Company Name: Hewlett-Packard Co.
Public Availability Date: December 11, 2007
Document Sections:
INQUIRY LETTER
INQUIRY LETTER
APPENDIX
INQUIRY LETTER
INQUIRY LETTER
INQUIRY LETTER
STAFF REPLY LETTER
[INQUIRY LETTER]
November 2, 2007
Direct Dial
(202) 955-8653
Client No.
C 38126-00456
Fax No.
(202) 530-9677
VIA HAND DELIVERY
Office of Chief Counsel
Division of Corporation Finance
Securities and Exchange Commission
100 F Street, NE
Washington, DC 20549
Re: Stockholder Proposal of William Steiner Securities Exchange Act of 1934Rule
14a-8
Dear Ladies and Gentlemen:
This letter is to inform you that our client, Hewlett-Packard Company ("HP"),
intends to omit from its proxy statement and form of proxy for its 2008 Annual
Meeting of Stockholders (collectively, the "2008 Proxy Materials") a stockholder
proposal (the "Proposal") and statements in support thereof received from
William Steiner, who has appointed John Chevedden to act on his behalf (the
"Proponent").
Pursuant to Rule 14a-8(j), we have:
enclosed herewith six (6) copies of this letter and its attachments;
filed this letter with the Securities and Exchange Commission (the
"Commission") no later than eighty (80) calendar days before HP intends to file
its definitive 2008 Proxy Materials with the Commission; and
concurrently sent copies of this correspondence to the Proponent.
Rule 14a-8(k) provides that stockholder proponents are required to send
companies a copy of any correspondence that the proponents elect to submit to
the Commission or the staff of the Division of Corporation Finance (the
"Staff"). Accordingly, we are taking this opportunity to inform the Proponent
that if the Proponent elects to submit additional correspondence to the
Commission or the Staff with respect to the Proposal, a copy of that
correspondence should concurrently be furnished to the undersigned on behalf of
HP pursuant to Rule 14a-8(k).
THE PROPOSAL
The Proposal is captioned "Special Shareholder Meetings" and states: "RESOLVED,
shareholders ask our board of directors to amend our bylaws and/or charter to
give holders of 25% or less of our outstanding common stock, in compliance with
applicable law, the power to call a special shareholder meeting." A copy of the
Proposal and supporting statements, as well as related correspondence from the
Proponent, are attached to this letter as Exhibit A.
BASIS FOR EXCLUSION
We hereby respectfully request that the Staff concur in our view that the
Proposal may be excluded from the 2008 Proxy Materials pursuant to Rule
14a-8(i)(10) because HP's Board of Directors (the "Board") will in the near
future consider adoption of an amendment to its Amended and Restated Bylaws
("Current Bylaws") that will substantially implement the Proposal. Specifically,
the Board will be voting on an amendment to provide that the holders of not less
than 25% of the total voting power of the outstanding shares of stock entitled
to vote on the matter to be brought before the proposed special meeting will be
permitted to cause a special meeting of stockholders to be held, except in the
limited circumstances described below ("Proposed Bylaw Amendment"). Accordingly,
we request that the Staff concur with our view that the Proposed Bylaw Amendment
substantially implements the Proposal and, thus, the Proposal may be excluded
from the 2008 Proxy Materials pursuant to Rule 14a-8(i)(10).
ANALYSIS
The Proposal May Be Excluded under Rule 14a-8(i)(10) as Substantially
Implemented
A. Rule 14a-8(i)(10) Background
Rule 14a-8(i)(10) permits a company to exclude a stockholder proposal from its
proxy materials if the company has substantially implemented the proposal. The
Commission stated in 1976 that the predecessor to Rule 14a-8(i)(10) was
"designed to avoid the possibility of shareholders having to consider matters
which have already been favorably acted upon by the management." Exchange Act
Release No. 12598 (July 7, 1976). When a company can demonstrate that it already
has taken actions to address each element of a stockholder proposal, the Staff
has concurred that the proposal has been "substantially implemented" and may be
excluded as moot. See, e.g., Exxon Mobil Corp. (avail. Jan. 24, 2001); The Gap,
Inc. (avail. Mar. 8, 1996); Nordstrom, Inc. (avail. Feb. 8, 1995). Moreover, a
proposal need not be "fully effected" by the company in order to be excluded as
substantially implemented. See Exchange Act Release No. 40018 at n.30 and
accompanying text (May 21, 1998); Exchange Act Release No. 20091, at II.E.6.
