Rick Lacher Houlihan Lokey Howard & Zukin Investment Banking Services 200 Crescent Court, Suite 1900 Dallas, TX 75201 Phone: (214) 220-8490

Slides:



Advertisements
Similar presentations
Matrix Settlement & Clearance Services, LLC is a wholly owned subsidiary of MG Colorado Holdings, Inc. Affiliates include: MSCS Financial Services, LLC.
Advertisements

2010 DODD-FRANK ACT EXECUTIVE COMPENSATION REFORM Presented by Andrew B. Coburn Wyche Burgess Freeman & Parham, P.A. August 25, 2010 Copyright 2010 Wyche.
Tender Offer Revival - Evolution of the Best Price Rule June 21, 2007.
NI : Cost Disclosure and Performance Reporting - Recap June 7, 2012 Share the tools.
©2003 Prentice Hall Business Publishing, Auditing and Assurance Services 9/e, Arens/Elder/Beasley The CPA Profession Chapter 2.
MSRB Proposed Rules and Interpretations NALHFA 2011 Annual Educational Conference May 20, 2011.
Sarbanes-Oxley Act of Benefits of Act Three quarters of the financial executives in the Oversight Systems survey said that their company had realized.
ELECTION AND QUALIFICATIONS OF DIRECTORS Robert D. Strahota, Assistant Director * SEC Office of International Affairs Prepared for the panel on Improving.
Sarbanes-Oxley Act. 2 What Is It? Act passed by Congress in response to the recent and continuing corporate scandals. Signed into law July 30, Established.
International Ethics Standards Board for Accountants Internal Audit Bob Franchini Paris June
Outside Business Activities and Selling Away
Dodd-Frank Wall Street Reform and Consumer Protection Act
6/9/2015Copyright 2015 A. C. Sondhi & Associates, LLC1 ASU , ASC 606 Revenue from Contracts with Customers and Proposed ASU, Deferral of Effective.
Current Developments at the PCAOB Ensuring Integrity: 3 rd Annual Auditing Conference at Baruch College December 4, 2008.
1 PREPARING FORM 5500 SCHEDULE C A Presentation of The Profit Sharing/401k Council of America, The Securities Industry and Financial Markets Association.
1. 2 CVM’s OBJECTIVES u to stimulate the creation of savings and their investment in securities; u to promote the expansion and regular and efficient.
© The McGraw-Hill Companies, Inc., 2004 Slide 12-1 McGraw-Hill/Irwin Chapter Twelve Financial Reporting and the Securities and Exchange Commission.
1 8 th Annual Financial Reporting Conference Baruch College Paul Beswick Deputy Chief Accountant April 30, 2009.
Audit Planning and Documentation
Trinidad & Tobago Corporate Governance Code 2013
The Camp Audit “Keep your friends close and your auditor closer”
Role of the IAAM Investment Strategy Team Investment Strategist Process Conduct Capital Markets Research and Analysis Identify Asset Classes Develop Return,
The Many Faces of Disclosure
Institute of Actuaries of India
Fiduciary Standard Implications Regulatory Reform and Implications for the Municipal Bond Market Webinar Sponsored by the Regional Bond Dealers Association.
XBRL Voluntary Program on the EDGAR System April 2005 Brigitte Lippmann Attorney Division of Corporation Finance Jeffrey Naumann Enabling Technologies.
NCS Monthly Webinar Series April Monthly Compliance Checklist: ADV Disclosure Requirements National Compliance Services, Inc. Delray Beach, FL
Issuing Bonds – The Process and the Role of the Registered Municipal Advisor 2013 Michigan Community College Business Officers Association July 25, 2013.
Subsequent events. Academic Resource Center Subsequent events Page 2 Typical coverage of US GAAP ► Subsequent events period ► Type I subsequent events.
NEW SEC AUDITOR INDEPENDENCE REQUIREMENTS Financial Executives International Janet Luallen Director - Technical Activities.
HERMITAGE CAPITAL MANAGEMENT The Role of the Board of Directors in Promoting Corporate Governance by William F. Browder Managing Director, Hermitage Capital.
Investment Adviser Workshop: the New Form ADV Part 2, New Rules, and the IA Switch.
ADB Project TA 3696-PAK, Regulation for Corporate Governance 1 REGULATION FOR CORPORATE GOVERNANCE IN PAKISTAN CAPITAL MARKETS.
SEC Financial Reporting Issues NARUC Subcommittee on Accounting and Finance Jackson Hole, Wyoming October 8, 2007.
7 - 1 Copyright  2003 Pearson Education Canada Inc. CHAPTER 7 Audit Planning and Documentation.
