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This vehicle won't be on the lot long! You'll appreciate its safety and convenience features! Subaru prioritized comfort and style by including: a built-in garage door transmitter, power door mirrors, and cruise control. It features a standard transmission, all-wheel drive, and a 2 liter 4 cylinder engine. Our sales reps are knowledgeable and professional. We'd be happy to answer any questions that you may have. Come on in and take a test drive!
accommodating for appt date/time; provided shuttle service for dr. appt.; Roddy, as usual, is the best; Greg, shuttle driver, was great. accommodated service call with our dr. appt. - did not have to make a separate trip.
Very professional and efficient. I drove my car to the service entrance and checked in timely. I drive from the south hills if that tells you anything! Very happy with the service!
Ease of appointment time; car serviced in a timely manner; love the car wash. Everyone at dealership is great to work with. John & Roddy are the best. Would not trust my TL to anyone but Baierl Acura. New dealership is awesome and comfortable.
Passenger side door was replaced. Discovered the repaired door’s weatherproofing gasket was not installed properly. Rain and air were leaking in! Had to go back to the service department an hour away to have this fixed. There was no apology. they just made me wait. Get your car repaired elsewhere.
I continue to get my Acura serviced at this dealership because they are always timely and efficient in their work. This is my second Acura and I believe that local mechanics struggle with the maintenance of these vehicles. My second car seems to be running more efficiently for a longer period of time and I believe that is because it is now being serviced correctly.
Thank you for the review of our team! We believe our team is full of experts, so if you need anything else just stop on by. We'd be happy to help. Have a great day!
Set up appointment and was taken on time, given an estimated start and completion time, as well as cost. The car was finished sooner than expected and John Henline helped get me under the estimate. All work was done well and got a car wash, too.
Thank you so much Bruce! We're so happy to hear they did so well for you! Let them or anyone else know if you need anything!
As usual, Rod provided excellent service and advice. Rod is always very professional, while friendly and provides a great customer experience. I can always trust Rod to provide good sound advice for my car maintenance.
Thanks for saying such incredible reviews about Rod! We're glad to see he's keeping up the great work!
The instrument panel showed “check transmission “ “check emission system”. The symptoms;slippage, sputter and bang into gear . I had just arrived in Pittsburgh from my high speed drive from New Jersey when these symptoms occurred . My local contact suggested that I limp my way to Baeirl Acura service Dept. I called first and was warmly greeted by Marissa who suggested that I either drive or have it towed . It was a dreary rainy morning when I drove right up to the inside service door. John, one of several service technicians greeted me and took my information. He was reassuring suggesting that it may not be the trans - maybe just a sensor. I asked about a loaner vehicle and umbrella . I had 3 Appointments that morning . No problem. Marissa put us into a loaner and John provided an umbrella. Mid day, just as I was wrapping up my last appointment john called with the good news . It seems that I had picked up a bad batch of gas . The problem was cleared and he’ll confirm that after a 10-15 mile drive. When I returned with the loaner to pick up my car I saw that it had been washed . John then showed me an all points inspection that was performed and a service report with a $0 balance . No charge! It gets better. I want to return the umbrella and he says “keep it” I argue but to no avail . He then hands me an Acura tote bag and some sample Acura care bottles . I drove in upset and drove out with a great big smile on my face . What an incredibly positive experience !! I am delighted to recommend Baeirl’ s amazing service department
Thank you so much for the tremendous review of our department! It means a lot to us and we'll be certain to pass it on to the whole team and especially John. Thanks you again for choosing to work with us!
The service team is exceptional. Rod Sassic goes out of his way consistently to assure a good experience. The service is the reason I continue buying Acuras there.
Thank you so much for your positive comments about our team! We sincerely thank you for the positive review, and look forward to seeing you again soon!
Ken was excellent during the purchase of our new Acura MDX. He did everything in his power to make everything a seamless transaction, even while we were a few hours away at work! He had the car ready to roll when we arrived that evening.
We have always enjoyed dealing with the Thoroughbred Ford staff. We have bought several vehicles from them for many years. They make you feel like family! We think a lot of our salesman, Harold Dorsey, would send our friends to him. Great service from all..
We had a very bad experience at a Kansas Kia dealership. They just wanted to sell us a loan. The only way they would negotiate a deal was if we took their financing. My husband and I walked out. The next day I went to Thoroughbred Ford and contacted Harold Dorsey. He fixed me up with a nice 2012 Ford Fusion at a reasonable price. We went to Harold because we had such a good experience with him in 2012 when my husband bought his new Ford pick-up. We never should of went to that other dealership. Thank you to Harold and the staff at Thoroughbred Ford for a wonderful experience. We will be back and so will our friends and family. Donna Leap
I would like to say that this was the easiest car buying experience I have ever had. Ryan and Harold were very helpful,knowledgeable, and courteous. We knew what we wanted, Ryan hooked us up. We were in and out. It wasnt a whole day process, like Ive had in the past. Thanks again for everything!! Much appreciated!!
