Earlier this week, the Board of the Financial Accounting Foundation (FAF) named Hillary H. Salo as the next chair of the Financial Accounting Standards Board (FASB), the organization that establishes financial accounting and reporting standards for companies that follow GAAP (and is recognized by the SEC as the designated accounting standards setter for public companies). Succeeding Richard R. Jones, whose term concludes June 30, 2027, her term as chair will begin July 1, 2027, and conclude June 30, 2034. The announcement notes that Ms. Salo is a former KPMG Partner and currently serves as vice chair of the FASB and chair of the Emerging Issues Task Force.
Throughout her career, Ms. Salo has advanced high-quality financial reporting through roles as a standard setter, audit partner, regulator, and advisor. Since rejoining the FASB as technical director in 2020, she has played a central role in shaping and advancing the Board’s priorities and strengthening its engagement with stakeholders. Previously, she was an audit partner at KPMG LLP and held roles in the firm’s audit quality and professional practice and accounting advisory services groups.
Ms. Salo also served as a professional accounting fellow in the Office of the Chief Accountant at the U.S. Securities and Exchange Commission (SEC). She began her career as a FASB post-graduate technical assistant after graduating with an undergraduate degree in business administration and a master’s degree in accountancy from the University of North Carolina at Chapel Hill.
At the same time, the Board of Trustees issued a call for nominations to fill the FASB member vacancy created by Ms. Salo’s appointment and noted that it is continuing its search for a FASB member to fill the vacancy that will be created by the expiration of Marsha Hunt’s second term on June 30, 2027.
I might as well continue on the themes of digital assets and accounting because – look! – there’s more! On Tuesday, the FASB announced that it published a proposed ASU (Accounting Standards Update) that would clarify how the definition of ‘cash equivalents’ applies to stablecoins and certain other digital assets.
During the 2025 FASB agenda consultation project and through other feedback, stakeholders noted uncertainty about whether certain digital assets, including stablecoins, meet the definition of cash equivalents under current generally accepted accounting principles (GAAP). That uncertainty has led to diversity in practice.
To address that stakeholder feedback, the proposed ASU would provide illustrative examples to promote more consistent application of that definition and improve comparability among entities that elect to present qualifying digital assets as cash equivalents.
This is just clarifying guidance for entities that hold these digital assets; the proposal does not change the definition of ‘cash equivalents.’
That said, the relevance of this proposed ASU isn’t limited to organizations that hold digital assets. It also proposes expanding the disclosure requirements for cash equivalents more generally. Those requirements are not limited to digital assets, and they apply to all entities that present assets as cash equivalents, regardless of whether they are digital assets.
The SEC’s EDGAR Business Office distributed some helpful reminders on Friday:
Don’t Forget Annual Confirmation!
Ensure your annual confirmation is completed on time on the EDGAR Filer Management website. Annual confirmation is due at the end of the quarter selected by the filer as an ongoing confirmation deadline.
Protect Your PII
Before you hit submit, make sure you double-check the filer information, filings, and attachments to ensure you’re not inadvertently including sensitive personally identifiable information (PII) in your EDGAR submissions.
Have Questions? How Do I Guides Have Answers
Review user-friendly How Do I Guides that provide information about EDGAR, including how to request access, prepare and submit filings, and more.
EDGAR News & Announcements
Keep up with the latest EDGAR-related announcements, including important system changes. Sign up to receive email updates. Check for any EDGAR system status issues posted at the top of the announcements webpage.
Insiders and those who help manage their EDGAR filings should particularly note the reminder about the annual confirmation, which, as discussed in more detail in the December 2025 issue of Section 16 Updates, is a new housekeeping item under EDGAR Next, because some of the timing issues are not intuitive and failure to comply would eventually result in the insider having to submit a new Form ID.
In addition to receiving timely updates via the Section16.net members-only blog, Section16.net members have access to an ongoing Q&A Forum (with over 11,000 entries!) and online versions of Romeo & Dye’s Section 16 Treatise and Reporting Guide and Alan Dye’s Section 16 Forms and Filings Handbook. Website membership also gives you access to the annual webcast on Section 16 developments. Not a member? We can fix that. Contact us today at info@ccrcorp.com or call 800.737.1271 to sign up for a no-risk trial.
After announcing and canceling an open meeting last week to consider whether to issue a release proposing new rules to create a tailored offering regime for certain investment contracts involving crypto assets, the SEC announced yesterday that it approved, without an open meeting, a rule proposal titled ‘Regulation Crypto Assets.’ Here’s the 402-page rule release and the 3-page fact sheet. Commissioners Peirce and Uyeda issued statements in support of the proposal, as did Chairman Atkins, who provided a succinct explanation of the proposed rules in his statement:
Today’s proposal would create a fit-for-purpose framework—consistent with the Commission’s recent interpretation—for non-security crypto assets that are subject to an investment contract. Specifically, the proposed rules include tailored offering exemptions, as well as a safe harbor that would provide clarity for issuers, investors and other market participants as to when the related investment contract ceases to exist. Of course, the proposed rules include certain conditions that preserve core investor protections.
