Since Mr. Harris didn't answer my email I guess I'll pose this to the board. I'm not bashing, just trying to understand and make a good decision. Please give me your thoughts on what you think may be happening. Evidently the market is not buying the fact FHAL shareholders are just going to be handed a $15 stock someday soon. Anyway:
I've had a chance to go over the filings better and even if FHAL does NOT do a reverse split it looks as though the provisions in the agreement are mostly pertaining to CSVU or in other words, the "Company" according to the merger agreement. It seems as though it's the "company" NOT the "buyer" (FHAL) who benefits and may possibly get the $15 per share. There are 48,898637 OUTSTANDING CSVU shares...ummmm that's over $720 million if my math is right. Where's this money coming from? Now factor in the FHAL shareholders who think they are going to get a piece of this pie too and there are 62,157,721 of them from what I could find. That's over $900 million. HUH???? Over a billion and a half going to shareholders for this merger? LMAO ok we all need to put down the crackpipes OR to make this believable maybe we need to fire 'em up. LOL
So the way I see it it will then be in the best interest of the "buyer" to excercise the clause in section 2.6 (a) maintain the Average Closing Price at a price equal to the Actual Average Closing Price;
So in actuality if they did this then the current shareholders of FHAL may not be real happy since the PPS was significantly lower in the past 20 days. Averaging that PPS may be brutal to some. But the bottom line is I see NOTHING that promises $15 to current FHAL shareholders. This is my opinion only and I am not bashing, just hoping someone can shed better light on this. And below are the snippets from the filings that concern me:
c) In the event the Buyer changes the number of shares of the Buyer's Stock issued and outstanding prior to the Effective Time as a result of a stock split, stock dividend or other distribution payable in Buyer's Stock or securities convertible into Buyer's Stock or similar recapitalization with respect to such stock or effects a reclassification, combination or other change with respect to Buyer's Stock (each a "Stock Adjustment" ) and the record date therefore (in the case of a stock dividend) or the effective date thereof (in the case of a stock split or similar recapitalization, reclassification or combination for which a record date is not established) shall be prior to the Effective Time
Observation: Leaves the option of a Reverse Split open.
2.6 AVERAGE CLOSING PRICE ADJUSTMENT.
In the event that the Actual Average Closing Price is less than $15.00, the Surviving Holdings Company shall deliver written notice to the Company no later than the second (2 nd ) Business Day preceding the Closing Date pursuant to which the Surviving Holdings Company shall elect, in its sole discretion, to: (a) maintain the Average Closing Price at a price equal to the Actual Average Closing Price; (b) set the Average Closing Price at $15.00 and pay the holders of Company Shares receiving shares of Buyer's Stock as Merger Consideration (after giving effect to the allocation procedures set forth in Section 2.4 ) an amount in cash equal to $15.00 minus the Actual Average Closing Price per share of Buyer's Stock to be received by such holders of Company Shares; or (c) set the Average Closing Price at $15.00 and pay no additional consideration to the holders of Company Shares receiving shares of Buyer's Stock as Merger Consideration (after giving effect to the allocation procedures set forth in Section 2.4 ). In the event that the Buyer elects option (c) described above, the Company may terminate this Agreement by providing the Buyer written notice of termination no later than one (1) Business Day prior to the Closing Date.
Observation: Ok it speaks to the affects of this merger as it pertains to the "Company shareholders" but how about the "buyer's shareholders?" (FHAL) And as I said earlier why would FHAL NOT excercise section (A). If they pay $15 per share to just the "company" shareholders of which according to the filings is 48,898,637 that amounts to over $720 million. WHERE is this coming from? It mentions absolutely NOTHING about paying FHAL shareholders who surrender their shares, $15. It doesn't mention FHAL "buyers" ANYWHERE does it? Am I missing something here?
2. Surviving Corporation.
(a) Each outstanding share of the Buyer's Stock shall remain outstanding after the Effective Time and shall not be affected by the Merger.
(b) in the event FHAL changes the number of shares of its common stock issued and outstanding prior to the Effective Time as a result of a stock split, stock dividend or similar reorganization with respect to such stock and the record date thereof (in the case of a stock dividend) or the effective date thereof (in the case of a stock split or similar recapitalization for which a record date is not established) shall be prior to such Effective Time, the consideration to be exchanged for the Company Shares shall be equitably adjusted to reflect such change.
Observation: Read (A) very closely. THAT is where the "buyer" is revealed in all of this. NOT AFFECTED!
Please don't think I'm bashing because I'm not. This is merely up for discussion. And if I am off base please explain because I think a lot of people are confused. To me it is much clearer now unless someone could shed better light on this.
AI
