March 8, 2018

“Special Meeting” Shareholder Proposals: Exclusion Still Allowed (But With a Twist)

Recently, we’ve blogged about CII’s angst over Corp Fin’s recent no-action decision allowing AES Corp to exclude a shareholder proposal on the threshold required for investors to call a special meeting.

Since then Corp Fin has followed it’s AES approach – but with a significant twist. Here’s an excerpt from this blog by Keith Higgins (also see this Cooley blog):

More requests to exclude special meeting proposals such as the one in AES Corp have come in, and the Division’s approach remains essentially the same, recently though with a significant twist. In a letter to Capital One (2/21/18), the Division agreed that the company, which proposed to ratify its existing special meeting bylaw, could omit a shareholder proposal to lower the threshold to call a shareholder meeting from 25 percent to 10 percent, provided that the company’s proxy statement discloses:

– that the company has omitted a shareholder proposal to lower the ownership threshold for calling a special meeting,
– that the company believes a vote in favor of ratification is tantamount to a vote against a proposal lowering the threshold,
– the impact on the special meeting threshold, if any, if ratification is not received, and
– the company’s expected course of action, if ratification is not received.

The Division based its conditions on Rule 14a-9, suggesting that it believes a proxy statement with a ratification proposal that does not provide the required context in which shareholders are being asked to vote for ratification would be materially misleading.

Transcript: “The Top Compensation Consultants Speak”

We have posted the transcript for the webcast: “The Top Compensation Consultants Speak.”

More on “The Mentor Blog”

We continue to post new items daily on our blog – “The Mentor Blog” – for members. Members can sign up to get that blog pushed out to them via email whenever there is a new entry by simply inputting their email address on the left side of that blog. Here are some of the latest entries:

– Who Administers Political Spending Policies?
– Energy & Utility Company Governance Issues
– E&S: Sifting Through the Raters Quagmire
– Toll-Free Numbers for Earnings Calls?
– Reg A+: Many are Called, But Few are Chosen

Broc Romanek