(Aug. 16, 1983). The Staff has noted that "a determination that the company has
substantially implemented the proposal depends upon whether [the company's]
particular policies, practices and procedures compare favorably with the
guidelines of the proposal." Texaco, Inc. (avail. March 28, 1991). In other
words, substantial implementation under Rule 14a-8(i)(10) requires that a
company's actions satisfactorily address the underlying concerns of the proposal
and that the "essential objective" of the proposal has been addressed. See,
e.g., Anheuser-Busch Cos., Inc. (avail. Jan. 17, 2007); ConAgra Foods, Inc.
(avail. Jul. 3, 2006); Johnson & Johnson (avail. Feb. 17, 2006); The Talbots
Inc. (avail. Apr. 5, 2002); Masco Corp. (avail. Mar. 29, 1999).
B. Anticipated Action by HP's Board of Directors
The Proposal requests that the holders of 25% of HP's outstanding common stock
be permitted to call a special meeting of stockholders, which they are not
empowered to do under the Current Bylaws (except in the event that the entire
Board becomes vacant). Rather, under Section 2.3 of the Current Bylaws, a
special meeting of stockholders may be called only by the Board or, with the
concurrence of a majority of the Board, by the chairman of the Board, the chief
executive officer or the secretary. Section 211(d) of the Delaware General
Corporation Law (the state in which HP is incorporated) provides that the
authority to call a special meeting of stockholders is granted to the board of
directors or to such other person(s) as may be specified in the company's bylaws
or certificate of incorporation.
At the recommendation of management, the Board expects to consider, at a meeting
scheduled to be held on November 15, 2007, whether to approve an amendment to
the Current Bylaws to permit stockholders to cause a special meeting of
stockholders to be held. The Proposed Bylaw Amendment, attached hereto as
Exhibit B, would permit holders of at least twenty-five percent (25%) of the
outstanding shares of stock entitled to vote on the matter or matters to be
brought before the special meeting to cause a special meeting of stockholders to
be held. The Proposed Bylaw Amendment further provides that if the Board
determines in good faith that the business specified in the stockholders'
request will be included in an upcoming annual meeting within 90 days or has
been included in an annual or special meeting within the past 12 months, the
special meeting will not occur. We will supplementally notify the Staff after
the Board's consideration of the Proposed Bylaw Amendment.
C. The Proposed Bylaw Amendment Substantially Implements the Proposal
The Proposed Bylaw Amendment substantially implements the Proposal and,
accordingly, the Proposal may be excluded from the 2008 Proxy Materials in
reliance on Rule 14a-8(i)(10). As noted above, Commission statements and Staff
precedent with respect to Rule 14a-8(i)(10) confirm that the standard for
exclusion is that a stockholder proposal be substantially implemented, not fully
effected. In other words, Rule 14a-8(i)(10) permits exclusion of a stockholder
proposal when a company has implemented the essential objective of the proposal,
even when the manner by which a company implements the proposal does not
correspond precisely to the actions sought by the stockholder proponent. See
Exchange Act Release No. 20091 (Aug. 16, 1983). See also Honeywell International
Inc. (avail. Jan. 31, 2007); Sun Microsystems, Inc. (avail. Sept. 12, 2006);
General Motors Corp. (April 7, 2006) (avail. Apr. 5, 2006); Tiffany & Co. (avail. Mar. 14,
2006); The Boeing Co. (avail. Mar. 9, 2005); The Home Depot, Inc. (avail. Mar.