Fee Disclosure Requirements Not FDIC insured. May lose value. No bank guarantee. FOR PLAN SPONSORS How they affect you and your participants.
Copyright 2011 Fennemore Craig, P.C. 1 STANDARDS OF CONDUCT FOR NONPROFIT LEADERS Laura A. Lo Bianco Fennemore Craig, P.C. May 17, 2011.
Corporate “Get-Out-The-Vote” Campaigns: Better Shareholder Communications and Proxy Voting Shareholder Communications Coalition Congressional Staff Briefing.
1 Conference on Accountants’ Liability ALI-ABA Zoe-Vonna Palmrose Deputy Chief Accountant Professional Practice Office of the Chief Accountant U.S. Securities.
© 2003 Haynes and Boone, LLP An Introduction to Going Private Transactions by Jennifer Wisinski June 18, 2003.
By: 1. Kenneth A. Kim John R. Nofsinger And 2. A. C. Fernando.
European Corporate Governance: What are the current issues? European Union Corporate Governance Standards - Working Group Meeting December 17, 2013 Brussels.
For broker-dealer use only. Not for use with the public. PROCU 2012 ANNUAL MEETING REGULATORY UPDATE Michael D. Burns Chief Compliance Officer October.
National Commission for Academic Accreditation & Assessment Developmental Reviews at King Saud University and King Faisal University.
CRM2 – Conforming Amendments to MFDA Rules May 2013 – MFDA Bulletin issued requesting Member feedback on specific areas of NI that require clarification.
Financial Accounting and Its Environment Chapter 1.
2013 FIRM CE Outside Business Activities
The Department of Labor Proposed Regulation Investment Fiduciary Advice: What You Need to Know Now! Juli McNeely, LUTCF, CLU, CFP NAIFA President Kevin.
Need of AS on Related Party Transactions  There is general presumption that transaction reflected in the financial statements are executed on arm’s-length.
AllianceBernstein.com 2010 Regulatory Year in Review Preview of 2011 and Beyond Moderator: Rick Unser, AIF, QPFC, CRPS, Lockton Investment Advisors, LLC.
Regulatory Issues in Investment Research Brian McDonnell Associate
1 CESR-Fin Standing Sub–Committee on Enforcement Lars Østergaard Chairman of SCE/EECS World Bank Conference Advanced Program in Accounting and Auditing.
Discussion of Unpaid Claim Estimate Standard  Raji Bhagavatula  Mary Frances Miller  Jason Russ November 13, 2006 CAS Annual Meeting San Francisco,
PCAOB Inspection Findings PCAOB Audit Committee Dialogue Auditor Assessment Toolkit Doug Morally Senior Audit Manager September 14, 2015.
McGraw-Hill/Irwin © 2003 The McGraw-Hill Companies, Inc., All Rights Reserved. 6-1 Chapter 6 CHAPTER 6 INTERNAL CONTROL IN A FINANCIAL STATEMENT AUDIT.
Proposed ASB Actuarial Standard of Practice on Statements of Actuarial Opinion Regarding Property/Casualty Loss and Loss Adjustment Expense Reserves Status.
McGraw-Hill/Irwin © The McGraw-Hill Companies 2010 Auditing the Human Resource Management Process Chapter Twelve.
 The U.S. Securities and Exchange Commission (SEC) oversees the key participants in the securities world.  Concerned with promoting disclosure of important.
CIEBA Webinar DOL 2015 Fiduciary Proposal Jenny Eller Groom Law Group, Chartered May 20, 2015.
Chapter 9 Mutual Funds as Institutional Investors.
Overview of DOL Fiduciary Rule
The New Fiduciary Rules
CHAPTER 7 Audit Planning and Documentation
Completing the Audit Chapter 24.
Subsequent events.
DOL LANDSCAPE: CHALLENGES AND OPPORTUNITIES
The CPA Profession Chapter 2.
Alignment of Part 4B with ISAE 3000
Summary Prospectuses for Variable Annuity and Variable Life Insurance Contracts SEC’s Proposed Disclosure May 19-21, 2019 ALIC Annual Conference Richard.
Presentation transcript:

Rick Lacher Houlihan Lokey Howard & Zukin Investment Banking Services 200 Crescent Court, Suite 1900 Dallas, TX Phone: (214) NASD Rule 2290 Disclosures and Procedures Concerning the Issuance of Fairness Opinions October 21, 2006

H OULIHAN L OKEY H OWARD & Z UKIN 2 NASD Rule 2290 Timeline and Status  The NASD proposed Rule 2290 on June 24,  The NASD filed amendments with the SEC on November 30, 2005, January 25, 2006, and March 1,  The SEC solicited comments from interested persons on April 4,  On August 24, 2006, the time period for SEC action was extended to November 1. It is not clear whether to expect Commission action by that date or merely another extension.

