TVIN (.38) Dissident TVI Shareholders Win Partial Victory
Monday, June 23 2008 11:49 AM, EST
PR Newswire "US Press Releases "
NEW YORK , June 23 /PRNewswire-FirstCall/ -- The "Dissident" TVI Corporation (Nasdaq: TVIN) shareholders, Allen Bender and Jeffrey Squires, won overwhelming support for their Proposal to de-classify TVI's Board of Directors, and also received wide spread shareholder support for all of the Shareholder Proposals they presented for a vote at the Company's annual meeting held last Friday, June 20, 2008 . Messrs Bender and Squires had led a proxy contest against the Board to be elected instead of two incumbent directors, to defeat the Board's proposed Equity Incentive Plan, and to make changes in the Company's Charter and Bylaws which they argued would improve corporate governance. All seven of their corporate governance proposals were endorsed by the nation's two largest independent proxy advisory services.
Based on preliminary results, the one Shareholder Proposal the Company included on its Proxy Card appears to have overwhelmingly passed in spite of the Board's strenuous objection. This Proposal will eliminate the current classified three year terms of directors and require all directors to stand for election each year. The current arrangement, according to the Dissidents, was one of a number of mechanisms the current Board has employed to entrench itself and effectively prevent shareholders from having a meaningful say in the management of the Company. The Board had earlier objected to inclusion of the Proposal on the Agenda, but the SEC had refused to approve the Board's efforts to prevent the shareholders from voting on that proposal.
The obvious concern that TVI shareholders demonstrated by casting almost 10 million votes for the election and the proposals of Bender and Squires was not enough to overcome the inherent advantages and aggressive tactics of an incumbent Board in the proxy contest. The Board was able to exercise the advantages of management prerogatives to vote general proxies against the Dissidents' proposals, after having refused to include most of those proposals on the Agenda it had asked shareholders to vote on at the meeting. Further, attempting to take advantage of legal technicalities, the Board ruled five of the Dissidents' proposed Bylaw and Charter changes out of order, and refused to consider them.
While the Dissident's efforts to penetrate the current Board's defensive maneuvers and win election were largely unsuccessful, they claim vindication for their initiative based on the strong show of support from shareholders. Their effort had faced daunting odds, including the fact that the Board had issued its proxy materials to shareholders long before the dissidents were able to send their materials, and then conducted a scorched earth proxy campaign in which the Company and its proxy solicitors made several mailings and repeated phone calls to thousands of shareholders. The Dissidents contend that such an expensive undertaking was ill-advised for a Company that, during the past several years under the current Board, has seen increasing losses, a 90% decline in shareholder value, and the incurring of some $25 million in debt.
Mr. Bender acknowledged his disappointment at not having prevailed in his election to the board. He also expressed disappointment in the Board's reliance on technical and disputed legal interpretations to refuse to even allow a vote on most his proposals. "I am a firm believer that the company belongs to the shareholders," he said, "and that the Board should work for the shareholders. The Board is our agent, and as such must be accountable to us."
Tabulation of final votes will be done by an independent inspector of elections. The results are expected within the next few days.
Both Mr. Bender and Mr. Squires have a significant stake in the Company, and both wish the Company every success. "The Company reports that it is implementing a turn-around plan, and we hope that it will be successful. We certainly support efforts to correct errors of the past," they said. "For the benefit of all shareholders we sincerely hope that the Company will achieve its intended goals."
SOURCE The "Dissident" TVI Corporation
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