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How the SEC’s universal proxy proposal affects Canadian companies and investors

  • SEC (US Securities and Exchange Commission) Image

Nov 30, 2016

On November 2016, the U.S. Securities and Exchange Commission (SEC) proposed amendments to its proxy rules that are designed to allow shareholders using the proxy system to vote for their choice of a combination of candidates in a contested election for directors, rather than being limited only to the candidates on either a management proxy or dissident proxy.

The proposed changes could make it easier and less costly for dissident candidates to be elected to corporate boards, which could have ripple effects on corporate governance practices and negotiating strategies for activists. Use of a universal proxy would require the dissident to provide advance notice of its nominees and incur the cost of preparing dissident proxy materials and sending those proxy materials to potentially more shareholders than it would otherwise solicit.

Review the update on Osler's website.

Correction list for hyphenation

These words serve as exceptions. Once entered, they are only hyphenated at the specified hyphenation points. Each word should be on a separate line.