Company Name: Tidewater Inc.
Public Availability Date: March 26, 2004
Document Sections: INQUIRY LETTER
APPENDIX
INQUIRY LETTER
STAFF REPLY LETTER [INQUIRY LETTER]
March 10, 2004 Securities and Exchange Commission
Division of Corporation Finance
Office of Chief Counsel
450 Fifth Street, N.W.
Washington, D.C. 20549 Re: Tidewater Inc.
Stockholder Proposal Submitted by Harold J. Mathis, Jr.
Ladies and Gentlemen: We are counsel to Tidewater Inc., a Delaware corporation ("Tidewater" or the
"Company"). On November 11, 2003, Tidewater received a proposed stockholder
resolution and supporting statement (together, the "Proposal") from Harold J.
Mathis, Jr. (the "Proponent" or "Mr. Mathis") for inclusion in the Company's
2004 proxy statement (the "2004 Proxy Statement") to be provided to the
Company's stockholders in connection with its 2004 Annual Meeting. For the
reasons set forth below, we believe that the Proposal and its supporting
statement contain materially false and misleading statements and therefore may
be excluded from the Company's 2004 Proxy Statement pursuant to Rule 14a-8(i)(3)
of the Securities Exchange Act of 1934, as amended. The Company requests that the staff of the Division of Corporation Finance (the
"Staff") confirm that it will not recommend any enforcement action to the
Securities and Exchange Commission (the "Commission") if the Company excludes
the Proposal from its 2004 Proxy Statement for the reasons set forth below.
In accordance with Rule 14a-8(j), we are enclosing six copies of this letter and
the Proposal, attached hereto as Exhibit A. In conformity with the Rule, we are
also simultaneously providing a copy of this submission to the Proponent.
TEXT OF THE PROPOSAL AND SUPPORTING STATEMENT
The Proposal submitted by Mr. Mathis calls for the declassification of
Tidewater's Board of Directors. The text of the Proposal is as follows:
"RESOLVED: That the stockholders of Tidewater, Inc., assembled in annual meeting
in person or by proxy, hereby request that the Board of Directors take the
needed steps to provide that at future elections of directors new directors be
elected annually and not by classes, as is now provided, and that on expiration
of present terms of directors their subsequent elections shall also be on an
annual basis. REASONS It is the proponent's belief that classification of the Board of Directors is
not in the best interest of Tidewater Inc. and its shareholders. This proponent
also believes that it makes a Board less accountable to shareholders when all
directors do not stand for election each year; the piecemeal election insulating
directors and senior management from the impact of poor performance.
The Council of Institutional Investors' (www.cii.org) Shareholders Bill of
Rights recommends: 1) Annual Election of all directors
2) Adoption of shareholder resolutions that receive a majority of votes cast.
In fact, a vast number of companies listed on the NYSE elect all directors each
year. The WALL STREET JOURNAL reports that:
"Weak Boardrooms and Weak Stocks Go Hand in Hand"
September 9, 2003 Classified boards are rapidly becoming a thing of the past as more companies
demonstrate a greater commitment to the principles of corporate democracy,
adhering to policies that maximize accountability to shareholders.
Why should Tidewater Inc. shareholders continue the piecemeal approach of
waiting three years to complete their evaluation of the entire Board?
REGISTER YOUR VIEWS ON THE TOTAL BOARD'S PERFORMANCE EACH YEAR.
Protect you investment through better corporate governance and board
accountability. Vote YES to evaluate director performance each year." [End of Supporting Statement]
As discussed in detail below, there are numerous statements in the Proposal's
supporting statement that are materially false and misleading in violation of
Exchange Act Rule 14a-9. GROUNDS FOR EXCLUSION
Exchange Act Rule 14a-8(i)(3) permits a company to exclude a stockholder
proposal from its proxy solicitation materials "if the proposal or the
supporting statement is contrary to any of the Commission's proxy rules,
including Rule 14a-9, which prohibits materially false or misleading statements
in proxy soliciting materials." This includes any portion or portions of a
proposal or supporting statement that, among other things, contain false or
misleading statements, inappropriately cast the proponent's opinions as
statements of fact, or otherwise fail to appropriately document assertions of
fact. See The Dow Chemical Company (March 17, 2003); Alaska Air Group, Inc.
