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On October 26, 2022, the SEC issued its final clawback rules under Section 954 of the Dodd-Frank Act. The NYSE and Nasdaq filed their proposed listing standards to implement the SEC's clawback rules on February 22, 2023, which remain subject to SEC publication and a comment period.
This Client Alert looks the the new clawback rules' requirements and what they mean for companies along with considerations as companies look to ensure their clawback policies will be compliant. Click HERE to download the Client Alert in PDF. On February 10, 2023, the SEC posted new compliance and disclosure interpretations (C&DIs) covering the new pay versus performance (PVP) disclosures.
The Client Alert looks at these C&DIs and offers a sample table that can be used in the footnotes to the PVP Table to comply with the C&DI requiring more details of equity award adjustments, which cannot be provided on an aggregate basis and must be shown by specific categories. Click HERE to download the Client Alert in PDF. On December 14, 2022, the SEC released final amendments to the Rule 10b5-1 trading plans. Rule 10b5-1 provides an affirmative defense to insider trading for individuals and issuers that trade stock under a plan entered in good faith at a time when they do not possess material nonpublic information. The final amendments provide additional requirements in order to avail oneself of the affirmative defense to insider trading allegations.
Click here to download the Client Alert in PDF. On August 25, 2022, the SEC issued its final pay versus performance (PVP) rules under Section 953(a) of the Dodd-Frank Act, effective for proxy and information statements covering fiscal years ending on or after December 16, 2022. Thus, these new rules will generally apply to proxy statements filed in 2023.
These final PVP rules impose new disclosure requirements on public companies. This Client Alert reviews these new disclosure requirements and offers Exequity's comments on them, as well as provides next steps for companies to take now before the traditional proxy drafting starts later this year. Click here to download the Client Alert in PDF. This Client Alert looks at the final rules impacting proxy advisors that the SEC adopted July 22, 2020. The Client Alert discusses the SEC action to codify that "solicitation" includes providing proxy vote recommendations, modifications of the anti-fraud provision to address failure of proxy advisors to disclose material information, the implications of these changes for proxy advisors, and details of the "safe harbor" proxy advisors can use to avoid having to comply with the proxy voting rules.
The final rules are effective 60 days after publication in the Federal Register. However, the final rules do not apply to proxy advisors until December 1, 2021. Click here to download the Client Alert in PDF. On November 5, 2019, the SEC met and issued two sets of proposed changes to existing rules. One impacts proxy advisors (known in SEC-speak as "proxy voting advice businesses"), such as Institutional Shareholder Services, Inc. and Glass, Lewis & Co., and the other proposed rule impacts the requirements for shareholders to submit proposals.
This Client Alert summarizes these proposed rule changes. Click here to download this Client Alert. On August 21, 2019, the Securities and Exchange Commission (SEC) issued guidance to proxy advisors regarding the applicability of the proxy rules to proxy voting advice. The SEC also issued separate guidance to investment advisers regarding their proxy voting responsibilities. Combined, this guidance likely will impact both proxy advisors and how investment advisers handle proxy voting, which, in turn, could significantly change the proxy voting landscape for public companies.
This Client Alert reviews this SEC guidance as well as some of the potential impacts. Click here to download this Client Alert On December 18, 2018, the SEC announced it had finalized the hedging rules required by the Dodd-Frank Act. This Client Alert discusses the new rules and the timing of their application.
Click HERE to download the Client Alert (PDF) On September 21, 2017, the SEC released several items providing additional guidance regarding CEO Pay Ratio. The new guidance took the form of an SEC Release, guidance from the Division of Corporation Finance, and new, modified and withdrawn Compliance and Disclosure Interpretations. The Exequity Client Alert reviews all of this new guidance.
Download Client Alert [PDF] On April 21, 2016, the National Credit Union Administration (NCUA) issued new proposed rules governing incentive compensation arrangements for financial institutions.1 The U.S. Securities and Exchange Commission (SEC) issued its version of these proposed rules on May 6, 2016 (Proposed Rule).2 The Office of the Comptroller of the Currency, Treasury (OCC), Board of Governors of the Federal Reserve System (Board), Federal Deposit Insurance Corporation (FDIC), and the Federal Housing Finance Agency (FHFA) are all expected to issue similar rules shortly. These proposed rules are designed to implement Section 956 of the Dodd-Frank Wall Street Reform and Consumer Protection Act (Dodd-Frank Act). These proposed rules are revisions of the proposed rules released by all of the above agencies in 2011. This Client Alert looks at the new proposed rules.
Download Client Alert (PDF) On August 5, 2015, the SEC issued the final CEO Pay Ratio rule. This Client Alert looks at the requirements of the rule and points out differences from the rule as proposed back in 2013.
Download Client Alert (PDF) On June 30, 2014, the U.S. Securities and Exchange Commission issued Staff Legal Bulletin No. 20 (SLB 20), which provides guidance for investment advisers concerning their proxy voting responsibilities as well as discusses the availability of exemptions from the proxy rules for proxy advisory firms, e.g., Institutional Shareholder Services, Inc. and Glass Lewis & Co., LLC. This Client Alert looks at the guidance provided by SLB 20, which does not represent a significant change from prior industry practice.
Download Client Alert (PDF) On September 25, 2012, the New York Stock Exchange (the "NYSE") and, on September 26, 2012, the NASDAQ Stock Market ("NASDAQ") filed proposed changes to their rules for listed companies with the Securities and Exchange Commission (the "SEC"). The NYSE and NASDAQ proposed rule changes are intended to implement the final rules the SEC passed in June 2012 to comply with the provisions of Section 952 of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, which added Section 10C to the Securities Exchange Act of 1934. This Client Alert provides an overview of these proposed changes, the proposed timing for their implementation, and Exequity's commentary on the rules.
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