By Cydney Posner

Corporate Counsel is reporting that, with regard to SEC comments in connection with its targeted reviews of executive compensation disclosures, the Staff is now using two types of letters to "clear" these reviews. There's the standard "all clear," and then a variation stating that the Staff "neither agrees or disagrees" with the company's exclusion of performance targets. Corporate Counsel advises that the modified letter "leaves the door open for the Staff to challenge the exclusion at a later date. However, a company that receives this type of letter can consider the Staff's review complete" and no longer outstanding for purposes of 10-K disclosure. The modified letter reads something like this: "Without more detail, we cannot agree or disagree with your conclusion that you have an appropriate basis for excluding your [performance] targets. Since you are in possession of all of the facts related to your disclosure, we have decided that we have no basis to disagree with your decision to omit information from your filing. As in all cases, we remind you that you are responsible for the adequacy and accuracy of the disclosure in your filings. We do not have any further comments on your filing."

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