Carver Bancorp in New York has rejected a new attempt by activist investor Dream Chasers Capital Group to nominate candidates to the board, the latest development in a long-running governance dispute.
Carver said in a press release that Dream Chasers’ latest nomination notice failed to comply with the advance notice provisions outlined in the bank’s bylaws, preventing the activist from presenting director candidates at the upcoming annual meeting.
Carver said Dream Chasers first tried to nominate two candidates in October. After reviewing the submission with outside counsel, Carver’s board determined that the filing did not meet the procedural requirements specified in the company’s bylaws. The company said it sent Dream Chasers a letter outlining the deficiencies and the specific provisions that had not been satisfied.
More than four months later, Dream Chasers tried again, submitting a revised nomination notice on Feb. 20, just hours before the deadline.
Carver had issued a press release 30 days earlier notifying shareholders of the deadline and announcing that the annual meeting would take place on May 21. The board said the extended period between submissions provided Dream Chasers sufficient time to correct the issues identified in the first filing.
After reviewing the second submission, Carver’s board again determined that the nomination notice failed to comply with its bylaws. The company informed Dream Chasers of the deficiencies and told the investor it would not be able to present director nominees at the annual meeting because the nomination deadline had already passed.
Despite rejecting the nominations, Carver said it has repeatedly offered to engage with Dream Chasers on a potential resolution that could involve changes to board composition. Carver said that Dream Chasers has indicated it is not interested in entering discussions, though Carver said it remains open to dialogue.
The latest dispute follows a contentious proxy fight that highlighted the divide between the company’s leadership and the activist investor.
At Carver’s 2024 annual meeting, the bank narrowly prevailed after its two board candidates received slightly more votes than those backed by Dream Chasers. Less than 7,400 votes separated the second- and third-place finishers in the board race.
Dream Chasers disputed how the vote was conducted, criticizing a decision to keep voting open for an additional 45 minutes and speculating that Carver used the time to rally institutional investors. The activist said roughly 70% of Carver’s retail shareholders backed its nominees and called on the bank to appoint them to the board.
Dream Chasers has pushed the bank to sell the activist a large minority stake, arguing that doing so would allow the investor to help reshape the management team and board.
Carver has resisted those efforts, maintaining that it is acting in the best interests of the bank and its shareholders.
With Dream Chasers unable to nominate directors for the May meeting, the dispute could now shift to other avenues as the activist weighs its next steps in its campaign to influence the leadership of one of the nation’s largest Black-led banks.