What is proxy access and why is Amazon implementing it?

Proxy access is a provision in a company's bylaws that allows eligible shareholders to nominate their own candidates for the board of directors and have those nominees included in the company's official proxy materials. Amazon is implementing it after engaging with its largest shareholders and in response to shareholder feedback, despite a previous proposal not receiving majority support.

What are the requirements for a shareholder to use proxy access?

A shareholder, or a group of up to 20 shareholders, must collectively own at least 3% of the Company's outstanding common stock continuously for a minimum of three years to be eligible for proxy access.

How many directors can a shareholder nominate through proxy access?

Eligible shareholders can nominate director candidates constituting up to 20% of the Board of Directors, provided they meet all the specific requirements outlined in the amended Bylaws.

When do these bylaw changes become effective?

Most of the bylaw amendments, including the core proxy access provisions, are effective immediately as of February 24, 2016. However, the specific change to the deadline for advance notice of business or nominations for annual shareholder meetings will become effective on April 12, 2016, to ensure the notice period for the 2016 annual meeting remains consistent with the previous year.

AMZN 8-K: Corporate Changes

Summary

Amazon.com, Inc. (AMZN) filed an 8-K on February 25, 2016, to announce amendments to its Amended and Restated Bylaws, primarily focused on the implementation of proxy access. This change allows eligible shareholders to nominate directors to the company's board and have them included in Amazon's proxy materials. The decision to implement proxy access follows discussions with major shareholders after a related shareholder proposal was rejected at the 2015 annual meeting. This move signifies Amazon's responsiveness to shareholder feedback and a step towards enhanced corporate governance.

Key Highlights

1Amazon.com, Inc. has amended its Bylaws to implement proxy access, effective immediately for most provisions.
2Proxy access allows shareholders meeting specific ownership thresholds and holding periods to nominate directors.
3Eligible shareholders can nominate up to 20% of the Board of Directors to be included in company proxy materials.
4The threshold for proxy access nomination is 3% of outstanding common stock held continuously for at least three years.
5The decision to adopt proxy access was influenced by shareholder feedback after a non-binding proposal at the 2015 annual meeting.
6Amendments also include adjustments to deadlines for shareholder meeting notices and other clarifying changes.

AMAZON COM INC 8-K Report, Bylaw Amendment (Feb 25, 2016)

Summary

Key Highlights

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