On April 28, 2023, the Securities and Exchange Commission announced that it was reopening the comment period for the proposed amendments to modernize the rules governing beneficial ownership reporting filed on Schedules 13D and 13G.  The Staff of the Commission’s Division of Economic and Risk Analysis (DERA) released a memorandum providing supplemental data and analysis relating to the economic effects of the proposed amendments.  The public comment period will remain open until June 27, 2023, or until 30 days after the date of publication of the reopening release in the Federal Register, whichever is later. 

See the fact sheet.

See the DERA Report for supplemental data and analysis on certain economic effects of proposed amendments regarding the reporting of beneficial ownership.

The Securities and Exchange Commission will hold an open meeting on May 3, 2023 at 10 a.m., which will be available to via webcast, the link will be posted shortly before the start of the meeting on the SEC website.

The Division of Corporation Finance will present on share repurchase disclosure modernization. The Commission will consider whether to adopt rule amendments that modernize and improve disclosure about repurchases of an issuer’s registered equity securities.  See our client alert “SEC Proposes New Rules on Share Repurchase Disclosure” and blog posts, “SEC Reopens Share Repurchase Disclosure Modernization Comment Period” and “MB Microtalk: Rule 10b5-1 and Share Repurchase Disclosure“, on the proposed amendments.

The Division of Investment Management will present on Enhancing Private Fund Reporting.  The Commission will again consider, as it did in its open meeting in March, whether to adopt amendments to Form PF, the confidential reporting form. The amendments would require current reporting for certain private fund advisors and revisions to other reporting requirements. The full meeting agenda can be found here.

Sustainability-Linked Bonds: Some practical considerations for documenting and structuring transactions

In this briefing, we take a look at sustainability-linked bonds (“SLBs”), which have fast become an important feature of the sustainable finance market. According to Climate Bonds Initiative, SLB issuance reached US$76.3 billion in 2022 and we have seen an increasingly wide variety of corporate and sovereign issuers take advantage of the structure. 

However, the market has not grown without incident or controversy. Some issuances have attracted accusations of “greenwashing” for a lack of ambition in their targets, the lack of meaningful consequences if a target is not met or where the structure of the SLB does not address the true sustainability challenges of an issuer’s business. SLBs carry with them some particular considerations that should be kept in mind when structuring a transaction and preparing the relevant legal documents and marketing materials.

We take a look at some of these key points in this note. Read more here.

May 2, 2023 Webinar

3:00 pm – 4:00 pm ET

Register here.

A comfort letter is an important document delivered by an issuer’s independent accountants to underwriters or initial purchasers that provides certain assurances with respect to financial information included in the prospectus or offering memorandum used in a securities offering. Underwriting agreements and purchase agreements typically require a comfort letter be provided as a condition at pricing and closing. Comfort letters also assist underwriters in establishing a due diligence defense under the securities laws.

During this session hosted by the Practising Law Insitute, Mayer Brown Partners, Ryan Castillo and Phyllis Korff will discuss the following practice pointers:

  • Comfort letter basics: What, why and when?
  • Auditing Standards No. 6101: Form and contents of a comfort letter
  • Understanding the different levels of comfort
  • Additional practice tips
Although the New Federal Exemption Is Generally Aligned with the SEC’s 2014 No-Action Relief, There Are Some Notable Differences. Moreover, State Law Registration Requirements for M&A Brokers Are Not Preempted.

The U.S. Congress recently enacted a conditional exemption (the “Exemption”) from registration under Section 15(b) of the Securities Exchange Act of 1934 for qualifying brokers that facilitate merger and acquisition (“M&A”) transactions involving certain privately held companies. The Exemption essentially is a codification of relief for certain M&A brokers from the Exchange Act’s broker registration requirements that the staff of the Division of Trading and Markets of the U.S. Securities and Exchange Commission (“SEC”) previously granted in a 2014 no-action letter (“2014 NAL”). However, the Exemption is narrower in that it imposes limitations on the size of the privately held company that is the subject of an M&A transaction. The Exemption became effective on March 29, 2023; that same day, the SEC staff withdrew the 2014 NAL effective immediately.

In this Legal Update, we provide an overview of the Exemption and certain practical considerations, including considerations under state securities laws.

Read the complete Legal Update.

May 11, 2023 Hybrid

5:00 pm – 6:00 pm ET

Register here.

