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Message: Re: Alternative early warning report- longterm-Proxy Voting 101
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Dec 11, 2009 08:52PM

>There are four categories of votes: For, Against, Abstain, and Not Voted

Actually this doesnt apply in our case. Notice that on the voting form, the options for directors are "FOR" and "WITHHOLD". There is no "AGAINST" option.

So how do you vote NO to the directors? I don't think we can.

This type of voting is called "Plurality voting"

Plurality voting

Canadian corporate statutes generally provide that shareholders of a corporation elect directors annually by ordinary resolution (being a resolution passed by a majority of the votes cast by the shareholders who voted on the resolution). Corporations whose shares have been distributed to the public are generally required to solicit proxies from the shareholders in connection with their shareholders’ meetings. Canadian corporate and securities regulations generally require that the form of proxy provided to shareholders indicate whether the shares are to be VOTED or WITHHELD from voting in respect of the election of directors (and not voted FOR or AGAINST any particular candidate). As a result, the directors of a Canadian corporation who receive the most votes (i.e. a plurality of the votes) will be elected. In the normal circumstances where the number of candidates for election does not exceed the number of directors to be elected (as fixed by the board or the shareholders), then each director who receives at least one vote is assured a plurality of the votes. The situation is different if shareholders have nominated competing nominees (candidates other than those nominated by management) which requires shareholders to solicit proxies. In that case, those nominees with the most votes would be elected.

The plurality voting system was adopted in order to avoid the consequences of failed elections (i.e. an election of less than a full board). The plurality voting model is the voting standard under Canadian corporate statutes. The principal concern with the plurality voting standard is that it enables management’s nominees to be elected even if a majority of shareholders withhold votes in respect of an election.

http://www.mondaq.com/canada/article.asp?articleid=39312


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Dec 12, 2009 04:57PM
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