SEC Adopts New Rules to Facilitate Rights of Shareholders to Nominate Directors
Companies are now required to grant proxy access to director nominees submitted by shareholders pursuant to new rules adopted by the Securities and Exchange Commission (the "SEC") on August 25, 2010. The series of amendments to the federal proxy access rules, passed by a 3-2 vote, is designed to facilitate shareholders' rights to nominate directors by requiring a company to include shareholder nominees in the company's proxy materials. The new rules defer to applicable state law and a company's governing documents regarding whether shareholders have the right to nominate directors. If shareholders have the right to nominate directors under state law or a company's governing documents, then state law or a company's governing documents cannot regulate or prevent access to the company's proxy statement for such nominees.
This alert provides a summary of the key changes, background information and specifics on the proxy rules. To read the alert click on the PDF linked below.
If you have any questions about this topic, please contact a member of our Securities/Capital Markets practice group.