A shareholder of Intel Corporation has filed a complaint in the United States District Court for the Southern District of New York. The shareholder seeks a preliminary and permanent injunction and any other appropriate relief with respect to a stockholder vote to approve the amendment and restatement of Intel’s 2006 equity incentive plan to add 33 million shares to the plan and extend its term.
According to the complaint, Intel’s proxy statement does not include the information required by Item 10(a)(1) of Schedule 14A. That Item specifically requires that “[i]f action is to be taken with respect to any plan pursuant to which cash or noncash compensation may be paid or distributed,” the proxy statement soliciting this vote must “[d]escribe briefly the material features of the plan being acted upon, identify each class of persons who will be eligible to participate therein, indicate the approximate number of persons in each such class, and state the basis of such participation.”
The complaint states Intel’s disclosure falls short because it only states “Intel has a long-standing practice of granting equity awards not only to its executives and directors but also broadly among its employees. In 2016, approximately 84% of Intel’s employees received an equity award.” It also has a table that reports, “Eligible participants: All of our full-time and part-time employees, where legally eligible to participate, and our non-employee directors.”
In a hearing on April 25, 2017, the plaintiff withdrew its request for a preliminary injunction.