The proposed rules include two offering exemptions tailored for innovations in the crypto asset markets: a “startup exemption,” which would allow for offerings up to $5 million during a four-year period, and a “fundraising exemption” allowing for offerings of up to $75 million each year.
Each proposed exemption includes principles-based disclosure requirements tailored to the unique aspects of crypto assets. The proposed fundraising exemption also requires disclosures regarding an issuer’s financial condition, including financial statements that must be audited at certain capital raising thresholds.
Additionally, the proposed rules include an “investment contract safe harbor.” Under this safe harbor, if the issuer certifies to the Commission that it has ceased or terminated all essential managerial efforts that it promised to undertake under the investment contract and satisfies certain other conditions, then the Commission would no longer deem the non-security crypto asset to be subject to an investment contract and, therefore, no longer subject to the authority of the Commission.
The proposal also would preempt state registration and qualification requirements for offers and sales of covered investment contracts pursuant to one of the exemptions contemplated by Regulation Crypto Assets and for certain secondary market transactions. The fact sheet and press release also make clear that proposed Regulation Crypto Assets builds on and complements the SEC’s interpretive guidance issued earlier this year regarding what digital assets are, and are not, securities.
There was some speculation online that the cancellation of the open meeting last week had to do with the status of the CLARITY Act. Chairman Atkins and Commissioner Uyeda both addressed the potential for (and welcomed!) crypto legislation in their statements:
Chairman Atkins: “Given the progress made in Congress to date on market structure legislation, let me be clear up front: legislation remains indispensable to enacting “future-proofed” rules of the road that are durable enough to protect the work we are undertaking today from being unwound by a future rogue regulator. The SEC has and will continue to support Congress in delivering the CLARITY Act to President Trump’s desk.”
Commissioner Uyeda: “Notably, with respect to any legislative developments, nothing in the proposal precludes the Commission from taking into account such developments in formulating or responding to future crypto policies. To the contrary, legislative CLARITY would be beneficial to market participants and regulatory agencies.”
Both also recognized and thanked (in addition to the Corp Fin and DERA staff) Commissioner Peirce for her leadership on crypto issues. I have to imagine it’s satisfying that this proposal was approved before she departs the SEC this fall. We all know how disappointing it feels when a big M&A deal or IPO you’ve spent countless hours on dies – or you switch jobs or go on parental leave when a deal has stalled, and you know you won’t be able to see it through to completion (if it ever closes).
Yesterday, Chairman Atkins issued a statement, on behalf of the Commission, soliciting candidates to serve on the board of the PCAOB. The statement notes:
The Act requires that PCAOB Board members be “appointed from among prominent individuals of integrity and reputation who have a demonstrated commitment to the interests of investors and the public, and an understanding of the responsibilities for and nature of the financial disclosures required of issuers under the securities laws and the obligations of accountants with respect to the preparation and issuance of audit reports with respect to such disclosures.”
Only individuals who have never been a certified public accountant are eligible to serve in this seat, which is for a term ending on October 24, 2031. I strongly encourage applications from candidates interested in furthering the public interest through the efficient stewardship of PCAOB resources. Board members play an important role in serving the public interest by helping to protect the integrity of public markets in a manner that minimizes unnecessary costs for the public companies, brokers, and dealers who ultimately fund the PCAOB’s budget.
The statement notes that the PCAOB Board member selection process is administered by the SEC’s Office of the Chief Accountant. Submissions should be emailed to the SEC and the deadline for submissions is September 8, 2026.
Check out John’s latest “Timely Takes” Podcast featuring Cleary’s J.T. Ho sharing his monthly update on securities & governance developments. This month, their 24-minute podcast addresses the following topics:
SEC Proposes Regulation E-Delivery
SEC Releases 2026 Rulemaking Agenda
Recent SEC Guidance
Activism Trends at the 2026 Midpoint
Nasdaq 3rd Annual Global Governance Pulse Survey
As always, if you have insights on a securities law, capital markets or corporate governance issue, trend or development that you’d like to share in a podcast, we’d love to hear from you. You can email me at mervine@ccrcorp.com and/or John at john@thecorporatecounsel.net.
On Friday, the SEC posted notices and orders to solicit comments and approve, on an accelerated basis, proposed rule change filings (as amended) by NYSE and NYSE American regarding the exchanges’ stock price continued listing standards. The rule changes by NYSE and NYSE American would codify and increase the closing price at which they will take immediate delisting action.
