Court Considers SEC’s Unbundling Rules, Common Sense Abound
We recently had the occasion in our office to review a proxy statement that recommended certain amendments of a company’s certificate of incorporation. This got us thinking about the SEC’s “unbundling” requirements.
After shortly rehashing the rule, we’ll happily move into quite a bit of plain English analysis. First, Rule 14a-4(a)(3), requires that the form of proxy “shall identify clearly and impartially each separate matter intended to be acted upon, whether or not related to or conditioned on the approval of other matters.” 17 C.F.R. §240.14a-4(a)(3). Rule 14a-4(b)(1) requires that shareholders have “an opportunity to specify by boxes a choice between approval or disapproval of, or abstention with respect to each separate matter referred to therein as intended to be acted upon.” 17 C.F.R. § 240.14a-4(b)(1). Therefore, the “unbundling” rules “require distinct voting items on ‘each separate matter’” in a management proposal. 17 C.F.R. […]