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/// The Commodore Shareholder Movement
ATTENTION COMMODORE SHAREHOLDERS! 6/18/93
In response to the overwhelming thirst for information concerning
your rights as shareholders, the following information was obtained
from the Securities and Exchange Commission. After reading it, you
will see the obstacles to the election of new Commodore Directors.
Commodore is subject to Bahamian laws rather than U.S. federal and
state securities laws. This gives the Directors a great deal of
power to deny shareholders their rights to include proposals in the
proxy statement, to obtain the by-laws and charter of the company
(necessary to know shareholder rights), and to obtain the list of
shareholders for communication purposes. If you have experience in
these areas and would like to join the cause, please contact us:
Commodore Shareholder Movement
P.O. Box 8296
Philadelphia, PA 19101
Information for Investors
from the U.S. Securities and Exchange Commission
SHAREHOLDERS' RIGHTS TO VOTE
The corporation laws of most states, as well as company charters and
by-laws provide corporate shareholders with several important rights.
Among these are the right to vote for the election of directors who
will oversee management of the company, and the right to vote on
matters as changes to the articles of incorporation or by-laws,
dissolution, and mergers with another company. In each instance,
shareholders' votes may be critical to the future existence of the
Prior to the annual meeting of its shareholders, the board of
directors of a company establishes a record date for purposes of
determining the shareholders who are entitled to vote at the meeting.
This means that a shareholder must own the securities of the company
on that record date in order to be eligible to vote them at the
annual meeting. Under the laws of most states, the record date must
be not more than 50, nor less than ten days prior to the meeting of
shareholders. (in addition to the annual meeting, corporations
sometimes also hold a special meeting of shareholders).
Once identified, all shareholders entitled to vote are sent a proxy
form, which allows them to vote by mail on management or shareholders
proposals. Unfortunately, many shareholders receiving such proxies
do not take the time to examine the accompanying material to
determine what corporate action they are being asked to vote for or
against. They may later discover that the other stockholders had
voted to liquidate, merge or sell the company business.
While an individual shareholder's vote may not block a proposed
action, the proxy solicitation material does contain information
vital for shareholders to know in order to make sound investment
decisions. For example, if you fail to read the terms of any
proposal or not, you may later discover that it is too late to
participate in an exchange or redemption offer and that you do not
have any remedies available to restore your ownership interest in the
The Securities and Exchange Commission ("SEC") receives many
inquiries from investors who fail to receive notices of shareholders'
meetings or impending corporate proposals. If you hold possession of
your own stock certificate, it is important that you make sure the
company has your current correct mailing address. If, however, your
shares are held by a broker ("in street name"), you cannot vote
directly with respect to those shares since your name does not appear
on the company's records as a shareholder entitled to vote. However,
brokers who hold securities in street name for their customers are
required, under the rules of the National Association of Securities
Dealers and the exchanges of which they are members, to forward to
the actual ("beneficial") owners, the material received from the
company. The shareholders must then instruct his broker how he or
she wishes to vote. Most companies take pains to furnish proxy
material promptly to brokers in sufficient quantity to permit them to
re-transmit the material promptly to shareholders in time for the
shareholders to respond. Occasionally, however, shareholders fail to
receive the material in time for it to be useful. This is one of the
reasons many investors prefer to have securities registered in their
own name rather than having the certificates held in street name by a
Questions concerning shareholders' votes may be addressed to the
Office of Consumer Affairs and Information Services, Securities and
Exchange Commission, Washington, D.C. 20549
Among the many rights of a corporate shareholder are the right to
elect the members of the board of directors of the corporation, and
the right to vote on the approval of certain corporate decisions.
These rights are exercised at the annual meeting of shareholders
which is held in accordance with the laws of the state in which the
corporation was chartered.
At the present time, the statutes of all states contain provisions
which specifically cover the holding of an annual meeting of
shareholders. For example, Section 28 of the Model Business
Corporation Act, applicable in most states, provides in part: "An
annual meeting of shareholders shall be held at such time as may be
stated in or fixed in accordance with the by-laws". In addition to
the election of directors, in most states, fundamental corporation
changes such as mergers, dissolutions or amendments of the articles
of incorporation are also required to be submitted to a vote of the
shareholders at the annual meeting.
