Shareholder Proposals: Poison Pills

Overview

Shareholder proposals requesting adoption of
health care reforms

Companies will often seek to exclude proposals as "ordinary business" by invoking Rule 14a-8(i)(7) or under other provisions of Rule 14a-8
See no action letters below for cases in which SEC has granted and denied company requests for exclusion of health care proposals

RiskMetrics

2008 Preview: Social Issues 3.28.08

Basis for SEC distinction between "excludable"
and "not excludable" Health Care Principles proposals
is unclear see 2008 proposals below
Appears that 12 resolutions on health care principles will come to vote in 2008 proxy season

Health Care Principles

2008

These shareholder proposals call for board adoption of principles for comprehensive health care reform

Basis for SEC distinction between "excludable" and "not excludable" proposals is unclear

Proposal text follows this general format

RESOLVED: Shareholders of ___________ (the "Company") urge the Board of Directors (the "Board") to adopt principles for health care reform based upon principles reported by the Institute of Medicine:

1. Health care coverage should be universal.

2. Health care coverage should be continuous.

3. Health care coverage should be affordable to individuals and families.

4. The health insurance strategy should be affordable and sustainable for society.

5. Health insurance should enhance health and well being by promoting access to high-quality care that is effective, efficient, safe, timely, patient-centered, and equitable

No action letters Proposal not excludable

General Motors 3.26.08

American Baptist Home Mission Society
May not be excluded from the company's proxy material under rule Rule 14a-8(i)(7)
2008 Proxy Statement Item No. 5

UST Inc. 2.07.08

Congregation of Sisters of Saint Agnes, the Sisters of St. Francis of Assisi and the Catholic Health Initiatives
May not be excluded from the company's proxy material under rule 14a-8(i)(3) or (i)(7)

2008 Proxy Statement pending

Boeing Co. 2.05.08

AFL-CIO Reserve Fund
May not be excluded from the company's proxy material under rule 14a-8(i)(3), (i)(6) or (i)(7)
2008 Proxy Statement Item 4

United Technologies Corp. 1.31.08

AFL-CIO Reserve Fund
May not be excluded from the company's proxy material under rule 14a-8(i)(3), (i)(6) or (i)(7)
2008 Proxy Statement proposal 4

No action letters Proposal excludable

CVS Caremark Corp. 1.31.08

Catholic Healthcare Partners, Adrian Dominican Sisters, Trinity Health, Sisters of Charity of the Incarnate Word, Sisters of St. Francis of Philadelphia and Basilian Fathers of Toronto
Proponent urges board to report annually on how it is implementing such principles
May be omitted from the company's proxy material under rule 14a-8(i)(7)

Wyeth 2.25.08

The Sisters of Charity of St. Elizabeth, Catholic Healthcare Partners, Trinity Health and Catholic Health Initiatives

Proponent urges board to report annually on how it is implementing such principles

May be omitted from the company's proxy material under rule 14a-8(i)(7)

No action letters Proposal withdrwawn

Bristol-Myers Squibb Co. 1.10.08

Trinity Health and the American Baptist Home Mission Society
Withdrawal of the proposal rendered matter moot

Abbott Laboratories 1.10.08

Sisters of Charity of Saint Elizabeth, Basilian Fathers of Toronto, Benedictine Sisters Charitable Trust (Texas), Benedictine Sisters of Virginia, Camilla Madden Charitable Trust, Catholic Health Initiatives, Catholic Healthcare Partners, Catholic Healthcare West, Benedictine Convent of Perpetual Adoration, Congregation of Divine Providence, Inc., Mount St. Scholastica Benedictine Sisters, Providence Trust, Sisters of Charity of the Incarnate Word, Houston, Texas, Sisters of the Holy Names of Jesus and Mary U.S.-Ontario Province, Sisters of the Holy Spirit and Mary Immaculate and Sisters of the Sorrowful Mother International Finance, Inc.
Withdrawal of the proposal rendered matter moot

Universal Health Care Policy

2008

Proposal text follows this format

___________ shall in good faith and in a reasonable time work to obtain a health insurance plan (or plans) for domestic employees that will sign up preferred providers who will bill non-employees at rates no more than the allowed charge for employees. The allowed charges shall be similar to that of other insurers.

No action letters Proposal excludable

Johnson & Johnson 1.11.08

Stephen Sacks
May be omitted from the company's proxy material under rule 14a-8(i)(7)

Health Care Report

2007

Proposal text follows this format

Shareholders request that the company report (at reasonable cost and omitting proprietary information) on the implications of rising health care expenses and how it is positioning itself to address this public policy issue without compromising the health and productivity of its workforce. The report should be completed by _______ 200_ and need not address specific benefit offerings.

Annual meetings

Wal-Mart

2007 Proxy Statement Proposal 4
Voting results not approved

Ford

2007 Proxy Statement Proposal 10
Voting results not approved

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