Yesterday, the SEC announced that Christina Thomas will rejoin the agency to as Deputy Director of the Division of Corporation Finance and chief advisor on disclosure, policy, and rulemaking. Christina is currently a partner at Kirkland & Ellis and previously served as a senior advisor at the SEC, most recently as Counsel to SEC Commissioner Elad L. Roisman. Here’s an excerpt from the SEC’s press release announcing her appointment:
“Christina brings her deep technical experience in disclosure, compliance, and international securities law back to the Commission at a critical time,” said SEC Chairman Paul S. Atkins. “Her expertise will contribute meaningfully to the Division’s goals of facilitating capital formation and protecting investors in the modern operating environment.”
“Christina is a talented attorney with a deep understanding of corporate disclosure matters,” said James Moloney, Director of the Division of Corporation Finance. “Her experience, intellect, and practical ideas will be wonderful assets to our work in the Division and will support the Commission’s mission.”
With the SEC contemplating an overhaul of both the executive compensation disclosure rules and Regulation S-K, Christina is certain to have a lot on her plate. Fortunately, she’ll have some help, because the SEC separately announced the members of the team of senior Corp Fin staff who will be responsible for advising Director Jim Moloney on all matters the Division has before the Commission, “including rulemaking efforts, corporate disclosure matters, and all day-to-day operations needed to fulfill the SEC’s mission.”
Over on Cooley’s CapitalXchange Blog, Liz recently posted about a Nasdaq proposal to amend Rules 5450 and 5550 to impose a $5 million minimum market cap requirement on companies listed on Nasdaq’s Global and Capital Markets. Here’s an excerpt from her blog with some details about the proposal:
Nasdaq has proposed a new continued listing standard for companies listed on its Global and Capital Markets tiers. The proposed rule, which would amend existing Rules 5450 and 5550, would require these companies to maintain a minimum Market Value of Listed Securities of at least $5 million.
Nasdaq believes that once the market identifies significant problems in a company by assigning a very low market value, that company is no longer appropriate for continued listing and trading on Nasdaq because challenges facing such companies, generally, are not temporary and may be so severe that the company is not likely to regain compliance within a compliance period and sustain compliance thereafter. In Nasdaq’s view, it is also more difficult for market makers to make markets in the securities of these nano-caps, and for there to be a fair and orderly market.
Nasdaq is also proposing an amendment to Rule 5810 that would suspend trading and immediately delist from Nasdaq the securities of companies that do not satisfy the proposed new market cap requirement for 30 consecutive business days. The staff’s delisting notice would inform the company that its securities are immediately suspended from trading and subject to delisting.
Companies would not have a cure period to regain compliance with the market cap standard or be entitled to any stay in effectiveness. A company would be permitted to appeal the delisting decision to the Hearings Panel, but its securities would generally trade on the over-the-counter market while the review is pending, rather than on the exchange, and the Hearings Panel would not be able to grant an exception to the continued listing standard.
The rule proposal would also tie the Hearings Panel’s hands pretty tightly – it could overturn a delisting decision only if it finds that Nasdaq got the math wrong and the company never actually failed to satisfy the minimum market cap requirement. Other matters, such as the company’s subsequently regaining compliance with the requirement, could not be considered by the Panel.
This hasn’t hit the SEC’s website yet, but keep an eye out for it. Also, Liz’s blog covers a bunch of other recent Nasdaq rulemaking, so be sure to check out the whole thing.
We’ve blogged a few times about New York’s Martin Act and the NY AG’s eagerness to capitalize on statute’s seemingly limitless scope (see 2nd & 3rd blogs). Last week, the NYT reported that NY AG Letitia James has recently trotted out the Martin Act to target an area usually addressed by the feds – insider trading. Here’s an excerpt:
Attorney General Letitia James of New York filed an insider trading lawsuit on Thursday against a former biotech chief executive, accusing him of turning a $7.6 million profit on the sale of the company’s stock before the public learned that millions of doses of a Covid-19 vaccine were contaminated.
Filed in a New York State court, the lawsuit said that Robert G. Kramer, who was the chief executive of Emergent BioSolutions, knew of the systemic problems involving a vaccine it was helping AstraZeneca produce as part of the federal government’s Operation Warp Speed when he exercised his stock options.
