CVTECH URGES SHAREHOLDERS TO SUPPORT CORPORATION'S BOARD OF DIRECTORS AND VOTE THE WHITE PROXY CARD TODAY
DRUMMONDVILLE, QC, May 23, 2012 /CNW Telbec/ - CVTech Group Inc. ("CVTech" or the "Corporation") (TSX: CVT) today announced that Glass Lewis & Co. ("Glass Lewis"), a leading independent proxy advisory services firm, has issued a report recommending that the Corporation's shareholders vote in favour of the election of the directors nominated in the Corporation's circular filed on May 8, 2012, namely Jacques Joly, André Laramée, Robert Beaudoin, Serge Chiasson, André Lepage, Luc Reny, and Guy Aubert. All aforementioned directors are standing for re-election at the Corporation's Annual and Special Meeting of Shareholders on May 30, 2012.
Glass Lewis also recommends shareholders of the Corporation do not vote for the seven directors nominated by Guy Aubert (the "Dissenting Shareholder") in a circular filed on May 14, 2012.
In recommending that shareholders vote FOR all nominees on the Corporation's WHITE proxy card, Glass Lewis noted that:
- The position adopted by the Dissenting Shareholder is paradoxical in nature, as his assertions seem to stand in odd contrast to his recent history with the Corporation. The Dissenting Shareholder would seem to not only have reasonable insight into, and influence upon, the Corporation's strategy, but would, it seems, bear no small amount of responsibility for CVTech's performance, both positive and negative, during the period he reviews.
- The Dissenting Shareholder laments of excessive executive compensation. However, as he joined the Human Resources and Compensation Committee (the "Committee") shortly after resigning as a senior executive in May 2010, this procession would seem to suggest he has historically been in a position to directly impact the compensation he now criticizes.
- Glass Lewis does not believe that the Dissenting Shareholder has made a valid case for the election of new directors to CVTech's Board. Glass Lewis sees no cause to suggest the existing Board has so clearly failed this standard as to warrant replacing all members, and certainly sees no reason why the Dissenting Shareholder would be abdicated of his responsibility in such a scenario.
Glass Lewis concluded that: "While we find some merit in certain of the Dissenting Shareholder quantitative arguments, we do not find CVTech's recent operational shortcomings serve as a clarion call for overwhelming board-level change. 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. Moreover, up until late April 2012, the Dissenting Shareholder undertook actions that conveyed clear and direct support for the incumbent board members, including a circular which contemplated the reelection of all current board members at the 2012 Annual General and Special Meeting of shareholders, including himself. Further still, in offering a response to the Dissenting Shareholder's sudden contest, the incumbent members continue to recommend shareholders support the election of the Dissenting Shareholder, thus affording him the continued opportunity to provide his perspective at the board level."
Glass Lewis stated that a well-functioning informed and independent Board of Directors should receive reasonable deference on strategic matters. Such a Board is often in the best position to assess the Corporation's strategic alternatives. Based on available disclosure, Glass Lewis is inclined to agree with the Board's determination. Given this determination, and in the absence of additional disclosure, Glass Lewis believes shareholders would be best served by supporting the incumbent nominees.
Accordingly, Glass Lewis recommends shareholders vote FOR all nominees using management's WHITE proxycard.
CVTech will be holding its Annual General and Special Meeting of shareholders on Wednesday May 30, 2012 at 10:30 a.m., at the Centre Sheraton Montreal, Salon Drummond, 1201 Rene-Levesque Boulevard West, Montreal, Quebec. To ensure your vote counts, proxies must be received prior to 5:00 p.m. Eastern time, on May 28, 2012 using one of the methods described on the WHITE form of proxy.
If you have already voted using the dissident blue shareholder proxy you have every right to change your vote as it is the later dated proxy that will be counted. Shareholders with questions or needing assistance in voting their WHITE proxy are encouraged to call CVTech's proxy solicitation agent, Georgeson, North American Toll Free Number: 1-866-909-6468, Email: email@example.com
OVERVIEW OF THE CORPORATION
CVTech is a management company operating in two sectors. Through Thirau ltée and its subsidiaries, Riggs Distler Inc. and Thirau LLC, the Corporation provides services to the electric power industry for the maintenance of transmission and distribution lines, primarily in Quebec, Ontario and the eastern United States. Another Thirau ltée subsidiary, J.J.L. Déboisement inc., specializes in control of vegetation surrounding power lines and in clearing rights of way. Thirau LLC's wholly owned subsidiary Riggs Distler & Company, Inc. is a leading provider of maintenance and construction services to the utility and heavy industrial markets. In the CVT Systems and Related Products Segment, the Corporation, through CVTech-IBC Inc., designs, manufactures and sells continuously variable power transmission systems, or CVT systems. CVTech-AAB Inc. specializes in rebuilding crankshafts and cylinders and in distributing engine parts.
This document may contain forward-looking statements that reflect management's current expectations regarding future events. Forward-looking statements are based on a number of factors and include risks and uncertainties. Actual results may differ from forecast results. Management has no obligation beyond what is required under the law to update or revise forward-looking statements pursuant to new information or future events.
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Source: CVTech Group Inc.
André Laramée, MBA
President and Chief Executive Officer
Mario Trahan, CMA
Chief Financial Officer
Martin Goulet, CFA