34940 Federal Register / Vol. 83, No. 142 / Tuesday, July 24, 2018 / Rules and Regulations 

Committee deliberations on all issues. 

Like all Committee meetings, the 

October 25, 2017, meeting was a public 

meeting, and all entities, both large and 

small, were able to express views on 

this issue. 

In accordance with the Paperwork 

Reduction Act of 1995 (44 U.S.C. 

chapter 35), the Order’s information 

collection requirements have been 

previously approved by OMB and 

assigned OMB No. 0581–0178, Specialty 

Crops Program. No changes are 

necessary in those requirements as a 

result of this action. Should any changes 

become necessary, they would be 

submitted to OMB for approval. 

This rule establishes salable 

quantities and allotment percentages for 

Class 1 (Scotch) spearmint oil and Class 

3 (Native) spearmint oil produced in the 

Far West during the 2018–2019 

marketing year. Accordingly, this rule 

imposes no additional reporting or 

recordkeeping requirements on either 

small or large Far West spearmint oil 

producers or handlers. As with all 

Federal marketing order programs, 

reports and forms are periodically 

reviewed to reduce information 

requirements and duplication by 

industry and public-sector agencies. As 

mentioned in the initial regulatory 

flexibility analysis, USDA has not 

identified any relevant Federal rules 

that duplicate, overlap, or conflict with 

this final rule. 

AMS is committed to complying with 

the E-Government Act, to promote the 

use of the internet and other 

information technologies to provide 

increased opportunities for citizen 

access to Government information and 

services, and for other purposes. 

A proposed rule concerning this 

action was published in the Federal 

Register on April 6, 2018 (83 FR 14766). 

Copies of the proposed rule were also 

mailed or sent via facsimile to all Far 

West spearmint oil handlers. Finally, 

the proposal was made available 

through the internet by USDA and the 

Office of the Federal Register. A 60-day 

comment period ending June 5, 2018, 

was provided for interested persons to 

respond to the proposal. No comments 

were received. 

A small business guide on complying 

with fruit, vegetable, and specialty crop 

marketing agreements and orders may 

be viewed at: http://www.ams.usda.gov/ 

rules-regulations/moa/small-businesses. 

Any questions about the compliance 

guide should be sent to Richard Lower 

at the previously mentioned address in 

the FOR FURTHER INFORMATION CONTACT

section. 

After consideration of all relevant 

material presented, including the 

information and recommendation 

submitted by the Committee and other 

available information, it is hereby found 

that this rule, will tend to effectuate the 

declared policy of the Act. 

List of Subjects in 7 CFR Part 985 

Marketing agreements, Oils and fats, 

Reporting and recordkeeping 

requirements, Spearmint oil. 

For the reasons set forth in the 

preamble, 7 CFR part 985 is amended as 

follows: 

PART 985—MARKETING ORDER 

REGULATING THE HANDLING OF 

SPEARMINT OIL PRODUCED IN THE 

FAR WEST 

■ 1. The authority citation for 7 CFR 

part 985 continues to read as follows: 

Authority: 7 U.S.C. 601–674. 

■ 2. Revise § 985.233 to read as follows: 

§ 985.233 Salable quantities and allotment 

percentages. 

The salable quantity and allotment 

percentage for each class of spearmint 

oil during the marketing year beginning 

on June 1, 2018, shall be as follows: 

(a) Class 1 (Scotch) oil—a salable 

quantity of 760,660 pounds and an 

allotment percentage of 35 percent. 

(b) Class 3 (Native) oil—a salable 

quantity of 1,307,947 pounds and an 

allotment percentage of 53 percent. 

§§ 985.234 and 985.235 [Removed] 

■ 3. Remove §§ 985.234 and 985.235. 

Dated: July 19, 2018. 

Bruce Summers, 

Administrator, Agricultural Marketing 

Service. 

[FR Doc. 2018–15788 Filed 7–23–18; 8:45 am] 

BILLING CODE 3410–02–P 

SECURITIES AND EXCHANGE 

COMMISSION 

17 CFR Part 230 

[Release No. 33–10520; File No. S7–17–18] 

RIN 3235–AM39 

Exempt Offerings Pursuant to 

Compensatory Arrangements 

AGENCY: Securities and Exchange 

Commission. 

ACTION: Final rule. 

