Category: Exchange Act Reporting and Disclosure Effectiveness

SEC Adopts Hedging Disclosure Rules

Kimberley R. Anderson

The SEC adopted new rules today that will require disclosure of a company’s hedging policies in proxy statements or information statements relating to the election of directors. The new rules are set forth in new Item 407(i) of Regulation S-K and require a company to describe any practices or policies it has adopted regarding the ability of its employees, officers or directors to engage in...

ISS Provides 2019 Voting Policy Updates

Michael Newton

ISS recently announced the 2019 updates to its proxy voting policies, which can be found here and which will be applied to annual meetings held on or after February 1, 2019. Among the various updates provided by ISS, the following policies are particularly relevant for our clients, because they expand the circumstances in which ISS may recommend votes against director candidates: Absence of Board Gender...

Effective Date for Disclosure Simplification

Kimberley R. Anderson

On August 17th, the SEC adopted amendments updating and simplifying disclosure rules.  See our prior summaries here and here.  The rules have finally been posted today in the Federal Register, which makes them effective November 5, 2018.    Among the amendments is the extension of a previously annual requirement to interim periods, to present a statement of changes in shareholders’ equity and to disclose the...

SEC Clarifies Effective Date for Disclosure Simplification Rules

Cam C. Hoang

In August, the SEC adopted amendments updating and simplifying disclosure rules. See our prior summary here. Notable amendments included: the extension of a previously annual requirement to interim periods, to present a statement of changes in shareholders’ equity and to disclose the amount of dividends per share for each class of shares (vs common shares only) (either in a separate statement or a footnote)(revised Rules...

New SEC Rules Eliminates Duplicative, Overlapping, Outdated Disclosure Requirements

Cam C. Hoang

The Securities and Exchange Commission (SEC) announced last Friday that it has adopted amendments to certain disclosure requirements that have become duplicative, overlapping, or outdated in light of other Commission disclosure requirements, US Generally Accepted Accounting Principles (GAAP), or changes in the information environment.   These amendments were originally proposed in 2016, in order to implement provisions of the Fixing America’s Surface Transportation (FAST) Act.  ...

SEC Issues $1.75 Million Penalty Over Perks Disclosures

Cam C. Hoang

A recent SEC consent order against The Dow Chemical Company reminds companies that when evaluating whether or not to disclose a payment or benefit to an executive as a perk in a proxy statement, the fact that the item has a tangential business purpose, or is convenient for the company, is insufficient grounds to exclude the item as a perk.  In order to be excluded as...

SEC Approves Series of Final and Proposed Rules in Line with Stated Priorities

Cam C. Hoang

The SEC held a very busy open meeting yesterday, voting on the following final and proposed rules: Adoption of amendments to modernize the definition of “smaller reporting company,” which was established in 2008.  See our previous discussion of the amendments.   Adoption of amendments to require the use of the Inline XBRL format in certain filings, which were proposed in 2017 and have been under...

SEC Expands on “Smaller Reporting Companies” Eligible for Scaled Disclosure

Cam C. Hoang

The SEC announced that it has voted to amend the definition of “smaller reporting company,” or “SRC,” expanding the population of companies that qualify for a range of scaled (reduced) disclosure requirements. The rules will become effective 60 days after publication in the Federal Register. Examples of scaled disclosure include that SRCs, in their annual reports on Form 10-K, are not obligated to include risk...

SEC Guidance on Cybersecurity Disclosure and Policies – Recap of Dorsey Webinar Presentation

Gary L. Tygesson

Earlier this week, Dorsey hosted a webinar panel presentation on the SEC’s recent guidance on cybersecurity disclosures and policies. The webinar provided a detailed walk-through of the SEC’s guidance, including issues related to enhanced disclosure, insider trading, and Reg FD policies. The panel also discussed the impact of the SEC’s guidance within the changing landscape of cybersecurity and current developments in shareholder litigation, SEC enforcement actions,...

Failure to Disclose Leads to $35 Million Penalty in the Yahoo! Cybersecurity Breach

Cam C. Hoang

The Securities and Exchange Commission (the “SEC”) announced Tuesday that Altaba, the entity formerly known as Yahoo! Inc., has agreed to pay a $35 million penalty to settle charges that it misled investors by failing to disclose one of the world’s largest data breaches in which hackers stole personal data relating to hundreds of millions of user accounts. According to the SEC’s order, within days...