Norale Blakes

Question 1

Plan of arrangement (1)

Answer 1

• situation where one party approaches another to discuss offer

Question 2

Takeover (1)

Answer 2

• one firm makes an offer to shareholders to sell their shares at specified price

Question 3

Advantage of Takeover bid (3)

Answer 3

• use unsolicited or friendly transaction
• ability to go directly to SH
• completed minimum of 35 days for announcement with no maximum offer

Question 4

Disadvantage of Takeover bid (3)

Answer 4

• cannot achieve 100% of ownership in one step
• identical consideration required
• cash or part of cash offer is not subject to financial conditions

Question 5

Advantage of plan of arrangement (3)

Answer 5

• permits acquisition to 100% of shares in one step
• identical consideration not required
• facilitate tax structure or unique steps

Question 6

Disadvantage of plan of arrangement (3)

Answer 6

• may take longer
• may be more difficult to amend
• require cooperation of target

Question 7

Additional procedural matter for take-over bid (4)

Answer 7

• duration of offer: least 105 days or no less than 35 days
• extension of offer: least 10 days
• minimum tender: more than 50% of outstanding securities to bid
• second step transaction

Question 8

To-hold acquisition (1)

Answer 8

• Acquisition of the securities of the target by acquirer prior to commencement of transaction process

Question 9

Advantage of toehold (3)

Answer 9

• significant toehold may dissuade other bidders
• reduce overall transaction
• gain shares to offset transaction cost if acquirer outbid

Question 10

Awareness of toehold (4)

Answer 10

• anti trust consideration
• insider status
• pre bid integration rule
• early warning requirement

Question 11

Transaction subject to MI 61-101 (4)

Answer 11

• business development
• insider bid
• issuer bid
• related party transaction

Question 12

Minority shareholder protection under MI 61-101 (3)

Answer 12

• minority SH approval
• enhance disclosure
• independent valuation

Question 13

Special committees (3)

Answer 13

• advisories all material interest of conflict transaction (mandate by MI 61-101)
• members are independent
• establish early on in process

Question 14

Disclosure should include a thorough discussion of (5)

Answer 14

• reasoning and analysis of board and special committee
• pros and cons
• alternatives
• fair opinion
• review and approval