O usuário reconhece que revisou o Contrato de Usuário e a Política de Privacidade que regem este site e que o uso continuado constitui a aceitação dos termos e condições nele estabelecidos. Características Riscos do amplificador de opções padronizadas Antes de comprar ou vender uma opção, os investidores devem ler uma cópia do Risco de características das opções padronizadas, também conhecido como documento de divulgação de opções (ODD). Explica as características e os riscos das opções cambiais negociadas. As cópias deste documento também podem ser obtidas junto ao seu corretor, de qualquer troca em que as opções são negociadas, fazendo um pedido on-line. Ou contatando a Corporação de compensação de opções diretamente em 1 N. Wacker Dr. Suite 500, Chicago, IL 60606. Tendo problemas para visualizar o ODD Recomendamos baixar e instalar a versão mais recente do Adobe Acrobat Reader. Que está disponível como download gratuito. Se os seus problemas persistirem, você pode querer solicitar uma versão impressa ou entrar em contato com seu corretor. Solicitar versão impressa Clique aqui para fazer um pedido para a versão impressa do Documento de divulgação de opções. O ODD é apenas 0,45 mais o transporte e o manuseio. Aguarde 8-10 dias para entrega. Este site discute opções negociadas em bolsa emitidas pela The Options Clearing Corporation. Nenhuma declaração neste site deve ser interpretada como uma recomendação para comprar ou vender uma garantia, ou para fornecer conselhos de investimento. As opções envolvem riscos e não são adequadas para todos os investidores. Antes de comprar ou vender uma opção, uma pessoa deve receber uma cópia das Características e Riscos das Opções Padronizadas. Podem ser obtidas cópias deste documento do seu corretor, de qualquer troca sobre as opções negociadas ou contatando The Options Clearing Corporation, One North Wacker Dr. Suite 500, Chicago, IL 60606 (investmentervicestheocc). 169 2017 The Options Clearing Corporation. Todos os direitos reservados. Prêmios de opções de ações do CEO e o momento das divulgações voluntárias corporativas David Aboody a, Ron Kasznik b. . Uma escola de graduação de Anderson, Universidade da Califórnia em Los Angeles, Los Angeles, CA 90095-1481, EUA b Graduate School of Business, Stanford University, Stanford, CA 94305-5015, EUA Recebida 3 de dezembro de 1998, revisada em 22 de maio de 2000, Disponível on-line 9 de outubro de 2000Nós investigamos se os CEOs gerenciam o momento de suas divulgações voluntárias em torno de prêmios de opções de ações. Conjeturamos que os CEOs gerenciam as expectativas do investidor sobre as datas de adjudicação, atrasando as boas notícias e acelerando a má notícia. Para uma amostra de 2.039 prêmios de opções de CEOs por 572 empresas com horários de prêmio fixos, documentamos mudanças nos preços de ações e nas previsões de lucros dos analistas em torno de prêmios de opção que são consistentes com nossa conjectura. Nós também fornecemos evidências mais diretas com base nas previsões de ganhos gerenciais emitidas antes das datas de adjudicação. Nossas descobertas sugerem que os CEOs tomem decisões oportunistas de divulgação voluntária que maximizem sua compensação de opção de estoque. Classificação de JEL Requisitos de opção de ações de CEO Divulgação voluntária Agradecemos os comentários e sugestões úteis dos participantes da oficina no 1998 Stanford Accounting Summer Camp, 1999 DukeUNC Fall Camp, 1999 American Accounting Association reunião anual, Universidade do Arizona, Arizona State University, Universidade da Colúmbia Britânica Universidade da Califórnia em Los Angeles, Universidade de Columbia, Universidade Estadual da Georgia, Universidade de Michigan, Universidade de Nova York, Northwestern University, Universidade de Purdue, Universidade de Rochester, Universidade do Texas em Austin, Universidade de Washington e Universidade de Washington, Kevin Murphy ( O árbitro), e Jerry Zimmerman (o editor). Também agradecemos o apoio à pesquisa da Hung-Ken Chien. David Aboody reconhece o apoio da Anderson School na UCLA. Ron Kasznik reconhece o apoio da Iniciativa de Pesquisa Financeira, Graduate School of Business, Universidade de Stanford. Autor correspondente. Tel. 1-650-725-9740 fax: 1-650-725-6152 Copyright copy 2000 Elsevier Science BV Todos os direitos reservados. Regra final: Divulgação de informações sobre o plano de remuneração de ações COMISSÃO DE VALORES MOBILIÁRIOS E DEMONSTRAÇÃO DE VALORES MOBILIÁRIOS 17 CFR Partes 228, 229, 240 e 249 Release Nos. 33-8048, 34-45189 Arquivo No. S7-04-01 DIVULGAÇÃO DE INFORMAÇÕES SOBRE O PLANO DE COMPENSAÇÃO DE PATRIMÔNIO Agência: Comissão de Valores Mobiliários. Ação: regras finais. Resumo: Estamos adotando alterações aos requisitos de divulgação do Securities Exchange Act de 1934 aplicáveis aos relatórios anuais arquivados nos Formulários 10-K e 10-KSB e às declarações de procuração e informações. As emendas aumentarão a divulgação do número de opções pendentes, warrants e direitos concedidos pelos inscritos aos participantes em planos de remuneração de ações, bem como a quantidade de títulos restantes disponíveis para emissão futura de acordo com esses planos. As alterações exigem que os registrantes forneçam essas informações separadamente para planos de compensação de capital que não tenham sido aprovados pelos seus detentores de títulos e que nos entreguem cópias desses planos, a menos que seja imaterial em importância. Datas: Data de vigência: 1 de fevereiro de 2002. Datas de conformidade: Os registrantes devem cumprir os novos requisitos de divulgação de relatórios anuais nos Formulários 10-K ou 10-KSB a serem arquivados para exercícios findos em 15 de março de 2002 e para Declarações de procuração e informação para reuniões ou ações de segurados que ocorram em ou após 15 de junho de 2002. Os inscritos voluntariamente podem cumprir os novos requisitos de divulgação antes das datas de conformidade. Comentários: Os comentários sobre a coleta de requisitos de informação na acepção da Lei de redução de papelada de 1995 devem ser recebidos 30 dias após a publicação no Federal Register. Para mais informações Contato: Mark A. Borges, Advogado Especial, Escritório de Regra, Divisão de Finanças Corporativas, por telefone no (202) 942-2910, ou por escrito na Securities and Exchange Commission, 450 Fifth Street NW, Washington, DC 20549. Informações complementares: estamos adotando alterações aos itens 201 1 e 601 2 do Regulamento SB, 3 Itens 201 4 e 601 5 do Regulamento SK 6 e Formulário 10-K, 7 Formulário 10-KSB 8 e Anexo 14A 9 sob os Valores Mobiliários Exchange Act de 1934. 10 O Anexo 14C 11, ao abrigo do Exchange Act, também é afetado pelas alterações. 12 I. Introdução Como o uso da compensação de capital aumentou durante a última década 13, tem preocupações quanto ao seu impacto nos registrantes e seus detentores de valores. 14 Os subsídios e prêmios de remuneração de capital podem resultar em uma reafectação significativa de propriedade entre os segurados existentes e a administração e os funcionários. 15 Nossas regras atuais não requerem divulgação em um único local do número total de valores mobiliários que um registrante permanece disponível para emissão em todos os seus planos de remuneração de capital próprio. Além disso, como esses planos podem ser implementados sem a aprovação dos detentores de títulos, é possível que os investidores não possam determinar o tamanho total de um programa de compensação de equivalentes de registrantes. Em janeiro de 2001, propusemos alterações às nossas regras de divulgação de remuneração de capital, onde nossa intenção era fornecer aos investidores uma apresentação mais compreensível de um programa de compensação de equivalência de inscritos. 16 Recebemos 31 cartas de comentários em resposta às propostas. 17 Embora a maioria dos comentaristas apoiasse as propostas, vários questionaram a necessidade de divulgação que, na sua opinião, era substancialmente equivalente à divulgação já exigida nas demonstrações financeiras auditadas dos registrantes. Além disso, muitos dos comentaristas de apoio ofereceram sugestões para refinar as propostas para alcançar melhor o objetivo de garantir que todas as informações relevantes sobre um programa de compensação de equidade de registrantes sejam totalmente e claramente divulgadas. Fazemos uma série de mudanças nas propostas em resposta a esses comentários. Essas mudanças são discutidas na Seção II desta versão. Como resultado das emendas atuais, os registrantes devem incluir uma nova tabela em seus relatórios anuais no Formulário 10-K, 18, bem como em suas declarações de procuração 19 nos anos em que eles estão apresentando um plano de compensação para a ação do titular de segurança. Esta tabela requer informações sobre duas categorias de planos de remuneração de ações: planos que foram aprovados pelos detentores de títulos e planos que não foram aprovados pelos segurados. Em relação a cada categoria, o registrante deve divulgar o número de valores mobiliários a serem emitidos no exercício e o preço de exercício médio ponderado de todas as opções pendentes, warrants e direitos, bem como o número de títulos restantes disponíveis para emissão futura Nos planos de compensação de equivalentes dos registrantes. 20 II. Discussão das Emendas A. Conteúdo da Divulgação 1. Divulgação Obrigatória De acordo com as propostas originais descritas na Proposta de Proposta, os registrantes devem divulgar em forma de tabela várias categorias de informações sobre seus planos de remuneração de ações, incluindo o número de títulos autorizados para emissão de acordo com cada plano , O número de valores mobiliários emitidos, acrescido do número de valores mobiliários a serem emitidos após o exercício de opções pendentes, warrants ou direitos concedidos, em cada plano durante o último ano fiscal, o número de valores mobiliários a serem emitidos após o exercício de opções pendentes, Warrants ou direitos concedidos que não sejam no último ano fiscal e o número de títulos restantes disponíveis para futuras emissões em cada plano. As propostas exigiriam que os inscritos listassem cada plano separadamente na tabela. Também buscamos comentários sobre se outras categorias de informações devem ser incluídas na tabela. Em resposta às preocupações de que as propostas seriam caras e onerosas para implementar e duplicar algumas das informações exigidas nas demonstrações financeiras dos registrantes, eliminamos as duas primeiras categorias propostas de divulgação. Também fizemos algumas outras mudanças, incluindo uma alteração que permite que os registrantes apresentem as informações solicitadas de forma agregada. Essas mudanças são discutidas em detalhes abaixo. Além de comentários sugerindo que reduzimos a divulgação proposta, também recebemos comentários citando a necessidade de tipos adicionais de divulgação não propostos originalmente. Por exemplo, vários comentadores sugeriram que adicionássemos uma coluna à tabela proposta que mostra o preço de exercício médio ponderado das opções, garantias e direitos pendentes. 21 Esses comentadores afirmaram que os investidores precisam dessa informação para avaliar o efeito dilutivo de um programa de compensação de equivalência de inscritos. 22 Para permitir aos investidores compreender melhor a diluição e aumentar a visibilidade da informação sobre o preço do exercício, adicionamos uma coluna à tabela que exige a divulgação do preço de exercício médio ponderado de todas as opções, garantias e direitos compensatórios pendentes. 23 Conforme adotado, as emendas exigem que um registrante forneça aos investidores a seguinte divulgação tabular: Informações sobre o Plano de Compensação Patrimonial Os inscritos devem fornecer a divulgação em relação a qualquer plano de compensação de ações 24 vigente no final do último ano fiscal concluído que Prevê a concessão de valores mobiliários de um registrante ou a concessão de opções, warrants ou direitos de compra dos valores mobiliários dos registrantes aos empregados do registrante ou suas empresas-mãe, subsidiárias ou afiliadas ou a qualquer outra pessoa. 26 A divulgação também deve ser fornecida sem considerar se os valores mobiliários a serem emitidos de acordo com o plano de remuneração de ações são autorizados, mas títulos não emitidos do registrante ou ações readquiridas. 2. Divulgação agregada Vários comentaristas sugeriram que permitimos que os registrantes forneçam a divulgação tabular necessária em uma base agregada, em vez de um plano por plano. 27 Esses comentadores indicaram que seria excessivamente onerosa para muitos inscritos se os planos tivessem que ser listados separadamente na tabela. Outro comentador expressou preocupações semelhantes se os inscritos fossem obrigados a discriminar planos assumidos como resultado de fusões, consolidações ou outras operações de aquisição. 29 Estamos persuadidos de que a divulgação do planejamento por plano pode ser onerosa para muitos inscritos. 30 Consequentemente, revisamos a tabela para permitir que os registrantes agregem a divulgação em duas categorias gerais: planos de remuneração de capital aprovados pelos segurados e planos de remuneração de ações não aprovados pelos segurados. 31 Na versão proposta, buscamos comentar se, quando um registrante está enviando um plano de compensação de ações novo ou existente para a ação do segurado, a divulgação da declaração de procuração necessária deve incluir esse plano. 32 Vários comentaristas sugeriram que ampliássemos a tabela para incluir informações sobre um plano existente sobre o qual outras ações estão sendo tomadas (por exemplo, quando um registrante está buscando a aprovação dos detentores de títulos por um aumento no número de títulos autorizados para emissão nos termos do plano). 33 Esses comentadores indicaram que, na ausência deste requisito, um registrante que altera um plano de compensação de capital existente, de outra forma, pode evitar divulgar informações sobre os títulos anteriormente autorizados para emissão nos termos do plano. Estamos convencidos de que os registrantes devem incluir essa informação na tabela. Por conseguinte, quando a ação está sendo tomada para alterar um plano de compensação de capital existente, a tabela deve incluir informações sobre os títulos anteriormente autorizados para emissão nos termos do plano, o número de títulos a serem emitidos no exercício e o exercício médio ponderado Preço, das opções pendentes, warrants e direitos anteriormente concedidos de acordo com o plano e o número de títulos restantes disponíveis para futuras emissões ao abrigo do plano. 34 Um registrante não deve incluir na tabela o número de títulos adicionais que são objeto da alteração do plano para o qual o registrante está buscando a aprovação do segurado. 3. Arranjos Individuais e Planos Assumidos Na Proposta de Projeção, buscamos comentar se a divulgação agregada dos acordos individuais de compensação de capital 35 era apropriada. Também perguntamos se a divulgação agregada deve ser permitida quando um registrante assumiu um plano de compensação de ações em conexão com uma operação de fusão, consolidação ou outra aquisição. Vários comentadores apoiaram a divulgação agregada de acordos individuais, 36 e um comentarista foi a favor da agregação da divulgação de acordos individuais com a divulgação de planos de compensação de ações. 