I had every intention of shopping around such as Dodge and Chevy dealers. I have purchased several vehicles from Mr Dorsey and was quite pleased with his service. My wife sent Harold an e-mail explaining what I was looking for. When I got to the dealership I explained that because we had a trailer and a boat I needed a V8 engineen. He took me out to see the pick up that I bought and that was it, I didn't need to look anywhere else. We also got a fair deal on our trade in and rebates. We will use Thoughbred Ford and Harold Dorsey again.
Thank you very much for the kind words about the Dealership and Harold Dorsey! We hope you love your pickup!
I have bought new vehicles since 1979 and I have always found it to be a dreaded process, filled with confusion, the feeling of being railroaded and inaccuracies. I also have never walked into a dealership and been approached in a more friendly , honest way as I was with Harold Dorsey at Thoroughbred. I was not lied to or drilled into making decisions I did not want to make. I was asked what I wanted in a truck, payments etc and I was given what I asked for. The usual promise of one thing and getting another was not in the picture this time. I have never had a better painfree trade to date. Thank You
Our staff offers exceptional customer service. Our facility offers a comfortable, clean and friendly place our customers enjoy doing business at. When our customers arrive at our service department the drive is covered, clean and well lit. Our advisors meet and greet every client with a wireless tablet in hand ready to check the customer and vehicle in with courtesy and speed. If our client elects to wait on their vehicle we have a customer lounge with complimentary Wi-Fi internet, HD Television and a children’s play area in view of our lounge. Free Coffee and bottled water plus a vending machine that offers only 50 cent snacks and soda are always a hit. We also have courtesy shuttles to take you to your home or office while there service is being completed. For extended customer satisfaction service loaner vehicles are available. Customer satisfaction is our goal. Henry Brown Buick GMC has a service and sales Business Development Center in place that helps meet this goal. Setting appointments, customer follow up and promoting our brands are a small part of this department’s worth. The Henry Brown Auto Group sponsors many local teams and charitable organizations. We are proud to be a part of this great community and enjoy the ability to give back.
Risk Factors: Contingent Financial Advisory Fees and Prior/Potential Future Relationships of Fairness Opinion Providers
It’s likely that the SEC Staff is issuing some comments suggesting – or insisting – on the inclusion of a risk factor regarding contingent financial advisory fees and prior/potential future relationships of fairness opinion providers.
For example, below is a risk factor from page 22 of the joint proxy/prospectus relating to the acquisition of Albertsons by a consortium led by Supervalu (Albertsons also received a fairness opinion from Houlihan Lokey whose fees were not contingent on the outcome of the transaction):
“Some of the financial advisors to Albertsons and Supervalu have had prior business relationships with one or more of the parties to the transactions and are entitled to contingent fees in connection with the transactions.
Albertsons’ fee arrangements with Goldman Sachs and Blackstone, and Supervalu’s fee arrangements with Lazard, are structured so that certain fees are paid only if certain transactions are completed. The aggregate transaction fee payable by Albertsons to each of Goldman Sachs and Blackstone, the principal portion of which will only be payable upon completion of the transactions contemplated by the merger agreement, is currently estimated to be approximately $24.1 million. Similarly, under the terms of Supervalu’s engagement letter with Lazard, $15.5 million of consideration will be payable to Lazard only at the effective time of the Supervalu merger.
In addition to these contingent fee arrangements, Goldman Sachs has previously provided investment banking services to each of the parties to the transactions and/or their affiliates from time to time. These past services include, among others, acting as a participant in revolving credit facilities of Albertsons and Supervalu and providing financial advisory services to CVS and certain of Cerberus’s affiliates in connection with past acquisitions. Similarly, in the past Lazard has provided investment banking services to Supervalu for which it has received customary fees.
In addition, all of the financial advisors may provide services to the parties to the transactions in the future. For a more detailed description of the fee arrangements and past relationships of the financial advisors, see “Opinion of Albertsons’ Financial Advisors—Opinion of Goldman Sachs” beginning on page 56, “Opinion of Albertsons’ Financial Advisors—Opinion of Blackstone” beginning on page 58, and “Opinion of Supervalu’s Financial Advisor” beginning on page 77.”