(March 14, 2003); The Home Depot, Inc. (March 4, 2003); The Boeing Company (Feb.
18, 2003); Weyerhaeuser Company (Jan. 21, 2003); Staff Legal Bulletin No. 14
(July 13, 2001) (where the Staff states that shareholders should provide factual
support for statements in the proposal and supporting statements or identify
statements as their opinion where appropriate). The Staff has concurred that a company may properly exclude entire stockholder
proposals and supporting statements if they contain false and misleading
statements or omit material facts necessary to make such statements not false
and misleading. See The Swiss Helvetia Fund, Inc. (April 3, 2001) and General
Magic. Inc. (May 1, 2000). In addition, as stated by the Staff in Staff Legal
Bulletin No. 14 (July 13, 2001), "when a proposal and supporting statement will
require detailed and extensive editing in order to bring it into compliance with
the proxy rules, we may find it appropriate for companies to exclude the entire
proposal, supporting statement, or both, as materially false or misleading."
As discussed below, the Proposal is replete with statements and assertions that
are false and misleading, the correction of which would require detailed and
extensive editing; accordingly, the Company believes the entire Proposal is in
violation of Rule 14a-9, and therefore may properly be excluded in its entirety
pursuant to Rule 14a-8(i)(3). The Company believes that the following portions of the Proposal's supporting
statements are false and misleading. 1. In the first paragraph of the Proponent's supporting statement, the Proponent
states in part: "This proponent also believes that it makes a Board less
accountable to shareholders when all directors do not stand for election each
year; the piecemeal election insulating directors and senior management from the
impact of poor performance." This statement is properly excludable under Rule 14a-9 because it contains
misleading information and impugns the integrity of Tidewater's management and
its Board of Directors. Although the statement is couched as the Proponent's
opinion, the statement suggests that Tidewater's Board of Directors is not
currently accountable to its stockholders. The statement also suggests that
Tidewater's management and its Board of Directors are performing poorly and that
the poor performance is being shielded by the classified board structure. This
impugning of the reputation of Tidewater's management and its Board of Directors
is clearly impermissible under Exchange Act Rule 14a-9. See Note (b) to Exchange
Act Rule 14a-9 (stating that material "which directly or indirectly impugns
character, integrity or personal reputation" may be misleading under Exchange
Act Rule 14a-9); The Boeing Company (February 26, 2003) (permitting the deletion
of two paragraphs in response to company's argument that they were
inflammatory); Maytag Corporation (March 14, 2002) (permitting deletion of
certain statements that malign management); Raytheon Company (March 13, 2002)
(same). Even with a classified board, one-third of the board members are up for
election each year, and Tidewater's stockholders have at all times the power to
make substantial changes to the Board's composition through the proxy machinery
if they choose to do so. Notwithstanding this capability, at no time in the last
15 years have the stockholders made any attempt to wage a proxy contest or
withheld voting authority in any appreciable amount with respect to the slate of
nominees proposed by the Board. It is misleading and completely unfounded to
claim that a classified board is any less accountable to the company's
stockholders than a non-classified board. It is also misleading to suggest that
there is a proven correlation between the classified board structure and poor
performance. 2. In the second paragraph of the Proponent's supporting statement, the
Proponent states: "The Council of Institutional Investors' (www.cii.org)
Shareholders Bill of Rights recommends: 1) Annual Election of all directors
2) Adoption of shareholder resolutions that receive a majority of votes cast."
