United States: Preparing For The Annual Shareholders Meeting: Five Practical Matters US Public Companies Should Consider Now

Keywords: shareholder meetings, corporate, AGMs,

By now, public companies should be actively engaged in preparing for their upcoming annual meeting of shareholders. Significant corporate resources are typically devoted to the preparation of the proxy statement and the solicitation and tabulation of votes, matters which are key to the annual meeting process. However, while considerations regarding the conduct of the meeting itself are equally as important, they frequently are not given as much attention. We discuss below five areas in which advance planning can facilitate a smooth meeting process.

Meeting Attendance

Companies should establish who is allowed to attend the shareholders meeting and what documentation they must provide. Some companies require admission tickets and/or preregistration for shareholders to attend the meeting. Companies should also decide what documentation beneficial owners must provide in order to attend the meeting. At a minimum, companies typically require that beneficial owners provide either a proxy from the record owner or a copy of their latest brokerage account statement showing their beneficial ownership position in order to vote at the meeting; many companies require the same documentation in order for beneficial owners to attend the meeting. If a company permits a shareholder to bring guests to the meeting, the company should determine whether or not it wants to limit the number of guests. Requirements for shareholder attendance should be decided well in advance of the meeting and should be disclosed in the proxy statement to avoid any issues on the day of the meeting.

If media or analysts are permitted to attend the annual meeting, the company should consider whether to provide them with a separate seating section at the meeting or a satellite room with video feed. Companies may want to limit such attendance to observation only, allowing only shareholders to ask questions and make statements. Companies should also decide in advance whether to let employees or other members of the community attend the annual meeting and, if they will, under what conditions.


Companies should consider what security measures they want to have in place for their annual meetings. Security personnel can be useful in providing an orderly meeting if admission rules are being applied, if a large crowd is expected or if a controversial topic is either on the agenda or expected to be raised. Security personnel can also be helpful in dealing with an unruly shareholder or a protest that is disrupting the meeting. Discussions with the security team in advance of the meeting help to assure that the appropriate staffing is in place and that the company's officers, investor relations department and security detail are in agreement on how various scenarios should be addressed.

In the current climate, companies may want to limit what people attending the meeting may bring in with them. This can involve restrictions on the size or number of items. Some companies may want to reserve the right to inspect bags manually or through a screening device. Some may employ the use of x-ray devices similar to those used at airports. It is a good idea to describe such measures in the proxy materials or admission card so that shareholders will know what to expect and can plan accordingly.

Shareholder Proposals

If any shareholder proposals are included in the proxy statement, applicable rules of the Securities and Exchange Commission require the proponent, or a representative of the proponent, to present the proposal at the meeting. Otherwise, a company may choose not to have the proposal voted on by shareholders. Companies may want to touch base with each proponent to determine who will present the proposal. For convenience, the company may want to provide a special seating area for the proponents. Some companies choose to have an investor relations person sit with the proponents to coordinate the shareholder proposal presentation portion of the meeting.

Companies should have a procedure to confirm that an appropriate person is presenting the proposal. If the person at the meeting is not the proponent, either because the proponent is an organization rather than an individual or because the proponent has asked a representative to present the proposal, the company may want to confirm authority. The company should decide in advance whether it will require a written proxy or other authorization to verify the representative's authority to present the proposal on behalf of the proponent or if it will rely on something more informal, such as a telephone call or email from the proponent. In this regard, the company should be aware of any applicable bylaw or governing law provision regarding presenting proposals.

Companies should also decide in advance how they will proceed if neither the proponent nor the proponent's representative attends the meeting. Some companies may choose to present the proposal as a courtesy, since it appeared in the proxy statement, especially if the proxies in hand indicate that the proposal will fail. Rule 14a-8(i)(12) under the Securities Exchange Act of 1934 permits shareholder proposals dealing with substantially the same matter to be excluded from proxy statements within three calendar years from the last time such a proposal was included if the proposal when voted on failed to achieve certain thresholds (between 3 and 10 percent, depending on how many times the proposal was made within the preceding five calendar years). A company may consider it advantageous to allow a matter to be voted upon even if the proponent is not present, if that action would enable the company to exclude a similar proposal, even if from a different proponent, at a subsequent meeting.

If, without good cause, the proponent or the proponent's representative fails to appear at the meeting and present the proposal, Rule 14a-8(h)(3) permits the company to exclude from its proxy materials for the following two calendar years any proposals submitted by that proponent. While there is precedent permitting a company to exclude shareholder proposals on this basis even if the company submits an absentee proponent's proposal to a vote for the convenience of its shareholders,1 companies should be careful not take actions that may waive this right, for example, by asking another shareholder in attendance at the meeting to present the proposal.2

Companies are required to file a Form 8-K with the Securities and Exchange Commission following submission of matters to a vote of shareholders to report the outcome of each such shareholder vote. If a company permits the vote to proceed even though the proposal was not presented by the proponent or the proponent's representative, or if the company otherwise wants to make public that the proposal was not voted upon because of the proponent's failure to appear at the meeting, the company may document in its voting results Form 8-K that the proponent failed to appear or send a representative to present the proposal.

If a shareholder seeks to present a proposal at the meeting that was not included in the company's proxy statement, the company should determine whether its bylaws and applicable law permit such action. Company counsel should plan these in advance to develop an appropriate response should such situation arise.

