A Rule 10b5‐1 plan is a written securities trading plan that is designed to comply with Rule 10b5‐1(c) of the Securities Exchange Act of 1934, as amended.  Any person or entity executing pre‐planned transactions pursuant to a Rule 10b5‐1 plan that was established in good faith at a time when that person or entity was unaware of material non‐public information has an affirmative defense against accusations of insider trading, even if actual trades made pursuant to the plan are executed at a time when the person or entity may be or is aware of material, non-public information.  Company insiders and large stakeholders should revisit establishing a Rule 10b5-1 plan during upcoming clean window periods post earnings announcements.

Our What’s the Deal? discusses Rule 10b5-1 Plans and the SEC’s 2022 amendments to the rules and new disclosure requirements.

Webinar | January 28, 2025
Register here.
12:00 p.m. – 1:30 p.m. EST

On October 12, 2023, Mayer Brown’s cross-practice team presented a webinar on Insurance Company Investments in Mortgage Loans.  If you missed our comprehensive overview on legal and practical considerations arising from such investments, you can review the webinar and related materials here. On January 28, 2025 we will provide an update on recent important developments relating to insurance company mortgage investments, including opportunities to use affiliated fund structures to invest in residential mortgage loans at an attractive risk-based capital charge.

This is the first of two webinars we will offer relating to insurance company investments. Part II: Rated Note Feeder Funds will be on February 11. Invitation for that installment to follow.

January 15, 2015
1:00 – 6:45 p.m. EST

This highly anticipated in person only event will feature expert insights and actionable strategies to help you navigate the shifting landscape and capitalize on emerging trends in the year ahead.

The Agenda will include:

  • US Government Policy Updates and Geopolitical Risks
  • Consumer, Insurance Bank and other Regulatory Updates
  • CLOs and CFOs
  • Capital Relief Trade
  • Capital Call Lines and Joint Ventures
  • Trade Receivables
  • Cryptocurrencies, Emerging Asset Classes, Vertical Integration and Tax
  • SEC updates and much more

For additional information or to register, please contact Jeanette Ponce at jponce@mayerbrown.com.

On December 31, 2024, the Financial Industry Regulatory Authority, Inc. (“FINRA”) issued Regulatory Notice 24-18 (“RN 24-18”) to provide updated guidance to members regarding Rules 15c3-1, 15c3-3 and 17a-5 under the Securities Exchange Act of 1934 (“SEA”), Rule 204 under Regulation SHO, FINRA Rules 4210, 4230(b), 4521 and 4524, and Regulation T of the Federal Reserve Board in the event of an unexpected close of securities markets, such as a national day of mourning declared by the President of the United States.

RN 24-18 follows the death of former President Jimmy Carter on December 29, 2024.  As discussed in our previous blog post, pursuant to a proclamation of the current President of the United States on December 30, 2024, January 9, 2025 has been declared a national day of mourning, and the federal government will be closed that day.  The New York Stock Exchange (NYSE) and Nasdaq have announced that those exchanges will be closed on January 9, 2025, for equities trading.  However, the Depository Trust & Clearing Corporation (DTCC) has announced that it and its subsidiaries will be open on January 9, 2025 to clear and settle securities trades from earlier market activity and to conduct all other normal business activities.

RN 24-18 addresses, among other things, the circumstances under which the day of the unexpected close of securities markets (such as January 9, 2025) should be considered a regular business day versus a non-business day for purposes of certain broker-dealer financial, operational and reporting rules. RN 24-18 updates and replaces the guidance previously set forth in FINRA Regulatory Notice 18-39. 

RN 24-18 can be accessed here.

As a result of the Executive Order of December 30, 2024, the federal government will be closed on January 9, 2025, for President Carter’s funeral.  The NYSE and the Nasdaq have also announced that those exchanges will be closed on January 9, 2025, for equities trading.

There have been two more announcements related to January 9, 2025:

This unscheduled holiday has several effects on the securities practice:

  • Because the SEC’s EDGAR filing system will be closed, January 9, 2025, will not be counted in the Rule 424(b) filing timing requirements.  For example, an offering that prices on January 7, 2025, and is required to be filed under Rule 424(b)(2) must be filed by 5:30 p.m. on January 10, 2025.  Rule 424(b)(2) offerings that price on January 8, 2025, must be filed by 5:30 p.m. on January 13, 2025.
  • Due to the exchanges also being closed, check the relevant underlying documents and definitions to determine if any valuation or observation dates falling on January 9, 2025, will be postponed.
  • Depending on the definition of “business day,” it is possible that, under an issuer’s offering documents, January 9, 2025 may not be a business day as some definitions exclude any day that is a legal holiday.  Some definitions of a New York “business day” only exclude days when banks in New York City are closed.  For those definitions, January 9, 2025, will be a good business day, as banks in New York City, as of this writing, will be open.
    • If the definition of “business day” also excludes legal holidays, now that January 9, 2025, is a federal holiday, it is also no longer a business day under such a definition.
    • Check your underlying documents – if a payment date must fall on a good business day and January 9, 2025, is not a good business day under the controlling documents, then the payment will be postponed – even though banks in New York City and settlement services will be open.