This statement is properly excludable because it contains false information,
omits material information, and is misleading. First, the Proponent references
the Council's "Shareholders Bill of Rights" as the source for the statement, and
directs the Company's stockholders to the Council's website at www.cii.org. The
Council's website does not reference or contain a "Shareholders Bill of Rights",
as described by the Proponent. Rather, the Council's recommendations cited by
the Proponent appear under the heading "Council Policies - The Board of
Directors", and are only two of eleven policies addressed by the Council.
Second, the statement fails to disclose that the Council itself, on its website,
has specifically stated that its guidelines bind neither its members nor
corporations, and that they are designed to be guidelines that the Council has
found to be appropriate in most situations. As such, they are broad-based
generic recommendations only and do not take into account specific information
regarding the Company, its governing documents, and Delaware law. The
Proponent's failure to accurately portray the full position of the Council may
lead Tidewater's stockholders to believe that the Council's recommendations are
specific to Tidewater, when they clearly are not. See The Boeing Company
(February 11, 2004) (requiring the proponent to revise the supporting statement
to make clear that the Council's recommendation relates to proposals generally
and not the proponent's specific proposal). The Proponent's statement therefore
contains false information and omits other material information in contravention
of Rule 14a-9. Further, the Commission previously has found that references to internet
addresses and/or websites are excludable and may be omitted from proposals or
supporting statements if the information contained in such website "may be
materially false or misleading, irrelevant to the subject matter of the proposal
or otherwise in contravention of the proxy rules." Staff Legal Bulletin No. 14
(July 13, 2001). See AMR Corporation (April 3, 2001) (requiring the proponent to
delete the same website address included in the Proposal); The Emerging Germany
Fund, Inc. (December 22, 1998); Templeton Dragon Fund, Inc. (June 15, 1998). It
is appropriate to exclude the Proponent's statement because the reference to the
Council's website is vague, and false or misleading statements could be
incorporated into the website at any time. Finally, the statement references an entire website. Stockholders who visit the
site cannot readily determine the source of the applicable statement made in the
Proposal, but will access a considerable volume of information that is not
germane to the Proposal. Moreover, the citation is to a third-party website
whose content cannot be regulated and is subject to change at any time.
Accordingly, for these and the other reasons set forth herein, the statement
should be excluded. 3. In the third paragraph of the Proponent's supporting statement, the Proponent
states: "In fact, a vast number of companies listed on the NYSE elect all
directors each year." This statement is properly excludable because it is an undocumented assertion of
fact not capable of verification by reference to the text of the Proposal
itself. See Staff Legal Bulletin No. 14 (July 13, 2001) (where the Staff states
that shareholders should provide factual support for statements in the proposal
and supporting statements). The Proponent does not cite a source for this
alleged statement of fact, thereby precluding the Company or its stockholders
from verifying the accuracy of the statement. The statement also does not
provide specific information as to the number or percentage of NYSE listed
companies which allegedly do not have classified boards of directors.
In addition, the statement that "a vast number of companies listed on the NYSE
elect all directors each year" can be viewed as an uncorroborated opinion
presented as fact. Mr. Mathis' idea of what constitutes "a vast number" may
differ dramatically from the views of other stockholders. This unsubstantiated
statement about "a vast number of companies" may lead stockholders to assume
that declassified boards are the "norm" for public companies, which would be a
highly questionable claim at best, and in any event has not been substantiated
in the slightest. The Staff has previously required proponents to substantiate the identity of
companies referenced in stockholder proposals. See The Boeing Company (February
7, 2001) (requiring the proponent to provide citations to "many institutional
investors" before such reference could be included in a proposal); R.J. Reynolds
Tobacco Holdings, Inc. (March 7, 2000) (requiring proponent to provide citations
to a "report" and an "experiment" before such references could be included in a
proposal). Therefore, the statement is properly excludable because it is vague
and misleading. 4. In the fourth paragraph of the Proponent's supporting statement, the
Proponent states: "The WALL STREET JOURNAL reports that: `Weak Boardrooms and
Weak Stocks Go Hand in Hand' September 9, 2003." This statement is properly excludable because it contains false information,
omits material information, and is misleading. The quote referenced by the
