Formal Take-over Bid, An offer made to the security holders of a company to purchase the
How is the 20% accounted for? (3) voting securities of a company which, with the offeror's already-owned
securities, will in total exceed 20% of the outstanding voting securities
of the company.
That calculation 20% summation of:
voting shares already owned,
equity securities already owned,
unissued shares that could be obtained through options, warrants, or
convertible securities.
record date and ex-dividend date Buy before ex-dividend date → you get dividend.
Buy on or after ex-dividend date (including record date) → no
dividend. ( T+ 1) day to settle, by the time stocks settle, its already
trading ex dividend
Record Date: The company looks at its books to see who officially
owns the stock to get the dividend.
Ex-dividend rule
Buyers need to have their order price lowered because they’re missing
the dividend.
Sellers don’t need their orders lowered because the stock’s market
price already dropped to reflect the dividend.
,Requirements for successful take over bid and 1) the buyer must get more than 50% of the shares deposited before
when can shareholders withdraw proceeding. (More than half of shareholders must agree to sell before
the buyer is allowed to go ahead with the takeover)
2) The bid must stay open at least 35 days, and the buyer cannot take
any shares before that time.
When can shareholders withdraw?
1) at any time before the bid expires,
2) after 45 days if nothing has happened,
3) if the buyer takes shares but doesn't pay within three days,
or within 10 days if the bid terms change.
If shares are withdrawn, the buyer must return them.
SIN number - why does RR need it For tax purposes- if client unwilling to disclose it, consult with branch
supervisor
PCMLTFA Proceeds of Crime ( Money laundering) Act that Forces certain businesses (like investment dealers and banks)
and Terrorist financing Act & Who regulates it? to help detect and prevent money laundering and terrorist financing.
REGULATED BY FEDERAL GOVERNMENT
Act says: “You must identify clients and report suspicious activity.”
Dealer/Bank complies and files reports
FINTRAC receives and analyzes the data ( Federal Gov)
Law enforcement investigates if needed
,PCMLTFA verification with clients Banking info can be used to verify person's ID under PCMLTFA, credit
department may also check banking information if there is a concern
about new client being a credit risk
Unified Value System A value system in which end values and means values mutually
reinforce and support each other.
End may be good- but "bad" means disrupts unified value system. e.g.
mean= honesty. fairness
hell is paved with good intentions
Grey list An internal, restricted list of companies where the dealer has
confidential (non-public) information, and trading is monitored closely
to detect possible misuse or leaks of that information.
Strip bonds- when does RR need to disclose? When client initially places order ( first time buyers)
needs to disclose:
- price volatility
- income tax impact
- secondary market liquidity
- custodial arrangements
, Leverage Disclosure needed? Yes for the first time, however after that the rules differ:
Is leverage disclosure required each time borrowed funds are used?
No. CIRO does not require leverage disclosure each time borrowed
funds are used.
Are margin account purchases exempt from leverage disclosure?
yes, margin account purchases are specifically exempt unless a
triggering event occurs or the disclosure is older than six months.
Additional Disclosures - Real or perceived conflict of interest
- Firm is in a relationship as a introducing broker with a carrying broker
(Introducing broker = front office
Carrying broker = back office & vault * holding clients assets)
- Share premise with financial service entity- insurance as an example
- RR is an agent rather than employee
- Referral arrangements
Mom Test, Legal Test and Front page test Legal: To assess if its illegal or against industry rules
Front page: Would it cause reputational harm to advisor and dealer if
behaviour in this situation became public knowledge
Mom Test: how comfortable one would be if they had to reveal their
decision to their mom
How is the 20% accounted for? (3) voting securities of a company which, with the offeror's already-owned
securities, will in total exceed 20% of the outstanding voting securities
of the company.
That calculation 20% summation of:
voting shares already owned,
equity securities already owned,
unissued shares that could be obtained through options, warrants, or
convertible securities.
record date and ex-dividend date Buy before ex-dividend date → you get dividend.
Buy on or after ex-dividend date (including record date) → no
dividend. ( T+ 1) day to settle, by the time stocks settle, its already
trading ex dividend
Record Date: The company looks at its books to see who officially
owns the stock to get the dividend.
Ex-dividend rule
Buyers need to have their order price lowered because they’re missing
the dividend.
Sellers don’t need their orders lowered because the stock’s market
price already dropped to reflect the dividend.
,Requirements for successful take over bid and 1) the buyer must get more than 50% of the shares deposited before
when can shareholders withdraw proceeding. (More than half of shareholders must agree to sell before
the buyer is allowed to go ahead with the takeover)
2) The bid must stay open at least 35 days, and the buyer cannot take
any shares before that time.
When can shareholders withdraw?
1) at any time before the bid expires,
2) after 45 days if nothing has happened,
3) if the buyer takes shares but doesn't pay within three days,
or within 10 days if the bid terms change.
If shares are withdrawn, the buyer must return them.
SIN number - why does RR need it For tax purposes- if client unwilling to disclose it, consult with branch
supervisor
PCMLTFA Proceeds of Crime ( Money laundering) Act that Forces certain businesses (like investment dealers and banks)
and Terrorist financing Act & Who regulates it? to help detect and prevent money laundering and terrorist financing.
REGULATED BY FEDERAL GOVERNMENT
Act says: “You must identify clients and report suspicious activity.”
Dealer/Bank complies and files reports
FINTRAC receives and analyzes the data ( Federal Gov)
Law enforcement investigates if needed
,PCMLTFA verification with clients Banking info can be used to verify person's ID under PCMLTFA, credit
department may also check banking information if there is a concern
about new client being a credit risk
Unified Value System A value system in which end values and means values mutually
reinforce and support each other.
End may be good- but "bad" means disrupts unified value system. e.g.
mean= honesty. fairness
hell is paved with good intentions
Grey list An internal, restricted list of companies where the dealer has
confidential (non-public) information, and trading is monitored closely
to detect possible misuse or leaks of that information.
Strip bonds- when does RR need to disclose? When client initially places order ( first time buyers)
needs to disclose:
- price volatility
- income tax impact
- secondary market liquidity
- custodial arrangements
, Leverage Disclosure needed? Yes for the first time, however after that the rules differ:
Is leverage disclosure required each time borrowed funds are used?
No. CIRO does not require leverage disclosure each time borrowed
funds are used.
Are margin account purchases exempt from leverage disclosure?
yes, margin account purchases are specifically exempt unless a
triggering event occurs or the disclosure is older than six months.
Additional Disclosures - Real or perceived conflict of interest
- Firm is in a relationship as a introducing broker with a carrying broker
(Introducing broker = front office
Carrying broker = back office & vault * holding clients assets)
- Share premise with financial service entity- insurance as an example
- RR is an agent rather than employee
- Referral arrangements
Mom Test, Legal Test and Front page test Legal: To assess if its illegal or against industry rules
Front page: Would it cause reputational harm to advisor and dealer if
behaviour in this situation became public knowledge
Mom Test: how comfortable one would be if they had to reveal their
decision to their mom