Join Yafit Cohn, Chief Sustainability Officer and Group General Counsel at The Travelers Companies, Inc., as she discusses the importance of ESG for a holistic view of risks and opportunities that could impact a company’s ability to create long-term shareholder value, juxtaposed with the challenges companies face from the hijacking of ESG to advance political goals unaligned with shareholders’ best interests.  Offering cautions about the dangers to public companies lurking in the ESG movement, Cohn will explain how Travelers manages to maintain its focus on shareholder interests amid contrary pressures from multiple constituencies with divergent views on a multitude of issues.  

This event will take place at Mayer Brown’s New York office with an option to join via Zoom.

Learn more about our guest speaker:

Yafit Cohn is Chief Sustainability Officer and Group General Counsel at The Travelers Companies, Inc., where she guides the company through the evolving ESG landscape and leads its integrated sustainability reporting.  A prominent insurance executive and governance expert, Cohn is an active board member of the Society for Corporate Governance, frequent speaker on related topics and recipient of numerous professional awards.  Previous positions involved advising public companies at two major international law firms. 

Visit Across the Board for more views on emerging issues in corporate governance.

This extensive Guide is a practical tool for companies that are considering raising capital through the issuance of high yield bonds.  Written in plain-English, the Guide demystifies and simplifies what for many may seem like a daunting and complex covenant package and offering process.  Covering the full spectrum of what issuers need to know, the Guide begins with an overview of fundamental high yield concepts and then launches into an in-depth discussion of each high yield covenant, explaining how the covenant is structured, what the covenant is designed to achieve, the pitfalls to avoid, and insightful practice tips for novices to keep in mind.  The Guide also provides an overview of the 144A/Reg S offering process, including a discussion of the legal framework, a typical high yield offering timeline and the key transaction documents.  Finally, the Guide concludes with a comparison of the distinguishing characteristics among high yield covenant packages in the United States, Europe and Asia.  

With over 170 pages of content, the Guide is available online now to print.

Request your paperback print copy here or e-mail your Mayer Brown contact directly.

April 24, 2023 Hybrid

5:00 pm – 6:00 pm ET

Register here.

In this session, we will take an in depth at look at greenwashing, regulatory risk, reputational risk and litigation risk in the context of capital markets transactions. In short, an overview of emerging ESG related risks alongside practical tips to help mitigate these risks. We will also provide a brief explanation of the increasingly extensive array of EU and UK sustainable finance legislation that you may encounter on a day to day basis. This session will be of interest to many but particularly in-house legal and business teams at financial institutions.

This event will take place at Mayer Brown’s New York office with an option to join via Zoom.

On April 3, 2023 the U.K. Financial Conduct Authority (“FCA”) announced that it will require the administrator of U.S. dollar LIBOR to continue to publish one, three and six-month U.S. dollar LIBOR settings until September 30, 2024, using an unrepresentative synthetic methodology (“synthetic USD LIBOR”).  Each synthetic USD LIBOR tenor will be the same as the relevant CME Term SOFR rate plus the respective ISDA spread adjustment.  In other words, synthetic USD LIBOR will be the same as the “Board-selected benchmark replacement” for the relevant tenor under the Adjustable Interest Rate (LIBOR) Act (“AIRLA”) and Rule 253.4 of Regulation ZZ.

For issuers of USD LIBOR floating rate notes governed by New York or other U.S. law, synthetic USD LIBOR is irrelevant.  If an issuer of a USD LIBOR floating rate note with a discretionary replacement provision chose synthetic USD LIBOR instead of the Board-selected benchmark replacement, even though they will be the same rate, AIRLA’s safe harbor provisions would not be available to the issuer or the determining person.

Synthetic USD LIBOR could be helpful for an issuer of a U.K. law governed floating rate note linked to USD LIBOR.  A U.K. law governed floating rate note would not be subject to AIRLA or Rule 253.  Depending on how the description of the screen rate is drafted, it is possible that synthetic USD LIBOR could replace USD LIBOR.  Most USD LIBOR floating rate notes, however, describe a replacement for the Reuters Page LIBORO1 setting as a page used to display “interbank lending rates in the London market.”  That description would rule out using synthetic USD LIBOR, even if it appears on Reuters Page LIBOR01 or a successor page, because synthetic USD LIBOR is not an interbank lending rate.

Synthetic USD LIBOR may not be used in new issuances. The FCA announcement is available here.