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Shareholder Meeting
Dec. 14th, 2007 03:45 pmThis morning, I attended my employer's annual shareholder meeting. Actually, because of our recent financial restatement, this was our first "annual" meeting in three years. There was a lot of pent-up frustration among shareholders made even worse by the collapse in our stock price thanks to the ongoing sub-prime credit crunch.
For the most part, the meeting was orderly. The chair of the board made some opening remarks and introduced the board members present. Our COO gave his projections for the future and it isn't especially pretty: new home builds are down, resale of existing homes are down, foreclosures are up, etc, and things aren't likely to get any better until late 2009. Whee.
The treat --and horror-- of the meeting popped up fairly quickly: board meeting gadfly Evelyn Y. Davis. She may seem like a sweet grandmother in her early hundreds and on her fourth husband and might look more at home in a richly appointed Victorian mansion with 150+ cats but the world would miss her entertainment value.
The woman with 600 shares was on a roll. She urged the firing of the entire board of directors, except for her favourite and former FBI director Louis Freeh. Repeatedly she praised his past work and exclaimed how he was the only hope cleaning house in the corporation. She had something to say at every point in the meeting: accusing the board and especially our COO of being overpaid, demanding figures for how much money has been spent for legal counsel (both inside legal and outside legal), insisting we restore our reduced common share dividends, ranting against the recent preferred share offering, demanding to know how much money was given in political contributions and to whom, insisting that all mortgage applications should attend mandatory financial education because too many men were going to bars while too many women were going to hair salons, demanding to know which board members had outside board roles with other corporations and charities, and so on.
At one point, the chair pointed out that most of the information she wanted was already widely circulated and available on the company web site. This just lead to a five minute rant on how the Internet was evil and how everything should be conducted on paper alone.
She had placed a motion on the ballot to allow cumulative voting, a voting method which would make it easier to place outsiders on the board of directors. Mrs Davis was furious that her motion was fifth on the list, not fourth as she thought it should be. The positioning of her motion was, she declared, the sole result of jealousy: this is the sort of thing that only happens when women are allowed to be corporate secretary.
I was also stunned to hear her openly claim that since our corporate PAC has given $700k to misc politicians in 2006 that our firm should insist one of the recipients should immediately submit a bill to congress authorizing a financial bail-out for our company if the foreclosure mess continues any further.
Mrs Davis had some good points but they were invariably buried in ridiculous claims and outrageous statements: it was very, very hard to take her seriously on nearly anything.
In short, the institutional investors committed more than enough votes to ensure the outcome desired by the existing board: 91% in favor of the offered slate of board officers and similar margins for both confirming Deloitte Touche as our auditor and approving the proposed company stock bonus plan. Proposals for a shareholder advisory vote on executive compensation and cumulative voting were shot down, attracting only 31% and 36% respectively.
It was all over in about 2 hours. Let's do it again next year!
For the most part, the meeting was orderly. The chair of the board made some opening remarks and introduced the board members present. Our COO gave his projections for the future and it isn't especially pretty: new home builds are down, resale of existing homes are down, foreclosures are up, etc, and things aren't likely to get any better until late 2009. Whee.
The treat --and horror-- of the meeting popped up fairly quickly: board meeting gadfly Evelyn Y. Davis. She may seem like a sweet grandmother in her early hundreds and on her fourth husband and might look more at home in a richly appointed Victorian mansion with 150+ cats but the world would miss her entertainment value.
The woman with 600 shares was on a roll. She urged the firing of the entire board of directors, except for her favourite and former FBI director Louis Freeh. Repeatedly she praised his past work and exclaimed how he was the only hope cleaning house in the corporation. She had something to say at every point in the meeting: accusing the board and especially our COO of being overpaid, demanding figures for how much money has been spent for legal counsel (both inside legal and outside legal), insisting we restore our reduced common share dividends, ranting against the recent preferred share offering, demanding to know how much money was given in political contributions and to whom, insisting that all mortgage applications should attend mandatory financial education because too many men were going to bars while too many women were going to hair salons, demanding to know which board members had outside board roles with other corporations and charities, and so on.
At one point, the chair pointed out that most of the information she wanted was already widely circulated and available on the company web site. This just lead to a five minute rant on how the Internet was evil and how everything should be conducted on paper alone.
She had placed a motion on the ballot to allow cumulative voting, a voting method which would make it easier to place outsiders on the board of directors. Mrs Davis was furious that her motion was fifth on the list, not fourth as she thought it should be. The positioning of her motion was, she declared, the sole result of jealousy: this is the sort of thing that only happens when women are allowed to be corporate secretary.
I was also stunned to hear her openly claim that since our corporate PAC has given $700k to misc politicians in 2006 that our firm should insist one of the recipients should immediately submit a bill to congress authorizing a financial bail-out for our company if the foreclosure mess continues any further.
Mrs Davis had some good points but they were invariably buried in ridiculous claims and outrageous statements: it was very, very hard to take her seriously on nearly anything.
In short, the institutional investors committed more than enough votes to ensure the outcome desired by the existing board: 91% in favor of the offered slate of board officers and similar margins for both confirming Deloitte Touche as our auditor and approving the proposed company stock bonus plan. Proposals for a shareholder advisory vote on executive compensation and cumulative voting were shot down, attracting only 31% and 36% respectively.
It was all over in about 2 hours. Let's do it again next year!
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allanh