Payfirma shareholders vote to oust half its boardroom

Shareholders voted to remove Coastal Contacts Inc. founder Roger Hardy, Peer 1 Hosting founder Lance Tracey and Mosam Ventures founder Marc Levy from Payfirma's boardroom ...
From left, Coastal Contacts Inc. founder  Roger Hardy, Payfirma CEO Michael Gokturk and Hootsuite CEO Ryan Holmes all sit on the board of Payfirma, where its six directors are embroiled in a public dispute that has resulted in a defamation lawsuit | Credits: Richard Lam, Chung Chow, submitted

Shareholders of a Vancouver-based financial technology company have voted to oust three directors ensnared in a public boardroom battle.

Payfirma Corporation’s boardroom has been split between two factions since it began examining the prospects of a reverse takeover during the summer.

It came to a head Tuesday (October 24) when shareholders voted to remove Coastal Contacts Inc. founder Roger Hardy, Peer 1 Hosting founder Lance Tracey and Mosam Ventures founder Marc Levy from Payfirma’s board, according to an email from Kingsdale Advisors, the firm handling the proxy fight on behalf of the fintech's CEO.

Toronto lawyer Paul Pathak will replace the trio while Payfirma CEO Michael Gokturk, Hootsuite CEO Ryan Holmes and BluePay executive chairman John Rante got the nod to retain their seats in the boardroom.

The ensuing fallout between the two sides has netted court action, a defamation suit and a public war of words between the two sides.

Court documents reveal that the board struck a special committee over the summer to consider a reverse takeover from an unnamed third party with an unspecified going-public transaction to follow.

Gokturk told shareholders in a September 20 letter that the three opposing board members wouldn’t allow him to advance the transaction to the point it could be presented to shareholders to either accept or reject it.

He accused Hardy, Tracey and Levy in the letter of “self-dealing” and trying to “seize control” of the company.

Tracey filed a defamation suit against Gokturk on September 26.

The two factions continued trading barbs throughout subsequent press releases leading up to the shareholder vote.

The three opposing directors went to court in early October to postpone the shareholders’ vote until the following month.

But an October 6 decision from B.C. Supreme Court Justice J. Christopher Gauer ruled against the opposing directors’ efforts to postpone the vote.

Richard Powers, a corporate governance expert at the Rotman School of Management at the University of Toronto, told Business In Vancouver in September he did not believe Gokturk would have pursued efforts to oust the opposing directors if he did not believe he already had the votes from shareholders.

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