Company Name: New York Times Co.
Public Availability Date: 02-08-1993
[INQUIRY LETTER 1]
The New York Times Company
229 West 43 Street
New York, N.Y. 10036
TELEPHONE(212) 556-5995 December 07, 1992 Via Airborne Express Securities and Exchange Commission
Office of the Chief Counsel
Division of Corporation Finance
Judiciary Plaza Building
450 Fifth Street, N.W.
Washington, D.C. 20549 Re: The New York Times Company - File No. 1-5837 Ladies and Gentlemen: The New York Times Company ("The Times") has received a letter signed by Mr.
Anthony Leschin (the "Proponent"), requesting that a proposal (the "Proposal")
be included in The Times's proxy soliciting material for its 1993 Annual Meeting
of Stockholders to be held on or about April 13, 1993. A copy of Mr. Leschin's
letter and the Proposal are attached hereto as Exhibit A. The Proponent has provided The Times with evidence that he is the beneficial
owner of 100 shares of Class A Common Stock of The Times. The Proposal reads in part: "Whereas Class A shareholders do have limited voting rights which, in summary,
entitle Class A stockholders to vote for the election of 30% of the Board of
Directors, therefore, it is Recommended that each Class A shareholder shall be
informed, by the corporation, of the position on legalized abortion of such
candidates for office of Director as to enable Class A Shareholders to cast an
informed vote." Management believes that the Proposal may be omitted from the proxy soliciting
material for its next annual meeting for a number of reasons. These reasons,
among others, being that: A. The Proponent, as a holder of Class A Common Stock, is not the "owner of. . .
securities entitled to be voted on the "XADProposal"XBD at the meeting. . ." as
is required by the SEC's Rule 14a-8(a)(1). B. The Proposal is not significantly related to the business of The Times and
thus it may be omitted pursuant to the SEC's Rule 14a-8(c)(5). C. The Proposal relates to an election to office and thus may be omitted
pursuant to the SEC's Rule 14a-8(c)(8). D. The Proposal and supporting statement are vague and misleading within the
meaning of SEC's Rule 14a-9, and thus may be omitted pursuant to the SEC's Rule
14a-8(c)(3). A. Rule 14a-8(a)(1) The Times has two classes of voting stock outstanding: Class A and Class B
Common Stock. The Class A Common Stock (which is the class held by the
Proponent) has limited voting rights, which, in summary, entitle Class A
Stockholders to vote for the election of 30% of the board of directors (the
"Class A Directors"), ratification of the selection of The Times's independent
certified public accountants, certain acquisitions and the reservation of Times
stock for options to be granted to officers, directors or employees. Except as outlined above, and except as otherwise provided by the laws of the
State of New York, The Times's Certificate of Incorporation, a copy of which is
attached hereto as Exhibit B, provides that: ". . . the entire voting power shall be vested solely and exclusively in the
holders of the shares of Class B Common Stock. . . and the holders. . . of the
Class A Common Stock shall have no voting power, and shall not have the right to
participate in any meeting of the stockholders or to have notice thereof." (See Paragraph XI of Article Fourth of The Times's Certificate of
Incorporation.) As a result of these limited voting rights of the Class A Stockholders, which
are set forth in detail in Article Fourth, Paragraphs (IX) to (XII), of The
Times's Certificate of Incorporation, the holders of Class A Common Stock would
not be entitled to vote upon the Proposal in the event it were submitted to the
vote of the stockholders of The Times. Thus, the Proposal may properly be
omitted from the proxy material pursuant to paragraphs (a)(1) and (c)(3) of Rule
14a-8. Class A Stockholders of The Times (including the Proponent) have on prior
occasions sought to introduce proposals for consideration at an annual meeting
of The Times respecting matters on which they were not entitled to vote. In each
instance, the Division of Corporation Finance has agreed with The Times that
there was some basis for the view that such proposals could properly be omitted
from the proxy statement since such proponents, as holders of the Class A Common
Stock, were unable to satisfy the requirement of Rule 14a-8(a) that they must be
entitled to vote at The Times meeting on the proposals they intended to present
for action. (See the letters to The New York Times Company, available January
17, 1992, January 22, 1991, January 4, 1991, January 16, 1981, December 22,
1980, January 4, 1979, November 9, 1978, March 25, 1975 and April 1, 1974,
copies of which are attached hereto as Exhibit C). B. Rule 14a-(c)(8) The Proposal would require The Times to disclose in its proxy statements the
position on legalized abortion of each nominee for election as director. The
views of any nominee for election as director or of any director respecting
legalized abortion have nothing whatsoever to do with the business of The Times.