Technology and the Annual Meeting

Companies should determine whether they want to take advantage of evolving technology in the annual meeting context. "Virtual" meetings are becoming part of the annual meeting landscape, although, currently, annual meetings are generally not exclusively electronic. However, a growing number of companies are supplementing their annual meetings with a web-based component. In some cases, this is audio only, while other companies provide video, letting shareholders see as well as hear the meeting. Some companies offer an interactive virtual meeting experience, permitting shareholders to ask questions online. Companies may post electronic records, or transcripts, of their meetings on their web sites for a period of time so shareholders or others can listen or view them at their convenience. These various electronic options are growing in popularity as methods of opening the meeting to shareholders who are not able to attend the meeting in person.

Some companies choose to use various forms of social media for shareholder communications as part of the annual meeting process. For example, investor relations personnel may find it useful to tweet key points made by the chief executive officer during the meeting (which they may want to prepare and discuss internally before the meeting). Companies may also want to blog about events at the meeting. Because tweets and blogs may not provide widespread dissemination of information, companies using social media in conjunction with the annual meeting should be sure that their representatives understand the selective disclosure implications of Regulation FD (discussed further in "Question and Answer Sessions" below).

Question and Answer Sessions

Many shareholders expect to be able to ask questions of management at the annual meeting, so the Q&A session of the meeting is very important. However, the Q&A session will likely be the most challenging time of the meeting because it is the most unpredictable. Management is often expected to promptly provide answers to unexpected questions. Therefore, it is helpful to inject as much control as possible into the process by establishing and publicizing ahead of time the procedures that shareholders must follow to participate in the Q&A session. Companies may also want to develop contingency plans should anyone attending the meeting ignore the rules or otherwise cause a disruption (see "Security" above).

Companies should specify in advance when shareholders will be able to ask questions or make statements at the meeting; companies also may want to specify time limits for individual questions and statements to avoid shareholders making long speeches. Generally, the Q&A session of the annual meeting will follow the business portion of the meeting. Some companies may prefer that shareholders submit questions in writing during the meeting. This process can have the advantage of eliminating repetition while making sure that questions of concern to multiple shareholders get answered. It also can provide officers with some extra time to prepare a response. However, it is possible that some shareholders may complain that such a process is too controlled and less candid.

The company should decide in advance who will be its representatives in the Q&A session. Will it just be certain management representatives, or will board members also participate? Also, the company should decide if it will let shareholders direct questions to particular officers or directors, or if management will decide among themselves who will answer. If there are some topics that a company will not discuss during the Q&A session (such as personal grievances or current litigation), the company should consider whether it wants to announce that in its introduction to this portion of the meeting.

It is not possible to predict everything that shareholders may ask during the annual meeting, but certain topics can be anticipated. Areas that shareholders may focus on include company performance and strategy, global economic conditions, corporate governance, executive compensation, political contributions, cybersecurity and social and environmental issues, including climate change. Investor relations may want to prepare a script with sample questions and answers, and company officers may want to rehearse a practice Q&A session. If directors might answer questions, or otherwise speak, at the meeting, they also should prepare in advance.

Shareholder meetings are subject to Regulation FD, and any material, nonpublic information disclosed by the company or its representatives during the course of the meeting, including during a Q&A session, must be publicly disseminated in compliance with Regulation FD. This is true even if the meeting is public and/or the press is present. A live webcast or other electronic broadcast of the meeting can constitute public disclosure for Regulation FD purposes if the notice provisions of Regulation FD are followed.3 In any event, companies should plan in advance how to avoid or limit the disclosure of material nonpublic information during the meeting and how to react if inadvertent disclosure occurs.


1. See, for example, McDonald's Corporation (March 3, 2015).

2. See, for example, Sprint Nextel Corporation (March 18, 2013).

3. See Regulation FD CD&I 102.05, CD&I 102.06 and CD&I 102.01, available at https://www.sec.gov/divisions/corpfin/guidance/regfd-interp.htm.

Originally published 28 January 2016

Learn more about our Corporate & Securities practice.

Visit us at mayerbrown.com

Mayer Brown is a global legal services provider comprising legal practices that are separate entities (the "Mayer Brown Practices"). The Mayer Brown Practices are: Mayer Brown LLP and Mayer Brown Europe – Brussels LLP, both limited liability partnerships established in Illinois USA; Mayer Brown International LLP, a limited liability partnership incorporated in England and Wales (authorized and regulated by the Solicitors Regulation Authority and registered in England and Wales number OC 303359); Mayer Brown, a SELAS established in France; Mayer Brown JSM, a Hong Kong partnership and its associated entities in Asia; and Tauil & Chequer Advogados, a Brazilian law partnership with which Mayer Brown is associated. "Mayer Brown" and the Mayer Brown logo are the trademarks of the Mayer Brown Practices in their respective jurisdictions.

© Copyright 2016. The Mayer Brown Practices. All rights reserved.

This Mayer Brown article provides information and comments on legal issues and developments of interest. The foregoing is not a comprehensive treatment of the subject matter covered and is not intended to provide legal advice. Readers should seek specific legal advice before taking any action with respect to the matters discussed herein.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

In association with
Related Topics
Related Articles
Related Video
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions