Annaly Capital Management | Right To Act By Written Consent at Annaly Capital Management

Status
Filed
Previous AGM date
Resolution details
Lead filer
John Chevedden
Resolution ask
Adopt or amend a policy
ESG theme
  • Governance
ESG sub-theme
  • Shareholder rights
Type of vote
Shareholder proposal
Filer type
Shareholder
Company HQ country
United States
Resolved clause
RESOLVED : Shareholders request that the board of directors take the necessary steps to permit written consent by the shareholders entitled to cast the minimum number of votes that would be necessary to authorize an action at a meeting at which all shareholders entitled to vote thereon were present and voting (without any discrimination or restriction based on length of stock ownership). This includes shareholder ability to initiate any appropriate topic for written consent.
Supporting statement
Annaly Capital shareholders have a particular need for the right to act by written consent because it is considerably more difficult than necessary for NLY shareholders to call for a special shareholder meeting. Delaware law considers it reasonable for 10% of shareholders to call a special meeting ? yet NLY made the threshold 25% of shareholders based on all shares outstanding. The threshold 25% of shareholders based on all NLY shares outstanding is only a token right to call for a special shareholder meeting. If NLY claims otherwise then NLY can give one example of the shareholders of any company the size of NLY or larger that have ever called for a special shareholder meeting and the meeting actually took place. Acting by written consent is hardly ever used by shareholders but the main point of having a right to act by written consent is that it gives shareholders greater standing to engage effectively with management when NLY is underperforming. Now could be a good time for this proposal due to the long-term underperformance of NLY stock. NLY stock was at $50 in 2017 and at only $21 in late 2025 despite a robust stock market. If NLY directors and management know that NLY shareholders can act by written consent they will have a greater incentive to perform. Challenging news reports regarding NLY emerged in 2025 and it would be easy for shareholders to find similar news reports for 2026: Potential regulatory changes in the housing finance sector (e.g., related to Fannie Mae and Freddie Mac) could impact future operations and add risk. Unpredictability surrounding U.S. trade and tariff policies contributed to market uncertainty. NLY?s business model relies on significant leverage to enhance returns on its mortgage-backed securities (MBS) portfolio, which exposes shareholders to substantial interest rate risk. NLY?s dividend payout ratio for the high 13% yield is 127%, indicating that the dividend may be unsustainable relative to earnings. Analysts expect NLY?s share count to increase by 7% annually over the next 3-years, raising concerns about potential dilution of per-share earnings if profit growth does not keep pace. NLY recorded a year-over-year decline in book value per share (BVPS), which was $19 as of September 30, 2025. In Q2 2025, NLY?s actual earnings missed analyst expectations by 95%.

DISCLAIMER: By including a shareholder resolution or management proposal in this database, neither the PRI nor the sponsor of the resolution or proposal is seeking authority to act as proxy for any shareholder; shareholders should vote their proxies in accordance with their own policies and requirements.

Any voting recommendations set forth in the descriptions of the resolutions and management proposals included in this database are made by the sponsors of those resolutions and proposals, and do not represent the views of the PRI.

Information on the shareholder resolutions, management proposals and votes in this database have been obtained from sources that are believed to be reliable, but the PRI does not represent that it is accurate, complete, or up-to-date, including information relating to resolutions and management proposals, other signatories’ vote pre-declarations (including voting rationales), or the current status of a resolution or proposal. You should consult companies’ proxy statements for complete information on all matters to be voted on at a meeting.