Shareholder Proposals – Item 8 on Proxy Card
Chris Rossi, Custodian for Vanessa Rossi, P.O. Box
249, Boonville, California 95415, owner of 600 shares
of the Company’s common stock, proposes the
8 — Subject Any Future Poison Pill to a Shareholder
Resolved, Shareholders request that our Board adopt
a bylaw or charter amendment that any future or current
poison pill be subject to a shareholder vote as a
separate ballot item, to be held as soon as possible.
A poison pill is such a drastic step that a required
shareholder vote on a poison pill is important enough
to be a permanent part of our bylaws or charter rather
than a fleeting short-lived policy.
It is essential that a sunset not be used as an escape
clause from a shareholder vote. Since a vote would
be as soon as possible, it could take place within
4-months of the adoption of a new poison pill. Since
a pill is such a drastic measure that deserves shareholder
input, a shareholder vote would be required even if
a pill had been allowed to expire.
Chris Rossi, P.O. Box 249, Boonville, Calif. 95415
sponsors this proposal.
"Poison pills … prevent shareholders, and
the overall market, from exercising their right to
discipline management by turning it out. They entrench
the current management, even when it’s doing
a poor job. They water down shareholders’ votes
and deprive them of a meaningful voice in corporate
"Take on the Street" by Arthur Levitt, SEC
"[Poison pill] That’s akin to the argument
of a benevolent dictator, who says, ‘Give up
more of your freedom and I’ll take care of you.’"
T.J. Dermot Dunphy, CEO of Sealed Air (NYSE) for 25
“That’s the key negative of poison pills
-instead of protecting investors, they can also preserve
the interests of management deadwood as well.”
Morningstar.com, Aug. 15, 2003
Subject Any Future Poison Pill to a Shareholder Vote
Yes on 8
BOARD OF DIRECTORS’ POSITION
Verizon does not have a shareholder rights plan, or
“poison pill.” Moreover, the Board of
Directors has adopted a policy that requires the Board
to seek shareholder approval in the unlikely event
that the Board were to determine that such a plan
The policy is contained in Verizon’s Corporate
Governance Guidelines. It provides that the Board
will not adopt a shareholder rights plan without shareholder
approval. If the Board, in the exercise of its fiduciary
duty, determines that it is in the best interest of
shareholders to adopt a shareholder rights plan, it
will either seek prior shareholder approval or present
the plan to shareholders for their approval within
one year of adopting the plan. If the plan is not
approved by shareholders, it will expire one year
from the date it is adopted and cannot be renewed
or replaced. Any plan adopted by the Board must also
contain a “sunset” provision, providing
that shareholders will have the opportunity to ratify
or reject the plan every three years following the
date of initial shareholder approval.
In the Board’s view, this policy preserves both
its ability to appropriately exercise its fiduciary
duty in a timely manner and the shareholders’
ability to evaluate and act on any shareholder rights
plan or ensure that it expires.
Accordingly, the Board of Directors recommends a vote
AGAINST this proposal.
* This is an interactive electronic version of Verizon’s 2006
Annual Report to Shareholders, and it is intended to be complete and
accurate. The contents of this version are qualified in their entirety
by reference to the printed version. A reproduction of the printed version
is available in PDF format on this website.