Manitowoc reached an agreement with Carl Icahn in connection with the planned spinoff of it Cranes and Foodservice businesses into two independent, publicly traded companies.

The board of directors of the company also made commitment to certain governance provisions for Manitowoc and the Foodservice business.  Last month, Manitowoc (MTW) agreed to adopt best practices for the companies in the spun off companies following the completion of the deal.

The board of directors of Manitowoc approved certain corporate governance commitments for the standalone Foodservice entity following the spinoff.

Under the agreement, the Foodservice entity will be incorporated in Delaware. It will have an annual election of the board and no super-majority voting provisions.

Any stockholder rights plan or poison pill adopted by the Foodservice entity will not have a trigger below 20%. If the poison pill is not ratified by shareholders within 135 days of adoption, it will expire automatically.

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The holders of 10% of the outstanding shares of the Foodservice entity will be allowed to call a special meeting of stockholders.

Manitowoc added that its agreement with Icahn provides for certain customary standstill restrictions. The company committed not to reduce the trigger for its shareholder rights plan below 20% for the duration of the standstill agreement.

The agreement includes an option for Icahn to appoint one representative to the board of directors of Manitowoc, and to appoint additional representative on the board of the Foodservice entity after the spinoff.

Shareholders who obtained a majority control of the Foodservice entity will be allowed to remove and replace directors at a special meeting.

If the board of the Foodservice entity rejects an unsolicited offer in favor of another bid and allows the second bidder to conduct diligence, the board must also grant the first bidder to conduct diligence if it increased its offer above second bid.

Icahn agreed to vote in favor of Manitowoc’s nominees for election to the board at the 2015 annual meeting of shareholders.

Commenting on the agreement, Icahn said, “We applaud the ability of Manitowoc’s board of directors and management to recognize the importance of separating the companies as well as the importance of good corporate governance.”

Icahn reiterated his strong conviction that the separation of the core businesses of Manitowoc combined with improved corporate governance will create two stronger companies and enhanced shareholder value.

On the other hand, Manitowoc CEO Glen Tellock said, “We are highly focused on executing our strategic plan, delivering on our goals, and working towards the successful separation of our Cranes and Foodservice businesses.”  The company expects to complete the spinoff in the first quarter of 2016.

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