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CALIFORNIA CORPORATE & SECURITIES LAW

California And The “Entitled To Vote” Standard

Recently, I came across a proxy statement for a California corporation that stated the vote required for shareholder action on several proposals was “the affirmative vote of the majority of the shares represented at the Annual Meeting and entitled to vote on such matter”.  While this statement was consistent with the voting standard enunciated in…

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Continuing Confusion About Shareholder Approval Requirements

I continue to read confused statements in proxy statements about the vote required for shareholder action.  The default voting rule in Delaware is found in Section 216(2) of the Delaware General Corporation Law: In all matters other than the election of directors, the affirmative vote of the majority of shares present in person or represented by…

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Those Who Hold Themselves Apart Seem To Be Getting All The Attention

Who knew that abstentions were so newsworthy?  Here are three recent news stories involving abstentions at annual meetings: Warren Buffett Defends Coca-Cola Abstention at Berkshire Meeting (May 3, 2014) CalPERS Shareowner Proposal Successful at Nabors Industries (June 3, 2014) Cheniere CEO Risks Losing $133 Million Amid Investor Suit (June 9, 2014) CalPERS’ shareholder proposal seems confused, misleading and internally…

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What Good Can Come From Letting The Indifferent and Undecided Hold Sway?

I’ve written many posts on the subject of voting because it seems so straightforward and yet turns out to be complex.  In tackling any voting problem, it is important to know and understand the applicable voting rule.  An example of a voting rule can be found in Section 708(c) of the California Corporations Code which prescribes the…

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On Closer Inspection, This CII “Best Practice” May Be Neither Good Nor Legal

The Council of Institutional Investors has adopted what it describes as “a comprehensive body of corporate governance best practices”, including Policies on Corporate Governance.  I question, however, whether some of these policies really are “best practices” or even in conformity with applicable law. For example, the Section 3.7 of the CII’s Policies on Corporate Governance unequivocally, and without…

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ISS Thinks Only Those Who Vote “No” Have A View

ISS Calls For Comments The ISS Global Policy Board is inviting comments on its benchmark proxy voting guidelines.  The comment period has been extended to November 7, 2011.  Here is a listing of the policies changes put out for comment. Today, I want to comment on ISS’ approach to Board responses to management say-on-pay (MSOP) votes.  ISS…

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