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  5. HPS.A: With respect to a potential take-over in a family run company, does his have a coattail provision. [Hammond Power Solutions Inc. Class A Subordinate Voting Shares]
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Q: With respect to a potential take-over in a family run company, does his have a coattail provision.

Thanks
Asked by Leon on January 09, 2024
5i Research Answer:

Essentially yes. While not technically a 'coattail' provision, in the event of a change of control the Class A shares convert to Class B shares, which results in the same thing at the end of the day and Class A shares get to participate in a takeover. From filings: The Class A Subordinate Voting Shares will be deemed to have converted into Class B Common Shares on a one for one basis in the event of a change of control. A change of control is deemed to have occurred if neither the “W.G. Hammond Family” or an “Acceptable Successor”, as such terms are defined in the Corporation’s Articles of Incorporation, continues to beneficially own, directly or indirectly, such number of shares of the Corporation to which are attached in the aggregate not less than 50% of the votes attaching to all issued and outstanding shares of the Corporation.