2008 changes

• Amends Rule 14a-8(1)(8) to overturn effect of
  AFSCME v AIG
• Changes effective 1.10.08

• Release 34-56914   See below

2006 AFSCME v AIG decision

• Second Circuit rules that proxy access by-laws can't be excluded under Rule 14a-8(1)(8)
• See AFSCME v AIG
• See Rule 14a-8(1)(8)

1998 rule changes

• Recast Rule 14a-8 into a Plain English Q&A format

• Release 34-40018  See below

Cracker Barrel  1992-1998

• SEC changed its policy in 1992 on what was a socially significant matter and refused to require the inclusion of a proposal relating to alleged discriminatory employment practices
• SEC prevailed in ensuing litigation but then reversed itself in 1998 rule-making
• See Cracker Barrel
• See Release 34-40018 below

1987 rule changes

• Deleted the limitation on inclusion of a shareholder proposal where the proponent delivers written proxy materials to holders of more than 25% of a class of the registrants securities
• Changes the rules for documentary support of a proponents beneficial ownership

• Release 34-25217   See below

1983 rule changes

• SEC adopts broad-sweeping changes to shareholder access rule

• Release 34-20091   See below

1978 rule changes

• Allowed proponents to review the accuracy of management statements in opposition
• Release 34-15384   See below

1976 rule changes

• Expanded the rule and added more detail including to clarify the requirements applicable to both proponents of shareholder proposals and managements
• Release 34-12999   See below

1972 rule changes

• Made changes to several provisions to Rule 14a-8
• Release 34-9784   See below

1970 Medical Committee decision

• Medical Committee For Human Rights v SEC
  432 F 2d 659 (DC Cir 1970)
• SEC had allowed exclusion of a proposal that Dow Chemical should ban the production of napalm
• Court criticized the SEC and ordered further factual inquiry into the SEC's decision-making

1967 rule changes

• Adopted a fixed deadline for shareholder submission of proposals
• Allowed a company to not identify proponent in its proxy materials
• Release 34-8206   See below

1954 rule changes

• Added several provisions to Rule 14a-8, most of which have carried down to the current version of the rule
• Release 34-4979   See below

1952 rule changes

• Allowed companies to exclude "social" proposals
• Release 34-4775 12.11.52

1951 Greyhound decision

• Peck v Greyhound  97 F Supp 679 (SDNY 1951)
• Upheld SEC's allowing exclusion of a proposal to end segregated seating on Greyhound buses

1948 rule changes

• Added personal grievance exclusion
• Added the attendance exclusion
• Added the resubmission exclusion
• Release 34-4185 11.0548

1947 rule changes

• Required companies to submit their reasons for excluding a proposal to the SEC for its review
• Release 34-4037  12.17.47

1947 Transamerica decision

• SEC v Transamerica 163 F.2d 511 (3d Cir 1947)
• SEC v Transamerica  67 F Supp 326 (D. Del 1946)
• Company refused to include a shareholder proposal
• Third Circuit upheld SEC's authority

1945 interpretive release

• Addressed what were proper subjects under state law
• Release 34-3638  1.03.45

1942 adoption

• SEC adopts Rule X-14A-7
• Rule requires companies to include shareholder proposals of not more than 100 words provided proponents gave reasonable notice and proposal was proper subject for shareholder action under state law
• Release 34-3347  12.18.42

From GPO website

• April 2007
• April 2006
• April 2005
• April 2004
• April 2003
• April 2002
• April 2001
• April 2000 
• April 1999 
• April 1998  

Shareholder Proposals Relating to the Election of Directors

• Fed Reg PDF  72 Fed. Reg. 70449   12.11.07
• SEC PDF  Dec 6, 2007
• SEC amended Rule 14a-8(i)(8) in response to AFSCME v AIG

Hyperlinked index to release:

Top of release  ++

Background  I.

• Purpose of the Rule 14a-8(i)(8) exclusion  I.A
• Background relating to rule amendment  I.B

SEC interpretation  II.

Amendment to Rule 14a-8(i)(8)  III.

Miscellaneous sections of Release

• Paperwork Reduction Act  IV.
• Cost-benefit analysis  V.
• Burden on competition, etc.  VI.
• Regulatory flexibility analysis  VII.

Text of Amendments  IX.

