March 26, 2009
Dear Ms. Murphy:
I am writing to comment on the proposal by the New York Stock Exchange to eliminate broker discretionary voting in the election of directors by amending NYSE Rule 452(File No. SR-NYSE-2006-92).
MGE Energy is an issuer with two thirds of our shares held by individuals. Fifty percent of our street shares are held by retail holders. Under the current system MGE Energy cannot reach out directly to these street holders and must pay a third party for our proxy solicitation. A loss of broker discretionary votes under the current system will mean repeated and costly third party solicitations to individual retail holders. This will increase our costs significantly for what should be a routine matter.
Broker discretionary voting is just one issue of many in the integrated and overly complicated proxy voting and communications system. A number of important issues in the current proxy system include:
Artificial barriers between public companies and their retail investors should be eliminated and replaced with a system that encourages investor dialogue and communication. Unless the proxy system is modernized, singular regulatory actions by the Commission—such as the proposed change to Rule 452—run the risk of further disenfranchising large numbers of individual shareholders.
For these reasons, MGE Energy urges the SEC to undertake a comprehensive review of the proxy processing system and refrain from adopting piecemeal changes to a system that involves so many integrated elements.
Kenneth G. Frassetto
Director-Treasury Management and Shareholder Services MGE Energy, Inc.
P.O. Box 1231
Madison, WI 53701-1231