Thus, the Proposal deals with a matter that is not significantly related to The
Times's business and the Proposal may therefore properly be omitted from the
proxy material pursuant to paragraph (c)(5) of Rule 14a-8. In Stauffer Chemical Company (available March 1, 1974), the Commission Staff
considered an analogous proposal which would have required disclosure of
political contributions made by an issuer's officers and directors. The Staff
concluded that such proposal was not significantly related to the issuer's
business and therefore could be excluded from its proxy material, stating: "It is plain that the personal political affiliations of officers and directors.
. . are not significantly related to the company's business." Similarly, the positions of nominees for the board respecting legalized
abortion, whatever such views may be, are not significantly related (or indeed
related at all) to the business of The Times. In a letter to American Telephone & Telegraph Company (available January 4,
1979), the Staff considered a shareholder proposal which would have required
disclosure of whether nominees for election to the board had ever been
represented by, or a member or officer of, a labor organization. The Staff
(while not agreeing with the issuer's specific request) affirmed the relevance
of Rule 14a-8(c)(5) to situations such as the Proposal, stating that: "There may be instances in which the information requested in a proposal is of
so little relevance to the question of whether a nominee is qualified to be a
director that a proposal requesting that information would not be significantly
related to the issuer's business. . . ." The Times provides its shareholders with all information respecting nominees for
the board required by the Commission's proxy rules. Provision of additional
information, with no relevance whatsoever to the business of The Times or to the
duties of the directors, would serve no legitimate purpose, and thus the
Proposal may properly be omitted pursuant to Paragraph (c)(5) of Rule 14a-8. C. Rule 14a-8(c)(8) The management of The Times also believes that the Proposal may be omitted from
its proxy material on the grounds that it relates to an election to office (Rule
14a-8(c)(8)). If The Times were to implement the recommendation of the Proposal, nominees for
the Class A Directorships would be required, as a condition to their standing
for election, to publicly disclose their opinion on an extremely sensitive and
private issue. The effect of this procedure would be to impermissibly interfere
with the Class A Stockholders' right to elect directors since many qualified
individuals who would otherwise be willing to serve The Times and its
stockholders as a director would be dissuaded from standing for election. In
addition, it is not inconceivable that present Class A Directors of The Times
would opt not to stand for reelection rather than make this sensitive public
disclosure of their personal views. We note that the disclosure recommended by the Proposal could lead other special
interest groups to request nominees for directorships to disclose their church
or political affiliations, personal activities or opinions on a wide variety of
political or social issues. This could lead to the situation described in
Seibert v. Sperry Rand Corporation,
586 F.2d 949 (2d Cir. 1978), where the Court
noted: ""XADIf"XBD Sperry's proxy solicitations contain information of the sort
demanded by plaintiff concerning every outside corporation with which Sperry's
candidates were affiliated, the solicitations would swamp shareholders in an
avalanche of trivial information - a result that is hardly conducive to informed
decisionmaking." From the text of Mr. Leschin's Proposal and Supporting Statement, it appears
that his intent is to affect the election of Class A Directors in a way that
would result in The Times having Class A directors who agree with Mr. Leschin on
the issue on legalized abortion. If Mr. Leschin, or any other stockholder of The
Times, seeks to elect to the board individuals with a certain point of view on a
particular issue, they must follow the procedures under the proxy rules
respecting contested elections. Paragraph (c)(8) of Rule 14a-8 is intended to
prevent the use of the shareholder proposal provisions to by-pass the other
proxy rules that regulate such election contests. Thus, Paragraph (c)(8) of Rule
14a-8 would permit the Proposal to be omitted from The Times proxy materials. D. Rule 14a-8(c)(3) The management of The Times also believes that the Proposal may be omitted from
its proxy material on the grounds that it is vague and misleading. (Rule
14a-8(c)(3) and Rule 14a-9). Mr. Leschin cites statistics from the U.S. Statistical Abstract as to the
"population profile" presumably of the United States, though this is not stated.
Mr. Leschin asserts that such statistics demonstrate a "diminishing birth rate".
