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GM says shareholder groups need 3% stake to nominate directors
[DETROIT] General Motors Co disclosed Tuesday that shareholders or shareholder groups will now be allowed to nominate directors for the board in the company's annual proxy statement, but they will need to hold at least 3 per cent of the automakers' shares for at least three years.
The ownership requirements, had they been in place in Feb 2015, would have been a barrier to proxy access for a group of hedge funds that pushed GM to put former US auto task force member Harry Wilson on the company's board, and accelerate returns of cash to shareholders. That group held about 1.9 per cent of GM shares at the time.
The new rules also state that shareholder groups that meet the share ownership standard may nominate "up to two individuals, or 20 per cent of the board, whichever is greater."
GM directors adopted the new procedure on March 4 as a new article to the company's bylaws, the company stated in a filing with the Securities and Exchange Commission that was released Tuesday evening.
GM didn't have an immediate comment elaborating on the new rules.