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Advisory Contracts

Morrison & Foerster LLP

Investment Adviser Compliance Index - 2019

The Investment Advisers Act of 1940 (the “Advisers Act”) is the shortest of the federal securities laws enacted after the Great Depression, and the SEC has adopted relatively few regulations under the Advisers Act. As any...more

Dorsey & Whitney LLP

OCIE Risk Alert Highlights the Most Frequent Adviser Fees and Expenses Deficiencies

Dorsey & Whitney LLP on

On April 12, 2018, the SEC’s Office of Compliance Inspections and Examinations (“OCIE”) released a Risk Alert identifying the most frequently cited compliance deficiencies relating to fees and expenses charged by SEC...more

Skadden, Arps, Slate, Meagher & Flom LLP

What Can Mutual Fund Boards and Advisers Learn From the AXA Trial Ruling?

In the first trial of a recent wave of cases under Section 36(b) of the Investment Company Act, Judge Peter G. Sheridan of the U.S. District Court for the District of New Jersey ruled in favor of the defendant-adviser,...more

Neal, Gerber & Eisenberg LLP

SEC Increases Performance Fee Net Worth Threshold for Qualified Clients

Effective August 15, 2016, the net worth threshold for qualified clients under Rule 205-3 is increased from $2 million to $2.1 million. If you have advisory agreements or subscription agreements that require a client or...more

Bennett Jones LLP

Tax Court Allows Deduction for Advisory Fees in M&A Transaction

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The Tax Court of Canada has recognized in a recent case that “oversight expenses” – notably investment banking and other professional advisory fees for services rendered to boards of directors in their discharge of oversight...more

Winstead PC

Recent Amendment of SEC’S “Qualified Client” Definition

Winstead PC on

The SEC recently adopted an amendment increasing the net worth threshold set forth in the definition of "qualified client" under the Advisers Act. For an investment adviser that is registered with the SEC, or one that is...more

Foley Hoag LLP

SEC Increases Performance Fee Thresholds

Foley Hoag LLP on

As noted in a previous alert, the Securities and Exchange Commission has now issued an Order, effective as of August 15, 2016 (the "Effective Date"), which amends SEC Rule 205-3 (the “Performance Fee Rule”) under the...more

BCLP

SEC to Adjust Net Worth Threshold for Qualified Clients

BCLP on

On June 14, 2016, the U.S. Securities and Exchange Commission (“SEC”) issued an order increasing the net worth threshold for “qualified clients” under the Investment Advisers Act of 1940 (“Advisers Act”). This change, made...more

Proskauer Rose LLP

SEC Adopts Higher Net Worth Threshold for Qualified Clients under the Advisers Act

Proskauer Rose LLP on

In an order dated June 14, 2016, the Securities and Exchange Commission (SEC) adopted its prior proposal to increase the net worth threshold for "qualified clients" under Rule 205-3 of the Investment Advisers Act of 1940 (the...more

Orrick - Finance 20/20

SEC Issues Order Increasing the Net Worth Test Under Rule 205-3 Under the Investment Advisers Act of 1940 to $2.1 Million

Orrick - Finance 20/20 on

Section 205(a)(1) of the Investment Advisers Act of 1940 (the “Advisers Act”) generally prohibits an investment adviser from entering into, extending, renewing, or performing any investment advisory contract that provides for...more

Dorsey & Whitney LLP

SEC Raises Qualified Client Threshold for Investment Adviser Performance Fees

Dorsey & Whitney LLP on

Effective as of August 15, 2016, the dollar amount of the “qualified client” net worth test will increase from $2,000,000 to $2,100,000. On June 14, 2016, the SEC issued an Order Approving Adjustment for Inflation of the...more

Proskauer - The Capital Commitment

SEC Proposes Higher Net Worth Threshold for Qualified Clients under the Advisers Act

On Wednesday, May 18, 2016, the U.S. Securities and Exchange Commission (SEC) proposed to increase the net worth threshold for qualified clients from $2 million to $2.1 million. This proposed adjustment is being made...more

Foley & Lardner LLP

A Compilation of Non-Enforcement Actions

Foley & Lardner LLP on

Be Careful to Adhere to Best Practices When Approving Advisory Agreements - The Securities and Exchange Commission instituted and settled an administrative proceeding against an investment adviser, its principal, and...more

Goodwin

Second Circuit Rules for Mutual Fund Trustees in Suit Alleging Breach of Fiduciary Duty in Approving Successor Advisory Contracts...

Goodwin on

The U.S. Court of Appeals for the Second Circuit affirmed the dismissal on a motion for summary judgment of a derivative suit against the independent trustees of a mutual fund group in which the plaintiff shareholder alleged...more

Morrison & Foerster LLP

How Directors Can Handle Adviser’s Exit From Fund Biz

An investment adviser’s decision to exit the fund business can present multiple challenges for the fund board. These challenges can be particularly difficult when the interests of the adviser and those of the fund and its...more

Morgan Lewis

SEC Settles Suit for Misleading Advisory Contract Approval Disclosure

Morgan Lewis on

Settlement with mutual fund directors and service providers serves as a reminder of responsibilities for disclosures relating to the approval of investment advisory contracts and provides insight into SEC enforcement...more

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