Stilwell Group Required to Obtain Insurance Department Approval for Proxy Solicitation
June 05 2006 - 8:15AM
Business Wire
SCPIE Holdings Inc. (NYSE:SKP) announced today that the Delaware
Department of Insurance has notified the Stilwell Group that the
holding of proxies with respect to more than 10% of the Company's
common stock by the Stilwell Group requires the Department's
approval, which the Stilwell Group has not attempted to obtain.
While SCPIE is studying the implications of the Department's
decision, it understands this determination to mean that, if the
Stilwell Group does not obtain such approval prior to the Company's
upcoming annual meeting (or otherwise overturn the Department's
decision), some or all of the proxies it may obtain pursuant to its
pending solicitation may not be authorized to be voted at the
annual meeting. SCPIE further understands that the Department's
approval process involves a minimum of one month (and typically
involves two to three months) of consideration, suggesting that in
SCPIE's view it is highly unlikely that the Stilwell Group could
possibly secure such approval by SCPIE's scheduled June 22, 2006,
stockholders' meeting date. A copy of the full text of the
Department's letter follows: -0- *T Department of Insurance Matthew
Denn (Seal of Delaware 841 Silver Lake Blvd. Insurance Commissioner
Insurance Dover, DE 19904-2465 Commissioner) (302) 674-7300 (302)
739-5280 fax June 2, 2006 Kenneth B. Schnoll Sonnenschein Nath
& Rosenthal 685 Market Street, 6th Floor San Francisco, CA
94105-4207 Re: Disclaimer of Control - American Healthcare
Indemnity Company Dear Mr. Schnoll: The Department has reviewed
your request for a Disclaimer of Control regarding American
Healthcare Indemnity Company. In the Disclaimer Stilwell Value
Partners III, L.P., Stilwell Value LLC, Joseph Stilwell, Spencer L.
Schneider, Gregory Noonan (Jointly referred to herein as
"Stilwell") states that they are seeking to elect individuals to
fill three positions to the Board of Directors of SCPIE. The
Disclaimer also states that, it will, for a limited time and
purpose, hold proxies to vote more than 10% of the outstanding
shares of SCPIE in favor of its three nominees for election to the
twelve-person Board. Delaware code 5001 (3) defines control as
follows: (3) "Control." The term "control" (including the terms
"controlling", "controlled by" and "under common control with")
means the possession, direct or indirect, of the power to direct or
cause the direction of the management and policies of a person,
whether through the ownership of voting securities, by contract
other than a commercial contract for goods or non-management
services, or otherwise, unless the power is the result of' an
official position with or corporate office held by the person.
Control shall be presumed to exist if any person, directly or
indirectly, owns, controls, holds with the power to vote, or holds
proxies representing, 10 percent or more of the voting securities
of any other person. This presumption may be rebutted by a showing
made in the manner provided by section 5004(k) of this title that
control does not exist in fact. The Commissioner may determine,
after furnishing all persons in interest notice and opportunity to
be heard and making specific findings of fact to support such
determination, that control exists in fact, notwithstanding the
absence of a presumption to that effect. Since Stilwell states it
will hold proxies to vote of more than 10% of the outstanding
shares of SCPIE, the Department interprets this as Stilwell having
control per the above definition. Therefore the Department believes
that Stilwell must file a Form A as required per section 5003 of
the Delaware Code. If you have any questions or concerns please
feel free to contact me at (302) 674-7330. Sincerely, /s/ Darryl
Reese, CFE, CIE, CFE Director of Company Regulation Cc: Glenn C.
Kenton, Richards, Layton & Finger *T About SCPIE Holdings SCPIE
Holdings Inc. is a leading provider of healthcare liability
insurance for physicians, oral and maxillofacial surgeons, and
other healthcare providers, as well as medical groups and
healthcare facilities. Since the company was founded in 1976, it
has carved out a significant niche in the insurance industry by
providing innovative products and services specifically for the
healthcare community. Important Additional Information Filed with
the SEC On May 8, 2006, SCPIE filed a definitive proxy statement
with the SEC and mailed it to SCPIE's stockholders. WE URGE
INVESTORS TO READ THE PROXY STATEMENT AND ANY OTHER RELEVANT
DOCUMENTS THAT SCPIE HAS FILED WITH THE SEC BECAUSE THEY CONTAIN
IMPORTANT INFORMATION. Security holders are able to obtain a free
copy of the proxy statement and other related documents filed by
SCPIE at the SEC's website at www.sec.gov. SCPIE's proxy statement
and other related documents may also be obtained from SCPIE free of
charge by contacting SCPIE's Communications Department at (310)
551-5942. LISTING OF PERSONS WHO MAY BE DEEMED "PARTICIPANTS" IN
THE SOLICITATION AND CERTAIN INFORMATION CONCERNING SUCH PERSONS IS
SET FORTH IN THE DEFINITIVE PROXY STATEMENT FILED WITH THE SEC ON
MAY 8, 2006, WHICH MAY BE OBTAINED THROUGH THE WEB SITE MAINTAINED
BY THE SEC AT www.sec.gov. SINCE SUCH DATE, WILLIAM A. RENERT, M.D.
SOLD 1,895 SHARES OF SCPIE'S COMMON STOCK ON MAY 12, 2006.
Forward-Looking Statements In addition to historical information,
this news release contains forward-looking statements that are
based upon the SCPIE's estimates and expectations concerning future
events and are subject to certain risks and uncertainties that
could cause actual results to differ materially from those
reflected in the forward-looking statements. Forward-looking
statements include statements herein regarding SCPIE's upcoming
annual meeting of stockholders. In light of the significant
uncertainties inherent in the forward-looking information herein,
the inclusion of such information should not be regarded as a
representation by SCPIE or any other person that SCPIE's objectives
or plans will be realized.
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