SEC Adopts Exemptions for Compensatory Employee Stock Options from Securities Exchange Act Registration
The Securities and Exchange Commission has adopted two new exemptions from the registration requirements of Section 12(g) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), for compensatory employee stock options. Previously, a company would be required to register employee stock options under Section 12(g) of the Exchange Act if, at the end of its most recently completed fiscal year, it had more than 500 holders of stock options and more than $10 million of assets. The new exemptions from registration under Section 12(g) of the Exchange Act are available to private companies that are not required to file periodic reports under the Exchange Act and to public companies that are required to file those reports, provided that, in each case, such companies satisfy certain conditions, which are summarized in this memorandum.