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Rea Holdings calls on Martinrea Board to respect principles of shareholder democracy and allow new Board to select CEO

  • Only new board elected at upcoming 2014 Annual Meeting should choose CEO
  • Rea Holdings concerned board is rushing CEO search as entrenchment tactic

TORONTO, April 8, 2014 /CNW/ - Rea Holdings Inc., a shareholder of Martinrea International Inc. ("Martinrea" or the "Company") (TSX: MRE), called on the board of directors of Martinrea (the "Board") to respect the principles of shareholder democracy, and allow the directors elected at the upcoming 2014 annual meeting of shareholders (the "2014 Meeting") to participate in the selection process for a new CEO for Martinrea.

In light of Rea Holdings' nomination of five highly-qualified individuals for the Board of Martinrea (the "Nominees" or the "Transform Martinrea Nominees") who intend to set a new direction for the Company, it would be inappropriate for the incumbent Board and Executive Chairman to appoint a new CEO – until shareholders have had an opportunity to voice their views at the 2014 Meeting.

Rea Holdings is deeply concerned that the Board may be undertaking a rushed CEO search designed to frustrate the will of shareholders and entrench the Board. To do so in the face of a potential change in the Board undermines the basic principles of shareholder democracy.

Rea Holdings notes that the outgoing CEO, Nick Orlando, has been retained as a consultant to the Company to provide management continuance. If elected, the Nominees themselves are well-placed to offer leadership during a time of management transition. Rea Holdings believes there is no need or value in rushing a search for a new CEO, other than tactical considerations to entrench the Board.

"The recent revelations by the Company of financial control failures, significant operational issues impacting multiple plants, and the subsequent resignation of Nick Orlando as CEO, are further evidence that the fundamental governance structures of Martinrea are broken," said Manfred Gingl, a Nominee. "The incumbent Board should not be selecting a new CEO without first heeding the will of shareholders," continued Mr. Gingl.

Rea Holdings is troubled by the notion that the Executive Chairman Rob Wildeboer, and the incumbent directors who presided over significant strategic, operational and financial issues, would be involved in selecting a new CEO for the Company.


Rea Holdings, and the Transform Martinrea Nominees have a plan to reinvigorate the Company, including a reconstitution of the board, repairing the balance sheet, improving financial and operational controls, and restoring and enhancing customer relationships.


The head office and registered address of Martinrea International is 3210 Langstaff Road, Vaughan, Ontario, L4K 5B2. The information contained in this news release does not and is not meant to constitute a solicitation of a proxy within the meaning of applicable corporate or securities laws or otherwise. Martinrea shareholders are not being asked to execute a proxy in favour of the Nominees, although Rea Holdings may file a dissident information circular (a "Dissident Circular") in due course in connection with the next annual meeting of shareholders of Martinrea and in compliance with applicable securities laws.

Notwithstanding the foregoing, Rea Holdings is voluntarily providing the disclosure required under section 9.2(4) of National Instrument 51-102 – Continuous Disclosure Obligations in accordance with securities laws applicable to public broadcast solicitations.

This news release and any solicitation made by Rea Holdings in advance of a meeting of Martinrea shareholders is, or will be, as applicable, made by Rea Holdings, and not by or on behalf of the management of Martinrea. All costs incurred for any solicitation will be borne by Rea Holdings.

Rea Holdings is not soliciting proxies in connection with a meeting of Martinrea shareholders at this time and shareholders are not being asked at this time to execute proxies in favour of the Nominees. Any proxies solicited by Rea Holdings will be solicited pursuant to a Dissident Circular sent to shareholders of Martinrea, after which solicitations may be made by or on behalf of Rea Holdings, by mail, telephone, fax, email or other electronic means, and in person by directors, officers and employees of Rea Holdings or its proxy advisor or by the Nominees.

Any proxies solicited by Rea Holdings in connection with a meeting of Martinrea shareholders may be revoked by instrument in writing by the shareholder giving the proxy or by its duly authorized officer or attorney, or in any other manner permitted by law.

Nominee Information

The table below sets out, in respect of each Nominee, his or her name, province, and country of residence, his or her principal occupation, business or employment within the five preceding years, and the number of Martinrea common shares beneficially owned, or controlled or directed, directly or indirectly, by such Nominee. None of the Nominees is currently serving as a director of Martinrea.

Name, Province, and Country of Residence1

Present Principal Occupation, Business or Employment and Principal Occupation, Business or Employment During the Preceding Five Years

Number of Common Shares Beneficially Owned or Controlled or Directed (Directly or Indirectly)

Manfred Gingl

Ontario, Canada

CEO of BionX International (2010 to present).

President, CEO, and Vice Chairman of Magna International (1966 to 2010).


Sandra Levy

Alberta, Canada

Senior Vice President of Human Resources at Ply Gem Canada (2013 to present).

Vice President, Human Resources and CPO of the Canadian National Institute for the Blind (2010 to 2013); Member of the Board of Governors of York University (2007 to 2013); Director of Human Resources at Magna International (2001 to 2010).


