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Hi, Please read My Assignment and help Me
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Mehrdad Kianian
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kianian
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Hi, Please read My Assignment and help Me - January 6th, 2009

Hi, Please read My Assignment and help me to answer 5 questions.
thank you

Assignment : -----------------------------------------------------

Assignment (Case Study)- (November, 2008)

Maple Leaf Gardens Shenanigans

Harold Ballard was a larger than life personality, and he packed almost enough living into his lifetime to satisfy two ordinary people. He had run the Toronto Maple Leafs, a National Hockey League (NHL) team, as his private toy and strong supporters and powerful detractors.
As he approached the end of his life, he decided that he would have his estate make some modest payments with the residual being left to seven named charities. He appointed three executors whose acumen he respected to oversee his estate: Steve Stavro, a self-made millionaire grocer; Don Giffen, the head of a group of metal companies; and Don Crump, the long-time treasurer of Maple Leaf Gardens. These executors were authorized to sell or buy property at “fair market value, supported by two independent appraisals, without court authorization.” Dob Giffen subsequently died and was replaced by a lawyer Terry Kelly.
On April 11, 1990, Harold Ballard died in a Miami Hospital. He left three children, to whom he had transferred the shares of Maple Leaf Gardens (MLG) Ltd (MLG owned the Toronto Maple Leaf Garden) many years before as part of an estate freeze arrangement. Each child had 25 percent of the MLG, but two of the three had subsequently sold their shares back to Harold. In order to complete these repurchases, Harold had borrowed $20 million from the Molson Company Limited, the owner of the Montreal Canadians NHL hockey team, even though the NHL forbade dealings between teams and their owners. One of his children, Bill, did no sell his shares back to Harold.

When the $20 million loan to Molson Company came due on December 31, 1990, attempts to repay the loan were unsuccessful and 19.99 percent of the MLG shares pledged as collateral were lost to the Molson Company. In January 1991, Stavro offered to loan the estate money in return for the exclusive right to buy the estate’s MLG shares that represented 60 percent of the company, Bill Ballard challenged Stavro’s right to do so but, in April 1990, the Ontario Court of Justice decided to allow arrangement to proceed. In September, the Molson Company agreed to sell its 19.99 percent of MLG stock to Stavro, and on September 20 Stavro also bought Bill Ballard’s 25 percent of MLG for $21 million.

In 1990, a special report was commissioned by MLG management in which Ralph Mellanby, a TV expert, was asked to render a report on future prospects for TV revenue. In it, he speculated that broadcasting rights would triple in value, making them worth 17 percent of revenue. Unfortunately, this report was not given to independent brokerage firms, which were asked to value the MLG shares in October 1993. Their valuations ranged from $25.83 to 29.92 per share by Burns Fry to $27 to $34 per share by Dominion Securities.

Negotiations commenced with the trustees for Stavro to buy the estate’s shares. Stavro found willing partners and created MLG Ventures LTD, in March 1994 to buy the Molson and those of the estate. On April 2, MLG Venture bought these shares for $34 each, which gave it 80 per cent of MLG. Ontario Teacher’s Pension Plan Board ended up owing 49 percent of MLG Ventures, with Stavro ( 41 percent) and Toronto Dominian Bank (10 percent) owning the rest. It does appear according to a handwritten note later found in the papers of the Toronto Dominian Bank, that Stavro shared information on future TV revenues, which was shared with the Bank. On April 8, MLG Venture offered $34 per share for the rest of the shares owned by the public , and 11.2 percent were tendered. MLG Ventures then owned 91.2 percent of MLG. There was a strong public reaction to keeping the bidding process private, rather than opening it up to other bidders. A former Premier of the Province of Ontario filed an affidavit with Ontario’s Public Trustee, stating that his syndicate would have offered more than $34 pershare. Based on these concerns and those for the interests of the seven charities that he was sworn to protect, the Public Trustee stepped in and asked for information on April 28 1994. He subsequently sued Stavro and others for conflict of interest (August 4, 1995) asking for information (through Ontario Court of Appeal on November 23, 1995) including the records of the Toronto Dominion Bank and commissioning a third appraisal of the MLG shares. This appraisal, which included information on new TV revenues, valued MLG shares from $50 to $53 each. After negotiation, a settlement was reached and on April 4, 1996 approved by the court, whereby the charities and others received the equivalent of $49.50 per share.On February 22, 1996 Bill Ballard filed a $50 million lawsuit, claiming he had been conned into accepting too low a price for his shares. This lawsuit is still outstanding. In addition, the Ontario Securities Commission (OSC) took notice that prominent sports figures Harry Ornest and Jim Devellano (general manager of the Detroit Red Wings), wh0 in aggregate owned about 5 percent of MLG, joined the public trustee’s lawsuit on November 2, 1995. In the fall of 1996, the OSC began to review the transactions between Stavro and his partners to determine if insider trading rules had been violated because insufficient information had been given to outsiders. The role of the Toronto Bank as both lender and owner was also under review.