37 Outros comentaristas preferiram permitir a divulgação agregada de planos assumidos. 38 De acordo com o conceito de divulgação agregada do plano, revisamos a tabela para permitir que os registrantes combinem informações sobre arranjos individuais 39 e planos assumidos (onde outros subsídios e prêmios podem ser feitos sob esses planos) 40 com informações sobre outros planos, tudo em A categoria de divulgação apropriada. 4. Planos Aprovados pelo Titular Não-Segurado Conforme adotado, as alterações exigem que um registrante identifique e descreva brevemente, em forma narrativa, as características materiais de cada plano de compensação de ações vigente no final do último ano fiscal concluído que foi adotado Sem a aprovação do titular da segurança. 41 Enquanto vários comentadores apoiaram esse requisito, 42 um comentarista sugeriu que permitimos que os registrantes fizessem referência cruzada à parte da divulgação requerida do SFAS 123 contendo descrições dos planos aprovados pelo não segurado para satisfazer este requisito. 43 Porque ele simplifica a conformidade e garante que os investidores tenham acesso anual a essa informação, estamos permitindo que os registrantes satisfaçam o requisito de divulgação desta maneira. 45 A referência cruzada deve identificar o plano ou planos específicos na divulgação SFAS 123 necessária que não tenha sido aprovada pelos detentores de segurança. Em vista dessa mudança, eliminamos a disposição que permitiria que um registrante preenchesse esse requisito de divulgação simplesmente identificando o arquivamento contendo uma descrição narrativa do plano nos anos seguintes à divulgação inicial. 5. Registradores estrangeiros Alguns comentaristas perguntaram sobre a aplicabilidade das propostas aos registrantes estrangeiros. Historicamente, aplicamos um padrão mais flexível para os registrantes estrangeiros do que os registrantes nacionais na área de divulgação da remuneração dos executivos. Por exemplo, os registrantes estrangeiros não precisam divulgar informações de compensação de executivos de forma individual, a menos que divulgá-lo dessa maneira de acordo com a lei do país de origem ou de outra forma. 46 Não consideramos necessário variar de nosso tratamento histórico da divulgação da remuneração dos executivos para os registrantes estrangeiros, 47 e, portanto, não ampliamos as alterações aos registrantes estrangeiros neste momento. 48 B. Relacionamento com a divulgação de contabilidade Fazemos mudanças significativas nas propostas em resposta a argumentos de vários comentaristas de que a literatura contábil atual fornece uma divulgação adequada sobre a compensação baseada em estoque. 49 Concordamos que devemos nos esforçar para minimizar a divulgação redundante de acordo com os princípios contábeis geralmente aceitos e nossas regras, sempre que possível. Consequentemente, revisamos as propostas e não exigiremos a divulgação do número de valores mobiliários autorizados para emissão em cada plano de remuneração de ações 50 e o número de títulos emitidos, acrescido do número de valores mobiliários a serem emitidos no exercício de opções pendentes, warrants ou Direitos concedidos, de acordo com cada plano durante o último ano fiscal. 51 O quadro revisado fornecerá informações úteis aos investidores que nem sempre estão disponíveis nas demonstrações financeiras de um registrante. 52 Isso inclui uma indicação de se um plano de compensação de capital foi aprovado pelos detentores de títulos 53 o número total de valores mobiliários disponíveis para emissão futura no âmbito de um programa de remuneração de ações de registrantes 54 e o número de opções e outros valores mobiliários concedidos ou concedidos a não empregados para Fins compensatórios. Como essas informações podem ser importantes para os investidores na tomada de decisões de voto e investimento informadas, acreditamos que é apropriado exigir que todos os registrantes estejam sujeitos aos relatórios do Exchange Act para divulgá-lo regularmente. Mesmo quando a informação, como o número de títulos a serem emitidos no exercício, e o preço de exercício médio ponderado, das opções, dos warrants e dos direitos pendentes, de outra forma está disponível, não é transparente para os investidores. 56 As alterações aumentam a acessibilidade desta informação, tornando mais fácil para os investidores avaliar o impacto de políticas e práticas de remuneração de equivalentes de registrantes. Além disso, as alterações apresentam a informação em categorias - planos que foram aprovados pelos segurados e planos que não foram aprovados pelos segurados - que os investidores solicitaram. 57 A tabela a seguir reflete os atuais requisitos de divulgação do SFAS 123 para a remuneração baseada em ações 58 e a nova divulgação exigida pelas emendas adotadas hoje, conforme ajustado para minimizar a redundância entre os dois. Item de divulgação de remuneração de capital exigido pelo SFAS 123 Obrigatório pelo item 201 Divulgado por categoria: planos aprovados pelos segurados e planos não aprovados pelos segurados. Pode ser incorporado por referência no relatório anual no Formulário 10-K, incluindo na declaração de procuração. C. Localização da divulgação Conforme proposto, os registrantes devem incluir a tabela na declaração de procuração sempre que apresentaram um plano de compensação para a ação do segurador e no relatório anual no Formulário 10-K em todos os outros anos. Na versão proposta, buscamos comentar se o local proposto da divulgação era apropriado. A maioria dos comentadores sugeriu que, por consistência e para evitar confusão, devemos exigir a divulgação no mesmo documento a cada ano. 59 Citando a relevância da informação ao eleger diretores, vários comentadores sugeriram que exigimos a divulgação na declaração de procuração em todos os casos, mesmo que um registrante não apresentasse um plano de compensação para a ação do segurador. 60 Outros comentaristas, por outro lado, recomendaram que exijamos a divulgação somente no relatório anual no Formulário 10-K. 61 Embora a idéia de exigir a divulgação em um único local é atraente, optamos por não fazê-lo por vários motivos. Se adotássemos um requisito de que a tabela apareça apenas em declarações de procuração, um número significativo de empresas cujas obrigações de relatório decorrentes unicamente de acordo com a Seção 15 (d) da Lei de Câmbio 62 não estariam sujeitas ao requisito. Essas empresas não são necessárias para preparar e arquivar declarações de proxy. Além disso, não estamos convencidos de que, como regra geral, a divulgação proposta é importante para as decisões de voto dos segurados além das relacionadas aos planos de compensação. 63 Também não acreditamos que a tabela deve estar localizada exclusivamente no relatório anual no Formulário 10-K. Embora o relatório anual no Formulário 10-K esteja arquivado conosco, um registrante não é obrigado a entregá-lo aos segurados. 64 Assim, os detentores de segurança devem tomar alguma ação afirmativa para obter a informação. 65 Além disso, limitar a tabela ao relatório anual no Formulário 10-K perderia a divulgação nos casos em que a informação seria útil aos investidores na avaliação do mérito de um plano de compensação apresentado para a ação do segurado. 66 Concluímos que a melhor maneira de promover consistência, clareza e colocação relevante da nova informação é exigir que a tabela seja incluída anualmente no relatório anual de um registrante no Formulário 10-K 67 e, adicionalmente, na declaração de procuração quando O registrante está apresentando um plano de compensação para a ação do segurador. 68 Em situações em que um registrante é obrigado a incluir a informação em ambos os documentos, pode satisfazer sua obrigação de divulgação do Formulário 10-K, incorporando as informações exigidas por referência de sua declaração de procuração definitiva, se essa declaração envolver a eleição de diretores e é arquivada Até 120 dias após o final do ano fiscal coberto pelo Formulário 10-K. 69 D. Arquivando Cópias de Planos Não Aprovados por Detentores de Segurança Na Proposta de Projeção, buscamos comentar se, em vez de, ou além disso, a divulgação narrativa necessária para um plano de compensação de ações que tenha sido adotado sem a aprovação Dos detentores de títulos, um requerente deve ser obrigado a apresentar uma cópia do plano como uma exibição ao relatório anual dos registrantes no Formulário 10-K para o ano fiscal em que o plano foi adotado. 70 Vários comentaristas favoreceram um requisito de apresentação, além de exigir que os registrantes forneçam divulgação narrativa das características quotmateriais dos planos de compensação de ações aprovados pelo não detentor de seguranças. 71 O item 601 (b) (10) do Regulamento S-K 72 exige que os registrantes arquivem contratos materiais como peças mobiliárias a muitos dos seus documentos arquivados nos termos da Securities Act de 1933 (quotSecurities Actquot) e do Exchange Act. De particular relevância é a disposição do item 601 (b) (10) (iii) que declara que quotany contrato de gestão ou outro plano compensatório, contrato ou acordo, incluindo, entre outros, planos relacionados a opções, warrants ou direitos, pensões, aposentadorias ou A remuneração diferida ou bônus, incentivo ou participação nos lucros em que qualquer diretor ou qualquer dos diretores executivos do participante tenham participado deve ser considerado material e deve ser arquivado. quot 73 Item 601 (b) (10) (iii) também declara que quotany Outro contrato de gestão ou qualquer outro plano, contrato ou acordo de compensação em que qualquer outro diretor executivo participe deve ser arquivado, a menos que seja imaterial em quantidade ou significado. Alguns comentadores expressaram preocupação quanto ao fato de os planos aprovados pelo não segurado, muitos deles Que excluem executivos e diretores, muitas vezes não se enquadram nestas disposições. 75 Cremos que essa preocupação tem mérito. Consequentemente, modificamos o item 601 (b) (10) para exigir que os registrantes arquivem qualquer plano de remuneração de capital adotado sem a aprovação dos detentores de títulos em que participa qualquer funcionário (seja ou não um diretor executivo ou diretor do registrante), a menos que seja imaterial Em quantidade ou significado. 76 O cumprimento deste requisito deve garantir que planos significativos aprovados pelo não segurado estejam disponíveis para os investidores. 77 Juntamente com a descrição narrativa exigida dos planos aprovados pelo não segurado, os investidores devem ter acesso a informações completas sobre os planos de remuneração de capital principal de um registrante. III. Análise da Lei de Redução de Papelada As alterações contêm quotcollection de requisitos de informação na acepção da Lei de redução de papelada de 1995, 78 ou PRA. Publicamos um aviso solicitando comentários sobre a recolha de requisitos de informação na Proposta de lançamento e apresentamos esses requisitos ao Escritório de Gestão e Orçamento, ou OMB, para revisão. 79 Posteriormente, a OMB aprovou os requisitos de coleta de informações propostas. Conforme discutido na Seção I acima, recebemos várias cartas de comentários sobre as propostas. Fazemos uma série de mudanças nas propostas em resposta a esses comentários. Consequentemente, estamos revisando nossas estimativas de carga anterior. Estamos enviando as estimativas revisadas ao OMB para aprovação. 80 Uma agência não pode conduzir ou patrocinar, e uma pessoa não é obrigada a responder, uma coleção de informações, a menos que exiba um número de controle OMB atualmente válido. A. Resumo das alterações As alterações exigem a divulgação tabular do número de valores mobiliários a serem emitidos no exercício e do preço de exercício médio ponderado, de todas as opções pendentes, warrants e direitos ao abrigo de planos de compensação de equivalentes de inscritos, bem como o número Dos títulos que permanecem disponíveis para futuras emissões ao abrigo desses planos e certas informações relacionadas. A divulgação deve ser feita em duas categorias: planos aprovados pelos segurados e planos que não foram aprovados pelos segurados. Os inscritos devem incluir a tabela em seus relatórios anuais no Formulário 10-K ou 10-KSB e, além disso, em suas declarações de procuração ou informações nos anos em que eles estão apresentando um plano de compensação para a ação do titular de segurança. Os inscritos também devem apresentar cópias de nossos planos não aprovados pelo detentor de seguranças conosco, a menos que seja imaterial em quantidade ou significado. Preparar e arquivar um relatório anual no Formulário 10-K ou 10-KSB é uma coleção de informações. Da mesma forma, preparar, arquivar e divulgar uma declaração de proxy ou informação é uma coleção de informações. 81 A coleta de informações é obrigatória para todos os registrantes e não há prazo de retenção obrigatório para a informação coletada. A coleta de informações não será mantida em sigilo. B. Resumo das cartas de comentários e revisões às propostas Solicitamos o comentário sobre a análise PRA contida na versão proposta. Recebemos seis cartas de comentários abordando especificamente a carga de papelada estimada associada às coleções de informações. 82 Esses comentadores indicaram que o tempo necessário para cumprir as propostas seria significativo para muitos inscritos e substancialmente maior do que nossas estimativas. Um comentarista estimou que, se adotado, as propostas somariam pelo menos quatro páginas aos documentos de divulgação e, quando a divulgação apareceu na declaração de procuração, resultaria em custos de impressão adicionais de 100.000 e custos de envio adicionais de 200.000 para as páginas extras. 83 Outro comentarista sugeriu que compensamos qualquer aumento dos custos para os registrantes, eliminando os requisitos atuais que não resultam na divulgação de informações úteis. 84 Um terceiro comentarista sugeriu que consideremos fornecer uma forma modelo de divulgação para pequenas empresas para reduzir sua carga de conformidade. 