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In addition to rescinding Staff Legal Bulletin 14L, SLB 14M addresses various other aspects of Rule 14a-8. SLB 14L had addressed several of these items as well – the new Bulletin is carrying some things forward and also refining & clarifying the guidance. Here are key takeaways:

1. 2022 Proposal: Confirms the 2022 proposal to amend Rule 14a-8 has not been adopted and is not operative

2. Graphics: States that proponents can use graphics in their proposals, but noting that exclusion may be appropriate under 14a-8(i)(3) where they make the proposal materially false or misleading, render the proposal inherently vague, etc. Also, words in the graphics count towards the proposal’s 500-word limit.

3. Proof of Ownership: Discourages an overly technical reading of proof of ownership letters as a means to exclude a proposal. Also, stating that brokers and banks can continue to provide confirmation of how many shares the proponent held continuously and need not separately calculate the share valuation, and stating that the Staff does not view Rule 14a-8 as requiring a company to send a second deficiency notice to a proponent if the company previously sent an adequate deficiency notice prior to receiving the proponent’s proof of ownership and the company believes that the proponent’s proof of ownership letter contains a defect.

4. Email Communications: To prove delivery of email under Rule 14a-8, the Staff suggests that senders should seek a reply email from the recipient in which the recipient acknowledges receipt and encourages both companies and proponents to do acknowledge receipt when requested. The staff doesn’t consider screenshots of emails on the sender’s device to be proof of delivery. The Staff shares views on submission of proposals, delivery of notices of defects, and responses to notices of defects.

– Liz Dunshee