H OULIHAN L OKEY H OWARD & Z UKIN 3 NASD Rule 2290 Disclosures Any NASD member issuing a fairness opinion that may be provided, or described, or otherwise referenced to public shareholders must disclose, to the extent not otherwise required, in such fairness opinion:  whether such member has acted as a financial advisor to any transaction that is the subject of the fairness opinion, and, if applicable, that it will receive compensation for:  rendering the fairness opinion that is contingent upon the successful completion of the transaction;  serving as an advisor that is contingent upon the successful completion of the transaction;  whether such member will receive any other payment or compensation contingent upon the successful completion of the transaction;  whether there is any material relationship that existed during the past two years or is mutually understood to be contemplated in which any compensation was received or is intended to be received as a result of the relationship between the member and the companies that are involved in the transaction that is the subject of the fairness opinion;  the categories of information that formed a substantial basis for the fairness opinion that was supplied to the member by the company requesting the opinion concerning the companies involved in the transaction and whether any such information in each such category has been independently verified by the member; and  whether the fairness opinion was approved or issued by a fairness committee.

H OULIHAN L OKEY H OWARD & Z UKIN 4 NASD Rule 2290 Procedures Any member issuing a fairness opinion must have procedures that address the process by which a fairness opinion is approved by a firm, including:  the types of transactions and the circumstances in which the member will use a fairness committee to approve or issue a fairness opinion, and in such transactions where it uses a fairness committee:  the process for selecting personnel to be on the fairness committee;  the necessary qualifications of persons serving on the fairness committee; and  the process to promote a balanced review by the fairness committee, including review and approval by persons who do not serve on or advise the “deal team” to the transaction;  the process to determine whether the valuation analyses used in the fairness opinion are appropriate, and the procedures should state the extent to which the appropriateness of the use of such valuation analyses is determined by the type of company or transaction that is the subject of the fairness opinion; and  the process to evaluate whether the amount and nature of the compensation from the transaction underlying the fairness opinion benefiting any individual officers, directors or employees, or class of such persons, relative to the benefits to shareholders of the company, is a factor in reaching a fairness determination.

H OULIHAN L OKEY H OWARD & Z UKIN 5 NASD Rule 2290 SEC’s Solicitation of Comments In the SEC’s Request for Comment, the SEC specifically notes:  The proposed Rule does not require member firms to quantify the amount of contingent fees that will be earned from either the client or others in the transaction. The SEC asks if such quantification should be required.  The proposed Rule requires that a firm state if compensation is contingent. The SEC asks whether in the disclosure it should be stated that a conflict may exist and a description of the impact of such conflict be included.

H OULIHAN L OKEY H OWARD & Z UKIN 6 NASD Rule 2290 Summary of Responses to SEC There were fewer responses than in the NASD’s original request:  The Council on Institutional Investors was the only “investor” to respond. It supported the NASD rule and any expansion of disclosure that the SEC, or others who could impact policy (such as the NYSE and other exchanges), could require.  The Wall Street banking community (through the Securities Industry Association) again responded with a desire for the status quo and to curtail any detailed disclosure of the size of contingent fees relative to the size of the fairness opinion fee.  The NY State Bar and the City Bar of NY again aided the investment banking community with more harshly worded responses that support the NASD rule AS IS (but without increased disclosure requirements) and argue for limitations. The NY Bar even suggests that along with the disclosure of a contingent fee relationship should be an acknowledgement that such relationship does NOT create a conflict of interest.  Generally, the investment banks believe that the evaluation of compensation is not within the members’ role as financial advisor or fairness opinion provider.

H OULIHAN L OKEY H OWARD & Z UKIN 7 NASD Rule 2290 Observations of Change  The SEC has generally increased its disclosure requirements regarding potential conflicts of interest (including in Risk Factors).