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Once again, it’s time for the annual list of my favorite books of the year gone by.  As usual, the list consists of books that I read last year, not necessarily books that were published last year.  

With one exception, none of the works of fiction I read in 2023 really blew me away.  For me, great fiction is something that takes me to another place – not necessarily a “fun” place – from my daily grind, and while I have selected my five favorite works of fiction for 2023, only one grabbed me that way.  

Also, I’m adding a few additional categories, including Best Audiobooks, Worst Book of the Year, and Most Disappointing Book of the Year.

Here goes, then….

Non-Fiction

  • King, A Life, by Jonathan Eig: Biography strikes me as one of the most challenging things to write; so many biographies turn into hagiography or a total trashing of the subject.  In stark contrast, this biography of Dr. Martin Luther King, Jr. treats the subject as a man, with failings and strengths like all men.  IMHO, this is a must read for anyone interested in Dr. King and his work.
  • Citizens of London, by Lynne Olson: Ms. Olson’s works excel when she writes about a limited aspect of history; in fact, of the books of hers I’ve read thus far, the ones that don’t succeed try to paint a large canvas.  This book focuses on a few great men who found themselves in London as World War II got underway – Averell Harriman, Edward R. Murrow, and Ambassador John Gilbert Winant (and if you say “John Gilbert who?”, you’re not alone).  Of course, there are many other great men (and quite a few women) who play prominent roles in the events Ms. Olson writes about, but the focus is clearly on those three.  If you are interested in WWII, you should definitely pick this one up.
  • Two Roads Home, by Daniel Finkelstein: A fascinating and eminently readable book about how this British journalist’s parents met, their respective families’ experiences during WWII, and the coincidences that ensued.  
  • Trust the Plan, by Will Sommer: A slim but critical book about QAnon.  It is scary and weird and gripping from start to finish.
  • True Story, by Michael Finkel: Finkel has been much praised for his book The Art Thief, but for my money this one is much more interesting.  It concerns itself with a criminal who posed as the author, who himself was involved in a very well publicized journalism scandal, and their very odd relationship.  

Fiction

  • North Woods, by Daniel Mason: This is the exception I referred to above.  It is a fictional biography of a house in Western Massachusetts over several generations.  First and foremost, Mason’s writing, particularly about the flora and fauna of the area, is splendid.  And while I didn’t find myself sitting at the edge of my seat to find out what happens, there is a story here and it’s very well done.  I’ll also add that I am not a fan of magical realism, but Mason pulls it off very well indeed.
  • The Heaven and Earth Grocery Store, by James McBride: McBride also writes beautifully; in fact, there are some passages that I went back and read a few times for the sheer enjoyment of his prose.  The book was a bit too disjointed and too full of characters for my taste, but everything McBride writes is worth reading, and this is no exception.
  • The Gift of Rain, by Tan Twan Eng: Eng’s three novels all revolve around life in colonial, pre-WWII Malaya, but this one takes us through the war and the hero’s relationship with his sensei and the consequences of that relationship for his role in the war.  The book was a bit too focused on his training and meditation and all that for my taste, but was nonetheless fascinating.
  • The Oppermans, by Lion Feuchtwanger: This book, written in Germany in 1933, concerns itself with an upper class Jewish family that manages to blind itself to what is about to happen.  It is quietly chilling and very well done.
  • Babi Yar, by Anatoly Kusnetsov: The author described this book as a “documentary novel,” which suggests that it might belong in the non-fiction category, but since he called it a novel, I’m not inclined to disagree.  This book is also chilling, particularly when he refers to things like book banning and what it portended for the future in Ukraine in the 1930s.

Best Audiobooks

I’ve taken up listening to audiobooks, though I find I can only listen to works of non-fiction, because there are too many distractions to concentrate on the plot of a mystery or a novel.  My favorites were: 

  • What the Dead Know, written and narrated by Barbara Butcher
  • The Lion House, written by Christopher de Bellaigue and narrated (brilliantly, IMHO) by Barnaby Edwards
  • 1776, written and narrated by David McCullough

Worst Book

Age of Vice, by Deepti Kapoor: The first 100 pages were terrific, but everything after that was a mess.

Most Disappointing Book

The Covenant of Water, by Abraham Verghese: I loved Dr. Verghese’s other books, most particularly Cutting for Stone, but this one was screamingly in need of a good editor.  Characters and plot complications proliferate on every one of its 700+ pages, and the story struck me as pointless.

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I have often said that the SEC is an outstanding agency – for example, see here.  I still believe that, although my belief has been tested in the last couple of years by the “regulatory rampage” in which the SEC has engaged.

But there is always room for improvement, and in a November speech, Commissioner Mark Uyeda offered some significant suggestions that, IMHO, would benefit companies, their stock- and stakeholders, and our capital markets generally.   I urge you to read the speech.  And, more importantly, I urge the SEC to take Commissioner Uyeda’s suggestions seriously.

