention to Make a Normal Course Issuer Bid by the TSX.

10. Other than purchases made pursuant to Proposed Bids (as defined below) in reliance on this decision, purchases under issuer bids made in the normal course through U.S. Markets and alternative trading systems in Canada are, and will be, conducted in reliance upon the exemption from the Issuer Bid Requirements set out in subsection 4.8(3) of NI 62-104 (the Other Published Markets Exemption). The Other Published Markets Exemption provides that an issuer bid made in the normal course on a published market, other than a designated exchange, is exempt from the Issuer Bid Requirements if, among other things, the bid is for not more than 5% of the outstanding securities of a class of securities of the issuer, and the aggregate number of securities acquired in reliance on the Other Published Markets Exemption by the issuer and any person acting jointly or in concert with the issuer within any 12-month period does not exceed 5% of the securities of that class outstanding at the beginning of the 12-month period.

11. Purchases made pursuant to the Current Bid over the U.S. Markets are not exempt under the Designated Exchange Exemption, as the U.S. Markets are not "designated exchanges" for the purpose of the Designated Exchange Exemption. As a result, purchases made pursuant to the Current Bid on the U.S. Markets, taken together with purchases made on published markets in Canada other than the TSX, cannot exceed within any 12-month period 5% of the issued and outstanding Subordinate Voting Shares at the beginning of the 12-month period, representing a number of Subordinate Voting Shares that is, and is expected to remain going forward, significantly lower than the number of Subordinated Voting Shares equal to 10% of the Public Float.

12. As at November 22, 2021, the Filer has purchased an aggregate of 3,865,136 Subordinate Voting Shares under the Current Bid. Of those 3,865,136 Subordinate Voting Shares, 2,532,518 Subordinate Voting Shares were purchased on the NYSE, 1,330,818 Subordinate Voting Shares were purchased on the TSX, and 1,800 Subordinate Voting Shares were purchased on published markets in Canada other than the TSX. Accordingly, the Filer has purchased approximately 4.26% of its issued and outstanding Subordinate Voting Shares at the commencement of the Current Bid or 65.57% of the Subordinate Voting Shares purchased under the Current Bid in reliance on the Other Published Markets Exemption.

13. For the 12-month period ended October 29, 2021, an aggregate of 287,912,823 Subordinate Voting Shares were traded over published markets in Canada and the United States, with trading volumes having occurred as follows:

(a) 74,428,337 Subordinate Voting Shares (or approximately 25.85% of total aggregate trading) over the facilities of the TSX;

(b) 47,539,536 Subordinate Voting Shares (or approximately 16.51% of total aggregate trading) over published markets in Canada other than the TSX; and

(c) 165,944,950 Subordinate Voting Shares (or approximately 57.64% of total aggregate trading) over U.S. Markets.

14. As a much higher volume of Subordinate Voting Shares have historically traded over the U.S. Markets relative to the TSX, the Filer wishes to have the ability to make repurchases in connection with the Current Bid and any Normal Course Issuer Bids that may be implemented by the Filer over the U.S. Markets (collectively, the Proposed Bids) in excess of the maximum allowable in reliance on the Other Published Markets Exemption, in order to preserve the Filer's ability to continue to repurchase Subordinate Voting Shares over the U.S. Markets up to the maximum authorized and approved by its board of directors and permissible by the TSX at a favourable cost relative to the market price of the Subordinate Voting Shares on the TSX at the relevant time.

15. The Proposed Bids will be effected in accordance with all applicable securities laws, including the Exchange Act, the U.S. Securities Act of 1933, and the rules of the SEC made pursuant thereto, and any applicable by-laws, rules, regulations or policies of the U.S. Markets on which the purchases are carried out (collectively, the Applicable U.S. Rules).

16. In connection with the Proposed Bids, the Filer also intends to rely on the "safe harbour" provided by Rule 10b-18 under the Exchange Act (Rule 10b-18) in respect of the provisions of the Exchange Act precluding market manipulation. In order for the Filer to comply with Rule 10b-18, all purchases made by or on behalf of the Filer through U.S. Markets are required (i) to be made through only one broker or dealer designated to act on behalf of the Filer, (ii) not to be made at the opening of a trading session or during the 10 minutes before the scheduled close of a trading session, (iii) not to be made at prices higher than the highest published independent bid or last reported independent transaction price on the NYSE (whichever is higher), and (iv) not to exceed, for any one day, an aggregate amount equal to 25% of the average daily trading volume over the U.S. Markets, calculated in accordance with Rule 10b-18 (provided one block purchase per week may be effected in compliance with the calculation in Rule 10b-18(b)(4)).

17. Purchases of Subordinate Voting Shares by the Filer of up to 10% of the Public Float on U.S. Markets are permitted under the Applicable U.S. Rules. Under the Applicable U.S. Rules, there is no aggregate limit on the number of Subordinate Voting Shares that may be purchased by the Filer through the facilities of U.S. Markets.

18. The purchase of Subordinate Voting Shares under the Proposed Bids will not adversely affect the Filer or the rights of any of the Filer's security holders and they will not materially affect control of the Filer.

19. The Filer believes that the Proposed Bids are in the best interests of the Filer.

20. No other exemptions exist under the Legislation that would permit the Filer to continue to make purchases pursuant to the Proposed Bids through the U.S. Markets on an exempt basis once the Filer has purchased, within a 12-month period, 5% of the outstanding Subordinate Voting Shares in reliance on the Other Published Markets Exemption.

Decision

The principal regulator is satisfied that the decision meets the test set out in the Legislation for the principal regulator to make the decision.

The decision of the principal regulator under the Legislation is that the Exemption Sought is granted provided that:

(a) the Proposed Bids are permitted under the Applicable U.S. Rules, and are established and conducted in accordance and compliance with the Applicable U.S. Rules and in reliance on Rule 10b-18;

(b) the Notice of Intention to Make a Normal Course Issuer Bid accepted by the TSX in respect of any Normal Course Issuer Bid that may be implemented by the Filer specifically contemplates that purchases under such bid will also be effected through the U.S. Markets;

(c) purchases of Subordinate Voting Shares under a Proposed Bid in reliance on this decision shall only be made:

(i) in compliance with Part 6 (Order Protection) of National Instrument 23-101 -- Trading Rules; and

(ii) at a price which complies with the requirements of paragraph 4.8(3)(c) of NI 62-104;

(d) the Exemption Sought apply only to the acquisition of Subordinate Voting Shares by the Filer pursuant to a Proposed Bid made within 36 months of the date of this decision;

(e) prior to purchasing Subordinate Voting Shares under a Proposed Bid in reliance on this decision, the Filer issues and files a press release setting out the terms of the Exemption Sought and the conditions applicable thereto;

(f) the Filer does not acquire Subordinate Voting Shares in reliance on the Other Published Markets Exemption if the aggregate number of Subordinate Voting Shares purchased by the Filer and any person or company acting jointly or in concert with the Filer in reliance on this decision and the Other Published Markets Exemption within any period of 12 months, exceeds 5% of the outstanding Subordinate Voting Shares on the first day of such 12-month period; and

(g) the aggregate number of Subordinate Voting Shares purchased pursuant to a Proposed Bid in reliance on this decision, the Designated Exchange Exemption and the Other Published Market Exemption does not exceed, over the 12-month period specified in the Notice of Intention to Make a Normal Course Issuer Bid in respect of the relevant Proposed Bid, 10% of the Public Float as specified in such Notice of Intention to Make a Normal Course Issuer Bid.

"David Mendicino"
Manager, Office of Mergers & Acquisitions
Ontario Securities Commission