7, 2005) (each allowing exclusion under Rule 14a-8(i)(10) of a stockholder
proposal requesting that any future poison pill be put to a stockholder vote "as
soon as possible" or "within 4-months" where the company had a poison pill
policy in place that required a stockholder vote on any future poison pill
within one year). See also Schering-Plough Corp. (avail. Feb. 2, 2006); Northrop
Grumman Corp. (avail. Mar. 22, 2005); Southwest Airlines Co. (avail. Feb. 10,
2005) (each permitting exclusion of a stockholder proposal seeking
declassification of the company's board of directors "in the most expeditious
manner possible" when the company planned to phase in declassification of the
board of directors such that the directors were elected to one-year terms as
their current terms expired).
In the instant case, the Proposal requests that the Board amend the bylaws
and/or charter to give holders of 25% of the total voting power of the
outstanding HP stock the power to call a special stockholder meeting. Thus, the
"essential objective" of the Proposal is to permit the holders of 25% of HP's
stock to cause a special meeting of stockholders to occur. The Board will meet
on November 15, 2007 to consider and vote on amending the Current Bylaws as set
forth in the Proposed Bylaw Amendment. As noted above, the Proposed Bylaw
Amendment allows the holders of at least 25% of the outstanding shares of stock
entitled to vote on the matter or matters to be brought before the proposed
special meeting to cause a special meeting of stockholders to occur. Under the
Proposed Bylaw Amendment, the only circumstance under which the special meeting
would not be held is if the Board determines, in good faith, that the specific
business requested to be addressed at the proposed special meeting has recently
been addressed or is about to be addressed at another stockholder meeting. Thus,
the Proposed Bylaw Amendment implements the essential objective of the Proposal
by allowing the holders of 25% of the total voting power of the outstanding
shares of stock entitled to vote on the matter(s) to be brought before the
proposed special meeting to cause a special meeting of stockholders to occur,
which the stockholders are not presently empowered to do under the Current
Bylaws.
D. Supplemental Notification Following Board Action
We submit this no-action request at this time to address the timing requirements
of Rule 14a-8. We will supplementally notify the Staff after Board consideration
of the Proposed Bylaw Amendment. The Staff consistently has granted no-action
relief under Rule 14a-8(i)(10) where a company intends to omit a stockholder
proposal on the grounds that the board of directors is expected to take certain
action that will substantially implement the proposal, and then supplements its
request for no-action relief by notifying the Staff after that action has been
taken by the board of directors. See, e.g., The Dow Chemical Co. (avail. Feb.
26, 2007); Johnson & Johnson (avail. Feb. 13, 2006); General Motors Corp.
(avail. Mar. 3, 2004); Intel Corp. (avail Mar. 11, 2003) (each granting
no-action relief where the company notified the Staff of its intention to omit a
stockholder proposal under Rule 14a-8(i)(10) because the board of directors was
expected to take action that would substantially implement the proposal, and the
company supplementally notified the Staff of the board action).
CONCLUSION
Based upon the foregoing analysis, we believe that once the Board takes the
anticipated action described above, the Proposal will have been substantially
implemented by the Proposed Bylaw Amendment, and therefore will be excludable
under Rule 14a-8(i)(10). Thus, we respectfully request that the Staff concur
that it will take no action if HP excludes the Proposal from its 2008 Proxy
Materials in reliance on Rule 14a-8(i)(10). We would be happy to provide you
with any additional information and answer any questions that you may have
regarding this subject. If we can be of any further assistance in this matter,
please do not hesitate to call me at (202) 955-8653 or David Ritenour, HP's
Senior Counsel, at (650) 857-3059.
