SEC Adopts E-Proxy Rules

At its meeting on Wednesday, December 13, the Securities and Exchange Commission adopted amendments to its proxy rules that would permit, but not require, a public company to furnish proxy materials to shareholders using the Internet beginning July 1, 2007. The e-proxy rules are intended to decrease substantially the cost of proxy solicitations and make it more cost-effective for persons other than the company to undertake their own solicitations.

How the Rules Work.

Under the new rules (which are not yet available in final form), a company wishing to do an e-proxy solicitation must post proxy materials on a web site and send notice to shareholders at least 40 days before the meeting date. This initial notice, which may not include a proxy card, must be in plain English and must advise shareholders of the date, time and place of the meeting, the availability of e-proxy materials, the matters to be considered at the meeting and a toll-free number, e-mail address and website that