Proponent is a phantom one, as it does not appear anywhere in the September 9,
2003 issue of The Wall Street Journal. Without an accurate citation to support
the quote, the Company or its stockholders cannot verify the Proponent's
statement. See The Boeing Company (February 18, 2003) (instructing the Proponent
to provide factual support in the form of a citation for information attributed
to "McKinsey & Co. corporate governance survey"); Weyerhaeuser Company (January
21, 2003) (instructing the proponent to provide citation to a specific
publication date for the proposal's reference to a "major series by the Seattle
Times"). The only article that appears in the September 9, 2003 issue that focuses on
corporate governance and stock performance is an article entitled "Metrics Take
Stock of Cost and Effect of Bad Governance", printed in the Journal's "Heard On
The Street" opinion column. The article refers to a study that concluded that
companies with high corporate governance rankings outperformed businesses with
weak corporate governance rankings during the past three years. The article
mentions numerous criteria used by the study to measure a company's corporate
governance ranking - none of which included a declassified board of directors. A
copy of The Wall Street Journal article is attached hereto as Exhibit B. In
brief, the Proponent both has expressly made reference to a quote that does not
exist, and apparently mischaracterized a study referred to in The Wall Street
Journal as standing for the proposition that a classified board is a weak board
- when no such reference was made in the article. Moreover, Mr. Mathis has not
offered any other evidence to support this assertion, but has rather attempted
to attribute his opinion to a well-respected newspaper - a tactic sure to
mislead stockholders. Thus, exclusion of the statement is appropriate.
5. In the fifth paragraph of the Proponent's supporting statement, the Proponent
states: "Classified boards are rapidly becoming a thing of the past as more
companies demonstrate a greater commitment to the principles of corporate
democracy, adhering to policies that maximize accountability to shareholders."
The statement contains broad statements of the Proponent's beliefs presented as
facts. The Staff has on numerous occasions found statements in support of
stockholder proposals to be in violation of Rule 14a-9 where, as here, they are
overly broad statements of the Proponent's opinion. See DT Industries, Inc.
(August 10, 2001) (permitting exclusion of statements in support of a
shareholder proposal absent recasting of the statements as the proponent's
opinion); Prentiss Properties Trust, (March 8, 2001) (permitting exclusion of
statements in support of a shareholder proposal absent recasting of the
statements as the proponent's opinion); Lubrizol Corporation, (February 10,
1999) (permitting exclusion of statements in support of a shareholder proposal
absent recasting of the statements as the proponent's opinion). Accordingly, the
Proponents statement is materially false and misleading under Exchange Act Rule
14a-9. The Proponent's statement further suggests that Tidewater's Board of Directors
does not currently account to its stockholders. In addition to being a
completely false statement, this is merely another attempt to impugn the
reputation of Tidewater's Board of Directors, which, as discussed in detail in
paragraph 1 above, is impermissible under Exchange Act Rule 14a-9.
6. In the sixth paragraph of the Proponent's supporting statement, the Proponent
states: "Why should Tidewater continue the piecemeal approach of waiting three
years to complete their evaluation of the entire Board?"
The statement contains broad statements of the Proponent's beliefs presented as
facts and is therefore misleading under Exchange Act Rule 14a-9. The statement
suggests that unless Tidewater's Board of Directors is declassified, Tidewater's
stockholders will be precluded from evaluating the Company's Board of Directors.
The Proponent puts forth no evidence to support this assertion. As discussed in
paragraph 1 above, Tidewater's stockholders have consistently elected the
Board's nominees for director. 7. In the eighth paragraph of the Proponent's supporting statement, the
Proponent states: "Protect your investment through better corporate governance
and board accountability." The Proponent's statement is an overly broad statement of opinion and is
therefore excludable under Rule 14a-9. As discussed in detail in paragraph 4
above, the Staff has on numerous occasions found statements in support of
stockholder proposals to be in violation of Rule 14a-9 where, as here, they are
overly broad statements of the Proponent's opinion. In addition, statements of
opinion must be identified as such. See Staff Legal Bulletin No. 14 (July 13,
2001) (where the Staff states that shareholders should phrase statements as
their opinion where appropriate). The statement also suggests that Tidewater does not currently have a sound
corporate governance policy and that Tidewater's Board of Directors does not
currently account to its stockholders - yet another impermissible attempt to
impugn the reputation of Tidewater's management and its Board of Directors.