Here are a few of his key points:

  • Determining the Purpose of Rules:  The first step in rulemaking should be “to answer the question: what problem is the Commission trying to solve?”  Commissioner Uyeda notes that the answer to that question is increasingly that investors desire the information.  In discussions with the SEC staff – particularly in recent years – I’ve heard that a lot.  However, it’s impossible to know whether one or a small number of investors want the information or whether the staff is hearing from lots of investors who want it, and the Commission apparently is not asking why they want it and what use they plan to make of it.  Commissioner Uyeda suggests that the  Commission should inquire into those subjects before running off to adopt rules.  I couldn’t agree more.  All too often, the justification for onerous new rules seems to be that some investors would be interested in the information; I submit that that is not even close to a legitimate basis on which to engage in rulemaking.
  • Re-Proposing Rules:  In the last few years, the SEC has re-proposed a number of rules that were proposed years ago but were not acted upon.  In particular, Commissioner Uyeda refers to the “Pay vs. Performance” rules that were finally adopted in time to impact companies’ proxy statements in 2023.  He notes that certain provisions of the re-proposed rules differed significantly from the originally proposed rules but that the comment period was too short to permit careful consideration of the differences, with the end result that the new rules don’t seem to work in some respects.  His solution is that “[b]efore the Commission adopts any final rule that significantly deviates from the [original] proposal, it should seriously consider re-proposing the rule with the revised rule text and an updated economic analysis.”  Again, I couldn’t agree more.
  • Scalability:  Commissioner Uyeda points out that as far back as 1992, “the Commission recognized that smaller companies ‘are disproportionately affected by…complexities in…disclosure requirements’”, but that many recent rulemakings, including those on cybersecurity, share repurchases, Rule 10b5-1 plans, and clawbacks, do not provide for scaled disclosure.  He also notes that the current classifications of issuers – e.g., “accelerated filers” – don’t really help, pointing out that “an accelerated filer with a $250 million public float [is] subject to the same disclosure requirements as a large accelerated filer with a $250 billion float.”  He doesn’t comment on the impact that unscaled rulemaking has on companies considering going public or public companies contemplating going dark or going private, but I can tell you from personal experience that onerous rules are a big factor in those considerations.
  • Finally, though he doesn’t use the term “regulatory rampage,” Commissioner Uyeda lists the new rules that took effect in 2023 and those that will impact companies’ 2024 disclosures and notes that the cumulative effect of that rampage places incredible pressure on companies (and their counsel), making it very difficult to provide meaningful disclosure: “Given the tight deadlines and resource constraints, it would not be surprising if companies rely more on boilerplate disclosure that provides little or no benefit to investors.”

I would add just one more suggestion, though I can’t take credit for it (those who deserve the credit know who you are).  Specifically, the Commission consults with a variety of groups, such as the Investor Advisory Committee and the Small Business Advisory Committee.  Why not create an “Issuer Advisory Committee” (or something similar) so that, among other things, rulemakings could be discussed and considered – and, ideally, debugged – before they are proposed.  I fervently believe that such a committee could facilitate better rulemaking.  However, I have witnessed several situations in which this suggestion has been dismissed as if it is not even worthy of consideration.  It’s been pointed out that the other advisory committees were mandated by Congress; that may be true, but it’s equally true that the Commission does not need Congressional permission to form such a committee.  

I’m a strong believer in good regulation, and I also believe that suggestions like those above could help to make our public company disclosure regime better.  I hope that someone – aside from Commissioner Uyeda – is listening. 

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We’ve all heard the expression “hard cases make bad law.”  But sometimes bad law is the result of bad cases – i.e., cases that should never have been brought in the first place.  That’s the case with the SEC’s prosecution of Ray Dirks, who died on December 9 at age 89.  I suspect that many of you are too young to have heard of Dirks or the prosecution, but the SEC’s vendetta against him is one of the factors that has led to our screwed-up approach to prosecution of insider trading.

The events in question took place in 1973.  Dirks was a well regarded securities analyst working for a major (since defunct) research firm when a former executive of Equity Funding informed him that the company was one massive fraud.  He conducted his own investigation, determined that the information he’d received was accurate, and reported it to the SEC, which ignored him.  (Can you say “Bernie Madoff”?)  He also told The Wall Street Journal what he had learned and advised his clients to sell their holdings of Equity Funding.  They did just that before the information became public.

Turns out he was right.  Equity Funding collapsed, and some of its executives were prosecuted, convicted, and imprisoned.