The Proposal implies that the United States has a diminishing birth rate as a
result of legalized abortion, without providing any support for the conclusions
that the birth rate is in fact diminishing or, if so, that legalized abortion is
the cause. Changes in the historic birth rate in the United States can in no way
be interpolated from a snap shot look at the present distribution of the U.S.
population by age group. In addition, such distribution is affected by numerous
factors, including life expectancy, mortality rates, immigration, emigration and
other factors. Mr. Leschin also asserts that the statistics "illustrate future economic
consequences engendered by a diminishing birth rate". The Proposal seems to
asserts that informing the holders of Class A Common Stock of the position on
legalized abortion of nominees for Class A Directorships will somehow allow such
stockholders to address Mr. Leschin's fears respecting this "diminishing birth
rate" and the resulting "future economic consequences." However, Mr. Leschin
offers no hint as to the nature of these "future economic consequences", no
support for the conclusion that a diminishing birth rate will produce them and
no indication of how his Proposal will alleviate his concerns. The Proposal has been pieced together from proposals Mr. Leschin has submitted
to other U.S. corporations where his factual assertions are used to support
proposals recommending that such corporations refrain from giving money to
organizations that support abortion. See, for example, Enron Corp. (available
February 28, 1992) and Exxon Corporation (available February 19, 1992). Mr.
Leschin's alleged facts do not have any relation to a recommendation pertaining
to disclosure of the views of nominees respecting legalized abortion. The
combination of Mr. Leschin's unsupported and questionable factual assertions,
and the irrelevance of such assertions, even if true, to the Proposal, render
the Proposal hopelessly vague and misleading. Thus, the Proposal may properly be
omitted from The Times proxy material pursuant to Rule 14a-8(c)(3). Based on the foregoing, the management of The Times believes that the Proposal
submitted by a holder of Class A Common Stock may be properly omitted from its
1993 proxy material, and intends to do so. The Times reserves the right, should
it be necessary, to present additional reasons for omitting such proposal. In accordance with Release No. 33-6269 (December 5, 1980), seven additional
copies of this letter are enclosed. In addition, copies of the letters cited
herein are enclosed. If you have any questions with respect to the foregoing,
please call me at (212) 556-5995. In addition, a copy of this letter, together with the enclosures, is being
mailed to the Proponent. Very truly yours, Laura J. Corwin Enclosures
cc: Anthony Leschin
[INQUIRY LETTER 2]
Anthony Leschin
112 West Church
Marshalltown, IA 50158 Express Mail
Next Day Service
GB604445776 US Laura J. Corwin, Secretary
The New York Times Company
229 West 43 Street
New York, N.Y. 10036 Dear Ms. Corwin: The following resolution is presented for inclusion in the 1993 Proxy. "Whereas Section 701 (Business Corporation Law) gives authority and
responsibility for profit making to the Board members and Whereas the population
profile below (US Statistical Abstract) seems to illustrate future economic
consequences engendered by a diminishing birth rate Age 45 1/1 31% (76,369,000)
Age 18-44 43.1% (106,117,000)
Age 5-17 18.4% (45,390,000)
Under 5 7.5% (18,456,000)
Whereas Class B stock is not publicly traded and is controlled by the family ".
. .to preserve the editorial independence and integrity of The New York Times"
and Whereas Class A shareholders do have limited voting rights which, in
summary, entitle Class A stockholders to vote for the election of 30% of the
Board of Directors, therefore, it is Recommended that each Class A shareholder
shall be informed, by the corporation, of the position on legalized abortion of
such candidates for office of Director as to enable Class A Shareholders to cast
an informed vote. Statement in Support: The gravity of a single family using publicly traded
shares of investors capital to support an agenda of abortion-on-demand has far
reaching implications. A media giant with no effective legal accountability can
do harm. Investors have a right to information." Enclosed proof of ownership. Yours truly, CC: SEC
[STAFF REPLY LETTER]
08 FEB 1993 RESPONSE OF THE OFFICE OF CHIEF COUNSEL
DIVISION OF CORPORATION FINANCE Re: New York Times Company (the "Company") Incoming letter dated December 7,
1992. The proposal requests additional disclosure of nominees to the Company's board
of directors. There appears to be some basis for your view that the proposal may be excluded
pursuant to rule 14a-8(c)(5). That rule permits the exclusion of a proposal that
relates to operations which account for less than 5 percent of the registrant's
total assets and is not otherwise significantly related to the registrant's
business. Accordingly, the staff will not recommend enforcement action to the
Commission if the Company omits the proposal from its proxy materials in
reliance on rule 14a-8(c)(5). In reaching a position, we have not found it
necessary to address alternative bases for omission upon which the Company
relies. Sincerely, Amy Bowerman Freed
Special Counsel
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