On December 13, 2022, the staff of the Division of Corporation Finance (the “Staff”) of the Securities and Exchange Commission announced an update to its Compliance and Disclosure Interpretations (“C&DIs”) on Non-GAAP Financial Measures under Questions 100.01, 100.04 – 100.06, and 102.10(a)(b)(c). Many of the changes memorialize positions the Staff has taken in comment letters or provide additional detail about those positions.
Securities Regulation
EDGAR Ready to Accept Online Form 144 Filings Ahead of Deadline for Electronic Filing Requirement
Since September 23, 2022, the Securities and Exchange Commission (the “SEC") Electronic Data Gathering, Analysis, and Retrieval (“EDGAR") system has been ready to accept electronic Form 144 filings, pursuant to the SEC’s recent amendments requiring certain Forms 144 to be filed electronically. Filers have approximately six months from September 2022 to transition to electronic filing of Forms 144. The SEC’s compliance date is April 13, 2023.
SEC Raises Annual Gross Revenue Amount in the Definition of Emerging Growth Company
On September 9, 2022, the Securities and Exchange Commission (the “SEC”) amended its rules to
implement inflation-adjusted amendments to Rule 405 of the Securities Act of 1933, as amended (the “Securities Act”) and Rule 12b-2 of the Securities Exchange Act of 1932, as amended (the “Exchange Act”), and raised the annual gross revenue amount in the definition of “emerging growth company” (“EGC”) from $1,070,000,000 to $1,235,000,000. The final rule (available
Division of Corporation Finance Issues Interpretive Guidance on the SEC’s Universal Proxy Rules
On August 31, 2022, the universal proxy rules adopted late last year by the Securities and Exchange Commission (the “SEC") will become effective. As discussed in our previous client alert, the rules require proxy cards distributed by both public companies and nominating shareholders in contested director elections to include both sides’ director nominees, such that shareholders casting their vote can “mix-and-match" nominees from each of the company’s and the dissident’s slate of director nominees.
Update on Changes in SEC Commissioners
On July 18, 2022, the Securities and Exchange Commission (“SEC”) announced that Jaime Lizárraga was sworn in as the SEC’s newest Commissioner following the departure of Allison Herren Lee on July 15. The current SEC Commissioners are as follows, in order of reverse seniority:
Now Available: SEC Desktop Calendar for 2023
To continue assisting US companies with planning for SEC reporting and capital markets transactions into 2023, we offer our annual SEC Desktop Calendar. This calendar provides both the filing deadlines for key SEC reports and the dates on which financial statements in prospectuses and proxy statements must be updated before use (a/k/a financial staleness deadlines).
SEC Division of Corporation Finance Issues Interpretations Addressed to SPACs’ Business Combinations
On March 22, 2022, the staff of the Division of Corporation Finance (the “Staff”) of the Securities and Exchange Commission (the “Commission”) issued new Compliance and Disclosure Interpretations (“C&DIs”) that primarily focus on filing and disclosure issues that arise in the context of merger transactions by special purpose acquisition companies (“SPACs”).
Long-Awaited SEC Rule Proposal on Climate Change Disclosure
Overview
On March 21, 2022, the Securities and Exchange Commission approved a rule proposal for new climate change disclosure requirements for both U.S. public companies and foreign private issuers.
SEC Proposes Rules on Cybersecurity Disclosure
On March 9, 2022, the Securities and Exchange Commission (“SEC” or “Commission”) held a virtual open meeting where it considered a rule proposal for new cybersecurity disclosure requirements for public companies, primarily consisting of: (i) current reporting of material cybersecurity incidents and (ii) periodic reporting of material updates to cybersecurity incidents, the company’s cybersecurity risk management, strategy, and governance practices, and the board of directors’ cybersecurity expertise, if any.
SEC Proposes Rule to Amend Beneficial Ownership Reporting
On February 10, 2022, the Securities and Exchange Commission (the “Commission”) announced a proposed rule to modernize the rules governing beneficial ownership reporting