The Coca-Cola Company [email protected]
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January 6, 2014 Jared M. Brandman The Coca-Cola Company [email protected] Re: The Coca-Cola Company Incoming letter dated December 12, 2013 Dear Mr. Brandman: This is in response to your letter dated December 12, 2013 concerning the shareholder proposal submitted to Coca-Cola by the National Center for Public Policy Research. We also have received a letter from the proponent dated December 31, 2013. Copies of all of the correspondence on which this response is based will be made available on our website at http://www.sec.gov/divisions/corpfin/cf-noaction/14a-8.shtml. For your reference, a brief discussion of the Division’s informal procedures regarding shareholder proposals is also available at the same website address. Sincerely, Matt S. McNair Special Counsel Enclosure cc: Justin Danhof The National Center for Public Policy Research [email protected] January 6, 2014 Response of the Office of Chief Counsel Division of Corporation Finance Re: The Coca-Cola Company Incoming letter dated December 12, 2013 The proposal relates to a report. There appears to be some basis for your view that Coca-Cola may exclude the proposal under rule 14a-8(f). We note that the proponent appears to have failed to supply, within 14 days of receipt of Coca-Cola’s request, documentary support indicating that it has satisfied the minimum ownership requirement for the one-year period required by rule 14a-8(b). Accordingly, we will not recommend enforcement action to the Commission if Coca-Cola omits the proposal from its proxy materials in reliance on rules 14a-8(b) and 14a-8(f). In reaching this position, we have not found it necessary to address the alternative bases for omission upon which Coca-Cola relies. Sincerely, Raymond A. Be Special Counsel DIVISIO·N OF CORPORATiON: FINANCE. INFORMAL PROCEDURES REGARDING S~HOLDER PROPOSALS T~e Division ofCorporation Finance believes that its responsibility wi~ respect to tnatters arising under Rule l4a-8{17 CFR.240.14a-8], as with other matters under the proxy .rides, is to ·a~dthose ~ho must comply With the rule by offering informal advice and suggestions and'to determine, initially, whether or not it may be appropriate in a particular matter to_ recommen~. enforcement action to the Commission. In co~ection with a shareholder proposal ~der Rule .14a-8, the Division's.staff considers th~ iiiformation furnished to it·by the Company in support ofits intention to exclude ~e proposals fro~ the Company's proxy materials, a<; well as any inform~tion furnished by the proponent or· the proponent's representative. AlthOugh Rule l4a-8(k) does not require any comm~cations from shareholders to the C~mffiissiort's s.taff, the staffwill always. consider information concerning alleged violations of the statutes a~nistered by the.Conunission, including argwnent as to whether or notactivities propos~ to be taken ·would be violative·ofthe·statute ornile inv:olved. The receipt by the staff ofsuch information; however, should not be construed as ch3ngjng the statrs informal procedureS and· proxy review into a fonn.al or adversary procedure. It is important to note that the starrs ~d. Commissio~' s no~action responses to Rule 14a-8G} submissions reflect only infornial views. The ~terminations· reached in these no action letters do not and cannot adjudicate the ~erits ofa company's position With respect to the proposal. Only acourt such a5 a U.S. District Court.can decide whether acompany is obligated .. lo inclu~e shareholder.proposals in its proxy materials·. Acc0~ingly a discretion~ · determination not to recommend or take· Commission enforcement action, does not pr~clude a pr-oponent, or any shareholder ofa ·company, from pursuing any rights be or she may have against the company in court, should the manag~ment omit the proposal from ·the companyts .prdxy ·material. · THE NATIONAL CENTER *** FOR PUBLIC POLICY RESEARCH David A. Ridenour Amy M. Ridenour Pres id ent C hai r ma n Dece mber 31. 20 13 Via Email : shareholde rproposa ls@ sec.gov Ofl·ice o f Chief Co unsel Di vision of Corpora tion Finance Securit ies a nd Exchange Commiss io n I 00 F Street. E Was hing to n. DC 20549 RE: Stockholde r Proposa l o r the Nat ional Ce nter for Public Po lic y Research. Securities Excha nge Ac t of 1934 - Rule 14a-8 Dear S ir or Madam. Thi s lette r is in respo nse to th e letter of Ja red M. Brand man on be half of the Coca-Co la Compa ny (the '"Company") da ted December 12. 