RE: Nord locks up more shares We have not seen the "lock-up" agreement, as usual Nordgolf (Mordashov) is just being a bully. The last time, it was "HRG might not surviv", late filings, change in CEO, CFO, BO! Bring it on Mordy! Let's see the offer, he will "huff and puff and blow himself up".
LOCK-UP AGREEMENTS
• Security holder's commitment to tender into offeror's take-over bid (or vote in support of arrangement or amalgamation)
• Negotiate security holder's right to withdraw and tender to higher offer
• Advantage: contributes to certainty of execution; locked-up securities count towards 90% compulsory acquisition threshold
• Disadvantage: risk offeror cannot count securities acquired under lock-up agreement in majority of minority vote on second-step going private transaction if the locked-up security holder is not treated identically to all other security holders under offer
• Multilateral Instrument 61-101 permits locked-up securities to be voted as part of the minority if the locked-up security holder is treated identically to all other security holders under offer
• Entering into of the lock-up agreement may trigger target's poison pill
• Lock-up agreements must be filed publicly
Squeeze- OUT
• Under corporate law, if within 120 days of bid, bid is accepted by 90% of class
of shares subject to bid (other than shares held by bidder or its affiliates or
associates), bidder can require hold-outs to sell to bidder for same price as bid
• Once notice is sent, bidder will be entitled to acquire share of non-tendering
shareholders within 30 days but each shareholder may apply to court to fix
"fair value" • For corporations incorporated federally or in Ontario, procedure is only available if bid was for voting securities
• For corporations incorporated federally, procedure is only available if the bid is
made to all shareholders (e.g., cannot exclude U.S. holders in share exchange
bid) unless an order is obtained
TAKE-OVER BID
90% of all shares outstanding (in order to force out the remainder). If less than 90% acquired, must do second stage squeezeout, requiring 2/3 vote and majority of minority vote (locked-up shares can be counted as part of minority if identical treatment)