Annual meetings -- and the process of soliciting proxies prior to
such meetings -- function as important means of communication between
management and shareholders. The federal securities laws include
requirements dealing with the form and content of the communications
with shareholders sent in connection with an annual meeting.
First, under the Securities Exchange Act of 1934, if a proxy
solicitation is sent to shareholders on behalf of the board of
directors of a corporation for an annual meeting of shareholders at
which directors are to be elected, the proxy statement must either be
accompanied or preceded by an annual report. This is an extensive
report on the company's operations and financial results for the
year, and is considered by most companies to be the single most
important shareholder communication published during the year.
In theory, shareholders attend annual meetings to listen to a report
on how the board and management have discharged their fiduciary
obligations during the past year, and, depending on what they hear
and have read in the proxy statement and annual report, elect
directors for the ensuing year. Some investors do actually go to the
meeting for this purpose. However, most investors, after reading the
material sent to them, choose to vote by proxy. Therefore, the
election of directors is usually decided by proxy votes submitted
before the annual meeting takes place.
Even though only a few shareholders may actually attend an annual
meeting, many others do use the proxy mechanism to raise questions
and give their views on the company and its operations. This may be
done in the form of a letter submitted to the company with the
returned proxy. This period of preparation prior to the meeting
requires management to address and formulate positions on issues
which are of concern to shareholders.
The federal securities laws require that shareholders' proposals be
included in the proxy statement sent to all shareholders if they meet
certain tests. Management may take a position with respect to such a
proposal and recommend that shareholders vote for or against it, or
it may submit the proposal for voting with no recommendation.
One of the most frequent questions from shareholders is "who may call
a shareholders meeting?" The by-laws of a company generally indicate
who may call a regular or special meeting of shareholders.
Occasionally, provisions governing the calling of meetings may be
included in the company's articles of incorporation. In many states,
the manner of calling a meeting is fixed by statute.
If you have specific questions concerning shareholders' meetings, you
may wish to contact the Office of Consumer Affairs and Information
Services, Securities and Exchange Commission, Washington, D.C. 20549.
Many investors who buy stock in a company are unaware of the rights
which that ownership affords them. The specific rights of an
investor may depend, however, on the type of stock they own, the laws
of the state where the company is incorporated, and the by-laws and
charter of the company itself.
Companies generally issue one or more of various types of securities.
The most well-known are common stock, preferred stock, and
debentures or bonds. Investors who buy a share or shares of common
or preferred stock are, in effect, actually buying an equity or
ownership interest in a company. A debenture or bondholder is giving
the company a loan of his money to use as capital, in return for
which he or she may get a periodic interest payment which the bond
agreement may call for, and the face amount of the bond at maturity.
Under the company's by-laws and charter, the specific rights of
shareholders who own each type, or class, of security may differ.
For example, a company's charter may specify that only the common
stock may have voting privileges, or that the preferred stock must
receive dividends before any dividend is paid to the holders of
common stock. The specific type of payments and privileges of a
bondholder are also stated in the charter. In addition, the charter
may state that if the company is liquidated, a bondholder would
receive payment before the common and preferred shareholders.
Therefore, it is important for a shareholder to read the company's
by-laws and charter thoroughly to find out what his or her specific
An investor should also be aware of the rights granted by the laws of
the state in which the company is incorporated (the state of
incorporation is shown on the face of the certificate). Most states
provide that shareholders' rights shall include, among other things,
the right to: (1) vote on questions affecting the company as a
whole; (2) hold a proportionate ownership in the assets of the
company evidenced by a stock certificate; (3) transfer ownership of
their shares; (4) receive dividends when declared by the Board of
Directors; (5) inspect the corporate books and records; (6) sue the
corporation for wrongful acts; and (7) share in the proceeds of a
corporate liquidation. In addition to these, most states also have
laws pertaining to the type of corporate information to be given to
shareholders; the requirements of an annual meeting; and dissenter's
rights of appraisal for their securities in the event of a merger.
While there is general uniformity in the various state laws
concerning these requirements, investors should not assume that the
commercial laws of one state apply to another state, and should,
therefore, look up the specific laws which apply to the company in
which they own stock.
The federal securities laws also provide investors with important
recovery rights when violation of the laws occur. To enforce these
rights, shareholders must seek redress privately, either individually
or as a class, before the appropriate United States District Court.