85 Em resposta a esses comentários, fizemos uma série de alterações nas propostas, incluindo a eliminação de duas das colunas tabulares propostas e a divulgação agregada. Nós também estamos permitindo que os registrantes com planos aprovados por detentores de segurança não tenham descrito os termos materiais desses planos através da referência cruzada à sua divulgação SFAS 123. Essas mudanças irão simplificar a conformidade e, consequentemente, reduzir a carga para os registrantes. Embora as alterações exigem a apresentação de planos de compensação de equivalência não aprovados pelo detentor de seguranças, a menos que seja imaterial em quantidade ou significado, isso não deve aumentar significativamente o fardo para os registrantes, pois esses documentos estão prontamente disponíveis e serão arquivados eletronicamente. C. Revisões de Relatórios e Estimativas de Custos de Custos Como resultado das mudanças descritas acima e uma mudança em um de nossos pressupostos subjacentes, 86 as estimativas de relatórios e encargos de custo para as coleções de informações mudaram. Consequentemente, revisamos os requisitos estimados de coleta de informações originalmente submetidos à OMB. No que diz respeito aos Formulários 10-K e 10-KSB, aumentamos nossa estimativa em 1.174 horas no caso do Formulário 10-K e aumentamos nossa estimativa em 707 horas no caso do Formulário 10-KSB. Com respeito aos horários 14A e 14C, diminuímos a nossa estimativa em 13.139 horas no caso da programação 14A e diminuímos nossa estimativa em 139 horas no caso da programação 14C. Nossas estimativas são baseadas em vários pressupostos. Primeiro, estimamos que aproximadamente 60 87 dos registrantes que arquivam um relatório anual sobre Form 10-K ou 10-KSB mantêm planos de compensação de capital e serão necessários para fornecer a nova tabela de divulgação. 88 Também estimamos que aproximadamente 20 89 desses registradores mantêm planos de compensação de equivalência aprovados pelo detentor de seguranças e, portanto, será necessário descrever as características materiais desses planos e arquivar cópias conosco, a menos que seja imaterial em quantidade ou significado. 90 Nós ainda estimamos que, em qualquer ano, 30 91 dos registrantes com planos de remuneração de ações adotarão um novo plano ou alterarão um plano existente para aumentar o número de títulos autorizados para emissão nos termos do plano, desencadeando a divulgação da declaração de procuração ou informação . 92 Nessa situação, assumimos que um registrante incluirá a divulgação necessária em sua declaração de proxy ou informação e incorporará essa divulgação por referência em seu relatório anual no Formulário 10-K ou 10-KSB. Estimamos que aproximadamente 28 93 dos registrantes que arquivam relatórios anuais no Formulário 10-K ou 10-KSB estão sujeitos à Seção 13 da Lei de Câmbio em virtude da Seção 15 (d) da Lei de Câmbio e, portanto, não arquivam procuradores Ou declarações de informação, 94 e que aproximadamente 98 95 dos registrantes arquivam em representação, em vez de informações, declarações em conexão com a reunião anual de segurados em que os diretores devem ser eleitos. 96 Finalmente, estimamos que a preparação da divulgação tabular necessária levará duas horas de carga e, quando necessário, a preparação da descrição das características materiais de um plano de compensação de ações aprovado pelo não proprietário de segurança levará duas horas de carga. 97 Nossa estimativa revisada das horas de carga total das coleções necessárias de informações é apresentada na tabela a seguir. Além das horas internas que gastarão, 108 esperamos que os registrantes reterão conselho externo para auxiliar na elaboração das divulgações exigidas. 109 O custo total em dólares do cumprimento do Formulário 10-K e do Formulário 10-KSB, revisado para incluir os custos de advogados externos esperados das emendas, é estimado em 2.345.268.300 para o Formulário 10-K, um aumento de 1.758.300 da carga anual atual de 2.343.510.000 e 562.605.100 para Form10-KSB, um aumento de 617.100 da carga anual atual de 561.988.000. The total dollar cost of complying with Regulations 14A and 14C, revised to include outside counsel costs expected from the amendments, are estimated to be 93,254,500 for Regulation 14A, an increase of 640,500 from the current annual burden of 92,614,000, and 2,382,200 for Regulation 14C, an increase of 13,200 from the current annual burden of 2,369,000. 110 D. Request for Comment We request comment in order to (a) evaluate whether the collections of information are necessary for the proper performance of our functions, including whether the information will have practical utility, (b) evaluate the accuracy of our estimate of the burden of the collections of information, (c) determine whether there are ways to enhance the quality, utility and clarity of the information to be collected and (d) evaluate whether there are ways to minimize the burden of the collections of information on those who respond, including through the use of automated collection techniques or other forms of information technology. 111 Any member of the public may direct to us any comments concerning the accuracy of this burden estimate and any suggestions for reducing this burden. Persons who desire to submit comments on the collection of information requirements should direct their comments to the OMB, Attention: Desk Officer for the Securities and Exchange Commission, Office of Information and Regulatory Affairs, Washington, DC 20503, and send a copy of the comments to Jonathan G. Katz, Secretary, Securities and Exchange Commission, 450 Fifth Street NW, Washington, DC 20549, with reference to File No. S7-04-01. Requests for materials submitted to the OMB by us with regard to this collection of information should be in writing, refer to File No. S7-04-01 and be submitted to the Securities and Exchange Commission, Records Management, Office of Filings and Information Services, 450 Fifth Street NW, Washington, DC 20549. Because the OMB is required to make a decision concerning the collections of information between 30 and 60 days after publication, your comments are best assured of having their full effect if the OMB receives them within 30 days of publication. IV. Costs and Benefits of Final Rules The use of equity compensation, particularly stock options, has grown significantly during the last decade. 112 Consequently, existing security holders may face higher levels of dilution of their ownership interests as some companies issue more shares of their stock to employees. 113 Since the distribution of equity may result in a significant reallocation of ownership in an enterprise between existing security holders and management and employees, investors have a strong interest in understanding a registrants equity compensation program. 114 Until recently, security holder approval was required for most equity compensation plans. However, as approval requirements have been relaxed 115 and as opposition to these plans has grown, 116 an increasing number of registrants have adopted stock option plans without the approval of security holders, 117 thus potentially obscuring investors ability to assess the dilutive effect of a registrants equity compensation program. Our current rules do not require that a registrant disclose specific information about its non-security holder-approved equity compensation plans. 118 Nor do current financial reporting disclosure rules require that non-security holder-approved plans be identified. 119 Consequently, it is often difficult for investors to determine whether they have adequate information about a registrants equity compensation program. In response to ongoing investor concerns, 120 in January 2001 we proposed amendments to our rules to enhance the quality of information available to investors about equity compensation plans. 121 B. Response to Comment Letters In the Proposing Release, we noted that registrants would incur costs in complying with the proposals. We also noted that these costs, to the extent that they could be estimated, would not be significant, as the required disclosure can be derived from information that is readily available to registrants through the routine administration of their equity compensation programs. We requested comment on the costs and benefits of the proposals. Of the comment letters we received, 22 respondents discussed the costs and benefits associated with the proposals. 122 Most of the comment letters addressed these matters in general terms. Several respondents asserted that, because the proposals duplicated disclosure already required in registrants audited financial statements, the cost of providing information to investors would increase without any useful benefit. 123 In response to these comments, we have revised the proposals to eliminate redundant disclosure and to minimize the overlap with financial reporting requirements, thereby reducing the cost of compliance. As discussed in Subsection C below, the amendments will enhance the quality of the disclosure available to investors about the dilutive effect of registrants equity compensation programs. Other respondents, while generally supporting the proposals, suggested that we scale back the required disclosure to reduce compliance costs. For example, some respondents indicated that requiring plan-by-plan disclosure would create an undue burden for registrants without providing an incremental benefit to investors. 124 In response to these comments, we have revised the proposals to permit aggregated disclosure of information about plans and individual equity compensation arrangements and to allow the required narrative summary of a non-security holder-approved stock option plan to be provided by a cross-reference to a description of the plan in a registrants financial statements. 125 Some respondents suggested that we expand the required disclosure to include additional information, such as weighted-average exercise price data and information about existing equity compensation plans being submitted for security holder action. They also requested that we require the filing of non-security holder-approved equity compensation plans. We have made these changes. 126 Most respondents suggested that the proposed disclosure be required in the same document each year, to both streamline compliance and to minimize investor confusion. While we carefully considered this suggestion, ultimately we concluded that these concerns were outweighed by the need for consistent application of the disclosure to all registrants. 127 Accordingly, the required disclosure is to be provided each year in a registrants annual report on Form 10-K or 10-KSB and, additionally, in the proxy or information statement in years when the registrant is submitting a compensation plan for security holder action. 1. Disclosure of Non-Security Holder-Approved Plans New Item 201(d)(1) of Regulation S-K and Regulation S-B requires registrants to disclose whether they have one or more non-security holder-approved stock option plans by separately providing information about the dilutive effects of these plans. New Item 201(d)(3) of Regulation S-K and Regulation S-B requires that this disclosure be accompanied by a narrative summary of the material features of each non-security holder-approved plan. Also, as amended Item 601(b)(10) of Regulation S-K and Regulation S-B requires registrants to file a copy of any non-security holder-approved equity compensation plan with us unless the plan is immaterial in amount or significance. Presently, it is difficult for investors to ascertain whether a registrant has adopted a non-security holder approved stock option plan. 128 If a plan is broad-based, restricts or prohibits the participation of officers and directors and does not permit the grant of tax-qualified stock options, for instance, it is unlikely to require security holder approval. Frequently, investors must examine the required public filings of a registrant made over several years in order to identify the registrants stock option plans and determine if they have been approved by security holders. Even when a non-security holder-approved plan is identified, information about the plan may be limited since it may not be subject to our disclosure rules and may not be filed with us. The amendments will enable investors to ascertain if a registrant has adopted a non-security holder approved plan and highlight a description of the plans material features. 2. Tabular Disclosure New Item 201(d)(1) of Regulation S-K and Regulation S-B requires registrants to disclose, for their entire equity compensation program as in effect as of the end of the last completed fiscal year, the number of securities underlying, and the weighted-average exercise price of, outstanding options, warrants and rights and the number of securities remaining available for future issuance. This disclosure is to be made separately for plans approved by security holders and plans that have not been approved by security holders. The required disclosure will assist investors in assessing the potential dilution from a registrants equity compensation program in two ways. First, the required disclosure of the number of securities to be issued upon the exercise, and weighted-average exercise price, of all outstanding options, warrants and rights will enable investors to view this information in two categories: plans approved by security holders and plans not approved by security holders. While numerical and weighted-average exercise price information is presently available in the footnotes to a registrants audited financial statements, this disclosure does not separately identify the potential dilutive effect of any non-security-holder approved stock option plans. Second, disclosure of the number of securities available for future issuance under a registrants equity compensation plans will enable investors to better calculate the quotoverhangquot 129 resulting from the registrants entire equity compensation program. Under existing disclosure requirements, it is not always possible to make this calculation. 130 This information may be useful to investors where the cost of a registrants equity compensation plan exceeds its incentive effects. The new disclosure also will enhance the ability of investors and others, such as proxy review firms, to monitor the impact of a board of directors actions concerning equity compensation matters. Access to this information will make it easier for investors to determine both the portion of the current value of a business that will be transferred to option holders upon exercise and the potential allocation of future cash flow rights. 131 While the economic impact of outstanding options, warrants and rights is incorporated into the presentation of diluted earnings-per-share under SFAS 128, this calculation differs from the new disclosure in several ways. First, it does not isolate quotcompensatoryquot instruments. Typically, the diluted earnings-per-share figure combines the dilutive effect of compensatory options, warrants and rights with that of other outstanding convertible securities. Second, SFAS 128 employs the so-called quottreasury stock methodquot to compute diluted earnings-per-share. Among other things, this methodology excludes quotout-of-the-moneyquot options and warrants from the computation and requires certain assumptions about the timing of option exercises and the use of the assumed proceeds of exercise to arrive at the total number of potentially dilutive securities. Finally, while weighted-average exercise price information is available for various option groupings under SFAS 123, it does not differentiate between equity compensation plans that have been approved by security holders and plans that have not been approved by security holders. The amendments will increase the cost of preparing annual reports on Form 10-K and 10-KSB and proxy and information statements. Registrants must compile the required information, place it in the appropriate category and prepare the required table. In addition, registrants with non-security holder-approved stock option plans must prepare a narrative summary of the material features of each plan and file a copy of any material plan with us. Registrants also will incur an increase in printing and distribution costs as a result of the amendments. While several respondents indicated that the cost estimates in the Proposing Release were too low, 132 only one provided an alternative cost estimate. This respondent stated that compliance could result in additional costs approximating 300,000 in years when disclosure was required in its proxy statement. 