Company Name: AT&T Corp.
Public Availability Date: January 16, 2004
Document Sections:
INQUIRY LETTER
INQUIRY LETTER
INQUIRY LETTER
INQUIRY LETTER
STAFF REPLY LETTER
[INQUIRY LETTER]
December 22, 2003
Securities and Exchange Commission
Office of Chief Counsel
Division of Corporation Finance
450 Fifth Street, N.W.
Washington, D.C. 20549
Re: AT&T Corp. Shareholder Proposal Submitted by Mary F. Morse Family Trust Rule
14a-8/Securities Exchange Act of 1934
Dear Ladies and Gentlemen:
Pursuant to Rule 14a-8(j) of the Securities Exchange Act of 1934, as amended,
AT&T Corp. ("AT&T" or the "Company") hereby gives notice of its intention to
omit from its proxy statement and form of proxy for the Company's 2004 Annual
Meeting of Shareowners (collectively the "Proxy Materials") a proposal and
supporting statement (the "Proposal") submitted by the Mary F. Morse Family
Trust (the "Proponent") by letter dated September 16, 2003 and received by the
Company on September 25, 2003. Enclosed herewith are six (6) copies of the
Proposal.
AT&T requests the concurrence of the staff of the Division of Corporation
Finance (the "Staff") that no enforcement action will be recommended if AT&T
omits the Proposal from its Proxy Materials.
The Proposal requests that "Management and Directors are requested to consider
discontinuing all rights, options, SAR's. [sic] and possible severancepayments
to top 5 of Management after the expiration of existing plans or commitments.
This does not apply to plans for lesser Managers or employees whom[sic] are
offered reasonable employee options or bonuses."
AT&T has concluded that the Proposal may be properly omitted from its Proxy
Materials pursuant to the provisions of Rule 14a-8(b) and Rule 14a-8(f)(1).
The specific reasons why the Company deems omission to be proper and the legal
support for such conclusion are discussed below.
THE PROPOSAL MAY BE OMITTED UNDER RULE 14a-8(b) and RULE 14a-8(f)(1) IF THE
PROPONENT IS NOT A RECORD OR BENEFICIAL OWNER OF A LEAST 1% OR $2,000 IN MARKET
VALUE OF SECURITIES ENTITLED FOR VOTE
Under Rule 14a-8(b)(1), the Proponent shall be a record or beneficial owner of
at least 1% or $2,000 in market value of securities entitled to be voted on the
Proposal at the meeting and have held such securities for at least one year and
shall continue to own such securities through the date on which the meeting is
held. The Company notified Proponent of this procedural requirement in a letter
(see attached) dated October 6, 2003 (sent within 14 calendar days after
receiving the Proposal on September 25, 2003) advising the Proponent that "the
SEC rule requires that the proponent of a proposal be a record or beneficial
owner and have continuously held at least $2,000 in market value, or 1% of the
company's securities entitled to be voted on the proposal at the meeting for at
least one year by the date you submit the proposal". On October 7, 2003,
Proponent received the Company's letter (see attached FedEx receipt bearing the
signature of Robert D. Morse on behalf of the Mary F. Morse Trust). AT&T
received a written response1 from the Proponent postmarked October 27, 2003,
which was 20 days after the documented receipt of AT&T's letter and therefore
not within the 14 days required by the Rule. In the response, Proponent stated
the following, "New Date:10-27-03 Note: Away 2 weeks - not supplifb[sic] as of
my return Oct 25, 03". To the extent this cryptic notation could be construed as
attempting to establish a later date of receipt of the Company's letter, it
conflicts with and is refuted by the documented receipt of the Company's letter
on October 7, 2003. Proponent also included a copy of an account statement from
TD Waterhouse dated January 31, 2003 reflecting the ownership by the Mary F.
Morse Trust of 205 shares of the Company's common stock on that date along with
a copy of a trade confirmation from Quick & Reilly, Inc. for the purchase by
Mary F. Morse of 200 shares2 of the Company's securities in 1984. The
affirmative written statement from TD Waterhouse as the record holder of the
securities required by Rule 14a-8(b)(2)(i) indicating that the Proponent
continuously owned the Company's securities for a period of one year as of the
time of the submission of the Proposal was not included. In its letter,
Proponent characterized this requirement as an "imposition" on TD Waterhouse, a
"pitiful source of discouragement" to proponents and "a nitpicking [demand] of
some corporations legal departments." In any event, however, the January 2003
brokerage statement provides no evidence as to whether the Proponent owned any
AT&T securities at the time it submitted the Proposal. The 1984 trade
confirmation, relating to a different and inadequate number of shares in a
different brokerage account with a different registration, provides no evidence
whatsoever of any continuity of ownership by the Proponent. Therefore, the
Proponent, in addition to responding late, has both failed to satisfy the proof
of ownership Rule or provide any other probative evidence of ownership.
