MONY, AXA MERGER VOTE POSTPONED:

The MONY Group Inc. postponed the shareholder meeting that was to vote on a merger with French insurance company AXA, after a Delaware court decided that the company must explain the deal better to shareholders. The special meeting to vote on the hotly contested deal had been set for Feb. 24. MONY, which is based in New York, is the holding company for subsidiaries that provide financial services like mutual funds and insurance. In his opinion, Vice Chancellor Stephen P. Lamb ruled that the company’s proxy materials need to be supplemented to provide fuller information about executive change-in-control provisions before shareholders could vote on the deal. Under the provisions, executives stand to gain as much as $90 million when the deal closes, a major bone of contention for a group of shareholders contesting the $1.5 billion offer from AXA as inadequate. However, the judge declined to take more drastic action, rejecting most substantive claims in a shareholder lawsuit seeking to nix the upcoming vote.
CHI-CHI’s Parties to mediate: Attorneys for Chi-Chi’s and more than 200 people who claim they were sickened in a hepatitis A outbreak in western Pennsylvania have asked a bankruptcy judge to approve a mediation system to handle major legal claims against the restaurant chain and its insurers. The agreement, which also involves attorneys representing Chi-Chi’s creditors and the restaurant’s primary insurer, Arch Specialty Insurance Group, would set up a 45-day window during which 202 people who have attorneys and plan to sue—and any others who have yet to—would submit their pending lawsuits to nonbinding mediation. Those plaintiffs who can’t settle in mediation would be free to file a lawsuit in an attempt to get damages from Chi-Chi’s and its insurers. Under the mediation system, potential lawsuits settled for $35,000 or less will be paid from $500,000 in self-insurance the restaurant chain has or a $1 million Arch Specialty policy, without further review from the bankruptcy court. Chi-Chi’s will agree to seek the bankruptcy judge’s approval of settlements of more than $35,000. If Chi-Chi’s or its insurer aren’t able or allowed by the bankruptcy court to pay a claim, the plaintiff is free to sue Chi-Chi’s and its insurers for damages.