(WASHINGTON) – A Teamster-sponsored shareholder proposal at Swift Transportation [NYSE: SWFT] won majority support by public shareholders at the company’s 2015 annual meeting Fri., May 8, 2015.
The proposal, which calls on the board to develop a recapitalization plan to replace the current dual class stock structure with a one-share, one-vote system, received 82 percent support by shareholders of the company’s Class A, publicly traded shares (or 67 percent of all publicly traded shares outstanding) based on results disclosed by the company in its 8-k dated May 11, 2015 and filed with the Securities & Exchange Commission (SEC).
In 2014 the proposal won 79 percent support of Class A shares voted representing 61 percent of all publicly traded shares outstanding.
The current stock structure provides Swift’s CEO Jerry Moyes majority control over a company for which he owns a minority stake.
“It’s time Swift’s board demonstrate its independence and protect the interest of all shareholders,” said Ken Hall, Teamsters General Secretary-Treasurer. “The current system creates opportunity for conflicts of interest between Moyes and other shareholders as well as material, financial risk for the company and its investors.”
According to disclosures in Swift’s 2015 Proxy, CEO Jerry Moyes and certain affiliates have pledged approximately 63 percent of total holdings or approximately 24 percent of the company’s total outstanding shares.
In an April 20, 2015, letter to shareholders, Hall urged investors to vote for the proposal and to withhold support from the company’s incumbent, independent directors who failed to implement the proposal after last year’s strong vote and who have failed to rein in the excessive pledging of stock that puts investors at risk.
The country’s two largest proxy voting advisors, ISS and Glass Lewis, both recommended shareholders support the proposal and withhold support from the company’s independent directors.
More than 40 percent of the publicly traded shares cast in the election of directors withheld support from the independent directors being elected.
“Swift’s board is losing the confidence of the shareholders they are elected to represent,” Hall said. “There is growing frustration with the board’s inaction and patience is running out.”
Founded in 1903, the International Brotherhood of Teamsters represents 1.4 million hardworking men and women throughout the United States, Canada and Puerto Rico. Visit www.teamster.org for more information. Follow us on Twitter @Teamsters and “like” us on Facebook at www.facebook.com/teamsters.