Shareholder Proposals Relating to the Election of Directors

• Fed Reg PDF  72 Fed. Reg. 43488   8.03.07
• SEC PDF  7.27.07
• SEC proposed to amend Rule 14a-8(i)(8) in response to AFSCME v AIG
• SEC published two competing proposals

• Proposal Release 34-56160  below
• Proposal Release 34-56161  this box

Hyperlinked index to release:

Top of release  ++

Overview  I.

• Federal Regulation of Proxy Process  I.A
• Exchange Act Disclosure Requirements  I.B
• The Shareholder Proposal Process  I.C

The Election Exclusion in Rule 148-6(i)(8)  II.

• Introduction  II.A
• The Purpose of the Election Exclusion  II.B
• Application of the Election Exclusion Since 1976  II.C

Proposed Amendments to Rule 14a-8(1)(8)  III.

General Request for Comment  IV.

Miscellaneous sections of Release

• Paperwork Reduction Act  V.
• Cost-benefit analysis  VI.
• Burden on competition, etc.  VII.
• Initial regulatory flexibility analysis  VIII.
• Small Business Enforcement Fairness  IX.

Text of Proposed Amendments  X.

Shareholder Proposals Relating to the Election of Directors

• Fed Reg PDF  72 Fed. Reg. 43466   8.03.07
• SEC PDF  7.27.07
• SEC proposed to amend Rule 14a-8(i)(8) in response to AFSCME v AIG
• SEC published two competing proposals

• Proposal Release 34-56160  this box
• Proposal Release 34-56161  above

Hyperlinked index to release:

Top of release  ++

Overview  I.

• Federal Regulation of Proxy Process  I.A
• The Shareholder Proposal Process  I.B
• Commission Review of Proxy Process  I.C

Proposed Amendments  II.

• Bylaw Proposals for Shareholder Nominations  II.A
• Electronic Shareholder Forums   II.B
• Request for Comments on Proposals Generally  II.C

Request for Comment on Proposals Generally  III.

Miscellaneous sections of Release

• Paperwork Reduction Act  IV.
• Cost-benefit analysis  V.
• Burden on competition, etc.  VI.
• Regulatory flexibility analysis  VII.
• Small Business Enforcement Fairness  VIII.

Text of Proposed Amendments  IX.

Amendments to Rules on Shareholder Proposals

• Fed Reg PDF  63 Fed. Reg. 29106   5.28.98
• SEC website version
• Changes made:

• Recast Rule 14a-8 into a Question & Answer format
• Reversed the Cracker Barrel no-action letter on employment-related proposals raising social policy issues
• Adopt other less significant amendments to rule 14a-8
• Amend rule 14a-4 to provide shareholders and companies with clearer guidance on companies exercise of discretionary voting authority

Hyperlinked index to release:

Top of release   ++

Executive summary   I.

Question & answer format  II.

Rule 14a-8(c)(7): Ordinary business exclusion  III.

Rule 14a-4: Discretionary voting authority  IV.

• Rule 14a-4(c)(1)  IV.A
• Rule 14a-4(c)(2)  IV.B

• Proxy statement disclosure  IV.B.1
• No separate voting box  IV.B.2
• Percentage of shareholders to be solicited  IV.B.3

• Rule 14a-4(c)(3)  IV.C
• Filing in preliminary form  IV.D

Other amendments  V.

Proposals not adopted   VI.

• Personal grievance exclusion
• Resubmission thresholds
• Proposed override mechanism
• Relevance exclusion
• Statements in opposition: Commission review

Miscellaneous sections of Release

• Regulatory Flexibility Analysis  VII.
• Cost-Benefit Analysis  VIII.
• Paperwork Reduction Act  IX.

Text of Amendments  X.

Amendments to Rules on Shareholder Proposals

• Fed Reg PDF  62 Fed. Reg. 50682   9.26.97
• SEC website version
• Comment letters

• Proposes changes to:

• Recast Rule 14a-8 into a Question & Answer format
• Reverse the Cracker Barrel no-action letter on employment-related proposals raising social policy issues
• Adopt other amendments to Rule 14a-8
• Amend Rule 14a-4 to provide shareholders and companies with clearer guidance on companies exercise of discretionary voting authority

Hyperlinked index to release:

Top of release  ++

Executive summary  I.

Background  II.

Proposed amendments  III.

