The Delaware General Corporation Law (§ 102(b)(7)) has been amended, effective August 1, 2022, to permit exculpation of corporate officers, but in a more limited way than the exculpation of directors that has long been permitted. Unlike directors, officers may be exculpated by a provision in the certificate of incorporation
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Integration of Private and Public Offerings 2022
By Stanley Keller on
Posted in Uncategorized
This outline reviews the SEC’s interpretations that relate to the integration of private and public offerings and the challenges they present for the capital formation process. The outline also describes current policies of the SEC staff that affect so-called “PIPE” offerings and “private equity lines.” It has been updated to…
SEC Proposes Climate-Related Disclosure Requirements
By Rob Evans on
Posted in Uncategorized
Earlier this week, the SEC announced proposed rules (Release No. 33-11042) for new, climate-related disclosures. The proposals dramatically expand the requirements of the SEC’s 2010 guidance on climate-related disclosures. While most large companies have been providing some climate-related information as part of ESG reporting in CSR or Sustainability…
SEC Proposes Tighter Cybersecurity Disclosure Requirements
By Rob Evans on
The SEC has proposed rules (Release No. 33-11038) that would require new cybersecurity disclosures. If adopted the rules would codify and build upon the Commission guidance on cybersecurity risks and incidents.
The proposed amendments include:
- Form 8-K filing regarding material cybersecurity incidents within 4 business days
- Forms 10-K
…
SEC Proposes to Shorten Schedule 13D/G Filing Deadlines and Count Equity Derivatives
By Rob Evans on
Posted in Uncategorized
Last week, the SEC proposed new rules that would shorten the time periods for filing a Schedule 13D or 13G after acquisition of beneficial ownership of 5% or more of the voting stock of a public company from 10 days to 5 days. Other deadlines in the rules would be…
Delaware Court Addresses De-SPAC Merger Claims
By Stanley Keller on
In an important decision, the Delaware Court of Chancery, in In re Multiplan Corp. Stockholders Litigation, 2022 WL 24060 (Del. Ch. Jan. 3, 2022), in denying the defendants’ motion to dismiss, addressed claims against the sponsor and other insiders of a special purpose acquisition company or “SPAC” for…
Delaware Court Provides Guidance on Director Liability for Distributions
By Rob Evans on
Companies often make distributions to their stockholders as dividends and stock buybacks. For private equity-backed companies, it is not unusual to see leveraged recaps in which the company borrows money and makes distributions to the private equity investors. These distributions raise the question for boards of directors of whether the…
Delaware Clarifies That Statutory Appraisal Rights Can Be Waived
By Stanley Keller on
Posted in Corporate Governance, Uncategorized
Controlling stockholders sometimes seek to limit the ability of new investors in their company to interfere with future exit transactions. They may do this by requiring the new investors to agree to vote in favor of a transaction proposed by the controlling stockholder (a “drag-along agreement”) or to expressly waive…
Delaware Clarifies Its Rules Governing Stockholder Derivative Actions
By Stanley Keller on
Derivative actions play an important role in policing corporate insider conduct and compliance by directors and controlling stockholders with their fiduciary duties. A derivative action enables a stockholder, upon satisfaction of applicable requirements, to bring litigation on behalf of the corporation challenging, for example, conflict of interest transactions, the adequacy…
Locke Lord QuickStudy: SEC Signals Heightened ESG Focus
By Gerald Pels on
On September 22, 2021, the SEC released its Sample Letter to Companies Regarding Climate Change Disclosure (“Letter”). The Letter is not only important for what it will seek, but for what it portends. The Letter invokes the 2010 Climate Change Guidance[1] (“Guidance”) which provided an overview of potential disclosure…