Client Alert

SEC Amends E-Proxy Rules

February 25, 2010

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Earlier this week, the SEC amended its “notice and access” (or “e-proxy”) rules for furnishing proxy materials to shareholders via the Internet. The amended rules essentially track the SEC’s October 2009 proposals to (i) expand the flexibility of the format of the notice of Internet availability of proxy materials; (ii) allow issuers and other soliciting persons to include explanatory materials about the reasons for the use of the notice and access rules and the process of receiving and reviewing proxy materials and voting; and (iii) revise the timetable for non-issuer soliciting persons relying on the notice and access method. The new rules will be effective March 29, 2010.
 
The SEC’s e-proxy amendments and other related SEC actions are intended to encourage greater investor participation in corporate elections in light of recent data indicating that (particularly individual) shareholder participation rates have dropped, especially for companies using the notice-only option. Individual voting participation is especially important this year, due to the SEC’s 2009 elimination of discretionary broker voting for uncontested director elections.

Click here to read our client alert regarding the SEC's recent e-proxy rule changes.

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