• Plain-English, Q&A format  III.A
• Rule 14a-8(c)(4): Personal claim or grievance  III.B
• Rule 14a-8(c)(5): Relevance exclusion  III.C
• Rule 14a-8(c)(7): Ordinary business exclusion  III.D
  Includes "Cracker Barrel" reversal
• Rule 14a-8(c)(12): Resubmission thresholds  III.E
• Proposed override mechanism  III.F
• Safe harbor under Section 13(d)  III.G
• Rule 14a-4: Discretionary voting authority  III.H
• Other proposed modifications  III.I

• Question 1 of revised Rule 14a-8  III.I.1
• Rule 14a-8(a)(1)  III.I.2
• Question 6 in revised Rule 14a-8  III.I.3
• Rule 14a-5(e)  III.I.4
• Rule 14a-8(e)  III.I.5
• Rule 14a-8(a)(2)  III.I.6

Miscellaneous Sections

• Request for comment  IV.
• Regulatory Flexibility Act analysis  V.
• Cost-Benefit analysis  VI.
• Paperwork Reduction Act  VII.
• Small Business Regulatory Enforcement Fairness Act  VIII.

Text of Proposed Amendments  IX.

Proxy Rules -- Amendments To Eliminate Filing Requirements For Certain Preliminary Proxy Material; Amendments With Regard To Rule 14a-8, Shareholder Proposals

• Adopts an amendment to Rule 14a-8 to delete the limitation on inclusion of a shareholder proposal in the registrants proxy material where the proponent delivers written proxy materials to holders of more than 25% of a class of the registrants securities
• Other amendments to Rule 14a-8 relating to requests for documentary support of a proponents beneficial ownership claim require that a registrant make any request for documentary support within 14 calendar days, extend from 14 to 21 calendar days the time period in which such documentation must be furnished, and require that a registrant accept, under certain circumstances, a copy of certain SEC filings, together with a proponents affidavit, as sufficient documentation of a proponents beneficial ownership claim
• Also adopts other changes to proxy rules

Hyperlinked index to release:

Top of release  ++

Executive summary  I.

• Exclusion from filing preliminary proxy material  I.A
• Amendments to the Shareholder Proposal Rule  I.B

Proposed amendments  II.

Exclusion from filing preliminary proxy material  II.A

• Scope  II.A.1

• Treatment of investment companies  II.A.1.a
• Proposal relating to solicitations in opposition  II.A.1.b

• Related amendments to Rule 14a-8  II.A.2
• Filing fees  II.A.3

Amendments to Rule 14a-8  II.B

• Rule 14a-8(a)(1)(ii): Delete 25% limitation  II.B.1
• Documentary support of beneficial ownership  II.B.2

Amendments to Rule 14a-8  II.C

Miscellaneous Sections

• Cost-Benefit Analysis  III.
• Regulatory Flexibility Act analysis  IV.
• Statutory Basis  V.

Text of Amendments  VI.

Amendments to Rule 14a-8 Under the Securities Exchange Act of 1934 Relating to Proposals by Security Holders

• SEC adopts broad-sweeping changes to shareholder access rule

Hyperlinked index to release:

Top of release   ++

Executive summary   I.

Discussion of specific provisions   II.

• Procedural requirements for proponents  II.A

• Eligibility  II.A.1
• Notice  II.A.2
• Timeliness  II.A.3

• Number of proposals  II.B
• Supporting statements for proposal  II.C
• Identification of proponent  II.D
• Substantive grounds for omission  II.E

• Not a proper subject under state law  II.E.1
• Contrary to the proxy rules  II.E.2
• Personal claim or grievance  II.E.3
• Not significantly related to the issuers business  II.E.4
• Ordinary business  II.E.5
• Moot  II.E.6
• Repeat proposals  II.E.7

• Procedural requirements for issuers  II.F
• No-action procedures  II.G   

Statutory Authority  IV

Text of Amendments  V

Proposed Amendments to Rule 14a-8 Under the Securities Exchange Act of 1934 Relating to Proposals by Security Holders

• SEC proposed broad-sweeping alternative proposals to make change to shareholder access rule
• Proposal I would retain the framework of the current rule with certain revisions
• Under Proposal II, issuers would be permitted to their own eligibility criteria subject to shareholder approval
• Proposal III would provide relatively unfettered access to the issuers proxy statement

Hyperlinked index to release:

Top of release   ++

Executive summary  ++

Background  I.

Alternatives to current Rule 14a-8   II.

