TheCorporateCounsel.net

April 11, 2011

Five More of Corp Fin’s Dodd-Frank Rulemakings Delayed

In its “Implementation of Dodd-Frank Act” rulemaking timeline, on Friday, the SEC pushed back its estimate of when it will push out proposed rules from April-July to August-December for the following topics that relate to Corp Fin:

– §952: Adopt exchange listing standards regarding compensation committee independence and factors affecting compensation adviser independence; adopt disclosure rules regarding compensation consultant conflicts
– §975: Adopt permanent rules for the registration of municipal advisors
– §1502: Adopt rules regarding disclosure related to “conflict minerals”
– §1503: Adopt rules regarding disclosure of mine safety information
– §1504: Adopt rules regarding disclosure by resource extraction issuers

The above topics join these four that had already pushed back to August-December a few months ago (as I blogged previously):

– Pay-for-performance disclosure (how compensation is related to financial performance; Section 953)
– Pay ratios (ratio of CEO pay to average employee pay; Section 954)
– Clawback policies (clawback of the compensation of current and former officers upon restatement; Section 954)
– Hedging policies (whether company has a policy regarding the ability of directors and employees to hedge; Section 955)

I don’t think these delays were caused by the threat of a government shutdown, although I imagine that certainly didn’t help. Note that about a dozen other rulemakings were pushed back that are not Corp Fin-centric. Hat tip to Davis Polk for tracking which rulemakings were delayed, not an easy task.

It also looks like there could be a delay in the implementation of Dodd-Frank’s investment adviser registration framework as reflected in this letter from the SEC’s Division of Investment Management to the President of NASAA. The letter anticipates that the SEC will have its new Advisers Act rules in place by the July 21st deadline – but that the SEC will consider extending the date by which advisers will be required to comply with the new rules to the first quarter of 2012 (particularly due to the need to reprogram the IARD to accept transition filings).

Say-on-Pay: A Sixth Failed Vote

Last week, Ameron International filed a Form 8-K to reveal it has become the sixth company to fail to receive majority support for its say-on-pay, with 42% voting in favor. As noted in this LA Business Journal article, the company also was the subject of a proxy fight. As I blogged earlier, I’m counting Hemispherx Biopharma as the 5th failed vote until someone convinces me otherwise (here is our list of failed votes so far)…

In his “Proxy Disclosure Blog,” Mark Borges gives us the latest say-when-on-pay stats: with 1689 companies filing their proxies, 42% triennial; 4% biennial; 51% annual; and 4% no recommendation.

More on “Shutdown: Corp Fin Will Slow to a Crawl (If Even That)”

On Friday, I blogged about the SEC’s statement about how limited its operations will be during the government shutdown. I also posted a poll allowing you to guess how many Corp Fin Staff would be working during the shutdown (guess came out to: 10% for “less than 3″; 33% for “4-10″; 24% for “11-20″; 16% for “20-50″; and 1% for “more than 50.” I believe the “4-10″ folks would have been closest to the mark).

On Friday, before the shutdown was averted, the SEC posted this contingency plan that provided more details regarding the lapse in operations compared to its statement that was posted on Thursday. In addition, a group of law firms issued this “10 Law Firm Consensus Report” that contains 12 FAQs regarding the impact of the shutdown on the SEC. And even more comprehensive is this podcast from Dave Lynn and Marty Dunn (which also was taped before the shutdown was averted) that addresses:

– Processing of filings during a shutdown
– Continuing filing obligations and counting business days
– Availability of no-action and interpretive advice
– Dealing with preliminary proxy statements

As noted in the SEC’s contingency plan, the rationale for federal employees not being permitted to work during a shutdown is a 19th-century law known as the Anti-Deficiency Act. I wonder if reading this blog would be considered “work” under that statute…

– Broc Romanek