Permalink: https://www.deallawyers.com/blog/2006/06/risk-factors-contingent-financial-advisory-fees-and-priorpotential-future-relationships-of-fairness.html
The second installment of our M&A Boot Camp for this summer is now available: “Cross-Border Acquisitions: A Buyer’s Perspective.” Join Elizabeth (“Libby”) Kitslaar and Phil Stamatakos of Jones Day as they walk us through the special issues that you will face in a cross-border deal.
Permalink: https://www.deallawyers.com/blog/2006/06/cross-border-acquisitions-a-buyers-perspective.html
Yesterday, the FTC and DOJ announced that they are implementing an electronic filing system that will allow the ultimate parent entities of the acquiring and acquired persons to submit premerger notification filings required by the Hart-Scott-Rodino Act online. This should substantially improve the filing process by eliminating the time and expense of duplicating and submitting hard copies of the forms and attachments required to be filed under the HSR Act and related rules.
2. complete the electronic version of the Form and submit the Form and all attachments electronically; or
3. complete the electronic version of the Form and submit it electronically while submitting all attachments in paper.
Last Friday, Brian Breheny, Chief of Corp Fin’s Office of Mergers and Acquisitions was the guest speaker at a meeting of the Association of the Bar of the City of New York Special Committee on Mergers, Acquisitions and Corporate Control Contests. Brian discussed a number of topics of interest; following is a brief summary of those issues (as is always the case, Brian noted that his views were his own views and not the views of the Commission or his fellow staff members):
– it is unclear as to when the Commission may adopt the final rule amendments, although Brian thought it was possible that the amendments might be adopted this year;
– Brian noted that it is likely that changes will be made before adoption to address some of the comments;
– he noted that expanding the proposed compensation exemption and compensation committee safe harbor to issuer tender offers was uniformly recommended and that he thought those changes would be consistent with the Commission’s intention for proposing the amendments;
– he also noted, however, that certain of the other proposed changes, such as providing a carve out from the best-price rule for commercial arrangements or a de minimus ownership exemption, were given serious consideration during the proposing stage; and
– finally, Brian noted that he was keenly aware of the concerns raised by commentators about the need for the changes to result in an effective exemption and safe harbor.
– the office of mergers and acquisition continues to study whether recommendations should be made to the Commission to change certain of the cross-border tender offer rules;
– the data provided by bidders to date is that certain of the rules, such as the 30-day look back to determine share ownership levels, are difficult to comply with; and
– the office and, for purposes of Rule 14e-5, the staff of the Division of Market Regulation, is considering whether certain consistent relief granted since the adoption of the cross-border rules could be handled in a global exemptive order.
– the staff of the office of mergers and acquisitions and the Division of Market Regulation is considering the comments received by the Commission to the NASD’s proposed Rule 2290;
– certain language changes to the proposed rules may be necessary to address potential inconsistencies in the proposed language of the rule; and
– the ABCNY Committee reiterated concerns regarding requirement for policy/procedure re: differential compensation to officers, directors and other employees.
– the staff continues to view compliance with the beneficial ownership reporting rules as a high priority;
– the staff has heard concerns that hedge funds and/or others may knowingly be crossing the line and acting in concert pursuant to an agreement or arrangement without filing a Schedule 13D to reflect the Group’s beneficial ownership and plans, etc.; and
– the staff will aggressively pursue willful violations of Section 13(d) if it becomes a aware of such conduct.
– the ABCNY Committee questioned the staff policy related to including a risk factor regarding contingent financial advisory fees and requesting (in a non Rule 13e-3 transaction) that filers provide the staff on a supplemental basis, copies of board materials not referenced in background section of the proxy/registration statement so that the staff could consider the need to refer to just board materials; and
The first installment of our M&A Boot Camp for this summer is now available: “Conducting Due Diligence: Through the Eyes of the Associate.” Join Deborah Bentley Herzog and Mike Woodard of McGuire Woods for an entertaining session that teaches the basics of what you need to know about conducting due diligence, with an emphasis on what issues and traps associates should seek to spot and resolve.
Permalink: https://www.deallawyers.com/blog/2006/06/conducting-due-diligence-through-the-eyes-of-the-associate.html
Earlier this week, the SEC’s Divisions of Market Regulation and Corporation Finance issued this no-action response to AstraZeneca in connection with a cross-border merger. As Jim Moloney notes, the relief granted is pretty standard for a U.K. cross-border deal of this kind.
However, the US ownership level in the target is fairly high (43.7%). Not the highest that Jim has seen – the higher the US ownership, the more reluctant the Staff tends to be in granting relief. The relief basically permits the offer to follow U.K. rules and regulations. The offer also contemplates “loan notes” as consideration for non-U.S. holders, which is fairly common as well.
