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- SEC Adopts Proxy Access
- Dodd Act Change Immediately Affects Private Offerings
- FASB Issues New Exposure Draft on Disclosure of Certain Loss Contingencies
- Financial Reform Act Triggers Significant New Executive Compensation Requirements
- U.S. Senate Passes Consumer Financial Protection Act of 2010
- New Qualifying Therapeutic Discovery Project Credit Will Benefit Biotech Companies
- Federal HIRE Act Provides New Tax Benefits for Hiring Unemployed Workers
- New Form 8-K Item 5.07 Will Affect S-3 Eligibility
- Revised NYSE Corporate Governance Listing Standards Effective as of January 1, 2010
- SEC Approves Proxy Disclosure Enhancements
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SEC Adopts Proxy Access
This week, the SEC adoped final rules on proxy access which will require companies to povide certain shareholders or shareholder groups the opportunity to nominate candidates for boards of directors and to include information in the company's proxy materials about, and the ability to vote for, these shareholder nominees.
Dodd Act Change Immediately Affects Private Offerings
The Dodd-Frank Wall Street Reform and Consumer Protection Act immediately revised the net worth test for determining whether an individual investor is an “accredited investor” for purposes of Regulation D and Section 4(6) of the Securities Act of 1933. Specifically, as revised, prospective investors can no longer include the value of their primary residence for purposes of satisfying the $1 million net worth test. Historically, many investors have relied on the value of their homes for purposes of qualifying as an accredited investor. This immediately effective provision applies to offerings that are already in progress, including those that have had initial closings.
FASB Issues New Exposure Draft on Disclosure of Certain Loss Contingencies
On July 20, 2010, the Financial Accounting Standards Board issued a new Exposure Draft of a proposed Statement, Contingencies (Topic 450), Disclosure of Certain Loss Contingencies. The FASB has proposed various amendments to Topic 450, formerly known as FASB Statement No. 5, in response to investor concerns about the inadequacy of information currently available regarding the likelihood, timing and amount of future cash flows associated with loss contingencies.
U.S. Senate Passes Consumer Financial Protection Act of 2010
The Senate recently passed the Consumer Financial Protection Act of 2010 and, like the House financial reform legislation passed back in December, it has a lot to say on corporate governance and executive compensation.
New Form 8-K Item 5.07 Will Affect S-3 Eligibility
As part of its recently adopted Final Rules on Proxy Disclosure Enhancements, the SEC added a new Item 5.07 to Form 8-K. Item 5.07 requires a company to report the results of voting at any shareholders meeting within four business days after the meeting at which the vote was held.
Revised NYSE Corporate Governance Listing Standards Effective as of January 1, 2010
As approved by the SEC, the revised rules (more fully described in this SEC Release) basically conform the NYSE corporate governance listing standards to the requirements of Item 407 of Regulation S-K and to Form 8-K by eliminating duplicative disclosure requirements currently included in the NYSE standards and directly incorporating the Item 407 requirements.
SEC Approves Proxy Disclosure Enhancements
On December 16, 2009, the SEC voted to approve final rules on proxy disclosure and solicitation enhancements which had been initially proposed by the SEC in July 2009. As stated in the SEC's adopting release the new rules will be effective February 28, 2010, meaning they will apply to the 2010 proxy season for substantially all calendar year issuers.
Changes to Voting in Director Elections
While we continue to monitor all of the regulations and rule changes proposed by the SEC as well as the different and overlapping versions of legislation proposed in Congress, we know that at least one rule proposal has been approved and will be in effect on January 1, 2010.
SEC Proxy Access Comment Period Re-Opened
Following up on its June proposal to change federal proxy rules to facilitate the rights of shareholders to nominate directors, on December 14 the Securities and Exchange Commission announced that it is re-opening the public comment period to "seek views on additional data and related analyses." The SEC staff continues to expect to make a final recommendation to the Commission "early next year."
New SEC Position Regarding Proxy Statement Comment Letters
One non-regulatory proxy statement-related development of note is the SEC’s new position on responses to proxy statement comments. The position was articulated by Shelley Parratt, the SEC’s Deputy Director, Division of Corporation Finance at a November 2009 conference.