Roland Nimmo

Ontario, Canada

President of Nimmo Financial Corporation, a real estate advisory firm (2012 to present).

Partner at Deloitte Canada (2008 to 2012).


Nat Rea

Ontario, Canada

President of Rea Holdings (2012 to present).

Vice Chairman and Director of Martinrea (2002 to 2012).


Paul G. Smith

Ontario, Canada

Chairman of the Board of VIA Rail Canada (2010 to present); Director of StorageVault Canada (TSX: SVI) (2007 to present).

President & CEO of Equity Financial Holdings (TSX: EQI) (2009 to 2014).



1 Information set out in the above table and otherwise relating to a Nominee in this news release has been provided by each applicable Nominee of Rea Holdings.

To the knowledge of Rea Holdings, no Nominee is, at the date hereof, or has been, within 10 years before the date hereof: (a) a director, chief executive officer or chief financial officer of any company that (i) was subject to a cease trade order, an order similar to a cease trade order or an order that denied the relevant company access to any exemption under securities legislation that was in effect for a period of more than 30 consecutive days (each, an "order"), in each case that was issued while the Nominee was acting in the capacity as director, chief executive officer or chief financial officer, or (ii) was subject to an order that was issued after the Nominee ceased to be a director, chief executive officer or chief financial officer and which resulted from an event that occurred while that person was acting in the capacity as director, chief executive officer or chief financial officer; (b) a director or executive officer of any company that, while such Nominee was acting in that capacity, or within a year of such Nominee ceasing to act in that capacity, became bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency or was subject to or instituted any proceedings, arrangement or compromise with creditors or had a receiver, receiver manager or trustee appointed to hold its assets; or (c) someone who became bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency, or became subject to or instituted any proceedings, arrangement or compromise with creditors, or had a receiver, receiver manager or trustee appointed to hold the assets of such Nominee.

To the knowledge of Rea Holdings, as at the date hereof, no Nominee has been subject to: (a) any penalties or sanctions imposed by a court relating to securities legislation, or by a securities regulatory authority, or has entered into a settlement agreement with a securities regulatory authority; or (b) any other penalties or sanctions imposed by a court or regulatory body that would likely be considered important to a reasonable securityholder in deciding whether to vote for a Nominee.

None of Rea Holdings and its directors and officers, or, to the knowledge of Rea Holdings, any associates or affiliates of the foregoing, or to the knowledge of Rea Holdings, any of the Nominees or their respective associates or affiliates, has any material interest, direct or indirect, in any transaction since the commencement of Martinrea's most recently completed financial year, or in any proposed transaction which has materially affected or will materially affect Martinrea or any of its subsidiaries. None of Rea Holdings or, to its knowledge, any of its associates or affiliates, has any material interest, direct or indirect, by way of beneficial ownership of securities or otherwise, in any matter to be acted upon at an upcoming meeting of Martinrea shareholders, other than the election of directors.

Forward-looking Information

Certain information included in, or incorporated by reference into, this news release contains forward-looking statements or forward-looking information within the meaning of applicable securities laws, including, without limitation, in respect of Rea Holdings' and Martinrea's respective priorities, plans and strategies for Martinrea and Martinrea's anticipated financial and operating performance and prospects and statements relating to the ability of Rea Holdings to effect change to the board of directors of Martinrea. All statements and information, other than statements of historical fact, included in or incorporated by reference into this news release are forward-looking statements and forward-looking information, including, without limitation, statements regarding activities, events or developments that Rea Holdings expects or anticipates may occur in the future. Such forward-looking statements and information can be identified by the use of forward-looking words such as "will", "expect", "intend", "plan", "estimate", "anticipate", "believe" or "continue" or similar words and expressions or the negative thereof. There can be no assurance that the plans, intentions or expectations upon which such forward-looking statements and information are based will occur or, even if they do occur, will result in the performance, events or results expected. Forward-looking statements contained in this news release are subject to certain risks and uncertainties. Actual results may differ from those in the forward-looking statements should one or more of these risks or uncertainties materialize. Such risks include, but are not limited to, lack of cooperation from the current board and management of Martinrea regarding the conduct of a shareholders meeting and any potential actions that may be taken by the current board and management of Martinrea that could thwart any efforts to bring change to the board of Martinrea. All such factors should be considered carefully when making decisions with respect to Martinrea, and undue reliance should not be placed on Rea Holdings' forward-looking statements. The forward-looking statements and information included in this news release are made as of the date of the news release and Rea Holdings undertakes no obligation to publicly update such forward-looking statements or information to reflect new information, subsequent events or otherwise, except as required by applicable laws. Martinrea shareholders are cautioned that all forward-looking statements and information involve risks and uncertainties, including those risks and uncertainties detailed in Martinrea's continuous disclosure and other filings with applicable Canadian securities regulatory authorities, copies of which are available on the System for Electronic Document Analysis and Retrieval ("SEDAR") at www.sedar.com. The forward-looking statements and information contained in this news release are expressly qualified in their entirety by this cautionary statement.

SOURCE Rea Holdings Inc.

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