20 13, requesting that yo ur offi ce (the ··commi ssion·· or .. Staff.) take no act ion if the Company omits o ur Shareho lder Proposal (t he ·' Proposa l"") fro m its 20 14 proxy mate rial s for its 20 14 a nnual shareholder meeting. RESPONSE TO COCA-COLA's CLAIMS Th e Company makes ma ny material misrepresentations conc erning o ur Proposal in its no-ac ti on request. The Compa ny is in possess io n of the owne rship doc um ents needed to verify that the Nationa l Cen te r for Publi c Poli cy Research is indeed a shareholder that is eli gibl e to submit a proposal to the Co mpany. Th is iss ue is now moot. The Company st rains to claim they have substantiall y impl emented our Proposa l. yet nowhere in its accompa nying docume ntatio n does the Co mpany suppl y the primary informati on our Pro posa l seeks- a n acco untin g of political and electionee ring donations that are inco ngruous with the Compa ny's stated business phil osophy. To cover for its lack of doc umentati on. the Co mpany impe rmi ssibl y w rites tha t lang uage right out o f our Proposa l. The Compa ny may have an expansive list of its po litica l donations. but that is not what the Proposal requests. Finally, the Staff has already rul ed that a nearl y identi ca l proposa l to ours was no t vague. 501 Capitol Court, N.E., Su ite 200 \Vashi nl!tOn , D.C. 10002 (202) 54H110 *Fax (202 ) 543·5975 info@nati onalccntc r.o rg * www.nationa lccntc r. o rg The Company has the burden of persuading the Staff that is may exclude our Proposal from its 2014 proxy mate rials. StaffLegal Bulletin No. 14 (CF) (July 13, 2001) (" SLB 14"). For the fo llowing reasons, the Company has fallen short of this burden. Tlt e Company May No t Exclude tlte Proposal Under Rule 14a-8(b) and Rule 14a 8(f)(l) Because tlte Company is in Possession oftlte Owners/tip Documents, Confirming tltat tlte Proponent is Indeed a Company Sltarelwlder Eligible to Submit a Proposal The facts are not in di spute . The Proposal was sent to the Company on November 8, 2013 . On November 14, 2013 , the Company requested proo f ofownership . We contacted our broker and received the proper ownership materi als on November 19, 2013. Due to an internal office cle rical error, those mate rials were not se nt. The Propone nt was operating under the assumption tha t the ownership documents were se nt to the Company via e mail on November 19. 2013. O n December 12, 20 13 , the Company sent its no action request indicating it had not received the ownership d oc ume ntation. Within that same afternoon. we submitted the documentation via e mail to the Company. The Company co nfirmed receipt. Coca-Cola has certainly had eno ugh time to validate o ur ownership materials. As General Co unsel of the National Center for Public Policy Research, I called Mr. Brandman to immediate ly inform him that we were operating under the assumption that our ownership materials were sent on November 19 , 20 13. We discovered that due to an internal clerical error, the information was not sent, and immed iate ly corrected the pro blem. In our conversation, Mr. Brandman evinced that the Company would evaluate our documents a nd consider mak ing an allowance by dropping the Rul e 14a-8(b) and Rule 14a-8(f)( I) sections from their no-action request. By a phone call on December 17, 2013 . the Company officiall y refu sed to remove the Rule 14a-8(b) a nd Rule 14a-8(f)(l) porti on of their no-action request. The Co mmission's Permissive Language and Legal Guidance Provide Latitude Allowing Shareholders to Correct Ownership Deficiencies - Even Well Into the No -Action Process The Commi ssion 's g uida nce cl earl y favo rs allowing proponents to correct procedural e rrors in sha re ho lder submi ssio ns. In fact. well into the no -action process, the Commission allows propo ne nts to fix proposal e rrors to draw them into compliance with Commission rules. Specifically, the Commission's guidance states that the Staffcan afford a proponent additi onal time to submit ownership documents. See Staff Legal Bull etin No. 14 (CF) (July 13, 200I ) ("our no-action response may afford the shareho lder seven days to provide documentation demonstrating that he or she satisfies the minimum ownership require ments contained in rule 14a-8(b)") . Furthe rmore, the re is no Commission mandate allowing the Company to a utoma tically exclude the Proposal for our alleged fai lure to cure a defect within the 14-day w indow. According to the Commission, ·' [f]ailure to cure the defect(s) or respond in a time ly manner may result in exclusion of the proposal." SLB 14 (emphasis added).