June 14, 2023
Transcript: “Managing the New Buyback Disclosure Rules”
We’ve posted the transcript for our recent “Managing the New Buyback Disclosure Rules” webcast featuring Era Anagnosti of DLA Piper, Robert Evans of Locke Lord, Allison Handy of Perkins Coie, and Dave Lynn of Morrison Foerster and TheCorporateCounsel.net. Here’s an excerpt from Era Anagnosti’s comments on disclosure controls related to the new requirement to disclose the objectives or rationale of the repurchase program and the process or criteria for determining the amount of repurchases:
I also would focus on ensuring proper documentation for substantiating the objectives and the process used to determine the amount of repurchases. The board approves these repurchases, so it’s critical that in carrying out their fiduciary duties, the board’s process for determining these criteria and establishing the repurchase program is sound from a risk and liability perspective, considering the new disclosure requirements put a spotlight on this process.
We had several clients raise questions around, “What about existing repurchase programs that may still be effective by the time the rules go live?” Go back to look at what the board articulated as an objective and criteria at the time. That may not necessarily be up to par with a new disclosure requirement. It’s important for the board to reassess the objective and criteria of previously approved plans.
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– Meredith Ervine