You’d think that the SEC would have apologized or at least acknowledged that he was right, right?  Wrong!  The SEC censured him for insider trading, among other things, which would have resulted in penalties, including suspension.  Dirks fought back, and in 1983 the US Supreme Court overturned the censure and rejected the SEC’s interpretation of insider trading.  Instead, the Court said that liability for insider trading depends upon whether the source of the information – the tipper – had breached a legal duty to the corporation’s shareholders in passing along the information; that the tipper in this case was motivated by a desire to expose the fraud; and that “there was no derivative breach” by Dirks.

I don’t blame the Court for coming up with this rather convoluted route to Dirks’s exoneration; after all, one of my law school professors used to beat us over the head with the notion that courts will sometimes bend over backwards to fashion a remedy where the strict letter of the law leads to an unjust result.  That seems to me to be a good thing.  Also, I know that I’m in the minority – possibly a very small minority – that believes that the goal of insider trading law should be to create a level playing field rather than to punish breaches of fiduciary duty.  Still, the Dirks case has resulted in decades of confusion over what is – and what is not – insider trading, and I believe that we’d have all been better off if the SEC had not engaged in overzealousness where Dirks was concerned – particularly given the agency’s non-response to the allegations he’d brought to its attention.

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Background

On October 26, 2022, the SEC adopted final clawback rules consistent with the requirements of the Dodd-Frank Act. The new rules direct the national securities exchanges to establish listing standards requiring companies to adopt, disclose, and enforce policies to recoup, or “clawback,” incentive-based compensation erroneously awarded to executive officers.  Based upon recent SEC action, listed companies will have until December 1, 2023 to adopt compliant clawback policies. The following summarizes some key provisions of the final rules and the decisions that companies will have to make as they finalize their policies by the deadline.

Adopting Compliant Policies 

Companies that do not have existing clawback provisions in place must adopt policies that comply with the standards established by the exchanges. Companies that have clawback provisions in place must determine if and how those policies differ from what is required and either modify their existing policies or adopt a new compliant policy on a stand-alone basis. Questions to help integrate or create compliant policies include: 

Continue Reading The SEC’s New Clawback Rules: The Devil’s in the Details (and There Are Lots of Details)
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The SEC recently enacted a new exemption from registration for brokers who provide certain services in M&A transactions. The new exemption, which became effective on March 29, 2023, largely confirms and codifies prior SEC guidance that was provided in a January 31, 2014 No Action Letter and will provide some comfort and certainty to qualifying M&A brokers and their advisors who work in this arena. However, it may require some M&A brokers to register with the SEC despite the fact that they were not previously required to do so.

The new exemption from SEC registration, which is contained in new Section 15(b)(13) of the 1934 Act, incorporates much of the language of the 2014 No Action Letter, but it imposes size limitations that were not contained in the 2014 No Action Letter. The SEC withdrew the 2014 No Action Letter on March 29, 2023.

Section 15(a) of the Securities Exchange Act of 1934 generally requires any person engaged in the business of carrying out securities transactions for other parties to register with the SEC. Such registration can be costly, intrusive, and time consuming, and it probably does not create a high level of additional consumer protection or benefits in the M&A context. This has consistently been an area of concern, however, since unregistered brokers can be subject to severe penalties such as monetary fines and disgorgement of fees that they have received. As a result, most M&A brokers and their advisors have relied on the 2014 No Action Letter to justify not registering with the SEC. This has largely been a successful strategy absent other disqualifying factors, but because no action letters can be reversed or changed, participants were unable to get totally comfortable.

Continue Reading New SEC Exemption from Registration for M&A Brokers: A Positive Step, but Not for All
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Once again, it’s time for my annual departure from the nerdy world of securities law and corporate governance to discuss my favorite 10 books of 2022 – five each of fiction and non-fiction.  For those unfamiliar with what follows, the books are those I read in 2022, not necessarily those that were published last year.  Also, they are reported in the order in which I read them rather than in order of preference.  So here goes….

Fiction

Severance, by Ling Ma

I am not big fan of what used to be called science fiction and is now, more appropriately, called speculative fiction.  However, I read this book early in 2022 on the basis of a recommendation, and I was dazzled.  Written in 2018, it is about a plague very similar to what we experienced in 2020.  Aside from the author’s prescience – which is pretty remarkable in itself – I loved her crisp writing style, the characters she creates, and her wry approach to catastrophe and the odd emotions and behaviors it brings out in people.

Yonder, by Jabari Yasim

While the plot is completely different, this book about slavery reminded me of The Sweetness of Water, which was one of my favorites of 2021. The writing is beautiful and the story is ineffably sad, upsetting, and uplifting.  

A Thread of Grace, by Mary Doria Russell

Ms. Russell is noted for, among other things, The Sparrow, a work of science – I mean, speculative – fiction that was quite good.  This book is a completely different work, about the plight of Jews who fled to Italy after it withdrew from WWII, thinking it would be a safe haven, only to have to deal with Hitler’s invasion and the perils it posed.  I’m pretty much a sucker for books about WWII, but this is a good one.

