Vetting a Company’s “Refresh” Candidate

After months of talks between an activist investor and a company, we were engaged to vet a prospective board director candidate who the company had suggested could refresh the board. 

Our scrutiny of the candidate’s previous directorships uncovered significant issues, including a vote against an acquisition on one previous board (a decision that proved catastrophic for the company), an undisclosed relationship that undercut the candidate’s “independent” status on another board, and shareholder litigation while on the audit committee of a third board over a restatement of financial results, which resulted in a large multimillion-dollar settlement with shareholders.