Summary
D.R. Horton, Inc. (DHI) filed an 8-K on November 8, 2017, to report amendments to its corporate bylaws, effective November 2, 2017. The most significant change is the adoption of a 'proxy access' provision, allowing a group of stockholders meeting specific ownership and holding period requirements to nominate director candidates and include them in the company's proxy materials. This empowers long-term, significant shareholders to have a greater voice in board composition. In addition to proxy access, the amendments include updated requirements for director nominees to provide disclosure questionnaires and representations, enhanced advance notice provisions for director nominations and business proposals to include 'control persons,' and administrative updates to align with Delaware General Corporation Law. These changes reflect an effort to modernize corporate governance and increase transparency for stockholders.
Key Highlights
- 1D.R. Horton adopted a proxy access bylaw, allowing qualifying stockholders to nominate directors for inclusion in company proxy materials.
- 2To utilize proxy access, a stockholder or group of up to 20 must own at least 3% of outstanding common stock continuously for at least three years.
- 3Nominees under proxy access can constitute up to 20% of the Board, provided all requirements are met.
- 4Director nominees must now provide completed disclosure questionnaires and make specific representations to the company.
- 5Advance notice provisions were updated to include disclosure requirements for 'control persons' in addition to nominees.
- 6Bylaws were amended to align with current Delaware General Corporation Law, including provisions on written consents, electronic notice, stock certificates, and record dates.
- 7The amendments became effective immediately upon adoption by the Board of Directors on November 2, 2017.