133 The respondents estimate is no longer relevant because of the substantial revisions that we have made to the proposals, as discussed in Subsection B above. The required disclosure will provide investors both with new information and with an alternative means for analyzing currently available information. With respect to the dilution disclosure, we believe that the compliance costs are warranted because this information is not otherwise available to investors. Moreover, these costs should be minimal because this information can be derived from information that is readily available to registrants through the routine administration of their equity compensation programs. With respect to the information concerning non-security holder-approved stock option plans, much of the required tabular disclosure, such as the number of outstanding options, warrants and rights and the related weighted-average exercise price data, is already maintained for purposes of satisfying financial reporting requirements. The amendments merely require registrants to disclose this information on the basis of whether or not the related plan has been approved by security holders. In addition, many registrants summarize the material features of their equity compensation plans to satisfy their SFAS 123 disclosure obligations. Indeed, one respondent indicated that the amendments would result in only minimal additional costs to registrants because, in their experience, most registrants already maintain the required information in order to comply with SRO rules and for effective plan administration. 134 Although the amendments will increase the length of registrants annual reports on Form 10-K and 10-KSB, as well as their proxy and information statements, generally this should not have a major impact on a registrants printing and distribution costs. We have revised the proposals to reduce and standardize the size of the required tabular disclosure. These revisions should ensure that registrants do not incur significant additional printing and postage charges to prepare and distribute their proxy or information statements to security holders. While in most instances, the required disclosure should not exceed one-third of a page, where a registrant has one or more non-security holder-approved stock option plans, the disclosure may be longer. These registrants may incur additional expense to print and distribute their proxy or information statement materials. While we do not expect these costs to be significant, we have estimated these amounts to be approximately 750 per registrant. 135 For the reasons discussed above, we do not believe that the amendments will lead to significant compliance costs for registrants. 136 Notwithstanding the foregoing, we have adjusted our initial cost estimates to reflect the revisions made to the proposals. Because the size and scope of equity compensation programs vary among registrants, it is difficult to provide an accurate cost estimate with which all parties will agree however, we estimate that each of the approximately 8,400 registrants 137 subject to the amendments will spend an average of approximately one to two hours each year and incur an average annual cost of approximately 393 138 to prepare the disclosure. Thus, the aggregate cost of the amendments is estimated to be approximately 3,300,000. Based on the information provided in the comment letters and our own analysis, we believe that the amendments will enhance the quality of disclosure available to investors about registrants equity compensation plans, thereby leading to better-informed investment and voting decisions. These benefits are difficult to quantify. We also believe that these benefits will justify the minimal costs of compliance. V. Final Regulatory Flexibility Analysis This Final Regulatory Flexibility Analysis, or FRFA, has been prepared in accordance with the Regulatory Flexibility Act. 139 This FRFA relates to rule amendments adopted under the Exchange Act that revise the disclosure requirements with respect to registrants equity compensation plans. Specifically, the amendments revise Item 201 of Regulation S-B, Item 201 of Regulation S-K and Form 10-K, Form 10-KSB, Exchange Act Rule 14a-3 and Schedule 14A under the Exchange Act to require tabular disclosure of the number and weighted-average exercise price of all outstanding options, warrants and rights under a registrants equity compensation plans, as well as the number of securities remaining available for future issuance under these plans and certain related information. Disclosure is to be made in two categories: plans that have been approved by security holders and plans that have not been approved by security holders. Registrants must include the table in their annual reports on Form 10-K or 10-KSB, as well as in their proxy or information statements in years when they are submitting a compensation plan for security holder action. Copies of most equity compensation plans will be required to be filed with us for public inspection. A. Need for the Amendments The increased use of equity compensation has raised investor concerns about the potential dilutive effect of a registrants equity compensation plans, the absence of full disclosure to security holders about these plans and the adoption of many plans without the approval of security holders. These concerns may be especially acute for investors in small entities, which use equity compensation in order to attract and retain key employees and to preserve scarce cash resources. 140 The amendments enhance the quality of information available to investors about a registrants equity compensation plans. B. Significant Issues Raised by Public Comment A summary of the Initial Regulatory Flexibility Analysis, or IRFA, appeared in the Proposing Release. 141 We requested comment on any aspect of the IRFA, including the number of small businesses that would be affected by the proposals, the nature of the impact, how to quantify the number of small entities that would be affected and how to quantify the impact of the proposals. We received no comment letters responding to that request. C. Small Entities Subject to the Amendments Exchange Act Rule 0-10 142 defines the term quotsmall businessquot to be an issuer that, on the last day of its most recent fiscal year, has total assets of 5 million or less. 143 There are approximately 770 issuers that are subject to the reporting requirements of Section 13 of the Exchange Act that have assets of 5 million or less. 144 Only small businesses that have a reporting obligation under the Exchange Act and adopt or maintain an equity compensation plan will be subject to the amendments. We estimate that there are approximately 460 entities that have total assets of 5 million or less that meet this criteria. 145 D. Projected Reporting, Recordkeeping and Other Compliance Requirements The amendments impose new reporting requirements by requiring specific annual disclosure by all registrants, including quotsmall businesses, quot concerning their equity compensation plans in effect as of the end of the most recently completed fiscal year. Consequently, the amendments will increase the costs associated with the preparation of the disclosure included in annual reports on Form 10-K or 10-KSB and furnished to security holders in proxy and information statements. Specifically, the amendments require registrants to disclose the number and weighted-average exercise price of all outstanding options, warrants and rights under a registrants equity compensation plans, as well as the number of securities remaining available for future issuance under these plans and certain related information. Disclosure is to be made in two categories: plans that have been approved by security holders and plans that have not been approved by security holders. Since this information can be derived from information that is readily available to registrants through the routine administration of their equity compensation programs, we do not expect these additional costs to be significant. We do not anticipate that the amendments will impose any significant recordkeeping requirements in addition to those already required under the Exchange Act. The information to be disclosed can be derived from information that is readily available to registrants through the routine administration of their equity compensation programs. All registrants with equity compensation plans have various legal, financial reporting and other disclosure obligations that require maintenance of information regarding these plans similar to that covered by the amendments. E. Agency Action to Minimize Effect on Small Entities As required by Sections 603 and 604 of the Regulatory Flexibility Act, we have considered alternatives that would accomplish the stated objectives, while minimizing any significant adverse impact on small entities. In connection with the amendments, we considered several alternatives, including the following: establishing different compliance and reporting requirements that take into account the resources of small entities clarifying, consolidating or simplifying compliance and reporting requirements under the rules for small entities using performance rather than design standards and exempting small entities from all or part of the requirements. Overall, the amendments are intended to assist investors in understanding a registrants equity compensation policies and practices. The quality of information available about the potential dilutive effect of a registrants equity compensation plans is relevant to investors in both small and large entities. Different compliance or reporting requirements for small entities are not appropriate because small entities may use equity compensation plans to a greater extent than large entities to preserve scarce cash resources. 146 In addition, it is not feasible to further clarify, consolidate or simplify the amendments for small entities because the amendments require only minimal information about a registrants equity compensation plans. Because uniformity and comparability are important, especially where small entities have equity compensation plans, we do not propose to use performance standards to specify different requirements for small entities. Finally, we believe that the amendments should apply equally to all entities required to disclose information, in order to safeguard protection of all investors. VI. Analysis of Impact on the Economy, Burden on Competition and Promotion of Efficiency, Competition and Capital Formation Section 23(a)(2) of the Exchange Act 147 requires us, when adopting rules under the Exchange Act, to consider the impact that any new rule will have on competition. In addition, Section 23(a)(2) prohibits us from adopting any rule that will impose a burden on competition not necessary or appropriate in furtherance of the purposes of the Exchange Act. We have considered the amendments in light of the standards in Section 23(a)(2). We requested comment on any anti-competitive effects of the proposals. We received no comment letters responding to that request. The amendments may have a disparate impact on registrants that use equity compensation extensively, such as smaller firms or registrants in certain industry sectors (such as high-technology companies), as compared to registrants with limited or no equity compensation programs. 148 Thus, we are sensitive to the concern that registrants with a greater compliance obligation will be placed at a competitive disadvantage. In addition, several commenters, while not specifically addressing this issue, did argue that the new disclosure would be duplicative of information currently required to be included in registrants audited financial statements. In response to these concerns, we have revised the proposals to eliminate redundant requirements and to streamline the compliance process. Because these changes should enable registrants to keep compliance costs low, we do not believe that the amendments will impose a significantly disproportionate cost on smaller firms or high-technology companies. Section 2(b) of the Securities Act and Section 3(f) of the Exchange Act 149 require us, when engaging in rulemaking requiring us to consider or determine whether an action is necessary or appropriate in the public interest, to consider, in addition to the protection of investors, whether the action will promote efficiency, competition and capital formation. We have considered the amendments in light of the standards in these provisions. We requested comment on how the proposals would affect efficiency, competition and capital formation. We received no comment letters responding to that request. It is widely believed that equity compensation, particularly instruments such as stock options, can be used to align the interests of employees and security holders, thereby promoting effective corporate governance. 150 Because an equity compensation plan may necessarily have an unintended dilutive effect on the existing ownership interests, however, it is important that the plan be closely monitored to ensure that its cost is commensurate with its benefit to investors. The amendments are intended to enhance the quality of disclosure about registrants equity compensation programs that is available to investors. Increasing the transparency of these programs should result in better monitoring by investors. This should result in better corporate governance, thereby increasing the efficiency of the organization. This should promote capital formation. VII. Statutory Authority The amendments contained in this release are being adopted under the authority set forth in Sections 3(b) and 19(a) of the Securities Act and Sections 12, 13, 14(a), 15(d) and 23(a) of the Exchange Act. List of Subjects in 17 CFR Parts 228, 229, 240 and 249 Reporting and recordkeeping requirements, Securities. TEXT OF RULE AMENDMENTS In accordance with the foregoing, Title 17, Chapter II of the Code of Federal Regulations is amended as follows: PART 228 - INTEGRATED DISCLOSURE SYSTEM FOR SMALL BUSINESS ISSUERS 1. The general authority citation for Part 228 continues to read as follows: Authority . 15 U. S.C. 77e, 77f, 77g, 77h, 77j, 77k, 77s, 77z-2, 77aa(25), 77aa(26), 77ddd, 77eee, 77ggg, 77hhh, 77jjj, 77nnn, 77sss, 78 l . 