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SEC Issues Guidance Limiting Exclusion of Shareholder Proposals

This blog post discusses recent SEC guidance that will adversely impact the ability of reporting companies to exclude shareholder proposals from their proxy materials. The bulletin issued by the SEC significantly narrows the "conflicting proposals" exclusion under
Rule 14a-8(i)(9) and confirms the SEC's historical interpretation of the "ordinary business" exclusion under Rule 14a-8(i)(7).

On October 22, 2015, the Staff of the Securities and Exchange Commission (the “Staff”) issued Staff Legal Bulletin No. 14H (the “Bulletin”), which provides guidance on how the Staff will evaluate arguments for excluding Rule 14a-8 shareholder proposals from reporting companies’ proxy materials.  The Bulletin significantly narrowed the “conflicting proposals” exclusion under Rule 14a-8(i)(9) and confirmed the Staff’s historical interpretation of the “ordinary business” exclusion under Rule 14a-8(i)(7).  The firm's full Client Alert can be found here.

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