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ARCH CAPITAL GROUP LTD. 8-K Report, Shareholder Vote Results (May 5, 2017)

Filed May 5, 2017For Securities:ACGLACGLNACGLO

Summary

Arch Capital Group Ltd. (ACGL) filed an 8-K on May 5, 2017, detailing the results of its annual shareholder meeting held on May 4, 2017. A significant majority of the company's shares, approximately 91%, were represented, indicating strong shareholder engagement. The meeting's primary agenda items included the election of Class I directors and Designated Company Directors, the ratification of PricewaterhouseCoopers LLP as the independent auditor, and advisory votes on executive compensation and its frequency. All proposed items received overwhelming support from shareholders, with director elections and auditor ratification passing with substantial 'for' votes and very few 'against' or 'abstain' votes. The 'say-on-pay' advisory vote also passed, though with a more divided result compared to other items. Additionally, the Board of Directors declared preferred share dividends for both Series C and Series E preferred shares, payable in June and September 2017. This filing provides transparency on corporate governance decisions and ongoing dividend distributions.

Key Highlights

  • 1Over 91% of outstanding shares were represented at the annual shareholder meeting, demonstrating significant shareholder participation.
  • 2All three Class I directors nominated for election were overwhelmingly approved by shareholders.
  • 3A broad slate of Designated Company Directors for ACGL's non-U.S. subsidiaries was also approved with very strong support.
  • 4PricewaterhouseCoopers LLP was ratified as the company's independent registered public accounting firm for 2017 with overwhelming shareholder approval.
  • 5The advisory vote on executive compensation ('say-on-pay') received majority support, though with a notable number of 'against' votes, indicating some shareholder concern.
  • 6Shareholders overwhelmingly supported an annual advisory vote on executive compensation going forward.
  • 7The Board of Directors declared semi-annual dividends for Series C and Series E preferred shares, payable in June and September 2017, indicating continued capital distribution to preferred shareholders.

Frequently Asked Questions

The meeting resulted in the overwhelming approval of director elections, the ratification of the independent auditor, and an advisory vote on executive compensation. Shareholders also supported an annual frequency for the advisory executive compensation vote. Additionally, dividends were declared for preferred share series.

While the advisory vote on executive compensation ('say-on-pay') received majority support, a significant portion of votes were cast against it (approximately 29 million votes against versus 77 million for). This suggests that while the compensation plan was approved, there was notable shareholder dissent that investors should monitor.

The Board declared dividends for Series C 6.75% Non-Cumulative Preferred Shares ($0.01 par value) at a rate of $0.421875 per share, payable on June 30, 2017, and September 30, 2017. Dividends were also declared for Series E 5.25% Non-Cumulative Preferred Shares (each representing a 1/1000th interest in a share with a $25,000 liquidation preference) at a rate of $0.328125 per depositary share, also payable on June 30, 2017, and September 30, 2017.

Shareholder participation was strong, with 112,231,702 common shares represented, which constituted approximately 91 percent of the outstanding shares entitled to vote as of the record date.