Alerts

Proxy Access Q&A for Public Companies

September 13, 2010

During late August, the SEC adopted Rule 14a-11 under the Exchange Act, its long anticipated proxy access rule. Under Rule 14a-11, shareholders that meet the specified criteria discussed below are now able to require public companies to include in their proxy materials director candidates that are nominated by the shareholders. Proxy access makes it significantly easier for eligible shareholders to propose director nominees, since the shareholders are not required to pay for the preparation, printing and mailing of separate proxy materials. As part of the same Adopting Release, the SEC also narrowed the exceptions under Rule 14a-8(i)(8) under the Exchange Act to facilitate shareholder proposals relating to proxy access. This Q&A answers many of the questions that public companies and their boards are likely to have about proxy access in connection with preparing for the upcoming annual meeting season.