SUMMARY: The Securities and Exchange 

Commission is adopting an amendment 

to its regulations under the Securities 

Act of 1933 (the ‘‘Securities Act’’), 

which provide an exemption from 

registration for securities issued by nonreporting companies pursuant to 

compensatory arrangements. As 

mandated by the Economic Growth, 

Regulatory Relief, and Consumer 

Protection Act (the ‘‘Act’’), the 

amendment revises a rule to increase 

from $5 million to $10 million the 

aggregate sales price or amount of 

securities sold during any consecutive 

12-month period in excess of which the 

issuer is required to deliver additional 

disclosures to investors. 

DATES:

Effective date: July 23, 2018. 

Comment date: Comments regarding 

the collection of information 

requirements within the meaning of the 

Paperwork Reduction Act of 1995 

should be received on or before August 

23, 2018. 

ADDRESSES: Comments may be 

submitted by any of the following 

methods: 

Electronic Comments 

• Use the Commission’s internet 

comment form (http://www.sec.gov/ 

rules/final.shtml); or 

• Send an email to rule-comments@

sec.gov. Please include File Number S7– 

xx–18 on the subject line; or 

• Use the Federal eRulemaking Portal 

(http://www.regulations.gov). Follow the 

instructions for submitting comments. 

Paper Comments 

• Send paper comments in triplicate 

to Brent J. Fields, Secretary, Securities 

and Exchange Commission, 100 F Street 

NE, Washington, DC 20549–1090. 

All submissions should refer to File 

Number S7–17–18. This file number 

should be included on the subject line 

if email is used. To help us process and 

review your comments more efficiently, 

please use only one method. The 

Commission will post all comments on 

the Commission’s internet website 

(http://www.sec.gov/rules/final.shtml). 

Comments are also available for website 

viewing and printing in the 

Commission’s Public Reference Room, 

100 F Street NE, Washington, DC 20549, 

on official business days between the 

hours of 10:00 a.m. and 3:00 p.m. All 

comments received will be posted 

without change; we do not edit personal 

identifying information from 

submissions. You should submit only 

information that you wish to make 

available publicly. 

FOR FURTHER INFORMATION CONTACT: 

Anne M. Krauskopf, Senior Special 

Counsel, and Adam F. Turk, Special 

Counsel, Office of Chief Counsel, 

Division of Corporation Finance, at 

(202) 551–3500. 

SUPPLEMENTARY INFORMATION: We are 

adopting an amendment to 17 CFR 


jstallworth on DSKBBY8HB2PROD with RULES
Federal Register / Vol. 83, No. 142 / Tuesday, July 24, 2018 / Rules and Regulations 34941 

1Unless otherwise noted, all references to 

statutory sections are to the Securities Act, and all 

references to rules under the Securities Act are to 

title 17, part 230 of the Code of Federal Regulations 

[17 CFR part 230]. 

2 15 U.S.C. 77a et seq. 

3Only issuers that are not subject to the reporting 

requirements of Section 13 [15 U.S.C. 78m] or 15(d) 

[15 U.S.C. 78o(d)] of the Securities Exchange Act of 

1934 (‘‘Exchange Act’’) and are not investment 

companies registered or required to be registered 

under the Investment Company Act of 1940 [15 

U.S.C. 80a–1 et seq.] are eligible to rely on Rule 701. 

4The rule applies to compensatory arrangements 

established by the issuer, its parents, its majorityowned subsidiaries and majority-owned 

subsidiaries of the issuer’s parent. 

5Public Law 115–174, 132 Stat. 1296 (2018). 

6 17 CFR 230.701(e). 

7Section 507 of the Act also requires that every 

five years we index for inflation such aggregate 

sales price or amount of securities sold to reflect the 

change in the Consumer Price Index for All Urban 

Consumers published by the Bureau of Labor 

Statistics, rounding to the nearest $1 million. 

8Concurrent with the adoption of this 

amendment to Rule 701, we are issuing a concept 

release requesting public comment on various other 

issues relating to Rule 701. See Release No. 33– 

10521 (Jul. 18, 2018). 

9These disclosures consist of: 

• A copy of the summary plan description 

required by the Employee Retirement Income 

Security Act of 1974 (‘‘ERISA’’) [29 U.S.C. 1104– 

1107] or, if the plan is not subject to ERISA, a 

summary of the plan’s material terms; 

• risk factors associated with investment in the 

securities under the plan or agreement; and 

• the financial statements required in an offering 

statement on Form 1–A [17 CFR 239.90] under 

Regulation A [17 CFR 230.251 through 230.263]. 

