Currently it takes a theoretical 20% of all shares outstanding to call for a special shareholder meeting. However the face value of 20% is deceiving because there are factors than increase the 20% face value significantly.
This theoretical 20% of all shares outstanding translates into 25% of the shares that vote at EBAY annual meeting. It would be hopeless to think that EBAY shares, that do not have the time to vote, would have the time to go through the special procedural steps to call for a special shareholder meeting.
And it goes downhill from here. Shares that are not held net long are excluded. Thus shareholders who own 20% of EBAY stock, that equals 25% of the stock that votes at the EBAY annual meeting, could determine that they hold 30% of EBAY stock when shares owned other than net long are included.
A potential 30% stock ownership threshold to call for a special shareholder meeting is nothing for the EBAY Board to brag about.
Plus EBAY shareholders have no right to act by written consent. A large number of companies provide shareholders with the right to act by written consent and the right to call a special shareholder meeting.
The 10% figure is reasonable because some states require that 10% of shares have the right to call a special shareholder meeting.
Calling for a special shareholder meeting is hardly ever used by shareholders but the main point of the right to call for a special shareholder meeting is that it gives shareholders at least significant standing to engage effectively with management at a time when the Board needs to adopt new strategies.
Management will have an incentive to genuinely engage with shareholders, instead of stonewalling, if shareholders have a realistic Plan B option of calling a special shareholder meeting.
One can say that EBAY has been in a slump since 2021 when EBAY was at $76. In late 2024 EBAY was at only $63.
To guard against the EBAY Board of Directors becoming complacent during the curret EBAY stock price slump shareholders need the ability to call a special shareholder meeting to help the Board adopt new strategies when the need arises.
The 47% EBAY shareholder support for this proposal topic in 2023 would likely have exceeded 51% support if EBAY management had not gone to the corporate war chest and flooded shareholders with messages to vote against the 2023 proposal and, in a paradox of reasoning, vote against increasing their own rights as EBAY shareholders