Preparing Proxy Materials in an Electronic Age
Wheeler, Jennifer, THE JOURNAL RECORD
As many public corporations prepare for their upcoming 2000 annual shareholders' meetings, some corporations are introducing a new concept in their proxy materials -- electronic delivery and electronic voting.
Conventionally, a corporation prepares for its annual shareholders' meeting by preparing a proxy statement, (a document often in excess of 100 pages), printing the proxy statement and proxy voting card (a process that can cost thousands of dollars) and mailing the proxy materials to all of its shareholders (a significant undertaking for any public corporation).
At this point, the conventional corporation waits and waits and waits for shareholders to return their proxy voting cards by mail (with postage prepaid by the corporation) indicating their voting preferences.
In today's age of e-mail, Web sites and high-speed Internet access, some corporations are trying to find an alternative to the costs and delays presently associated with delivering annual proxy materials.
These corporations are offering their shareholders the opportunity to receive proxy materials electronically and to vote electronically, too.
By offering proxy materials electronically, a corporation can reduce the costs associated with its annual shareholders' meeting substantially, eliminating much of the printing and postage costs that be in excess of several thousands of dollars. Additionally, delivering proxy materials electronically and offering an electronic voting option is much faster than the standard "snail mail" delivery.
A corporation can literally send its proxy materials to a shareholder and receive the shareholder's electronic vote on the same day.
The Securities and Exchange Commission has approved electronic delivery of corporate documents, including proxy materials, provided certain guidelines are followed:
* The shareholder must consent to electronic delivery.
* The corporation must give the shareholder notice that the materials have been delivered electronically.
* The shareholder must have access to the electronic documents -- must be able to print them.
* The corporation must receive evidence that electronic delivery was achieved.
The SEC guidelines for electronic voting provide that:
The corporation must be able to verify the authenticity of proxies -- such as by including a control number on the proxy card.
* The shareholder must be able to verify that his or her vote was received correctly. …