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
1934 Act Filings
Charges Against Nikola Founder Provide Reminder to Use Caution in All Public Statements and Offer Governance Lessons
On July 29, 2021, both the SEC and the U.S. Attorney for the Southern District of New York announced charges against Trevor Milton, the founder, former CEO and former executive chairman of Nikola Corporation, a company engaged in the development of electric trucks. The complaint and indictment allege a series…
SEC Focus on SPACs
Special purpose acquisition companies (SPACs) have become an important investment vehicle and source of M&A activity. SPAC transactions include aspects of both initial public offerings and business combinations.
In 2020, we’ve seen a surge in new SPAC IPOs (particularly as a percentage of overall IPOs), the amount of capital raised…
SEC Proposes Changes to Equity Compensation Rules for Public and Private Companies
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…
Nasdaq Extends Date for Compliance With Price-Related Listing Requirements
In response to the effect of the COVID-19 crisis on the public equity markets, Nasdaq is extending the time it will give a listed company to regain compliance with Nasdaq’s listing standards if its closing bid price falls below $1.00 for 30 consecutive trading days. The rule change allows for…
ISS and Glass Lewis Announce Flexibility In Corporate Governance Policies During COVID-19 Crisis
ISS and Glass Lewis have issued guidance on their corporate governance voting policies that adds flexibility to reflect the realities of the impact of the COVID-19 crisis and the challenges in responding to it. Public companies will want to consider this guidance since many institutional investors are influenced in their…
SEC Supplements Guidance for Conducting Shareholder Meetings
On April 7, 2020, the SEC modified its March 13th guidance described here, addressing the effect of the coronavirus (COVID-19) on annual shareholder meetings.
The modified guidance notes that issuers encountering delays in printing and mailing a full set of their physical proxy materials may choose to furnish their…
NYSE Gives Temporary Relief to Listed Companies for Private Placements with Insiders
In times of economic distress, insiders can sometimes be the only source of capital for a company with urgent liquidity needs. Applying lessons learned in the 2008-2009 financial crisis to the current COVID-19 market disruptions, the NYSE temporarily relaxed its shareholder approval rules on April 6, 2020, effective immediately and…
SEC Issues Guidance on Deadline for Part III Information Omitted From Form 10-K
The SEC issued new guidance yesterday supplementing its previously-announced COVID-19 order that gives relief from Exchange Act filing deadlines (see our blog post about the COVID-19 order here). The guidance details how the order applies to companies that omitted from their annual report on Form 10-K the information required…
Federal Reserve Will Become a Direct Lender to Corporations and an Investor in Corporate Bond Markets
As part of its response to the COVID-19 crisis, on March 23, 2020, the Board of Governors of the Federal Reserve System announced a number of new programs designed to limit credit market disruption. Two of these new programs put the Federal Reserve in an unprecedented role as a direct…