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Buyer Potentially Liable for Earnout Even Though it had Right to Operate Target in its Discretion

In Shareholder Representative Services LLC v Albertsons Companies, Inc., the aggrieved former shareholders of DineInFresh, Inc., d/b/a Plated, sought recovery of earnout consideration from Plated’s acquirer, Defendant,...more

Pre-Closing Dividend Did Not Violate Appraisal Rights Statute

In Re GGP, Inc. Stockholder Litigation arose out of a case where Brookfield Property Partners, L.P. and its affiliates acquired GGP.  The merger agreement provided upon approval of a majority of the GGP stock unaffiliated...more

Chancery Permits Reverse Veil Piercing

Manichaean Capital, LLC et al v. Exela Technologies, Inc., et al begins with the Delaware Court of Chancery recounting the results of an appraisal action with respect to the acquisition of SourceHOV Holdings, Inc. The former...more

PCAOB Proposes Rule to Create Framework for HFCAA Determinations

The Public Company Accounting Oversight Board has proposed a new rule provide a framework for its determinations under the Holding Foreign Companies Accountable Act, or the HFCAA....more

Votes Compelled by Stockholders Agreement Do Not Count Towards Corwin Cleansing

In connection with an M&A transaction, in In Re Pattern Energy Group Inc. Stockholders Litigation the Delaware Court of Chancery determined that that the plaintiff had stated a claim against the director defendants for breach...more

Delegating Preparation of Proxy Statement to Management was an Unexculpated Act of Bad Faith

In Re Pattern Energy Group Inc. Stockholders Litigation involved an M&A transaction where the sales process of Pattern Energy Group Inc. was run by an undisputedly disinterested and independent special committee that...more

SEC Charges Eight Companies for Failure to Disclose Complete Information on Form NT

The Securities and Exchange Commission charged eight companies for failing to disclose in SEC Form 12b-25 filings, commonly known as Form NT, that their request for seeking a delayed quarterly or annual reporting filing was...more

House Passes Legislation Addressing 10b5-1 Plans

The House of Representatives has passed the “The Promoting Transparent Standards for Corporate Insiders Act” (H.R. 1528) by a vote of 355-69.  The bill directs the Securities and Exchange Commission to study and report on...more

SEC Risk Alert Notes Deficiencies in ESG Investing Processes

The SEC Division of Examinations has issued a Risk Alert to highlight observations from recent exams of investment advisers, registered investment companies, and private funds offering ESG products and services....more

Corp Fin Director Questions Application of PSLRA to De-SPAC Transactions

John Coates, Acting Director, Division of Corporation Finance, issued a statement questioning the application of the safe harbor for forward looking information in the Private Securities Litigation Reform Act (PSLRA) to a...more

FINCEN Takes Steps Toward Preparing Regulations for Beneficial Ownership Reporting Under the Corporate Transparency Act

FINCEN has issued an Advance Notice of Proposed Rulemaking, or ANPRM to solicit public comment on a wide range of questions related to the implementation of the beneficial ownership information reporting provisions of the...more

PCAOB Releases 2021 Audit Committee Resource

The PCAOB has released a publication captioned “Audit Committee Resource: 2021 Inspections Outlook.”  The purpose of the three-page publication is to assist audit committees in engaging in informed dialogue with their...more

NYSE Completes Amendments to Shareholder Approval and Related Party Requirements

The NYSE has amended the Listed Company Manual regarding shareholder approval requirements for the issuance of securities and certain related party matters. The SEC approved the amendments on an accelerated basis....more

SEC Warns SPAC Targets the Road May be Difficult

The SEC issued two pieces of guidance on special purpose acquisition companies, or SPACs.  One piece, styled as a statement by Paul Munter, Acting Chief Accountant, speaks to financial reporting and auditing considerations of...more

Court Finds Buyer is not Required to Return Cash in Purported “Cash Free, Debt Free” Deal

Deluxe Entertainment Services Inc. v. DLX Acquisition Corporation involved a stock purchase agreement where Plaintiff Deluxe Entertainment sold all of its stock (the “Transaction”) in its wholly owned subsidiary, Deluxe Media...more

Resolution Introduced to Invalidate Revisions to Shareholder Proposal Rules

In September 2020 the SEC adopted final rules altering the shareholder proposal framework for the first time in 20 years. Following another split-vote of the Commissioners, the SEC approved modifications to the current...more

SEC Adopts Interim Amendments for the Holding Foreign Companies Accountable Act

The SEC has adopted interim final amendments to Form 10-K, Form 20-F, Form 40-F, and Form N-CSR to implement the disclosure and submission requirements of the Holding Foreign Companies Accountable Act, or the HFCA Act....more

Delaware to Consider Public Policy of Assisting Shell Company Mergers

In re Forum Mobile, Inc. considers petitioner Synergy Management Group LLC’s request for the appointment of its President to be custodian of Forum Mobile, Inc. under Section 226(a)(3) of the Delaware General Corporation Law,...more

SEC Brings Charges for Failure to Disclose Perks

The Securities and Exchange Commission announced settled charges against an Oklahoma-based gas exploration and production company, Gulfport Energy Corporation, and its former CEO, Michael G. Moore, for failing to properly...more

SEC Announces Enforcement Task Force Focused on Climate and ESG Issues

The Securities and Exchange Commission announced the creation of a Climate and ESG Task Force in the Division of Enforcement. Consistent with increasing investor focus and reliance on climate and ESG-related disclosure and...more

SEC Charges AT&T and Three Executives with Selectively Providing Information to Wall Street Analysts to Talk Down Estimates

On March 5, 2021, the Securities and Exchange Commission charged AT&T, Inc. with repeatedly violating Regulation FD, and three of its Investor Relations executives with aiding and abetting AT&T’s violations, by selectively...more

Acting SEC Chair Orders Review of Climate Disclosures

In a public statement Acting SEC Chair Allison Herren Lee noted that he had directed the Division of Corporation Finance to enhance its focus on climate-related disclosure in public company filings....more

ISS Issues Compensation and Equity Compensation Plan FAQs for 2021

ISS has posted its usual suite of interpretive material for the upcoming proxy season. The Compensation FAQs note exceptional circumstances of the COVID-19 pandemic and its impact on company operations will be considered...more

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