[The content of this section is radically re-ordered and much of it radically re-written, but any letters and numbers in parentheses (e.g., (b)(2) refer to the official numbering of sections of the rule.]

A company must include in its proxy statement and form of proxy eligible shareholder proposals and supporting statements.

Eligible shareholder proposals are proposals on eligible subject matter submitted on behalf of eligible shareholders following proper submission procedure.

Eligible subject matter: (a) Any recommendation or requirement that the company and/or its board take action is eligible subject matter (i) except

(1) Improper under state law: if the proposal is not a proper subject for action by shareholders under the laws of the jurisdiction of the company’s organization;

Note to paragraph (i)(1): some proposals are not considered proper under state law if they would be binding on the company if approved by shareholders.

(2) Violation of law: if the proposal would, if implemented, cause the company to violate any state, federal, or foreign law to which it is subject;

Note to paragraph (i)(2): foreign law is disregarded if compliance with the foreign law would result in a violation of any state or federal law.

(3) Violation of proxy rules: If the proposal or supporting statement is contrary to any of the Commission’s proxy rules, including rule 14a-9, which prohibits materially false or misleading statements;

(4) Personal grievance; special interest: If the proposal relates to the redress of a personal claim or grievance against the company or any other person, or if it is designed to result in a benefit to the proposing shareholder not shared by the other shareholders at large;

(5) Relevance: If the proposal relates to operations which account for less than 5 percent of the company’s total assets, net earnings, and gross sales for its most recent fiscal year, and is not otherwise significantly related to the company’s business;

(6) Absence of power/authority: If the company would lack the power or authority to implement the proposal;

(7) Management functions: If the proposal deals with a matter relating to the company’s ordinary business operations;

(8) Director elections: If the proposal (v) could affect the outcome of the upcoming election of directors, including by (i) disqualifying a current nominee; (ii) removing a current director; (iii) questioning the competence, business judgment, or character of a current nominee or director; (iv) including a specific nominee in the company’s proxy materials.

(9) Conflicts with company’s proposal: If the proposal directly conflicts with one of the company’s own proposals to be submitted to shareholders at the same meeting;

(10) Substantially implemented: If the company has already substantially implemented the proposal;

(11) Duplication: If the proposal substantially duplicates another proposal previously submitted to the company by another proponent that will be included in the company’s proxy materials for the same meeting;

(12) Resubmissions: If the proposal addresses substantially the same subject matter as proposals included within the last 3 calendar years if the last proposal received less than 5% of the vote (or 15% or 25% if voted on twice or thrice, respectively, in the last 5 calendar years)

(13) Specific amount of dividends: If the proposal relates to specific amounts of dividends.

Eligible shareholders: Anyone who

(b)(1)(i)/(vi) has continuously and individually held¹ at least $2,000/15,000/25,000 in market value of the company’s securities entitled to vote on the proposal for at least 3²/2/1 year(s) by the date of submitting the proposal,

(b)(1) submits written statements of

(ii) the intention to hold the requisite amount of securities through the date of the meeting,

(iii) availability to meet with the company in person or via teleconference between 10 and 30 calendar days after submission, including contact information and specific times during regular business hours at the company’s executive offices, and

(iv) if submitting through a representative³ , signed support for the specific proposal, as well as identifying information of the representative,
and

(f)(2)/(h)(3) has not, in relation to another proposal in the last two calendar years, violated the promise to hold the securities through the meeting or, without good cause, failed to present the proposal at the meeting.

Proper submission procedure: Any person can only submit

(c) one proposal per meeting (including proposals on behalf of other shareholders),

(d) of not more than 500 words (including any supporting statement), and

(e) at least 120 calendar days before the date of the company’s proxy statement for last year’s annual meeting (or if this year’s date differs by more than 30 days, last year’s meeting was not held, or it is for a special meeting, a reasonable time before the company prints its proxy materials).

Procedure for excluding the proposal (i.e., for contesting eligibility): (j) The company may exclude the proposal only after filing its reasons with the Commission (with copy to the shareholder) no later than 80 calendar days before it files its definitive proxy statement with the Commission, unless otherwise permitted by the Commission staff for good cause. (g) The company bears the burden of persuading the Commission that the proposal is not eligible. (k) The shareholder may submit a response.

(f)(1) A failure by the submitting shareholder to provide proper documentation of share ownership, keep the proposal to 500 words or less, or submit only one proposal, is grounds for exclusion only if the shareholder does not remedy this failure within 14 days (postmark or electronic submission) of being notified by the company in writing (which the company must do within 14 calendar days of receiving the original proposal, advising the shareholder of the time frame for the response).

Procedure if the proposal is included

Company’s proxy statement and form: The company’s proxy statement

(l)(1) must include the shareholder’s name, address, and number of voting securities held (or, alternatively, a statement that it will provide the information to shareholders promptly upon receiving an oral or written request).

(m)(1) may include an opposing statement by the company explaining why the company believes shareholders should vote against the proposal.

(3) If the company includes an opposing statement, it must send the shareholder a copy no later than 30 calendar days before it files it definitive proxy statement.

However, if the company’s opposing statement relates to a revised shareholder proposal submitted pursuant to the Commission’s no-action response requiring such revisions as a condition to requiring the company to include the proposal in its proxy materials, then the company must provide the copy of its opposition statement to the shareholder no later than 5 calendar days after it receives the revised proposal.

Presentation at the meeting: (h) The shareholder or a representative must present the proposal in accordance with state law procedural rules (1) at the meeting, or (2) through electronic media if the company holds its shareholder meeting in whole or in part via electronic media and permits presentation of the proposal via such media.

Liability: (l)(2) The company is not responsible for the contents of the shareholder’s proposal or supporting statement.

¹ (b)(2) such ownership must be demonstrated by record ownership, a written statement of beneficial ownership by the record owner, or schedules 13D/G or forms 3, 4, or 5

² (b)(3) [transition rule] holdings for one year as of 1/4/2021 and continuing since then are grandfathered until 1/1/2023.

³ (v) Unless the shareholder is an entity and the representative’s authority is apparent and self-evident.