78m, 78n, 78o, 78u-5, 78w, 78 ll . 80a-8, 80a-29, 80a-30, 80a-37 and 80b-11, unless otherwise noted. 2. Section 228.201 is amended by adding paragraph (d) before the Instruction to read as follows: sect228.201 (Item 201) Market for Common Equity and Related Stockholder Matters. (d) Securities authorized for issuance under equity compensation plans . (1) In the following tabular format, provide the information specified in paragraph (d)(2) of this Item as of the end of the most recently completed fiscal year with respect to compensation plans (including individual compensation arrangements) under which equity securities of the small business issuer are authorized for issuance, aggregated as follows: (i) All compensation plans previously approved by security holders and (ii) All compensation plans not previously approved by security holders. Equity Compensation Plan Information Number of securities to be issued upon exercise of outstanding options, warrants and rights Weighted-average exercise price of outstanding options, warrants and rights Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) Equity compensation plans approved by security holders (2) The table shall include the following information as of the end of the most recently completed fiscal year for each category of equity compensation plan described in paragraph (d)(1) of this Item: (i) The number of securities to be issued upon the exercise of outstanding options, warrants and rights (column (a)) (ii) The weighted-average exercise price of the outstanding options, warrants and rights disclosed pursuant to paragraph (d)(2)(i) of this Item (column (b)) and (iii) Other than securities to be issued upon the exercise of the outstanding options, warrants and rights disclosed in p aragraph (d)(2)(i) of this Item, the number of securities remaining available for future issuance under the plan (column (c)). (3) For each compensation plan under which equity securities of the small business issuer are authorized for issuance that was adopted without the approval of security holders, describe briefly, in narrative form, the material features of the plan. Instructions to Paragraph (d). 1. Disclosure shall be provided with respect to any compensation plan and individual compensation arrangement of the small business issuer (or parent, subsidiary or affiliate of the small business issuer) under which equity securities of the small business issuer are authorized for issuance to employees or non-employees (such as directors, consultants, advisors, vendors, customers, suppliers or lenders) in exchange for consideration in the form of goods or services as described in Statement of Financial Accounting Standards No. 123, Accounting for Stock-Based Compensation . or any successor standard. No disclosure is required with respect to (i) any plan, contract or arrangement for the issuance of warrants or rights to all security holders of the small business issuer as such on a pro rata basis (such as a stock rights offering) or (ii) any employee benefit plan that is intended to meet the qualification requirements of Section 401(a) of the Internal Revenue Code (26 U. S.C. sect401(a)). 2. For purposes of this paragraph, an quotindividual compensation arrangementquot includes, but is not limited to, the following: a written compensation contract within the meaning of quotemployee benefit planquot under sect230.405 of this chapter and a plan (whether or not set forth in any formal document) applicable to one person as provided under Item 402(a)(7)(ii) of Regulation S-B (sect228.402(a)(7)(ii)). 3. If more than one class of equity security is issued under its equity compensation plans, a small business issuer should aggregate plan information for each class of security. 4. A small business issuer may aggregate information regarding individual compensation arrangements with the plan information required under paragraph (d)(1)(i) and (ii) of this item, as applicable. 5. A small business issuer may aggregate information regarding a compensation plan assumed in connection with a merger, consolidation or other acquisition transaction pursuant to which the small business issuer may make subsequent grants or awards of its equity securities with the plan information required under paragraph (d)(1)(i) and (ii) of this item, as applicable. A small business issuer shall disclose on an aggregated basis in a footnote to the table the information required under paragraph (d)(2)(i) and (ii) of this item with respect to any individual options, warrants or rights assumed in connection with a merger, consolidation or other acquisition transaction. 6. To the extent that the number of securities remaining available for future issuance disclosed in column (c) includes securities available for future issuance under any compensation plan or individual compensation arrangement other than upon the exercise of an option, warrant or right, disclose the number of securities and type of plan separately for each such plan in a footnote to the table. 7. If the description of an equity compensation plan set forth in a small business issuers financial statements contains the disclosure required by paragraph (d)(3) of this item, a cross-reference to such description will satisfy the requirements of paragraph (d)(3) of this item. 8. If an equity compensation plan contains a formula for calculating the number of securities available for issuance under the plan, including, without limitation, a formula that automatically increases the number of securities available for issuance by a percentage of the number of outstanding securities of the small business issuer, a description of this formula shall be disclosed in a footnote to the table. 9. Except where it is part of a document that is incorporated by reference into a prospectus, the information required by this paragraph need not be provided in any registration statement filed under the Securities Act. 3. Section 228.601 is amended by redesignating paragraph (b)(10)(ii)(B) as paragraph (b)(10)(ii)(C) and by adding new paragraph (b)(10)(ii)(B) to read as follows: sect228. 601 (Item 601) Exhibits (b) Description of Exhibits (10) Material Contracts (B) Any compensatory plan, contract or arrangement adopted without the approval of security holders pursuant to which equity may be awarded, including, but not limited to, options, warrants or rights (or if not set forth in any formal document, a written description thereof), in which any employee (whether or not an executive officer of the small business issuer) participates shall be filed unless immaterial in amount or significance. A compensation plan assumed by a small business issuer in connection with a merger, consolidation or other acquisition transaction pursuant to which the small business issuer may make further grants or awards of its equity securities shall be considered a compensation plan of the small business issuer for purposes of the preceding sentence. PART 229 - STANDARD INSTRUCTIONS FOR FILING FORMS UNDER SECURITIES ACT OF 1933, SECURITIES EXCHANGE ACT OF 1934 AND ENERGY POLICY AND CONSERVATION ACT OF 1975 - REGULATION S-K 4. The general authority citation for Part 229 is revised to read as follows: Authority . 15 U. S.C. 77e, 77f, 77g, 77h, 77j, 77k, 77s, 77z-2, 77aa(25), 77aa(26), 77ddd, 77eee, 77ggg, 77hhh, 77iii, 77jjj, 77nnn, 77sss, 78c, 78i, 78j, 78 l . 78m, 78n, 78o, 78u-5, 78w, 78 ll (d), 79e, 79n, 79t, 80a-8, 80a-29, 80a-30, 80a-31(c), 80a-37, 80a-38(a), and 80b-11, unless otherwise noted. 5. The authority citation following sect229.201 is removed. 6. Section 229.201 is amended by adding paragraph (d) before the Instructions to Item 201 to read as follows: sect229.201 (Item 201) Market price of and dividends on the registrants common equity and related stockholder matters. (d) Securities authorized for issuance under equity compensation plans . (1) In the following tabular format, provide the information specified in paragraph (d)(2) of this Item as of the end of the most recently completed fiscal year with respect to compensation plans (including individual compensation arrangements) under which equity securities of the registrant are authorized for issuance, aggregated as follows: (i) All compensation plans previously approved by security holders and (ii) All compensation plans not previously approved by security holders. Equity Compensation Plan Information Number of securities to be issued upon exercise of outstanding options, warrants and rights Weighted-average exercise price of outstanding options, warrants and rights Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) Equity compensation plans approved by security holders (2) The table shall include the following information as of the end of the most recently completed fiscal year for each category of equity compensation plan described in paragraph (d)(1) of this Item: (i) The number of securities to be issued upon the exercise of outstanding options, warrants and rights (column (a)) (ii) The weighted-average exercise price of the outstanding options, warrants and rights disclosed pursuant to paragraph (d)(2)(i) of this Item (column (b)) and (iii) Other than securities to be issued upon the exercise of the outstanding options, warrants and rights disclosed in p aragraph (d)(2)(i) of this Item, the number of securities remaining available for future issuance under the plan (column (c)). (3) For each compensation plan under which equity securities of the registrant are authorized for issuance that was adopted without the approval of security holders, describe briefly, in narrative form, the material features of the plan. Instructions to Paragraph (d). 1. Disclosure shall be provided with respect to any compensation plan and individual compensation arrangement of the registrant (or parent, subsidiary or affiliate of the registrant) under which equity securities of the registrant are authorized for issuance to employees or non-employees (such as directors, consultants, advisors, vendors, customers, suppliers or lenders) in exchange for consideration in the form of goods or services as described in Statement of Financial Accounting Standards No. 123, Accounting for Stock-Based Compensation . or any successor standard. No disclosure is required with respect to (i) any plan, contract or arrangement for the issuance of warrants or rights to all security holders of the registrant as such on a pro rata basis (such as a stock rights offering) or (ii) any employee benefit plan that is intended to meet the qualification requirements of Section 401(a) of the Internal Revenue Code (26 U. S.C. sect401(a)). 2. For purposes of this paragraph, an quotindividual compensation arrangementquot includes, but is not limited to, the following: a written compensation contract within the meaning of quotemployee benefit planquot under sect230.405 of this chapter and a plan (whether or not set forth in any formal document) applicable to one person as provided under Item 402(a)(7)(ii) of Regulation S-K (sect229.402(a)(7)(ii)). 3. If more than one class of equity security is issued under its equity compensation plans, a registrant should aggregate plan information for each class of security. 4. A registrant may aggregate information regarding individual compensation arrangements with the plan information required under paragraph (d)(1)(i) and (ii) of this item, as applicable. 5. A registrant may aggregate information regarding a compensation plan assumed in connection with a merger, consolidation or other acquisition transaction pursuant to which the registrant may make subsequent grants or awards of its equity securities with the plan information required under paragraph (d)(1)(i) and (ii) of this item, as applicable. A registrant shall disclose on an aggregated basis in a footnote to the table the information required under paragraph (d)(2)(i) and (ii) of this item with respect to any individual options, warrants or rights assumed in connection with a merger, consolidation or other acquisition transaction. 6. To the extent that the number of securities remaining available for future issuance disclosed in column (c) includes securities available for future issuance under any compensation plan or individual compensation arrangement other than upon the exercise of an option, warrant or right, disclose the number of securities and type of plan separately for each such plan in a footnote to the table. 7. If the description of an equity compensation plan set forth in a registrants financial statements contains the disclosure required by paragraph (d)(3) of this item, a cross-reference to such description will satisfy the requirements of paragraph (d)(3) of this item. 8. If an equity compensation plan contains a formula for calculating the number of securities available for issuance under the plan, including, without limitation, a formula that automatically increases the number of securities available for issuance by a percentage of the number of outstanding securities of the registrant, a description of this formula shall be disclosed in a footnote to the table. 9. Except where it is part of a document that is incorporated by reference into a prospectus, the information required by this paragraph need not be provided in any registration statement filed under the Securities Act. 7. Section 229.601 is amended by redesignating paragraph (b)(10)(iii)(B) as paragraph (b)(10)(iii)(C) and by adding new paragraph (b)(10)(iii)(B) to read as follows: sect229. 601 (Item 601) Exhibits (b) Description of Exhibits (10) Material Contracts (B) Any compensatory plan, contract or arrangement adopted without the approval of security holders pursuant to which equity may be awarded, including, but not limited to, options, warrants or rights (or if not set forth in any formal document, a written description thereof), in which any employee (whether or not an executive officer of the registrant) participates shall be filed unless immaterial in amount or significance. A compensation plan assumed by a registrant in connection with a merger, consolidation or other acquisition transaction pursuant to which the registrant may make further grants or awards of its equity securities shall be considered a compensation plan of the registrant for purposes of the preceding sentence. PART 240 - GENERAL RULES AND REGULATIONS, SECURITIES EXCHANGE ACT OF 1934 8. The general authority citation for Part 240 is revised to read, in part, as follows: Authority . 15 U. S.C. 77c, 77d, 77g, 77j, 77s, 77z-2, 77z-3, 77eee, 77ggg, 77nnn, 77sss, 77ttt, 78c, 78d, 78e, 78f, 78g, 78i, 78j, 78j-1, 78k, 78k-1, 78 l . 78m, 78n, 78o, 78p, 78q, 78s, 78u-5, 78w, 78x, 78 ll . 78mm, 79q, 79t, 80a-20, 80a-23, 80a-29, 80a-37, 80b-3, 80b-4 and 80b-11, unless otherwise noted. 9. The authority citation following sect240.14a-3 is removed. 10. Section 240.14a-3 is amended by revising paragraph (b)(9) to read as follows: sect240.14a-3 Information to be furnished to security holders. (9) The report shall contain the market price of and dividends on the registrants common equity and related security holder matters required by Item 201(a), (b) and (c) of Regulation S-K (sect229.201(a), (b) and (c) of this chapter). 