Eli Lilly 2008 Annual Report Download - page 71

PROXY STATEMENT
6969
General Information
Why did I receive this proxy statement?
The board of directors of Eli Lilly and Company is soliciting proxies to be voted at the annual meeting of share-
holders (the annual meeting) to be held on Monday, April 20, 2009, and at any adjournment of the annual meeting.
When the company asks for your proxy, we must provide you with a proxy statement that contains certain informa-
tion specifi ed by law.
What will the shareholders vote on at the annual meeting?
Seven items:
• election of directors
• ratifi cation of the appointment of principal independent auditor
• amending the company’s articles of incorporation to provide for annual election of all directors
• reapproving performance goals for the company’s cash bonus plan
• a shareholder proposal on eliminating supermajority voting provisions from the company’s articles of
incorporation and bylaws
• a shareholder proposal on allowing shareholders to amend the company’s bylaws
• a shareholder proposal on shareholder ratifi cation of executive compensation.
Will there be any other items of business on the agenda?
We do not expect any other items of business because the deadline for shareholder proposals and nominations
has already passed. Nonetheless, in case there is an unforeseen need, the accompanying proxy gives discretion-
ary authority to the persons named on the proxy with respect to any other matters that might be brought before the
meeting. Those persons intend to vote that proxy in accordance with their best judgment.
Who is entitled to vote?
Shareholders as of the close of business on February 13, 2009 (the record date) may vote at the annual meeting.
You have one vote for each share of common stock you held on the record date, including shares:
• held directly in your name as the shareholder of record
• held for you in an account with a broker, bank, or other nominee
• attributed to your account in the Lilly Employee 401(k) Plan (the 401(k) plan).
What constitutes a quorum?
A majority of the outstanding shares, present or represented by proxy, constitutes a quorum for the annual meet-
ing. As of the record date, 1,149,015,882 shares of company common stock were issued and outstanding.
How many votes are required for the approval of each item?
There are differing vote requirements for the various proposals.
• The four nominees for director will be elected if they receive a majority of the votes cast. Abstentions will not
count as votes cast either for or against a nominee.
• The following items of business will be approved if the votes cast for the proposal exceed those cast against the
proposal:
—the appointment of principal independent auditor
—the management proposal to reapprove performance goals for the company’s bonus plan
—the shareholder proposals.
Abstentions will not be counted either for or against these proposals.
• The management proposal to amend the articles of incorporation to provide for annual election of all directors
requires the vote of 80 percent of the outstanding shares. For this item, abstentions and broker nonvotes have
the same effect as a vote against the proposal.
Broker nonvotes.
If your shares are held by a broker, the broker will ask you how you want your shares to be voted.
If you give the broker instructions, your shares will be voted as you direct. If you do not give instructions, one of two
things can happen, depending on the type of proposal. For the election of directors, the ratifi cation of the auditor, and
the management proposals on reapproving performance goals for the company’s bonus plan and amending the arti-
cles of incorporation to provide for annual election of all directors, the broker may vote your shares in its discretion.
For all other proposals, the broker may not vote your shares at all. When that happens, it is called a “broker nonvote.”