According to Division of Corporate Finance, Securities and Exchange Commission,
Staff Legal Bulletin No. 14, July 13, 2001, p. 13, "A shareholder must submit an
affirmative written statement from the record holder that the shareholder
continuously owned the securities for a period of one year as of the time the
shareholder submits the proposal." In view of the fact that the Proponent (i)
failed to respond to the Company's letter within the 14 days required by the
Rule, and (ii) failed to include in Proponent's response the affirmativewritten
statement from the record owner and proof of continuous ownership required by
the Rule, the Proposal may be excluded under Rule 14a-8(b) and Rule 14a-8(f)(1).
See Telular Corp., November 26, 2003, SBC Communications Inc., January 23, 2002
and AT&T Corp., March 6, 2001.
Based on the foregoing, the Company hereby respectfully requests that the Staff
agree that it will not recommend any enforcement action if the Proposal is in
fact excluded from the Company's 2004 Proxy Materials under Rule 14a-8(b) and
Rule 14a-8(f)(1).
Pursuant to Rule 14a-8(j)(1), the Company, by copy of this letter, is notifying
the Proponent of its intention to omit the Proposal from the Proxy Materials.
Should you have any questions or comments regarding the foregoing, please
contact the undersigned at (908) 532-1901. Please acknowledge receipt of this
letter and enclosures by stamping the enclosed additional copy of this letter.
We appreciate your attention to this request.
Very truly yours,
/s/
John W. Thomson
Enclosures
-----FOOTNOTES-----
1 It was noted in the letter that the response was prepared and typed by Robert
D. Morse, husband of Mary F. Morse.
2 The purchase of 200 shares in 1984 would equate, after adjustment for stock
splits and reverse stock splits, to ownership of 60 shares today which would not
equal $2,000 in value of the Company's securities.
[INQUIRY LETTER]
September 16, 2003
Office Of The Secretary
AT&T Corporation
205 North Maple Avemue
Basking Ridge, NJ 07920
Dear Secretary:
I, Mary F. Morse, of 212 Highland Avenue, Moorestown, NJ 08057-2717, holder of
over $2000.00 value in Company stock over one year, wish to enter the following
proposal for the Year 2004 Proxy Material. I intend to hold stock until beyond
the meeting, as required, and to be represented at the Meeting, as required..
PROPOSAL
Management and Directors are requested to consider discontinuing all rights,
options, SAR's. and possible severance payments to top 5 of Management after
expiration of existing plans or commitments. This does not apply to plans for
lesser Managers or employees whom are offered reasonable employee options or
bonuses.
REASONING:
Moderation is needed in corporate remuneration. Any person can live very
lavishly on $500.000.00 per year. Over-paying Management has been ongoing and
increasing for years. Many officials have been awarded with no mention of what
was accomplished above and beyond expectation of their positions. The bookwork
involved and expense is tremendous in carrying out these programs. Peer group
comparison and commercial "Remuneration" entities have been employed by some to
recommend payouts, having nothing to do with a performance record. The product,
its advertising, and its acceptance usually govern earnings.
When Management is hired for their position at a good salary, they are expected
to earn it, and not have to be paid more when and if they do. Excess wealth
passed on may make heirs non-workers, or non-achievers and of little use in our
society.
There are many good Management Training Schools in the United States and the
supply is available. Hiring away from other corporations is a predatory process,
increases costs and does not necessarily "align shareowner/management
relations", with any gain to the shareowners. Think about it! Vote YES for this
proposal, it is your gain.
Thank You, and please yote YES for this Proposal.
/s/
Mary F. Morse
[INQUIRY LETTER]
September 16, 2003
Office Of The Secretary
AT&T Corporation
205 North Maple Avemue
Basking Ridge, NJ 07920
Dear Secretary:
I find it necessary to rephrase my Proposal and Reasoning, due to
mis-under-tanding that I only have one Proposal, the other wording, offering
information to Shareowners does become confusing and does not conform to the
Proposal.
Should the new format still need explaining, please contact me; first class mail
is timely, or by e-mail There is ample time prior to printing the Proxy
Material..
