Tag Archives: Delaware Chancery Court

Business, Finance, Occupation & Industry

OTK Associates Obtains Delay of Morgans Hotel Group's Rights Offering

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By Business Wirevia The Motley Fool

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OTK Associates Obtains Delay of Morgans Hotel Group’s Rights Offering

NEW YORK–(BUSINESS WIRE)– OTK Associates LLC, the largest stockholder of Morgans Hotel Group Co. (NAS: MHGC) with 13.9% of the outstanding common stock of the company, today commented on the postponement of Morgans’ recently announced rights offering and recapitalization plan pending a hearing for a preliminary injunction in Delaware Chancery Court. The hearing is expected to be scheduled before May 15, 2013.

OTK is pleased that the Morgans Hotel Group agreed to delay the rights offering, as OTK had requested in its motion for a temporary restraining order. All shareholders should be deeply troubled by the current board of directors’ continued waste of corporate assets to advocate for a coercive and dilutive transaction that OTK believes is invalid. Further, the use of company funds to change sharehholder voting rules and diminish voting rights calls into question this board’s fiduciary duties and responsibilities.

OTK looks forward to presenting to the Delaware Chancery Court its case that the company’s recapitalization plan is invalid under Delaware law and requesting that the court invalidate the board’s decision to retroactively postpone the 2013 annual meeting and reset the corresponding record date.

IMPORTANT INFORMATION

STOCKHOLDERS ARE ADVISED TO READ THE PROXY STATEMENT AND OTHER DOCUMENTS RELATED TO SOLICITATION OF PROXIES BY OTK ASSOCIATES, LLC AND ITS AFFILIATES FROM THE STOCKHOLDERS OF MORGANS HOTEL GROUP CO. FOR USE AT THE 2013 ANNUAL MEETING OF MORGANS HOTEL GROUP CO. WHEN THEY ARE AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. WHEN COMPLETED, SUCH MATERIALS WILL, ALONG WITH OTHER RELEVANT DOCUMENTS, BE AVAILABLE AT NO CHARGE AT THE SECURITIES AND EXCHANGE COMMISSION’S WEBSITE AT HTTP://WWW.SEC.GOV OR BY CONTACTING THE PARTICIPANTS’ PROXY SOLICITOR, OKAPI PARTNERS, TOLL FREE AT (877) 869-0171, OR BY EMAIL TO INFO@OKAPIPARTNERS.COM.

INFORMATION RELATING TO THE POTENTIAL PARTICIPANTS IN A POTENTIAL PROXY SOLICITATION IS CONTAINED IN EXHIBIT 1 TO THE SCHEDULE 14A FILED PURSUANT TO RULE 14A-12 FILED WITH THE SECURITIES AND EXCHANGE COMMISSION BY OTK ASSOCIATES, LLC ON APRIL 8, 2013, AS IT MAY BE AMENDED FROM TIME TO TIME. THE SCHEDULE 14A AND ANY AMENDMENTS ARE AVAILABLE AT NO CHARGE ON THE SECURITIES AND EXCHANGE COMMISSION’S WEBSITE AT HTTP://WWW.SEC.GOV.

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Source: FULL ARTICLE at DailyFinance

Business, Finance, Occupation & Industry

OTK Associates Files a Motion to Join Derivative Lawsuit Against Morgans Hotel Group

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By Business Wirevia The Motley Fool

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OTK Associates Files a Motion to Join Derivative Lawsuit Against Morgans Hotel Group

Alleges that Company’s Recapitalization Plan is Invalid Under Delaware Law and Board Actions Disenfranchise Stockholders and Entrench Management

NEW YORK–(BUSINESS WIRE)– OTK Associates LLC, the largest stockholder of Morgans Hotel Group Co. (NAS: MHGC) with 13.9% of the outstanding common stock of the company, today disclosed that it has filed a motion to join a derivative lawsuit filed in Delaware Chancery Court to stop a self-serving recapitalization that the company is rushing to consummate in advance of a stockholder meeting initially scheduled for May 15, 2013.

OTK Associates also issued the following letter to MHGC stockholders:

April 5, 2013

Dear Fellow Stockholders,

We are writing to inform you that we have filed a motion to join the recently filed derivative lawsuit against Morgans Hotel Group that seeks to stop a series of transactions with the Yucaipa Companies which the company’s directors are rushing to consummate. The board’s actions are invalid under applicable Delaware law, and will further disenfranchise stockholders while thoroughly entrenching the current board and management.

As the company’s largest stockholder, we are deeply concerned by actions of this nature deliberately undertaken during an ongoing proxy process. The board’s move to effectuate a coercively dilutive recapitalization is an obvious attempt to place a large block of stock in friendly hands prior to the annual meeting in order to preserve the positions of its incumbent directors and avoid review of the transaction by a truly independent board.

Similarly, the board’s retroactive decision to postpone the previously scheduled annual meeting to July 10, 2013 from May 15, 2013, and to reset the meeting’s record date to May 29, 2013 from March 22, 2013, serves only to ensure stockholders will be denied the benefit of reviewing the transaction. Existing stockholders of record will effectively lose their right to cast votes at the May 15th meeting, where we believe the company’s incumbent directors would likely be replaced by OTK‘s proposed nominees. This attempt to both rig an election and defend a self-dealing transaction will further burn the funds of a company already operating at a loss.

To preserve stockholders’ rights and the integrity of the corporate decision-making process we are seeking the following:

News, Politics, Government

Fat Lady Still Not Singing In the Sprint Acquisition of Clearwire

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By Joan Lappin, Contributor Sprint may have thought they could steal the shares of Clearwire they don’t already own for a song but no matter what they try, they cannot suppress the true value of the spectrum Clearwire controls. DISH’s Charlie Ergen offered to buy the entire company on 12/8/13 or to do a deal to use its wireless services in exchange for badly needed financing, or to buy up to 24% of its excess spectrum. Sprint is trying its best to block and parry. Stay tuned as the price rises for Clearwire’s assets and large shareholder Crest Financial goes to Delaware Chancery Court to plead for expedited review of its case against Sprint.
Source: FULL ARTICLE at Forbes Latest