MOLDOVA Law and Practice Contributed by: Oleg Efrim, Ina Jimbei and Mihail Pitușcan, Efrim Rosca & Associates
gic objective is enhanced governance control or full consolidation. 6.6 Requirement to Obtain Financing In public takeover bids, the offer may not be made conditional on the bidder obtaining financing. The bid - der must demonstrate, before the offer document is approved, that sufficient funds are available to sat - isfy the full consideration. This requirement, typically evidenced by own funds, a bank guarantee or an equivalent financial commitment, effectively excludes financing-out conditions in public offers. In private M&A transactions, financing contingencies are not prohibited by law. However, they are relatively uncommon in the Moldovan market, particularly in domestic transactions. Sellers generally expect fund - ing certainty at signing, and financing risk is typically managed internally by the buyer rather than allocated to the seller contractually. 6.7 Types of Deal Security Measures In private M&A transactions, bidders may seek cus - tomary deal protection mechanisms to preserve exclusivity and execution certainty. Non-solicitation and exclusivity undertakings are the most common tools. Break-up fees are legally permissible but are not yet standard in the Moldovan market; when used, they are typically modest in scope and subject to general contractual enforceability principles. Match rights or force-the-vote provisions are uncom - mon in domestic practice, largely due to the concen - trated ownership structure of most companies and the negotiated nature of transactions. In public takeover bids, deal protection mechanisms are more constrained. The statutory framework emphasises equal treatment of shareholders and lim - its the ability to grant preferential arrangements that could distort the offer process. As a result, contractual protections are more limited and must comply with capital markets regulations. 6.8 Additional Governance Rights Where a bidder acquires less than 100% of the tar - get, influence may derive from both statutory minority
rights and enhanced contractual governance arrange - ments. Moldovan corporate legislation grants shareholders holding specific thresholds a series of incremen - tal rights. Lower thresholds entitle shareholders to place items on the agenda of the general meeting, propose candidates to governing bodies and request the convening of meetings. Higher thresholds confer stronger oversight tools, including the right to request extraordinary audits, challenge management conduct through derivative actions and initiate the convening of extraordinary general meetings. In practice, however, strategic investors rarely rely solely on statutory minority protections. Additional governance rights are typically secured through amendments to the constitutional documents and/or shareholders’ agreements. These may include board representation, veto rights over reserved matters, enhanced information and audit rights, and exit pro - tection mechanisms. Accordingly, even without full ownership, a bidder can obtain significant influence over the governance and strategic direction of the target, either through statu - tory rights attached to specific shareholding thresh - olds or through negotiated contractual arrangements. 6.9 Voting by Proxy Shareholders may exercise their voting rights through one or more duly authorised representatives. Proxy voting is expressly recognised for both limited liability companies and joint-stock companies. A representative may act for multiple sharehold - ers, provided that the voting instructions from each appointing shareholder are respected individually. The proxy must be evidenced in writing and must clearly indicate the scope of authority granted. In practice, voting instructions are typically incorporated into the proxy instrument or a separate written mandate. The validity of the representative’s participation is veri - fied at the meeting, and the relevant documentation becomes part of the meeting records. Proxy voting is widely used, particularly in listed companies.
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