10See 5 U.S.C. 553(b). 

11 Id. 

12This finding also satisfies the requirements of 

5 U.S.C. 808(2), allowing the amendment to become 

effective notwithstanding the requirement of 5 

U.S.C. 801 (if a federal agency finds that notice and 

public comment are impractical, unnecessary, or 

contrary to the public interest, a rule shall take 

effect at such time as the federal agency 

promulgating the rule determines). The amendment 

also does not require analysis under the Regulatory 

Flexibility Act. See 5 U.S.C. 604(a) (requiring a final 

regulatory flexibility analysis only for rules 

required by the APA or other law to undergo notice 

and comment). 

13See 5 U.S.C. 553(d). 

14 Id. 

15 Id. 

16Section 2(b) of the Securities Act [15 U.S.C. 

77b(b)] requires the Commission, when engaging in 

rulemaking where it is required to consider or 

determine whether an action is necessary or 

appropriate in the public interest, to consider, in 

addition to the protection of investors, whether the 

action will promote efficiency, competition and 

capital formation. 

17See, e.g., Report of the Financial Services 

Committee of the House of Representatives to H.R. 

1343 (‘‘These exemptions assist privately-held 

companies that want to provide their employees 

with the option to purchase the company’s 

securities to increase employee ownership. . . . 

Rule 701 should be updated by raising the $5 

million threshold requirement because the 

disclosures make it more expensive for companies 

to compensate their employees with the company’s 

stock. In addition, these disclosure requirements 

put private companies at risk of disclosing 

confidential financial information.’’). 

18As the intent of this rulemaking is to 

implement the specific regulatory change mandated 

by Congress, this analysis focuses on the economic 

effects arising from that change. 

19As noted above, concurrent with the adoption 

of this amendment, we are issuing a concept release 

requesting public comment on various other issues 

relating to Rule 701. 

230.701 (Rule 701) 1 under the 

Securities Act.2

I. Background 

Rule 701 provides an exemption from 

the registration requirements of the 

Securities Act for offers and sales of 

securities under certain compensatory 

benefit plans or written agreements 

relating to compensation. The 

exemption covers securities offered or 

sold under a plan or agreement between 

a non-reporting company 3 and the 

company’s employees, officers, 

directors, partners, trustees, consultants, 

and advisors.4

II. Rule Amendment 

As mandated by Section 507 of the 

Act,5 we are amending Rule 701(e) 6 to 

increase from $5 million to $10 million 7

the aggregate sales price or amount of 

securities sold during any consecutive 

12-month period in excess of which the 

issuer is required to deliver additional 

disclosure to investors. As amended, 

Rule 701(e) will otherwise continue to 

operate in the same manner as it 

currently does.8 Specifically, the 

additional disclosures required by Rule 

701(e) 9 will not be required for sales up 

to $10 million in the 12-month period. 

If aggregate sales during that period 

exceed $10 million, however, the issuer 

must deliver those additional 

disclosures a reasonable period of time 

before the date of sale to all investors in 

the 12-month period. Issuers that have 

commenced an offering in the current 

12-month period will be able to apply 

the new $10 million disclosure 

threshold immediately upon 

effectiveness of the amendment. 

III. Procedural Matters 

The Administrative Procedure Act 

(‘‘APA’’) generally requires an agency to 

publish notice of a proposed rulemaking 

in the Federal Register and provide an 

opportunity for public comment.10 This 

requirement does not apply, however, if 

the agency ‘‘for good cause finds . . . 

that notice and public procedure are 

impracticable, unnecessary, or contrary 

to the public interest.’’ 11 As discussed 

above, Section 507 of the Act directs the 

Commission, not later than 60 days after 

the date of enactment, to amend Rule 

701(e) to increase from $5 million to $10 

million the aggregate sales price or 

amount of securities sold during any 

consecutive 12-month period in excess 

of which the issuer is required to deliver 

additional disclosures to investors. 

