Issue link: https://www.e-digitaleditions.com/i/1238652
Lawson Lundell LLP 47 Break Free Payable by the Target 52. What is the amount of the Target's break fee? (a) Less than $1M (16%) (b) $1M - $5M (49%) (c) $6M - $99M (30%) (d) $100M+ (5%) 53. What is the amount of the Target's break fee as a percentage of the equity value of the transaction? (a) Less than 1% (5%) (b) 1-2% (33%) (c) 3-4% (36%) (d) 5%+ (26%) 54. When is the Target required to pay a break fee to the Purchaser (after the transaction has been terminated by either of them)? Standard (80%+) The Target's board changes its recommendation Common (41-79%) Target proposes to implement a Superior Proposal An alternative acquisition proposal for the Target is announced and the Target's shareholders reject the Purchaser's transaction The Target's board fails to publicly reaffirm any of its recommendations regarding the offer in conditions where the agreement requires affirmation The Target breaches any representations or covenants and the breach results in a material adverse effect, or renders the Target unable to satisfy a closing condition Uncommon (10-40%) The Target breaches any material representations or covenants An alternative acquisition proposal for the Target is announced and the Purchaser's transaction is not approved by the outside date Rare (less than 10%) The Target commits a material breach of the no shop covenants The Target does not hold its shareholder meeting by the outside date The Target does not satisfy a working capital requirement The Target breaches any representation or covenant, without a material adverse effect The Target commits a breach of the no shop covenants Target's shareholders reject the transaction 55. If the Target's shareholders defeat the transaction (by vote or tender) and there is no alternative transaction in the market, does the Purchaser get any compensation? (a) No compensation paid to the Purchaser (80%) (b) Target pays Purchaser's expenses (7%) (c) Target pays break fee to Purchaser (12%)