The vaccine makers had to discard the tainted material and suspend production, sending Emergent’s stock into a free fall from its high of $134.46 a share in August 2020, according to the lawsuit.
Aside from the legal action against Mr. Kramer, who retired from Emergent in 2023, Ms. James announced on Thursday that the company, which is based in Gaithersburg, Md., would pay $900,000 as part of a settlement in connection with the insider trading case.
The Times says that the AG alleges that the former CEO’s conduct violated the Martin Act, while the former CEO denies wrongdoing. Interestingly, this isn’t the first time NY has used the Martin Act to target insider trading. In 2021, AG James used the statute to compel testimony and document production in an insider trading investigation aimed at Eastman Kodak.
Tune in at 2:00 pm Eastern today – Tuesday, January 20th – for our annual 90-minute webcast, “The Latest: Your Upcoming Proxy Disclosures.” We’ll hear from Mark Borges of Compensia and CompensationStandards.com, Alan Dye of Hogan Lovells and Section16.net, Dave Lynn of Goodwin Procter and TheCorporateCounsel.net and Ron Mueller of Gibson Dunn on a variety of compensation “hot topics” – including:
– Status of SEC Executive Compensation Disclosure Requirements
– Other Possible Topics for SEC Review
– Incentive Compensation – Disclosure Considerations for Tariff Challenges and Discretionary Adjustments
– Executive Security and Other Key “Perks” Disclosures
– Investor Perspectives: “Homogenization” and Performance Equity
– Proxy Advisors – Impact of the Executive Order
– Proxy Advisors – Voting Policy Updates for 2026
– Proxy Advisors – Impact of Announced Move Towards “Customization” of Voting Policies
– Proxy Advisors – Status of Legal Challenges in Texas and Florida
– New Challenges with Shareholder Engagement
– Clawback Policies – Lessons from 2025
– Compensation-Related Shareholder Proposals in 2026
– ESG and DEI Goals: Impact of Shifting and Conflicting Perspectives
– Managing Stock Price Volatility When Granting Equity
Members of this site can attend this critical webcast at no charge. If you’re not yet a member, you can sign up by contacting our team at info@ccrcorp.com or at 800-737-1271.. Our “100-Day Promise” guarantees that during the first 100 days as an activated member, you may cancel for any reason and receive a full refund. The webcast cost for non-members is $595.
We will apply for CLE credit in all applicable states (with the exception of SC and NE who require advance notice) for this 1-hour webcast. You must submit your state and license number prior to or during the live program using this form. Attendees must participate in the live webcast and fully complete all the CLE credit survey links during the program. You will receive a CLE certificate from our CLE provider when your state issues approval; typically within 30 days of the webcast. All credits are pending state approval.
This program will also be eligible for on-demand CLE credit when the archive is posted, typically within 48 hours of the original air date. Instructions on how to qualify for on-demand CLE credit will be posted on the archive page.
Foley & Lardner’s Patrick Daugherty recently shared his article “10 FAQ About Crypto for Corporate Directors” with us. This resource covers a lot of the basics about digital assets and serves as a good starting point for helping you to educate private and public company directors about crypto. This excerpt addresses the differences between the traditional financial system and decentralized finance typically associated with crypto assets:
Traditional finance (sometimes called “TradFi”) differs from decentralized finance (“DeFi”) with respect to control. TradFi is controlled by banks and governments. DeFi is controlled by code. US dollar deposits, stocks and bonds are traditionally custodied in and by banks, broker-dealers and clearing agencies and are bought, transferred and sold using exchanges and those other TradFi institutions. The assets are controlled by centralized entities and identifiable human beings. Most crypto assets, in contrast, can be held and transferred without an intermediary. They can be transferred using personal computers and the internet from one person’s “wallet” to another’s wallet.
Metamask and Ledger are two well-known wallet providers. This is “peer-to-peer” transfer. That said, there are centralized crypto exchanges, such as Coinbase and Crypto.com, that can be used to transfer and custody crypto assets. And there are decentralized exchanges, such as Uniswap, where crypto assets are bought and sold peer-to-peer, with no human involvement other than the buyer and the seller. The Cube Exchange is a hybrid exchange, combining centralized ordermatching with decentralized custody and settlement.
