Jan 12, 2015
From the Financial Reporting View
The SEC recently proposed amendments to revise the rules related to the thresholds for registrations, termination of registration, and suspension of reporting under Section 12(g) of the Exchange Act. The proposal also would amend the definition of held of record to provide that, when determining whether it is required to register a class of equity securities under the Exchange Act Section 12(g)(1), an issuer may exclude certain securities received under an employee compensation plan and in certain circumstances may exclude securities held by persons who received them in exchange for securities received under an employee compensation plan.
The SEC also proposed to apply the definition of accredited investor in Securities Act Rule 501(a) to determinations as to which record holders are accredited investors for purposes of Exchange Act Section 12(g)(1). This determination would be made as of the last day of the fiscal year. Further, the proposal included a non-exclusive safe harbor under which a person will be deemed to have received the securities under an employee compensation plan if the person received them under a compensatory benefit plan in a transaction that met the conditions of Securities Act Rule 701(c).
The comment period ends February 16.