Sincerely,
/s/
Amy L. Goodman
ALG/jlk
Enclosures
cc: David Ritenour, Hewlett-Packard Company
John Chevedden
[INQUIRY LETTER]
William Steiner
112 Abbottsford Gate
Piermont, NY 10968
Mr. Mark Hurd
Chairman
Hewlett-Packard Company (HPQ)
3000 Hanover Street
Palo Alto, CA 94304
PH: 650-857-1501
FX: 650-857-5518
Rule 14a-8 Proposal
Dear Mr. Hurd,
This Rule 14a-8 proposal is respectfully submitted in support of the long-term
performance of our company. This proposal is submitted for the next annual
shareholder meeting. Rule 14a-8 requirements are intended to be met including
the continuous ownership of the required stock value until after the date of the
respective shareholder meeting and the presentation of this proposal at the
annual meeting. This submitted format, with the shareholder-supplied emphasis,
is intended to be used for definitive proxy publication. This is the proxy for
John Chevedden and/or his designee to act on my behalf regarding this Rule 14a-8
proposal for the forthcoming shareholder meeting before, during and after the
forthcoming shareholder meeting. Please direct all future communication to John
Chevedden at:
olmsted7p (at) earthlink.net
(In the interest of saving company expenses please communicate via email.)
PH: 310-371-7872
2215 Nelson Ave., No. 205
Redondo Beach, CA 90278
Your consideration and the consideration of the Board of Directors is
appreciated in support of the long-term performance of our company. Please
acknowledge receipt of this proposal by email.
Sincerely,
/s/
William Steiner
9/21/07
Date
cc: Charles N. Charnas
Corporate Secretary
FX: (650) 857-4837
FX: 650-236-1450
[APPENDIX]
[HPQ: Rule 14a-8 Proposal, September 25, 200]
3Special Shareholder Meetings
RESOLVED, shareholders ask our board of directors to amend our bylaws and/or
charter to give holders of 25% or less of our outstanding common stock, in
compliance with applicable law, the power to call a special shareholder meeting.
William Steiner, Piermont, New York, who sponsored a number of proposals on this
topic, said the shareholders should have the ability to call a special meeting
when they think a matter is sufficiently important to merit expeditious
consideration. Shareholder control over timing is especially important in the
context of a major acquisition or restructuring, when events unfold quickly and
issues may become moot by the next annual meeting.
Prominent institutional investors and organizations support a shareholder right
to call a special meeting. Fidelity and Vanguard are among the mutual funds
supporting a shareholder right to call a special meeting. The proxy voting
guidelines of many public employee pension funds, including the New York City
Employees Retirement System, also favor preserving this right. Governance
ratings services, such as The Corporate Library and Governance Metrics
International, take special meeting rights into account when assigning company
ratings.
This topic also won the following impressive support at these major companies in
2007:
Allegheny Energy (AYE) 57%
AMR Corp. (AMR) 53%
AT&T (T) 65%
Borders Group. (BGP) 68%
Citigroup (C) 62%
Colgate-Palmolive (CL) 63%
CSX Corp. (CSX) 69%
Electronic Data Systems (EDS) 58%
El Paso Corp. (EP) 68%
Honeywell (HON) 74%
RadioShack (RSH) 71%
Time Warner (TWX) 64%
To improve the accountability of our Board to shareholders:
Special Shareholder Meetings Yes on 3
Notes:
Mr. William Steiner, 112 Abbottsford Gate, Piermont, NY 10968 sponsors this
proposal.
The above format is requested for publication without re-editing or
re-formatting.
The company is requested to assign a proposal number (represented by "3" above)
based on the chronological order in which proposals are submitted. The requested
designation of "3" or higher number allows for ratification of auditors to be
item 2.
This proposal is believed to conform with Staff Legal Bulletin No. 14B (CF),
September 15, 2004 including:
Accordingly, going forward, we believe that it would not be appropriate for
companies to exclude supporting statement language and/or an entire proposal in
reliance on rule 14a-8(i)(3) in the following circumstances:
the company objects to factual assertions because they are not supported;
the company objects to factual assertions that, while not materially false or
misleading, may be disputed or countered;
the company objects to factual assertions because those assertions may be
interpreted by shareholders in a manner that is unfavorable to the company, its
directors, or its officers; and/or
the company objects to statements because they represent the opinion of the
shareholder proponent or a referenced source, but the statements are not
identified specifically as such.
See also: Sun Microsystems, Inc. (July 21, 2005).
