Plan Proposal Roundup – Week of 9/7/2009
Looking at the proxy statements that were filed last week (9/7/2009), here are the new plans and amendments that I found (Company, plan name, (date proxy filed) and [share request as a percent of Common Shares Outstanding as of the record date/disclosed in the proxy or 10-K or latest 10-Q]):
New Equity Compensation Plan Proposals
- Avalon Holdings Corp., 2009 Long-Term Incentive Plan (9/9/2009), 34.2%
- Phazar Corp., 2009 Equity Incentive Plan (9/10/2009), 11.9%
- Secure America Acquisition Corp., 2009 Stock incentive Plan (9/9/2009), 9.6%
- Stone Tan China Acquisition Corp., 2009 Incentive Plan (9/8/2009), 6.1%
- Sysco Corp., 2009 Non-Employee Directors Stock Plan (9/11/2009), 0.1%
- Winn Dixie Stores Inc., 2010 Equity Incentive Plan (9/8/2009), 11.2%
New Equity Compensation Plan Amendment Proposals
- Angidynamics Inc., 2004 Stock and Incentive Award Plan (9/9/2009), 3.1%
- Arcadia Resources, Inc., 2006 Equity Incentive Plan (9/9/2009), 6.1%
- Access Integrated Technologies, Inc., 2000 Equity Incentive Plan (9/11/2009), 4.6%
- Blue Coat Systems Inc., 2007 Stock Incentive Plan (9/8/2009), 5.0%
- Brigham Exploration Co., 1997 Incentive Plan (9/9/2009), 12.0%
- Concurrent Computer Corp., 2001 Stock Option Plan (9/11/2009), 6.0%
- Cowen Group, Inc., 2007 Equity and Incentive Plan (9/10/2009), 7% of post-transaction CSO
- Gulfstream International Group Inc., Stock Incentive Plan (9/9/2009), 10.1%
- Matrix Service Co., 2004 Stock Incentive Plan (9/11/2009), 4.2%
- Noble Corp., 1991 Stock Option and Restricted Stock Plan (9/11/2009), 1.4%
- Oragenics Inc., 2002 Stock Option and Incentive Plan (9/10/2009), 8.3%
- SCM Microsystems Inc., 2007 Stock Option Plan (9/10/2009), 8.0%
- Sysco Corp., 2007 Stock Incentive Plan (9/11/2009), 4.2%
Some interesting items from these plan proposals:
- At least two of the plans (1 new and 1 amendment) use a flexible share authorization; the amended plan is seeking to change the Full Value Award Count from 1.5 shares to 1.25 shares (their stock options are now worth more relative to their stock price than when the plan was first put in place);
- Several of the proposals were on proxies that also had proposals that would impact the share proposal in some way, e.g., proposals to increase the total number of authorized common shares. A number of these proposals explained the implications for the plan proposal if these other proposal(s) were and were not approved;
- At least one of the plans uses an evergreen type provision so that the share authorization is equal to the lesser of (i) a fixed number, or (ii) a percent of the common shares outstanding at any time;
- A couple of these companies had multiple classes of stock, and the second class of stock typically had a higher number of votes per share. Therefore on a vote dilution basis, the dilution from some of the above proposals would be lower;
- At least one amendment including adding Fidelity requirements, e.g., the 5% of the plan’s shares carve-out pool to permit awards to be granted not in compliance with the Fidelity requirements;
- One of the proposals included a rolling 3-year burn rate limit of 1.5%. Most likely this was needed it in order to overcome RiskMetrics Group’s Burn Rate policy which would have otherwise caused a negative RMG vote recommendation against the proposal.
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