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MCG reaches settlement, avoids proxy contest with shareholder group
By Lisa Kerner
Charlotte, N.C., April 28 - MCG Capital Corp. said it has reached an agreement with a shareholder group in connection with the company's 2009 annual meeting on June 17.
The shareholder group owns approximately 9.9% of MCG's outstanding shares and includes Springbok Capital Management, LLC, Soundpost Partners, LP and Lyrical Partners, LP, an MCG news release said.
MCG said it will appoint Springbok managing member Gavin Saitowitz to its board of directors effective Thursday and will also nominate Saitowitz to hold a director position until the 2012 annual meeting.
Current directors A. Hugh Ewing III and Kenneth J. O'Keefe will also be nominated at the 2009 meeting to be directors until the 2012 annual meeting, MCG said.
Jeffrey M. Bucher, a current MCG director, resigned from the board effective Thursday, reducing the board to eight directors.
The shareholder group agreed not to solicit proxies in connection with the 2009 annual meeting and to vote its shares in support of all of the board's director nominees and the company's proposals at the meeting.
In addition, the shareholder group agreed to a broad standstill agreement through MCG's 2010 annual meeting.
MCG said all pending litigation between MCG and the shareholder group will be dismissed as part of the agreement.
"This agreement will enable MCG to avoid a costly and disruptive proxy contest during a critical time as we focus on creating stockholder value in a challenging and unprecedented environment," MCG chairman Richard W. Neu said in the release.
MCG is an Arlington, Va.-based commercial finance company specializing in middle-market companies.
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