R2 SEC Filing:
sec.gov
Mr. Carl C. Icahn, the Issuer's majority shareholder and Chairman of the Board, previously attempted to obtain all of the Issuer's income producing assets for himself at the expense of the Issuer's minority shareholders. R2 Investments, LDC ("R2") and other minority shareholders had to sue to stop him. The Reporting Person, on behalf of R2, believes the latest announced preferred stock issuance may be yet another attempt by Mr. Icahn to personally take the Issuer's assets for himself to the detriment of the minority shareholders.
In one fell swoop, the Issuer's "Special Committee of the Board of Directors," all of whose members serve on the board at Mr. Icahn's discretion, are allowing Mr. Icahn to gain control of over 80% of the Issuer's shares on a fully converted basis and obtain access to over $900 million of the Issuer's tax losses to offset his own taxes. Should Mr. Icahn acquire just a few additional shares to raise his ownership percentage to 90% of each class of the Issuer's stock, Mr. Icahn would be able to execute a short-form merger to completely eliminate the ownership rights of all minority shareholders without all of the standard protections provided to minority shareholders in a self-dealing transaction. Despite the extremely dilutive effects and obvious potential conflicts of interest associated with it, the Issuer provided no advance notice of the preferred stock issuance.
Given Mr. Icahn's history of using his majority ownership and board position to benefit himself to the detriment of the minority shareholders, the Reporting Person is concerned about the adequacy of the process and fairness of Mr. Icahn's latest transaction. Accordingly, on August 1, 2008, the Reporting Person, on behalf of R2, sent a letter to the Issuer requesting additional information under Section 220 of the Delaware General Corporation Law regarding the Issuer's new issuance on July 25, 2008 to affiliates of Mr. Icahn of 555,000 shares of 7% Class B Convertible Preferred Stock and 225,000 shares of 9.50% Class C Perpetual Preferred Stock.
A copy of the demand under Section 220 of the Delaware General Corporation Law has been filed as Exhibit 99.1 hereto.
Except as set forth in this Item 4, the Reporting Person has no present plans or proposals that relate to or that would result in any of the actions specified in clauses (a) through (j) of Item 4 of Schedule 13D of the Act.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
Item 7 is hereby amended and restated in its entirety as follows:
99.1 -- Demand under Section 220 of the Delaware General Corporation Law.
After reasonable inquiry and to the best of the undersigned's knowledge and belief, the undersigned certifies that the information set forth in this statement is true, complete and correct.
DATED: August 6, 2008 |
