On October 11, 2017, the Securities and Exchange Commission (SEC) proposed amendments to Item 601 of Regulation S-K that would permit companies to omit confidential information from material contracts filed pursuant to Item 601(b)(10) that is both (i) not material and (ii) competitively harmful if publicly disclosed, without the filing of a Confidential Treatment Request (CTR).
Under the proposed amendments, companies would continue to mark the exhibit index of a filing to indicate the portions of any exhibit where confidential information has been redacted, indicate on the first page of such exhibit that certain confidential information has been redacted, and include brackets to indicate where the redacted information was removed within the filed material contract. However, this proposal would amend the current SEC procedure, which requires concurrent submission of a CTR along with an unredacted version of the material contract to the SEC's Division of Corporation Finance for review and comment. Currently, each CTR is reviewed by the SEC to assess the materiality and competitive harm of the redacted information and to confirm the appropriateness of confidential treatment of such information.
The SEC would continue to conduct its selective review of companies' filings and would selectively assess the appropriateness of any redacted information. If selected for review, a company would be expected to produce supplemental materials to support any redactions in the same manner as currently required in a CTR.
The SEC has also proposed to amend Item 601 to codify a current policy of the Division of Corporation Finance that allows for the redaction of personally identifiable information (such as bank account numbers, addresses or Social Security numbers) from material contracts filed pursuant to Item 601, without the filing of a CTR.
These proposed amendments are being made pursuant to Section 72003 of the Fixing America's Surface Transportation Act (FAST Act), which requires the SEC to propose rules to modernize and simplify certain disclosure requirements in Regulation S-K.
If you have any questions or would like further information about the proposed SEC policy, please contact any member of the Lowenstein Sandler Capital Markets & Securities Practice.
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