From ISS’ Friday Report: “A Delaware judge has approved a revised settlement to resolve a lawsuit by an international coalition of institutional investors over News Corp.’s “poison pill” takeover defense. Delaware Chancery Judge William B. Chandler III asked the parties to revise the settlement’s limits on future lawsuits over takeover defenses after Liberty Media objected to the wording as “overly broad.” The judge approved the revised agreement June 1, Bloomberg News reported.
The suit by the Australian Council of Super Investors, the Connecticut Retirement Plans and Trust Funds, and U.K. and Dutch pension funds claimed that company officers and directors broke a promise made in 2004 when News Corp. sought shareholder approval to reincorporate from Australia to the U.S. Less than a month after the reincorporation vote, the company adopted a poison pill after Liberty disclosed that it had acquired a 17 percent stake. In August 2005, the board extended the pill for another two years without seeking shareholder approval, prompting the institutional investors to sue.
Under the settlement, News Corp. will ask shareholders to vote on a two-year extension of the pill at the company’s annual meeting in October. If shareholders don’t approve the extension, then the company can either let the pill expire or treat the vote as advisory and continue the litigation.”
Permalink: https://www.deallawyers.com/blog/2006/06/judge-approves-revised-news-corp-investor-accord.html
From the ISS “Corporate Governance Blog“: “For the first time since the mid-1990s, the proliferation of takeover defense features at major U.S. corporations has begun to slow, and several defenses are now in decline, according to a new study by ISS’ Governance Research Service (GRS).
For example, the study found that active “poison pills” are in place at barely more than half of the surveyed companies. Given this trend, maintaining a pill may soon no longer be considered “standard practice,” along with classified board structures.
The 2006 edition of the Corporate Takeover Defenses (CTD) study surveyed corporate control features at 1,925 public firms as of the end of 2005. As in previous years, the biennial analysis finds that the most prevalent defenses remain blank-check preferred stock, advance notice requirements, golden parachutes, classified boards, and poison pills, each of which is found at a majority of the firms tracked.
Remarkably, though, the proportion of companies with an active poison pill or a classified board declined for the first time in many years, along with several other defenses once thought to be impregnable. The proportion of firms with pills (also known as “shareholder rights” plans) dropped from 55.1 percent two years ago to 51.2 percent.
Although shareholder proposals requesting companies to redeem poison pills or put them up for investor approval routinely receive support from a majority of voting shareholders, companies have traditionally been reluctant to comply with such requests. At least 119 of the companies profiled have taken action to eliminate their poison pills in the last five years, however, and others have amended their pills to institute “shareholder friendly” features such as Three-Year Independent Director Evaluation (TIDE) provisions or qualified offer provisions to assuage shareholder antipathy toward those defenses.
Another of the most effective takeover defenses, staggered election of directors, remains the fourth most popular defense, but the prevalence of classified boards also declined for the first time this decade, from 59.7 percent of the companies (as of the 2004 CTD edition) to 56.4 percent. Growing opposition to staggered board elecÂtions by institutional investors has made it more difficult for corporations to justify them, and requests for the repeal of classified board structures continue to be one of the most numerous and most popular shareholder proposals. In 2005, such proposals received support from an average of 63.2 percent of votes cast.
The last few years have seen sizeable jumps in the number of management proposals seeking repeal of staggered board bylaw or charter provisions. Clearly, investor pressure to eliminate this takeover defense is finally driving real change. Nevertheless, many companies continue to enter the public market with staggered boards, which they assert enhances stability and continuity of the board, and these typically require significant effort to declassify. The supermajority vote requirements often needed to repeal or amend classified board provisions–usually 80 percent of outstanding shares–have hindered some companies from eliminating their staggered board structures. All but one of the 22 such proposals voted on in 2003 in the study universe received enough votes to “pass,” however, as did all but four of the 46 proposals in 2004 and three of 45 proposals in 2005.
What’s more, these changes are occurring in a fairly robust mergers and acquisitions market, which began to rise again after 2002. Despite some evidence that growth through mergers often fails to deliver higher returns, acquisitions–both friendly and hostile–remain a key component of many companies’ growth strategies. Institutional activists and value investors continue to utilize shareholder proposals and proxy fights to inspire change at under-performing companies, and recently hedge funds have emerged as new players in instigating governance changes through often hostile advances. Proposed Securities and Exchange Commission rules that would permit companies to post proxy statements on the Internet, rather than requiring them to mail the statement to shareholders, are expected to boost the incidence of proxy fights, since costs to provide proxies would drop for dissidents as well as issuers.
