The Griffin Corporation

The Griffin Corporation

December 13, 2006 10:32 ET

The Griffin Corporation: Announces Court Ruling

KITCHENER, ONTARIO--(CCNMatthews - Dec. 13, 2006) - The Griffin Corporation (TSX VENTURE:GRN) today announced that the Ontario Superior Court of Justice at Toronto has rendered a decision with respect to the Application filed by Gerald Kluwak under the Business Corporations Act R.S.O 1990 Ch. B.16 against the Corporation and its Chairman Mr. Irwin W.Pasternak. The Application sought an order to set aside the decision made by the Chairman disallowing dissident proxies at the Annual Meeting of Shareholders held on July 21,2006.

The Court addressed two issues namely, (i) Whether the Dissident Proxy Circular contained material misrepresentations; and, if so, (ii) whether the meeting chairman's disallowance of the dissident proxies was correct.

The Court has stated that the dissident proxy circular was materially misleading in that it deprived shareholders of sufficient information to form a reasoned and informed judgment. The Court went on to state "..........omissions from the dissident proxy circular created a very different view of important events in the recent past of the Corporation than what really occurred. The omissions create innuendoes of dishonesty, or perhaps a breach of contract, when the true factual record is quite different". The Court indicated that there is a substantial likelihood that a reasonable shareholder would have been misled by the dissident's circular and the missing or misstated facts would be considered important by reasonable shareholder in deciding how to vote for the board of directors.

On the second issue, the Chairman correctly ruled that the dissident proxy circular was misleading. The Court however was of the opinion that the management should have reviewed the dissident proxy circular prior to the meeting and either requested that the circular be recirculated or redrafted, or applied to the court for directions. The Court was of the view that, while the Chairman's actions were not made in bad faith, and made with the assistance of legal advice, they did not promote the integrity of Griffin's voting procedures and hence the Chair's actions were incorrect.

Accordingly, the Court has ruled the election is invalidated and that a new election is to be held at a date that will give sufficient time for the dissident group to correct the material misstatements in the dissident proxy circular and for management to amend the management circular, if they wish. The dissidents are to pay for their own circular.

Any appeals of the decision must be lodged within 30 days. The Corporation will keep the shareholders informed of any further developments on this matter.

For further information contact the Chairman Irwin W. Pasternak at (519) 744-4400 or mail the Corporation at 73, King Street West, 2nd Floor, Kitchener ON N2G 1A7.

Contact Information

  • The Griffin Corporation
    Irwin W. Pasternak
    (519) 744-4400