Category: Other categories

Did you catch these developments for the 2019 proxy statement and Form 10-K?

Cam C. Hoang

The 10-K and proxy season begins in a little over a month for companies with calendar fiscal year-ends.  The following governance and disclosure developments should be considered in the course of preparing these filings. For additional background, see our presentation and supplemental materials for Preparing for the 2019 SEC Reporting Season. Proxy Statement Impact of the government shutdown: During the government shut down, the SEC is...

ISS Updates FAQs on US Compensation Policies

Cam C. Hoang

ISS released its annual update of frequently asked questions on its US Compensation Policies on December 20, 2018 (preliminary updates had been released in November). The updates are effective for shareholder meetings occurring on or after February 1, 2019. There are nine new or materially updated questions, which are summarized below: #19 Will any of the quantitative pay-for-performance screens change in 2019?  No.  The screens...

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...

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...

SEC Withdraws No Action Letters on Proxy Advisory Firms

Cam C. Hoang

In order to facilitate discussion on the role of proxy advisory firms at the upcoming Roundtable on the Proxy Process, which is scheduled for November 2018, the SEC staff has determined to withdraw two no action letters that provided comfort to investment advisers in relying on proxy advisory firm recommendations: In Egan-Jones Proxy Services (May 27, 2004), the staff had confirmed that by voting based on the...

CEO Pay Ratio Rule Will Not Be Delayed

Cam C. Hoang

At last Friday’s ABA annual meeting, Bill Hinman (with the standard disclaimer that he is speaking for himself and not on behalf of the SEC) confirmed that the SEC will not be delaying implementation of the CEO pay ratio rule, which will require most public companies to report the pay ratio in their 2018 proxy statements, for the first fiscal year beginning on or after...

Vanguard Shareholder Climate Change Proposal Withdrawn

Cam C. Hoang

As previously reported on this blog, Vanguard received a shareholder proposal requesting additional disclosure on its climate change voting record, and the proposal was scheduled to appear on the agenda for Vanguard’s 2017 annual meeting.   Today, Vanguard announced that it had negotiated the proposal’s withdrawal. Glenn Booraem, the Vanguard Funds’ Investment Stewardship Officer, commented: “Climate change represents an evolving set of risks and opportunities...

2016 Amendments to the Delaware General Corporation Law

Kimberley R. Anderson

The DGCL was amended in June.  Most notably, the amendments (i) broadened the availability of Section 251(h) mergers consummated without stockholder approval following a first-step tender or exchange offer for all shares entitled to vote on the merger, (ii) eliminated de minimis appraisal claims under Section 262, and (iii) allows companies to make a pre-judgment payment to dissenting stockholders to reduce interest costs in connection...