September 26, 2012

In the last two days, both the NYSE and Nasdaq have issued proposed rules on the independence of compensation committees and their advisers, as required by Dodd-Frank Act Section 952 and the SEC’s final rule from June 2012. As we expected, the proposed rules make no major changes to the SEC’s final rule. I will write tomorrow or over the weekend on the interesting minor changes made by the proposals (especially Nasdaq).

NYSE: http://www.nyse.com/nysenotices/nyse/rule-filings/pdf;jsessionid=474035BE3B197D71B5150C5D1911BB0F?file_no=SR-NYSE-2012-49&%20seqnum=1

Nasdaq: http://nasdaq.cchwallstreet.com/NASDAQ/pdf/nasdaq-filings/2012/SR-NASDAQ-2012-109.pdf

The NYSE is proposing to make the changes to its listing standards effective on July 1, 2013. NYSE listed companies would have until the earlier of their first annual meeting after January 15, 2014, or October 31, 2014, to comply with the new independence standards for compensation committee members and the requirement to assess the independence of committee advisers (compensation consultants, legal advisers, and other advisers).

Nasdaq proposes that Rule 5605(d)(3), which requires that a compensation committee have the (i) authority to retain compensation consultants, independent legal counsel and other compensation advisers; (ii) authority to fund such advisers; and (iii) responsibility to consider certain independence factors before selecting such advisers, other than in-house legal counsel, is effective immediately. Nasdaq companies must comply with the remaining provisions of the amended listing rules by the earlier of: (1) their second annual meeting held after the date of approval of this proposal; or (2) December 31, 2014.

On September 26, 1918, Colonel George S. Patton, Jr. was wounded (bullet entering the upper thigh and exiting from behind) leading the 344th and 345th battalions of the United States Tank Corps in the Meuse-Argonne Offensive, also called the Battle of the Argonne Forest, part of the final Allied offensive of World War I that stretched along the entire western front.