On August 6, 2021, the U.S. Securities and Exchange Commission approved Nasdaq’s proposed rule regarding diversity of boards of directors.[1] The approved rule requires that most companies listed on Nasdaq (i) “[p]ublicly disclose board-level diversity statistics using a standardized template,” and (ii) “[h]ave or explain why they do not
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SEC Reminds Companies That Earnings Management Can Have MD&A Consequences
By Stanley Keller on
Posted in Uncategorized
In a settled enforcement action against Under Armour Inc. announced on May 3, 2021 the SEC reminded companies that managing earnings, even if accounted for correctly, can have MD&A implications triggering disclosure obligations. According to the SEC order, Under Armour, in order to meet analyst projections and sustain its 20%…
SEC Provides Reminder that Form 12b-25 is a Disclosure Document
By Stanley Keller on
The SEC’s Division of Enforcement announced on April 29, 2021 settled enforcement actions against eight companies for failure to adequately disclose the reasons for their inability to timely file their Form 10-Ks or Form 10-Qs when filing a Form 12b-25 (commonly known as “Form NT”) to extend the time to…
Locke Lord QuickStudy: Delaware Court of Chancery Reminds That Rights Plans Have Limits
By Stanley Keller on
Posted in Corporate Governance, Uncategorized
The Delaware Court of Chancery, in The Williams Companies Stockholder Litigation, 2021 WL 754593 (Del. Ch. Feb. 26, 2021), struck down a shareholder rights plan (commonly known as a “poison pill”) adopted by The Williams Companies, Inc. at the outset of the pandemic that depressed the energy industry in…
Delaware Decision Has Lessons for Lenders and Others
By Stanley Keller on
On December 8, 2020, the Delaware Court of Chancery in Stream TV Networks, Inc. v. SeeCubic, Inc.[1] upheld a unique structure established by secured lenders to protect their interests and in doing so the Court addressed a number of corporate law issues.
Stream TV Networks, Inc. (“Stream“) was a…
SEC Revision of MD&A – Focus on Future Uncertainties Disclosure
By Stanley Keller on
The Securities and Exchange Commission has continued its effort to update and streamline the disclosure requirements for filings with the SEC. In November, the SEC adopted amendments to the rules for Management’s Discussion and Analysis and related financial disclosures. [1] MD&A, because of its principles-based nature, is among the most…
SEC Proposes Changes to Equity Compensation Rules for Public and Private Companies
By Stanley Keller on
The Securities and Exchange Commission, on November 24, 2020, proposed changes to the rules and forms that are used for compensatory securities offerings by both private and public companies. If adopted, the changes should give added flexibility to companies using equity as part of their compensation programs for employees, directors…
SEC Adopts Significant Changes in Regulation of Exempt Offerings (UPDATED)
By Stanley Keller on
The Securities and Exchange Commission on November 2, 2020, by a 3 to 2 vote, adopted significant changes to the rules governing capital raising through private offerings and other offerings exempt from registration under the Securities Act of 1933. The adopting release (available here) indicates that these changes are…
SEC Updates Accredited Investor Definition; Makes Related Changes to Qualified Institutional Buyer Definition
By Stanley Keller on
The Securities and Exchange Commission on August 26, 2020 adopted changes to the definition of accredited investor intended to modernize the exempt offering process. It also made related changes to the definition of qualified institutional buyer. This was one of two actions taken by the SEC on that date; see…
SEC Adopts Rules for Proxy Voting Advisory Firms, Issues Supplemental Guidance for Investment Advisors
Posted in Uncategorized
On July 22, 2020, the SEC adopted final rules on the application of its proxy solicitation rules to proxy voting advisors. (See our November 2019 blog post on the proposed rules here.) Among other things, the new rules will, for practical purposes, require these proxy advisory firms – most…