To: Public File
From: Brian A. Stern
Counsel to Commissioner Glassman
Date: December 22, 2003
Re: File No. S7-19-03

On October 24, 2003, Commissioner Glassman and Brian Stern met with Sarah Teslik of the Council of Institutional Investors (CII) regarding the above-referenced matter. She noted that CII had not finalized its position, so the views she expressed did not necessarily represent CII's views.

Ms. Teslik expressed the view that there should be as few barriers as possible between owners and their property. She said that it would not be productive if "non-market" agendas dominate the nomination process; however, she did not think there was a real risk of that, especially given the triggers built into the rule. She said that we should not distrust shareholders, who should have the right to act effectively as owners.

Ms. Teslik noted that the proposal's requirement that nominating shareholders file an Exchange Act Schedule 13G would be a significant disincentive for many shareholders, and it would discourage them from using the proposed rule. She said that the "withheld vote" trigger would likely be the only one used to trigger the shareholder nomination process.

She indicated that CII intends to provide detailed comments through the comment letter process.