LAKE SHORE GOLD CORP 6.25 PCT DEBS T.LSG.DB

RE:RE:Termination Fee

[epiphany2]

I took a look on Wikipedia and grabbed this segment about termination feed (specifically regarding mergers and acquisitions):

In mergers and acquisitions termination fees are often levied in the event that one party fails to consummate a merger—for instance, because it was unsuccessful in getting shareholder approval or because it agreed to a competing offer. For instance, in 2005Johnson & Johnson agreed to acquire Guidant, but Guidant later accepted a competing offer and was subject to a termination fee of $705 million.

These termination fees have been criticized as well. Shareholders in companies being purchased sometimes believe that termination fees are too high, and instead of representing the costs that the purchasing party would suffer should the deal fall through, instead act as a way of forcing shareholders and directors to accede to the deal.