Required:
1. What conflicts of interest can you identify and explain?
2. How could these have been avoided?
3. Why didn’t Harold Ballard’s executors properly discharge their fiduciary duties?
4. What steps should have been taken to ensure that the executors did their job properly?
5. Did Steve Stavro violate insider trading rules, even involuntarily?
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Rose Marry
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Re: Hi, Please read My Assignment and help Me - April 8th, 2016

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Originally Posted by kianian View Post
Hi, Please read My Assignment and help me to answer 5 questions.
thank you

Assignment : -----------------------------------------------------

Assignment (Case Study)- (November, 2008)

Maple Leaf Gardens Shenanigans

Harold Ballard was a larger than life personality, and he packed almost enough living into his lifetime to satisfy two ordinary people. He had run the Toronto Maple Leafs, a National Hockey League (NHL) team, as his private toy and strong supporters and powerful detractors.
As he approached the end of his life, he decided that he would have his estate make some modest payments with the residual being left to seven named charities. He appointed three executors whose acumen he respected to oversee his estate: Steve Stavro, a self-made millionaire grocer; Don Giffen, the head of a group of metal companies; and Don Crump, the long-time treasurer of Maple Leaf Gardens. These executors were authorized to sell or buy property at “fair market value, supported by two independent appraisals, without court authorization.” Dob Giffen subsequently died and was replaced by a lawyer Terry Kelly.
On April 11, 1990, Harold Ballard died in a Miami Hospital. He left three children, to whom he had transferred the shares of Maple Leaf Gardens (MLG) Ltd (MLG owned the Toronto Maple Leaf Garden) many years before as part of an estate freeze arrangement. Each child had 25 percent of the MLG, but two of the three had subsequently sold their shares back to Harold. In order to complete these repurchases, Harold had borrowed $20 million from the Molson Company Limited, the owner of the Montreal Canadians NHL hockey team, even though the NHL forbade dealings between teams and their owners. One of his children, Bill, did no sell his shares back to Harold.

When the $20 million loan to Molson Company came due on December 31, 1990, attempts to repay the loan were unsuccessful and 19.99 percent of the MLG shares pledged as collateral were lost to the Molson Company. In January 1991, Stavro offered to loan the estate money in return for the exclusive right to buy the estate’s MLG shares that represented 60 percent of the company, Bill Ballard challenged Stavro’s right to do so but, in April 1990, the Ontario Court of Justice decided to allow arrangement to proceed. In September, the Molson Company agreed to sell its 19.99 percent of MLG stock to Stavro, and on September 20 Stavro also bought Bill Ballard’s 25 percent of MLG for $21 million.

In 1990, a special report was commissioned by MLG management in which Ralph Mellanby, a TV expert, was asked to render a report on future prospects for TV revenue. In it, he speculated that broadcasting rights would triple in value, making them worth 17 percent of revenue. Unfortunately, this report was not given to independent brokerage firms, which were asked to value the MLG shares in October 1993. Their valuations ranged from $25.83 to 29.92 per share by Burns Fry to $27 to $34 per share by Dominion Securities.

Negotiations commenced with the trustees for Stavro to buy the estate’s shares. Stavro found willing partners and created MLG Ventures LTD, in March 1994 to buy the Molson and those of the estate. On April 2, MLG Venture bought these shares for $34 each, which gave it 80 per cent of MLG. Ontario Teacher’s Pension Plan Board ended up owing 49 percent of MLG Ventures, with Stavro ( 41 percent) and Toronto Dominian Bank (10 percent) owning the rest. It does appear according to a handwritten note later found in the papers of the Toronto Dominian Bank, that Stavro shared information on future TV revenues, which was shared with the Bank. On April 8, MLG Venture offered $34 per share for the rest of the shares owned by the public , and 11.2 percent were tendered. MLG Ventures then owned 91.2 percent of MLG. There was a strong public reaction to keeping the bidding process private, rather than opening it up to other bidders. A former Premier of the Province of Ontario filed an affidavit with Ontario’s Public Trustee, stating that his syndicate would have offered more than $34 pershare. Based on these concerns and those for the interests of the seven charities that he was sworn to protect, the Public Trustee stepped in and asked for information on April 28 1994. He subsequently sued Stavro and others for conflict of interest (August 4, 1995) asking for information (through Ontario Court of Appeal on November 23, 1995) including the records of the Toronto Dominion Bank and commissioning a third appraisal of the MLG shares. This appraisal, which included information on new TV revenues, valued MLG shares from $50 to $53 each. After negotiation, a settlement was reached and on April 4, 1996 approved by the court, whereby the charities and others received the equivalent of $49.50 per share.On February 22, 1996 Bill Ballard filed a $50 million lawsuit, claiming he had been conned into accepting too low a price for his shares. This lawsuit is still outstanding. In addition, the Ontario Securities Commission (OSC) took notice that prominent sports figures Harry Ornest and Jim Devellano (general manager of the Detroit Red Wings), wh0 in aggregate owned about 5 percent of MLG, joined the public trustee’s lawsuit on November 2, 1995. In the fall of 1996, the OSC began to review the transactions between Stavro and his partners to determine if insider trading rules had been violated because insufficient information had been given to outsiders. The role of the Toronto Bank as both lender and owner was also under review.

Required:
1. What conflicts of interest can you identify and explain?
2. How could these have been avoided?
3. Why didn’t Harold Ballard’s executors properly discharge their fiduciary duties?
4. What steps should have been taken to ensure that the executors did their job properly?
5. Did Steve Stavro violate insider trading rules, even involuntarily?
Hey buddy,

Here i am up-loading Protocol on conflicts of interest, please check attachment below.
Attached Files
File Type: pdf Protocol on conflicts of interest.pdf (48.5 KB, 0 views)
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