Because the amendment is necessary to 

conform Rule 701(e) to the requirements 

of the Act, and involves no exercise of 

agency discretion, we find that notice 

and public comment are unnecessary.12

The APA also generally requires that an 

agency publish an adopted rule in the 

Federal Register 30 days before it 

becomes effective.13 This requirement, 

however, does not apply if the agency 

finds good cause for making the rule 

effective sooner.14 For the same reasons 

as we are forgoing notice and comment, 

we find good cause to make the rules 

effective immediately upon publication 

in the Federal Register. In addition, we 

find that the amendment relieves a 

restriction in our rules.15

IV. Economic Analysis 

We are mindful of the costs imposed 

by and the benefits obtained from our 

rules and amendments.16 The 

discussion below addresses the 

potential economic effects of the 

amendment, including the likely 

benefits and costs. The Commission is 

adopting an amendment to implement 

the specific statutory mandate of 

Section 507 of the Act. The legislative 

history suggests that Section 507 of the 

Act was intended to address two 

concerns with the existing $5 million 

threshold for requiring additional 

disclosure. Namely, that the additional 

disclosure makes it more expensive for 

companies to compensate their 

employees with the company’s stock 

and that this disclosure puts nonreporting companies at risk of disclosing 

confidential financial information.17 By 

increasing the threshold from $5 million 

to $10 million, we believe that Congress 

intended to alleviate some of these 

concerns. The costs and benefits of this 

amendment stem entirely from the 

statutory mandate of Section 507.18 In 

addition, given that the amendment 

implements a statutory mandate and 

involves no exercise of agency 

discretion, we believe there are no 

reasonable alternatives to the 

amendment.19

A. Baseline 

The baseline for our economic 

analysis is the disclosure requirement of 

Item 701(e) prior to the amendment 

being adopted, which required an issuer 

to deliver additional disclosures to 

investors if the aggregate sales price or 

amount of securities sold during any 

consecutive 12-month period exceeded 

$5 million. The amendment will affect 

non-reporting companies that rely on 

Rule 701 to offer securities to plan 


jstallworth on DSKBBY8HB2PROD with RULES
34942 Federal Register / Vol. 83, No. 142 / Tuesday, July 24, 2018 / Rules and Regulations 

20Based on staff analysis of EDGAR filings in 

calendar year 2017, there were approximately 

15,960 non-reporting operating companies 

conducting Regulation D offerings. In addition, 

there were 88 newly qualified offerings under 

Regulation A during calendar year 2017, excluding 

post-qualification amendments and withdrawn 

offerings. Finally, 443 non-reporting companies 

conducted offerings solely under Regulation 

Crowdfunding in 2017 (companies conducting both 

Regulation D and Regulation Crowdfunding 

offerings in 2017 are included in the number for 

Regulation D offerings). 

21Based on a review of Regulation A offering 

statements, irrespective of the offering amount 

sought, the staff identified approximately seven 

cases of companies that disclosed unregistered 

securities sold in reliance upon Rule 701 in the past 

twelve months in Part I of Form 1–A; however, this 

would not account for companies that have 

conducted a Regulation A offering and 

subsequently have relied upon Rule 701 for 

unregistered sales. 

22 44 U.S.C. 3501 et seq. 

23 44 U.S.C. 3507(d) and 5 CFR 1320.11. 

participants pursuant to compensatory 

benefit plans. In particular, the 

amendment will affect non-reporting 

companies that issue, or seek to issue, 

between $5 million and $10 million in 

a 12-month period. Non-reporting 

companies that issue less than $5 

million or more than $10 million in a 

12-month period will not be affected by 

the amendment. The Commission lacks 

data on non-reporting companies that 

rely on, or seek to rely on, Rule 701 to 

offer securities pursuant to 

compensatory benefit plans. We can 

approximate the number of growth 

companies with external financing 

needs using data on companies 

conducting exempt securities offerings 

under Regulation D, Regulation A, and 

Regulation Crowdfunding. This group 

may be likely to rely on Rule 701 for the 

purpose of offering competitive 

compensation packages to attract and 

retain key individuals. Based on filings 

in 2017, we estimate there are 

approximately 16,491 non-reporting 

companies conducting exempt offerings 

of unregistered securities under the 

aforementioned exemptions.20 Some of 

these companies may currently be too 

small to offer securities in compensatory 

benefit plans that would fall in the $5 

million to $10 million range over a 12- 

month period, but could potentially be 

able to do so in the future if they 

successfully grow their businesses. We 

do not have access to equivalent data for 

non-reporting foreign private issuers, 

who also can rely on Rule 701 to offer 

securities pursuant to compensatory 

benefit plans. 

Plan participants who make use of 

issuer disclosures will also be affected 

by the amendment mandated by the Act. 

To the extent a company issues more 

than $5 million but less than $10 

million in aggregate sales price of 

securities under the rule in a 12-month 

period, the company will not be 

required to deliver the Rule 701(e) 

disclosures to plan participants. 