Topics addressed in the FAQs include, among others, “what is crypto?” “Is crypto lawful?” “What do Miners do? What is Proof of Work? Proof of Stake?” “What are ‘utility tokens’?” and “What is a ‘stablecoin,’ and how does it compare to crypto assets like BTC and ETH?”
Public company boards are accustomed to scrutiny from a variety of sources, including regulators, investors, analysts, reporters, influences, and whistleblowers. This Skadden memo says that “watchdogs” that don’t have a stake in the company but demand board action on their hot-button issues should be added to that list, and that boards should take their demands seriously:
Boards may wonder whether they are obligated to respond to watchdogs or other third parties raising concerns about critical company issues. The board must exercise judgment in each instance about whether and how to respond. As a practical matter, however, the board should at least consider a watchdog’s demands and document its response and reasoning. Doing nothing can be risky for several reasons:
– Watchdogs may identify real issues that, if addressed, could benefit the company.
– If ignored, these demands could later be cited as “red flags” in litigation or regulatory investigations, suggesting the board failed in its oversight duties.
– Plaintiffs’ lawyers and regulators often use hindsight to argue that ignored warnings were clear signs of deeper problems.
The memo provides guidance to boards on how to evaluate and respond to watchdogs, and says that in order to appropriately fulfill their oversight responsibilities, boards “should respond as they would to similar issues raised by whistleblowers, shareholders or government agencies.”
Yesterday, the SEC announced that Corp Fin’s Deputy Director, Cicely LaMothe, had retired from the agency after 24 years of service. Ms. LaMothe served as Acting Director of Corp Fin prior to Jim Moloney’s appointment to the position of Director in September of this. Here’s what Director Moloney had to say about her tenure at the SEC in announcing her departure:
“Cicely has gone above and beyond the call of duty over the past twenty-four years to serve the public in her many critical roles in the Division of Corporation Finance,” said Jim Moloney, Director of the Division of Corporation Finance. “Throughout her tenure she has contributed her passion, commitment, and accounting expertise to support our mission – to ensure investors have the information they need to make informed decisions. She will be sorely missed, and we wish her all the best on her next chapter.”
Cicely LaMothe held a variety of senior positions at the SEC since joining the agency in 2002. In addition to her time as Acting Director of Corp Fin, these included service as Program Director of the Disclosure Review Program, Associate Director of the Office of Assessment and Continuous Improvement, and Associate Director of Disclosure Operations before being named Deputy Director for Disclosure Operations in 2022. We join Director Moloney in wishing her all the best going forward.
According to PwC’s 2026 US Capital Markets Outlook, the state of the IPO market in 2025 gives us plenty of reasons to think that 2026 will be a strong year. Here are some of the signs of strength that PWC cites in its report:
– Through November 30, 72 traditional IPOs have raised more than $33.6 billion—surpassing the full-year totals of 2024 (62 IPOs; $27 billion), 2023 (35 IPOs; $17.7 billion), and 2022 (28 IPOs; $7.1 billion). Momentum accelerated meaningfully in late summer and early fall, with September becoming the busiest month for new listings in years.
– Notably, eight companies were still able to price their IPOs during the October-early November government shutdown, underscoring the depth of investor appetite and the resilience of the issuance window. The shutdown did, however, pause SEC operations and delay several in-process offerings, ultimately pushing many issuers into 2026.
– Sponsor-backed IPO activity strengthened further in 2025, marking the busiest year for sponsor-backed issuance since 2021. Year to November 30, 17 sponsor-backed companies have raised more than $8.9 billion, already surpassing the full-year total for 2024, when 13 deals raised $8.8 billion. The 2025 cohort has delivered an average return of approximately 22% since debut, reflecting solid investor demand for scaled, cash-generative businesses with clear deleveraging paths.
– VC-backed IPOs also strengthened in 2025. Year to November 30, 34 VC-backed companies have raised approximately $16.4 billion, compared to 29 issuers raising more than $8.6 billion in all of 2024. Although fewer in number than in earlier cycles, the 2025 cohort has been larger, more profitable and more operationally mature than their 2021 counterparts.
