Now that Crown Ocean has called for an EGM at Bowleven there is a maximum of six weeks for the company’s future to be resolved. During this time there are a number milestones shareholders need to be aware of to make sure their votes count in deciding which direction Bowleven should take.
The first milestones are determined by the Companies Act and require the board to fulfil specific legal duties. On receipt of a valid requisition, which it seems Crown Ocean’s is, the directors technically have 21 days to give notice of the EGM. Of course, that is the maximum time limit allowed to them. If they want to get a move on they could quite easily call the meeting tomorrow.
However, when a board of directors is fighting for survival it usually plays for time. For Kevin Hart an extra 3 weeks’ pay equals just over $30,000, so it wouldn’t be at all surprising if Bowleven announced the EGM on Tuesday 14 February.
Once Bowleven gives notice of the EGM the meeting must be held not more than 28 days later. It seems most probable that Bowleven’s EGM will therefore be held on Tuesday 14 March.
Of course, this assumes that the Bowleven board fulfils its legal obligations. There have been instances when boards of directors have ignored valid requisitions. The Companies Act provides for this and gives members of the company the right to host their own meeting on behalf of the company if a board is in default. Members of the company are those people or corporate bodies who are named on the shareholder register.
In sending Bowleven a cheque for £7,000 to cover meeting costs in the event of default, Crown Ocean has shown its determination that the EGM happen as quickly as possible. If Bowleven doesn’t call the meeting by 14 February then expect Crown Ocean to go ahead and call it.
To call the meeting either Bowleven or Crown Ocean will have to issue an RNS (as required by the AIM Rules for Companies) and send out physical copies of the meeting circular and proxy voting forms to all members of the company. Members’ addresses appear on the shareholder register.
If you hold your shares in a nominee account through your broker then you will probably not receive physical copies of the circular and proxy voting forms. Nominee account providers hold the shares and therefore their names appear on the shareholder register. They receive the physical copies of the meeting documentation. Their corporate action teams then process these and inform their clients, who own the shares, that there is a corporate action. This should be accessible through your online account. If you don’t have an online account you can call your broker to ask how you can vote at the EGM.
It usually takes a few days from the meeting being called for the major execution only brokers to receive and process the documentation. Since Crown Ocean has already published the resolutions to vote on, shareholders have time to decide how they intend to vote.
However, there is a final point to be aware of. Whoever calls the EGM will include in the circular a deadline for submission of proxy voting forms. If you hold your shares through a nominee account this will almost certainly NOT be the deadline you have to vote by. Typically the execution only brokers will set a voting deadline about a week before the deadline for the proxy vote submission. The reason for this is it gives the brokers time to process their clients’ votes and then submit them in one batch to the company registrar.
Once the EGM is called I’ll provide more details on this website, as the brokers announce when their voting deadlines are. I’ll also details about how to vote.