POLAND Law and Practice Contributed by: Agnieszka Janicka, Krzysztof Hajdamowicz and Jarosław Lorenc, Clifford Chance LLP
shares for the minority shareholders. The length of the squeeze-out period is therefore only driven by the technical needs of these entities. A squeeze-out pro - cedure is usually not open for more than four or five business days, as this period should be sufficient for the National Depository for Securities and the brokers holding shares for the minority shareholders to com - municate and take the necessary actions to carry out the squeeze-out. Squeeze-outs are subject to minimum pricing rules similar to those applicable to tender offers. 6.11 Irrevocable Commitments An alternative to stakebuilding is for a bidder to obtain irrevocable undertakings or letters of intent to accept its tender offer once it is made from certain key share - holders. These are not regulated in Poland and are rather popular in organised processes initiated by the shareholders or when there are major shareholders, such as the founders of the company. There are examples where certain major shareholders (eg, aligned with the management) have given under - takings to accept a specific tender offer and not any competing offer. These undertakings are not prohib - ited. However, some Polish institutional investors are reluc - tant to give any firm commitment to accept a tender offer. It is therefore difficult to obtain this type of pro - tection from financial investors and market practice in this respect is not very well developed. A tender offer has to be announced and carried out through an entity authorised to conduct brokerage activity in Poland. This intermediation is mandatory and there are steps that only an appointed broker can take for the bidder. A tender offer may only be initiated after security has been created for no less than 100% of the value of the shares subject to the tender offer. This has to be documented by a certificate issued by the bank or 7. Disclosure 7.1 Making a Bid Public
other financial institution that granted the security or acted as an intermediary in the granting of the secu - rity. It must be hard security, and the admissible forms thereof are specified under Polish law. As in the case of a squeeze-out, there are two phases in the tender offer process: limited public disclosure and fully open to the public. The first phase is started when the broker acting on behalf of the bidder notifies the PFSA/KNF of its inten - tion to announce a tender offer, attaching a draft of the full tender offer document and proof of the estab - lishment of security to the notification, which will be made 17 business days prior to the planned launch of the tender offer. After submitting the notification, the broker should immediately submit the information regarding the intention to announce the tender offer including, among other things, the name of the target company, the identity of the bidder and the proposed price to the press agencies, for the purpose of publication. This is the only information provided to the general public at this stage (the full tender offer document is therefore not yet disclosed). The second stage starts after the lapse of 17 business days after the notification to the PFSA/KNF, when the broker communicates the contents of the tender offer document to at least one press agency for the purpose of its announcement. The press agency disseminates the tender offer information to the public and from this moment the tender offer is announced and the full tender offer document is available to the public. Once properly announced, a tender offer cannot be abandoned unless another entity announces a tender offer for all the outstanding shares of the same target company, provided that the price offered for them is higher than in the first tender offer and there are no conditions in the subsequent tender offer (ie, it is either a mandatory tender offer, a delisting tender offer or a voluntary tender offer without a single condition stipulated therein).
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