Key Points
- The Communications Workers of America plans to back five governance proposals at Nexstar’s annual meeting aimed at increasing shareholder oversight.
- Measures include proxy access for board nominations, the ability for shareholders to call special meetings and limits on poison pill provisions.
- The union also criticized CEO Perry Sook’s leadership and Nexstar’s pursuit of its proposed TEGNA acquisition.
The Communications Workers of America (CWA) says it will ask shareholders of Nexstar Media Group to support five proposals at the broadcaster’s upcoming annual meeting.
The union announced Monday that it plans to advocate for five measures aimed at changing the company’s governance structure and increasing shareholder oversight of major corporate decisions. The CWA says its owns positions in Nexstar through common stock purchases.
The effort is being led in part by the National Association of Broadcast Employees and Technicians (NABET-CWA), which represents employees at Nexstar-owned television stations and describes itself as a long-term stakeholder in the company.
NABET-CWA President Charlie Braico said the proposals are intended to address governance concerns at Nexstar, including the company’s leadership structure and labor relations practices. Last October, the company’s Board of Directors renewed the employment agreement of founder-CEO Perry Sook through at least 2029.
“Nexstar’s board lacks independent leadership from Chair and CEO Perry Sook, contributing to a record of governance problems that are harmful to shareholders,” Braico said in a statement. “Despite strong shareholder support for an independent board chair, the company has delayed implementation of this policy as a condition of its employment agreement with Sook and the board has not even appointed a lead independent director.”
Braico also criticized Nexstar’s management over its pursuit of the proposed acquisition of TEGNA and its handling of union recognition disputes at certain stations.
“Now company leadership is engaged in empire-building through the proposed TEGNA transaction to the detriment of shareholders,” Braico said. “These management problems extend to labor relations as well – Nexstar has repeatedly engaged in frivolous appeals, wasting resources rather than complying with administrative and court decisions requiring it to recognize its workers’ unions at multiple locations.”
Among the proposals the union plans to support is a measure calling for the adoption of a proxy access bylaw that would require Nexstar to include shareholder-nominated candidates in its proxy materials for up to 20 percent of seats on the company’s board, provided the nominating shareholder or group holds at least 3 percent of the company’s shares for a minimum of three years.
Other proposals would allow shareholders holding at least 15 percent of Nexstar’s outstanding common stock to call special shareholder meetings and require that any shareholder rights plan, commonly known as a “poison pill,” be submitted for a shareholder vote within one year of adoption or renewal.
The proposals also call for the board chair role to be held by an independent director who has not previously served as a company executive, with a lead independent director appointed if that arrangement cannot be implemented.
A final measure urges Nexstar to require shareholder approval for mergers or acquisitions valued at more than 20 percent of the company’s market capitalization before those deals can be completed.
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