* * * * * We understand that the Staff on occasion permits stockholder proponents to amend
portions of a proposal and its supporting statement to avoid having the entire
proposal omitted under Rule 14a-8(i)(3). See Staff Legal Bulletin No. 14 (July
13, 2001). However, as the Staff made clear in Staff Legal Bulletin No. 14,
"when a proposal and supporting statement will require detailed and extensive
editing in order to bring them into compliance with the proxy rules,... [the
Staff] may find it appropriate for companies to exclude the entire proposal,
supporting statement, or both, as materially false or misleading."
The Company believes exclusion of the entire Proposalwithout an opportunity to
modify the Proposalis warranted in this case. As discussed above, the
Proposal's supporting statement would require a complete overhaul to bring it
into compliance with Rule 14a-9. Moreover, the proposal has been submitted by a
proponent who has substantial experience in submitting proposals under Rule
14a-8. Mr. Mathis frequently submits proposals, including on the topic of
declassification, that have required substantial editing in order to bring them
into compliance with Rule 14a-9. See Honeywell International, Inc. (October 16,
2001); Freeport-McMoRan Copper & Gold Inc. (February 21, 2001); Freeport-McMoRan
Copper & Gold Inc. (February 22, 1999); AlliedSignal Inc. (January 15, 1998).
Where, as here, a proponent is intimately familiar with the requirements of Rule
14a-8 and Rule 14a-9, it is especially appropriate to exclude a proposal by that
proponent where the proposal does not meet the rules' requirements. See Staff
Legal Bulletin No. 14 (noting that the Staff "spend[s] an increasingly large
portion of ... [its] time and resources each proxy season responding to
no-action requests regarding proposals or supporting statements that have
obvious deficiencies in terms of accuracy, clarity or relevance").
Accordingly, the Company believes that the entire Proposal is excludable from
the 2004 Proxy Statement pursuant to Rule 14a-8(i)(3) and Rule 14a-9 and that
Mr. Mathis should not be permitted an opportunity to amend the Proposal to
remedy its defects. CONCLUSION For the foregoing reasons, the Company has determined to omit the Proposal from
its 2004 Proxy Statement. If the Staff has any questions or comments regarding the foregoing, please
contact the undersigned at (504) 582-8308. Very truly yours,
/s/ Curtis R. Hearn
Attachments cc: Harold J. Mathis, Jr. [APPENDIX]
EXHIBIT A November 10, 2003 Tidewater, Inc.
Mr. Cliffe F. Laborde
601 Poydras Street, Suite 1900
New Orleans, LA 70130 BY FAX AND U.S. MAIL
Pursuant to Rule X-14 of the Securities and Exchange Commission, this letter is
formal notice to the management of Tidewater, Inc. that at the coming annual
meeting of 2004, Harold J. Mathis, Jr., who is the owner of 200 shares, will
cause to be introduced from the floor the following resolution. AS SHOWN BY THE
BOOKS AND RECORDS OF THE CORPORATION OR IN BROKERS NAMES THAT I HAVE BEEN OWNER.
THE STOCK WILL BE RETAINED PAST THE MEETING DATE. HOWEVER, CIRCUMSTANCES ARISING
AFTER SUCH DATE MAY CHANGE THE HOLDINGS. I ask that, if management intends to oppose this resolution, my name and address
as above (including e-mail address), together with the number of shares owned
and represented by me as recorded in the stock ledger of the Corporation, be
printed in the proxy statement together with the text of the resolution and the
statement of reasons for its introduction. I also ask that the substance of the
resolution be included in the notice of the annual meeting.
