Tag Archives | AES

Exempt Solicitation Use Surges

Exempt solicitation use by shareholder proponents will continue to surge. Almost six years ago, SharkRepellent.net documented the rising use of PX14A6G filings. (Proponents Increasingly Proactive Promoting Their Issues by John Laide)

Read any good PX14A6G filings lately? During the 2012 proxy season, sponsors of shareholder proposals have been increasingly making use of rules allowing them to further press their case to stockholders to support their issues. Pursuant to Rule 14a-2(b)(1) of the Exchange Act, a shareholder can freely communicate its views to stockholders without having to comply with the proxy filing and disclosure rules associated with a contested solicitation if it is not seeking proxy voting authority (i.e. the shareholder is not seeking the power to act as proxy for a stockholder and does not provide its own proxy card in its materials).  The filing itself generally takes the form of a letter to fellow shareholders attempting to persuade them to vote for a proposal the shareholder is sponsoring, to vote against a management proposal, or to withhold votes for directors, and will appear on the SEC’s EDGAR filing system alongside the company’s other filings. An exempt solicitation provides an easy, cost-effective way for proponents to express their views and lobby fellow shareholders beyond the 500-word limit imposed by Rule 14a-8 for a proposal and supporting statement in the company’s proxy statement.

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AES “Games” SEC: CII Seeks Correction

CII sent an important letter to the SEC on a recent no-action issued to the AES Corporation (AES) (not yet posted). A similar no-action had been granted in 2016 to Illumina (ILMN) on a proposal I (James McRitchie) had submitted. ISS referenced both. From the facts regarding AES, it appears John Chevedden submitted a proposal to lower the required threshold for shareholder to call a special meeting. The current standard is 25%. Chevedden’s proposal requested 10%. The SEC’s no-action letter gave the following rationale: Continue Reading →

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