Tuesday, November 24, 2009

The Activist Investor Conference: NYC January 21-22, 2010

Shareholder activism has intensified due to highly publicized corporate failures and controversy over executive compensation in light of poor corporate performance. Newly proposed rules to facilitate shareholder participation in board decisions will ensure that the trend continues. All stakeholders in corporate performance should attend this informative and timely event to learn about the latest trends, strategies and outcomes of shareholder activism.

Corporate managers, investors, proxy advisors and legal representatives from all sides will present a 360 degree view of activist investment strategies and their impact on corporate performance and returns. The event examines topics vital to both investors and corporate boards. In addition, the conference will provide plenty of opportunity for networking with peers and experts.


Thursday January 21, 2010

Managing the Impact of the Economic Climate on Investor Relations

Elizabeth Saunders, FD

The Purpose of the Proxy Access Initiative

David Rosewater, Schulte Roth & Zabel

Phil Goldstein, Bulldog Investors

Anne Sheehan, CalSTRS

Chris Young, RiskMetrics

Case Studies of Sucessful Corporate Defenses

David Katz, Wachtell, Lipton, Rosen & Katz

The Activists' Toolkit

Steve Wolosky, Olshan Grundman Frome Rosenzweig & Wolosky

Mark Harnett, MacKenzie Partners

Eric Rosenfeld, Crescendo Partners

Case Study: The First-Time Activist - Dialectic Capital's Sucessful Proxy Campaign at California Micro Devices

John Fichthorn, Dialectic Capital

Bryant Riley, Riley Investment Management

Assessing the Vulnerability of a Board of Directors

Keith Gottfried, Blank Rome

Bob Butler, Veritas Communications

Jared Landaw, Barington Capital

Paul Schulman, The Altman Group

What do Proxy Contests Achieve? Evaluating the Effectiveness of Hybrid Boards

Chris Cernich, Proxy Governance

Defining Corporate Governance

Steve Davidoff, The New York Times DealBook

Timothy Brog, Locksmith Capital

Frode Jensen, Holland & KNight

Rachel Posner, Georgeson

Friday January 22, 2010

The Changing Regulatory Landscape

Jeffrey Morgan, National Investor Relations Institute

John Glenn Grau, Investorcom

Richard Swanson, Arnold & Porter

Executive Compensation Strategies - Balancing Corporate Management Goals and Investor Concerns

Justin Levis, Council of Institutional Investors

Hye-Won Choi, TIAA-CREF

Paul Hodgson, The Corporate Library

Matthew Lepore, Pfizer

Case Study: Shamrock Capital Advisors' Successful Proxy Campaign at Texas Industries

Dennis Johnson, Shamrock Capital Advisors

Strategies and Tactics for Responding to Investor Activism

Steve Balet, Okapi Partners

Sara Antol, Tollgrade Communications

Jeffrey Shapiro, Lowenstein Sandler

Matthew Sherman, Joele Frank Wilkinson Brimmer Katcher

Case Study: The Successful Defense by Target Corporation against the Proxy Campaign by Pershing Square
Capital Management

Mark Harnett, MacKenzie Partners

Joele Frank, Joele Frank Wilkinson Brimmer Katcher

For additional information about the conference and to register
click here.

Friday, November 20, 2009

Legislative & Regulatory Reform Impacting Corporations and Activist Investors

Federal and State legislators have teamed up with financial regulators in an attempt to advance shareholders rights, improve corporate and investment management transparency, reduce systemic financial risk, and better align executive compensation with shareholder expectations.

Below, Hedge Fund Solutions provides a comprehensive summary, with references, of the status of the various legislative and regulatory developments that will affect corporations during 2010 - and will likely make activist investing a more efficient process in the future.


Brief Description



Proxy Access
Federal Legislation

SEC proposed to allow certain shareholders to nominate director candidates, and include nominees in the company’s proxy materials.
SEC promulgated draft regulations, and received over 500 comment letters.

SEC has postponed final ruling until it has reviewed all comments thoroughly, with action likely in early 2010.

Rep. Waters proposed language affirming that the SEC will have the authority to promulgate rules and regulations concerning proxy access.
House Committee on Financial Services approved language, and sent H.R. 3817 to full House on November 4, 2009.
Terms allow SEC rules and regulations to preempt state corporation law on proxy access.
State Legislation

Legislature amended DGCL to allow corporations to amend their bylaws to provide proxy access to shareholders, and to reimburse shareholders for board election expenses.
Governor Markell signed the bill into law in April 2009.

HealthSouth became the first Delaware corporation to amend bylaws pursuant to the DGCL amendments.
See blog post for comments about the DGCL amendments.
Legislation & Regulatory

Impact to Banks
SEC proposed that TARP recipients must allow shareholders to approve executive compensation.
SEC promulgated draft regulations, and received approximately 80 comment letters.