• Proposal I
• Proposal II
• Proposal III

Impact on competition  III.

Regulatory Flexibility Act  IV.

Hyperlinked index to release appendix:

Statistics  I.

Proposal I  II.

• Procedural requirements for proponents  II.A

• Eligibility  II.A.1
• Notice  II.A.2
• Timeliness  II.A.3
• Number and length of proposals  II.A.4
• Supporting statements for proposal  II.A.5

• Substantive grounds for omission  II.B

• Contrary to the proxy rules  II.B.1
• Personal claim or grievance  II.B.2
• Not significantly related to the issuers business  II.B.3
• Ordinary business operations  II.B.4
• Mootness  II.B.5
• Resubmission of proposals  II.B.6
• No-action procedures  II.B.7

• Procedural requirements for issuers  II.C

Proposal II   III.

Proposal III   IV.

Shareholder Communications, Shareholder Participation in the Electoral Process and Corporate Governance Generally

• SEC adopted rules to afford shareholder-proponents an opportunity to review the accuracy of management statements in opposition to shareholder proposals prior to the mailing of issuers proxy soliciting materials

• Addressed in Section VI of the release

• Release also addressed other changes to the proxy rules
• Top of release
• Background
• Relevant sections

• Section VI
  Shareholder-proponent consideration of managements statement in opposition-Rule 14a-8(e)

• New Rule 14a-8(e) added

• Text of rule

Adoption of Amendments Relating to Proposals by Security Holders

• Including to clarify the requirements applicable to both proponents of shareholder proposals and managements

Hyperlinked index to release:

Top of release   ++

• Proponent procedural requirements - 14a-8(a)

• Eligibility - 14a-8(a)(1)
• Notice - 14a-8(a)(2)
• Timeliness - 14a-8(a)(3)
• Number and length of proposals - 14a-8(a)(4)

• Supporting statements - 14a-8(b)
• Substantive bases for omitting proposals - 14a-8(c)

• State law - 14a-8(c)(1)
• Other applicable federal and state laws - 14a-8(c)(2)
• Proxy rules and regulations - 14a-8(c)(3)
• Personal claim or grievance - 14a-8(c)(4)
• Insignificant matters - 14a-8(c)(5)
• Matters beyond issuers power - 14a-8(c)(6)
• Routine matters - 14a-8(c)(7)
• Proposed alternate to (c)(5) and (c)(7)
• Elections to office - 14a-8(c)(8)
• Counter proposals - 14a-8(c)(9)
• Moot proposals - 14a-8(c)(10)
• Similar proposals in current year - 14a-8(c)(11)
• Similar proposals in prior years - 14a-8(c)(12)
• Specific dividend amounts - 14a-8(c)(13)

• Management procedural requirements - 14a-8(d)
• Cost data
• Date of effectiveness
• Authority

Revised rule text  ++

• Rule 14a-8(a)

• Eligibility - 14a-8(a)(1)
• Notice - 14a-8(a)(2)
• Timeliness - 14a-8(a)(3)
• Number and length of proposals - 14a-8(a)(4)

• Rule 14a-8(b)
• Rule 14a-8(c)

• State law - 14a-8(c)(1)
• Other applicable federal and state laws - 14a-8(c)(2)
• Proxy rules and regulations - 14a-8(c)(3)
• Personal claim or grievance - 14a-8(c)(4)
• Insignificant matters - 14a-8(c)(5)
• Matters beyond issuers power - 14a-8(c)(6)
• Routine matters - 14a-8(c)(7)
• Elections to office - 14a-8(c)(8)
• Counter proposals - 14a-8(c)(9)
• Moot proposals - 14a-8(c)(10)
• Similar proposals in current year - 14a-8(c)(11)
• Similar proposals in prior years - 14a-8(c)(12)
• Specific dividend amounts - 14a-8(c)(13)

Proposed Amendments to Rule 14a-8 Relating to Proposals by Security Holders

• Including to clarify the requirements applicable to both proponents of shareholder proposals and managements

Hyperlinked index to release:

Top of release   ++

• Proponent procedural requirements - 14a-8(a)

• Eligibility - 14a-8(a)(1)
• Notice - 14a-8(a)(2)
• Timeliness - 14a-8(a)(3)
• Number and length of proposals - 14a-8(a)(4)

• Supporting statements - 14a-8(b)
• Substantive bases for omitting proposals - 14a-8(c)

