Newly Adopted SEC Rules Implement FAST Act Mandate and Simplify Disclosure
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SEC Provides Additional Guidance on Excluding Shareholder Proposals
On October 23, 2018, the SEC Division of Corporation Finance issued Staff Legal Bulletin No. 14J (“SLB 14J”), which reiterated and expounded upon prior guidance regarding when companies may exclude shareholder proposals under the economic relevance exception of Rule 14a-8(i)(5), and the ordinary business exception of Rule 14a-8(i)(7).…
SCOTUS Tax Ruling and New Tariffs Could Affect Retail M&A Activity
A recent Supreme Court ruling regarding sales taxes and new tariffs on Chinese imports instituted by the Trump administration will impact many retailers, which could in turn have an effect on M&A activity in the retail industry.…
2018 Proxy Season Update
As the 2018 proxy season is winding down, some trends have begun to emerge regarding CEO pay ratio disclosure, shareholder proposals and virtual shareholder meetings.…
ICO Update
2018 continues to be a busy year for initial coin offerings, notwithstanding recent announcements from capital markets regulators in the US. In this alert, we chronicled developments at the Securities and Exchange Commission, Commodity Futures Trading Commission, state securities regulators and others. And here we discussed recent SEC guidance on trading platforms for crypto assets. Although the rules seem to be multiplying exponentially, it is still possible to structure and complete an ICO that…
SEC Staff Permits Exclusion of Shareholder Proposal Under Economic Relevance Exception
At the end of February, the SEC staff issued a No-Action Letter to Dunkin’ Brands Group, Inc., permitting the company to exclude a shareholder proposal under Rule 14a-8(i)(5), often referred to as the economic relevance exception. This is the first no-action relief granted under the rule since the SEC issued Staff Legal Bulletin No. 14I (“SLB 14I”) on November 1, 2017, and it could have implications for other retailers seeking to exclude shareholder proposals under…
Securities Regulators Expand Oversight of ICO Market and Digital Currency
The Initial Coin Offering (“ICO”) market exploded in 2017 with almost $4 billion of investments. Securities regulators in the United States have responded first with a series of public warnings and, more recently, by bringing enforcement actions against promoters of ICOs and other digital currency investments. We survey some of the recent regulatory developments in this rapidly evolving field.…
Company Ends Initial Coin Offering after SEC Finds Securities Violations
On December 11, 2017, the SEC issued a cease-and-desist order against Munchee Inc. after finding that the company’s initial coin offering (“ICO”) constituted unregistered offers and sales of securities. Munchee sought to raise $15 million for its blockchain-based food review and social platform by selling digital tokens to users that could be used to buy and sell goods and services through an iPhone app. Munchee and others promoting the ICO told investors that the tokens…
New York City Comptroller Launches Boardroom Accountability Project 2.0
On September 8, 2017, New York City Comptroller Scott Stringer and the New York City Pension Funds announced the second phase of their Boardroom Accountability Project, which will focus on board diversity and composition. Stringer sent a letter to the nominating and governance committee chairs of 151 portfolio companies held by the New York City Pension Funds, requesting board engagement regarding the director refreshment process and disclosure of a director qualification matrix that identifies directors’…
Shareholders Show Strong Preference for Annual Say on Pay Votes
When say-on-pay (i.e., shareholders with the right to vote on the remuneration of executives) was introduced under the Dodd-Frank Wall Street Reform and Consumer Protection Act, there was a requirement that companies conduct say-on-pay frequency votes every six years for shareholders to decide whether say-on-pay votes should be held every one, two or three years. Companies first held say-on-pay frequency votes in 2011, so for many companies the 2017 proxy season is the first time…