Shareholders of Forzani Group Ltd. rebuffed the attempts of a dissident
investor to get two directors elected to its board of directors. U.S.
hedge fund Crescendo Partners, which controls about 5% of Forzani's
shares, had pushed for the election of Barry Erdos, the CEO of FAO
Schwarz, and David Sgro, a managing director at the fund. While the
slate of eight directors put forward by Forzani received about 27
million votes each, Sgro got about four million and Erdos received 10
million votes.
The vote took place at the company's annual meeting in Calgary. All eight FGL nominees were approved.
“We thank our shareholders for their support in this vote and
throughout the proxy contest,” said John Forzani, FGL's Chairman, in a
statement. “The vote today demonstrates the confidence that FGL
shareholders have in our Board, our governance, our strategy and our
performance.”
“Looking ahead, FGL's Board and management will continue to focus on
executing on the plan outlined at the Company's Investor Day
presentation in April, in order to create value for all shareholders
through profitable growth.”
“We welcome Don Gass to the Board as a new independent director,” said
the chairman. “Mr. Gass will be a member of the Audit Committee where
he will replace Bill Grace, who has retired. We would also like to
thank Bill Grace for his very valuable contributions over 15 years of
service to FGL and its Board,” said Mr. Forzani.
In its own statement, Crescendo Partners said that allthough its
representatives were not elected to the board, it received positive
support for its efforts from approximately 38% of the Forzani
shareholders represented at the annual meeting. Excluding votes
received from members of the board and management and the company's
largest shareholder, Letko, Brosseau & Associates Inc., which
expressed its support for management early in the process, Crescendo
received support from approximately 48% of the voting shareholders.
Eric Rosenfeld, managing member of Crescendo Partners stated, “We have
received a tremendous endorsement of our campaign as evidenced by the
substantial support we've received from shareholders. Our objective is
to make sure that Forzani effectively executes the strategies necessary
to surface the full value of its business. As a result of our past and
future actions, we expect that there will be positive change at
Forzani.”
As at the May 4, 2009 record date, FGL had 30.5 million shares eligible
to vote. Based on preliminary information, approximately 28.0 million
shares were voted, representing 92% of the eligible shares. Following
is the preliminary vote count for individual nominees, as compiled by
scrutineer Computershare Trust Company of Canada:
—————————————————————————-
Name Votes % of votes cast Outcome
(millions)
—————————————————————————-
John Forzani (FGL) 27.8 99% elected
—————————————————————————-
Al Bellstedt (FGL) 27.8 99% elected
—————————————————————————-
Bob Sartor (FGL) 27.8 99% elected
—————————————————————————-
Jay Peters (FGL) 27.8 99% elected
—————————————————————————-
Paul Walters (FGL) 27.8 99% elected
—————————————————————————-
Roman Doroniuk (FGL) 27.8 99% elected
—————————————————————————-
Henri Drouin (FGL) 17.2 61% elected
—————————————————————————-
Donald Gass (FGL) 17.1 61% elected
—————————————————————————-
Barry Erdos (dissident) 10.7 38%
not elected
—————————————————————————-
David Sgro (dissident) 4.0 14%
not elected
—————————————————————————-
