{"id":276189,"date":"2010-02-04T10:38:14","date_gmt":"2010-02-04T15:38:14","guid":{"rendered":"http:\/\/www.footnoted.org\/?p=4498"},"modified":"2010-02-04T10:38:14","modified_gmt":"2010-02-04T15:38:14","slug":"shareholders-watch-your-language%e2%80%a6","status":"publish","type":"post","link":"https:\/\/mereja.media\/index\/276189","title":{"rendered":"Shareholders, watch your language\u2026"},"content":{"rendered":"

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If you read enough SEC filings, you begin to recognize certain sections like they’re old friends. \u00a0You might think, \u201cOh!\u00a0 There\u2019s the section on Executive Compensation Discussion & Analysis!\u201d or \u201cHi, Forward-Looking Statements.\u00a0 How are the Risk Factors looking today?\u201d<\/p>\n

But occasionally \u2013 perhaps rarely \u2013 something pops out that you\u2019ve never noticed before.<\/p>\n

Such was the case when we read the proxy statement<\/a> that vitamin and nutritional supplement producer NBTY, Inc.<\/a> (NTY) filed recently. \u00a0At the top of page 10, a passage in the \u201cCommunications\u00a0 to Directors\u201d section gave us pause:<\/p>\n

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\u201c\u2026After the mail is opened and screened for security purposes, it will be logged in, and (other than mail that our General Counsel determines to be trivial or obscene) then forwarded to the particular Director identified, or to the Board as a whole, as requested in the stockholder’s correspondence. Trivial items will be delivered to the Directors at the next scheduled Board meeting. Obscene items will not be forwarded.\u201d<\/p>\n<\/blockquote>\n

Really?\u00a0 Do the directors receive a lot of obscenity-laced mail, or is this just one of those boilerplate sections that legal counsel adds to protect the directors just in case<\/em> the company ever receives an abusive letter that \u2013 if read aloud \u2013 would turn the air in the board room blue?<\/p>\n

Frankly, we expected to find out that it was boilerplate. \u00a0But it turns out that a search on variations of the paragraph above yielded\u00a0only<\/em> NBTY, Inc., which has included similar language in its proxy every year since 2004.<\/p>\n

[As an aside, one might understand shareholder concern \u2013 if not ire \u2013 at some of the disclosures in the proxy.\u00a0 For example, in the Related Transactions section on p. 31, we noticed that in FY 2009, six family members of two of the top executives received either commissions or \u201caggregate compensation and fringe benefits\u201d ranging from just under $500,000 to $1.5 million.]<\/p>\n

Now we\u2019re curious, though.\u00a0 To those of you who see or receive letters from shareholders, is obscene mail addressed to the company’s directors or top executives really a problem?\u00a0 Feel free to discuss\u2026 politely, of course.<\/p>\n

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If you read enough SEC filings, you begin to recognize certain sections like they’re old friends. \u00a0You might think, \u201cOh!\u00a0 There\u2019s the section on Executive Compensation Discussion & Analysis!\u201d or \u201cHi, Forward-Looking Statements.\u00a0 How are the Risk Factors looking today?\u201d But occasionally \u2013 perhaps rarely \u2013 something pops out that you\u2019ve never noticed before. Such […]<\/p>\n","protected":false},"author":4072,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[7],"tags":[],"class_list":["post-276189","post","type-post","status-publish","format-standard","hentry","category-news"],"_links":{"self":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts\/276189","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/users\/4072"}],"replies":[{"embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/comments?post=276189"}],"version-history":[{"count":0,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/posts\/276189\/revisions"}],"wp:attachment":[{"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/media?parent=276189"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/categories?post=276189"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mereja.media\/index\/wp-json\/wp\/v2\/tags?post=276189"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}