B. Economic Effects of the Amendment 

The statutory mandate requires the 

Commission to raise the threshold for 

requiring issuers to deliver additional 

disclosure to plan participants in Rule 

701 offerings from $5 million to $10 

million in any consecutive 12-month 

period. This will lower the regulatory 

burden in terms of required disclosures 

and thereby reduce the cost of securities 

offerings in this range pursuant to 

compensatory benefit plans by affected 

non-reporting companies. In addition, if 

the regulatory burden under the 

baseline currently deters some nonreporting companies from using this 

form of compensation arrangement to an 

extent that otherwise would be desired, 

such companies may be able to improve 

the efficiency of their employee 

compensation plans or contracts under 

the amendment and thereby improve 

company performance (e.g., through 

improved incentive provisions). Such 

increases in efficiency may permit these 

companies to deploy resources more 

productively. Further, these efficiency 

gains may be passed through to some 

plan participants through increases in 

the value of securities offered by nonreporting companies as these companies 

are able to avail themselves of the Rule 

701 exemption without having to 

provide the previously required 

disclosure. 

The amendment may reduce the 

amount of information available to plan 

participants, as issuers conducting 

offerings in the $5 million to $10 

million range will not be required to 

provide Rule 701(e) disclosures to 

investors a reasonable period of time 

before the date of sale. Less information 

to plan participants may in turn make 

it harder for them to accurately value 

the offerings, and may partially offset 

the efficiency gains noted above. To the 

extent non-reporting issuers have issued 

securities in reliance on Regulation A 

and made available the information 

required by Rule 701(e) or have issued 

securities in excess of $5 million in 

reliance on Rule 701 in the current 12- 

month period, and, at their option, 

continue to provide the disclosures 

required by Rule 701(e), there may be no 

loss of information to participants.21

We expect the amendment to make 

compliance burdens the same between 

companies seeking to use Rule 701 to 

offer amounts up to $5 million and 

companies seeking to use Rule 701 to 

offer amounts between $5 million and 

$10 million. By doubling the amount of 

securities that can be offered to 

employees without requiring the 

additional disclosure under Rule 701(e) 

from $5 million to $10 million, the 

amendment to Rule 701 may have 

competitive effects for non-reporting 

companies that offer or sell securities as 

compensation. Although the 

Commission does not anticipate that the 

amendment will have substantial 

competitive effects among firms that 

currently rely on Rule 701, the 

amendment may permit some smaller 

companies to compete with larger 

companies to recruit and retain 

employees by increasing the offering 

amount threshold for additional 

disclosure from $5 million to $10 

million. 

Relatedly, companies seeking to offer 

amounts between $5 million and $10 

million will experience a reduction in 

regulatory burden compared to 

companies wishing to offer amounts 

over $10 million. As discussed below in 

Section V.A, for the purposes of the 

Paperwork Reduction Act, the 

Commission estimates that 

approximately 10% of the 16,149 nonreporting companies, or 1,600 issuers, 

provide information under Rule 701, 

and that approximately one-half of those 

issuers (800) will sell securities in 

compensatory benefit plans between $5 

million to $10 million over a 12-month 

period. Using these estimates, we 

further estimate that the amendment 

will reduce the regulatory burden 

associated with Rule 701 by 400 hours 

of company personnel time and 

$480,000 in professional costs per year. 

Finally, to the extent compensatory 

benefit plans are used by non-reporting 

companies to attract and retain persons 

that are in demand internationally, a 

reduction in regulatory burden due to 

the amendment of Rule 701(e) may also 

increase the international 

competiveness of the companies 

affected by the amendment. 

V. Paperwork Reduction Act 

A. Background and Summary 

Certain provisions of Rule 701 that 

will be affected by the amendment 

contain ‘‘collection of information’’ 

requirements within the meaning of the 

Paperwork Reduction Act of 1995 

(‘‘PRA’’).22 The Commission is 

submitting the amendment to the Office 

of Management and Budget (‘‘OMB’’) for 

review in accordance with the PRA.23

The title for the affected collection of 

information is: 

Rule 701 (OMB Control No. 3235– 

0522). 


jstallworth on DSKBBY8HB2PROD with RULES
Federal Register / Vol. 83, No. 142 / Tuesday, July 24, 2018 / Rules and Regulations 34943 

24See Section IV.A, above. While we estimate 

that there are 16,491 non-reporting companies 

conducting exempt offerings of unregistered 

securities under Regulation A, Regulation 

Crowdfunding and Regulation D, some of these 

issuers may currently be too small to offer securities 

in compensatory benefit plans in excess of $5 

million over a 12-month period. For purposes of 

this PRA analysis, we estimate that approximately 

10% of those issuers currently provide information 

under Rule 701. 

