Liberty agree to board rules ahead of trial
EmptyIAC/InterActiveCorp. (IACI.O: Quote, Profile, Research) and its controlling shareholder, Liberty Media Corp. (LCAPA.O: Quote, Profile, Research) (LINTA.O: Quote, Profile, Research), have reached an arrangement on how IAC's board can operate ahead of a March trial over a proposed company restructuring, according to legal documents submitted on Wednesday.
Under a status quo order, the two sides agreed that IAC's board will remain intact, but must notify Liberty five business days in advance of any non-routine actions it takes for the company.
Under the order, IAC could not authorize a spin-off or split-off of assets or lines of business, a stock split that would affect the company's assets or securities, or the sales of $50 million worth of assets without notifying Liberty.
Other non-routine actions that would require the IAC board to notify Liberty include increasing compensation or benefits for current officers or employees, or hiring new officers or employees whose salaries are more than $300,000.
IAC also is barred from further negotiations with investment bankers, financial advisers or other third parties regarding the proposed spin-offs without notifying Liberty.
The companies have been working on the status quo order since Liberty sued to oust Chairman Barry Diller and six directors from the IAC board on Jan. 28.
IAC and Liberty (LINTA.O: Quote, Profile, Research) have filed dueling lawsuits over a plan to spin out four of IAC's largest businesses. The three cases -- two filed by Liberty and one by IAC -- are set for trial in Delaware Chancery Court before Judge Stephen Lamb.
The lawsuits were filed in quick succession last month as part of a quickly escalating dispute between Diller and Liberty Chairman John Malone. (Reporting by Michele Gershberg and Gina Keating in Los Angeles, editing by Gerald E. McCormick)