December 23, 2019
Via E-mail
Richard C. Witzel, Jr., Esq.
Skadden, Arps, Slate, Meagher & Flom LLP
155 North Wacker Drive
Chicago, IL 60606
Re: Wright Medical Group N.V.
Schedule TO-T
Filed December 13, 2019
File No. 005-86024
Dear Mr. Witzel:
The staff in the Office of Mergers and Acquisitions has reviewed the
filing listed above,
and we have the comments set forth below. All defined terms used herein have
the same
meaning as in Offer to Purchase for Cash attached as Exhibit (a)(1)(A) to the
Schedule TO-T. In
some of our comments, we may ask you to provide us with information so we may
better
understand your disclosure.
Please respond to this letter by amending your filing, by providing the
requested
information, or by advising us when you will provide the requested response. If
you do not
believe our comments apply to your facts and circumstances or do not believe an
amendment is
appropriate, please tell us why in your response.
After reviewing any amendment to your filing and the information you
provide in
response to these comments, we may have additional comments.
Exhibit (a)(1)(A)
Cover Page
1. While Purchaser may amend the minimum condition at any time during the
initial offering
period, changing it requires that Purchaser amend the offer materials,
disseminate
information about the change, and ensure that sufficient time remains in the
initial offering
period for Wright shareholders to receive and react to the new information.
Additionally,
Purchaser may be required to disseminate revised disclosure explaining the
effect of any
change to the ownership percentage that Purchaser and Stryker may own after
the offer. For
example, in certain non-U.S. jurisdictions, where a bidder cannot eliminate
remaining target
shareholders simply by acquiring a majority of the target's shares, lowering
the minimum
condition may require an explanation of the effect on a bidder's ability to
integrate the target
Richard C. Witzel, Jr., Esq.
Skadden, Arps, Slate, Meagher & Flom LLP
December 23, 2019
Page 2
company after the offer. Please revise the disclosure to affirm that
Purchaser will provide
shareholders with additional disclosure after any change in the minimum
condition and
ensure that the offer remains open for an adequate time to allow
shareholders to react to that
new disclosure.
2. Explain the phrase "subsequent EGM" and clarify the circumstances pursuant
to which
Wright may hold such a meeting. Discuss any impact a subsequent EGM would
have on
Purchaser providing a subsequent offering period.
3. The Purchase Agreement provides that Purchaser will accept all shares
validly tendered for
payment within two business days following the Expiration Time, and will pay
for the shares
within two business days following the Acceptance Time. Provide us with your
analysis as
to how this complies with the prompt payment requirement in Rule 14e-1(c).
Acceptance for Payment and Payment for Shares, page 9
4. You state that determinations by Purchaser as to questions of validity,
form, eligibility, and
acceptance for payment of any tenders will be "final and binding" upon the
tendering party.
Please revise to clarify that tendering shareholders may challenge
Purchaser's determinations
in a court of competent jurisdiction.
Source and Amount of Funds, page 22
5. Specify the portion of funds that are expected to come from bank or other
debt financings.
Disclose the parties to the arrangements, the applicable interest rates, and
any other material
terms of the arrangements. Refer to Item 1007(d) of Regulation M-A.
Termination of the Purchase Agreement, page 43
6. The disclosure in this section indicates that under certain circumstances,
the Purchase
Agreement may be terminated following the expiration date but prior to
acceptance. In your
response letter, please advise us as to the parties' understanding regarding
Purchaser's
obligation to consummate the offer following termination of the Purchase
Agreement
assuming all offer conditions have been satisfied or waived.
The Purchase Agreement; Other Agreements
Governing Law, Jurisdiction, page 45
7. In your response letter, tell us whether this choice of forum provision is
intended to apply to
or limit claims brought by Wright shareholders, and if so, provide the basis
for that assertion.
To the extent you intend for this choice of forum provision to apply to
shareholders, clarify
whether the provision applies to claims brought under the Securities Act or
Exchange Act.
Richard C. Witzel, Jr., Esq.
Skadden, Arps, Slate, Meagher & Flom LLP
December 23, 2019
Page 3
Purpose of the Offer; Plans for Wright, page 45
8. Your disclosure indicates that if the Governance Resolutions are approved,
record ownership
of shares can only be transferred pursuant to a notarial deed executed
before a Dutch notary,
which will include various administrative formalities and require
shareholders to incur costs
for Dutch notarial fees upon transfer. Please advise us as to whether,
pursuant to the
proposed amendment of Wright's articles of association at the EGM, these
transfer
restrictions could take effect during the pendency of the tender offer or
subsequent offer
period. To the extent that is the case, tell us how this process complies
with the prompt
payment requirement in Rule 14e-1(c) and the best-price requirement in Rule
14d-10. You
should also disclose how long the process is expected to take and quantify
the costs to
shareholders.
Post-Offer Reorganization, page 46
9. In your response letter, please provide us with an analysis as to whether
Exchange Act Rule
13e-3 will apply to any second-step squeeze out transaction following
consummation of the
offer.
Certain Conditions of the Offer, page 51
10. Refer to the condition set forth in the last bullet point on page 52: " the
Purchase Agreement
has not been terminated pursuant to its terms." To the extent a bidder
reserves the right to
assert an offer condition based upon its own action or inaction, the tender
offer could be
viewed as illusory and thus in contravention of Section 14(e). Please
revise to make clear
that all Offer conditions must be outside the control of the bidder.
11. Please clarify whether the aforementioned condition is solely for the
benefit of Stryker and
Purchaser, as your disclosure in the last paragraph of page 52 appears to
conflict with the
first full paragraph on page 53 in that respect. Also clarify whether the
condition is subject to
waiver by Stryker or Purchaser.
12. Your disclosure indicates that Purchaser will not be deemed to have waived
its rights relating
to the satisfaction or waiver of the conditions to the extent Purchaser
fails to exercise such
rights at a given time. This suggests that Purchaser may become aware that
an offer
condition has been triggered yet the tender offer may proceed without new
disclosure. To the
extent Purchaser becomes aware of any offer condition becoming operative in
a way that
would enable Purchaser to terminate the offer or cancel the obligation to
accept tenders, and
Purchaser elects to proceed with the offer anyway, we view that decision as
being a waiver of
the condition. If a material condition is waived, a material change has
occurred to the offer
document within the meaning of Rule 14d-6(c). Please revise this section to
qualify the
referenced disclosure by affirming Purchaser's understanding of its
obligation to disclose
material changes.
Richard C. Witzel, Jr., Esq.
Skadden, Arps, Slate, Meagher & Flom LLP
December 23, 2019
Page 4
Miscellaneous, page 55
13. Refer to the statement, "The Offer is not being made to (nor will tenders
be accepted from or
on behalf of) Wright shareholders in any jurisdiction in which the making
of the Offer or the
acceptance thereof would not be in compliance with the securities, blue sky
or other laws of
such jurisdiction." While you are not required to distribute the offer
materials into any
foreign jurisdiction, tenders must be accepted from all target security
holders, wherever
located. See Rule 14d-10 and guidance in Release No. 33-8957 (September 19,
2008).
Please revise your disclosure here accordingly.
* * *
We remind you that the registrant and its management are responsible
for the accuracy
and adequacy of their disclosures, notwithstanding any review, comments, action
or absence of
action by the staff.
Please direct any questions to me at (202) 551-7951. You may also
contact Tina Chalk,
Senior Special Counsel, at (202) 551-3263.
Sincerely,
/s/ Joshua Shainess
Joshua Shainess
Special Counsel
Office of Mergers
and Acquisitions