Archive December 22, 2009

Transition Guidance for SEC’s New Proxy Disclosure Rules Issued

Earlier today the SEC issued several Compliance & Disclosure Interpretations (C&DIs) that provide guidance to companies on how to transition to the final proxy disclosure rules issued on December 16, 2009.  There had been a number of questions regarding how and when the new rules would apply.

  • For companies with fiscal years ending on or after December 20, 2009, they will have to file their Form 10-K and proxy statement in compliance with the new rules.
  • If a company is not required to comply with the new rules, it can do so voluntarily so long as it complies with all the other requirements applicable to the form it files.
  • If a company is becoming subject to the securities disclosure rules and files a registration statement on or after December 20, 2009, it would have to comply with the new Regulation S-K amendments for such registration statement to be declared effective on or after February 28, 2010.
  • As to the Form 8-K requirements applicable to the reporting of shareholder voting results, these will apply to any meeting that takes place on or after February 28, 2010.

The full text of the C&DIs can be found at:


SEC Issues Final Proxy Disclosure Rule Amendments

The U.S. Securities and Exchange Commission met this morning and voted 4 to 1 in favor of approving the amendments to the proxy disclosure rules that were issued over the summer with some changes.  I’ll review the final amended rules and blog in the coming days about the changes that will impact equity compensation.  In the meantime, I wanted to make sure folks knew the final rules were posted to the SEC’s website this afternoon and can be accessed at:


Where’s Waldo? Where can you put the Equity Compensation Plan Information Table?

Generally, the Equity Compensation Plan Information table is included in a company’s Form 10-K, unless a company is putting a compensation-related matter to shareholders on its proxy.

However, this could lead to confusing your shareholders as the table would then bounce back and forth between the Form 10-K and the proxy, simply depending on whether a company is putting a compensation matter to shareholders.  Some companies have wondered if they could simply just put the table into their proxy all the time and simply reference it in the Form 10-K.  The short answer: yes, companies can do that.

The rules governing the Equity Compensation Plan Information Table,Item 201(d) under Regulation S-K, can be found at:

 Helpfully, the SEC has issued a Compliance & Disclosure Interpretation which specifically addresses this issue and indicates that it is permissible to incorporate by reference the table if it is included in a proxy, even if no compensation plan is put to shareholders for a vote:

Question 106.01

Question: Is the Item 201(d) disclosure required in Part II of Form 10-K, given that Item 5 of Form 10-K indicates that the registrant is required to furnish the information required under Item 201, or should the Item 201(d) disclosure be included (or incorporated by reference) in Part III of Form 10-K given that Item 12 indicates that the registrant is required to furnish the information required under Item 201(d)?

Answer: The Item 201(d) disclosure should be included in Part III, Item 12 of Form 10-K. An issuer may rely on General Instruction G.3 to Form 10-K to incorporate by reference the Item 201(d) disclosure from its proxy statement or information statement, even if the issuer did not submit a compensation plan for security holder action at its annual meeting of security holders. See American Bar Association (Jan. 30, 2004). [Mar. 13, 2007]

Link to the SEC’s C&DIs:


NASPP Chicago Presentation – RiskMetrics’ 2010 Policy Updates and Implications

This presentation was used by Ed at a meeting of the National Association of Stock Plan Professionals’ Chicago Chapter on December 8, 2009.

Ed looks at the possible implications from the changes to the way RiskMetrics determines stock price and volatility as well as illustrates the significant changes for maximum burn rates under RiskMetrics’ Burn Rate Table for Russell 3000 companies.

Presentation (PDF click HERE)