Please note that the title of the proposal is part of the argument in favor of
the proposal. In the interest of clarity and to avoid confusion the title of
this and each other ballot item is requested to be consistent throughout all the
proxy materials.
Please advise if there is any typographical question.
Stock will be held until after the annual meeting and the proposal will be
presented at the annual meeting.
Please acknowledge this proposal by email within 14-days and advise the most
convenient fax number and email address to forward a broker letter, if needed,
to the Corporate Secretary's office.
[INQUIRY LETTER]
December 4, 2007
Direct Dial
(202) 955-8653
Client No.
C 38126-00456
Fax No.
(202) 530-9677
VIA HAND DELIVERY
Office of Chief Counsel
Division of Corporation Finance
Securities and Exchange Commission
100 F Street, NE
Washington, DC 20549
Re: Supplemental Letter Regarding Stockholder Proposal of William Steiner
Represented by John Chevedden
Securities Exchange Act of 1934Rule 14a-8
Dear Ladies and Gentlemen:
On November 2, 2007, we submitted a letter (the "No-Action Request") on behalf
of our client, Hewlett-Packard Company ("HP"), notifying the staff of the
Division of Corporation Finance (the "Staff") that HP intends to omit from its
proxy statement and form of proxy for its 2008 Annual Meeting of Stockholders
(collectively, the "2008 Proxy Materials") a stockholder proposal and statements
in support thereof (the "Proposal") received from William Steiner, who has
appointed John Chevedden to be his representative for all issues pertaining to
the Proposal (the "Proponent"). The Proposal requests that HP's Board of
Directors (the "Board") amend the "bylaws and/or charter to give holders of 25%
or less of our outstanding common stock, in compliance with applicable law, the
power to call a special shareholder meeting."
BASIS FOR SUPPLEMENTAL LETTER
The No-Action Request indicated our belief that the Proposal may be excluded
from the 2008 Proxy Materials because the Board would be considering an
amendment to its Amended and Restated Bylaws that would substantially implement
the Proposal. We write supplementally to:
confirm that at a meeting on November 15, 2007, the Board approved an
amendment to its Amended and Restated Bylaws to allow the holders of at least
25% of HP stock to cause the Board to call a special meeting of stockholders
(the "Bylaw Amendment," filed with the SEC as an exhibit to the Current Report
on Form 8-K on November 19, 2007, and attached hereto as Exhibit A); and
respond to the correspondence dated November 25, 2007 from the Proponent
regarding the Proposal (the "Response"), a copy of which is attached hereto as
Exhibit B.
BYLAW AMENDMENT
The Bylaw Amendment adopted by the Board on November 15, 2007, differs in one
respect from the proposed bylaw amendment referenced in the No-Action Request.
Specifically, the proposed bylaw amendment granted the Board discretion to
determine whether the specific business requested to be addressed at the
proposed special meeting either will be included in an upcoming annual meeting
within 90 days or had been included in an annual or special meeting within the
past 12 months. Under the adopted Bylaw Amendment, however, Board is granted
discretion only to determine whether the specific business requested to be
addressed at the proposed special meeting will be included in an upcoming annual
meeting within 90 days.
ANALYSIS
As we discussed in more detail in the No-Action Request, Rule 14a-8(i)(10)
permits a company to exclude a stockholder proposal from its proxy materials if
the company has substantially implemented the proposal. Under Rule 14a-8(i)(10),
substantial implementation requires that a company's actions satisfactorily
address the "essential objective" of the proposal. See, e.g., Kroger Co. (avail.
Apr. 11, 2007); General Motors Corp. (avail. Apr. 5, 2006); Lowes Cos., Inc.
(avail. Mar. 21, 2005).