Currently, regardless of where an issuer stands in its six-month price criteria cure period, NYSE will promptly initiate suspension and delisting procedures if a stock trades below $0.10 per share. Due to recent increases in trading of companies that have a very low trading price per share and concerns over manipulative trading activity, NYSE’s proposal would amend Section 802.01C of the Listed Company Manual to specify that if a closing price per share is less than $0.25 on any trading day, the exchange will immediately suspend trading and commence delisting proceedings. This change will not be effective until July 1, 2027, to allow listed companies time to implement reverse splits before the rule change takes effect. The amendments would also specify that NYSE’s general authority to suspend trading in the event of any condition that “makes further dealings on the Exchange unwarranted” includes the authority to suspend trading or delist a security where it believes the trading price has experienced a “precipitous decline and is at an abnormally low level from which it is unlikely to recover,” even when the closing price has not fallen below $0.25.
In the NYSE American order, the exchange proposes to amend Section 1003 of the NYSE American Company Guide to reflect similar changes. Both of these rule changes are part of a broader effort by both NYSE and Nasdaq to tighten listing standards. Some significant changes have impacted NYSE American specifically this year, with this order following a March approval of a proposal, after amendment, that made multiple NYSE American initial listing standards more rigorous.
Last week, the SEC posted an order approving proposed rule changes to amend DTC’s Redemptions Service Guide and Operational Arrangements to update its Payment without Presentation process, which, the order explains, “permits Agents to remit maturity or full call proceeds to DTC without requiring delivery of the associated physical certificate and allows them to rely instead on DTC’s book-entry records of entitlements.” This is a technical rule change, but I found there were times in practice when I needed at least a cursory understanding of how DTC processes work. Here’s how the order explains the old process and the new process:
Under the current procedure for redeeming a debt security at maturity, DTC submits a physical debt certificate and a Letter of Transmittal (“LT”) to the Agent prior to the release of redemption proceeds from the Agent to DTC. After receiving both documents, the Agent releases the funds, and DTC then distributes the funds to Participants and deletes the Participants’ positions from DTC’s records. Alternatively, Paying Agents and Issuers currently utilizing DTC’s Redemption PWP process for Fast Automated Securities Transfer (“FAST”) and Book-Entry-Only (“BEO”) issues agree to accept DTC’s automated notifications instead of physical Shipment Control List and Redemption Payment Summary forms for redemption payments. The Agent and Issuer must agree to review relevant details prior to the redemption date and report any discrepancies at the CUSIP level prior to payment. Redemption payments are then remitted to DTC in accordance with the procedures described in the OA.
The Proposed Rule Change seeks to amend the Redemptions Guide and the OA to update the PWP process. The Proposed Rule Change would: (i) eliminate the need for a LT or the presentment of certain other physical documents; (ii) include in the Rules that Agents may receive automated notifications; (iii) make participation in the PWP process mandatory, with optout permitted only where necessary; (iv) establish retention and destruction protocols for physical certificates; and (v) make clarifying and conforming changes.
With respect to items (i), (ii) and (iv) above, the Proposed Rule Change would no longer require a physical certificate presentment or related physical documentation for eligible redemption and maturity events. Agents may continue to receive automated notifications that provide information on the relevant security (including CUSIP), payment date, and amount due. These notifications would be sent electronically to Agents prior to the event. An agent must optin to receive these notifications and does so by sending an email to the redemptions operations team.
Physical certificates related to these events would no longer be delivered to Agents. Agents would remit proceeds to DTC without receipt of a LT or other physical certificates, then DTC would allocate redemption proceeds to Participants based on its book-entry records and remove any positions from its records following payment. The associated physical certificates would be segregated and imaged for record retention purposes, retained for at least ninety days following redemption, and then destroyed according to DTC’s procedures.
With respect to item (iii) above, participation in the PWP process would be mandatory for all eligible fully registered debt securities represented by physical certificates held at DTC and registered under the name Cede & Co. Exceptions to participation are permitted solely to comply with a state statute, court order, or other legal or regulatory obligation, or if the Agent is a governmental entity or authorized representative requiring physical documentation.
As I recently shared on DealLawyers.com, the Chancery Court’s recent decision in Drakes Landing Associates v. Tilden Park Capital Management(Del. Ch.; 7/26) answered a significant issue of first impression — whether Revlon applies to the board of a public benefit corporation navigating a change-of-control transaction. The decision summarizes the facts as follows:
Two of a public benefit corporation’s lenders proposed a financing transaction that would provide the company with $20 million in urgently needed financing. As part of the financing, the debt owed by the company to the two lenders would convert into equity, increasing the lenders’ stock holdings from around 25% to nearly 85%, and diluting the other stockholders. The public benefit corporation appointed an independent and disinterested special committee to evaluate the transaction. The special committee in turn retained independent legal and financial advisors and ultimately approved the deal.
