Fresh start for a new year – I am moving on effective January 1st to be editor of TheCorporateCounsel.net. So this blog will move over to that site on that date – and i will endeavor to include more practical information than i have provided in the past.
If you would like to contact me – firstname.lastname@example.org or 703.237.9222.
This morning, the SEC proposed rules that would mandate electronic EDGAR filing for all Section 16 reports. It also would require companies to post their Section 16 reports on their web sites (and links to the reports as filed would satisfy this requirement).
At this point, the SEC is vague about when this proposal would be adopted – but it is shooting for Spring 2003 – which is before the Sarbanes-Oxley deadline of July 30th. The SEC envisions a “filer friendly” Web template system – although it will give the specs to third parties in the hope that they will develop even a friendlier system.
As proposed, the SEC’s Web template system would allow exhibits to be attached – however, the only exhibit likely would be a power of attorney as the SEC will encourage more important information to be included in the “footnote” section.
Next Wednesday, the SEC is holding an open meeting to consider mandating electronic filing of all Section 16 reports. Despite SEC encouragement, most companies still file their reports in paper – despite the tight new 2 day deadline. See the SEC’s open meeting announcement at http://www.sec.gov/news/digest/12-12.txt.
Yesterday, on appeal, the Commission reversed the SEC staff’s mid-July position taken in a no-action letter allowing National Semiconductor Corporation to exclude a shareholder proposal regarding the board establishing a policy and practice of expensing the costs of future stock options issued to executives (2002 SEC No-Act. Lexis 651 (July 19, 2002)). The staff’s response had indicated that this proposal was excludable as “ordinary business” under Rule 14a-8(i)(7) – because it was a “choice of accounting methods.” This staff response was consistent with six other requests filed during the past year.
Below the relevant paragraph from the SEC’s appeal letter:
“After further consideration of the issues by the Division, as directed by the Commission, the Division does not concur in National Semiconductor’s view that the United Brotherhood of Carpenters Pension Fund’s proposal relates to ordinary business matters and, in the future, we will not treat shareholder proposals requesting the expensing of stock options as relating to ordinary business matters. The Division notes, however, that National Semiconductor relied in good faith on the Division’s position with respect to the proxy materials in connection with its 2002 annual meeting of shareholders, which was held on October 18, 2002.” National Semiconductor (Recon.) (avail. Dec. 6, 2002).
As a result of the overturn on appeal, over a hundred proposals recently submitted to companies on option expensing will have to be placed on the ballot for a shareholder vote. See more @ the original staff position at http://www.realcorporatelawyer.com/Ezine/EZineOctober2002.htm#StockOptions
It has been reported that William Donaldson, co-founder of Donaldson Lufkin & Jenrettre and former Chairman and CEO of
the NYSE will be named Chairman of the SEC later today…more to come…
The SEC is holding roundtables on auditor independence and attorney responsibility standards on 12/17 in Washington DC – both will be webcast. See http://www.sec.gov/news/press/2002-175.htm.
ACCA is hosting a webcast program on attorney responsiblity standards on Wednesday, December 11th – including former SEC General Counsels David Becker and Simon Lorne – as well as current SEC Deputy General Counsel Meyer Eisenberg. Information is not yet posted on www.acca.com regarding the program – but should be posted on Monday.
The SEC has posted its proposing release on the auditor independence rules at http://www.sec.gov/rules/proposed/33-8154.htm.