Bloomberg BNA’s Corporate Law & Accountability Report is available on the Corporate Law Resource Center. This news service keeps corporate practitioners informed of legal developments of...
By Yin Wilczek
Feb. 18 — Whole Foods Market Inc., after the withdrawal of SEC no-action relief for a shareholder-submitted proxy access resolution, has postponed its annual meeting while it ponders how to proceed.
In a Feb. 13 Form 8-K filing, the company said the annual meeting was originally scheduled for March 10.
“The Company had planned to file its definitive proxy on January 22, 2015, a date which would have ensured all applicable deadlines for the March 10, 2015 Annual Meeting were met and that a quorum was obtained,” Whole Foods said. “Given this reversal by the SEC, the postponement of the Annual Meeting is necessary to ensure the Company can meet applicable deadlines and allow the Board adequate time to review and evaluate the Company’s alternatives.”
The company said it will announce a new meeting date and related deadlines once “a final decision has been made.”
Whole Foods spokesperson Kate Lowery Feb. 18 declined to comment, saying the company did not have a statement beyond what is in its filing.
Whole Foods was the first—and thus far only—company to obtain no-action relief for a shareholder proxy access proposal under 1934 Securities Exchange Act Rule 14a-8(i)(9), which allows issuers to omit from their proxy materials shareholder proposals that directly conflict with a management resolution.
However, the Securities and Exchange Commission suspended its no-action process under the provision in January, following investor protests that numerous companies were using the provision to avoid putting shareholder-submitted access proposals to a vote.
On the same day that the SEC announced the suspension, its Division of Corporation Finance also reconsidered its position on Whole Foods' application.
Moreover, the staff announced that it will express no views on the application of Rule 14a-8(i)(9) this proxy season.
Companies that filed for no-action relief under the rule—including those on matters other than proxy access—now face a quandary as to how they should proceed with their conflicting proposals.
Some investors have indicated that they will vote against boards that act in bad faith with respect to shareholder access proposals.
Whole Foods' shareholder access resolution—submitted by activist James McRitchie—proposed giving shareholders who own at least 3 percent of the company stock for three or more years the right to list their director candidates on the company's ballot. Whole Foods' management resolution initially proposed a 9 percent/five-year threshold.
The company later unveiled a less stringent 5 percent/five-year threshold in its preliminary proxy statement filed Dec. 30.
To contact the reporter on this story: Yin Wilczek in Washington at email@example.com
To contact the editor responsible for this story: Ryan Tuck at firstname.lastname@example.org
The filing is available at http://www.sec.gov/Archives/edgar/data/865436/000110465915010409/a15-3810_18k.htm.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to email@example.com.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to firstname.lastname@example.org.
Put me on standing order
Notify me when new releases are available (no standing order will be created)