"RESOLVED: That the stockholders of Tidewater, Inc., assembled in annual meeting
in person or by proxy, hereby request that the Board of Directors take the
needed steps to provide that at future elections of directors new directors be
elected annually and not by classes, as is now provided, and that on expiration
of present terms of directors their subsequent elections shall also be on an
annual basis." REASONS It is this proponent's belief that classification of the Board of Directors is
not in the best interest of Tidewater, Inc. and its shareholders. This proponent
also believes that it makes a Board less accountable to shareholders when all
directors do not stand for election each year; the piecemeal election insulating
directors and senior management from the impact of poor performance.
The Council of Institutional Investors' (http://www.cii.org/) Shareholders Bill
of Rights recommends: 1) Annual Election of all directors
2) Adoption of shareholder resolutions that receive a majority of votes cast.
In fact, a vast number of companies listed on the NYSE elect all directors each
year. The WALL STREET JOURNAL reports that:
"Weak Boardrooms and Weak Stocks Go Hand in Hand."
September 9, 2003 Classified boards are rapidly becoming a thing of the past as more companies
demonstrate a greater commitment to the principles of corporate democracy,
adhering to policies that maximize accountability to shareholders.
Why should Tidewater, Inc. shareholders continue the piecemeal approach of
waiting three years to complete their evaluation of the entire Board?
REGISTER YOUR VIEWS ON THE TOTAL BOARD'S PERFORMANCE EACH YEAR.
Protect your investment through better corporate governance and board
accountability. Vote YES to evaluate director performance each year.
PLEASE MARK YOUR PROXY IN FAVOR OF THIS PROPOSAL; otherwise, it is automatically
cast as a vote against, even if you abstain. Sincerely,
/s/ Harold J. Mathis, Jr.
cc: Securities and Exchange Commission
Washington, D. C. 20549 [INQUIRY LETTER]
March 14, 2004 VIA FAX AND U.S. MAIL Securities and Exchange Commission
Division of Corporation Finance
Office of the Chief Counsel
450 Fifth Street, N.W.
Washington, D.C. 20549 RE: Tidewater, Inc. Stockholder Proposal Submitted by Harold J. Mathis, Jr.
Ladies and Gentlemen: This letter is in response to one directed to you from Jones Walker L.L.P.
regarding this proponent's proposal to elect all directors annually at
Tidewater, Inc. Many of the claims made by Mr. Hearn are unsound and do not
merit exclusion of my proposal from the 2004 Tidewater proxy materials.
1) It is not the intent of this proponent to impugn the integrity of directors
or management. It is the opinion of this proponent that staggered boards do not
enhance accountability to shareholders, and the annual election of directors
gives shareholders a more direct means to review director performance each year
and vote accordingly. 2) The council of Institutional Investors recently redesigned its website, under
the new listing of Council Policies. The substance is still the same, now
existing as: Council PoliciesThe Board of Directors
www.cii.org/dcwascii/web.nsf/doc/policies i.cm "Supermajority votes should not
be required." Council PoliciesShareholder Voting Rights
www.cii.org/dcwascii/web.nsf/doc/policies ii.cm "Supermajority votes should not
be required." This proponent is willing to recast his reference to Council Policies as stated
above which would take readers directly to the site. 3) This proponent is wiling to recast his statement to read "A large number of
publicly traded companies including ChevronTexaco, American International Group,
Halliburton, TXU, Con Edison, CSX Corp., Motorola, General Motors, Nicor, Inc.,
ExxonMobil, ADM, J.P. Morgan, Chase & Co., Xerox, Bristol-Myers Squibb, Advanced
Micro Devices, Ford, Motor Co., Bank of America, Altria Group, Freeport-McMoRan
Copper & Gold, American Express, Johnson & Johnson, Tyson Foods,
Hewlett-Packard, Co., AT&T, Southern Co., Weingarten Realty, Schlumberger, Home
Depot, Wells Fargo, Citigroup, Walt Disney Co., IBM, General Electric,
Microsoft, Intel and Dell, to name just a few, elect all directors annually as
cited in their respective proxy statements." 4) Mr. Hearn is wrong. The article "Weak Boardrooms and Weak Stocks Go Hand in
Hand" is in the September 9, 2003 edition of the WALL STREET JOURNAL on page C1.
