Suppose that fairfax lowers the offer to $8
Then Mike and Doug offer $9
Does blackberry still have to pay the $0.30 per share to fairfax?
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Suppose that fairfax lowers the offer to $8
Then Mike and Doug offer $9
Does blackberry still have to pay the $0.30 per share to fairfax?
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No. It's only payable if a deal is agreed to which Fairfax is not a part of.
Sent from my HTC One using CB Forums mobile app
Perhaps my question was unclear.
I'm talking about a scenario in which fairfax makes a bid which is below the original $9 offer
Then they get outbid by Mike and Doug, or some other party
Does blackberry still pay the fee, or does that no longer apply because fairfax changed their offer?
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If anybody else than Fairfax has the deal, BlackBerry has to pay them 0,30$ per share, yes.
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I would have to think it's tied to the original $9 offer. Otherwise Fairfax could come back and offer a penny a share and pocket $150M or whatever it is.
If someone else signs a deal with BlackBerry while Fairfax is completing its due dilligence, then BlackBerry has to pay the $0.30/share fee.
If someone else signs a deal with BlackBerry after Fairfax has signed a deal with BlackBerry, then BlackBerry has to pay a $0.50/share fee to void the the Fairfax/BlackBerry deal.
If Fairfax completes its due dilligence and backs out, then BlackBerry doesn't pay any fee.
A lot of people have suggested that fairfax will be able to put together an offer but that they won't be able to convince other investors to go in on it for $9
From my reading of the news release it seems pretty unclear whether that fee would still apply if they changed the offer
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From the LOI re the .30 fee:
"no such fee shall be payable if the Consortium shall have reduced the price offered below U.S. $9.00 per share without the approval of the board of directors of the Company."
No fee will apply if the bid is lower, BUT a fee will apply, if they lower the bid BUT with the agreement of BBRY to lower the bid.
According to the press release, if Fairfax lowers the price without board approval the fee is void.
"BlackBerry enters into any agreement providing for an Alternative Transaction with a person with whom discussions were held before or during the Diligence Period, then BlackBerry shall pay Fairfax a fee of U.S. $0.30 per BlackBerry share, provided, however, that no such fee shall be payable if the consortium shall have reduced the price offered below U.S. $9.00 per share without the approval of the board of directors of BlackBerry."
Ahh, thanks guys for clarifying that
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I wouldn't be worrying about Mike or anyone else having to overcome an additional $0.30 fee.....
I don't think Mike is planning to outbid Fairfax. He is just putting himself in a position to know what is going on and will be able to react quickly if the value (or an offer) falls to a point where he can't afford not to do something. The high today for BBRY was $8.30... would have been hard to turn that down if I were tied to BBRY.
IMO the conditions of their original offer should be null and void
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Show me the money Mike...if you think BlackBerry is worth what you really think it's worth (above $9 I'm sure) then show me the money and make a bid!
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Most rich people who have earn every dollar they have made.... like to hold onto those dollars. This isn't WalMart where you pay the price on the sticker. Mike's view on what BlackBerry is worth and what he will be willing to pay for it are not the same figures.
Mike isn't competing against Fairfax, he's trying to come up with a plan "D" when the Fairfax offer of $9 per share falls through.
The off by fairfax is not changing. PERIOD
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