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Message: Re: Shareholder Activism
1
Dec 10, 2009 09:40PM

Another one:

http://currents.westlawbusiness.com/Articles/2009/10/20091013_0016.aspx?src=WBSignon

As background, the relative ease with which activist shareholders can requisition a shareholder meeting in Canada (and thus challenge an incumbent Board) comes with a speed and ferocity that can render an unprepared company dead on arrival. Consequently, Boards faced with a potential proxy battle should be familiar with the rules of the ring. The typical intent in such a battle is to replace one or more of the incumbent Directors with nominees of the dissident(s).

Directors are typically elected to the Board of a Canadian company at an annual meeting of shareholders, or at a special meeting. Under Canadian corporate law, shareholders holding in aggregate five percent of the outstanding shares of a company may requisition the Directors of that company to hold a special meeting of shareholders. The situations in which a Board can refuse to comply are limited. If the Board fails to call the meeting within 21 days of receipt of a requisition, the dissidents may either call it themselves, or seek a court order requiring the Board to do so. In practice, then, dissident shareholders can have a shareholder vote on the future of a company in just two to three months.

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