25 Issuers are required to provide information that 

is similar to, but not as extensive as, the 

information required by Form 1–SA [17 CFR 

239.90], the semiannual report required to be filed 

with the Commission under Regulation A [17 CFR 

230.251 through 230.263]. We believe, however, 

that many of these issuers already prepare the same 

types of disclosure in their normal course of 

business, such as for using other exemptions, so we 

estimate that the burden is two hours. 

26We recognize that the costs of retaining outside 

professionals may vary depending on the nature of 

the professional services, but for purposes of this 

PRA analysis we estimate that such costs will be an 

average of $400 per hour. This estimate is based on 

consultations with several registrants, law firms and 

other persons who regularly assist registrants in 

preparing and filing periodic reports with the 

Commission. 

Rule 701 provides an exemption from 

registration for offers and sales of 

securities pursuant to certain 

compensatory benefit plans and 

contracts relating to compensation. 

Issuers conducting employee benefit 

plan offerings in excess of $5 million in 

reliance on Rule 701 are required to 

provide plan participants with certain 

disclosures, including financial 

statement disclosures. This disclosure 

constitutes a collection of information. 

An agency may not conduct or sponsor, 

and a person is not required to respond 

to, a collection of information 

requirement unless it displays a 

currently valid OMB control number. 

Compliance with the information 

collection is mandatory. Responses to 

the information collection are not kept 

confidential and there is no mandatory 

retention period for the information 

disclosed. 

We estimate that currently 

approximately 1,600 issuers 24 provide 

information under Rule 701, and that 

the estimated number of burden hours 

per respondent is two.25 Therefore, we 

estimate an aggregate of 3,200 burden 

hours per year. The portion of the 

burden carried by outside professionals 

is reflected as a cost, while the portion 

of the burden carried by the issuer 

internally is reflected in hours. We 

estimate that 25% of the burden per 

response is completed by the issuer 

internally and the other 75% of burden 

per response is attributed to outside 

cost, using $400 as the professional cost 

per burden hour.26 We believe the 

amendment will reduce the current 

burden estimates associated with Rule 

701 for issuers that sell securities in 

compensatory benefit plans in the $5 

million to $10 million range over a 12- 

month period, especially for issuers that 

do not otherwise prepare the same types 

of disclosure in their normal course of 

business. We estimate this will impact 

one-half of the issuers that currently 

provide information under Rule 701, or 

800 issuers. 

We therefore estimate the total annual 

decrease in the paperwork burden for all 

affected companies to comply with the 

collection of information requirements 

of Rule 701, as amended, will be 

approximately 1,600 hours, allocated as 

a decrease of 400 hours (800 issuers × 

0.5 burden hour) of company personnel 

time and a decrease of $480,000 of 

professional costs (800 issuers × 1.5 

hours × $400 per hour). 

TABLE 1—DECREASE IN PAPERWORK BURDEN UNDER THE FINAL AMENDMENT

Estimated 

number of 

affected 

responses 

Decrease in 

burden hours 

per response 

Total decrease 

in burden 

hours 

25% 

Company 

75% 

Professional 

Professional 

costs 

(A) (B) (C) = (A) * (B) (E) = (C) * 

0.25 

(E) = (C) * 

0.75 

(F) = (E) * 

$400 

Rule 701(e) disclosure ............................. 800 2 (1,600) (400) (1,200) ($480,000) 

B. Request for Comment 

We request comments in order to 

evaluate: (1) Whether the collection of 

information is necessary for the proper 

performance of the functions of the 

agency, including whether the 

information would have practical 

utility; (2) the accuracy of our estimate 

of the burden of the collection of 

information; (3) whether there are ways 

to enhance the quality, utility and 

clarity of the information to be 

collected; and (4) whether there are 

ways to minimize the burden of the 

collection of information on those who 

are to respond, including through the 

use of automated collection techniques 

or other forms of information 

technology. 

