Apple Inc. Receives a Shareholder Proposal from James McRitchie
January 06, 2017 at 08:01 am
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On January 6, 2017, Apple Inc. announced that it has received a shareholder proposal from James McRitchie asking the board of directors to amend its “Proxy Access for Director Nominations” bylaw, and any other associated documents, to include essential elements for substantial implementation to better facilitate meaningful proxy access by more shareholders as follows: (1) the number of “Shareholder Nominees” eligible to appear in proxy materials shall be 25% of the directors then serving or 2, whichever is greater. Current bylaws restrict Shareholder Nominees to 20% of directors. Under the current 8-member board, shareholder nominees are currently limited to nominating one. Any shareholder nominee elected under the current bylaws could be easily isolated, (2) no limitation shall be placed on the number of shareholders that can aggregate their shares to achieve the 3% “Ownership Requirements” for “Eligible Shareholders.” Under current provisions, even if the 20 largest public pension funds were able to aggregate their shares, they would not meet the 3% criteria at most of companies examined by the Council of Institutional Investors. Allowing an unlimited number of shareholders to aggregate shares will facilitate participation by individuals and institutional investors in meeting the Ownership Requirements, and (3) no limitation shall be imposed on the re-nomination of “Shareholder Nominees” based on the number or percentage of votes received in any election. Such limitations do not facilitate the shareholders’ traditional state law rights and add unnecessary complexity.
Apple Inc. specializes in the design, manufacture and marketing of computer hardware and music supports. Net sales break down by family of products and services as follows:
- telephone products (52.1%): iPhone brand;
- peripheral devices (10.5%): screens, storage systems, printers, video camera, memory cards, server, switches, etc.;
- computers (10.2%): laptops (MacBook, MacBook Air and MacBook Pro brands) and PCs (iMac, Mac mini, Mac Pro and Xserve);
- music support (7.4%): music readers iPod and iPad and accessories;
- other (19.8%): software, maintenance service and Internet access service, etc.
Net sales are distributed geographically as follows: Americas (42.4%), China/Hong Kong/Taiwan (18.9%), Japan (6.3%), Asia/Pacific (7.7%) and Europe/India/Middle East/Africa (24.7%).