The Bylaw Amendment substantially implements the Proposal and, accordingly, the
Proposal may be excluded from the 2008 Proxy Materials in reliance on Rule
14a-8(i)(10). Specifically, the Bylaw Amendment provides that a special meeting
of stockholders shall be called by the Board upon the request of the holders of
not less than 25% of all shares of HP stock entitled to vote on the matter or
matters to be brought before the proposed special meeting. See Exhibit A. The
Proposal requests that the Board amend HP's "bylaws and/or charter to give
holders of 25%" of HP's stock the power to call a special meeting of
stockholders. Thus, the "essential objective" of the Proposal is to permit the
holders of 25% of HP's stock to cause a meeting of stockholders to be held,
which the stockholders were not empowered to do prior to the Board's adoption of
the Bylaw Amendment. Consequently, the Bylaw Amendment substantially implements
the essential objective of the Proposal by permitting the holders of at least
25% of HP's stock to cause a meeting of the stockholders to be held.
The only difference between the Proposal and the Bylaw Amendment is the limited
circumstance under which the Board will not call a special meeting of
stockholders under the Bylaw Amendmentwhen the Board in good faith determines
that the specific business requested to be addressed at the proposed special
meeting will be addressed at an upcoming annual meeting within ninety (90) days.
This narrow circumstance was included in the Bylaw Amendment to avoid the costs
and burdens on HP and its stockholders associated with holding a special meeting
to consider the same specific business that is about to be considered (within 90
days) at an annual meeting and to allow HP the time necessary to arrange for a
special meeting (e.g. preparing and mailing proxy materials). The Board, in
adherence to its fiduciary responsibilities to HP's stockholders, is responsible
for conserving company resources and costs when possible and for seeing that
stockholders receive full and fair disclosure concerning matters to be
considered at a stockholders' meeting.
This narrow circumstance also avoids asking stockholders to consider repeatedly
the same specific business within a short span of time (specifically, 90 days).
The Commission, in adopting various substantive bases for the exclusion of
stockholder proposals, has noted similar concerns with stockholders having to
consider the same issues repeatedly. For example, the Commission stated in 1976
that the predecessor to Rule 14a-8(i)(10) was "designed to avoid the possibility
of shareholders having to consider matters which have already been favorably
acted upon by management." Exchange Act Release No. 12598 (July 7, 1976) (the
"1976 Release"). The Commission offered a similar reason for adopting Rule
14a-8(i)(11), which allows the exclusion of a proposal that "substantially
duplicates another proposal previously submitted to the company by another
proponent that will be included in the company's proxy materials for the same
meeting." In the 1976 Release, the Commission noted that the purpose of the
exclusion was to "eliminate the possibility of shareholders having to consider
two or more substantially identical proposals ...." Similarly, the HP Board is
seeking to avoid asking stockholders to consider the same specific business at a
special meeting of stockholders that will be addressed at an upcoming annual
meeting within the next 90 days.
In his Response, the Proponent expresses concern that the "exception [referenced
in the No-Action Request] is vague and all-encompassing" and that "there is no
conceivable business that would fall outside this exception." It appears that
the Proponent's concern has been addressed because, as noted above, the Bylaw
Amendment adopted by the Board eliminates the Board's discretion not to call a
special meeting if the business was previously addressed at an annual or special
meeting of stockholders within the past 12 months. Accordingly, the only matter
that the Board can consider under the Bylaw Amendment is whether the "specific
business" requested to be addressed at the special meeting will be addressed at
an upcoming annual meeting of the stockholders within 90 days. The inclusion in
the Bylaw Amendment of the phrase "specific business" and the requirement that
the Board act in "good faith" significantly limit any Board discretion.
Moreover, the language in the Bylaw Amendment that the Proponent references is
not an "exception" to the right of stockholders to call a special meeting, but
simply a matter of timing.
This matter of timing is analogous to the situation in several no-action letters
in which the Staff has concurred under Rule 14a-8(i)(10) that a company has
substantially implemented a proposal when the Board has altered the time period
for the action requested in the proposal. For example, several poison pill
stockholder proposals have requested that companies subject any future poison
pills to a stockholder vote "as soon as possible," such as "within four months."
