As many people know, Sarbanes Oxley prohibited making loans to top executives. But that doesn’t mean that the loans — in one form or another — have disappeared entirely from the filings. Take Service Acquisition Corp. International (SVI), which disclosed $1.72 million in loan forgiveness and tax gross-up for CEO Paul Clayton in this proxy filed last week. Not familiar with SVI? That’s because it’s one of those shell companies that expects to complete its acquisition of the much better known Jamba Juice by the end of the month. Granted, Jamba Juice was a private company when it made the loan arrangement with Clayton, so the SOX rules didn’t apply.

When SVI first announced the deal back in March, the stock shot up sharply and last week Wedbush Morgan started the stock at a buy. But the $265 million deal seems to be taking a lot longer to complete than initially expected since the merger termination date has now been extended three times. The new date is now Nov. 17. Earlier dates had been Aug. 15 and Sept. 15. What’s the delay? In the past, the company has talked about waiting for Jamba’s fiscal year numbers. But in its report, Wedbush said the biggest risk for investors was the inability to close the deal.

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If you didn’t catch Gretchen Morgenson’s comprehensive take-down of compensation consultant Frederic W. Cook in yesterday’s Times, it’s worth a read.

Posted in My big fat deal, Perk city

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