11. In Section 240.14a-101 amend Item 10 of Schedule 14A by adding paragraph (c) before the undesignated heading Instructions and revise Item 14(d)(4) of Schedule 14A to read as follows: sect240.14a-101 Schedule 14A. Information required in proxy statement. Item 10. Compensation Plans. (c) Information regarding plans and other arrangements not subject to security holder action. Furnish the information required by Item 201(d) of Regulation S-K (sect229.201(d) of this chapter). Instructions to paragraph (c). 1. If action is to be taken as described in paragraph (a) of this Item with respect to the approval of a new compensation plan under which equity securities of the registrant are authorized for issuance, information about the plan shall be disclosed as required under paragraphs (a) and (b) of this Item and shall not be included in the disclosure required by Item 201(d) of Regulation S-K (sect229.201(d) of this chapter). If action is to be taken as described in paragraph (a) of this Item with respect to the amendment or modification of an existing plan under which equity securities of the registrant are authorized for issuance, the registrant shall include information about securities previously authorized for issuance under the plan (including any outstanding options, warrants and rights previously granted pursuant to the plan and any securities remaining available for future issuance under the plan) in the disclosure required by Item 201(d) of Regulation S-K (sect229.201(d) of this chapter). Any additional securities that are the subject of the amendments or modification of the existing plan shall be disclosed as required under paragraphs (a) and (b) of this Item and shall not be included in the Item 201(d) disclosure. Item 14. Mergers, consolidations, acquisitions and similar matters. (d) Information about parties to the transaction: registered investment companies and business development companies. (4) Information required by Item 201(a), (b) and (c) of Regulation S-K (sect229.201(a), (b) and (c) of this chapter), market price of and dividends on the registrants common equity and related stockholder matters PART 249 - FORMS, SECURITIES EXCHANGE ACT OF 1934 12. The authority citation for Part 249 continues to read, in part, as follows: Authority . 15 U. S.C. 78a et seq . unless otherwise noted 13. By amending Form 10-K (referenced in sect249.310) by revising Item 12 of Part III to read as follows: Note - The text of Form 10-K does not, and this amendment will not, appear in the Code of Federal Regulations. Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters. Furnish the information required by Item 201(d) of Regulation S-K (sect229.201(d) of this chapter) and by Item 403 of Regulation S-K (sect229.403 of this chapter). 12. By amending Form 10-KSB (referenced in sect249.310b) by revising Item 11 of Part III to read as follows: Note - The text of Form 10-KSB does not, and this amendment will not, appear in the Code of Federal Regulations. Item 11. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters. Furnish the information required by Item 201(d) of Regulation S-B and by Item 403 of Regulation S-B. By the Commission. Item 1 of Schedule 14C requires that a registrant furnish the information called for by all of the items of Schedule 14A (other than Items 1(c), 2, 4 and 5) which would be applicable to any matter to be acted upon at the meeting if proxies were to be solicited in connection with the meeting. A study of stock-based pay practices at the nations 200 largest corporations indicates that these companies allocated 15.2 of outstanding shares (calculated on a fully-diluted basis) for management and employee equity incentives in 2000, compared to only 6.9 in 1989. See Pearl Meyers amp Partners, Inc. 2000 Equity Stake, Study of Management Equity Participation in the Top 200 Corporations (2000). See Eric D. Roiter, The NYSE Wrestles with Shareholder Approval of Stock Option Plans . Corp. Gov. Adv. Vol. 8, No. 1 (Jan. Feb. 2000), at 1. See also, for example, Justin Fox, The Amazing Stock Option Sleight of Hand . Fortune, June 25, 2001, at 86. In its most recent study, the Investor Responsibility Research Center found that the average potential dilution for the 1,500 companies in the quotSampP Super 1,500quot (the combination of the SampP 500, the SampP MidCap 400 and the SampP SmallCap 600) was 14.6 in 2000, compared to 11.6 in 1997 an increase of approximately 26. The increase was even greater for SampP 500 companies, with average potential dilution rising to 13.1 in 2000, compared to 9.2 in 1995. See Investor Responsibility Research Center, Potential Dilution - 2000, The Potential Dilution from Stock Plans at the SampP Super 1,500 Companies (2000) (the quotIRRC Dilution Studyquot). The amendments were proposed in Release No. 33-7944 (Jan. 26, 2001) 66 FR 8732 (the quotProposing Releasequot). The commenters included 11 individual and institutional investors, eight registrants and registrant associations (one registrant submitted two letters), one self-regulatory organization and 10 members of the executive compensation consulting, accounting and legal communities. These comment letters and a summary of comments prepared by our staff are available for public inspection and copying in our Public Reference Room, 450 Fifth Street, NW, Washington, DC 20549, in File No. S7-04-01. Public comments submitted electronically and the summary of comments are available on our website sec. gov . The discussion of Form 10-K in this release also includes Form 10-KSB. The discussion of proxy statements in this release also includes Schedule 14C information statements. To help investors better understand equity compensation, our Office of Investor Education and Assistance will create educational materials about the available disclosure on equity compensation programs (including the information available in financial statements). See, for example, the Letter dated March 26, 2001 from the Council of Institutional Investors (the quotCII Letterquot), the Letter dated April 24, 2001 from the Association for Investment Management and Research and the Letter dated April 16, 2001 from the Association of the Bar of the City of New York (the quotNYC Bar Letterquot). While the impact of outstanding options, warrants and rights is contained in the presentation of diluted earnings-per-share required by Statement of Financial Accounting Standards No. 128, Earnings-Per-Share (Feb. 1997) (quotSFAS 128quot), this disclosure does not necessarily isolate quotcompensatoryquot instruments. Typically, the diluted earnings-per-share figure combines the dilutive effect of compensatory options, warrants and rights with that of other outstanding convertible securities. See new Item 201(d)(2)(ii) of Regulation S-B 17 CFR 228.201(d)(2)(ii) and new Item 201(d)(2)(ii) of Regulation S-K 17 CFR 229.201(d)(2)(ii). This weighted-average exercise price information may be different from that contained in a registrants financial statements as required by Statement of Financial Accounting Standards No. 123, Accounting for Stock-Based Compensation (Oct. 1995) (quotSFAS 123quot) because the information includes grants and awards to non-employees while the information required by SFAS 123 may not. See n. 55 below. This includes any equity compensation plan that provides for grants and awards to employees or non-employees in exchange for consideration in the form of goods or services as described in SFAS 123. For purposes of the amendments, we consider an equity compensation plan to be in effect as long as securities remain available for future issuance under the plan, or as long as options, warrants or rights previously granted under the plan remain outstanding. Disclosure is required without regard to whether participants are employees (including officers) or non-employees (such as directors, consultants, advisors, vendors, customers, suppliers or lenders). See, for example, the Letter dated May 7, 2001 from the American Bar Association (the quotABA Letterquot), the Letter dated April 2, 2001 from Lucent Technologies Inc. and the Letter dated May 22, 2001 from the New York State Bar Association (the quotNY State Bar Letterquot). One commenter estimated that, based upon the number of equity compensation plans it administers, compliance could cost an additional 300,000 annually for printing and distribution. See the Letter dated April 9, 2001 from Lucent Technologies Inc. (the quotSecond Lucent Letterquot). See the Letter dated February 27, 2001 from Intel Corporation (the quotIntel Letterquot). In addition, information on the number and identity of a registrants equity compensation plans should be available in the footnotes to the registrants financial statements as part of its required SFAS 123 disclosure. See paragraph 46 of SFAS 123. See new Item 201(d)(1) of Regulation S-B 17 CFR 228.201(d)(1) and new Item 201(d)(1) of Regulation S-K 17 CFR 229.201(d)(1). These plans otherwise are subject to the disclosure requirements of Item 10 of Schedule 14A. Item 10 requires a description of the material features of, and tabular disclosure of the benefits receivable or allocable under, the plan being acted upon, as well as additional information regarding specific types of plans. See, for example, the CII Letter, the Letter dated March 28, 2001 from the State of Wisconsin Investment Board (the quotSWIB Letterquot) and the Letter dated March 29, 2001 from the Teachers Insurance and Annuity Association - College Retirement Equities Fund (the quotTIAA-CREF Letterquot). See Instruction 1 to new Item 10(c) of Schedule 14A. For these purposes, an individual equity compensation arrangement includes a quotplanquot for a single person as defined by Item 402(a)(7)(ii) of Regulation S-K 17 CFR 229.402(a)(7)(ii) (quotA plan may be applicable to one person. quot), as well as an individual quotwritten compensation contractquot (see, for example, the Securities Act Rule 405 17 CFR 230.405 definition of the term quotemployee benefit planquot). See, for example, the NY State Bar Letter and the TIAA-CREF letter. See Report of the New York Stock Exchange Special Task Force on Stockholder Approval Policy (Oct. 1999) (the quotNYSE Task Force Reportquot), at 14, available at nysepdfspolicy. pdf . While SFAS 123 requires an entity to provide a description of each stock-based compensation plan, these descriptions need not indicate whether a plan has been approved by security holders. See paragraphs 46 and 362 of SFAS 123. Paragraph 46 of SFAS 123 provides for disclosure of the number of shares authorized for grants of options or other equity instruments pursuant to stock-based compensation plans. It does not specifically require disclosure of the current number of authorized shares available for grant. In addition, it may be difficult for investors to determine this number. Currently, a registrant submitting an equity compensation plan for security holder action need not provide any specific disclosure about its other equity compensation plans. In its annual study on stock plan dilution, the Investor Responsibility Research Center found that approximately 22 of the companies surveyed did not disclose the number of shares available for future issuance under their employee stock plans. See the IRRC Dilution Study. Paragraph 46 of SFAS 123 provides that quotan entity that uses equity instruments to acquire goods or services other than employee services shall provide disclosures similar to those required for employee transactions to the extent that those disclosures are important in understanding the effects of those transactions on the financial statementsquot (emphasis added). Consequently, a registrant has discretion to exclude non-employee grants and awards of equity instruments from its SFAS 123 disclosure. In addition, registrants need not apply the disclosure provisions of SFAS 123 to immaterial items, as determined based on a registrants particular circumstances. See paragraph 244 of SFAS 123. See, for example, the NYSE Task Force Report, n. 52 above, at 14 (quotThe requisite information to make dilution calculations is not consistently available in any one place or format in corporate disclosure documents. ), the Letter dated April 2, 2001 from the Association of Publicly Traded Companies (quotthe sheer volume and complexity of most corporate compensation proposals, coupled with stock option plans, makes it difficult for the average investor to interpret and effectively utilize the information provided. quot) and the TIAA-CREF Letter (quotlack of transparency. limits the ability of shareholders. to protect themselves against plans that can be highly dilutive. quot). See the Proposing Release at n. 17. This table does not describe all of the information that registrants must disclose under SFAS 123. In the Proposing Release, we also sought comment as to whether the table should be required in registration statements filed under the Securities Act of 1933 15 U. S.C. sectsect77a et seq .. While no commenter favored a blanket requirement for all registration statements, two commenters suggested that registrants include the table in registration statements filed in connection with initial public offerings. See the NYC Bar Letter and the NY State Bar Letter. Two commenters expressly opposed a registration statement disclosure requirement. See the ABA Letter and the Letter dated June 11, 2001 from the New York Stock Exchange (the quotNYSE Letterquot). Generally, registrants already include information about the possible effects of future sales of securities, including outstanding options, in registration statements for initial public offerings to the extent that this information is material. Item 506 of Regulation S-K 17 CFR 229.506 requires specific information in a registration statement filed in connection with an initial public offering about dilution, as well as with respect to common equity securities that have been acquired by officers and directors. In addition, Item 201(a)(2) of Regulation S-K 17 CFR 229.201(a)(2) requires disclosure of the amount of common equity that is subject to outstanding options or warrants. Further information is available pursuant to the disclosure required by Item 402 of Regulation S-K. Accordingly, except where the table is part of an annual report on Form 10-K or 10-KSB that is incorporated by reference into a prospectus, we are not extending the disclosure requirements to registration statements at this time. See Instruction 10 to new Item 201(d) of Regulation S-B and Instruction 10 to new Item 201(d) of Regulation S-K. See, for example, the ABA Letter, the CII Letter and the SWIB Letter. See, for example, the Letter dated March 29, 2001 from Ernst ampYoung LLP, the Second Lucent Letter and the NYC Bar Letter. 