OTCPK:ARNBF - Post by User
Comment by
skeksison Jul 01, 2014 12:49am
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Post# 22707433
RE:RE:RE:one step at a time....
RE:RE:RE:one step at a time....OK, I tried to verify this with the TSX venture exchange requirements I could find on their site.
So this document says shareholder approval is required if a debt for shares exchange creates a new Control Person:
https://www.tmx.com/en/pdf/Policy4-3.pdf
And a Control Person is defined here as a >20% owner of the stock:
https://www.tmx.com/en/pdf/Policy1-1.pdf
So it seems like the debenture conversion would require shareholder approval only if it resulted in a new party owning >20% of the stock. So this might or might not happen depending on the conversion price and who owns what % of the debs and how much stock they have already. Sort of complicated.
Of course the creation of a new Control Person would also have the effect of triggering the poison pill, so most likely the debenture holder would sell their debs or common stock to avoid this situation. If there was going to be a poison pill triggering, I think the shareholders would have no problem approving the transaction because they could get more stock at a discount. Also the rights exercise after the poison pill would help delever the company.