On Sept. 26, 2018, the SEC approved a proposal previously filed in January by The Nasdaq Stock Market LLC to amend Nasdaq Listing Rule 5635(d), the shareholder approval rules applicable to discounted private placements. Under the previous version of Nasdaq Listing Rule 5635(d), Nasdaq-listed companies were generally required to obtain shareholder approval prior to the issuance of securities in a nonpublic offering if (1) the number of shares of common stock issued or potentially issuable (including on conversion or exercise of warrants or convertible securities) was equal to 20 percent or more of the common stock outstanding or the voting power prior to the issuance, and (2) the issuance price was less than the greater of the book or market value of the common stock.
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