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with petitioners, then Mr. Vajna was in a position to control or
prevent any income distribution that would or could be made by
CIBV. The Nestor arrangement might thus be construed to do no
more than artificially or formally decrease petitioners’ actual
interest in CIBV’s receipts.
Furthermore, the language of the proxies used to describe
the rights granted to the proxy holder is extremely broad. The
terms certainly encompass more than voting power and do not
foreclose an interpretation that would include the right to
income distributions. In this connection, we note that the
broad, irrevocable, presently operative nature of these proxies
renders unpersuasive petitioners’ attempts to find an analog in
the limited agency conveyed by a typical voting proxy or the
prospective rights represented by a mere option.
Accordingly, we believe that there exists colorable support,
particularly in the proxy documents, that renders respondent’s
position more than a “fishing expedition”.
B. Absence of Undue Prejudice
We must next weigh the possible prejudice to petitioners
that could be caused by even a potentially meritorious argument.
Although we are sympathetic to petitioners’ protests regarding
the large increase in deficiency, we find these concerns to be
mitigated by at least two principal factors: (1) The centrality
of Nestor’s role to a complete and accurate resolution of the
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