Twitter is a public company, which raises an issue that has often puzzled me: Why don't conservative activists use SEC Rule 14a - 8 (the so - called
shareholder proposal rule) to put proposals on corporate proxy statements?
Leila N. Sadat - Keeling, The 1983 Amendments to
Shareholder Proposal Rule 14a - 8: A Retreat from Corporate Democracy?
See also Alan R. Palmiter,
The Shareholder Proposal Rule: A Failed Experiment in Merit Regulation, 45 Ala..
I continue to oppose the use of
the shareholder proposal rule to advance a political agenda.
In recent years, however, shareholders have increasingly used SEC Exchange Act Rule 14a - 8 (the so - called
shareholder proposal rule), to not just manage but even micromanage corporate decisions.
[1] SEC Rule 14a - 8 — the so - called
shareholder proposal rule — is a central tool for accomplishing that goal.
«UCLAW seeks Assistant Dean for Experiential Education Main House Financial Choice Bill will change
the shareholder proposal rule for the better»
The SEC Division of Corporation Finance has announced guidance for companies on the application of the ordinary business exception to
the shareholder proposal rule (14a - 8 (i)(7)-RRB-:
One noteworthy corporate governance provision will work significant changes in
the shareholder proposal rule.
Absent such a standard,
the shareholder proposal rule becomes nothing less than a species of private eminent domain by which the federal government allows a small minority to appropriate someone else's property — the company is a legal person, after all, and it is the company's proxy statement at issue — for use as a soap - box to disseminate their views.
Proposal details: We note how many proposals have been filed in each category, which are now pending, how many have been withdrawn for tactical or substantive reasons after negotiated agreements with companies, and the disposition of challenges to the proposals at the Securities and Exchange Commission (SEC) under
its shareholder proposal rule.
All resolutions must conform to
the Shareholder Proposal Rule of the Securities and Exchange Act of 1934, which sets procedural as well as substantive standards for admissibility.
Not exact matches
In April, they voted in favor of a
shareholder proposal requiring annual majority
rule votes for all directors, which Nabors has said they will abide by.
Each of the other
proposals, including the election of directors (Proposal No. 1), the advisory resolution approving Apple's executive compensation (Proposal No. 3), the proposal to approve the amended and restated Apple Inc. 2014 Employee Stock Plan (Proposal No. 4), and each of the shareholder proposals (Proposals No. 5 through No. 8), are considered non-routine matters under applicab
proposals, including the election of directors (
Proposal No. 1), the advisory resolution approving Apple's executive compensation (Proposal No. 3), the proposal to approve the amended and restated Apple Inc. 2014 Employee Stock Plan (Proposal No. 4), and each of the shareholder proposals (Proposals No. 5 through No. 8), are considered non-routine matters under applicabl
Proposal No. 1), the advisory resolution approving Apple's executive compensation (
Proposal No. 3), the proposal to approve the amended and restated Apple Inc. 2014 Employee Stock Plan (Proposal No. 4), and each of the shareholder proposals (Proposals No. 5 through No. 8), are considered non-routine matters under applicabl
Proposal No. 3), the
proposal to approve the amended and restated Apple Inc. 2014 Employee Stock Plan (Proposal No. 4), and each of the shareholder proposals (Proposals No. 5 through No. 8), are considered non-routine matters under applicabl
proposal to approve the amended and restated Apple Inc. 2014 Employee Stock Plan (
Proposal No. 4), and each of the shareholder proposals (Proposals No. 5 through No. 8), are considered non-routine matters under applicabl
Proposal No. 4), and each of the
shareholder proposals (Proposals No. 5 through No. 8), are considered non-routine matters under applicab
proposals (
Proposals No. 5 through No. 8), are considered non-routine matters under applicab
Proposals No. 5 through No. 8), are considered non-routine matters under applicable
rules.
We note that, in accordance with
Rule 14 (a)-6 (a), Apple was not required to file preliminary proxy materials with the Commission because the matters to be acted on at the meeting are limited to (1) the election of directors, (2) the ratification of accountants, (3) a vote on an advisory resolution to approve executive compensation, (4) the approval of the Plan described above, which is a «plan» as defined in paragraph (a)(6)(ii) of Item 402 of Regulation S - K, and (5)
shareholder proposals pursuant to
Rule 14a - 8.