15 U. S.C. sect78o(d). Some commenters argued that even where a registrant is not submitting a compensation plan for security holder action, the new disclosure contains relevant information with respect to the backgrounds and compensation of directors and executive officers that should be available for evaluation in connection with the election of directors. In general, we find the relevance of the new disclosure to be somewhat attenuated from decisions regarding the election of directors. Moreover, there would be little connection when a nominee has not served previously as a director of the registrant. Finally, the relevance of the new disclosure to decisions concerning the remuneration of directors and officers also is questionable because the table requires general information that does not specifically identify director and executive officer awards. Registrants are required, however, to provide security holders with an annual report to security holders pursuant to Exchange Act Rule 14a-3(b) 17 CFR 240.14a-3(b) when soliciting proxies in connection with an annual meeting of security holders at which directors are to be elected. Typically, this annual report to security holders includes the financial statements of the registrant, including the required SFAS 123 disclosure. In some instances, registrants use their annual report on Form 10-K to satisfy this delivery requirement. See Exchange Act Rule 14a-3(d) 17 CFR 240.14a-3(d). Under Exchange Act Rule 14a-3(b)(10) 17 CFR 240.14a-3(b)(10), a registrant must include in its proxy statement or annual report an undertaking to provide without charge to each security holder solicited, upon written request, a copy of the registrants annual report on Form 10-K. Once filed, the annual report on Form 10-K also is available via our Electronic Data Gathering, Analysis and Retrieval, or EDGAR, system. Another possible location for the table is the annual report to security holders required by Exchange Act Rule 14a-3(b). This alternative has several drawbacks, however. First, because it is not considered a quotfiledquot document, the annual report is not subject to the express civil liability provisions of Section 18 of the Exchange Act 15 U. S.C. sect78r. See Exchange Act Rule 14a-3(c) 17 CFR 240.14a-3(c). Second, as with proxy statements, the disclosure would not apply to registrants subject to reporting solely under Section 15(d) of the Exchange Act. Finally, because principally financial information is required to be included in the annual report, non-financial disclosure such as the table would appear out of place. See revised Item 12 of Part III of Form 10-K and revised Item 11 of Part III of Form 10-KSB. See new Item 10(c) of Schedule 14A. Proxy or information statement disclosure is triggered by the submission of any compensation plan for security holder action, including cash-only plans. Similar incorporation by reference is permitted with respect to the other disclosure items required by Part III of Form 10-K and 10-KSB. See General Instruction E(3) to Form 10-KSB and General Instruction G(3) to Form 10-K. See Section II. A.4 above. See, for example, the CII Letter, the SWIB Letter and the TIAA-CREF Letter. Other commenters suggested that we require registrants to file copies of all equity compensation plans (whether or not approved by security holders). See the ABA Letter and the NYSE Letter. 17 CFR 229.601(b)(10). 17 CFR 229.601(b)(10)(iii)(A). Nondiscriminatory, broad-based compensatory plans, contracts or arrangements are exempt from this requirement. See Item 601(b)(10)(iii)(B)( 4 ) 17 CFR 229.601(b)(10)(iii)(B)( 4 ). See, for example, the CII Letter and the Letter dated March 29, 2001 from the Office of the State Comptroller of the State of New York. See new Item 601(b)(10)(iii)(B) of Regulation S-B 17 CFR 228.601(b)(10)(iii)(B) and new Item 601(b)(10)(iii)(B) of Regulation S-K 17 CFR 229.601(b)(10)(iii)(B). This is consistent with our action in 1981 amending then-Item 7 of Regulation S-K to reformulate the definition of quotmaterial contractsquot as applied to remunerative plans, contracts or arrangements. See Release No. 33-6287 (Feb. 6, 1981) 46 FR 11952. Previously, we had indicated that remuneration plans in which directors or executive officers of the registrant did not participate generally did not need to be filed as exhibits. See Release No. 33-6230, Section II. A.2.b. i. (Aug. 27, 1980) 45 FR 58822. With respect to an existing non-security holder-approved equity compensation plan subject to new Item 601(b)(10)(iii)(B) of Regulation S-B or new Item 601(b)(10)(iii)(B) of Regulation S-K that is in effect as of the effective date of these amendments and that has not been filed previously, a copy of the plan must be filed as an exhibit to the annual report on Form 10-K or 10-KSB filed by the registrant for its first fiscal year ending on or after March 15, 2002. 44 U. S.C. sect3501 et seq . Publication and submission were in accordance with 44 U. S.C. sect3507(d) and 5 CFR 1320.11. The titles for the collections of information affected by the amendments are (1) quotRegulation 14A (Commission Rules 14a-1 through 14b-2 and Schedule 14A),quot (2) quotRegulation 14C (Commission Rules 14c-1 through 14c-7 and Schedule 14C),quot (3) quotForm 10-K, quot (4) quotForm 10- KSB, quot (5) quotRegulation S-Bquot and (6) quotRegulation S-K. quot The likely respondents subject to the collections of information include entities whose reporting obligations arise under the Exchange Act. The reporting requirements of Section 13 of the Exchange Act 15 U. S.C. sect78m, as well as the proxy disclosure requirements of Section 14 of the Exchange Act, apply to entities that have securities registered under Section 12 of the Exchange Act 15 U. S.C. sect78 l . The reporting requirements of Section 15(d) of the Exchange Act apply to entities with effective registration statements under the Securities Act that are not otherwise subject to the registration requirements of Section 12 of the Exchange Act. See the Letter dated April 17, 2001 from the American Institute of Certified Public Accountants (the quotAICPA Letterquot), the Letter dated April 2, 2001 from the Association of Publicly-Traded Companies (the quotAPTC Letterquot), the Letter dated April 2, 2001 from Lucent Technologies Inc. (the quotFirst Lucent Letterquot), the Letter dated May 22, 2001 from the New York State Bar Association, the Letter dated August 17, 2001 from Leonard S. Stein (the quotStein Letterquot) and the Letter dated August 26, 2001 from Hendrick Vater. See the Letter dated April 9, 2001 from Lucent Technologies Inc. See the APTC Letter. See the Stein Letter. We have changed our assumption about the number of registrants with equity compensation plans that, in any year, either adopt a new plan or amend an existing plan to increase the number of securities authorized for issuance under the plan. In the Proposing Release, we estimated that 50 of the registrants with equity compensation plans would either adopt a new plan or amend an existing plan each year. Based on the available survey data, we have revised this assumption to 30. See n. 91 below. This estimate is made after a review of available survey data, which varies widely. For example, in its most recent study of the quotSampP Super 1,500quot (the combination of the SampP 500, the SampP MidCap 400 and the SampP SmallCap 600), the Investor Responsibility Research Center determined that, of the 1,157 companies examined, 1,142 (98.7) awarded equity to some portion of their employees. See Investor Responsibility Research Center, Potential Dilution - 2000, The Potential Dilution from Stock Plans at the SampP Super 1,500 Companies (2000). In contrast, a Pilot Survey conducted by the Bureau of Labor Statistics in 1999 determined that 22 of publicly-held companies offered stock options to their employees. This survey sampled 2,100 quotestablishments, quot of which approximately 1 in 10 were publicly-held companies. See Bureau of Labor Statistics, Pilot Survey on the Incidence of Stock Options in Private Industry in 1999 . (Oct. 11, 2000), available at bls. govncsocsspncnr0001.txt. Further, in the Proposing Release we sought comment as to whether our estimates of the burden of the proposed collections of information were accurate. We received no comment letters responding to that request. Because of variations in the available data, we also have estimated the reporting and cost burdens for the proposed collections of information assuming that 98 of the registrants that file annual reports on Form 10-K or 10-KSB maintain an equity compensation plan and are subject to the required disclosure. See nn. 108 and 110 below. Based on the actual number of registrants filing annual reports on Form 10-K and 10-KSB, we estimate that 6,229 registrants that file on Form 10-K (10,381 times 60) maintain equity compensation plans (quotForm 10-K Filersquot) and 2,185 registrants that file on Form 10-KSB (3,641 times 60) maintain equity compensation plans (quotForm 10-KSB Filersquot). In the Proposing Release, we estimated that this figure was 25. The available survey data does not appear to be representative of the general registrant population. See William M. Mercer, Inc. Equity Compensation Survey (2001) (48 of survey respondents (83 participants) maintained non-security holder-approved stock option plans for employees below management level 60 of such plans most prevalent in large companies (more than 5,000 employees)) iQuantic, Inc. Trends in Equity Compensation 1996-2000 (2000) (27.3 of survey respondents in 1999 (161 participants) maintained non-security holder-approved stock option plans, compared to 3.2 before 1996). After discussions with several compensation professionals, we reduced our estimate to 20. We estimate that of the Form 10-K Filers, 1,246 (6,229 times 20) maintain a non-security holder-approved equity compensation plan (quotForm 10-K Filers with Non-Approved Plansquot) and 4,983 (6,229 times 80) do not (quotForm 10-K Filers with Only Approved Plansquot). We estimate that of the Form 10-KSB Filers, 437 (2,185 times 20) maintain a non-security holder-approved equity compensation plan (quotForm 10-KSB Filers with Non-Approved Plansquot) and 1,748 (2,185 times 80) do not (quotForm 10-KSB Filers with Only Approved Plansquot). This estimate is based on a review of available survey data. In its most recent study, the Investor Responsibility Research Center determined that, of 1,157 companies studied in calendar year 2000, 337 (29) presented proposals for new or amended equity compensation plans to security holders. See Investor Responsibility Research Center, Potential Dilution - 2000, The Potential Dilution from Stock Plans at the SampP Super 1,500 Companies (2000). In its most recent study, Pearl Meyers amp Partners found that new plan authorizations among the top 200 companies were submitted by 58 companies in 2000 (29). See Pearl Meyers amp Partners, Inc. 2000 Equity Stake, Study of Management Equity Participation in the Top 200 Corporations (2000). We estimate that of the Form 10-K Filers with Only Approved Plans, 1,495 (4,983 times 30) submit a new or amended equity compensation plan for security holder approval annually (quotForm 10-K Filers with Only Approved Plans Subject to Section 14quot) and of the Form 10-K Filers with Non-Approved Plans, 374 (1,246 times 30) submit a new or amended equity compensation plan for security holder approval annually (quotForm 10-K Filers with Non-Approved Plans Subject to Section 14quot). Similarly, we estimate that of the Form 10-KSB Filers with Only Approved Plans, 524 (1,748 times 30) submit a new or amended equity compensation plan for security holder approval annually (quotForm 10-KSB Filers with Only Approved Plans Subject to Section 14quot) and of the Form 10-KSB Filers with Non-Approved Plans, 131 (437 times 30) submit a new or amended equity compensation plan for security holder approval annually (quotForm 10-KSB Filers with Non-Approved Plans Subject to Section 14quot). This estimate is based on a comparison of the actual number of registrants filing annual reports on Form 10-K or 10-KSB during the 2000 fiscal year (10,381 3,641 14,022) with the actual number of registrants filing proxy or information statements during the 2000 fiscal year (9,892 253 10,145), or 10,14514,022. Thus, we have subtracted 419 registrants (1,495 times 28) from the group of Form 10-K Filers with Only Approved Plans Subject to Section 14, 105 registrants (374 times 28) from the group of Form 10-K Filers with Non-Approved Plans Subject to Section 14, 147 registrants (524 times 28) from the group of Form 10-KSB Filers with Only Approved Plans Subject to Section 14 and 37 registrants (131 times 28) from the group of Form 10-KSB Filers with Non-Approved Plans Subject to Section 14. This estimate is based on a comparison of the actual number of registrants filing proxy statements during the 2000 fiscal year (9,982) with the actual number of registrants filing information statements during the same period (253), or 9,98210,145. Thus, we estimate that of the 1,076 Form 10-K Filers with Only Approved Plans Subject to Section 14, 1,054 (1,076 times 98) will file proxy statements and 22 will file information statements, of the 269 Form 10-K Filers with Non-Approved Plans Subject to Section 14, 264 (269 times 98) will file proxy statements and five will file information statements, of the 377 Form 10-KSB Filers with Only Approved Plans Subject to Section 14, 369 (377 times 98) will file proxy statements and eight will file information statements and of the 94 Form 10-KSB Filers with Non-Approved Plans Subject to Section 14, 92 (94 times 98) will file proxy statements and two will file information statements. Even though we have streamlined compliance in order to reduce the burden on registrants, we have not reduced the number of estimated burden hours to prepare the required disclosure. This decision is in response to comments that our initial burden hour estimate was too low. See the AICPA Letter and the First Lucent Letter. We estimate that registrants will prepare 50 of the required disclosure and outside counsel will prepare the remaining 50. Accordingly, this estimate reflects the addition of one burden hour to prepare the required tabular disclosure. See n. 97 above and the accompanying text. We estimate that registrants will prepare 50 of the required disclosure and outside counsel will prepare the remaining 50. Accordingly, this estimate reflects the addition of two burden hours to prepare the required tabular and narrative disclosure. See n. 97 above and the accompanying text. We arrived at this estimate by taking the number of Form 10-K Filers (see n. 88 above) and subtracting (a) the number of Form 10-K Filers with Non-Approved Plans (see n. 90 above) and (b) the number of Form 10-K Filers with Only Approved Plans Subject to Section 14 (see nn. 92 and 94 above), or (6,229 - 1,246 - 1,076). We arrived at this estimate by taking the number of Form 10-K Filers with Non-Approved Plans (see n. 90 above) and subtracting the number of Form 10-K Filers with Non-Approved Plans Subject to Section 14 (see nn. 92 and 94 above), or (1,246 - 269). We arrived at