DRUMMONDVILLE, Que. – The second-largest shareholder in CVTech Group Inc. (TSX:CVT) wants the company to postpone its annual and special meeting on Wednesday, saying the online proxy voting process has been subject to errors and malfunctions.
Major shareholder Gestion G. Aubert Ltee said Monday that it has come to light that a number of votes have been wrongly cast while some shareholders may have been unable to vote their proxies at all.
“It appears that a number of shareholders are disenfranchised and have been deprived of their most basic right to elect a board of their choice,” said Guy Aubert, who controls Victoriaville, Que.,-based Gestion G. Aubert Ltee.
“Basic respect for the nature of the corporate democracy dictates that CVTech postpone the annual meeting to allow all shareholders to vote their conscience,” Aubert said.
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This problem, which lasted for seven of the 14 days of the active proxy solicitation period, was resolved on May 23 but another malfunction occurred Saturday and was resolved several hours later, Aubert said.
Aubert, who was chief operating officer of CVTech until his retirement from that position in 2010, currently owns nearly 10 million shares or 13.8 per cent of CVTech’s outstanding stock – making him its second-largest shareholder.
In a May 14 regulatory filing, Aubert said there needed to be a change of leadership at the company due to a decline in its market value since 2005, when he received shares as partial payment for his ownership stake in Thiro Ltd.
Gestion G. Aubert Ltee has nominated seven directors, including Guy Aubert who is already a director, to CVTech’s board with the aim of rejuvenating the company.
Proxy advisory firm Glass Lewis has said there is merit in some of Aubert’s arguments, but that the company’s shortcomings don’t warrant a sweeping change of the board.
“We find even less impetus for such turmoil considering that the dissenting shareholder has, himself, been positioned for nearly seven years to directly influence, through his extensive board and executive service and significant shareholding, virtually every issue subject to his critique,” Glass Lewis has said.
It adds that the incumbent board also supports Aubert’s re-election as director, giving him continued influence on the company’s strategic direction.
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