The term-end crunch continues! Yesterday, the SEC voted, without an open meeting, to issue two separate proposals to amend Rule 701 and Form S-8, both “substantially informed by public comment” received in response to the SEC’s July 2018 Concept Release on Compensatory Security Offerings and Sales. First, the SEC is proposing new amendments, on a temporary five-year trial basis, that would allow a company to provide equity compensation to a slice of “gig” workers—specifically only “platform workers” who provide services through the company’s technology-based platform—subject to percentage limits (no more than 15% of annual compensation), dollar limits (no more than $75,000 in three years) and other conditions. The proposal is structured as temporary to allow the SEC an opportunity to assess whether issuances are being made for legitimate compensatory purposes and not for capital-raising purposes, whether the issuances benefit companies, platform workers and other investors in the “gig economy,” and whether there are any unintended consequences. To help with that assessment, looking toward an evaluation of whether to make the rule permanent, the SEC will require participating companies to furnish certain information to the SEC at six-month intervals. Second, the SEC is also proposing amendments to Rule 701 and Form S-8 designed to modernize the framework for compensatory securities offerings in light of the significant evolution in compensatory offerings and composition of the workforce since the SEC last substantively amended those regulations. Both proposals will be open for public comment for 60 days.
Here’s some mighty fine reading: Cooley Alert: SEC Amends Rule 701(e) and Issues Concept Release Regarding Rule 701 and Form S-8.
Just under the wire to satisfy a Congressional mandate, the SEC today voted unanimously to adopt an amendment to Rule 701(e) to raise the threshold that triggers the requirement for delivery of additional disclosure to investors. The Commissioners also voted to issue a concept release soliciting comment on potential revisions to modernize Rule 701 and Form S-8, as Chair Jay Clayton observed, in light of “developments and innovations in labor markets and compensation practices.” The amendment to Rule 701(e) will become effective immediately on publication in the Federal Register. Companies that “have commenced an offering in the current 12-month period will be able to apply the new $10 million disclosure threshold immediately upon effectiveness of the amendment.” Here is the press release, here are the final rules, and here is the concept release.
by Cydney Posner Today, Corp Fin posted a new CDI under both Securities Act Section 5 and Form S-8. The CDI involves the issue of whether a company-sponsored 401(k) plan that does not offer an employer securities fund as an investment alternative might still be deemed to be offering employer […]
Will the SEC finally provide some relief from the nearly incomprehensible proxy statement requirement for a New Plan Benefits Table?
by Cydney Posner Keith Higgins, Director of Corp Fin, hinted that he might be giving us a welcome gift in the future: a revision of Item 10 of Schedule 14A, the proxy statement – in my view, a component of the disclosure rules that has too long been ignored and […]