In accordance with SEC
rules, we have set forth below a
shareholder proposal, along with the supporting statement of the
shareholder proponent, for which we and our Board accept no responsibility.
Further, all
proposals submitted for inclusion in the company's proxy statement relating to the 2016 Annual
Shareholders» Meeting must comply with all of the requirements of SEC
Rule 14a - 8.
Under the NYSE
rules for member organizations: (i) the election of directors; (ii) the non-binding advisory vote to approve the compensation of the company's NEOs; (iii) the approval of the Stock Incentive Plan of 2015; and (iv) each of the
shareholder proposals described in this proxy statement are not matters on which a broker may vote without your instructions.
Proposals of
shareholders to be considered for inclusion in the proxy statement and proxy card for the 2015 Annual Meeting pursuant to
Rule 14a - 8 under the Securities Exchange Act of 1934 must be submitted in writing to the Secretary of Amazon.com, Inc., at Amazon.com, Inc., 410 Terry Avenue North, Seattle, Washington 98109, and must be received by 6:00 p.m., Pacific Time, on Thursday, December 11, 2014.
Shareholders who wish to bring business before Walmart's 2014 Annual
Shareholders» Meeting other than through a
shareholder proposal pursuant to the SEC's
rules must notify the Corporate Secretary of our company in writing and provide the information required by the provision of the Bylaws dealing with
shareholder proposals.
Shareholder proposals intended for inclusion in our proxy statement for the 2016 Annual
Shareholders» Meeting in accordance with the SEC's
Rule 14a - 8 under the Exchange Act must be received by our company in the manner described above no later than the close of business on December 24, 2015.
Section 14 and
Rule 14a - 8 under the Securities Exchange Act of 1934 govern the submission of
shareholder proposals.
The
Rule allows any
shareholder who holds $ 2,000 or 1 percent worth of a company's stock — for a period of one year — to submit a non-binding
shareholder proposal on any subject matter that they please.
I made the case for pruning the
rule in my article Revitalizing SEC Rule 14a - 8's Ordinary Business Exemption: Preventing Shareholder Micromanagement by Proposal (March 29, 20
rule in my article Revitalizing SEC
Rule 14a - 8's Ordinary Business Exemption: Preventing Shareholder Micromanagement by Proposal (March 29, 20
Rule 14a - 8's Ordinary Business Exemption: Preventing
Shareholder Micromanagement by
Proposal (March 29, 2016).
«Apple loses
Rule 14a - 8 fight to exclude
shareholder proposal requesting establishment of a human rights committee Main Francis Pileggi's 13th Annual List of Key Delaware Corporate and Commercial Decisions for 2017»
Shareholder proposals under the current SEC
rules are not burdensome, and in the vast majority of cases, are not even binding.
In my article, Revitalizing SEC
Rule 14a - 8's Ordinary Business Exemption: Preventing Shareholder Micromanagement by Proposal (March 29, 2016), available at SSRN: https://ssrn.com/abstract=2750153, I argued that shareholder use of the proposal rule should be substantially restric
Rule 14a - 8's Ordinary Business Exemption: Preventing
Shareholder Micromanagement by Proposal (March 29, 2016), available at SSRN: https://ssrn.com/abstract=2750153, I argued that shareholder use of the proposal rule should be substantially
Shareholder Micromanagement by
Proposal (March 29, 2016), available at SSRN: https://ssrn.com/abstract=2750153, I argued that shareholder use of the proposal rule should be substantially res
Proposal (March 29, 2016), available at SSRN: https://ssrn.com/abstract=2750153, I argued that
shareholder use of the proposal rule should be substantially
shareholder use of the
proposal rule should be substantially res
proposal rule should be substantially restric
rule should be substantially restricted:
Rule 14a - 8 (i)(7) is intended to permit exclusion of a
proposal that «seeks to «micro-manage» the company by probing too deeply into matters of a complex nature upon which
shareholders, as a group, would not be in a position to make an informed judgment.»
All
proposals must comply with
Rule 14a - 8 under the Exchange Act, which lists the requirements for the inclusion of
shareholder proposals in company - sponsored proxy materials.
