Proposed Changes to Beneficial Ownership Reporting Rules and Impact to Stakeholders

On February 10, 2022, the Securities and Exchange Commission (“SEC”) proposed amendments to the rules governing reporting on Schedules 13D and 13G. These proposed amendments are intended to modernize the rules by, among other things, making information available to the public in a more timely manner, deeming holders of certain cash-settled derivative securities to be beneficial owners of the reference equity securities, and clarifying the disclosure requirements in respect of derivative securities. However, the proposed amendments have broader impacts.

During our session, panelists will discuss:

• Proposed changes that would shorten multiple filing deadlines for Schedules 13D and 13G,
• Proposed amendments to the definition of beneficial ownership to include certain cash-settled derivatives, other than security-based swaps,
• Proposed method for calculating reference securities underlying cash-settled derivatives,
• Proposed amendments that would clarify the disclosure requirements with respect to derivative securities,
• The relationship of these proposed amendments to the SEC’s proposed Rule 10B-1, which would require public reporting of, among other things, certain large positions in security-based swaps,
• Proposed amendments to clarify when persons are deemed to “act as” a group under Sections 13(d)(3) and (g)(3) of the Exchange Act and exemptions,
• The effect of the proposed amendments to the beneficial ownership definition on Section 16 filing requirements, and
• The effect on activist interest and strategies and ongoing private transactions.

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