ANNUAL INFORMATION FORM Fiscal year ended August 31, 2011 Corus Entertainment Inc. October 31, 2011 ANNUAL INFORMATION FORM ‐ CORUS ENTERTAINMENT INC. Table of Contents FORWARD‐LOOKING STATEMENTS ........................................................................................................ 3 INCORPORATION OF CORUS .................................................................................................................. 4 Organization and Name ............................................................................................................................ 4 Subsidiaries ............................................................................................................................................... 5 GENERAL DEVELOPMENT OF THE BUSINESS ........................................................................................... 5 Significant Acquisitions and Divestitures ................................................................................................. 5 DESCRIPTION OF THE BUSINESS ............................................................................................................. 6 Radio ......................................................................................................................................................... 6 Description of the Industry ................................................................................................................ 6 Competitive Conditions ..................................................................................................................... 7 Business Overview ............................................................................................................................. 7 Operating Strategy ............................................................................................................................. 10 Television .................................................................................................................................................. 11 Description of the Industry ................................................................................................................ 11 Competitive Conditions ..................................................................................................................... 13 Business Overview ............................................................................................................................. 15 Operating Strategy ............................................................................................................................. 18 ADDITIONAL INFORMATION CONCERNING CORUS’ BUSINESSES ............................................................ 20 Intangible Properties ................................................................................................................................ 20 Seasonality and Cycles .............................................................................................................................. 20 Economic Dependence ............................................................................................................................. 21 Environmental Protection ........................................................................................................................ 21 Employees ................................................................................................................................................ 21 Foreign Operations ................................................................................................................................... 21 Lending ..................................................................................................................................................... 21 Bankruptcy................................................................................................................................................ 21 Reorganizations ........................................................................................................................................ 21 Social or Environmental Policies .............................................................................................................. 22 Risk Factors ............................................................................................................................................... 22 Control of Corus by the Shaw Family ....................................................................................................... 22 CANADIAN COMMUNICATIONS INDUSTRY – REGULATORY ENVIRONMENT .............................................. 22 Canadian Radio‐television and Telecommunications Commission .......................................................... 22 Industry Canada ........................................................................................................................................ 23 Restrictions on Non‐Canadian Ownership ............................................................................................... 23 Broadcasting Services ............................................................................................................................... 23 Radio Undertakings .................................................................................................................................. 24 Specialty and Pay Television Networks Undertakings .............................................................................. 24 Canadian Content Requirement for Broadcasters ................................................................................... 25 Film and Television Tax Credits and Grants ............................................................................................. 25 International Treaty Co‐Productions ........................................................................................................ 25 Competition Act Requirements ................................................................................................................ 26 Investment Canada Act ............................................................................................................................ 26 Copyright Act Requirements .................................................................................................................... 26 CAPITAL STRUCTURE .............................................................................................................................. 27 Description of Capital Structure ............................................................................................................... 27 Share Constraints ..................................................................................................................................... 31 Ratings ...................................................................................................................................................... 31 MARKET FOR SECURITIES ....................................................................................................................... 32 Marketplace ............................................................................................................................................. 32 2 Trading Price and Volume ........................................................................................................................ 32 DIVIDEND POLICY ................................................................................................................................... 33 NORMAL COURSE ISSUER BID ................................................................................................................ 34 DIRECTORS ............................................................................................................................................ 35 OFFICERS ............................................................................................................................................... 36 AUDIT COMMITTEE ................................................................................................................................ 37 Charter ...................................................................................................................................................... 37 Composition of the Audit Committee ...................................................................................................... 37 Principal Accounting Fees and Services – Independent Auditors ............................................................ 37 LEGAL AND REGULATORY ....................................................................................................................... 38 INTERESTS OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS ............................................ 38 TRANSFER AGENTS................................................................................................................................. 38 MATERIAL CONTRACTS .......................................................................................................................... 39 Senior Secured Credit Facility ................................................................................................................... 39 Trust Indenture for 7.25% Senior Unsecured Guaranteed Notes due 2017 ............................................ 40 INTERESTS OF EXPERTS .........................................................................................................................