This is only the first page of the story. See link for the rest. PS - NY Times will require sign in, i.e. get a userid/password to acess any of their website.
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[url]http://www.nytimes.com/2002/05/09/business/09CND-STAN.html[/url]
Shareholders in Toolmaker Approve an Offshore Tax Plan
May 9, 2002
Shareholders in Toolmaker Approve an Offshore Tax Plan
By DAVID CAY JOHNSTON
NEW BRITAIN, Conn., May 9 — Executives at Stanley Works, a producer of
tools and door products, said today that the company's proposal to
relocate to Bermuda in address only, with its legal residence in Barbados,
was narrowly passed by shareholders.
John M. Trani, Stanley's chairman and chief executive, announced that 67.2
percent of the company's outstanding shares, slightly more than the
minimum two-thirds majority needed, had approved the proposal and that
Stanley would become a Bermuda company by the end of business on Friday.
Mr. Trani said the measure was carried by about 425,000 shares. In an
interview he said three million shares owned by employees in their 401(k)
plans were not voted by the workers. Under the proportional voting system,
the company used 2.5 million of these shares to vote in support of the
Bermuda move, which is almost six times the company's margin of victory.
The unvoted 401(k) shares represented the entire margin of victory.
"Our shareholders have strongly affirmed the benefits of
re-incorporation," Mr. Trani said in a statement, adding, "The global
playing field has been leveled, and our company is now better able to
compete."
But Stanley union members and retirees said they would be in court today
to block the move. They said the proposal to incorporate in Bermuda was
approved only because the company voted shares owned by employees in the
401(k) plan who did not cast proxies.
The company had originally sent a letter to employees saying that unvoted
shares would count as no votes. But in the letters union members said they
received on Saturday, the company said any unvoted shares would be voted
by the trustee of the 401(k) retirement plan. There are 13 million shares
in the 401(k) plan, and Donald D'Amato, president of the machinists union
local, and others estimated that only half of the union members voted
their shares.
According to the company, 57.3 million shares were voted in favor of
re-incorporation. Some 14.9 million shares voted against the measure, 1
million shares abstained and 12 million shares were not voted, the company
said.
The result of the vote was announced at an annual shareholders meeting
held at the company's headquarters today. In the one-hour meeting Mr.
Trani cut off questions after 20 minutes and told the booing crowd, "I run
this meeting."
His answers to shareholders' queries were short, and in response to a
question he told the booing audience that a one-hour annual meeting gave
shareholders all the time they needed to question the management. Mr.
Trani then used more than half of the meeting to speak on topics that
included the lengthy recitation of the company's accomplishments. He also
gave a detailed power point presentation.
Outside the meeting, Denise L. Nappier, Connecticut's state treasurer,
said she was appalled at what she called Mr. Trani's arrogance.
"It was quite rude," Ms. Nappier said. "I don't think that's the way to
talk to the owners of the company."