I tried to google this but couldn’t find useful info.
An investment company which manages one of my mutual funds is looking to restructure under an Ontario charter rather than a (Canadian) federal charter.
The vote will be in a few weeks, on a Monday morning, on the 68th floor of an office tower in distant Toronto. I’ve received a proxy form concerning this vote. The form allows me to vote YES or ABSTAIN on the proposal, and applies on the day of the vote or at any subsequent date if adjourned.
So, if I understand correctly, if I wanted to vote NO, I would have to be there in person that Monday morning? And, if enough people showed up with the intention of voting NO, or if there were too many attendees for that (presumably small) room on the 68th floor, they could choose to adjourn until 3 AM the following Thursday, still having all the mail-in YES votes, but getting rid of the NO voters?
I don’t mind the proposal in this particular instance, but this strikes me as a completely ridiculous way of soliciting votes from shareholders.
Is this the way companies usually do these sorts of things?
What are the conditions for the motion to pass? Does it require that the YES votes outnumber the NO votes, or that the YES votes be over half of the total eligible votes, or over half of the votes returned? It might be that an ABSTAIN vote is functionally identical to a NO vote.
It may be a Canadian or Ontario thing. My annual Tim Horton’s proxy comes like that each year. I don’t think any of my US investments do, though.
Ah, thank you for the replies.
I just read through (as an amateur) the “Canadian Business Corporations Act” and couldn’t find anything concerning choices between YES, NO and ABSTAIN (or YEAS, NAYS and ABSTAIN, or FOR, AGAINST and ABSTAIN), and the majority rules for assemblies.
But there’s a doctrine in Canada that the queen and Tim Hortons can do no wrong, so I guess this is standard practice. 
I’ve never seen it, and my job is sending notifications of shareholder meetings out to the clients.
Canadian companies often have only For and Withhold options available, but Withhold and Abstain are two different things.
Oh, my apologies. My proxy is in French:
I just translated “S’ABSTENIR” into “ABSTAIN”, but the English text may actually say “WITHHOLD” for all I know.
In my youth, the proxy forms only ever had “YES”. Or actually “Vote as we choose, which will be Yes”. The management was asking for your proxy. Why would they vote against their own recomendation? If you didn’t want them running the company, why are you an investor?
You give your proxies to the management to prevent some crazy minority shareholder turning up at the meeting and voting to give himself all the money.
Once or twice in my life, I have read about dissident shareholders running a “NO” campaign where they did proxy-request mailouts, requesting your proxy for a “NO” vote. It was very rare.
AFAIK, the provision for prixies voted {I}abstain[/I} came about to allow you to split your vote, voting with managment on some motions, against on others. They won’t vote against the recomendation, but you can give your proxy for that motion to someone else, who will.