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SEC Provides Guidance on Delays in Printing and Mailing of Full Sets of Proxy Materials

On April 7, the Securities and Exchange Commission (SEC) provided guidance to issuers that may be experiencing unexpected delays with the printing and physical mailing of a “full set” of their proxy materials for their upcoming shareholder meetings. A “full set” of proxy materials contains (1) a proxy statement or information statement, (2) an annual report if one is required by Exchange Act Rule 14a-3(b) or 14c-3(a), and (3) a proxy card or, in the case of a beneficial owner holding in “street name” a request for voting instructions, if proxies are solicited.

The SEC recognized that some issuers would like to provide the full set of their proxy materials through the “notice-only” delivery option permitted by Exchange Act Rule 14a-16 but are concerned they may not be able to comply with its requirements. Specifically, as a result of the COVID-19 pandemic’s impact on facilities and staffing of proxy service providers and transfer agents, issuers are concerned they may not be able to (1) send the notice of the electronic availability of the proxy materials at least 40 calendar days before the shareholder meeting, (2) provide intermediaries (such as a broker, dealer or bank) with the information needed to send the notice to beneficial owners within the 40 calendar days timeframe required by Exchange Act Rule 14b-1 or 14b-2, or (3) respond to a shareholder’s request for paper copies of proxy materials in a timely manner.

As a result of the foregoing, the SEC has determined that, in instances where delays are unavoidable due to circumstances related to the COVID-19 pandemic, it would not object to an issuer using the “notice-only” delivery option, even if such issuer does not meet all timing requirements of Exchange Act Rule 14a-16, as long as the issuer will provide shareholders with the proxy materials sufficiently in advance of the shareholder meeting.  Additionally, the SEC encouraged issuers and intermediaries to continue using their best efforts to send requesting shareholders their paper copies of proxy materials and annual reports, even if such deliveries would be delayed.

A copy of the SEC’s announcement providing updated guidance is available here.

©2020 Katten Muchin Rosenman LLPNational Law Review, Volume X, Number 101


About this Author

Edward Matzner Corporate Attorney Katten Muchin Rosenman New York, NY

Edward Matzner offers insight on a broad range of matters related to private equity, mergers and acquisitions, and related securities regulations. He combines efficiency with attention to detail to provide deal-making support.

Practice Focus

  • Corporate
  • Corporate securities
  • Private equity
  • Mergers and acquisitions
  • Regulator and compliance

Irina Nica is an associate in the Corporate practice.

Mark D. Wood, corporate securities lawyer Katten Muchin Chicago Law firm

Mark D. Wood is head of Katten's Securities practice and concentrates in corporate and securities law. Mark represents public companies, issuers and investment banks in initial public offerings (IPOs) and other public offerings, private investment in public equity (PIPE) transactions, debt securities and other securities matters.

Mark also represents clients in complex corporate transactions, including tender offers, mergers, acquisitions, dispositions, going-private transactions, private equity investments, joint ventures and...