Voglio sapere a riguardo di…

68374

Federal Register / Vol. 86, No. 228 / Wednesday, December 1, 2021 / Rules and Regulations
lotter on DSK11XQN23PROD with RULES2

statement to learn about those nominees and make an informed voting decision.400 For a shareholder that is motivated enough to vote in a director election, we generally do not think that having to seek out the dissidents proxy statement online through EDGAR is a burden large enough to discourage the investor from making the effort to become informed about the dissidents nominees. However, we cannot rule out that there will be some shareholders at the margin who will not be willing to expend the effort required to find the information, and consequently become discouraged enough that they do not follow through on their plans to vote in the election, but we think this will be a small fraction of otherwise interested shareholders. More importantly, given that there is no minimum solicitation requirement in place currently under the baseline, and assuming current dissidents conducting typical contests will not reduce their solicitation efforts under the final amendments, we expect that more rather than fewer shareholders will directly receive dissidents proxy statements.
Dissemination of Proxy Materials The final amendments will require any dissident in a contested election to file a proxy statement by the later of 25
calendar days prior to the meeting date, or five calendar days after the date that the registrant files its definitive proxy statement, regardless of the choice of proxy delivery method. This requirement will help to ensure that all shareholders who receive a universal proxy, which will not be required to include complete information about the opposing partys nominees, will have access to information about all nominees a sufficient time before the meeting. We do not expect this requirement to impose a substantial burden or constraint on dissidents given existing requirements and the notice requirement of the final amendments.
In particular, dissidents that elect notice-only delivery are currently required to make their proxy statement available at the later of 40 calendar days prior to the meeting date or 10 calendar days after the registrant files its definitive proxy statement. For such dissidents, the required filing deadline will provide five fewer days to furnish a proxy statement in cases in which the registrant files its definitive proxy statement within fewer than 30 calendar days of the meeting date, which we estimate occurred in approximately 11% of recent contested elections, and this new deadline should not otherwise 400 See
Section IV.D.5.b of the Proposing Release.

VerDate Sep<11>2014

19:03 Nov 30, 2021

Jkt 256001

present an incremental timing constraint for such dissidents.401
Dissidents that elect full set delivery are not currently subject to any such requirement, and thus the dissemination requirement would impose a new filing deadline for all such dissidents. Some dissidents may therefore be required to prepare their proxy statements earlier than they would otherwise. In particular, we estimate that dissidents filed a definitive proxy statement within 25 days of the meeting in 18% of recent contested elections.402
In the absence of other requirements, the required filing deadline might prevent late-breaking proxy contests.
However, because the final amendments separately require dissidents to provide notice of the contest and the names of their nominees by the 60th calendar day before the anniversary of the prior years meeting with alternative treatment for cases in which the meeting date has changed significantly since the prior year, we do not expect this requirement to impose a significant further limitation on late-breaking contests. Also, while the filing deadline will require some dissidents to prepare their proxy statements earlier than they would otherwise, we do not expect this requirement to impose a substantial incremental constraint or burden in most cases. In particular, because of the notice requirement, dissidents will generally have approximately one month to furnish a definitive proxy statement after having provided the names of their nominees to the registrant.
Alternatively, we have considered proposing an earlier filing deadline for dissidents. While an earlier filing deadline may reduce the risk that some shareholders receive the registrants proxy statement and make their voting decisions before the dissidents proxy statement is available, such a deadline may also impose an incremental burden on dissidents and could prevent some late-breaking proxy contests beyond those prevented by the notice requirement.
One commenter expressed concerns that imposing a filing deadline on the dissident without imposing a similar filing deadline on registrants would confer a strategic advantage to registrants.403 As an alternative, we considered adopting a similar 25-day filing deadline also for registrants, which would mitigate such concerns.
However, as discussed in more detail 401 Based on staff review of contested elections initiated in years 20172020.
402 Id.
403 See letters from Olshan.

PO 00000

Frm 00046

Fmt 4701

Sfmt 4700

above, registrants already have incentives to file their definitive proxy statement well in advance of the meeting date.404 Providing further evidence for such incentives, we find that 95% of registrants in a sample of recent contest filed their definitive proxy statement at least 25 days before the annual meeting.405 Thus, despite the absence of a filing deadline for registrants, it is unlikely that the required 25-day filing deadline for dissidents in the final amendments will confer significant strategic benefits to registrants.
Formatting and Presentation of the Universal Proxy Card The final amendments specify certain presentation and formatting requirements for universal proxies. We do not expect the presentation and formatting requirements to impose any significant direct costs on registrants or dissidents, though they may bear some indirect costs in the form of reduced flexibility to strategically design their proxy card.
These presentation and formatting requirements are expected to mitigate the risk that shareholders receiving universal proxies may be confused about their voting choices and how to properly mark their card. For example, shareholders could otherwise be unsure about the total number of candidates for which they can grant authority to vote, or about which candidates are nominated by which party. Such confusion could increase the likelihood that some shareholders submit invalid proxies or submit proxies that do not reflect their intentions.406 This may be exacerbated in the case of nominees being put forth by multiple dissidents or when there are proxy access nominees as well as dissident and registrant nominees.407
In addition to preventing confusion, these presentation and formatting requirements may also promote the fair and equal presentation of all nominees on the proxy cards. In particular, these requirements would prevent registrants and dissidents from strategically choosing the font, style, sizing, and order of candidate names in ways that could create an advantage for their slate.
For example, political science research has found that the order of placement of 404 See
supra Section II.E.3.
on a review of the 101 contested elections initiated from 2017 through 2020.
406 See letter from BR for similar concerns.
407 See, e.g., Roundtable Transcript, comment of David Katz, Partner, Wachtell, Lipton, Rosen and Katz, at 42.
405 Based
E:FRFM01DER2.SGM

01DER2