Broader Availability of Termination Fees and Rights of First Refusal -

Elimination of Filing for Certain ETFs:

In May 2014, the SEC approved FINRA’s proposed amendments to Rule 5110, commonly called the Corporate Financing Rule. The Corporate Financing Rule addresses commercial fairness in underwriting and other arrangements for the distribution of securities. Rule 5110 provides for review by FINRA of underwriting or other arrangements in connection with most public offerings in order to enable FINRA to assess the fairness and reasonableness of proposed underwriting compensation and arrangements. In addition, the underwriters of an offering must comply with a variety of substantive provisions in Rule 5110, even if the offering is exempt from filing.

Among other changes, the amendments expand an investment bank’s ability to include termination fees and rights of first refusal in engagement letters, and eliminate the requirement to file offerings of certain additional types of ETFs.