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SWY » Topics » Statement of Nick Rossi

This excerpt taken from the SWY DEF 14A filed Mar 27, 2009.

Statement of Nick Rossi

 

Special meetings allow shareowners to vote on important matters, such as electing new directors, that can arise between annual meetings. If shareowners cannot call special meetings, management may become insulated and investor returns may suffer. Shareowners should have the ability to call a special meeting when a matter is sufficiently important to merit prompt consideration.

 

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Fidelity and Vanguard supported a shareholder right to call a special meeting. Governance ratings services, including The Corporate Library and Governance Metrics International, took special meeting rights into consideration when assigning company ratings.

 

This proposal topic won impressive support at the following companies (based on 2008 yes and no votes):

 

Occidental Petroleum (OXY)

    66 %   Emil Rossi (Sponsor)

FirstEnergy Corp. (FE)

    67 %   Chris Rossi

Marathon Oil (MRO)

    69 %   Nick Rossi

 

The merits of this Special Shareowner Meetings proposal should also be considered in the context of the need for further improvements in our company’s corporate governance and in individual director performance. In 2008 the following governance and performance issues were identified:

 

  •  

The Corporate Library www.thecorporatelibrary.com, an independent investment research firm, rated our company:

“D” in Corporate Governance.

“High Governance Risk Assessment.”

“Very High Concern” in executive pay.

  •  

Steven Burd was awarded 1M options in 2007. The large size of these options raised concerns over the link between executive pay and company performance given that small increases in our stock price (which can be completely unrelated to management performance) can result in large financial gains for Mr. Burd.

  •  

Our 2008 annual meeting was arguably held in Hawaii at 8:00 a.m. to avoid shareholders.

  •  

Three directors had 15 to 22 years director tenure (independence concern) and also held 4 seats on our key board committees:

Steven Burd

Paul Hazen – our Lead Director

Robert MacDonnell

  •  

We had no shareholder right to:

Cumulative voting.

Call a special meeting.

An independent Board Chairman.

  •  

Our directors also served on 5 boards rated “D’ by the Corporate Library:

Steven Burd    Kohl’s (KSS)
Paul Hazen    KKR Financial Holdings (KFN)
Mohan Gyani    Keynote Systems (KEYN) – also owns zero Safeway stock.
Frank Herringer    Charles Schwab (SCHW)
Raymond Viault    VF Corp. (VFC)
  •  

Yet five of our directors served on no other significant corporate boards – Experience concern.

 

The above concerns shows there is need for improvement. Please encourage our board to respond positively to this proposal:

 

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