Proxy Materials & the Internet

Effective July 1, 2007, SEC Rules will allow companies to furnish proxy materials to shareholders through a “notice and access” model. Under this elective model, a company must post its proxy materials on an Internet Web site and send a Notice of Internet Availability of Proxy Materials to shareholders at least 40 days before the meeting date.  This amendment to the Proxy Rules was adopted by the SEC at its Dec. 13, 2006 meeting.  Of course, this process should result in a significant cost saving in producing proxy materials -- both for companies and for shareholders that want to conduct proxy solicitations.  Shareholders that want paper copies can still request and receive them.

At the same time, the SEC adopted a Proposal to make this "notice and access" model mandatory for all solicitations not related to a business combination transaction.  The SEC seeks public comment on this Proposal for 60 days after Federal Register Publication.

Link to SEC Release 2006-209:  http://www.sec.gov/news/press/2006/2006-209.htm

(ag) in Securities Law/Corporate Governance