this estimate by taking the number of Form 10-KSB Filers (see n. 88 above) and subtracting (a) the number of Form 10-KSB Filers with Non-Approved Plans (see n. 90 above) and (b) the number of Form 10-KSB Filers with Only Approved Plans Subject to Section 14 (see nn. 92 and 94 above), or (2,185 - 437 - 377). We arrived at this estimate by taking the number of Form 10-KSB Filers with Non-Approved Plans (see n. 90 above) and subtracting the number of Form 10-KSB Filers with Non-Approved Plans Subject to Section 14 (see nn. 92 and 94 above), or (437 - 94). We arrived at this estimate by taking the number of Form 10-K Filers with Only Approved Plans Subject to Section 14 that will file proxy statements and adding the number of Form 10-KSB Filers with Only Approved Plans Subject to Section 14 that will file proxy statements (see n. 96 above), or (1,054 369). We arrived at this estimate by taking the number of Form 10-K Filers with Non-Approved Plans Subject to Section 14 that will file proxy statements and adding the number of Form 10-KSB Filers with Non-Approved Plans Subject to Section 14 that will file proxy statements (see n. 96 above), or (264 92). We arrived at this estimate by taking the number of Form 10-K Filers with Only Approved Plans Subject to Section 14 that will file information statements and adding the number of Form 10-KSB Filers with Only Approved Plans Subject to Section 14 that will file information statements (see n. 96 above), or (22 8). We arrived at this estimate by taking the number of Form 10-K Filers with Non-Approved Plans Subject to Section 14 that will file information statements and adding the number of Form 10-KSB Filers with Non-Approved Plans Subject to Section 14 that will file information statements (see n. 96 above), or (5 2). Assuming that 98 of the registrants that file annual reports on Form 10-K or 10-KSB maintain an equity compensation plan and are subject to the required disclosure, the estimated burden hours per year resulting from the amendments would be 16,511 hours, increasing this estimate to 5,735,343 hours. One-half of the total burden resulting from the amendments is reflected as burden hours and the remainder is reflected in the total cost of complying with the information collection requirements. We have used an estimated hourly rate of 300.00 to determine the estimated cost to respondents of the disclosure prepared by outside counsel. We arrived at this hourly rate estimate after consulting with several private law firms. These cost burden increases reflect a change in our assumption of the number of registrants with equity compensation plans that either adopt a new plan or amend an existing plan to increase the number of securities authorized for issuance under the plan (see n. 85 above) and a change in the estimated hourly rate of outside counsel. With respect to Forms 10-K and 10-KSB, we increased our estimate by 937,300 in the case of Form 10-K and increased our estimate by 483,100 in the case of Form 10-KSB. With respect to Schedules 14A and 14C, we decreased our estimate by 8,089,500 in the case of Schedule 14A and decreased our estimate by 209,800 in the case of Schedule 14C. Assuming that 98 of the registrants that file annual reports on Form 10-K or 10-KSB maintain an equity compensation plan and are subject to the required disclosure, the estimated cost burden per year resulting from the amendments would be 4,946,400. Comments are requested pursuant to 44 U. S.C. sect3506(c)(2)(B). A study of stock-based pay practices at the nations 200 largest corporations indicates that these companies allocated 15.2 of outstanding shares (calculated on a fully-diluted basis) for management and employee equity incentives in 2000, compared to only 6.9 in 1989. See Pearl Meyers amp Partners, Inc. 2000 Equity Stake, Study of Management Equity Participation in the Top 200 Corporations (2000). Both the size of individual awards and the number of companies that use equity broadly throughout the organization have increased significantly. See Core, Guay and Larcker, Executive Equity Compensation and Incentives: A Survey . Working Paper, University of Pennsylvania (2001), at 5-7. This question should be considered in the context of any open market stock repurchase program that has been instituted by a registrant. Repurchases by its own securities by a registrant under such a program may mitigate the dilutive effects of the registrants equity compensation program. There is evidence that companies with high levels of dilution earn lower market-adjusted returns in future periods than companies with comparatively lower levels of dilution. See Garvey and Milbourn, Do Stock Prices Incorporate the Potential Dilution of Employee Stock Options . Working Paper, Claremont Graduate University amp Washington University in St. Louis (2001), at 2-3. But see Core, Guay and Larcker, Executive Equity Compensation and Incentives: A Survey . Working Paper, University of Pennsylvania (2001) (discussing the difficulty in documenting a relationship between equity compensation and corporate performance). See Release No. 34-41479 (June 4, 1999) 64 FR 31667 (under NYSE listing standards, security holder approval not required if plan is quotbroadly-basedquot that is, at least a majority of the registrants full-time employees are eligible to participate and at least a majority of the shares underlying options actually granted are to employees who are not officers or directors) Release No. 34-37260 (May 31, 1996) 61 FR 30376 (security holder approval requirement of Exchange Act Rule 16b-3 17 CFR 240.16b-3 eliminated). See also the Proposing Release at n. 21. According to the Investor Responsibility Research Center, the average negative vote on stock option plans submitted for security holder action in 2000 was 20.7, up from 17.4 in 1997. In addition, in 2000 a relatively large number of stock plan proposals were rejected. See Investor Responsibility Research Center, Potential Dilution - 2000, The Potential Dilution from Stock Plans at the SampP Super 1,500 Companies (2000) (the quotIRRC Dilution Studyquot). See Gillan, Option-based Compensation: Panacea or Pandoras Box . Journal of Applied Corporate Finance (2001) 115-128. Our rules require proxy statement disclosure of the material features of a compensation plan being submitted for security holder action. See Item 10(a)(1) of Schedule 14A. This disclosure does not reach a plan that is never submitted for security holder action. While Item 402(c) of Regulation S-B 17 CFR 228.402(c) and Item 402(c) of Regulation S-K 17 CFR 229.402(c) require disclosure of the number of stock options granted during the last fiscal year, this disclosure only covers the named executive officers of the registrant (as defined in the item). See also Item 402(b)(2)(iv)(B) of Regulation S-B 17 CFR 228.402(b)(2)(iv)(B) and Item 402(b)(2)(iv)(B) of Regulation S-K 17 CFR 229.402(b)(2)(iv)(B). Although financial reporting disclosure requirements concerning stock-based compensation are extensive, they do not require the identification of non-security holder-approved equity compensation plans. See paragraph 46 of Statement of Financial Accounting Standards No. 123, Accounting for Stock-Based Compensation (Oct. 1995) (quotSFAS 123quot). Given its recent comprehensive project on accounting for stock-based compensation and its current lengthy agenda, it is not expected that the FASB will revisit this subject in the immediate future. Thus, it is unlikely that the FASB could address this matter through a technical enhancement of its disclosure requirements in the near term. See the Proposing Release at n. 17. See also the Letter dated October 16, 2001 from Sarah A. B. Teslik, Executive Director, Council of Institutional Investors to Jonathan G. Katz. Certain equity awards, such as stock bonuses and restricted stock purchases for a nominal price, may, in some situations, be more dilutive from an economic standpoint than options, warrants and rights. While the amendments apply to all types of equity compensation, for two reasons our discussion focuses primarily on stock options. First, they represent the most popular form of equity compensation used today. It is estimated that more than 80 of the securities reserved for conversion and exercise by U. S. registrants relate to stock options. See Huson, Scott and Wier, Earnings Dilution and the Explanatory Power of Earnings for Returns . The Accounting Review (2001). Second, most alternative forms of equity compensation involve issued securities. Consequently, their dilutive effect may already have occurred and is likely to be reflected in the basic earnings-per-share computation and security holders equity data. These commenters included seven individual and institutional investors, four registrants and registrant associations, one self-regulatory organization and 10 members of the executive compensation consulting, accounting and legal communities. See, for example, the Letter dated April 2, 2001 from Arthur Andersen LLP (the quotAA Letterquot), the Letter dated April 17, 2001 from the American Institute of Certified Public Accountants (the quotAICPA Letterquot), the Letter dated March 29, 2001 from Emerson Electric Co. the Letter dated April 12, 2001 from Microsoft Corporation and the Letter dated April 2, 2001 from PricewaterhouseCoopers LLP (the quotPWC Letterquot). See, for example, the Letter dated March 29, 2001 from Ernst amp Young LLP and the Letter dated April 2, 2001 from Lucent Technologies Inc. See Section II. C above. Available information on non-security holder-approved stock option plans is sparse. See William M. Mercer, Inc. Equity Compensation Survey (2001) (48 of survey respondents (83 participants) maintained non-security holder-approved stock option plan for employees below management level such plans (60) most prevalent in large companies (more than 5,000 employees) iQuantic, Inc. Trends in Equity Compensation 1996-2000 (2000) (27.3 of survey respondents in 1999 (161 participants) maintained non-security holder-approved stock option plans, compared to 3.2 before 1996). This measure may be formulated in different ways. For purposes of this discussion, quotoverhangquot means the sum of the number of securities underlying outstanding options, warrants and rights plus the number of securities remaining available for future issuance under the registrants existing equity compensation plans, and is often expressed as a percentage of the total number of outstanding securities. It may be difficult for investors to calculate the quotoverhangquot of a registrants equity compensation p rogram because the number of securities available for future issuance under the registrants plans may not be disclosed or apparent. Currently, a registrant submitting an equity compensation plan for security holder action need not provide any specific disclosure about its other equity compensation plans. Moreover, in its annual study on stock plan dilution, the Investor Responsibility Research Center found that approximately 22 of the companies surveyed did not disclose the number of shares available for future issuance under their employee stock plans. See the IRRC Dilution Study. While the full dilutive impact of these authorized but unissued securities cannot be assessed until derivative instruments have been granted and the prices for which the underlying securities may be issued can be compared to existing market values, this information, combined with knowledge of the minimum exercise price at which these instruments may be granted, may provide useful insight into the potential future economic consequences of the program. See, for example, the AA Letter, the AICPA Letter, the Letter dated May 22, 2001 from the New York State Bar Association and the PWC Letter. See the ABA Letter. This estimate is based on the Letter dated April 9, 2001 from Lucent Technologies, Inc. in which the commenter estimated that providing four additional pages of disclosure to its over five million security holders would result in additional printing costs of 100,000 and additional mailing costs of 200,000. Assuming that the required disclosure consists of one additional page and that a registrant has 50,000 security holders, the registrant may incur additional costs of 750 to prepare and distribute the additional disclosure. Since all registrants are required to make the same disclosure, the amendments will impose the same dollar costs on each registrant. Accordingly, for small entities the relative burden of compliance will be higher than for large entities. This figure is based on our estimate that 60 of the actual number of registrants filing annual reports on Form 10-K or 10-KSB (14,022 registrants) maintain equity compensation plans. This estimate is made after a review of available survey data, which varies widely. For example, in its most recent study of the quotSampP Super 1,500quot (the combination of the SampP 500, the SampP MidCap 400 and the SampP SmallCap 600), the Investor Responsibility Research Center determined that, of the 1,157 companies examined, 1,142 (98.7) awarded equity to some portion of their employees. See Investor Responsibility Research Center, Potential Dilution - 2000, The Potential Dilution from Stock Plans at the SampP Super 1,500 Companies (2000). In contrast, a Pilot Survey conducted by the Bureau of Labor Statistics in 1999 determined that 22 of publicly-held companies offered stock options to their employees. This survey sampled 2,100 quotestablishments, quot of which approximately 1 in 10 were publicly-held companies. See Bureau of Labor Statistics, Pilot Survey on the Incidence of Stock Options in Private Industry in 1999 . (Oct. 11, 2000), available at bls. govncsocsspncnr0001.txt. We arrived at this estimate by assuming that approximately 80 of these registrants will be required to provide the tabular disclosure only and 20 of these registrants will be required to describe the material features of their non-security holder-approved plans as well. See n. 90 above and the accompanying text. Thus, 80 of the registrants will incur an average annual outside counsel cost of 300 (80 of 8,400 times 300 2,016,000) while 20 will incur an average annual outside cost of 600 (20 of 8,400 times 600 1,008,000). In addition, we estimate that approximately 365 registrants with non-security holder-approved plans will incur additional printing and distribution costs of 750 each, or 273,750. See n. 135 above. The sum of these amounts averaged over 8,400 registrants equals 393. A recent study of approximately 250 companies conducted by the National Center for Employee Ownership found that 55 of the respondents had less than 200 employees (with 17 having less than 31 employees) and that 55 of the respondents had less than 40 million in annual revenue (with 14 having annual revenues of 1.1 million or less). See National Center for Employee Ownership, An Overview of How Companies are Granting Stock Options (2001). See the Proposing Release at Section V.
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