Lexpert Magazine

Jan/Feb 2017

Lexpert magazine features articles and columns on developments in legal practice management, deals and lawsuits of interest in Canada, the law and business issues of interest to legal professionals and businesses that purchase legal services.

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18 LEXPERT MAGAZINE | JANUARY/FEBRUARY 2017 BIG DEALS DEALS ANALYSIS 18 18 Total Deals Published 6 Corporate Finance 21 12 Mergers & Acquisitions 21 7 Cross-border Transactions 21 BIG DEALS TRANSACTION VITALS ANNOUNCED: 10/7/2016 CLOSED: 10/7/2016 TECHNIQUE: PRIVATELY NEGOTIATED PURCHASE ATTITUDE: FRIENDLY US ACQUIRER SOUGHT: UNDISCLOSED MINORITY STAKE JOHN LEOPOLD STIKEMAN ELLIOTT LLP TORONTO (FOR OAKTREE IN CANADA) PATRICIA OLASKER DAVIES WARD PHILLIPS & VINEBERG LLP TORONTO (FOR SUNOPTA) On October 7, 2016, SunOpta Incorporated, a global organice foods company listed on the Nasdaq and Toronto Stock Exchange, complet- ed a cross-border private investment in public equity (PIPE) transac- tion involving a private placement of US$85 million in exchangeable preferred shares (Shares) to private equity funds managed by Oaktree Capital Management, Limited Partnership. SunOpta Inc. completed the transaction with the support of shareholders Tourbillon Capital Partners and Engaged Capi- tal following a review of stra- tegic alternatives conducted by SunOpta's board of direc- tors (Board). e transaction involved the issuance of preferred shares by a subsidiary in the United States. ese shares are struc- tured so as to be exchangeable into common shares of the parent public company. rough a voting trust arrangement, as long as the preferred shares are held by affiliates of Oaktree, the holders of the preferred shares have the right to vote on an as-exchanged basis with common shareholders. Oaktree obtained governance rights in the public company and the right to nominate two new Board members. SunOpta has an- nounced, in addition, the appointment of a representative of Engaged Capital, SunOpta's second largest shareholder, to the Board. e net proceeds from the Shares were used to repay a portion of the principal owing under one of SunOpta's credit agreements. e transaction represents a novel use of a cross-border exchange- able preferred share structure by a Canadian company. is structure allows a Canadian company to effectively issue a form of equity se- curity comparable to the type of voting, convertible preferred stock common in the United States private equity and private investment in public equity (PIPE) market in a manner that respects Canadian tax and regulatory constraints that have historically made such trans- actions unachievable in Canada. Kirkland & Ellis LLP acted as counsel to Oaktree Capital Management with a team including Hamed Meshki, Dennis My- ers, Wayne Williams, Craig Garvey, Kevin Behseresht, Alexander Schwartz and Dilveer Singh Vahali (corporate/capital markets), Dave Nemecek and Nisha Kanchanapoomi (debt finance) and Russell Light and Brett Willis (tax). Stikeman Elliott LLP acted as Canadian counsel to Oaktree with a team including John Leopold, Simon Romano, David Massé, Jer- emy Sculnick, Jordan Altman and Michael Ball (corporate/capital markets), Jeffrey Brown and Ryan Sheahan (competition/regulatory) and Frank Mathieu and Philippe Kattan (tax). Davies Ward Phillips & Vineberg LLP represented SunOpta In- corporated, with a team that included Patricia Olasker, Alex Moore, Mindy Gilbert, Steven Harris, Geoff Rawle, Jared Solinger and Jona- than Bilyk (mergers and acquisitions/corporate), Raj Juneja and Peter Glicklich (taxation). Stoel Rives LLP provided legal advice to SunOpta Incorporated on matters pertaining to United States corporate and securities law, with a team that included Reed Topham, James Kearney and Sara Benzion. Rothschild Financial Advi- sory acted as financial adviser to the Special Committee of the Board of SunOpta. COMPILED BY GENA SMITH E-Commerce Construction & Engineering Consumer Staples SUNOPTA FORMS STRATEGIC PARTNERSHIP WITH OAKTREE

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