U.S. Securities and Exchange Commission
Washington, DC 20549
NOTICE OF EXEMPT SOLICITATION
1. Name of the Registrant:
CHEVRON CORPORATION
2. Name of the person relying on exemption:
LONGVIEW LARGECAP 500 INDEX FUND
3. Address of the person relying on exemption:
C/O AMALGAMATED BANK, 275 SEVENTH AVENUE, NEW YORK, NY 10001
4. Written materials. Attach written materials required to be submitted
pursuant to Rule 14a6(g)(1):
(AMALGAMATED BANK LOGO)
Dear fellow Chevron shareholder:
We urge you to VOTE FOR ITEM NO. 4 when you vote your proxy for Chevron's
May 30th annual meeting. Our proposal asks Chevron to repeal a bylaw, which the
Board of Directors adopted unilaterally with no shareholder vote, to limit
certain types of lawsuits exclusively to courts in Delaware, where Chevron is
incorporated.
Amalgamated Bank's LongView Funds, the sponsor of this proposal, are
long-term shareholders with 541,424 shares of Chevron stock. We urge you to
vote for this proposal because the bylaw deprives Chevron investors of their
statutory right to choose the forum, if need be, in which to bring a suit to
seek recourse for corporate malfeasance. It is also overbroad because it covers
investor suits where no need for this legal restriction has been demonstrated.
WE BELIEVE THAT THE BOARD'S UNILATERAL ACTION TO DIMINISH SHAREHOLDER
PROTECTIONS UNNECESSARILY OVERREACHES AND REMAINS FLAWED.
Here is the background. Companies complain of getting sued in multiple
courts when they announce an M&A deal, with plaintiffs challenging the value of
the deal to shareholders. Whereas in federal securities litigation, multiple
suits tend to be consolidated into one court with one lead plaintiff, there is
no mechanism to consolidate M&A, or "deal cases," which arise under state law
and can be brought in a number of jurisdictions. Because multiple deal cases
may present the risk of a single judge enjoining the transaction, deal cases may
pose challenges not present in securities cases.
Chevron's bylaw seeks to achieve consolidation. We understand Chevron's
concerns and discussed them with the Company, which responded in March 2012 by
revising the exclusive forum bylaw to address some - but not all - of the
concerns we raised. We believe that the bylaw, even as revised, remains
critically flawed. We thus urge shareholders to vote FOR Item 4.
- THE BYLAW, EVEN AS AMENDED, TAKES AWAY SHAREHOLDER RIGHTS CREATED BY
STATUTE. The choice of where investors may file suit is generally determined by
statute. Chevron's bylaw short-circuits that statutory right by board fiat.
- CHEVRON ADOPTED THIS BYLAW WITHOUT GIVING SHAREHOLDERS A VOTE. The only
Delaware court case directly on point indicates that any change of this sort
should be made by amending the company's charter - on which shareholders have a
vote. By making this change through a bylaw, Chevron's Board bypassed the need
to ask shareholders if they want to give up their right to choose where to file
a suit.
________________________________________________________________________________
275 SEVENTH AVENUE NEW YORK, NY 10001 WWW.AMALGAMATEDBANK.COM
- THE BYLAW, EVEN AS REVISED, IS OVERBROAD. The revised bylaw does not
limit itself to simply consolidating "deal cases" in Delaware courts. Instead,
it extends to investor suits on a range of topics without any demonstration of a
need to override an investor's choice of forum, i.e., cases seeking recourse for
alleged failures of Board oversight, such as challenging a company's handling of
environmental performance or oil spills, excessive executive pay, failed
oversight of alleged bribery or corruption cases, failed compliance with other
regulatory or legal requirements, etc., regardless of where the events occurred.
- THE BYLAW IS OF DUBIOUS LEGALITY. As noted, Chevron adopted this bylaw
without a shareholder vote, and the Company is currently being sued by another
shareholder for that omission. The case is pending. Interestingly, at least
ten other companies that had adopted similar bylaws recently repealed such
bylaws in response to shareholder concerns.
- THE COUNCIL OF INSTITUTIONAL INVESTORS AND GLASS LEWIS OPPOSE EXCLUSIVE
FORUM PROVISIONS. The Council of Institutional Investors - a coalition of
public, corporate, and labor funds representing $1.3 trillion in assets - has
approved a policy guideline discouraging companies from adopting exclusive venue
provisions. In December 2011, proxy advisor Glass Lewis announced the following
position:
We believe that any charter or bylaw provision limiting a shareholder's
choice of legal venue is not in the best interests of shareholders. Such
clauses may effectively discourage the use of shareholder derivative claims
by increasing Their associated costs and making them more difficult to
pursue. As such, shareholders should be wary about approving any limitation
on their legal recourse including limiting themselves to a single
jurisdiction (e.g., Delaware) without compelling evidence that it will
benefit shareholders. For this reason, we generally recommend that
shareholders vote against any bylaw or charter amendment seeking to adopt
an exclusive forum provision.
It would be one thing if Chevron had drafted a provision addressing only
"deal cases" and presented it to its shareholders with an explanation of its
need. We have told Chevron that we are willing to further discuss the issue
with them, yet the Board seems content to have made only the technical
modifications in the revised bylaw.
We therefore urge you to VOTE FOR ITEM 4. A vote "for" this proposal will
not prevent Chevron from trying to come back with a more carefully crafted
proposal. It will, however, send a message that shareholders do not want
statutory rights taken away without a vote.
Please do not hesitate to call me if you would like to discuss this at
(212) 895-4923.
Sincerely,
/s/ Scott Zdrazil
Scott Zdrazil
First Vice President-Corporate Governance
THIS IS NOT A SOLICITATION OF AUTHORITY TO VOTE YOUR PROXY. PLEASE DO NOT SEND
US YOUR PROXY CARD, AS IT WILL NOT BE ACCEPTED.
275 SEVENTH AVENUE NEW YORK, NY 10001 www.amalagamatedbank.com