In light of the approaching 2015 annual stockholder meeting season, below is an overview of the essential facts on proxy supplements and proxy amendments or revisions. Determining whether and how to amend proxy material requires careful analysis under time pressure. In addition to consulting these guidelines, companies facing these issues are encouraged to work with outside counsel to ensure disclosures remain correct and complete throughout the proxy solicitation process.
For more a more in-depth discussion, read the full Client Alert, Pumping Up for Proxy Season: Know Your Supplements.
Proxy Supplements
Who: Companies approaching the annual stockholder meeting season.
Why: To add new information or correct immaterial errors.
What: The contents of a supplemental filing vary widely depending on the nature of the information presented and can include: a letter to stockholders, press release, presentation, explanatory note or an employee communication.
Where: Required to be filed on EDGAR and posted to e-proxy website.
How: A company files supplemental proxy material with the SEC by checking the “Definitive Additional Material” box on the cover page of Schedule 14A. On EDGAR, the filing appears as a “DEFA14A” entry.
When: Rarely (if ever) will a proxy supplement trigger a new 10-day waiting period for preliminary proxy materials before the company can file its definitive proxy statement. The scheduled meeting date is usually retained, but if a company adds a new proposal, the company can adjourn the scheduled meeting in full or only as to the new proposal.
Proxy Amendments/Revisions
Who: Companies approaching the annual stockholder meeting season.
Why: To correct material errors.
What: The amended or revised proxy statement can be in the form of a page that explains the error and provides the corrected information, or it can be a restatement of the entire proxy containing the corrected information and an explanatory note regarding the error and corrections made. Companies may choose to amend and restate the original proxy statement or surgically address the revisions. As with proxy supplements, reiterating how stockholders may cast, or revoke and re-cast, their vote on the matters discussed in the proxy statement is advisable.
Where: Required to be filed on EDGAR and posted to e-proxy website.
How: A company files an amendment (often involving surgical changes to the original proxy statement) or a completely revised proxy statement with the SEC by labeling the filing as an amendment or revised proxy statement and checking the “Definitive Additional Material” box on the cover page of Schedule 14A. On EDGAR, the filing appears as a “DEFR14A” entry. In addition, Rule 14a-6(h) requires that two copies of the materials manually filed with the SEC be marked to indicate “clearly and precisely” the changes made, and if the amendment or revision alters the text of the material, the company needs to indicate the changes by means of underlining or some other demarcation.
When: If amending a preliminary proxy statement, companies may need to re-start 10-day waiting period if changes are significant and impact a proposal that triggered the preliminary proxy. Companies may need to adjourn or postpone the meeting to allow time for consideration of the revised proposal — depending on the time between the proxy amendment’s filing and the scheduled meeting, as well as the ability of the company to conduct outreach to key constituents.
