Dissident shareholders have demanded that Montreal-based Miranda Technologies hold a special shareholder meeting for the purpose of replacing a majority of the board of directors. But the board, after consulting its legal counsel, has refused the request.
“Miranda’s current Board of Directors has been unchanged since 2006 and the independent directors own virtually no shares in the Company (less than 0.3%),” said an announcement by Massachusetts-based JEC Capital Partners, which claims to own 7.1% of Miranda’s stock. JEC requested the special meeting along with Los Angeles-based JMB Capital Partners, stating that the two combined own more than 10% of Miranda’s stock.
But the company says the request is not valid. “Pursuant to the Business Corporations Act (Québec), a requisition must be signed by a registered shareholder of the Corporation. Neither JEC nor JMB is registered in the Corporation’s securities register. If a valid shareholder requisition is received, the board of directors of the Corporation will give such requisition due consideration,” Miranda announced. It did, however, announce that their regular, annual shareholder meeting has been scheduled for April 17, which will include the election of directors.
“The board of directors of Miranda has chosen to hold our annual meeting at a significantly earlier date than usual. The board and management look forward to this opportunity to meet with Miranda’s shareholders in order to review the Corporation’s achievements in 2011 and to discuss the Corporation’s performance,” said Miranda board Chairman Brian Edwards.
What has the dissidents upset is a 42% drop in market capitalization from the end of 2005 through December 12th, the day before the request for the special meeting was submitted. “The current Board has approved two major acquisitions that were dilutive to shareholder value,” JEC complained. “During the past 12 months, JEC Capital has made numerous attempts to engage the current Board in constructive dialogue regarding strategic actions to maximize shareholder value, without success. While no single director is solely responsible for the loss in shareholder value, the Board as a whole should bear responsibility for the inability to effectively advance the interests of shareholders.” The investor had previously provided the board with the names and bios of three potential nominees who would be independent directors and one as an investor representative. None have been added to the board, so it remains to be seen whether there will be a proxy battle.
Even as the battle continues over board representation, the investor says things are getting better at Miranda, which provides hardware and software solutions for the television broadcast, cable, satellite and IPTV industry.
“JEC Capital continues to be encouraged by the financial and operational performance of Miranda and we are fully supportive of the Company’s management. Miranda’s directors should have the best interests of all of Miranda’s shareholders as their first priority and aggressively explore all value-creation opportunities, including a strategic review of Miranda’s assets to determine the fair market value of the company,” JEC said when it called for the special meeting.