As mentioned in a previous post, the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Dodd-Frank Act”) includes new requirements for “say-on-pay” and “say-on-golden parachute” shareholder votes. On October 18, 2010, the U.S. Securities and Exchange Commission (the “SEC”) published proposed rules to facilitate the implementation of these new requirements: SEC Release No. 33-9153. The proposed rules are open for comment until November 18, 2010.

The “say-on-pay” shareholder advisory vote to approve executive compensation would be required at least once every three years, and would be included in any proxy statement for an annual or other meeting of shareholders held on or after January 21, 2011. There would also be a shareholder advisory vote required at least once every six years regarding the frequency of the say-on-pay vote (a “say-on-frequency” vote). “Say-on-golden parachute” shareholder advisory votes would be required in connection with a shareholders’ meeting at which shareholders are asked to approve an acquisition, merger, consolidation or a sale or all or substantially all of a company’s assets. These “say-on-golden parachute” rules, including certain new rules governing the disclosure of such executive compensation arrangements or understandings, will not apply until the proposed SEC rules are made effective.

The foregoing rules also will not apply to Canadian companies that are “foreign private issuers” under applicable U.S. law.