TheCorporateCounsel.net

On Wednesday, the SEC announced that it will take action on a number of items, including:

– adopting changes to the tender offer best price rule next Wednesday, October 18th

– delaying a proposal to amend Rule 14a-8 from next Wednesday to December 13th (remember this is the AFSCME case response from the SEC)

– proposing guidance on internal controls on December 13th (part of the SEC’s recommended package of 404 relief announced by the SEC a few months ago)

– adopting rules for foreign private issuer deregistration on December 13th

– adopting rules for e-Proxy (i.e., Internet proxy delivery) on December 13th

Based on the SEC’s notice about next week’s “best-price” rule consideration, it appears that the SEC will apply the amendments to both issuer and third-party tender offers and will clarify that the best-price rule (i) does not apply to securities that are not tendered in a tender offer; and (ii) does not apply to consideration paid according to employment compensation, severance or other employee benefit arrangements with securityholders. It does not appear that the amendments will provide similar exemptive relief or a safe harbor with respect to other agreements with securityholders (e.g., commercial arrangements) or that they will include a de minimus exception.

And as the shareholder proposal rule amendment quickly became a political issue – and potentially a 3-2 vote along partisan lines if shareholder access was not included as part of the SEC’s proposal – my guess is that the delay might have been to move it to a post-election date…

SEC Issues NYSE’s Proposal to Eliminate Treasury Stock Exception

Last week, the SEC issued the NYSE’s proposal to eliminate the treasury stock exception from the requirements for shareholder approval under Section 312.03. Under current rules, listed companies have to calculate the number of shares issued to determine whether the shareholder approval requirement is triggered. This calculation may be affected if the company reissues treasury stock. Historically, this rule has not applied to any issuance of treasury shares. Under the NYSE’s proposal, listed companies would be required to include treasury stock in that calculation. There is a 21-day comment period for the proposal.

If adopted as proposed, the NYSE’s proposal would also:

– require listed companies to notify the NYSE when they issue treasury stock

– clarify that the shareholder approval requirement for related-party issuances to a “series of related transactions”

– clarify that “market value” means the official closing price as reported to the Consolidated Tape immediately before entering into a binding agreement selling securities

The NYSE also put companies on notice that any agreements entered into after 5 business days from the date the SEC publishes notice of this proposal in the Federal Register will not be grandfathered. Not much of a transition period and something to be aware of as this window period will close shortly.

You Ain’t Really Done Vegas…

…until you can say you have done time in her emergency rooms. I spent Wednesday night in a Vegas emergency room. Food poisoning or food allegery. Started puking at noon and by 9 pm, I thought I was gonna die. Couldn’t breathe nor swallow.

The ER was a trip; no proof of insurance required – so standing room only and folks appeared to be near death left and right. So my case was just like anyone else and the wait was loooong. So now I can say I have really done Vegas! I’m so happy to be alive!