For valuation or observation dates occurring prior to January 9, 2025, but settling after that date, if the intervening days are defined as business days, the underlying documents should be checked to determine if the settlement date will be required to be pushed out one additional day.

[Updated Jan. 2, 2025. Originally posted Dec. 31, 2024]

Webinar | January 15, 2024
Register here.

During this session, Mayer Brown panelists, Brian Hirshberg, Jason W. Parsont, Thomas Kollar, and Gilat Abraham Zaefen will discuss US SEC disclosure priorities and other recent developments for foreign private issuers (FPIs) that should be priorities as they draft their annual reports.  Topics will include:

  • Artificial Intelligence
  • Cybersecurity and climate change disclosure trends
  • The SEC staff’s comments on clawback and pay versus performance issues
  • Insider trading and beneficial ownership rules
  • Financial reporting issues, including non-GAAP disclosures, critical accounting estimates in MD&A and segment reporting
  • China-related matters, including the HFCAA and potential tariff risk factors
  • Considerations related to risk factor disclosures
  • Areas of likely SEC focus in the coming months
United States
8:00 a.m. – 9:00 a.m. EDT
7:00 a.m. – 8:00 a.m. CDT
6:00 a.m. – 7:00 p.m. MDT
5:00 a.m. – 6:00 a.m. PDT		Europe
1:00 p.m. – 2:00 p.m. GMT
2:00 p.m. – 3:00 p.m. CET		Asia
9:00 p.m. – 10:00 p.m. HKT
9:00 p.m. – 10:00 p.m. SGT
10:00 p.m. – 11:00 p.m. JST

On December 20, 2024, FINRA requested public comment on its proposed rule changes to Rules 5110 (Underwriting Terms and Arrangements), 5121 (Public Offerings of Securities With Conflicts of Interest) and 5123 (Private Placements of Securities).  These proposed rule changes stem from comments received from the public in response to the May 2023 Regulatory Notice 23-09, which we blogged about, that relate to rules that impact capital formation.

Rule 5110 prohibits unfair underwriting arrangements in connection with the public offering of securities.  FINRA’s proposed amendments would use a valuation method that is based on the closing price of a security traded on a securities exchange for securities deemed underwriting compensation and also include new exceptions from underwriting compensation, including a new principles-based approach that excludes seed capital investments from being deemed underwriting compensation. 

Rule 5121 applies to public offerings of securities in which a member or its affiliates has a conflict of interest.  If a member has a conflict of interest, a qualified independent underwriter is required to conduct due diligence for the member to participate in the offering unless the securities offered have a bona fide public market.  FINRA proposes to replace the “bona fide public market” condition with a standard that requires the issuer to have been a reporting company for at least one year, be current in its reporting requirements and have an aggregate market value of common equity of at least $300 million. 

Rule 5123 requires members to file with FINRA any private placement memorandum, term sheet or other offering document used in connection with a private placement of securities within 15 calendar days of the date of first sale.  FINRA’s proposal importantly amends Rule 5123 to expand its exemptions from the filing requirement to be consistent with the SEC’s expanded treatment of the accredited investor definition.

Comments must be received by FINRA on or prior to March 20, 2025.  FINRA’s notice can be found here, which includes the proposed rule text changes in an appendix.

On December 16, 2024, the Securities and Exchange Commission (“SEC”) adopted amendments (the “Amendments”) requiring the electronic filing, submission, or posting of certain forms required under the Securities Exchange Act of 1934 and the rules and regulations thereunder, using structured, machine-readable data language as appropriate. The SEC also adopted amendments to the Financial and Operational Combined Uniform Single (“FOCUS”) Report. Registrants should note that the mandate to use structured, machine-readable data language could present additional compliance costs and is accompanied by a risk that the technology could eventually become obsolete as new technology is developed.

Key Requirements under the Amendments:

Broker-Dealers and Security-Based Swap Dealers and Major Security-Based Swap Participants (collectively, “SBS Entities”)

  • Broker-dealers and non-bank SBS Entities must file the annual audited reports, and, for broker-dealers, Form 17-H, electronically on EDGAR.

