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Next Week’s Requirements for Dell Appraisal Rights
Immediate priorities for reserving appraisal rights
Provisions for “Review Panel” support of participating investors
Rumor of the week
This holiday week has set the stage for final decision-making in the
proposed Dell buyout. While observing the poker plays, shareholders
should of course be prepared to choose their own best options.
Immediate priorities for reserving appraisal rights
For any investor who thinks there is any chance of wanting to secure
the option of appraisal rights, it is important to immediately
initiate the process of delivering the required written demand letter.
This seemingly simple administrative task commonly takes about ten
business days: a beneficial shareholder has to instruct its custodian
to get an authorized person to deliver an executed form to the
Depository Trust Company, which in turn prepares a form of letter that
is returned to the custodian for delivery to Dell. If that process is
not completed prior to July 18, you will not be entitled to appraisal
rights.
Remember that if you get the demand letter delivered by the deadline,
you can easily cancel the demand for appraisal by either voting in
favor of the proposed transaction or withdrawing the demand at any
time up to 60 days after the closing of a transaction. But if you fail
to get the demand letter delivered, you will not have this choice.
It should be noted that today was the last day the Dell Valuation
Trust was accepting responsibility for processing appraisal demands,
other than by approval of exceptions, and that independently processed
demands will require review by the Trust’s attorneys to be eligible
for Trust support.
Provisions for “Review Panel” support of participating investors
To accommodate investor requirements of both being informed and being
heard in an appraisal process that was designed before the development
of SEC reporting regulations, we have been developing plans for a
“Review Panel” as a key element of the Dell Valuation Trust.
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Members:
Any holder or group of holders of 1% of eligible appraisal rights
supported by the Trust will be able to delegate a legal or valuation
expert to serve on the Panel.
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Staffing:
The Trust will provide staffing and administrative support for all
required reporting, research, meeting and other functions of the
Panel.
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Monitoring and access:
Members of the Panel will meet with counsel for the appraisal
process monthly and as developments require to review the progress
of the proceedings and any issues that concern investors, and will
have access to confidential information (subject to their acceptance
of a conventional confidentiality agreement).
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Offering views:
Members will be expected to offer views for consideration of
appraisal counsel and other Members of the Panel, but will not be
responsible for actions of the Trust or appraisal counsel.
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Research:
The Panel will be able to request research relating to the interests
of appraisal rights holders, including surveys of holder interests.
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Reporting:
Reports will be prepared quarterly and in relation to specific
developments the Panel considers worth addressing, and each Member
may provide individual comments to be included with the reports.
(The reports will of course be reviewed to assure that they do not
include any disclosures of confidential information that could make
a recipient an “insider.”)
Your suggestions or comments will be welcomed to refine these
provisions during the next week.
Rumor of the week
This past week’s most interesting Forum-related rumor was from
institutional investors reporting they had heard that I reported they
were participating in the appraisal rights project.
For those of you who may not know, publicly posted Forum policies do
not allow the identification of any participant without specific
permission. Also, the stated conditions of Dell Valuation Trust
services restrict disclosures to the requirements of private
arrangements. Be assured that I have not violated these policies or
any other privacy commitment. You can therefore assume that someone
who tells you that I have disclosed something private has either been
misled or is doing the misleading. And you should ask yourself why.
The most likely explanation of this week’s misleading statements is
that somebody is trying to trick investors into disclosing whether
they plan to vote against the buyout as required to secure appraisal
rights. Viewing it positively, this level of effort at intelligence
gathering should encourage your reliance on the buyout’s proponents to
know whether the number of shares demanding appraisal rights is
reaching a level that threatens approval of the transaction.
The poker players among you will then be able to read the signals to
play your hands.
GL – July 5, 2013
Gary Lutin
Chairman, The Shareholder Forum
575 Madison Avenue, New York, New York 10022
Tel: 212-605-0335
Email:
gl@shareholderforum.com |