I missed it on Friday (July 25), but Cheniere Energy made it official, filing a Notice of Postponed Annual Meeting of Stockholders and 2014 Proxy Statement. On June 4, we blogged on “Company Postpones its Annual Meeting Due to Lawsuit over Stock Plan and Disclosures." Readers will recall that, in early June, Cheniere announced that it had postponed its 2014 annual meeting of shareholders, which had been scheduled to be held on June 12, 2014, to September 11, 2014, due to a lawsuit filed four days earlier against Cheniere’s officers and directors. The lawsuit (Jones v. Souki, et al., Delaware Court of Chancery) alleges deficiencies in the shareholder approval process for the Cheniere 2011 Stock Plan and the proxy statement disclosures concerning the 2011 Plan. [The next edition of The Corporate Executive will feature an extensive discussion of this case.]

The new proxy statement for the 2014 meeting does not include a proposal additional shares for the 2011 Plan share reserve, explaining:

“Proposals relating to the 2014-2018 LTIP and the 2011 Plan were included in the previously sent proxy materials. The Board in consultation with the Compensation Committee has subsequently withdrawn these proposals. After receiving feedback from stockholders and consulting with management, the Board determined that this is not the appropriate time to ask the stockholders to approve a new pool of shares. The Company will reassess its strategy in this context given the need to attract, retain and motivate employees with the talent and experience to effectively execute the Company’s strategic business plan.”

Whether or not the courts ultimately find any merit in the plaintiffs’ claims, this is an extremely negative development in the recent surge of litigation against officers and directors over stock plans and disclosures. It is the first time (of which I am aware) the plaintiffs’ lawyers have succeeded in forcing a company to postpone its annual shareholders meeting.

I certainly take no joy in reporting this misfortune of others. If the allegations are true, it's every lawyer's worst nightmare. The only way for some good to come of it is for all of us to double check our bylaw provisions on shareholder voting.