DENMARK Law and Practice Contributed by: Morten Jensen, Elise Ross-Hansen, Frederik André Bork and Paula Grønlund, Bruun & Hjejle
6.5 Minimum Acceptance Conditions If a bidder in a voluntary offer acquires between one third and 50% of the target, the bidder is required to complete a mandatory offer following the voluntary offer. Consequently, an acceptance threshold above 50% will usually be included as a condition in a voluntary offer. It is very common for the minimum acceptance condition to be set at more than 90% of the shares and voting rights, as this is the thresh - old for effecting a redemption of the remaining minority shareholders under the Danish Com - panies Act. Similarly, a company may be del - isted if a shareholder secures more than 90% of the share capital, allowing them to compulsorily redeem the remaining shares under applicable company law. Alternatively, delisting can occur if a resolution is passed at a general meeting with at least 90% of the votes cast and at least 90% of the share capital represented. Other relevant thresholds are two thirds of the shares and voting rights, or just above 50%. A total of two thirds of the shares and voting rights is sufficient to complete most amendments of the articles of association and to effect capi - tal increases or mergers. A simple majority of shares and voting rights is sufficient to control most decisions at the general meeting, including the appointment of directors. 6.6 Requirement to Obtain Financing Neither a mandatory nor a voluntary offer may be conditional on the bidder obtaining financ - ing. Prior to the announcement of a mandatory or a voluntary offer, it must be ensured that the bidder can fully meet any requirement regarding consideration in cash. Furthermore, the bidder must also have taken all reasonable measures to ensure that any other form of consideration (eg, share consideration) can be paid.
6.7 Types of Deal Security Measures The most common deal security measure used by bidders in public M&A transactions is non- solicitation provisions and matching rights. Break-up fees are legally permissible (if reason - able) but are not commonly used in the Danish market and are often rejected by targets with reference to the board’s fiduciary duties. Material adverse change (MAC) conditions are sometimes used, and gap covenants have been tailored to protect against pandemic risk in an interim period. There have been no changes in the regulatory environment leading to changes in interim peri - ods. 6.8 Additional Governance Rights In private M&A transactions, it is common for the shareholders to enter into a shareholders’ agree - ment where additional terms can be arranged, including rights to appoint members of the board of directors and to veto rights concerning certain proposals put forward at the general meeting. It is, however, important to note that under Danish law a shareholders’ agreement is generally not binding on the company. A breach of contract must therefore be handled separately between the shareholders. In a listed company, it is uncommon for certain shareholders to be provided with additional governance rights. It is possible to build special governance rights into the articles of associa - tion, but this is rarely seen outside the context of restructurings. 6.9 Voting by Proxy Shareholders have the opportunity to vote by proxy in Denmark, and such a right cannot be restricted in a limited liability company. If a
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