Governance & Compliance Insider

Impact of “Test-the-Waters” Reform Debated

As we previously noted, in February, the SEC proposed expanding its “test-the-waters” accommodation from emerging growth companies (EGCs) only to all issuers via a new Rule 163B and related amendments. This accommodation would enable all issuers to engage in “test-the-waters” communications with certain institutional investors regarding a contemplated registered securities offering prior to, or following the filing of a registration statement related to such offering....

SEC Proposes to Revise the Accelerated and Large Accelerated Filer Definitions

The SEC proposed amendments that would revise the definitions of “accelerated filer” and “large accelerated filer.” These proposed revisions follow amendments adopted by the SEC on June 28, 2018, that expanded the smaller reporting company (SRC) definition and so brought some issuers under both the definitions of an accelerated filer and an SRC. As a result of last year’s amendments, some SRCs must have an...

What the LIBOR Phase-out Means for Debt Capital Market Participants

The London Interbank Overnight Rate (“LIBOR”) is an interest rate calculation that is used globally for purposes of debt capital market transactions including bond issuances, loans, and derivatives. In particular, LIBOR underpins many Floating Rate Notes (“FRNs”), which use the rate as a reference for purposes of calculating coupon. The intention is that LIBOR reflects the overall health of the financial system, which in turn...

Recent Dorsey eUpdate: New Streamlined Procedure for Extension of Confidential Treatment

Public companies that have previously obtained a confidential treatment order from the Staff of the Securities and Exchange Commission for a material contract filed as an exhibit under the periodic reporting requirements of the Securities Exchange Act of 1934 must continue to file extension applications if they want to protect the confidential information from public release pursuant to a Freedom of Information Act request after...

Recent Dorsey eUpdate: Summary of SEC’s FAST Act Amendments and Additional Guidance on Confidential Treatment Requests

The SEC recently finalized amendments to its regulations to modernize and simplify disclosure requirements for public companies, investment advisors and investment companies, consistent with the Commission’s mandate under the Fixing America’s Surface Transportation (FAST) Act. The SEC subsequently released an additional announcement on the amendments to the confidential treatment request requirements. More information on the amendments relevant to public companies, including markups of the Form...

SEC Proposes to Expand “Test-the-Waters” Modernization Reform to All Issuers

The SEC proposed a new rule and related amendments that would expand the “test-the-waters” accommodation—currently available to emerging growth companies—to all issuers, including investment company issuers. Proposed Securities Act Rule 163B, if adopted, would significantly enhance an issuer’s ability to cost-effectively assess the demand for and valuation of its securities, and also provide insights into the structural components for the offering that are important to investors....

Upcoming Webinar on the SEC’s New Mining Disclosure Rules – 2/26

You are invited to join us on February 26, 2019, at 11 am PT/2 pm ET, for a webinar discussing the SEC’s new mining disclosure rules. On October 31, 2018, the SEC adopted final rules effecting a complete overhaul of the technical disclosure requirements applicable to companies engaged in material mining operations, including royalties. Upon effectiveness in 2021, the new rules will replace the SEC’s...

Johnson & Johnson May Exclude Shareholder Proposal for Binding Arbitration on Securities Claims

On February 11, 2019, the Staff of the Division of Corporation Finance granted no-action relief permitting Johnson & Johnson to omit a shareholder proposal from its proxy statement.  The shareholder proposal requested mandatory arbitration of shareholder claims arising under the federal securities laws. The Staff relied on Rule 14a-8(i)(2), which permits exclusion of a proposal that, if implemented, would cause the company to violate any...

When It Comes to Self-Identified Diversity: Trust But Verify

On February 6, 2019, the SEC’s Division of Corporation Finance released Compliance and Disclosure Interpretations (identical Questions 116.11 and 133.13) advising companies on how they should disclose directors’ self-identified specific diversity characteristics (such as race, gender, ethnicity, religion, nationality, disability, sexual orientation or cultural background) in proxy statements. In brief, Corp Fin would expect the company’s discussion of directors’ experience, qualifications, attributes or skills pursuant...