Several months ago, we wrote about the possibility of an increase in hostile takeover attempts. It seems to have come to fruition as a number of major battles are playing out at present, including Novartis AG’s offer Alcon Inc., Astellas Pharma’s hostile bid for OSI Pharmaceuticals Inc. and Air Products and Chemicals aggressive pursuit of Airgas Inc. Hostile bids are often followed by litigation and posturing on both sides and the aforementioned deals are no exception.
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Prudential has introduced an innovative, eco-friendly way to encourage its shareholders to cast their proxy votes. Shareholders who vote their 2010 proxy — whether they do so via the Internet, by phone or through the mail — can select a free gift from Prudential. They can choose a tote bag made of recycled organic cotton or have a tree planted in their honor.
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In an earlier posting, we discussed the Securities and Exchange Commission’s recently issued interpretive guidance regarding climate change disclosures in SEC filings. While the SEC has not proposed new disclosure rules with this guidance, the agency is attempting to provide clarity to existing disclosure requirements as they apply to climate change.
The interpretive guidance does not create new legal requirements or modify existing ones, but it does express the SEC’s views regarding when climate change disclosures may be required under current securities laws and regulations. Accordingly, reporting companies should carefully consider whether modification of their historic climate change and other environmental disclosures, if any, is needed in light of the interpretive guidance. It should again be noted that the agency is not taking a position on any facts relating to climate change or global warming.
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Several months back, I penned a column on the growing interest in Strategic Equity Offerings (SEO), also known as ATMs ("at the market" offerings). I received a number of comments and calls seeking additional information; hence, I thought an update would be in order. First a bit of a refresher: An SEO is a registered secondary offering that, unlike a traditional spot offering, is traded "from time to time" over the course of up to two years. The SEO allows issuers to tailor their equity raising to their financing needs. The issuer is in complete control of the pricing limits of where stock is sold. Furthermore, the SEO does not need to be used at all, but is available when and if capital is required. Moreover, the issuer is free to pursue other financing options while the SEO is in place if the company so chooses. The issuer would simply discontinue the program, which can be subsequently resumed at the company’s discretion. In addition, the SEO product can be used by large selling shareholders.
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February 23rd, 2010
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The Securities and Exchange Commission recently announced a series of steps to educate investors about proxy voting and support greater investor participation in corporate elections.
The measures include amending the SEC’s e-proxy rules, issuing an Investor Alert, and creating new Internet resources that explain the proxy voting process in plain language. In a statement, SEC Chairman Mary L. Schapiro said, "Investor participation in elections at companies they own is critical to effective corporate governance."
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February 22nd, 2010
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Recently, the SEC proposed amendments to Rule 10b-18 designed to "clarify and modernize" the rule to address changes in trading practices and technologies since its adoption. Rule 10b-18, under the Securities Exchange Act of 1934, provides an issuer a non-exclusive "safe harbor" from liability for market manipulation for issuer stock repurchases, provided the issuer complies with the Rule’s manner, timing, price and volume conditions.
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February 18th, 2010
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Apple just debuted its long-awaited iPad tablet computer amid much fanfare, hype and buzz. How it all pans out is another story. All the hoopla surrounding the iPad’s launch got me to thinking about the caché that Apple has. Having represented technology companies for nearly three decades, I came to see that the way companies develop caché, assuming they are worthy, is through something I refer to as "The Elvis Factor."
Mention Elvis Presley to any number of people and different images come to mind. (If you don’t know who he is, check the ‘net or ask your parents or maybe even your grandparents.) Many of this generation will undoubtedly conjure up images of a bloated Las Vegas lounge singer clad or, more likely, stuffed into a sequin-studded jumpsuit. Others will recall him as a movie star who basically played the same character and sang his way through one B-movie after another. A dwindling number whose memories stretch back far enough will recall the Elvis who revolutionized rock music more than 50 years ago – the one who electrified a generation of young people while scaring their parents half to death.
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February 16th, 2010
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Much has been written about the disintermediation taking place in our stock markets. Securities analysts and stockbrokers are fleeing (or being told to flee) Wall Street in great numbers. These individuals are particularly important especially when it comes to developing sponsorship for small cap stocks for they are the "story tellers," in that they help by "telling or explaining a company’s story."
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February 11th, 2010
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In honor of his birthday, I thought I’d dedicate this column to one of my favorite presidents, Abraham Lincoln. Regardless of your particular discipline, I believe that there’s much about communications — applicable to today — that we can learn from Mr. Lincoln:
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Federal securities fraud class action activity in 2009 was down sharply compared to 2008 and historical averages, according to Securities Class Action Filings—2009: A Year in Review, an annual report prepared by the Stanford Law School Securities Class Action Clearinghouse in cooperation with Cornerstone Research. The full text of the report is available at the Stanford Law School Securities Class Action Clearinghouse (http://securities.stanford.edu) and Cornerstone Research (http://securities.cornerstone.com) websites.
According to the report, a total of 169 federal securities class actions were filed in 2009, a 24 percent decline from the 223 observed in 2008, and 14 percent below the average of 197 observed between 1997 and 2008. Litigation activity related to the credit crisis declined even more markedly from 100 filings in 2008 to only 53 in 2009, a 47 percent decrease. Only 17 of those filings occurred in the second half of 2009.
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