Many of the companies that received these poison pill proposals already had
poison pill bylaws or policies in place, which provided that any poison pill
adopted by the board of directors without prior stockholder approval would
expire within one year if not approved by stockholders (also known as a "sunset
provision"). The Staff consistently has concurred that companies could exclude
such proposals where the proposals differ from a company's bylaws or policies
only with regard to the time period in which the poison pill must be submitted
to a stockholder vote. See, e.g., Honeywell International Inc. (avail. Jan. 31,
2007) (allowing exclusion under Rule 14a-8(i)(10) of a proposal requesting that
any poison pill be put to a stockholder vote "as soon as possible" and "within
4-months" where the company already had a poison pill policy with a sunset
provision in place, even though the proposal's supporting statement indicated
that "[i]t is essential that a sunset provision not be used as an escape clause
from a shareholder vote"). See also Sun Microsystems, Inc. (avail. Sept. 12,
2006); General Motors Corp. (avail. Apr. 5, 2006); Tiffany & Co. (avail. Mar.
14, 2006); The Boeing Co. (avail. Mar. 9, 2005); The Home Depot, Inc. (avail.
Mar. 7, 2005). Similarly, the Staff has permitted exclusion of stockholder
proposals seeking to declassify a company's board of directors "expeditiously"
when the company has determined to phase-in the declassification over a period
of years. See, e.g., Schering-Plough Corp. (avail. Feb. 2, 2006); Northrop
Grumman Corp. (avail. Mar. 22, 2005); Southwest Airlines Co. (avail. Feb. 10,
2005).
Similar to the no-action letters cited above, the only difference between the
Bylaw Amendment and the Proposal is one of timing, relating to whether a special
meeting will be held if the specific business requested to be addressed will be
addressed at an upcoming annual meeting of stockholders within 90 days. This
distinction is analogous to the distinction between "four months" and "one year"
in the poison pill no-action letters cited above and to the timing of board
declassification also cited above. Thus, for the reasons set forth above and in
the No-Action Request, HP believes that the Bylaw Amendment substantially
implements the Proposal and that the Proposal may therefore be excluded from
HP's 2008 Proxy Materials under Rule 14a-8(i)(10).
CONCLUSION
Based on the foregoing analysis, we respectfully request that the Staff concur
that it will take no action if HP excludes the Proposal from its 2008 Proxy
Materials for the reasons set forth above. Pursuant to Rule 14a-8(j), enclosed
herewith are six (6) copies of this supplemental letter and its attachments.
Also, in accordance with Rule 14a-8(j), a copy of this supplemental letter and
its attachments are being mailed on this date to the Proponent. HP hereby agrees
to promptly forward to the Proponent any Staff response to this supplemental
letter that the Staff transmits by facsimile to HP only.
We would be happy to provide you with any additional information and answer any
questions that you may have regarding this subject. If we can provide any
additional information or be of any further assistance in this matter, please do
not hesitate to call me at (202) 955-8653 or David Ritenour, HP's Senior
Counsel, at (650) 857-3059.
Sincerely,
/s/
Amy L. Goodman
ALG/jlk
Enclosures
cc: David Ritenour, Hewlett-Packard Company
John Chevedden
[INQUIRY LETTER]
November 25, 2007
Office of Chief Counsel
Division of Corporation Finance
Securities and Exchange Commission
100 F Street, NE
Washington, DC 20549
Hewlett-Packard Company (HPQ)
Shareholder Position on Company No-Action Request
Rule 14a-8 Proposal: Special Shareholder Meetings
William Steiner
Ladies and Gentlemen:
The text of the Rule 14a-8 proposal states:
3Special Shareholder Meetings
RESOLVED, shareholders ask our board of directors to amend our bylaws and/or
charter to give holders of 25% or less of our outstanding common stock, in
compliance with applicable law, the power to call a special shareholder meeting.
There is no call-out in the above text for the company to add important and
vaguely worded exclusions, and for which the company would have great freedom to
interpret the vaguely worded exclusions.
It is clear that this company exception is vague and all-encompassing:
"... if the Board determines, in good faith, that the specific business
requested to be addressed at the proposed special meeting has recently been
addressed or is about to be addressed at another stockholder meeting."
