Dissident shareholders of Baltimore Bancorp say a technical victory they won yesterday bodes well for their efforts to take over the company, which operates Bank of Baltimore.
The company's annual meeting, extended from last Wednesday, was finally adjourned for good yesterday with both sides claiming victory. The tally of shareholders' votes on who should run the company will not be available for several days.
However, on the separate matter of who should count the ballots, shareholders voted 5.5 million to 4 million in favor of Corporation Trust Co., a company favored by the dissidents, led by Edwin F. Hale Sr. Management had sought to continue using Manufacturers Hanover Trust, its current transfer agent.
By itself, the issue seemed the least important of those put to the shareholders. But should the dissident group win the same 58 percent majority in the election of directors, it would have elected at least six new members to the bank's board.
But the plurality would be insufficient under current rules for the group to win control of the board of directors.That would require passage of another Hale-backed measure that would expand by 10 members the size of the 18-member board -- with Hale and 15 supporters occupying 16 of the 28 seats.
The company's bylaws require 80 percent of the voting shares to change the size of the board. The Hale group has filed a lawsuit to override the bylaws to allow a majority vote to enlarge the board. Hale's lawyers have asked the judge for a quick decision on the issue, and Hale said it could come any day.
The annual meeting began a week ago and adjourned until 11 a.m. yesterday. The session, a subdued event in the boardroom of the bank, lasted an hour and was only for voting. Several ballots, or proxies, arrived by facsimile.
Dissident stockholders have accused management of extending the voting to persuade stockholders to cast their ballots for current directors. But Baltimore Bancorp management said the Securities and Exchange Commission requested the extension to give shareholders more time to vote.
All votes received after last week's meeting are being kept separate in case the Hale group prevails in a legal challenge to the two-part meeting schedule.
"Now that the stockholders have made their views known, the bank's board should immediately stop wasting money on litigation and . . . thwarting the will of the owners," Hale said in a statement.
Chairman Harry L. Robinson left the meeting upon its adjournment and refused to answer reporters' questions.
The counting of the votes will not be completed until later this week or early next week, according to Jerome P. Baroch, senior executive vice president for Baltimore Bancorp. The count is complicated because shareholders received three separate proxy cards and were allowed to revoke previous votes.