On October 8, 2010, the Court of Chancery of Delaware issued an important opinion, Airgas, Inc. v. Air Products & Chemicals, Inc. (Del. Ch. Oct. 8, 2010), with significant implications for public corporations with staggered boards. The decision arose out of the ongoing takeover battle by Air Products for control of Airgas, Inc. At Airgas’s 2010 annual meeting, held last September 15, Air Products successfully obtained all three board seats that were up for election on Airgas’s nine-member staggered board. In addition, holders of 45.8% of the shares entitled to vote at the annual meeting approved a bylaw amendment, proposed by Air Products, which would cause Airgas’s annual meeting to be held each year in the month of January as opposed to August, when Airgas’s annual meetings had historically been held. Adoption of the proposed bylaw means that Airgas’s 2011 annual meeting will take place barely four months after Airgas’s 2010 annual meeting was held, and Air Products will have the opportunity to replace a majority of Airgas’s staggered board in the space of four months. Airgas filed suit and moved to declare the bylaw amendment invalid.
Topic: Corporate Governance
Dodd-Frank’s “Say-on-Pay” Provisions
Orange County of counsel David C. Lee and associate Brian D. O’Neill are the authors of "Dodd-Frank’s ‘Say-on-Pay’ Provisions" [PDF] published in the October 2010 issue of Insights.
Proxy Access Litigation and Next Steps
The following provides an update on the litigation challenging the “proxy access” rules adopted by the Securities and Exchange Commission (“SEC” or “Commission”), and also discusses steps companies should consider during the pendency of the litigation. Our client alert dated August 25, 2010, available here, provided an overview of the proxy access rules.
Delaware Court of Chancery Issues Important Poison Pill Opinion
New York partner Eduardo Gallardo and associate Sharon I. Grysman are the authors of "Delaware Court of Chancery Issues Important Poison Pill Opinion" [PDF] published in the October 2010 issue of Insights.
Executive Compensation, Corporate Governance and Other Securities Disclosure Provisions in the Dodd-Frank U.S. Financial Regulatory Act
Washington, D.C. partners Amy Goodman, Ronald Mueller and Elizabeth Ising are the authors of "Executive Compensation, Corporate Governance and Other Securities Disclosure Provisions in the Dodd-Frank U.S. Financial Regulatory Reform Act" [PDF] published in BNA’s Securites Regulation & Law on September 20, 2010.
Webcast – Implementing the Dodd-Frank Wall Street Reform and Consumer Protection Act
On July 21, 2010, President Barack Obama signed into law the Dodd-Frank Wall Street Reform and Consumer Protection Act, the most sweeping financial reform legislation in over a generation. Gibson Dunn panelists discuss the regulatory initiatives in the bill that are likely to be of interest and concern to the wide range of companies affected by the bill.
U.S. SEC Adopts Final Rules on Proxy Access
Today the U.S. Securities and Exchange Commission ("SEC") adopted amendments to its proxy rules to permit shareholders to include their director candidates in a company’s proxy materials–commonly referred to as "proxy access." The vote on the amendments was 3-2, with Commissioners Casey and Paredes dissenting due to numerous concerns, including that the proxy access rules encroach on state corporate law and interfere with private ordering by companies and their shareholders.
Delaware Court of Chancery Issues Important Poison Pill Opinion
On August 11, 2010, the Delaware Court of Chancery issued an important opinion in the area of stockholder rights plans, or poison pills. Vice Chancellor Strine’s opinion in Yucaipa American Alliance Fund II, L.P. v. Riggio et al., 2010 WL 3170806 (Del. Ch. Aug. 11, 2010), reaffirms Delaware’s traditional deference to a board’s well-informed and well-reasoned implementation of antitakeover measures, and gives meaningful guidance to boards and their advisors in the implementation of poison pills and other defensive measures in the face of a potential unsolicited change in control situation.
SEC Chairman Schapiro Announces Process for Commenting in Advance on Dodd-Frank Rulemaking
On July 27, 2010, U.S. Securities and Exchange Commission ("SEC") Chairman Mary L. Schapiro announced that the SEC is implementing a new process designed to make it easier for the public to provide comments as the SEC undertakes the process of adopting rules required under the Dodd-Frank Wall Street Reform and Consumer Protection Act (the "Act"), which President Obama signed into law last week. The SEC established the new process in order to provide expanded opportunity for public comment and greater transparency and accountability.
U.S. Regulatory Reform Heads to the Implementation Phase
Dodd-Frank Wall Street Reform and Consumer Protection Act Signed by the President
On July 21, 2010, President Barack Obama signed into law the Dodd-Frank Wall Street Reform and Consumer Protection Act, the most sweeping financial reform legislation in over a generation. The law was largely the product of public consternation and anxiety following the 2008 financial crisis and subsequent recession. The signing of the bill does not, however, mark the end of the process for this round of financial reform and regulation. Despite the President’s comments yesterday that the new law "provides certainty to everybody, from bankers to farmers to business owners to customers," the reality is that Dodd-Frank leaves to regulators the task of conducting pivotal studies, defining core terms, and drafting comprehensive rules, regulations and exceptions that will answer many central and currently open questions raised by the legislation. And so, short of reaching our destination, we have just embarked on the second leg of a long journey.