Several other defenses that were popularized in the 1980s continue to lose ground, the study found. The ratio of companies with fair price provisions, for example, peaked at 33.2 percent in 1993, but has continued to fall since and now stands at just 19.2 percent (compared with 19.8 percent at the end of 2003). Similarly, the proportion of companies requiring supermajority vote requirements to approve mergers, which peaked at 18.1 percent in 1993, shrank to 14.9 percent as of 1997. Prevalence of this provision reached 15.5 percent at the end of 2001, but then dropped to 14.6 percent by the end of 2005.
Meanwhile, the pace at which companies are erecting barriers against proxy contests and enacting rules to maintain tight rein over shareholder meetings has slowed to a crawl. The percentage of companies that have adopted provisions to limit shareholders’ right to call special meetings, which doubled in little more than 10 years, from about 24 percent in 1990 to 49.5 percent as of the end of 2001, stands only slightly higher, at 49.7 percent, as of the end of 2005.
By the same token, the proportion of companies that restrict shareholders’ right to act by written consent in lieu of a special meeting–which increased dramatically from about 35 to nearly 44 percent between 2000 and 2002 and rose another 3 percentage points by 2004–increased just 1.4 percentage points in the last two years to 48.2 percent. Typically, proposals to change these shareholder rights are put forth in bundled resolutions with a merger, reincorporation, or restructuring, which shareholders are more likely to approve than stand-alone restrictive resolutions, so it appears that fewer companies are now requesting these changes.
Another provison that remains on the rise, though its proliferation has slowed, requires shareholders to give advance notice of an intention to present director nominations or other motions from the floor. This feature, virtually unheard of in the early 1990s, has become the second most prevalent defense; nearly 81 percent of firms now have advance notice provisions, up from 77 percent two years ago. As of 1995 (the first year they were tracked), these notice requirements were present at only about 44 percent of the companies examined.
Golden parachutes–executive severance arrangements contingent on a change in corporate control–have been a popular management retention tool for many years, and their prevalence increased significantly in the past two years from 73.4 percent to 77.6 percent. The terms of these typically generous severance agreements vary considerably, but most of those packages provide for payments based on three years’ salary and bonus, acceleration of stock options, and sometimes other incentive compensation and extra pension credit. Because most companies now consider golden parachutes to be critical components of compensation packages, and shareholder approval of them is not required, these arrangements have continued to spread. This trend has occurred despite the fact that investor activists concerned about excessive severance payments, sometime dubbed “pay for failure,” have made anti-golden parachute proposals a cornerstone of their proxy season campaigns, with increasing success.
While most companies continue to maintain strong defenses against hostile shareholder action and to guard against perceived unfair and abusive actions by dissident groups, the findings in this year’s study signal that the most potent defenses have peaked for the time being.
Meanwhile, shareholders and activists continue to monitor companies and their boards to ensure that takeover defenses are being utilized properly. In the last few years, shareholder proposals to eliminate classified boards and supermajority vote requirements and to eliminate or allow a shareholder vote on poison pills have garnered average support of more than 50 percent at U.S. companies each year, and the message appears to be finally getting through to corporate management and boards.”
Last week, the NYSE’s Proxy Working Group unanimously adopted six recommendations embodied in this Final Report and Recommendations. As I blogged last month, the principal recommendation is the one that would amend the NYSE’s Rule 452 (commonly known as the 10-day broker voting rule) to make director elections a non-routine matter. This means that brokers would no longer be permitted to vote the shares of beneficial owners who do not provide specific voting instructions within 10 days of the close of proxy voting. As many of you know, brokers typically side with the board and management when they vote for directors. Here is a related article from BusinessWeek.
Coupled with hedge fund activism, this could mean that directors who are subject to withheld votes will find it much more difficult to obtain a majority vote. Add in the growing majority vote movement and this is a whole new ballgame folks! It is not hard to find director elections this year where directors received a majority vote- but would not have done so if this rule had been effective.
I predicted as much for the recent Home Depot election. Consider how high the level of withhold votes was there without the extended media and Web campaign that took place at Disney a few years ago. Wake up and smell the coffee Mrs. Bueller, the playing field is shifting all around us! The NYSE wants the SEC to approve the rule change so it can be effective for the 2007 proxy season! Better lock in your favorite proxy solicitor now because demand is gonna be sky high!
Thankfully, the Proxy Working Group rejected the idea of totally eliminating broker voting, recognizing that it plays an important role in allowing companies to achieve a quorum for regular meetings.
1. The elimination of discretionary broker votes for director elections by amending the NYSE’s Rule 452.
2. The SEC’s review of the OBO-NOBO rule to make it easier for companies to communicate with their street-name shareholders.
3. The NYSE’s engagement of an independent party to analyze and make recommendations to the SEC regarding the structure and amount of fees paid to ADP.