The parties agreed that the financing was a change-of-control transaction to which Revlon would apply if the company was not a PBC, but disagreed on whether and how a company’s status as a PBC impacts Revlon‘s application. VC Cook said that this turned on whether Revlon is treated as imposing a standard of conduct (obtain the best price reasonably available) or a standard of review (enhanced scrutiny). A Richards Layton & Finger alert on the decision explains his analysis:
The Court held that the traditional Revlon obligation to seek the best price reasonably available for stockholders does not apply as a standard of conduct to PBC directors because, under Section 365(a) of the Delaware General Corporation Law (the “DGCL”), PBC directors are required to balance stockholders’ pecuniary interests, the interests of persons materially affected by the PBC’s conduct and the public benefits stated in the PBC’s certificate of incorporation. The Court explained that Revlon’s price-maximization mandate conflicts with Section 365(a)’s express balancing requirement, and that PBC directors cannot be required to pursue the highest value reasonably available for stockholders to the exclusion of the corporation’s public-benefit purpose and affected stakeholders. The Court nevertheless left open whether a modified form of enhanced scrutiny—referred to by the Court as “PBC enhanced scrutiny”—could apply to a change-of-control transaction involving a PBC as a standard of review, under which the Court would examine whether the directors’ balancing of these interests fell outside the range of reasonableness.
The Court did not directly decide this question because it found that the challenged transaction, which was approved by an independent special committee, invoked the statutory protections applicable to decisions of PBC directors under Section 365(b) of the DGCL. Section 365(b) provides, in relevant part, that with respect to director decisions implicating Section 365(a)’s balancing requirement, a director “will be deemed to satisfy such director’s fiduciary duties to stockholders and the corporation if such director’s decision is both informed and disinterested and not such that no person of ordinary, sound judgment would approve.” Because the plaintiffs conceded that the special committee members were disinterested and independent, and their allegations regarding the adequacy of the committee’s market check expressed concerns only about stockholders’ pecuniary interests without challenging the committee’s consideration of the other interests implicated by the statutory balancing test, the Court dismissed the plaintiffs’ fiduciary duty and related aiding and abetting claims. The Court also suggested that even if the corporation were not a PBC, the fiduciary duty claims would have been dismissed under Delaware’s new statutory safe harbor, Section 144 of the DGCL.
RLF says the key takeaways are that:
– PBCs are never subject to a “singular obligation to maximize stockholder value.”
– Section 365(b) of the DGCL serves as a “statutory business judgment rule” that provides significant protection against challenges to the decisions of PBC directors.
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The Corp Fin Staff’s November 2025 announcement that it didn’t intend to referee the Rule 14a-8 process during the 2026 proxy season was explicit that the process change applied to the 2026 proxy season (October 1, 2025 – September 30, 2026) and no-action requests received before October 1 that had not yet been addressed by the Staff. But, given commentary from Chairman Atkins and Staff statements, it probably comes as no surprise to any readers of this blog that the Corp Fin Staff announced on Friday that it has no intention of getting back into the game.
Chairman Atkins previously likened this process change to “removing the training wheels from the shareholder proposal bicycle.” With this most recent announcement, it seems we were all riding a balance bike during the 2026 proxy season and now we’re graduating to the 10-speed. That’s because this announcement goes a bit further.
[T]he Division has determined to discontinue responding to Rule 14a-8 no-action requests entirely, including those submitted under Rule 14a-8(i)(1), effective immediately, unless and until the Division announces otherwise.
It also will no longer respond to notices filed under Rule 14a-8(j) with a letter indicating that it will not object if a company omits a proposal from its proxy materials. Although the staff “has for many years engaged in the informal practice of expressing its enforcement position” in response to notices submitted under Rule 14a-8(j), the Commission has also long recognized that “[n]o response or other action by the Commission or its staff is required in regard to such communications.”
Not only does it go further, but, as Broc noted in this Cooley blog, unlike the November 2025 announcement, “There is no sunset for these updated Staff positions – unless the SEC announces a change in its position. So this is ‘new normal’ for the foreseeable future…”
As required by the rule, the announcement reminds companies that they must still submit notices under Rule 14a-8(j) containing the information required, which they should do using the Shareholder Proposal Form. That form will also be used for any questions or other correspondence that companies or proponents submit to the Staff. The Corp Fin shareholder proposal email address has been deactivated. Investment Management will take a similar approach for Rule 14a-8 notices by investment companies, except Rule 14a-8(j) notices will be submitted via email to IMshareholderproposals@sec.gov.
