Shawcor Ltd. has filed a notice of intention with the Toronto Stock Exchange (the “TSX”) to commence a normal course issuer bid (the “Bid”) for common shares of the Company (the “Common Shares”), the implementation of which remains subject to TSX approval.
Pursuant to the Bid, Shawcor intends to purchase for cancellation up to 10% of Shawcor’s public float, subject to a maximum of C$25 million in aggregate repurchases of Common Shares based on the actual price paid for such repurchased Common Shares pursuant to the Bid (the “Maximum”).
If the notice is accepted by the TSX, Shawcor intends to commence the Bid on or about September 28, 2022 and the Bid will terminate one year after its commencement, or earlier if the Maximum is reached or the Bid is terminated at the option of the Company.
All purchases pursuant to the Bid will be made through the facilities of the TSX, or such other permitted means (including through alternative trading systems in Canada), at prevailing market prices or as otherwise permitted. The Bid will be funded using existing cash resources and any Common Shares repurchased by the Company under the Bid will be cancelled.
Other than purchases made under a block purchase exemption pursuant to the rules and policies of the TSX, daily purchases on the TSX pursuant to the Bid will be limited to 66,231 Common Shares, which represents approximately 25% of the average daily trading volume of 264,924 Common Shares of the Company for the most recently completed six calendar months preceding August 31, 2022.
The actual number of Common Shares which may be purchased pursuant to the Bid and the timing of any such purchases will be determined by Shawcor, subject to applicable law and the rules of the TSX.
The Company believes that the Bid is in the best interest of the Company and constitutes a desirable use of its funds to increase shareholder value and returns of the Company.
In connection with the Bid, the Company intends to enter into an automatic share purchase plan (the “Plan”) with a designated broker (the “Broker”) in order to facilitate repurchases of its outstanding Common Shares. Under the Plan, the Broker may purchase Common Shares under the Bid at times when the Company would ordinarily not be permitted to, due to its regular self-imposed quarterly black-out periods. Before the commencement of any particular internal trading black-out period, the Company may, but is not required to, instruct the Broker to make purchases of Common Shares under the Bid during the ensuing black-out period in accordance with the terms of the Plan. Such purchases will be determined by the Broker based on parameters established by the Company prior to commencement of the applicable black-out period in accordance with the terms of the Plan and applicable TSX rules. Outside of these black-out periods, Common Shares will continue to be purchasable by the Company at its discretion under its Bid. The Plan will terminate on, among other things, the earliest of the date on which: (a) the purchase limit specified in the Plan has been reached, (b) the purchase limit under the Bid has been reached, (c) the Company terminates the Plan in accordance with its terms, in which case the Company will issue a press release confirming such termination, and (d) the Bid terminates.