The election of directors (
Proposal No. 1), the other proposals for the amendment of the Company's Articles (Proposal No. 2, and No. 3), the non-binding advisory resolution approving the Company's executive compensation (Proposal No. 6), the proposal to approve the Apple Inc. 2014 Employee Stock Plan (Proposal No. 7), and the five shareholder proposals (Proposals No. 8, No. 9, No. 10, No. 11, and the Floor Proposal) are considered non-routine matters under applicabl
Proposal No. 1), the other
proposals for the amendment of the Company's Articles (Proposal No. 2, and No. 3), the non-binding advisory resolution approving the Company's executive compensation (Proposal No. 6), the proposal to approve the Apple Inc. 2014 Employee Stock Plan (Proposal No. 7), and the five shareholder proposals (Proposals No. 8, No. 9, No. 10, No. 11, and the Floor Proposal) are considered non-routine matters under applicab
proposals for the amendment of the Company's Articles (
Proposal No. 2, and No. 3), the non-binding advisory resolution approving the Company's executive compensation (Proposal No. 6), the proposal to approve the Apple Inc. 2014 Employee Stock Plan (Proposal No. 7), and the five shareholder proposals (Proposals No. 8, No. 9, No. 10, No. 11, and the Floor Proposal) are considered non-routine matters under applicabl
Proposal No. 2, and No. 3), the non-binding advisory resolution approving the Company's executive compensation (
Proposal No. 6), the proposal to approve the Apple Inc. 2014 Employee Stock Plan (Proposal No. 7), and the five shareholder proposals (Proposals No. 8, No. 9, No. 10, No. 11, and the Floor Proposal) are considered non-routine matters under applicabl
Proposal No. 6), the
proposal to approve the Apple Inc. 2014 Employee Stock Plan (Proposal No. 7), and the five shareholder proposals (Proposals No. 8, No. 9, No. 10, No. 11, and the Floor Proposal) are considered non-routine matters under applicabl
proposal to approve the Apple Inc. 2014 Employee Stock Plan (
Proposal No. 7), and the five shareholder proposals (Proposals No. 8, No. 9, No. 10, No. 11, and the Floor Proposal) are considered non-routine matters under applicabl
Proposal No. 7), and the five
shareholder proposals (Proposals No. 8, No. 9, No. 10, No. 11, and the Floor Proposal) are considered non-routine matters under applicab
proposals (
Proposals No. 8, No. 9, No. 10, No. 11, and the Floor Proposal) are considered non-routine matters under applicab
Proposals No. 8, No. 9, No. 10, No. 11, and the Floor
Proposal) are considered non-routine matters under applicabl
Proposal) are considered non-routine matters under applicable
rules.
At Corpgov.net, corporate governance advocate James McRitchie quoted Gallagher as stating, «Activist investors and corporate gadflies have used these loose
rules to hijack the
shareholder proposal system.»
Referring to a draft article co-authored by Gallagher which suggests that
proposals drafted by Harvard Law School's
Shareholder Rights Project may constitute a violation of SEC
rules, Minow quotes Columbia law professor Robert Jackson, who wrote, «It is wildly inappropriate for a sitting SEC commissioner to issue a law review paper accusing a private party of violating federal securities law without any investigation or due process of any kind.
Because the SEC's
rules for resubmission of a failed
proposal by a
shareholder in the next year's proxy statement require that the
proposal have received up to 10 % of the vote (depending on how many years it has been submitted), the significant voting impact of an ISS recommendation can empower a proponent to resubmit a
proposal year after year, imposing costs on the company and creating waste and negative publicity to the detriment of the company and its
shareholders.
As you may know, the press has reported that SEC chair Mary Schapiro has directed the Commission's staff to draft
proposals for
rules governing
shareholder proxy access by mid-May 2009.
This is still a live issue today with «say on pay,» voting
rules on directors,
shareholder proposals, splitting the role of CEO and Chairman, etc..
Yet, the SEC also
ruled in March that a similar
shareholder proposal to Chevron could not be blocked and will be voted on in May.
Rule 14a - 8 (i)(7) deals with
shareholder proposals that involves certain matters fundamental to management's ability to run a company on a day - to - day basis.
Rule 14a - 8 (i)(5) deals with
shareholder proposals that relate to operations that account for less than 5 % of the company's total assets, net earnings and gross sales.