The Shareholder Forum

supporting investor access

for the informed use of capital to produce goods and services


The Shareholder Forum


The Shareholder Forum provides all decision-makers – from the ultimate owners of capital to the corporate managers who use their capital, and all of the professionals in between – with reliably effective access to the information and views participants consider relevant to their respective responsibilities for the common objective of using capital to produce goods and services.

Having pioneered what became the widespread practice of "corporate access" events over two decades ago, the Forum continues to refine its "Direct Access" practices to assure effective support of marketplace interests.

Access Policies

To provide the required investor access without regulatory constraints, the Forum developed policies and practices allowing it to function as an SEC-defined independent moderator. We also adopted well-established publishing standards to assure essential participant privacy and communication rights.

These carefully defined and thoroughly tested Forum policies are the foundation of our unique marketplace resource for clearly fair access to information and exchanges of views.


We have been doing this for more than two decades. The Forum programs were initiated in 1999 by the CFA Society New York (at the time known as the New York Society of Security Analysts) with lead investor and former corporate investment banker Gary Lutin as guest chairman to address the professional interests of the Society’s members.

Independently supported by Mr. Lutin since 2001, the Forum’s public programs – often in collaboration with the CFA Society as well as with other educational institutions such as the Columbia Schools of Business and Journalism, the Yale School of Management and The Conference Board – have achieved wide recognition for their effective definition of both company-specific and marketplace issues, followed by an orderly exchange of the information and views needed to resolve them.

The Forum's ability to convene all key decision-making constituencies and influence leaders has been applied to subjects ranging from corporate control contests to the establishment of consensus marketplace standards for fair disclosure, and has been relied upon by virtually every major U.S. fund manager and the many other investors who have participated in programs that addressed their interests.


The Forum welcomes suggestions for its continuing support of fair access to the information needed by both shareholders and corporate managers.

Responding to the recent increases in investor engagement and activism, we have established a strong policy commitment to supporting corporate managers who wish to provide the leadership expected of them by assuring orderly reviews of issues. We will of course also continue to welcome the initiation of company-specific programs by shareholders concerned with the use of their capital to produce goods and services, and we naturally remain committed to addressing general marketplace interests in collaboration with educational institutions and publishers.


June 24, 2001

Market Watch: An All-He-Can Eat Feast at a Steakhouse Chain


For the shareholders of Lone Star Steakhouse and Saloon, there has been a lot more more fizzle than sizzle lately. During the biggest bull market in history, the stock of Lone Star, the Wichita restaurant chain, only sank. A shareholder who invested $100 in the stock in December 1995 had $22.08 at the end of 2000. The Standard & Poor's restaurant index rose almost 52 percent during the period.

Despite a sizable stock buyback program, per-share earnings at Lone Star fell 15 percent last year. Its stock, now at $12.89, trades 29 percent below its book value.

One might expect Lone Star management to make nice to its shareholders. Instead, it is poking them in the eye with a cattle prod.

Last year, the company more than tripled the salary and bonus of Jamie B. Coulter, the chairman, to $977,000. Six months ago, Lone Star forged a contract with Mr. Coulter that gives him a payment equal to 2.99 times one year's annual compensation if there is a change in control at the company.

Lone Star has also been a serial repricer of its stock options, most of which are held by its top executives. In 1997, it reduced to $18.25 the price of options that had ranged from $19 to $32.63. Two years later it repriced options of outside directors, and in 2000 it reduced the exercise price on all outstanding options to $8.47. Mr. Coulter holds options covering 2.6 million shares, accounting for 52 percent of his Lone Star holdings.

But even these excesses pale in comparison with the company's over-the-top response to the candidacy of Guy W. Adams, 50, a Lone Star investor of modest means who is running for an open board seat at the company's annual meeting on July 6.

Last February, Mr. Adams, an independent analyst in Los Angeles, filed proxy materials about the board seat. Two months later, Lone Star sued him, contending that because he had filed misleading proxy materials he should be prohibited from voting any proxies. But a judge ruled Friday that Mr. Adams could proceed after correcting two errors.

In pursuing the suit, Lone Star obtained Mr. Adams's bank, brokerage and phone records, combed through court proceedings in his 1999 divorce and sought to depose his landlord.

Hardball tactics are de rigueur in corporate America. But another Lone Star move is unusual: its subpoena and deposition of Ted White, corporate governance director at the California Public Employees' Retirement System, known as Calpers, owner of 372,000 Lone Star shares. Calpers said the company had one of the five worst boards of those in its portfolio. In the deposition, Mr. White said the fund would support Mr. Adams.

Lone Star said deposing Mr. White was necessary to determine whether Mr. Adams, who owns 1,100 shares, was a stalking horse for the investment fund. Mr. White denies this. "Their response to his candidacy was shameful," he said. "It's fairly telling that an entrenched board feels the need to protect itself with intense litigation."

Mr. Adams declined to comment, but said in court filings that the lawsuit looked like an attempt by the company to use litigation to prevent stockholders from being given a choice of candidates for the board seat.

Other investors agree. And the New York Society of Security Analysts' Committee for Corporate Governance is sponsoring a forum on Lone Star, said Gary Lutin, head of Lutin & Company in New York.

A spokesman for Lone Star said it was committed to shareholder value and that it would not reprice options for executives without a stockholder vote. The company is turning around, he said, and the stock, up 34 percent this year, reflects it.

But that climb could also mean that investors think the Lone Star board's days may be numbered. If that perception becomes a reality, it will come not a moment too soon.

Copyright 2001 The New York Times Company





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Publicly open programs of the Shareholder Forum are conducted for free participation of all shareholders of a subject company and any fiduciaries or professionals concerned with their decisions, according to the Forum’s stated "Conditions of Participation." In all cases, each participant is expected to make independent use of information obtained through the Forum, and participation is considered private unless the party specifically authorizes identification.

The information provided to Forum participants is intended for their private reference, and permission has not been granted for the republishing of any copyrighted material. The material presented on this web site is the responsibility of Gary Lutin, as chairman of the Shareholder Forum.

Shareholder Forum™ is a trademark owned by The Shareholder Forum, Inc., for the programs conducted since 1999 to support investor access to decision-making information. It should be noted that we have no responsibility for the services that Broadridge Financial Solutions, Inc., introduced for review in the Forum's 2010 "E-Meetings" program and had been offering for several years with the “Shareholder Forum” name, and we have asked Broadridge to use a different name that does not suggest our support or endorsement.