On October 15, 2026, the staff of the Division of Corporation Finance published six new and two revised Corporation Finance Interpretations (CFIs) addressing equity compensation and benefit-plan registration. Collectively, the CFIs ease several longstanding staff positions and reduce uncertainty regarding issues that have complicated the registration of the offer and sale of stock underlying equity awards, particularly the timing of registration for restricted stock and restricted stock units (RSUs), the treatment of assumed awards held by former employees of acquired companies, and the treatment of restricted stock and RSUs granted prior to a company’s initial public offering.[1] A separate new CFI addresses the calculation of Form 4 deadlines by reference to the time zone in which the transactions were executed on a non-U.S. exchange.
The CFIs include the following significant developments:
- Restricted stock and RSU awards may be covered by a Form S-8 filed by the vesting date of the awards, as long as the company was eligible to use Form S-8 at the time of grant. With new CFI 126.47, the staff clarified an area of uncertainty by explicitly stating that it will not object if reporting companies register the offer and sale of shares issued upon settlement, as long as the registration statement is filed by the vesting date and the company was eligible to use Form S-8 at the time of grant (see the discussion below regarding CFI 271.28 for newly public companies).
This interpretation adds flexibility for companies issuing awards that are not already covered by Form S-8, such as inducement awards granted to new hires and other stand-alone grants outside of an equity compensation plan. It should also help companies that grant awards from a newly approved plan, or from an annual “evergreen” share increase, before filing the related Form S-8. Companies should note that this CFI does not change the timing of any stockholder approval requirement imposed by the relevant stock exchange, which may limit when awards can be granted. Moreover, companies relying on the interpretation should closely monitor the awards’ vesting conditions to ensure a Form S-8 is on file before the vesting conditions are met, including where vesting may be accelerated, such as upon a change in control or a qualifying termination, and for performance-based awards without a fixed vesting date. Lastly, companies with deferred-settlement RSUs should note that the Form S-8 must be on file prior to vesting, and not just settlement, of the RSUs.
- Securities issuable in connection with assumed outstanding compensatory awards of an acquired company’s former employees may be covered by a Form S-8 filed by the acquiror. Revised CFI 126.14 replaces a prior staff interpretation that prevented use of Form S-8 for shares underlying assumed outstanding options held by an acquired company’s former employees, noting that the staff will not object to the use of Form S-8. As a result of this revised CFI, companies contemplating acquisitions will have the flexibility to use Form S-8 for securities issuable under assumed former employee compensatory awards, instead of having to rely on other alternatives, such as separate Form S-3 registration, cashing out or terminating the awards, or instituting pre-closing exercise windows.
- Private company acquirors eligible for Rule 701 may rely on the exemption with respect to compensatory awards assumed by the acquiror and held by former employees of the acquired company. New CFI 271.29 parallels CFI 126.14 discussed above by permitting private company acquirors assuming compensatory awards of former employees to rely on the exemption from registration in Rule 701 for the offer and sale of the restricted stock or securities underlying stock options and RSUs, as long as the acquiror is itself eligible for the exemption.
- Newly public companies may use Form S-8 to register the offering of shares issuable in connection with compensatory awards made while still a private company. With new CFI 271.28, companies going public and filing a Form S-8 may include in the registration statement restricted stock subject to vesting and shares underlying outstanding options and RSUs previously granted to eligible recipients. Companies going public should benefit from the speed and ease of filing a registration statement on Form S-8 to cover such securities.
- Filing fees paid for securities underlying forfeited compensatory awards may be applied to future Form S-8 registrations. Under new CFI 126.46, if an issuer registered on Form S-8 securities underlying awards with vesting conditions, paid the associated fees, and the awards were later forfeited prior to vesting, the staff will not object if the issuer applies the fees associated with the forfeited awards to future registration of securities underlying the awards, including securities that became available for reissuance under the plan. Companies should note that this interpretation addresses the fee only, and contemplates a future registration of securities that become available for reissuance under the plan.
- For 401(k) plans whose offerings of employer securities must be registered on Form S-8, registration fees will only be required for employee contributions and matching contributions by the employer to the extent they are invested in the employer’s securities. . Revised CFI 126.19 clarifies that a registration fee is required for employee contributions and matching employer contributions only to the extent those contributions are invested in the employer’s securities. In addition, the staff clarified that registration is required for an indeterminate amount of plan interests which are securities of the plan, but no separate fee is required with respect to the plan interests.
The staff also issued new CFI 240.19 clarifying that issuers may calculate registration fees for offerings pursuant to defined contribution plans based on maximum aggregate offering price, as described in Rule 457(o).
- For transactions taking place on a foreign exchange, the two-business-day Form 4 deadline is calculated beginning with the date in the time zone where a transaction was executed, and the filing deadline is based on U.S. Eastern Time. New CFI 135.05 discusses the timing of Form 4 deadlines when transactions occur in a different time zone from U.S. Eastern Time. The CFI contemplates a transaction that took place on August 25, 2026, at 9:00 a.m. local time (when it is August 24, 2026, in U.S. Eastern Time). The Form 4 deadline counting begins with the date in the time zone where the transaction was executed (August 25, 2026), and therefore the deadline would be August 27, 2026. Because the filing is based on U.S. Eastern Time, the Form 4 is required to be filed by 10:00 p.m. Eastern Time on August 27, 2026.
The staff’s interpretation is likely to provide clarity to officers and directors of foreign private issuers who recently became subject to Section 16(a) reporting requirements and are not subject to an exemption.
For more information on these new and revised CFIs, please contact any member of Wilson Sonsini’s Public Company Representation, Capital Markets, or Employee Benefits and Compensation practices.
[1]As a reminder, CFIs reflect the views of the staff of the Division of Corporation Finance; they are not rules, regulations, or statements of the Commission.
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