RE:RE:RE:RE:RE:Penalty 20mm oem40 mMy views only:
The posting dated March 19 at 239pm includes an excerpt from page 83 of the Circular and concerns the risk that regulatory approval may not be approved. Whle it summarizes, the Circular is not the legal agreement.
Sections 4.3 and 4.4 of the Arrangement Agreement (see Sedar, June 28) are what govern.
At 4.3(1):
"The Purchaser shall perform all obligations required or desirable to be performed by the Purchaser under this Agreement, cooperate with the Corporation in connection therewith, and do all such other commercially reasonable acts and things as may be necessary or desirable to consummate and make effective, as soon as reasonably practicable, the transactions contemplated by this Agreement and, without limiting the generality of the foregoing, the....."
The key words may be the words "...do all such other commercially reasonable acts and things...". This may require AC to agree to any reasonable concession the reulator requires before giving approval. This may mean that if AC fails to do so, the breach he Agreement.
Section 4.4 also applies, but does not over-ride or cancel the key words above.
At 4.4(1): "The Parties shall, as promptly as practicable, prepare and file all necessary documents, registrations, statements, petitions, filings and applications required to obtain the Key Regulatory Approvals and the Other Regulatory Approvals and use their commercially reasonable efforts to obtain as promptly as practicable and maintain all Key Regulatory Approvals and Other Regulatory Approvals....."
At 4.4(4), which appears to be the basis for the wording at page 83 of the Crcular, :
"The Purchaser, acting reasonably and diligently, and after consultation with the Corporation, will determine and direct, except as prohibited by applicable Law, the efforts to obtain the Key Regulatory Approvals and the Other Regulatory Approvals, including leading all communications and strategy relating to such efforts, provided, for greater certainty, that such authority does not affect, alter or mitigate the Purchaser's obligation to comply with its covenants in this Section 4.4. For greater certainty, in no circumstances shall the Corporation state or suggest that the Purchaser is prepared to provide or agree to any undertakings, conditions or remedies in connection with obtaining any Key Regulatory Approval or Other Regulatory Approval, without the prior consent of the Purchaser."
Note the above refers to the requirement to comply with the covenants in this section 4.4.
I am assuming there is no Material Adverse Effect out of the deal, on the basis/ assumption that TRZ is not disproportionately negatively affected by the airline slow down.
I may be wrong, but think that if you fail to read sections 4.4 and 4.5 as I am doing, AC would have an easy out in the event of a material adverse effect on the industry as a whole by simply refusing to make any concession the regulator may require. AC an TRZ entered the deal expecting some concessions would be required. If the Agreement will allow AC to effcetively say no by not agreeing to reasonable concessions, then the wording of the "material adverse effect" is meaningless or has no teeth. I personally think that would make not make sense.