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Making your vote count II: CSA finalizes proxy voting protocols

The Canadian Securities Administrators (CSA) have recently released finalized guidance and protocols for meeting vote reconciliation under CSA Staff-Notice 54-305 Meeting Vote Reconciliation Protocols (the Protocols) which are implemented on a voluntary basis. The Protocols mark the latest step in a systemic review that began in 2013 to bring greater transparency and simplicity in vote … Continue reading

Re Hemostemix Inc: Alberta Securities Commission upholds decision of TSXV in contested private placement

Following recent amendments to Canada’s takeover bid rules, private placements in the face of hostile bids have become newly controversial. Private placements in the context of proxy contests have received less attention. Yet this is somewhat surprising, because they are another facet of the same underlying question: whether regulators should allow a financing that may … Continue reading

Universal proxies: SEC proposal moving forward

In a move that may encourage shareholder activism and increase the potential for proxy contests, the Securities and Exchange Commission (SEC) has voted to propose amendments to the U.S. federal proxy rules (the Proposed Rules). As discussed in a previous post, the Proposed Rules will require parties in all “non-exempt” solicitations in a contested director … Continue reading

Evolving tactical defenses by target issuers: Private placements in response to a hostile bid

The Ontario and British Columbia Securities Commissions (the Commissions) issued orders on July 22, 2016 allowing junior B.C.-based miner, Dolly Varden Silver Corp. (Dolly Varden), the target of a hostile takeover bid from Idaho-based Hecla Mining Co. (Hecla), to proceed with a proposed private placement, which was announced shortly after Hecla launched its hostile bid. … Continue reading

Non-standard accounting measures: The media, regulators, and shareholders zero in

Non-standard accounting practices have been gaining in popularity among Canadian publicly traded companies. Issuers that rely solely on standard accounting metrics now make up a small minority of the companies listed in the S&P 500 and S&P/TSX 60. Many issuers believe that non-standard measures are a better reflection of performance than Generally Accepted Accounting Principles … Continue reading

Making Your Vote Count: New Developments on Proxy Voting in Canada

The majority of shareholders in Canada hold their shares through a broker or other intermediary which in turn holds their shares with the Canadian Depository for Securities Limited (CDS). Most voting at shareholder meetings therefore occurs within a layered, complex and opaque proxy system. This leads to uncertainty as to whether all of the votes … Continue reading

More proxy fights and bully M&A tactics to come for commodity issuers; CSA publishes amendments to the Canadian take-over bid regime

Yesterday morning, the Canadian Securities Administrators (the CSA) published the long-awaited amendments to Canada’s take-over bid regime (the Amendments) under Multilateral Instrument 62-104 – Take-Over Bids and Issuer Bids. We believe that these Amendments may result in the increased use of proxy fights and bully M&A tactics by acquirors to effect acquisitions of commodity issuers. … Continue reading

Key takeaways from the first half of 2015

ISS’ preliminary postseason review for 2015 provides a report on U.S. activism trends in 2015.  ISS identifies five key takeaways from the first half of 2015: Proxy access proposals arrived in a big way this season, with almost 120 proposals and average votes in favour of 54.4% (a jump of more than 20 percentage points from … Continue reading

Proxy Advisory Guidance

On April 30, 2015, the Canadian Securities Administrators (CSA) adopted National Policy 25-201 Guidance for Proxy Advisory Firms (the Policy). The Policy provides non-prescriptive and non-exhaustive guidance on recommended practices and disclosure for proxy advisory firms. The guidance is intended to promote transparency in the processes leading to vote recommendations and the development of proxy … Continue reading

CSA issues progress report on its review of Proxy Voting Infrastructure

The Canadian Securities Administrators (CSA) recently provided an update on their ongoing review of proxy voting infrastructure. The progress report follows the publication of CSA Consultation Paper 54-401 Review of the Proxy Voting Infrastructure in August 2013 (the Consultation Paper). The Consultation Paper examined two issues: (i) the accuracy of vote reconciliation in the current … Continue reading

Decision-making and Institutional Investors: Prevalent Factors and Key Market Distinctions

According to the recently published Global Institutional Investors Insight survey, shareholder activism is on the rise. The survey, which canvassed over 500 institutional investor and sell-side research analysts from across North American, European and Asian markets, reports that more than three quarters (77%) of those surveyed believe that activism levels will increase in the coming … Continue reading

