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
Shareholder Proposals
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…
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…
SEC Proposes to Broaden and Update Accredited Investor Definition
On December 18, 2019, the Securities and Exchange Commission, on a 3 to 2 vote, proposed amendments to the definition of “accredited investor” in order to update that definition and expand the investors that would qualify as accredited investors able to participate in private offerings.[1] The definition of “accredited…
Delaware Decision Reminds Directors to Oversee Public Disclosures
Delaware law usually protects directors in making good faith business decisions. However, sometimes the failure of directors to oversee a company’s compliance with legal requirements will be so troublesome that this is not the case – providing the basis for a “Caremark claim.” In a recent decision, the Delaware Court…
Nasdaq Permits Direct Listings
On February 15, 2019, Nasdaq filed an immediately effective rule proposal to permit “direct listings” without an IPO and, in doing so, joins the NYSE, whose proposal to permit direct listings was approved by the SEC in February 2018. For a private company that does not need to raise capital…