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SEC Issues Final Proxy Disclosure Rule Amendments

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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?

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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: http://www.law.uc.edu/CCL/regS-K/SK201.html

 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: http://www.sec.gov/divisions/corpfin/guidance/regs-kinterp.htm


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