Proxy solicitation: Not a matter of right in Alberta

The increasing prevalence of shareholder activism in Canada has significantly impacted issuers and investors alike in the Canadian capital markets. Consequently, an understanding of the Canadian regulatory landscape governing activist activities has become increasingly important for both sides of an activist struggle. A key element of this understanding is acknowledging that the regulatory landscape is … Continue reading

Corporate Governance 2014: Corporate Governance in Special Situations

Norton Rose Fulbright Canada LLP and Lexpert will again be co-hosting two full-day seminar sessions entitled “Corporate Governance 2014: Corporate Governance in Special Situations” on December 4th (Toronto) and December 8th  (Calgary). These seminars will include discussions on corporate governance developments in special situations, with specific focus on the trends, tools and defences used during … Continue reading

‘Wolf Packs’ and Other Recent Trends in Hedge Fund Activism

The recent increase in hedge fund activism is “hyperbolic” and should be carefully assessed, according to two notable scholars, John C. Coffee Jr. (corporate law; Columbia) and Darius Palia (corporate finance; Rutgers), who have just published on comprehensive study on hedge fund activism entitled, “The Impact of Hedge Fund Activism: Evidence and Implications.” The authors … Continue reading

ISS Updates its Proxy Voting Guidelines for the 2015 Season

On November 6, 2014, Institutional Shareholder Services (ISS) released updates to its Canadian proxy voting guidelines for the 2015 proxy season.  The voting guidelines are effective for meetings held on or after February 1, 2015.  The following is a summary of the most significant changes. Director Elections Director Independence: ISS has made several changes to their … Continue reading

2014 Q3 Proxy Update

The 2015 proxy season is fast approaching, PwC and Broadridge released a quarterly research report  which reviews proxy related data from 4,113 shareholder meetings held between January 1 and June 30, 2014 and  highlights several themes and trends that may inform how shareholders and companies will interact on four key issues: Director Elections: Director elections continue to attract widespread … Continue reading

Defensive Tools in Shareholder Activism: The “Voting Pill”

In today’s Financial Post,  Barbara Shecter highlighted the use of modified shareholder rights plans (colloquially known as “poison pills”) as an emerging defensive tool against opportunistic shareholder activism in Canada.  Traditionally, poison pills are used by boards of target companies as defensive tools to guard against unsolicited takeover bids.  By expanding the typical definition of … Continue reading

Enhanced Disclosure Requirements on Women in the Boardroom

The securities regulators in 7 provinces and 2 territories announced on Wednesday, October 15, 2014, that the final version of the amendments to National Instrument 58-101 Disclosure of Corporate Governance Practices (NI 58-101) and Form 58-101F1 Corporate Governance Disclosure (Form 58-101F1) would include stringent requirements pertaining to female representation on boards and in executive officer positions. … Continue reading

Golden Leashes: Is Regulatory Intervention Warranted?

In the most recent volume of the Canadian Business Law Journal, Edward M. Iacobucci, Professor with the Faculty of Law at the University of Toronto, addresses certain arguments against dissident shareholders providing their director nominees with a future incentive if the target company’s share price increases following such nominee’s election to the board.1  These special … Continue reading

CSA Drops Early Warning Report Proposals

The Canadian Securities Administrators (the CSA) provided an update today on its proposed amendments to the early warning system regime. Specifically, the CSA announced that it has determined that they will not proceed with: (a) the proposal to reduce the reporting threshold from 10% to 5%; and (b) the proposal to include “equity equivalent derivatives” … Continue reading

A Changing Climate for Proxy Advisory Firms: Developments in the US and Canada

The role of proxy advisory firms in the marketplace has been a focal point on both sides of the border as recent guidance by the US Securities and Exchange Commission (SEC) and the Canadian Securities Administrators (CSA) highlights the powerful influence of proxy advisory firms and need for increased accountability and transparency. In the US, … Continue reading

Trends and Predictions in Canadian Proxy Contests

Kingsdale Shareholder Services has released its 2014 Proxy Season Review.  In its report, Kingsdale discusses trends observed in 2014, predictions for the future, and gives its key recommendations for companies in the Canadian marketplace.  In reviewing 2014 and comparing it to the previous year, Kingsdale observes: By the numbers – the total number of proxy … Continue reading

Canadian Securities Administrators to Propose Amendments to Canadian Take-over Regime

The Canadian Securities Administrators (CSA) have announced that they intend to publish for comment significant amendments to the Canadian take-over bid regime in the first quarter of 2015. The amendments are an initiative of all CSA members and are intended to strike a fair balance between the interests of bidders and the boards of directors … Continue reading
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