• State law - 14a-8(c)(1)
• Federal law - 14a-8(c)(2)
• Proxy rules and regulations - 14a-8(c)(3)
• Personal claim or grievance - 14a-8(c)(4)
• Insignificant matters - 14a-8(c)(5)
• Matters beyond issuers power - 14a-8(c)(6)
• Routine matters - 14a-8(c)(7)
• Proposed alternate to (c)(5) and (c)(7)
• Elections to office - 14a-8(c)(8)
• Counter proposals - 14a-8(c)(9)
• Moot proposals - 14a-8(c)(10)
• Similar proposals in current year - 14a-8(c)(11)
• Similar proposals in prior years - 14a-8(c)(12)
• Specific dividend amounts - 14a-8(c)(13)

• Management procedural requirements - 14a-8(d)

Proposed revised rule text  ++

• Rule 14a-8(a)

• Eligibility - 14a-8(a)(1)
• Notice - 14a-8(a)(2)
• Timeliness - 14a-8(a)(3)
• Number and length of proposals - 14a-8(a)(4)

• Rule 14a-8(b)
• Rule 14a-8(c)

• State law - 14a-8(c)(1)
• Other applicable federal and state laws - 14a-8(c)(2)
• Proxy rules and regulations - 14a-8(c)(3)
• Personal claim or grievance - 14a-8(c)(4)
• Insignificant matters - 14a-8(c)(5)
• Matters beyond issuers power - 14a-8(c)(6)
• Routine matters - 14a-8(c)(7)
• Elections to office - 14a-8(c)(8)
• Counter proposals - 14a-8(c)(9)
• Moot proposals - 14a-8(c)(10)
• Similar proposals in current year - 14a-8(c)(11)
• Similar proposals in prior years - 14a-8(c)(12)
• Specific dividend amounts - 14a-8(c)(13)
• Proposed alternate to (c)(5) and (c)(7)

Text of existing rule ++

• Rule 14a-8(a)
• Rule 14a-8(b)
• Rule 14a-8(c)
• Rule 14a-8(d)

Statement of Informal Procedures for the Rendering of Staff Advice with respect to Shareholder Proposals

• Describes the purposes of Rule 14a-8 and the SEC's informal advisory assistance

Top of release   ++

Final Release 34-9784  1972

• Adoption of Amendments to Rules 14a-5 and 14a-8 under the Exchange Act

• Made changes to several provisions to Rule 14a-8

• Top of release
• Relevant sections:

• Proponent statement in support
• Length of proposal
• Meeting attendance
• Absence of power / authority
• Personal grievance
• Company objection deadline
• Proponent submission deadline
• Note re certified mail

Proposal Release 34-9432  1971

• Notice Of Proposed Amendments To Rules 14a-5 and 14a-8

• Proposed changes to several provisions to Rule 14a-8

• Top of release
• Relevant sections:

• Proponent statement in support
• Length of proposal
• Meeting attendance
• Personal grievance
• Absence of power / authority
• Company objection deadline

• Text of proposed changes

Final Release 34-8206  1967

• Adoption of Amendments to Proxy and Information Rules

• Adopted a fixed deadline for shareholder submission of proposals
• Change allowed a company to not identify proponent in proxy materials

• Top of release

• Relevant sections:
  Rule 14a-8

• Proponent submission deadline
• Identification of proponent

Proposal Release 34-8000  1966

• Notice of Proposed Amendments to Proxy Rules and Information Rules

• Proposed a fixed deadline for shareholder submission of proposals
• Proposed to allow company to not identify proponent in proxy materials

• Top of release
• Relevant sections:
  Rule 14a-8

• Proponent submission deadline
• Identification of proponent

Final Release 34-4979  1954

• Adoption of Amendments to Proxy Rules

• Added several provisions to Rule 14a-8, most of which have carried down to the current version of the rule

• Top of release
• Relevant sections:
  Rule 14a-8

• Proponent submission deadline
• Identification of proponent
• Improper under state law
• Ordinary business operations
• Burden of persuasion
• Supporting opinion of counsel
• Company objection deadline
• Resubmissions

Final Release 34-55146  1.22.07

• Internet Availability of Proxy Materials
• Made conforming text changes to Rule 14a-8
• 72 FR 4148, 4168, 1.29.07

Shareholder Access - Rule 14(a)(8)