4. The SEC’s study of the role of groups like ISS and Glass Lewis that impact the voting decisions over shares in which they have no ownership and no economic interest. The Proxy Working Group believes that there is the potential for conflicts of interest and/or other issues given the multiple roles that such groups play in the proxy season.
6. The NYSE’s monitoring of the impact of amending Rule 452 to make director elections a “non-routine” matter.
The NYSE Staff seeks comments by the end of June – it will share these comments with the SEC. After reviewing these comments, the NYSE Board will consider them and any proposed rule changes will then be filed with the SEC so that the SEC can then directly solicit additional public comment. So for those of you worried about the tight window period for commenting now, recognize that the public will have two opportunities to comment. Lots more to come on these groundbreaking recommendations!
As part of the NYSE’s Proxy Working Group process, they had this Investor Attitudes Study prepared by the Opinion Research Corporation to gain a better understanding of investors’ knowledge of the existing proxy voting process.
No surprise that the study results show that investors generally are confused about proxy mechanics since so few of us professionals fully understand how it all works. In fact, I was floored that 25% of the respondents understood that their brokers get to vote in their place if they didn’t respond. My guess is that no more than 5% of shareholders would have understood that…
In this podcast, Todd Lenson and Bruce Schneider of Stroock & Stroock & Lavan provide analysis behind Vice Chancellor Strine’s interesting opinion in ABRY Partners V, L.P. v. F&W Acquisition LLC et. al. (and here is their related article), including :
DOL Proposal Would Define ‘Fiduciaries’ of Employee Benefit Plans to Include Providers of Fairness Opinions to Plans
Last Thursday, the Department of Labor proposed regulations that would, if adopted, significantly expand the circumstances in which a person will be treated as a fiduciary under ERISA by reason of providing investment advice for a fee to an employee benefit plan. The proposed regulation was published in the Federal Register on October 22nd – the comment period expires on January 20th.
Specifically, under paragraph (c)(1)(i)(A) of the proposal, the types of advice and recommendations that may result in fiduciary status under ERISA Section 3(21)(A)(ii) are: Advice, appraisals or fairness opinions concerning the value of securities or other property; recommendations as to the advisability of investing in, purchasing, holding, or selling securities or other property; or advice or recommendations as to the management of securities or other property.
While the proposal contains a number of exceptions that may be available in specific circumstances, it otherwise significantly expands the situations in which a financial advisor will be treated as an ERISA fiduciary for providing investment advice to an employee benefit plan, a plan fiduciary or a plan participant – even on a one-off basis and where there is no understanding that the advice will be the primary basis for an investment decision.
Permalink: https://www.deallawyers.com/blog/2010/10/dol-proposal-would-define-fiduciaries-of-employee-benefit-plans-to-include-providers-of-fairness-opi.html
Last week, the UK Panel on Takeovers and Mergers published the conclusions of its review, commenced in June 2010, regarding possible amendments to the UK Takeover Code, which governs the conduct of takeover bids involving UK listed companies. The review, conducted by the Code Committee of the Takeover Panel, was prompted by Panel, investor and governmental criticism of certain takeover practices in recent years, including in a number of highly publicized and controversial takeover situations in the UK market.
While the proposed amendments are not yet published, the tone and direction of the Committee’s paper suggests a significant shift in the approach to hostile bids for UK listed companies. The Code Committee generally concludes that “hostile offerors have, in recent times, been able to obtain a tactical advantage over the offeree company to the detriment of the offeree company and its shareholders.”
Further, in a significant departure from long-accepted UK practice that in a contested situation the target’s board should accept the highest bid with priority to shareholder interests, the Code Committee specifically states that the amendments to the Code will clarify that target boards may “take more account of the position of persons who are affected by takeovers in addition to offeree company shareholders,” primarily employees of the target company. Offeree companies will “not be limited in the factors they may take into account in giving their opinion” on a bid, and the Code will be amended to require disclosure of additional information so that “the offeree company board and all other interested constituencies [can] consider the long term effects of an offer on the merged business in all circumstances.”
The review contains other significant proposals, including: formalizing the “put up or shut up” period, currently discretionary under Rule 2.2, to require that a rumored bidder, within 28 days of the published rumor, either launch a bid, or state that it will not bid and be subject to the 6-month “shut up” period; a strict prohibition on inducement (or break) fees, currently generally capped at 1% of the value of the offeree company; as well as required disclosure of financing arrangements, the offeror’s financial condition pro forma for the bid (even in cash deals), the terms of any financing for the offer (including documentation) and detailed information regarding advisory fees payable to lawyers, bankers, brokers, accountants, public relations and other advisors. These, when taken together with the traditional requirement to have committed certain funds and the new accelerated “put up or shut up” deadline, may increase bidder costs (without reimbursement) and reduce the time that bidders will have to arrange transactions.