Covered Self-Regulatory Organization (“SRO”) Forms

  • SROs must file electronically on EDGAR Form 1, Form 1-N, Form 15A and Form CA-1.
  • The Amendments also (i) rescind Form 19b-4(e) and require information related to the listing and trading of new derivatives securities products be posted publicly on the relevant SRO’s website and (ii) remove the manual signature requirements for Form 19b-4.

Registered Clearing Agency Supplementary Materials

  • Registered clearing agencies must post any supplementary materials to their websites within two business days.

Other Forms, Reports or Notices

  • Registrants must file the following on EDGAR: (1) Rule 17a-19 notices; (2) Rule 3a71-3(d)(1)(vi) notices, and withdrawals of such notices as required under the Amendments; (3) Rule 15fi-3(c) notices; and (4) Rule 15fk-1(c)(2)(ii)(A) reports.

Structured Data Requirements

  • Registrants must file certain documents in an Inline eXtensible Business Reporting Language or a custom eXtensible Markup Language (“XML”). Rule 19b-4(e) postings must use an XML schema and associated PDF renderer from the SEC’s website.

FOCUS Report Revisions

  • The SEC adopted amendments regarding the FOCUS Report to harmonize with other rules, correct technical errors, and provide clarifications, as well as to allow electronic signatures in Rule 17a-5, 17a-12, and 18a-7 filings, including the FOCUS Report.

General Compliance Date: The Amendments will become effective 60 days after publication in the Federal Register. The compliance date of the Amendments will begin on their effective date, except as noted in the table below.

Key Compliance Dates

Broker-Dealers and SBS Entities
June 30, 2025Annual audits (i.e., Form X-17A-5 Part III) and Form 17-H filings due on or after this date filed on EDGAR in PDF format.
June 30, 2026Annual audits of firms with a minimum fixed dollar net capital requirement greater than or equal to $250,000 as of December 31, 2024, due on or after this date filed on EDGAR in structured data format (“SDF”).
June 30, 2028Annual audits of all other firms due on or after this date filed on EDGAR in SDF.
June 30, 2025OTC derivatives dealers file FOCUS Report Part II on SEC eFOCUS system.
March 1, 2026Amendments to FOCUS Report Parts II, IIA, and IIC apply to filings due on or after this date.
March 31, 2026Form 17-H filings due on or after this date filed on EDGAR in SDF.
SROs
September 1, 2025SROs required to post website information required under Rule 19b4(e) for filings due on or after this date.
March 2, 2026Amendments to Form 1 apply to filings due on or after this date.
April 30, 2026Amendments to Form CA-1 apply to filings due on or after this date.
July 1, 2026Amendments related to Forms 1-N and 15A apply to filings due on or after this date.
Other Forms, Filings and Submissions
January 1, 2026Amendments to Rules 15fi-3(c) and 3a71-3(d)(1)(vi) apply to notices submitted on or after this date.
January 1, 2026Reports pursuant to Rule 15fk-1(c) filed on or after this date must be filed on EDGAR in SDF.
December 31, 2026Form X-17A-19 due on or after this date must be filed on EDGAR in SDF.

The US Securities and Exchange Commission (SEC) has adopted amendments that will change the way filers access and manage their accounts on EDGAR (changes collectively referred to as “EDGAR Next” by the SEC). Among other things, EDGAR Next will phase out and ultimately eliminate the EDGAR access codes that filers (and financial printers and other filing agents) currently use to log in to EDGAR and make filings.

If you are a current EDGAR filer, even if you only make a few filings a year, you need to be prepared for EDGAR Next and be ready to enroll on the EDGAR Next dashboard within the transition period. This Legal Update notes important transition dates and answers frequently asked questions about the changes.

Continue reading this Legal Update.

Christmas is coming early to the ESG bond market as the new EU Green Bond Standard applies from 21 December 2024.

The new standard is conceptually similar to existing ICMA use of proceeds standards but quite different in the detail.

Under the standard, net proceeds, subject to certain exceptions, must be allocated to EU taxonomy-aligned activities and Issuers must fulfil various reporting and information requirements in accordance with new pre and post issuance disclosure templates. Issuers are also required to obtain an external review on a new European green bond fact sheet and certain allocation reports. There will be an ESMA supervision regime for external reviewers subject to a transitional period.

Whilst the new standard remains voluntary, Issuers must also adhere to certain other requirements in order to use the “European Green Bond” or “EUGB” label.

In particular, the EU Green Bond Standard can only be used by Issuers that publish a prospectus under the EU Prospectus Regulation (with the exception of those EU sovereign and quasi sovereign entities that are exempt).

In this presentation, we take a look at the key elements of the EU Green Bond Standard, including the distinctions from the ICMA Green Bond Principles and some important documentation considerations.

Please click here for further details and feel free to contact any of the team if you would like to know more.