The Corporate Monitoring Newsletter

Issue #6 - March 2000

Written by Mark Latham

IN THIS ISSUE:

1. "SAVI Proposal" In Two Companies' Proxies

2. Corporate Monitoring Discussion Forum on WWW

3. News on SEC Rule 14a-8: Shareowner Proposal Strategies
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1. "SAVI PROPOSAL" IN TWO COMPANIES' PROXIES

Shareowners' Alternative Voting Information -- our SAVI
Proposal [pronounced "savvy"] to hire a proxy advisory firm
chosen by shareowner vote will give shareowners independent
information and a more powerful voice in corporations.

The Corporate Monitoring Project has succeeded at getting
the SAVI Proposal into the year-2000 proxy at two companies:
Whole Foods Market (WFMI) and Washington Mutual (WM). Text
of proposals and further info are at http://www.corpmon.com

The Whole Foods proxy was filed February 25, so shareowners
are already voting. I will present the proposal at their
meeting, March 27 in Chicago.

The Washington Mutual proxy will be mailed to shareowners
March 22. Annual meeting is April 18 in Seattle, where I
will present again.

We are contacting shareowners to urge them to vote for the
proposal. Please help spread the word! Responses to
Frequently Asked Questions are at
http://www.corpmon.com/ProposalFAQ.htm

It takes time to build understanding and acceptance of a new
idea. I didn't take it seriously myself until 8 years after
conceiving it. We are in this for the long haul. Unlike
most proposals, this one can be submitted to any widely held
company. Many companies have their annual meetings outside
the usual April time slot, so we need not wait for an annual
cycle. Several more submissions are already in our pipeline.

Although management at some companies may ignore the wishes
of a majority of owners, an opposing board slate can win
election by promising to implement those wishes.
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2. CORPORATE MONITORING DISCUSSION FORUM ON WWW

Discuss the pros and cons of corporate monitoring and the
SAVI Proposal. This message board is on the web at
http://boards.fool.com/Messages.asp?id=1380545000001000
For future convenience, bookmark the page while you're there.

Anyone can read messages posted there, but you have to be a
Fool to post a message! That's right, a registered member of
the Motley Fool community (it's free). Although I created
the forum in December, this is the first time I've told a
substantial number of people about it.
_____________________________________________________________

3. NEWS ON SEC RULE 14A-8: SHAREOWNER PROPOSAL STRATEGIES

The SAVI Proposal campaign sparked some new arguments and SEC
decisions on Rule 14a-8, which determines whether management
can exclude a shareowner proposal from the company proxy.

We won on Rule 14a-8(i)(1) -- "improper under state law".
If the proposal is worded as a request, the SEC determined
that it is not excludable (letter to Washington Mutual,
February 22, 2000).

We won on Rule 14a-8(i)(7) -- "ordinary business".
In the same letter, the SEC disagreed with management's view
that the proposal could be excluded on the grounds that it
deals with ordinary business decisions.

We lost on Rule 14a-(i)(8) -- "relates to director election".
Because the proxy advisory firm would give advice on all
voting matters, including director elections, the SEC deemed
the proposal excludable. Seven target companies made this
argument, so the proposal is not in their proxies this year.
Starting next month, we will submit proposals to hire a proxy
advisory firm to advise on all voting matters except director
elections.

Interesting arguments were made regarding other sections of
Rule 14a-8, especially relating to whether a proposal can
include a website URL. Unfortunately, the SEC made no
determination because those proposals were already deemed
excludable under Rule 14a-(i)(8).

We are in the process of posting the full text of all these
arguments and decisions at http://www.corpmon.com/SEC.htm .
Whole Foods Market did not try to exclude the proposal, so
there were no arguments in that case.

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