Orion Properties Declares Kawa Fund’s Director Nomination Attempt Invalid Due to Bylaw Non-Compliance
Orion Properties, today delivered a decisive announcement regarding the activist efforts of The Kawa Fund Limited. The Company stated that the notice submitted by Kawa, which purported to nominate five candidates to stand for election to Orion’s Board of Directors at the upcoming 2026 annual meeting, has been formally declared invalid. This unanimous determination by Orion’s Board of Directors stems from Kawa’s failure to meet several mandatory requirements explicitly set forth in the Company’s governing bylaws.
Failure to Meet Fundamental Bylaw Requirements
The core of the Board’s decision rests on Kawa’s non-compliance with fundamental procedural and disclosure protections designed to ensure the integrity and orderliness of the director election process. The Board’s review highlighted a primary deficiency: Kawa failed to satisfy the requirement that a nominating party must be a record holder of the Company’s common stock. This status, a foundational element of Orion’s nomination procedure, was not sufficiently demonstrated by the submitted notice.
Beyond the critical failure to prove eligible stockholder status, the Board identified several other material omissions and deficiencies in Kawa’s submission. The full statement issued by the Board underscored the necessity of adhering to established governance guidelines:
“Orion’s bylaws provide a clear procedure for investors to nominate candidates for election to Orion’s Board of Directors. Kawa, however, failed to provide proof that they are an eligible stockholder. In addition, Kawa’s nomination notice does not comply with several other requirements of Orion’s bylaws.”
Inadequate Disclosure of Strategic Intent
A significant secondary reason for the invalidation involves the inadequacy of Kawa’s disclosed plans for the Company. Orion’s bylaws require nominating stockholders to provide comprehensive details regarding their proposals and strategy for the Company, allowing all stockholders to make an informed decision about the nominees. The Board noted that Kawa’s nomination notice lacked this crucial strategic discussion, offering only a brief and insufficient reference to Kawa’s two prior, unsolicited proposals to acquire all of the outstanding shares of Orion’s common stock.
This lack of strategic clarity was seen as a substantial failure to meet the required disclosure standards, preventing the Board and, ultimately, the broader stockholder base from understanding the nominees’ platform and potential impact on the Company’s direction.
Enforcing Procedural Integrity for All Stockholders
The Orion Board emphasized that the enforcement of these procedural rules is not arbitrary but rather a necessary act of fiduciary duty to protect the interests of all stockholders. The Board reinforced that the Company’s bylaws are clear, established, and publicly available, ensuring that all investors have access to the same nomination procedures.
“Orion’s bylaws contain common procedural and disclosure protections to ensure the orderly exercise of stockholder rights and the integrity of director elections. The requirements are clearly stated in the bylaws, have been in place for several years, and have been publicly available at all times. Orion’s Board of Directors, acting as fiduciaries on behalf of all Orion stockholders, will enforce those procedures to ensure an orderly and informed vote,” the Board stated.
By upholding these long-standing rules, the Board aims to ensure that any future election is conducted on a level playing field, where only qualified candidates presented by fully compliant, eligible stockholders can stand for election.
Commitment to Long-Term Value and Ongoing Engagement
Despite the rejection of the nomination notice, Orion’s Board reiterated its unwavering commitment to creating long-term value for all stockholders and affirmed its willingness to engage with the investment community, including Kawa, on matters of strategy, performance, and business priorities.
The Board’s statement concluded by reaffirming its dedication to the Company’s strategic direction: “Orion’s Board of Directors and management team are committed to creating long-term value for all stockholders and will continue to take actions to achieve that objective. The Company engages with the investment community about the Company’s strategy, performance and business priorities and will continue to do so, including engaging in ongoing communications with Kawa.”
Because The Kawa Fund Limited failed to deliver a notice that complies with Orion’s bylaws requirements prior to the established nomination deadline, the Company formally concluded that Kawa is not entitled to nominate any candidates for election to the Board at the 2026 Annual Meeting.
Orion Properties will proceed with the normal governance cycle, announcing the official date of the 2026 Annual Meeting and filing the definitive proxy materials with the U.S. Securities and Exchange Commission (SEC) in due course. The Company advised its stockholders that no action is required on their part at this time. The invalidation of Kawa’s notice effectively closes the door on the immediate challenge to the Board composition for the upcoming annual meeting.
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