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.


For a copy of the decision addressed in the article below, see

For another case addressing similar issues, see


The Harvard Law School Forum on Corporate Governance and Financial Regulation, February 19, 2010 posting



Delaware Court of Chancery Addresses Proxy Contest Mechanics and Vote Buying

Posted by Trevor Norwitz, Wachtell, Lipton, Rosen & Katz, on Friday February 19, 2010 at 9:01 am

Editor’s Note: Trevor Norwitz is a partner in the Corporate Department at Wachtell, Lipton, Rosen & Katz, where he focuses on mergers and acquisitions, corporate governance and securities law matters. This post is based on a Wachtell Lipton client memorandum by Mr. Norwitz and William Savitt.

In a recent decision involving dueling consent solicitations, the Delaware Court of Chancery cast welcome light on the “foggy” mechanics of proxy solicitations and offered guidance on “vote-buying” in corporate control contests. Kurz v. Holbrook., C.A. No. 5019-VCL (February 9, 2010).

The case involved a contest for control of EMAK Worldwide, a “deregistered, poorly performing microcap corporation” with one large preferred stockholder and an otherwise “diffuse” stockholder body. An insurgent slate sought to remove two directors and elect replacements, thereby taking control of the company. The incumbent group sought to amend EMAK’s by-laws to reduce the size of the board, thereby effectuating the dismissal of certain sitting directors, mooting the insurgents’ attempt to elect new directors, and ensuring a majority position for the large preferred stockholder. After a hard-fought contest, the incumbent’s by-law provisions obtained a close majority of consents. A few days later, however, the insurgent slate secured a majority of consents as well, but only after insurgents purchased 150,000 shares needed to provide a bare 50.89% majority. But the inspector of elections then disallowed some 1,000,000 shares held in “street name” because they were not accompanied by a DTC “universal proxy,” thus maintaining the incumbent group majority. The insurgents sued, challenging both the validity of the by-law and the invalidation of their “street name” votes.

The court ruled in favor of the insurgents. Marking a clear and considered revision of established law, Vice Chancellor Laster held that “street name” holders — banks and brokers who appear on the DTC participant listing (or “Cede breakdown”) — are “stockholders of record” for purposes of determining which shareholders have the right to vote or act by written consent. Although dispensing with the need for a DTC “universal proxy” in this case, the Vice Chancellor took care to reaffirm the traditional distinction between record holders and beneficial holders. It remains Delaware law that only record holders can vote, but in ascertaining who those record holders are, companies must now look behind Cede & Co. to the participating banks and brokers on the Cede breakdown on the record date. As the decision demonstrates, the new rule may be decisive in a close consent solicitation contest, even if its impact in the average case may not be noticeable to those not directly involved in the plumbing of the voting system. And the decision indicates that Chancery will consider revising even long-standing rules that risk to disenfranchise stockholders. In all events, the scholarly opinion provides fascinating reading for those interested in the historical evolution and working of our arcane proxy system.

In another matter of first impression, the court invalidated the by-law amendment that purported to reduce the size of the board to fewer than the number of sitting directors, ruling that it is impermissible under the Delaware statute to “metaphorically pull[] [directors’] seats out from under them.” In similar vein, the court noted that a bylaw purporting to impose a requirement that would disqualify a sitting director and thereby terminate his service would be invalid under Delaware law.

The decision also rejected the incumbents’ claim that the insurgents had engaged in improper “vote buying.” Dismissing the view that Delaware law has no restrictions on vote buying by third parties, the Vice Chancellor expressed that Delaware law should not hesitate to provide a remedy where the decoupling of economic ownership of shares from their voting rights proves deleterious, particularly where there is fraud or disparity of information. But where, as in this case, the party buying the votes assumes the economic risks of ownership, the court will perceive no “legal wrong” just because the buyer is primarily interested in securing swing votes needed to win an election. The decision thus underscores the potential for creative campaigning, and the need for careful planning, in the context of a contested election for corporate control.



© 2010 The President and Fellows of Harvard College




Inquiries, requests to be included in email distribution lists, and suggestions of new Forum subjects may be addressed to

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.