If you have any questions concerning shareholders' rights, you may
contact the Office of Consumer Affairs and Information Services,
Securities and Exchange Commission, Washington, D.C. 20549.
COMMODORE SHAREHOLDER MOVEMENT: 6/19/93
The users of Commodore computers should be happy to learn that the
Commodore shareholders are finally taking action to solve the
company's chronic problems which have led to its current grim
financial situation. Faced with the daunting barriers of Bahamian
law and an uncooperative Board, this movement which grew out of the
concern of shareholders, developers and dealers, is actively
enlisting the aid of the Amiga-user-base to support the effort.
The Commodore Board of Directors was warned at the 1991 shareholder
meeting, "If things don't improve, Commodore will go out of
business." It's a year-and-a-half later and Commodore's value has
plummeted, largely due to lack of leadership and poor management. In
response a movement has been organized to replace the Board of
Commodore had the potential to become a 10 billion dollar-a-year
company back in 1985. Instead, they went dormant with only sporadic
attempts to generate sales. Now, Commodore is on the brink of ruin
and a community of people including shareholders, businesses and
customers have a stake in Commodore's survival. Irving Gould, the
Chairman of the Board and C.E.O. of Commodore International Limited
is the greatest barrier to Commodore's survival. Gould has eroded
the loyalty of their only reliable revenue source (the customer
base), driven Commodore into debt, and brought the company to the
edge of collapse (1993 3rd quarter disclosure).
Meanwhile, Gould has compensated himself with annual salaries of over
1.7 million dollars, plus stock options and bonuses (1992 Proxy
Statement 3). Shareholders who have already lost a great deal of
money stand to loose everything. Commodore is also the sole source
of Amiga computers, a proprietary product in which many people have
invested. These customers will be abandoned and possibly forced to
buy products less suited to their needs. A top-caliber engineering
team will be broken up, many small symbiotic companies will loose
their market, and potentially successful products will never be
The change of top-level management is believed to be Commodore's
only chance for survival. This can be accomplished through the
election of new Directors. The upcoming 1993 shareholder meeting
presents the chance to break Gould's stranglehold on the company and
to replace him with dynamic leadership. A movement to nominate and
elect new directors is being organized.
Both Irving Gould and Al Haig are up for reelection to the Board of
Directors. All shareholders should vote for the alternative
candidates who will become known in the following months. Talks are
being made with some very exciting possibile candidates. With Gould
gone, Commodore can start on its path to recovery, being led by
capable new Directors. Without Gould, the remaining Directors will
likely step down.
BUYING STOCK AND VOTING
If the shareholder movement is successful, then Commodore stock may
have been a smart investment. Many companies have come back from the
brink. The purchase of stock will allow you to cast a proxy vote in
the upcoming election, or attend the shareholder meeting (at your
own expense). In order to buy stock, contact a discount stockbroker.
There will be a transaction fee which shouldn't be over $50. Order
as many shares as you want. To expidite the proxy voting process,
ask for the stock certificate to be sent to you. Get your friends to
buy stock. Ask for it for your birthday. The process is easy and
any amount helps. Just remember the risk if the effort fails.
You'll at least have the satisfaction of being involved. Watch for
the candidates and vote!
SPREADING THE WORD
If you buy or own any Commodore stock, contact us with your address.
Send a letter or e-mail (MarcR@cup.portal.com). Let everyone who
might care know what's going on. Bring it up at the users' group
meetings and write articles for the newsletters. Re-post this
announcement. Talk about it on the electronic bulletin boards. Call
talk radio stations.
BEHIND THE MOVEMENT
You might remember the recount of events of the 1991 shareholder
meeting where shareholders warned and pleaded with Commodore to
improve and market their computers. This is the same meeting where
Irving Gould ordered the physical removal of a shareholder who
attempted to make a motion that the meeting be adjourned and
reconviened in the United States where shareholders could really
attend. The current movement has grown from that Philadelphia group,
and now includes Commodore shareholders, developers, dealers, and
users from across the country. All you have to do is buy or own
stock and contact us with your address to become a part of the
movement. Please write to us at:
Commodore Shareholder Movement
P.O. Box 8296
Philadelphia, PA 19101