SEC has not indicated when it will issue final regulations.

Impact to Corporations

Rep. Barney Frank proposed a comprehensive say-on-pay law applying to all US public companies.
H.R. 3269 passed House of Representatives in July 2009, referred to Senate Banking Committee. Senate has not indicated when it will schedule hearings or debate.
Several corporations, including Microsoft, have amended bylaws to provide for say-on-pay.
Sen. Dick Durbin proposed a law requiring supermajority approval of excessive executive compensation
S. 1006 introduced in Senate in May 2009, referred to Senate Banking Committee. Senate has not indicated when it will schedule hearings or debate.

Sen. Christopher Dodd proposed legislation including comprehensive say-on-pay provisions
Sen. Dodd has not yet introduced bill into Senate.
Similar to H.R. 2861
Rep. Gary Peters proposed the “Shareholder Empowerment Act of 2009” with various say-on-pay provisions
Rep. Peters introduced H.R. 2861 in June 2009, referred to House Committee on Financial Services.
Similar to Sen. Dodd’s proposed bill
Broker Voting
Impact to Corporations
SEC amended rules about how corporations can count votes from brokers holding shares in Street Name.
SEC approved the final rule in July 2009, effective January 2010.
Director elections will change, particularly for Companies with high proportion of "retail" investors.
Compensation & Governance Disclosure

Impact to Corporations
SEC has proposed more detailed compensation disclosures, and clarified some recent issues about proxy solicitation.
SEC promulgated draft regulations, and received approximately 150 comment letters.
SEC has indicated it will issue final regulations in time for annual meetings in 2010.

Impact to Corporations

Sen. Charles Schumer proposed a comprehensive law called the Shareholder Bill of Rights addressing executive compensation, proxy access, and board of director governance and elections.
S. 1074 introduced in Senate in May 2009, referred to Senate Banking Committee. Senate has not indicated when it will schedule hearings or debate.
See blog post for comments about the proposals.
CEO Succession; Risk Management
Impact to Corporations
SEC will no longer automatically issue “no action” letters in conjunction with shareholder proposals relating to risk management and CEO succession planning
See SEC Staff Legal Bulletin 14E, issued October 27, 2009.
See blog post for comments about the change in the SEC’s policy
Electronic Proxy Solicitation
Impact to Corporations
SEC has proposed updated rules on electronic proxy solicitation.
Comments are due to the SEC by November 20, 2009.

SEC Staff Clarifies 13D Filings

The SEC has updated their rules relating to 13D filings to clarify that "for the purposes of calculating the 10-day time period, the first calendar day after the trade date counts as day number one."

Schedule 13D is a SEC filing that must be submitted to the US Securities and Exchange Commission within 10 days, by anyone who acquires beneficial ownership of 5% or more of any class of publicly-traded securities in a public company. 13D filings are of particular interest to corporations and to other investors since the filer must disclose the "purpose" of their investment. e.g. intention to obtain a controlling interest, demand for board representation, or simply because they believe the security is undervalued.

Schulte Roth & Zabel issued a client alert on this which can be downloaded here.

Thursday, November 12, 2009

The High-Performance Director Conference - 10% Discount to Activist Blog Readers

NASDAQ OMX, Dow Jones cordially invite
you to attend a one-day seminar designed to help Directors stay on top of the most challenging issues facing corporate Board members in 2010.

The High-Performance Director: Navigating 2010

Friday, December 11, 2009

The Metropolitan Club
1 East 60th Street
New York, NY
7:00 a.m. – Registration
7:30 a.m. – Breakfast
8:00 a.m. to 4:45 p.m. – Panel Discussions

Our high-level agenda was developed in collaboration with leading
regulators, government officials, corporate executives and top scholars
who will host panel discussions, compelling debates and keynote interviews on:

• Washington in 2010: an update on current legislation and what it means for Board members
• Globalization: what it takes to successfully govern an international company
• Compensation: what Board members should and should not be doing in terms of dealing with compensation and bonus issues
• Activism: how Boards should be reacting to activists

Speakers include*:
Ram Charan, Business Advisor and Author, Owning Up, The Game Changer, Leadership in the Era of Economic Uncertainty, Leaders At All Levels
Glenn H. Hutchins, Co-Founder and Co-Chief Executive, Silver Lake
Martin Lipton, Founding Partner, Wachtell, Lipton, Rosen & Katz
Ivan Seidenberg, Chairman and CEO, Verizon Communications
Warren S. de Wied, Partner, Wilson Sonsini Goodrich & Rosati

* For a complete list of speakers, visit the program web site

Register Now!