My contention that attendance to present at meeting is discriminatory, compared
to Management's use of Company assets to attend. Pre-meeting request and
response for a vote will not materially change such by a forced attendance to
comply with S.E.C. inappropriate Rules.
Thank you for your interest.
/s/
Mary F. Morse, Trustee
[INQUIRY LETTER]
December 29, 2003
Re: AT&T Letter to SEC dated !2/22/03 Signed by Joseph P. Gallagher
Securities & Exchange Commission
Division of Corporate Finance
Office of the Chief Counsel
450 Fifth Street, N.W.
Washington, DC 20549
Ladies and Gentlemen:
I received copy of a submission to your office from above noted AT&T
representative. It is accompanied with various exhibit items of their and my
production and 3 very repetitive and unneeded exhibit items of 13 pages "Teleular
Corporation", 9 pages SBC Communications, Inc. and 14 pages AT&T re: George
Dermksian correspondence to the S.E.C.
This is definitely "Overkill" in a presentation to delete, and I have
experienced it before. A 1/4 inch thick mass of repetitive argument wording is
contrary to The Paperwork Reduction Act of 1995, which itself contains an
amazing 26 pages. {Page One Copy Enclosed as Exhibit]
It is my and my husband's opinion the entire situation for blame falls on the
S.E.C. for allowing its "Promulgated" procedure Rules to be influenced by
lobbyists working for Corporate interests to discourage presentation of
Proposals.
It is an imposition to require a non-interested third party entity to provide a
non-paying "Proof of Ownership" of $2000.00 of stock for at least one year, and
to still hold same for each request from a Corporation intent on deleting a
Proposal. As I earlier stated, this is "nit-picking" and not a good Corporate
behavior.
In this particular case, my husband saw fit to dispose of his retirement
investment in AT&T after 15 years or so when it dropped from an over $50.00 high
to $27.00 and is hovering about $18.00 to $20.00 for some time now. I also
transferred my certificate[s] to T.D. Waterhouse at the same time and are still
in street name, but did not sell. TD Waterhouse has no record of purchase date
of the stock bought from another broker and cannot furnish proof and should not
be expected to comply after a third request re: other purchase proofs we have
requested to fill an unwarranted demand.
Specifically, the letter dated October 9, 2003 [exhibited by, and to: Joseph P.
Gallagher, Staff Mgr. AT&T], was predated and left on a table ready to be mailed
by my son, as we were visiting in the West. The letter mentioned in the fourth
paragraph as "enclosed" never arrived from TD Waterhouse, and the letter was
mailed without the enclosure. TD Waterhouse is not to be faulted, as it is an
imposition to make such a request they cannot or care not to comply with.
Perhaps the answer to this ongoing predicament is to have the Corporation prove
that a proponent has misstated ownership, and thereby be barred from further
presentations.
Further, if I have an acceptable purchase receipt proof and a copy of a
certificate, how would one know whether or not I had disposed of same after
presentation of ownership?
It is requested that my Proposal be permitted to appear in Year 2004 AT&T Proxy.
6 copies to SEC
1 copy to AT&T
Enclosures
Sincerely,
/s/
Mary F. Morse, Trustee
This material prepared by my husband, Since I neither type nor use a computer.
Time element is noticed: Last Oct.6th to date of Dec. 22\nd/ for pre-holiday
delivery, to be disruptive? Then, hurry response.
[STAFF REPLY LETTER]
January 16, 2004
Response of the Office of Chief Counsel Division of Corporation Finance
Re: AT&T Corp. Incoming letter dated December 22, 2003
The proposal relates to discontinuing all rights, options, SARs and possible
severance payments.
There appears to be some basis for your view that AT&T may exclude the proposal
under rule 14a-8(f). We note that the proponent appears to have failed to
supply, within 14 days of receipt of AT&T's request, documentary support
sufficiently evidencing that it satisfied the minimum ownership requirement for
the one-year period as of the date that it submitted the proposal as required by
rule 14a-8(b). We further note, however, that AT&T failed to inform the
proponent of what would constitute appropriate documentation under rule 14a-8(b)
in AT&T's request for additional information from the proponent. Accordingly,
unless the proponent provides AT&T with appropriate documentary support of
ownership, within seven calendar days after receiving this letter, we will not
recommend enforcement action to the Commission if AT&T omits the proposal from
its proxy materials in reliance on rules 14a-8(b) and 14a-8(f).
Sincerely,
/s/
Keir D. Gumbs
Special Counsel
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