Arguably there is no conceivable business that would fall outside this
exception. Thus there would effectively be no right to call a special meeting
according to proposed future bylaw Amendment which was supposed to happen on
November 15, 2007.
For the above reasons it is respectfully requested that concurrence not be
granted to the company on the purported basis of substantial implementation. It
is also respectfully requested that the shareholder have the last opportunity to
submit material in support of including this proposalsince the company had the
first opportunity.
Sincerely,
John Chevedden
cc:
[INQUIRY LETTER]
December 10, 2007
Office of Chief Counsel
Division of Corporation Finance
Securities and Exchange Commission
100 F Street, NE
Washington, DC 20549
Hewlett-Packard Company (HPQ)
# 2 Shareholder Position on Company No-Action Request
Rule 14a-8 Proposal: Special Shareholder Meetings
William Steiner
Ladies and Gentlemen:
The Hewlett-Packard December 4, 2007 supplement is a failure in explaining or
giving an example on how this vague and all-encompassing exception could
purportedly be "narrow:" "... if the Board determines, in good faith, that the
specific business requested to be addressed at the proposed special meeting has
recently been addressed or is about to be addressed at another stockholder
meeting."
The company does not even give a definition of "addressed" in its bylaw
amendment. Does "addressed" mean that if an employee simply asked a 10-word
question on a particular topic at the previous annual meeting, that the topic is
thus deemed "addressed" and precluded from being the subject of a special
meeting.
Hewlett-Packard repeats "narrow" or "limited" but gives no example of how the
above all-encompassing exception could possibly work out to be "narrow." The
empty thrust of the company argument is unsupported assertions of "narrow" or
"limited" and repetition of these unsupported assertions.
There is no methodology, criteria or formula given or mandated for the board to
decide, under this formal bylaw amendment, "that the specific business requested
to be addressed at the proposed special meeting has recently been addressed or
is about to be addressed at another stockholder meeting."
Thus the company "notwithstanding the foregoing" clause is merely the means to
subtract everything, or almost everything, that the remainder of bylaw amendment
grants.
Additionally the company does give any remedy if 25% or more of shareholders
declare that what "Board determines, in good faith" is not in good faith.
The company does not explain why it has not adopted the topic of this proposal
in a manner similar to this simple and effective section in the Southwest
Airlines Co. (LUV) bylaws:
Section 3. Special Meetings: Special meetings of the shareholders may be called
by the Chairman of the Board or the Chief Executive Officer and shall be called
by the Secretary upon written request, stating the purpose or purposes therefor,
by a majority of the whole Board of Directors or by the holders of at least ten
(10) percent (or such greater percentage not exceeding a majority as may be
specified in the Articles of Incorporation) of all of the shares entitled to
vote at the meeting.
The company does not give one example of a company getting hammered by
shareholders calling for a special meeting that was simply for a repetition of a
topic that was thoroughly reviewed at a previous annual meeting.
For the above reasons and the reasons in the November 25, 2007 response it is
respectfully requested that concurrence not be granted to the company on the
purported basis of substantial implementation. It is also respectfully requested
that the shareholder have the last opportunity to submit material in support of
including this proposalsince the company had the first opportunity.
Sincerely,
John Chevedden
cc:
William Steiner
Charles N. Charnas<Charles.Charnas@hp.com>
Corporate Secretary
[STAFF REPLY LETTER]
December 11, 2007
Response of the Office of Chief Counsel Division of Corporation Finance
Re: Hewlett-Packard Company
Incoming letter dated November 2, 2007
The proposal asks the board of directors to amend the bylaws and/or charter to
give holders of 25% or less of the outstanding common stock the power to call a
special shareholder meeting.
There appears to be some basis for your view that HP may exclude the proposal
under rule 14a-8(i)(10). Accordingly, we will not recommend enforcement action
to the Commission if HP omits the proposal from its proxy materials in reliance
on rule 14a-8(i)(10).
Sincerely,
/s/
Heather L. Maples
Special Counsel
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