CARL T. HAGBERG AND ASSOCIATES
STRATEGIC MARKETING, SHAREHOLDER RELATIONS AND
SHAREHOLDER SERVICE CONSULTANTS
6 SOUTH LAKEVIEW DRIVE
JACKSON, NJ 08527-2707
(732) 928-6133 - FAX (732) 928-6136
February 2, 2000
Mr. Jonathan Katz
Securities & Exchange Commission
450 Fifth Street NW
Washington, DC 20549
Re: Comments on Release Nos. 33-7767, 34-42102, IC-24124 (File No. S7-26-99)
"DELIVERY of PROXY and INFORMATION STATEMENTS to HOUSEHOLDS"
Dear Mr. Katz:
As, arguably, the "head of a household" whose members maintain six brokerage accounts (three of them IRAs) and where four household members also maintain "registered shareholder" and "employee shareholder" accounts in a variety of U.S. stocks...and also as a consultant to publicly-held companies who specializes in ways to reduce the costs of communicating with investors, while maintaining or improving the overall quality of such communications, I wish to offer a few comments and recommendations on the "Householding Release."
I strongly urge the Commission to allow issuers to "household" Annual Reports, proxy and information statements and proxy cards/voting instruction cards without obtaining the prior consent of household members, as long as 30 days notice of the "intent to household" is given.
I also urge the Commission to specify that the notice of the intent to household can accompany the householded materials themselves, as long as the following conditions are met:
Because it is impossible to determine who is the head of any household, and because the "titular head" may not always own the same stocks as other family members...and because of practical limitations on what enclosing equipment can and cannot do, issuers should be allowed to address householded materials to any member of a household.
Because issuers and their service providers need some lead-time to implement any household program - and because more than half of all Annual Meeting materials will be mailed in March and April - I urgently request the Commission to take action in February.
In support of these recommendations I would cite the following facts:
Frankly, I believe that every issuer could adopt the procedures outlined above without SEC rulemaking, under the commonsense principle of "no harm, no foul." But issuers, quite understandably, do not wish to fall afoul of the letter of SEC rulemaking proposals, even when the consequences seem to be nil.
Accordingly, I strongly urge the Commission to amend its proposed "housekeeping rules" as suggested above, and to do so this month.
Because timing is so critical here - and because I understand the staff may still be studying the need to have the rules track the "prospectus delivery rules" - I would suggest that the householding procedures involving proxies and "corporate actions" could be proposed in time for this season as "pilot program" rules. This would allow issuers (and the SEC) to test the assumptions, the technologies and the vendor capabilities that are available and will enable many issuers to realize very significant dollar savings this year.
Thank you very much for your attention to the householding issue and please feel free to contact me if there are other questions I might answer.
Very truly yours,
Carl T. Hagberg
Chairman & Chief Executive Officer