Feeds

Yahoo! shareholders call for Icahn preemption

Another kick to Yang's fiduciaries

The Essential Guide to IT Transformation

Carl Icahn wants to replace Yahoo!'s board of directors so he can vaporize its employee retention plan and sell the company to Microsoft. But some litigious Yahoo! shareholders think he's got it slightly wrong.

In their ongoing lawsuit against Jerry Yang and company, two share-holding Detroit pension funds have argued that Yahoo!'s much-discussed severance package isn't just an impediment to a Microsoft merger. It's also an impediment, they say, to a Carl Icahn takeover.

Yahoo!'s severance package kicks in if two conditions are fulfilled. One: Control of Yahoo! changes hands. And two: an employee is fired or quits with "good reason."

In court papers filed late Monday with the Delware Court of the Chancery, the Police & Fire Retirement System of the City of Detroit and the General Retirement System of the City of Detroit insist that Condition Number One would be fulfilled if Icahn succeeds in replacing Yahoo!'s board of directors.

"If Icahn’s slate prevails, Yahoo shareholders will be funding huge cash severance and equity acceleration over the following two years for every employee who is either terminated or who resigns with 'good reason' as that phrase is loosely defined in the Severance Plans," the filing reads. "This discriminatory application of the Severance Plans coerces the stockholder vote."

In other words, it would prevent people from voting for Icahn's slate - and prevent a Microsoft merger. And all these pensions funds want is a Microsoft merger. Their suit clams that Yahoo!'s rejection of that $44.6bn Microsoft bid - and subsequent higher bids - was a "breach of fiduciary duties."

So, the Detroiters have called for a trial date before Yahoo!'s August 1 shareholders. And they've called on the court to vaporize the severance package. ®

Build a business case: developing custom apps

More from The Register

next story
Arrr: Freetard-bothering Digital Economy Act tied up, thrown in the hold
Ministry of Fun confirms: Yes, we're busy doing nothing
Help yourself to anyone's photos FOR FREE, suggests UK.gov
Copyright law reforms will keep m'learned friends busy
Apple smacked with privacy sueball over Location Services
Class action launched on behalf of 100 million iPhone owners
US judge: YES, cops or feds so can slurp an ENTIRE Gmail account
Crooks don't have folders labelled 'drug records', opines NY beak
ONE EMAIL costs mining company $300 MEEELION
Environmental activist walks free after hoax sent share price over a cliff
UK government officially adopts Open Document Format
Microsoft insurgency fails, earns snarky remark from UK digital services head
You! Pirate! Stop pirating, or we shall admonish you politely. Repeatedly, if necessary
And we shall go about telling people you smell. No, not really
prev story

Whitepapers

Designing a Defense for Mobile Applications
Learn about the various considerations for defending mobile applications - from the application architecture itself to the myriad testing technologies.
Implementing global e-invoicing with guaranteed legal certainty
Explaining the role local tax compliance plays in successful supply chain management and e-business and how leading global brands are addressing this.
Top 8 considerations to enable and simplify mobility
In this whitepaper learn how to successfully add mobile capabilities simply and cost effectively.
Seven Steps to Software Security
Seven practical steps you can begin to take today to secure your applications and prevent the damages a successful cyber-attack can cause.
Boost IT visibility and business value
How building a great service catalog relieves pressure points and demonstrates the value of IT service management.