Release No. 34-8029 

Release No. 35-15647 

Release No. IC-4823

January 24, 1967

Extension of Time for Submitting Comments on Proposed Amendments to Proxy Rules and Information Rules; Adoption of Amendments to Certain Rules.

On December 5, 1966, the Securities and Exchange Commission, in Securities Exchange Act Release No. 8000, invited public comments on certain proposed amendments to its proxy rules under Section 14(a) of that Act and its information rules under Section 14(c) thereof.  The Commission has, at the request of certain persons who desire further time to study the proposed amendments and submit comments thereon, extended the period within which comments may be submitted to March 3, 1967.  As a result of the extension of time it is contemplated that no amendments, except as noted below, will be applicable to the pending proxy season but that the existing administrative practices referred to in the above release will continue to be followed.  The postponement of definitive action on the proposed amendments will assist companies which are engaged in collecting information for inclusion in their proxy material for their current annual meeting and will give the Commission further time to consider the proposed amendments and the comments received thereon.

Amendment Adoptions

The Commission has, however, adopted the proposed amendments to Rules 14a-3 and 14c-3.  The comments on the proposed amendments to these rules were generally favorable and few of them raised basic objections to the proposed amendments.  It does not appear that the adoption of the amendments at this time will cause any difficulty.  A brief description of the amendments to these rules is set forth below.

Rule 14a-3

Paragraph (b) of Rule 14a-3 provides that if a solicitation is made on behalf of the management of the issuer and relates to an annual meeting at which directors are to be elected, the proxy statement shall be accompanied or preceded by an annual report to security holders containing financial statements for the last fiscal year.  This paragraph has been amended to require an issuer, other than an investment company, to include in such annual report financial statements for the preceding fiscal year as well.  Provision has been made, however, for the omission of statements for the earlier of such two years upon a showing of good cause therefor.  Certification of the statements for only the last fiscal year is required, but certification for both fiscal years is permitted.  Because special problems arise with respect to investment companies and because most of their reports will have been published by the effective date of the rule, it was determined not to make the change applicable to the reports of such companies at this time.

Paragraph (b) of the rule has been amended by adding thereto a note which makes it unnecessary to send a copy of the annual report to each of several record security holders having the same address if such security holders consent to the sending of a lesser number of copies.  However, where a record security holder has an obligation to obtain or send the annual report to other persons, such as the beneficial owners of the securities held in his name, the new provision does not relieve the record holder of such obligation.

Paragraph (c) of Rule 14a-3 heretofore required four copies of each annual report sent to security holders to be furnished to the Commission for its information.  This paragraph has been amended to require that seven copies of the annual report be furnished in order that the Commission may send copies to certain regional offices of the Commission, including the regional office for the region in which the issuer has its principal office.

In order to maintain consistency between the proxy rules and the rules relating to information statements, Rule 14c-3 has been amended to conform to the amended Rule 14a-3.

Rules 14a-6 and 14c-5 have been amended to require the filing with the Commission of five copies of all preliminary material, in lieu of the three copies now required.  The additional copies of such material are needed to expedite examination of the material and for recording in connection with the Commission's data processing program.

[Text of rule omitted]

The foregoing action has been taken pursuant to the Securities Exchange Act of 1934, particularly Sections 14(a), 14(c) and 23(a) thereof.  Amended Rules 14a-3 and 14c-3 shall be effective with respect to annual reports sent to security holders on or after March 1, 1967 and amended Rules 14a-6 and 14c-5 shall be effective with respect to preliminary material filed with the Commission on or after that date.

By the Commission.