An Argo Group shareholder accusing the company and CEO Mark Watson III of extravagant spending practices now claims that the carrier illegally appointed two board members.
Argo disagreed, continuing a very public battle between Voce Capital Management LLC and itself that began more than a month ago over allegations that the board had supported excesses including a pricey art collection and luxury home/corporate jet travel for Watson. Voce has also nominated its own slate of independent board member candidates.
Argo, a Bermuda-based property/casualty specialty insurer and reinsurer, denied that it has pursued excessive spending practices at the company.
The latest dispute stems from Argo’s Feb. 20 announcement that it had appointed industry veterans Samuel Liss and Tony Latham as independent directors to its board of directors. Voce issued a statement on March 26 condemning their appointment as illegal under the company’s bylaws and Bermuda law.
Voce claims Argo’s bylaws allow directors to only fill “a casual vacancy” between annual meanings, which it asserted has only been after a death or resignation according to “well-settled precedent.” That wasn’t the case with the Liss and Latham appointments, Voce said.
“At the time of the board appointments of … Liss and Latham … there were no casual vacancies for the board to fill,” Vocce said, arguing that their appointments are “null and void” as a result.
Voce said it wants Argo’s board to rescind the appointments and for Argo to refile its proxy statement with disclosures about the board’s size, compensation and class of its directors.
Argo responded on March 27, issuing a statement that defended its board appointments and called Voce’s ongoing push to revamp the company’s board “disappointing.”
“It is disappointing that Voce Capital continues to engage in a campaign of misinformation to support its activist campaign to remove members of Argo’s well-qualified and experienced board,” Argo said in its statement.
Argo said it “properly appointed” Latham and Liss to fill two vacancies, bringing the number of directors up to 13 as authorized by the company’s bylaws and Bermuda law.
Argo’s said Voce was “simply incorrect” to challenge the appointments and questioned the firm’s overall motives.
“It is telling that Voce waited five weeks to raise its latest attempt to distract Argo’s shareholders,” Argo said in its statement. “Our board remains focused on continuing Argo’s strong performance and looks forward to continuing to engage with all shareholders in the coming weeks.”
Sources: Argo Group International Holdings, Voce Capital Management LLC