The amendments will no doubt spark renewed interest in the strategy and tactics central in any takeover bid, friendly or hostile, for a UK listed company. It remains to be seen whether the proposed changes will result in a more level playing field between hostile bidders and their targets in the UK , but it cannot be doubted that the Code Committee’s recommendations will significantly affect future UK takeover bids. More broadly, and of great significance for market participants in all markets, is whether these fundamental changes in outlook and orientation in the UK will herald an era in which hostile takeovers become more difficult, in which greater deference is given to non-shareholder interests and constituencies, including state interests in preventing or limiting cross-border change in control transactions and transactions that are perceived to have a material impact on domestic employment or product markets.
Permalink: https://www.deallawyers.com/blog/2010/10/uk-takeover-panel-publishes-review-of-certain-takeover-rules.html
Recently, Frederic W. Cook & Co. issued this report that examines change-in-control trends over the three year period, 2007-2010. It shows that practices are evolving as multiples come down and double-triggers become more popular, as well as gross-ups going the way of the Dodo…
Permalink: https://www.deallawyers.com/blog/2010/10/study-evolution-of-change-in-control-practices-from-2007-vs-2010.html
The Delaware Chancery Court recently upheld the validity of a bylaw amendment adopted by the stockholders of Airgas, Inc. at its September 2010 annual meeting that accelerates the date of Airgas’s next annual meeting to January 2011, barely four months after its 2010 annual meeting was held. The bylaw amendment was proposed by Air Products and Chemicals, Inc., which is aggressively pursuing a $5.5 billion hostile bid for Airgas. At the September 2010 annual meeting, Air Products successfully obtained all three board seats that were up for election on Airgas’s nine-member classified board. With the bylaw amendment, Airgas will have the opportunity to elect three more directors to the Air Products board much earlier than it otherwise would have been able to.
The decision turns on the fairly typical wording of the annual meeting and staggered board provisions in Airgas’s charter and bylaws. Airgas has appealed the ruling to the Delaware Supreme Court, but unless it is overturned or companies are able to modify their charter or bylaw provisions to address this issue, Chancellor Chandler’s decision may substantially weaken the defenses of a number of companies with classified boards–a practice by which only one third of the members of the board of directors is elected at each annual meeting and directors cannot be removed except for cause.
The significance of the bylaw amendment in Airgas’s situation is accentuated by the fact that the 2010 Airgas meeting was held late in the proxy season, making the proposed January 2011 meeting only four months away. As a practical matter, a similar bylaw amendment would present less of an issue for companies with classified boards that hold their annual meetings in the spring, since an accelerated January annual meeting would still be seven to eight months away, and, applying Chandler’s textual analysis (as discussed below), a court is less likely to uphold an amendment that would cause the company to hold its next annual meeting in the same calendar year.
At the heart of the Airgas dispute is whether the company’s annual meetings must be held one year apart or once a year, and, if once a year, whether that refers to a calendar or fiscal year. Neither “annual” nor “year” is defined in Airgas’s charter or bylaws.
Airgas argued that the bylaw amendment, which received the approval of 51% of the votes cast (representing 45.8% of the shares entitled to vote), was invalidly adopted because it conflicted with the director terms set forth in Article III of the Airgas bylaws and therefore needed the approval of at least 67% of the shares entitled to vote. Article III sets forth the classes and terms of the classified board. It provides that each class of directors shall “hold office for a term expiring at the annual meeting of stockholders held in the third year following the year of their election” (emphasis added). Article III is protected by a supermajority vote provision in the Airgas charter, which requires that any amendment or repeal of Article III, or the adoption any provision inconsistent therewith, must be approved by the affirmative vote of at least 67% of the outstanding shares. Airgas argued that moving up the 2011 annual meeting would impermissibly shorten the terms of the directors up for election and therefore needed such supermajority approval.
Reasoning that “the operative provisions of Airgas’s bylaws and charter in dispute here contain language that may fairly be read to have more than one meaning,” and that he must therefore construe the ambiguous terms “in favor of the shareholder franchise” (i.e., in such a way as to support the shareholder-approved bylaw amendment), Chancellor Chandler interpreted Article III to provide that the class of Airgas directors who were elected in 2008 will have their terms expire in 2011– i.e., in the “third year” following their election and not “three years” after their election.
Chancellor Chandler went on to hold that by defining the director terms by reference to their expiration “in the third year” following their election, the drafters of the charter opted not to specify a 36-month or 3-year term, and that therefore the bylaw amendment did not cut short their respective terms.