Please see Exhibit A as attached. Further, there is no place for the kind of
sarcasm exhibited by Mr. Hearn when addressing the Staff in his reference to a
"phantom" WSJ article. 5) This proponent is willing to recast his statement to read "It is the belief
of this proponent that classified boards are rapidly becoming .......
accountability to shareholders." 6) I believe the question of "Why should Tidewater continue the piecemeal
approach of having shareholders wait three years to complete their evaluation of
the entire board?" to be correct as it stands and should not be recast.
7) I also believe the statement "Protect your investment through better
corporate governance and Board accountability" to be correct. This proponent
continues to maintain that better corporate governance and Board accountability
does protect one's investment. It appears from Mr. Hearn's petition to the Staff
that he opposes better corporate governance and board accountability in addition
to opposing the evaluation of director performance each year. These are
beneficial attributes and the statement as proposed should stand.
Finally, Mr. Hearn has referenced certain proposals previously filed by this
proponent. Mr. Hearn failed to mention that at Honeywell in 2002-2003 and at
Freeport-McMoRan Copper & Gold in 2002, no attempts were even made to exclude
these proposals, and in previous years, only minor revisions were recommended by
the Staff. Mr. Hearn's phrasing that these proposals "have required substantial
editing" is merely the subject of his opinion and should be labeled as such.
None of the companies mentioned above were ever allowed to omit the proposals of
this proponent, and in fact, the ones cited by Mr. Hearn went on to receive a
majority of affirmative votes. Mr. Hearn also failed to mention that his own
firm, after 5 years of opposition at Freeport-McMoRan Copper & Gold, authored a
company sponsored proposal with the recommendation to vote "yes." This was after
an affirmative vote of 78.43 % of the votes cast in 2002. It is unfortunate that Mr. Hearn chose not to discuss the issues with this
proponent prior to addressing the Staff because it appears that many of the
items cited could have been cured with simple modification.
An agreement to make simple revisions would have saved valuable Staff time and
the company money. Apparently, Tidewater was intent on not having a proposal
placed before shareholders regarding the annual election of directors.
Sincerely, /s/
Harold J. Mathis, Jr. cc: Curtis R. Hearn
Jones Walker L.L.P.
[STAFF REPLY LETTER]
March 26, 2004 Response of the Office of Chief Counsel Division of Corporation Finance
Re: Tidewater Inc. Incoming letter dated March 10, 2004
The proposal requests that the board take the needed steps to provide for the
annual election of all directors. We are unable to concur in your view that Tidewater may omit the entire proposal
under rule 14a-8(i)(3). There appears to be some basis for your view, however,
that portions of the supporting statement may be materially false or misleading
under rule 14a-9. In our view, the proponent must:
revise the reference to www.cii.org to provide a citation to a specific source
and delete the words "Shareholders Bill of Rights" from the phrase that begins
"The Council of Institutional Investors ..." and ends "... Bill of Rights
recommends";
provide factual support in the form of a citation to a specific source for the
sentence that begins "In fact, a vast ..." and ends "... directors each year";
and
recast the sentence that begins "Classified boards are ..." and ends "...
accountability to shareholders" as the proponent's opinion.
Accordingly, unless the proponent provides Tidewater with a proposal and
supporting statement revised in this manner, within seven calendar days after
receiving this letter, we will not recommend enforcement action to the
Commission if Tidewater omits only these portions of the supporting statement
from its proxy materials in reliance on rule 14a-8(i)(3). Sincerely,
/s/ John J. Mahon
Attorney-Advisor
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