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To: MythMan who wrote (250890)	7/17/2003 5:59:08 PM
From: yard_man	Read Replies (1) \| Respond to of 436258

you got a ticket for me? <g>

To: MythMan who wrote (250890)	7/17/2003 6:26:59 PM
From: mishedlo	Read Replies (1) \| Respond to of 436258

From Minyanville Corporate Governance is Dead At least in one place Iomega after the close today announced a one time special dividend of $5 per share (the stock closed at $11.40) along with disappointing earnings and job cuts. Why did they do this? The answer I believe lies in the fact that insiders own at least 30% of the company’s shares. Because of the new taxation rules on dividends, the company’s board is essentially distributing $4.25 in after tax value ($5 x .85) to themselves (and to other shareholders) at the expense of the bondholders. Normally bondholders in bankruptcy would have a superior claim over equity shareholders to the assets of the company. This is not the case if the shareholders vote to distribute those assets before bankruptcy. Maybe the company won’t go bankrupt. Maybe there is some good economic reason to this transaction and I am all wet. But if I were a bondholder, I would be getting a very good lawyer right now.