Any member of the public may direct 

to us any comments concerning the 

accuracy of these burden estimates and 

any suggestions for reducing the 

burdens. Persons who desire to submit 

comments on the collection of 

information requirements should direct 

their comments to the Office of 

Management and Budget, Attention: 

Desk Officer for the Securities and 

Exchange Commission, Office of 

Information and Regulatory Affairs, 

Washington, DC 20503, and send a copy 

of the comments to Brent J. Fields, 

Secretary, Securities and Exchange 

Commission, 100 F Street NE, 

Washington, DC 20549–1090, with 

reference to File No. S7–17–18. 

Requests for materials submitted to the 

OMB by us with regard to these 

collections of information should be in 

writing, refer to File No. S7–17–18 and 

be submitted to the Securities and 

Exchange Commission, Office of FOIA 

Services, 100 F Street NE, Washington, 

DC 20549–0213. Interested persons are 

encouraged to send comments to the 

OMB by August 23, 2018. 

VI. Statutory Authority 

The amendment contained in this 

release is adopted under the authority 

set forth in sections 3(b), 19(a), and 28 

of the Securities Act and section 507 of 

the Economic Growth, Regulatory 

Relief, and Consumer Protection Act. 

List of Subjects in 17 CFR Part 230 

Reporting and recordkeeping 

requirements, Securities. 

Text of Amendment 

For the reasons set out in the 

preamble, title 17 chapter II of the Code 

of Federal Regulations is amended as 

follows: 

PART 230—GENERAL RULES AND 

REGULATIONS, SECURITIES ACT OF 

1933 

■ 1. The authority citation for part 230 

continues to read in part as follows: 


jstallworth on DSKBBY8HB2PROD with RULES
34944 Federal Register / Vol. 83, No. 142 / Tuesday, July 24, 2018 / Rules and Regulations 

Authority: 15 U.S.C. 77b, 77b note, 77c, 

77d, 77f, 77g, 77h, 77j, 77r, 77s, 77z–3, 77sss, 

78c, 78d, 78j, 78l, 78m, 78n, 78o, 78o–7 note, 

78t, 78w, 78ll(d), 78mm, 80a–8, 80a–24, 80a– 

28, 80a–29, 80a–30, and 80a–37, and Pub. L. 

112–106, sec. 201(a), sec. 401, 126 Stat. 313 

(2012), and Pub. L. 115–174, sec. 507, 132 

Stat. 1296 (2018), unless otherwise noted. 

* * * * * 

■ 2. Section 230.701 is amended by 

revising the introductory text of 

paragraph (e) to read as follows: 

§ 230.701 Exemption for offers and sales 

of securities pursuant to certain 

compensatory benefit plans and contracts 

relating to compensation. 

* * * * * 

(e) Disclosure that must be provided. 

The issuer must deliver to investors a 

copy of the compensatory benefit plan 

or the contract, as applicable. In 

addition, if the aggregate sales price or 

amount of securities sold during any 

consecutive 12-month period exceeds 

$10 million, the issuer must deliver the 

following disclosure to investors a 

reasonable period of time before the 

date of sale: 

* * * * * 

By the Commission. 

Dated: July 18, 2018. 

Brent J. Fields, 

Secretary. 

[FR Doc. 2018–15730 Filed 7–23–18; 8:45 am] 

BILLING CODE 8011–01–P 

DEPARTMENT OF HOMELAND 

SECURITY 

Coast Guard 

33 CFR Part 165 

[Docket Number USCG–2018–0698] 

RIN 1625–AA08 

Safety Zones; Pipeline Construction, 

Tennessee River Miles 465 to 466, 

Chattanooga, TN 

AGENCY: Coast Guard, DHS. 

ACTION: Temporary final rule. 

SUMMARY: The Coast Guard is 

establishing a temporary safety zone for 

all navigable waters of the Tennessee 

River from mile marker 465 to mile 

marker 466. This safety zone is 

necessary to protect persons, property, 

and the marine environment from 

potential hazards associated with the 

construction of an underground 

pipeline. Entry of vessels or persons 

into this zone is prohibited unless 

authorized by the Captain of the Port 

Sector Ohio Valley or a designated 

representative. 

DATES: This rule is effective from 7:30 

a.m. on July 24, 2018, through 7 p.m. on 

August 24, 2018. This rule will be 

enforced from 7:30 a.m. through 7 p.m. 

each day during the effective period, 

excluding Saturdays and Sundays. 

