SEC Proposed Rules for Hedging Disclosure Published in Federal Register

The SEC-proposed rules to require an issuer to disclose whether it permits directors and employees to hedge their exposure to the company's securities that they own or that are granted to them as compensation were published in the Federal Register.

The proposal amends Regulation S-K to require annual proxy disclosures about whether directors and employees are permitted to hedge or offset any decrease in the market value of equity securities granted by a company as compensation or otherwise held by them, as well as the equity securities of their employer's parent, any subsidiary of the company or any affiliate of the company that is registered under Exchange Act Section 12. The disclosures apply to companies subject to the federal proxy rules, including smaller reporting companies, emerging growth companies, business development companies and registered closed-end investment companies with shares listed and registered on a national securities exchange.

Comments on the proposal must be submitted by April 20, 2015.

See: 80 FR 8486.Related news: SEC Proposes Rules for Hedging Disclosure (with Lofchie Comment) (February 9, 2015).