The Sec’s Compensation Disclosure Reforms: 8-K Disclosure Requirements

On July 26, 2006, in response to calls for extensive reform of the disclosure rules governing compensation of executive officers of public companies, the Securities and Exchange Commission (SEC) voted to adopt comprehensive changes to the rules requiring disclosure in proxy statements and registration statements of executive and director compensation and other corporate governance matters.¹ In this release, the SEC also modified the requirements for disclosing executive and director compensation arrangements in Current Reports on Form 8-K. Companies must comply with the revised disclosure requirements in their Forms 8-K for triggering events that occur on or after November 7, 2006.

This Client Advisory provides a brief summary of the amendments to Form 8-K and practical guidance for complying with the new disclosure requirements.