In response to Airgas’s argument that the bylaw amendment would require the 2010 and 2011 meetings to occur in the same fiscal year, Chancellor Chandler held that “under the ‘rule of construction in favor of franchise rights,’ I cannot read the word ‘fiscal’ into the charter, and must instead construe the ambiguous terms against the board, which leads to my conclusion that Airgas’s annual meeting cycle can validly run on a calendar year basis and still be consistent with the charter.”
The court adopted a similar approach to statutory interpretation in analyzing whether the bylaw amendment violated Delaware law, holding that “the default rules in Delaware do not require waiting a ‘year’ or ‘twelve months’ or any set amount of time from one annual meeting to the next.” Noting that DGCL §211(c) explicitly permits the court to require annual meetings to be held within 13 months of the last annual meeting, Chancellor Chandler emphasized that it does not address whether the annual meeting interval may be shortened by any amount of time.
Companies with classified boards should review the specific wording of their relevant charter and bylaw provisions
We would advise all companies with staggered boards to review closely the text of their charter and bylaw provisions, with a view to assessing their potential exposure on this issue and determining whether revisions to address the decision are possible.
Permalink: https://www.deallawyers.com/blog/2010/10/september-october-issue-deal-lawyers-print-newsletter-3.html
Yesterday, the Delaware Supreme Court issued an opinion affirming the Court of Chancery’s decision in Selectica, Inc. v. Versata, Inc., C.A. No. 4241-VCN, 2010 WL 703062 (Feb. 26, 2010), which upheld a board’s adoption of a poison pill rights plan with a 4.99% triggering threshold, designed to protect the usability of the corporation’s net operating losses (“NOLs”), and a special committee’s subsequent decision (following a deliberate trigger of the pill) to deploy the exchange mechanism in the rights plan to dilute the triggering stockholder. The Supreme Court largely affirmed the reasoning employed by the Court of Chancery, and held that the board of directors had met its burden under the Unocal standard. Here is a discussion of the facts of the case.
The Supreme Court upheld the Vice Chancellor’s post-trial rulings that the board of directors had reasonable grounds to believe that the triggering stockholder’s purchases threatened the corporation’s NOLs and that the NOLs were corporate assets worth protecting. The Supreme Court further held that the NOL pill was nonpreclusive and within the range of reasonableness under the circumstances. The Court noted that the preclusion test enunciated in Unitrin, focusing on whether a defensive device renders a bidder’s attempt to wage a proxy contest and gain control “either mathematically impossible or realistically unattainable,” is analytically speaking a single test, because mathematical impossibility is “subsumed within the category of preclusivity described as ‘realistically unattainable.'”
The Court also reiterated that the Unocal review is context-specific, and emphasized that its ruling should not be taken as “generally approving the reasonableness of a 4.99% trigger in the Rights Plan of a corporation with or without NOLs.” The Court also emphasized that a potential future decision by the board to retain the NOL pill in the face of another threat would be subject to fresh evaluation under the Unocal standard at that time.
Cliff Neimeth of Greenberg Traurig notes: One thing we didn’t get a chance to mention on our webcast last week is that drafters of rights agreements should consider footnote 244 in VC Strine’s Yucaipa decision. He suggests that in an NOL rights agreement (where the pill trigger is 4.99%) the definition of “beneficial ownership” should be drafted more narrowly than the expansive “13D definition” commonly used in traditional pills.
He suggests that only economic ownership (outright purchases of the company’s stock) and not voting agreements and arrangements should determine “beneficial ownership” because the NOL pill is designed for a very narrow and specific purpose – the preservation of a material corporate asset – the loss of which is measured, for Internal Revenue Code purposes, by actual purchases and sales among 5%(+) holders for purposes of IRC section 382. Whereas, a traditional pill is designed to protect the company from a broader array of change-in-control threats that may be occassioned by more garden variety 13D group type acquisition activities, and the traditional pill trigger customarily will be set at the 20% (i.e., ISS recommended) 15% level. Strine, in fact, suggests a dual definition of beneficial ownership where an NOL pill feature is combined with a traditional pill in the rights agreement.
In that Selectica is on appeal to the Delaware Supreme Court it will be interesting to see if Strine’s message is acknowledged. In any case, it signals the Delaware Court of Chancery’s thinking on the subject and should not be ignored by drafters of future NOL pills.
Cash-strapped Fortis Healthcare Ltd, which is in the process of finding a new investor, said Wednesday its board would meet on 13 July to consider raising funds through issue of securities on a preferential allotment basis. The Fortis Healthcare board will meet “to consider, and if thought fit, approve raising funds through issue of securities on a preferential allotment basis”, it said in a regulatory filing. It, however, did not disclose details of the quantum of funds to be raised.