Just when you thought the last Wall Street lawyer with a sense of humor had moved to Florida, this little tidbit from the recent 13D filing on The First American Corporation. Someone over at Highfields Capital has too much time on their hands. Though, I suppose it is possible they aren't being funny intentionally. Still, read the passage below out loud and tell me that the use of "SpinCo" isn't a bit of fun at the expense of First American's management (after the jump).
In addition, if the Issuer effects the planned spin-off (the “Planned Transaction”) of certain of its assets into a separate public company (“SpinCo”) prior to December 31, 2009, the Issuer has agreed to appoint directors nominated by the Highfields Support Agreement Parties (the “SpinCo Directors”) to the board of directors of SpinCo representing 30 percent of the total members of such board of directors, but, in any event, not fewer than three directors. The Issuer has also agreed that SpinCo shall nominate the SpinCo Directors at any meeting of shareholders where directors are to be elected held during the period beginning on April 10, 2008 and ending on the earliest to occur of (a) December 31, 2009 or (b) any date within the four months preceding any annual meeting of SpinCo’s shareholders on which the Highfields Support Agreement Parties shall fail to collectively own at least 5 percent of SpinCo’s outstanding shares of common stock (the “SpinCo Nomination Period”), and that SpinCo will use its reasonable best efforts to cause the election of the SpinCo Directors at any such meeting. The Issuer also agreed that, at all times during the SpinCo Nomination Period, a number of SpinCo Directors equal to 30 percent of the total number of members of SpinCo’s board of directors (rounded to the nearest whole number of SpinCo Directors, but, in any event, not fewer than three) shall serve on SpinCo’s board of directors. As part of the Planned Transaction, the Issuer agreed that SpinCo will become a party to the Agreement.
The First American Corporation [EDGAR]