8k8app

None

A new front is opening in the chaotic war over the future of Dye & Durham Ltd. DND-T . Past and present senior executives have hired a lawyer to take on four large institutional shareholders they accuse of trying to take over the company illegally and blocking a potential takeover. One of those is chief executive officer Matt Proud, according to a source familiar with the situation. The group’s intent is to convince a court to block the named investors from voting at the annual meeting on Dec. 17, at which shareholders of the Toronto-based real estate software vendor will be asked to choose between two competing director slates – one proposed by the company and another from activist investor Engine Capital Ltd. The employees are also hoping to postpone the meeting altogether. Lawyer Susan Kushneryk of Kushneryk Morgan LLP on Saturday wrote to D&D investors Engine, EdgePoint Wealth Management Inc., OneMove Capital Ltd. and Mawer Investment Management Ltd saying she was in the process of being retained by “certain current and former employees” who each have “significant shareholdings” of D&D. She didn’t disclose who the employees are but the source familiar with the situation said the group includes Mr. Proud, former chief legal officer Charlie MacCready and at least one other current senior executive. Both Mr. Proud and Mr. MacCready declined to comment, as did the company. Ms. Kushneryk didn’t reply to messages. In her letter, Ms. Kushneryk accused the four investors of harming the value of her clients’ shareholdings due to their “wrongful actions,” accusing them of acting “jointly and in concert to take control of D&D, amounting to an undisclosed take-over bid” in breach of the Ontario Securities Act. She said her clients allege the shareholders contravened the act by preventing bids in a recently abandoned sale process of the company from proceeding, which “would provide shareholders with a significant premium” for their shares. The Globe and Mail reported last week that D&D had paused a sale process that yielded four conditional takeover bids in the low to mid $20s range per share. It put the process on ice after D&D officials spoke with Mawer and EdgePoint representatives to gauge whether they would support an offer. They came away feeling the company wouldn’t necessarily get their support. Ms. Kushneryk wrote that the employee group is preparing an application “to seek court assistance to protect our clients from further harm and to obtain compensation for the damage that they have suffered as a result of the legitimate bids being blocked.” The employee group will seek “to prevent you or your clients from voting their shares at any shareholder meeting until the wrongdoing has been addressed, and to postpone any upcoming shareholder meetings.” Engine managing partner Arnaud Ajdler said in an e-mail: “It’s clear that the board is unable to manage CEO Matt Proud as he grows increasingly desperate to maintain control of the company.” Mr. Ajdler added Mr. Proud “appears to now be weaponizing his employees to frivolously sue shareholders in a last-ditch effort to delay the upcoming annual meeting. The board should have stepped in to end this behavior a long time ago. The culture at Dye & Durham is fundamentally broken and this latest sideshow demonstrates exactly why a complete overhaul of the Board is necessary.” Engine has repeatedly denied being part of a co-ordinated effort among shareholders to achieve its aims. A Mawer representative declined to comment, and calls to Edgepoint and OneMove principal Tyler Proud – the brother of Matt Proud and D&D’s former chairman – weren’t returned. The legal threat comes after D&D twice in recent months tried to use a Competition Bureau investigation into the company for alleged trade-restricting practices to entrench management and directors by delaying the annual meeting. In both instances the gambit failed. It also follows months of wrangling at the board over what if any actions to take against the four shareholders. Engine early this year launched an activist campaign asking for a special meeting to vote off three of the company’s seven directors and replace them with its nominees. That meeting, set for August, was postponed after Tyler Proud’s holding company tried unsuccessfully to piggyback its own proposal onto the Engine meeting: to have shareholders vote off its nominee to the board, Ted Prittie, and replace him with hedge fund manager Eric Shahinian. That delay led to Engine, which owns 7.1 per cent of the stock, pulling its request and returning with a proposal to vote six nominees to the company’s seven-person board at the AGM. D&D, meanwhile, has proposed a mostly new slate with four new members. Mawer and Edgepoint were both critical of management and the board last fall and involved in efforts to push out directors in 2023. Earlier this year, the board commissioned law firm Groia & Co. to investigate whether the shareholders acted in concert to push for governance changes, which, because their shareholdings add up to more than 20 per cent, could amount to an illegal takeover attempt under Section 105 of the securities act. The contents of the report are unknown, although the company has accused the group of acting together and trying to achieve “a zero-premium takeover” of the company. However, the company and board did not take any legal action. A source familiar with the situation said that was because of a split: Matt Proud, Mr. Derksen and Mr. Prittie, favoured taking legal action while the other four did not. Frustration with the stalemate, the abandoned sale process and fears they could lose their jobs prompted the employee group to explore their options and engage the law firm, the source said. The Globe and Mail is not identifying the source as they are not authorized to discuss he matter. It has been a tumultuous 12 months for D&D, which has faced four governance challenges from investors dissatisfied over its leverage, pace of acquisitions and board oversight over management. It has also refinanced its debt, slashed staff and is facing the competition bureau investigation, all while its stock has continued to trade at depressed levels compared to highs reached a year after its July, 2020, initial public offering.Kroger Co. stock underperforms Tuesday when compared to competitorsThe best Black Friday deals from A to Z

‘Real reason’ Dean McCullough got record stars in Bushtucker Trial – and it’s NOT because he faked fear, says Radio1 pal