CIRO Proxy Statement & Annual Report 4

Question 1

What is the 'pay ratio' disclosure requirement under the Dodd-Frank Act?

Accepted Answer

The ratio of CEO pay to that of the median employee

Answer

Dodd-Frank Section 953(b) requires companies to disclose the ratio of the CEO's annual total compensation to that of the median annual total compensation of all employees.

Question 2

When must a company file a Form 8-K to announce its annual meeting date if it differs significantly from the prior year?

Accepted Answer

Within 4 business days of setting the new meeting date

Answer

If the annual meeting date changes by more than 30 days from the prior year, the company must file a Form 8-K announcing the new record date within 4 business days of setting it.

Question 3

What is a 'no-action letter' in the context of shareholder proposals?

Accepted Answer

An SEC staff response indicating it will not recommend enforcement action if the company excludes a shareholder proposal

Answer

A no-action letter is issued by SEC staff indicating they will not recommend action against a company for excluding a shareholder proposal under Rule 14a-8.

Question 4

Under Rule 14a-8, what minimum ownership threshold must a shareholder meet to submit a proposal for inclusion in the proxy statement?

Accepted Answer

$2,000 of company stock for 3 years, or $15,000 for 2 years, or $25,000 for 1 year

Answer

Under updated SEC rules effective 2022, shareholders must hold at least $2,000 worth of securities for 3 years, $15,000 for 2 years, or $25,000 for 1 year to submit a proposal.

Question 5

What does 'majority voting' mean in the context of director elections?

Accepted Answer

Directors must receive more 'for' votes than 'withheld' or 'against' votes to be elected

Answer

Under majority voting standards, a director nominee must receive more votes in favor than against (or withheld) from votes actually cast to be elected.

(CIRO) Certified Investor Relations Officer Practice Test

(CIRO) Certified Investor Relations Officer Practice Test

CIRO Proxy Statement & Annual Report 4