ADDRESSES: To view documents 

mentioned in this preamble as being 

available in the docket, go to http://

www.regulations.gov, type USCG–2018– 

0698 in the ‘‘SEARCH’’ box and click 

‘‘SEARCH.’’ Click on Open Docket 

Folder on the line associated with this 

rule. 

FOR FURTHER INFORMATION CONTACT: If 

you have questions on this rule, call or 

email Petty Officer Nicholas Jones, 

Marine Safety Detachment Nashville, 

U.S. Coast Guard; telephone 615–736– 

5421, email MSDNashville@uscg.mil. 

SUPPLEMENTARY INFORMATION: 

I. Table of Abbreviations 

CFR Code of Federal Regulations 

COTP Captain of the Port Sector Ohio 

Valley 

DHS Department of Homeland Security 

FR Federal Register 

NPRM Notice of proposed rulemaking 

§ Section 

U.S.C. United States Code 

II. Background Information and 

Regulatory History 

On July 10, 2018, Reynolds 

Construction, L.L.C notified Marine 

Safety Detachment Nashville that their 

underwater pipeline construction 

operations at mile marker 465.2 of the 

Tennessee River would be ready to 

commence on July 24, 2018. Reynolds 

Construction estimates that the work 

will take 20 days, excluding weekends 

and holidays, and will conclude no later 

than August 24, 2018. 

The Coast Guard is issuing this 

temporary rule without prior notice and 

opportunity to comment pursuant to 

authority under section 4(a) of the 

Administrative Procedure Act (5 U.S.C. 

553(b)). This provision authorizes an 

agency to issue a rule without prior 

notice and opportunity to comment 

when the agency for good cause finds 

that those procedures are 

‘‘impracticable, unnecessary, or contrary 

to the public interest.’’ Under 5 U.S.C. 

553(b)(3)(B), the Coast Guard finds that 

good cause exists for not publishing a 

notice of proposed rulemaking (NPRM) 

with respect to this rule because it is 

impracticable. We must establish this 

safety zone by July 24, 2018, and lack 

sufficient time to provide a reasonable 

comment period and then consider 

those comments before issuing the rule. 

Under 5 U.S.C. 553(d)(3), the Coast 

Guard finds that good cause exists for 

making it effective less than 30 days 

after publication in the Federal 

Register. Delaying the effective date of 

this rule would be contrary to public 

interest because immediate action is 

needed to respond to potential safety 

hazards associated with the underwater 

pipeline construction. 

III. Legal Authority and Need for Rule 

The Coast Guard is issuing this rule 

under authority in 33 U.S.C. 1231. The 

Captain of the Port Sector Ohio Valley 

(COTP) has determined that potential 

hazards associated with the underwater 

blasting and pipeline construction will 

be a safety concern for anyone on a onemile stretch of the Tennessee River. 

This rule is necessary to protect 

persons, vessels, and the marine 

environment during the construction 

operations. 

IV. Discussion of the Rule 

This rule establishes a temporary 

safety zone from 7:30 a.m. on July 24, 

2018 through 7 p.m. on August 24, 2018 

from mile marker 465 to mile marker 

466 on the Tennessee River in 

Chattanooga, TN. The safety zone will 

be enforced from 7:30 a.m. through 7 

p.m. each day, excluding Saturdays and 

Sundays. A safety vessel will coordinate 

all vessel traffic during the enforcement 

periods. The COTP may terminate 

enforcement of this rule if the work is 

finished earlier. The duration of the 

safety zone is intended to protect 

persons, vessels, and the marine 

environment during the construction 

operations. 

No vessel or person is permitted to 

enter the safety zone without obtaining 

permission from the COTP or a 

designated representative. A designated 

representative is a commissioned, 

warrant, or petty officer of the U.S. 

Coast Guard assigned to units under the 

operational control of Sector Ohio 

Valley, U.S. Coast Guard. They may be 

contacted on VHF Channel 13 or 16, or 

at 1–800–253–7465. All persons and 

vessels permitted to enter this safety 

zone must transit at their slowest safe 

speed and comply with all directions 

issued by the COTP or the designated 

representative. The COTP or a 

designated representative will inform 

the public of the enforcement times and 

dates for this safety zone through 

Broadcast Notices to Mariners (BNMs), 

Local Notices to Mariners (LNMs), and/ 

or Marine Safety Information Bulletins 

(MSIBs), as appropriate. 

V. Regulatory Analyses 

We developed this rule after 

considering numerous statutes and 

Executive orders related to rulemaking. 

Below we summarize our analyses 


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