– SPAC issuance posted its most active stretch since 2021. Year to November 30, 122 SPACs have raised approximately $22.2 billion, far surpassing the 57 SPAC IPOs that raised $8.7 billion in 2024.
Sectors that PwC expects will lead the IPO charge in 2026 include AI infrastructure, insurance and specialty risk companies, and software—particularly AI-enabled platforms. It says that momentum is also building in industrials and the manufacturing sector, including reshoring, aerospace and defense.
Revitalizing IPOs was a topic that featured prominently in SEC Chairman Paul Atkins’ recent speech on revitalizing America’s markets at the NYSE. During his remarks, he stressed that “[r]aising capital through an IPO should not be a privilege reserved for those few “unicorns,” and discussed regulatory reforms designed to enhance the IPO on-ramp and make it easier for smaller companies to engage in initial public offerings.
This recent Mayer Brown blog says that it will take more than regulatory changes like these to bring back small cap IPOs:
While all of these measures are undoubtedly important and necessary steps to improve capital formation, there are significant issues that disproportionately affect smaller companies that would not be addressed by any on-ramp regardless of its slope or length. Since the 1990s, the market has changed. There are fewer institutional investors focusing on small- and mid-cap stocks. We cannot make them reappear.
There is less research coverage dedicated to smaller companies—this is well documented by the reports that have been published over the years by the Office of the Advocate for Small Business Capital Formation. The lack of research coverage negatively impacts the liquidity of the securities of smaller public companies.
This, in turn, makes it more difficult for these companies to raise capital in follow-on offerings and raises their cost of capital even though these companies chose to become public, in part, to improve their access to capital and to lower their cost of capital. The companies are then forced to turn to less appealing, higher cost capital-raising alternatives that also are more dilutive. That negatively impacts their stock price. A downward spiral.
While these market conditions aren’t likely to be fixed through regulatory reform, the blog highlights some additional regulatory impediments that the SEC should consider addressing beyond enhancements to EGC status and tweaking filer status thresholds and filer status-based disclosure requirements.
In particular, the blog notes how the stock exchanges’ shareholder approval requirements for private placements in close proximity to M&A transactions have a disproportionately negative impact on smaller public companies, and how Staff interpretations of the volume limits in the baby shelf rules also negatively impact smaller issuers.
Nasdaq’s recent rule proposal to expand trading hours for listed equities and exchange-traded products to 23 hours a day, five days a week has prompted some pushback from others on Wall Street who think it’s a terrible idea. Here’s an excerpt from a recent article in The Street:
A lot of people on Wall Street think this is the wrong answer to a real problem. According to Forbes reporting, Wells Fargo analysts blasted the proposal as “the worst thing in the world,” arguing it would further “gamify” stocks and make equity trading look even more like a casino.
Their core argument is simple: liquidity in U.S. stocks is already heavily concentrated around the opening and closing bells, while off-peak hours are thinner and more fragile.
“Most of the complaints I hear about market structure are about poor volumes,” a Wells Fargo trading desk memo said, questioning why the response is to stretch trading across even more hours.
Jay Woods, chief global strategist at Freedom Capital and a veteran NYSE floor broker, told CNBC that companies and investors need “time to pause” to process information, hold meetings, and release news without an active tape reacting instantly. He warned that nonstop or near-nonstop trading “opens up a new set of challenges,” including burnout for traders and executives and less time for thoughtful decision making.
Concerns include spreading volume over a greater number of hours, which critics fear could lead to wider spreads and greater volatility. That volatility could be exacerbated by market reactions to overnight news, which the article says could result in investors waking up to discover “a stock blasted 10% higher or lower on thin overnight volume, driven more by traders’ knee-jerk reactions than by calm analysis. Critics also cite the higher costs resulting from competitive pressures on banks and brokerages to staff desks for overnight trading.
Proponents of 24/5 trading argue that current practices are out of sync with how people want to trade, and as Liz blogged earlier this year when Nasdaq first revealed its intention to move in this direction, the SEC already approved the “24X Exchange,” which launched in October of this year.
