Recently, the SEC adopted rules requiring enhanced and additional disclosure in proxy statements, annual reports, registration statements, and other reports.  The amendments will require registrants to make new or revised disclosures regarding the following, among other matters:

• Compensation policies and practices that present material risks to the company - Reporting companies, other than smaller reporting companies, must discuss their compensation policies and practices for all employees to the extent that risks arising from such compensation policies and practices are reasonably likely to have a material adverse effect on the registrant.
• Grants of stock and option awards to executive officers and directors - Disclosure regarding stock and option awards in the Summary Compensation Table and Director Compensation Table now must be based on the aggregate grant date fair value of the awards computed under FASB Accounting Standards Codification Topic 718, Compensation – Stock Compensation. This replaces currently mandated disclosure of the annual expense of such equity awards for financial statement purposes.
• Director and nominee qualifications and legal proceedings - For each director and nominee, the companies must disclose, among other matters, the particular experience, qualifications, attributes or skills that led the board to conclude that the person should serve as a director.
• Board leadership structure – The new rules require a company to include disclosure of its board's leadership structure and the reasoning behind that structure.
• The board's role in managing risk - Companies must describe how the board of directors oversees risk management—for example, whether through a review by the entire board or a committee of the board.
• Potential conflicts of interest of compensation consultants who advise companies and their boards of directors - The new rules require additional information about compensation consultants’ fees and conflicts of interest.

Release No. 33-9089
The rule amendments generally will be effective for all proxy statements and annual reports filed, and for registration statements declared effective, on or after February 28, 2010.  Boards of directors and their compensation and nominating committees are encouraged to become familiar with the new rules.

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