Circular to Shareholders9 Nov 2013 11:37
*** http://corporate.hibu.com/~/media/Files/H/Hibu-V2/Attachments/content/circular-and-notice-of-general-meeting.pdf ***
Extract from page 3 ---
Where a company is in financial difficulty, the Directors’ duty to promote the success of the Company must
be exercised with primary regard to the best interests of creditors rather than Shareholders and those duties
would apply to any new directors appointed to the Board.
*** My comment ***
I think “Primary regard” to the lenders still suggests shareholders are entitled to some (all be it secondary) consideration.
Extract from page 3 ---
The Directors argued that Shareholders should receive a payment but, given the Group’s debt structure, the heavy losses incurred by the lenders and their superior ranking and security as creditors, the Coordinating Committee was not prepared to offer any value to the Shareholders by (a) allowing any payment to be made or (b) leaving the Company with any assets such that the Company’s shares would have value.
*** My Comment ***
The possibility of equity settlement was considered ... it would be nice to why the directors felt shareholders should have been given something and what arguments they presented on our behalf to the CoCom?
Extract from page 4 ---
Should a material number of the Proposed Directors be appointed at the General Meeting or the Company determine that this is likely to occur, it is expected that the Company will be placed into administration.
*** My Comment ***
Given this stance I think it would be appropriate for the action group to up the ante and propose resolutions to dismiss all directors … if there is still time? -------
*** Additional Comment ***
I still think it is important that action group candidates, disclose and constrain their remuneration ambitions, and I will not vote for them unless they do. I don’t care if this effectively means voting for the destruction of my position … morality matters!
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