SEC Chair Clayton has noted in many public remarks that the growth of the private capital markets have outpaced the U.S. public markets.  Many of the most promising companies now choose to defer their IPOs and remain private, raising capital in successive exempt offerings.  While the JOBS Act brought about a number of changes to, and additions to, the exempt offering framework, that may only have increased complexity.  Earlier this year, the SEC issued a Concept Release on Harmonization of Securities Offering Exemptions that raises a number of fundamental questions for market participants.  Do we have too many exempt offering choices?  Is harmonization required?  How will retail investors participate in the growing private markets?  During this session, Anna T. Pinedo and Michael Hermsen will discuss:

  • Traditional private placements conducted under Section 4(a)(2) and Rule 506(b),
  • The evolution of general solicitation and Rule 506(c),
  • The motivations for using one of these approaches over another,
  • Integration of offerings in close proximity to one another and the changes in integration analyses over the years,
  • Choosing among a Regulation A, a crowdfunded, and a Rule 506(c) offering,
  • Investor qualifications, sophistication and disclosure, and
  • Resale exemptions.

For more information, visit the event’s website.

September 23–24, 2019

PLI California Center
685 Market Street
San Francisco, CA 94105

This program is specifically designed for in-house and law firm attorneys and other professionals who work with financial information. It will enhance understanding of business strategies, accounting fundamentals and vocabulary used by management, investors, auditors and bankers. Practical advice and application of information to actual situations and financial reports will provide participants with opportunities to immediately implement growth and broaden capabilities.

Partner Anna T. Pinedo will participate in a panel discussion titled, “Investment Banking Basics: Fundamentals of Capital Structures” on Day Two of the conference. Topics will include:

  • Common financing alternatives — debt, equity and hybrids
  • Sources of funding — public and private markets
  • Liquidity — raising and deploying capital
  • Finding the Optimal Capital Structure
  • Current marketplace developments

PLI will provide CLE credit. For more information, or to register, please visit the event website.

In this Lexis Practice Advisor® Practice Note, we discuss the amendments proposed by the U.S. Securities and Exchange Commission (SEC) on May 3, 2019 in connection with financial statement disclosures on business acquisitions and dispositions as required by Regulation S-X’s (17 C.F.R. §§ 210.1-01 – 12-29) Rule 3-05 (Financial Statements of Businesses Acquired or to be Acquired (Rule 3-05), Rule 3-14 (Special Instructions for Real Estate Operations to be Acquired (Rule 3-14)), Article 11 on Pro Forma Financial Information (Article 11), and other related rules and forms.

In this article published in The Review of Securities & Commodities Regulation, we discuss the implications of the SEC’s recent actions to modernize and simplify disclosure requirements applicable to foreign private issuers (“FPIs”).

See full article here.

Thursday, October 24, 2019

Please join Mayer Brown at IFR’s US ECM Roundtable 2019. Now in its eighth year, the event will bring together a panel of the most senior ECM practitioners to assess the current state of the market, discuss the latest trends and developments and provide an outlook for the remainder of the year and beyond. Topics for discussion will include:

• State of the IPO market
• Transformative industries and companies
• Direct Listings as an alternative to IPO
• SPACs: Financial Engineering in bull market or durable funding vehicle?
• Market Outlook

For more information, or to register, please visit the event website.

At the Economic Club of New York, in keynote remarks, Chair Clayton reviewed the Securities and Exchange Commission’s recent initiatives.  He highlighted the Commission’s adoption of Regulation Best Interest (Reg BI).  Repeating a common theme, Chair Clayton discussed concerns relating to increased reliance on the private capital markets.  Clayton noted that, while twenty-five years ago, the public markets dominated the private markets in virtually every measure, today, the private markets outpace the public markets, including in aggregate size.  Given the audience, Chair Clayton’s remarks highlighted the inefficiencies of the current regulatory framework for public and private markets and noted that the Commission is addressing both.  He cited a number of initiatives undertaken in order to increase the attractiveness of the U.S. public markets.  Commenting on exempt offering alternatives, Chair Clayton cited the changes brought about by the JOBS Act, including amended Regulation A, crowdfunding, and general solicitation for Rule 506(c) offerings; however, he noted that these advances added “new patches to an already patchwork regulatory framework that remains rooted in income and wealth tests for investor access.”  As suggested by the Commission’s Concept Release on Harmonization of Securities Offering Exemptions, Chair Clayton noted that the Commission was reevaluating the exempt offering framework and assessing the utility of “structured funds” as a means of facilitating Main Street investor access to private investments.  Chair Clayton also commented on developments that the Commission was actively monitoring, which include the growth in corporate debt and the risks associated with the increase in corporate debt held outside of banks, including by funds, as well as banks’ exposure to non-banks.  Chair Clayton also reiterated the Commission’s work relating to the LIBOR phase out and emphasized that market participants should ensure that any contracts that extend beyond 2021 either reference LIBOR and have effective fallback language or do not reference LIBOR.   The Commission, he noted, also is monitoring the impacts of Brexit.  See the complete text of the remarks here.

On September 6, 2019, the Division of Corporation Finance of the US Securities and Exchange Commission announced a significant change to its process with respect to reviewing no-action requests submitted to the Division pursuant to Rule 14a-8 promulgated under the Securities Exchange Act of 1934, as amended.  This Legal Update discusses the change and related considerations for issuers and their counsel.

Our latest market trends article discusses Staff Legal Bulletin No. 14I and Staff Legal Bulletin No. 14J of the Division of Corporation Finance of the Securities and Exchange Commission, both of which provide guidance with respect to shareholder proposals submitted for inclusion in company proxy statements pursuant to Rule 14a-8 under the Securities Exchange Act of 1934, and how such guidance was applied during the 2018 and 2019 proxy seasons.

In this Lexis Practice Advisor® Practice Note, we provide answers to questions frequently asked by securities lawyers and their clients regarding the federal securities laws applicable to Business Development Companies (BDC’s). Specifically, this practice note includes questions related to:

  • Securities offering process;
  • Disclosure and corporate governance obligations;
  • Stock exchange requirements;
  • Commercial and regulatory trends; and
  • Practice tips for counsel.
The US federal banking and functional regulators (“Agencies”) have finalized revisions to the proprietary trading and compliance program provisions of the Volcker Rule, which implement some, though not all, of the changes that had been proposed by the Agencies in a May 2018 notice of proposed rulemaking. This Legal Update discusses the revisions.