To receive a 10% discount on the standard registration fee please enter ACTIVIST when registering

In addition, Directors can earn Corporate Governance Quotient (CGQ)
credits from the ISS/Risk Metrics Group.

To register and learn more about the seminar go to www.nasdaq.net/directoreducation.

We look forward to seeing you at this exclusive and timely event.

October Activist Investments - 37 Companies Targeted

Below is a summary list of 37 companies targeted by 37 shareholder activists during October.

This information was extracted from Hedge Fund Solutions' Catalyst Equity Research Report(TM), a free in-depth weekly research on activist investments.

Click Here to subscribe to the FREE report.

This report is sponsored by a number of firms with expertise in the activist investing space.

Investment Banking:

SSG Capital Advisors

Legal Advisers:

Olshan Grundman Frome Rosenzweig & Wolosky
Schulte Roth & Zabel
Lowenstein Sandler

Proxy Solicitors:

Innisfree M&A
MacKenzie Partners
Laurel Hill Advisory Group
The Altman Group

Ticker Company Investor
ADPT Adaptec Inc. Steel Partners
ARGL.OB Argyle Security, Inc. Mezzanine Management
ASCMA Ascent Media GAMCO Investors
ASPM Aspect Medical Systems Covidien plc
BARE Bare Escentuals Sandler Capital Management
BASI Bioanalytical Systems Inc Thomas Harenburg
BLDR Builders FirstSource Inc. Stadium Capital Management
BLUD Immucor Inc. VA Partners
COHM.PK Coachmen Industries Inc. GAMCO Investors
DVD Dover Motorsports Marathon Partners
FFHS First Franklin Corp Lenox Wealth Management, Inc
FMMH.OB Fremont Michigan Insuracorp Inc. Steak & Shake Co
GMXR GMX Resources Centennial Energy Partners
GRNB Green Bankshares, Inc. Scott Niswonger
HPOL Harris Interactive Inc. Mill Road Capital
IMMR Immersion Corp Ramius Capital
IPCS iPCS, Inc. Greywolf Capital Management
ITP Intertape Polymer Group Inc. KSA Capital Management
KANA.OB Kana Software KVO Capital Management
LDIS Leadis Technology Inc Dialectic Capital Management
LM Legg Mason Inc. Nelson Peltz
MEG Media General Inc. GAMCO Investors
MGYR Magyar Bancorp Inc. Financial Edge Fund
MYE Myers Industries, Inc. GAMCO Investors
OPTV OpenTV Corp Kudelski SA
PLFE Presidential Life Corp Herbert Kurz
RSG Republic Services inc Cascade Investment
RUBO Rubios Restaurant Alex Meruelo
SURG Synergetics USA Inc Steven Becker
TBTC.OB Table Trac Inc. Doucet Asset Management
TGY Tremisis Energy Acquisition Corp Bulldog Investors
TMEN.PK Thermoenergy Corp Quercus Trust
TRMA Trico Marine Kistefos AS
VII Vicon Industries Inc. Anita Zucker
VXGN.OB VaxGen Inc. Steven Bronson
XOHO.OB XO Holdings Inc. Carl Icahn
YORW The York Water Co. GAMCO Investors

Monday, November 2, 2009

Steel Partners Wins By Written Consent

Steel Partners announced today that they have delivered the requisite number of written consents (more than 50% of outstanding shares) to pass all the proposals they made under their consent solicitation. The proposals included the removal of Adaptec's CEO and one other member from the board of directors and the reduction in the size of the board from 9 to 7 members. Steel now effectively controls 4 of 7 board seats.

Read the press release here.

Sunday, November 1, 2009

When Investors Crack The Whip

The NY Times did a story on Shamrock Activist Value Fund's successful campaign to replace three Directors on the board of Texas Industries a couple weeks ago.

When Shareholders Crack the Whip

IN a promising show of force by a company’s owners, three directors at Texas Industries, a construction materials maker with almost $850 million in sales, got the boot last week. Taking their seats at the boardroom table will be directors nominated by Shamrock Holdings, the money management firm best known for helping to oust Michael Eisner from his perch as chief executive of Disney.

The results of the Oct. 22 election at Texas Industries, disclosed last Tuesday, are an example of what happens when shareholders act appropriately — like the company owners that they are. Equally important, Shamrock executives say they believe their win at the company shows that shareholders are becoming increasingly willing to take on entrenched directors.

Click here to read the entire New York Times article.

Hedge Fund Solutions issued a Catalyst Investment Research(TM) report on Texas Industries (TXI) before their annual meeting. The research examines Shamrock's activist campaign along with a perspective on the Company's potential to generate value. Click here to begin a 30-day free trial and you'll receive a copy of the TXI research.