Blog Posts Tagged With Proxy Season

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Criticism of Governance Provisions in Proxy Contest Leads to Reincorporation

Among the settlement terms in the proxy contest between Arconic Inc. and Elliot Management is an agreement to reincorporate to Delaware due to the corporate governance provisions in the company’s charter.

As the surviving company of Alcoa Inc., which spun off parts of its business into a new entity called Alcoa Corp., the renamed Arconic was governed under a charter that staggered board elections and required 80% of outstanding shares to amend the terms for fair price protection, change the classified board or remove its directors. About eight years ago, shareholder proposals favored by a majority of the votes cast asked the board to amend those provisions. Continue Reading

Two Quick Reminders for the Proxy Season

As many of you prepare to file your proxy statements this month, two quick reminders on new developments to keep in mind:

  • There is no longer a requirement to send the SEC hard copies of the company’s annual report that accompanies the proxy statement if you post the report on the company’s website, and keep the report on the website for at least a year.  See our prior post on the CDI issued in November of last year.
  • Companies including a say-on-frequency vote in their proxy statements should remember to announce publicly the board’s decision on the frequency selected after the meeting. 
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2017 Proxy Statement Reminders

While several major SEC disclosure requirements remain in the proposal stage and the pay ratio disclosure does not come into play until the proxy statement for 2018 meetings, companies should be aware of a few new items for the 2017 proxy statement:

  • Audit Committee Communications with Auditors.  Item 407 of Regulation S-K requires the audit committee report to state whether the committee has discussed with the independent auditors the matters required to be discussed by the statement on Auditing Standards No. 61, as amended (AICPA, Professional Standards, Vol. 1. AU section 380), as adopted by the Public Company Accounting Oversight Board in Rule 3200T.
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A Look at Retail Shareholders and Other Results from the 2016 Proxy Season

73% of the shareholders at large-cap companies and 77% of those at mid-cap companies are institutional investors, according to the latest edition of ProxyPulse, a joint publication by Broadridge and PwC that examined 4,200 annual meetings held between January 1 and June 30, 2016. But retail investors play an important role in contested issues, and they tend to side with the company. During the 2016 proxy season, only 15% of retail shareholders supported proxy access shareholder proposals compared to 60% of the institutions that voted.

An analysis of retail shareholders found some interesting differences relative to the U.S. population. Only 20% are less than 40 years of age compared to 31% of the overall population, and 22% have graduate degrees, 11% more than U.S. Continue Reading

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