December 11, 2012

Advance Notice Policy Becoming Key Tool in Canadian Proxy Contests

This Davies Ward memo notes how at least three Canadian companies recently have adopted advance notice policies – Mundoro Capital, MAG Silver and most recently Bell Copper. Such a policy, which is effective upon adoption by the board, requires any person proposing to nominate a director for election at a meeting of shareholders to provide the company with advance notice of, and prescribed details concerning, any such proposed nominee. Unless proper notice is given to the company in accordance with the prescribed notice period, any such proposed nominee is ineligible for election at the shareholders meeting. Each of Mundoro Capital and MAG Silver put its advance notice policy to shareholders for approval, on the basis that the policy would terminate on expiry of the shareholders meeting (but after the election of directors) if not approved by shareholders at that meeting. The memo then delves into these policies in detail…