On May 11, 2018, the Securities and Exchange Commission's Division of Corporate Finance (the "Division") released new Compliance and Disclosure Interpretations ("C&DIs") comprising the Division's new interpretations of the proxy rules and Schedules 14A and 14C. The new C&DIs replace interpretations previously published in the Division's Proxy Rules and Schedule 14A Manual of Publicly Available Telephone Interpretations and the Division's March 1999 Supplement to the Manual of Publicly Available Telephone Interpretations ("Telephone Interpretations").
Of interest for equity compensation matters is C&DI 161.03, which clarifies disclosure obligations in the New Plan Benefits Table that is required in a proxy statement pursuant to Item 10(a)(2) of Schedule 14A when shareholders are being asked to approve the adoption or material amendment of an equity plan. Previously, telephone interpretation guidance provided that when the New Plan Benefits Table is required in a proxy statement, even if an amount of "0" will be entered in the table, all of the individuals and groups for which award or benefit information is required should be listed in the table. New C&DI 161.03 updates this guidance in providing an alternative method of satisfying the Item 10(a)(2) requirement for individuals and groups for which award and benefit information to be reported is "0" through a narrative disclosure accompanying the New Plan Benefits Table, rather than in the New Plan Benefits Table itself. While such individuals and groups must still be reported, this C&DI provides some flexibility in the manner of reporting.
The Division noted that some of the new C&DIs reflect "substantive" changes to the previously available Telephone Interpretations, some reflect "technical revisions," and the remaining reflect only non-substantive changes. The following table includes each of the new C&DIs identified by the Division as containing substantive or technical changes, together with the previously available Telephone Interpretation guidance that has now been superseded.
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