Joan, by Katherine Chen

Historical fiction is one of my favorite genres, and this was one of my favorite books of 2022.  It has been criticized because the author has a lot of stuff about the heroine – Joan of Arc – that is almost certainly not true, most particularly her masculine qualities, but she writes so well and it is so believable that I couldn’t have cared less.   Besides, it’s fiction!

The Marriage Portrait, by Maggie O’Farrell

Not as good as Ms. Farrell’s earlier work, Hamnet, but that was extraordinary, while this is just very good.  The author has a gift for making the past real in so many ways – the feel of fabrics, the scent of perfume, etc.  Unlike Hamnet, which was so bittersweet, this one is dark and menacing.  But very good indeed.

Non-Fiction

Pandora’s Jar, by Natalie Haynes

If you’re not familiar with Natalie Haynes, you should be – unless you’re allergic to mythology and great fun.  (She’s a classicist who apparently started out as a stand-up comedian and hasn’t lost her touch for humor.)  This book tells the tales of several ancient female characters with a feminist touch that is fascinating and funny.  I highly recommend the audiobook, narrated by the author.

The Pope at War, by David Kertzer

Mr. Kertzer, a professor at Brown, has written quite a few books about the Vatican and its occupants, most of them quite critical. This one is about the actions (and inactions) of Pope Pius XII during WWII, and turns out to be a rather scathing indictment of how the church reacted to the Nazis.  

Berlin Diary, by William L. Shirer

Shirer — the author of the magnum opus The Rise and Fall of the Third Reich — was a reporter for CBS in Berlin during the rise of the Nazis.  The diary is just that – bits and pieces of various lengths from the diary he kept.  It is gripping and profoundly upsetting, both as history and as a cautionary tale for our era.  I read this one a long time ago but decided to re-read it last year; if anything, it was more powerful this time around.

The Escape Artist, by Jonathan Freedland

As noted above, I’m a sucker for almost anything about WWII.  Consequently, I thought I knew a great deal about Auschwitz and other concentration camps.  I was wrong.  This book is about the first of a very small number of Jews who escaped from Auschwitz and how he tried to alert the world about what was happening there.  The book is profoundly upsetting – for example, the descriptions of daily life at the camp are more detailed and horrific than much of what I’ve read on the topic – and frustrating, as his pleas to address the extermination of Jews and others fall on deaf or uninterested ears.  But it’s very well written and needs to be read.

The Six Wives of Henry VIII, by Alison Weir

I went to London in July 2022 and was, again, reminded about how fascinating English history is.  While the book is not strictly a biography of Henry VIII, it serves that purpose as it tells the story of his loves, lusts, dalliances, and more, and conveys a great sense of what England and the monarchy were in those days.   

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I recently read an article suggesting that companies need to consider appointing a chief resilience officer. That got me thinking about all the other “chief” positions that pundits may be encouraging companies to create.  Here’s a partial list:

Chief Analytics OfficerChief Happiness Officer
Chief Automation OfficerChief Inclusion Officer
Chief Behavioral OfficerChief Information Officer
Chief Budget OfficerChief Information Security Officer
Chief Data OfficerChief Product Officer
Chief Diversity OfficerChief Storytelling Officer
Chief Experience OfficerChief Sustainability Officer
Chief Green Officer Chief Technology Officer
Chief Growth OfficerChief Well-Being Officer

If a few of these titles seem odd, there are others that are legit.  For example, I know of some companies that have a chief information officer, and some that have a chief information security officer – and some that have both.  

At the risk of repeating myself, this is a partial list that I turned up after a very brief search on the web.  And I note that I didn’t perform any diligence to see if any of these positions actually exist, though the articles in which they were cited suggested that was the case.

What concerns me, however, is not whether all of these titles are legit, or even why some people have the time to conjure up the stranger titles, but rather the extent to which having all these titles muddles the lines of responsibility to the point that it’s hard to tell who is responsible for what.  As noted, some companies have both a chief information officer and a chief information security officer.  Who is responsible for preventing cybersecurity incidents? If one occurs, who’s responsible for addressing and/or remediating it?  

It also strikes me that challenges like the one listed above may be made more complicated in the current environment, when people may no longer be working in the same place; how does that play out if the CIO is in Denver and the CISO is in Boston?  Or Japan?

From a broader governance perspective, one would like to think that before a company creates some of the more unusual and/or duplicative chiefdoms above, the board or the comparable authority would have a clear understanding of where each chief’s responsibilities begin and end, and how the responsibilities of each relate to other chiefs’ areas.  However, my experience suggests that may not be the case, which means that accountability is difficult to determine both internally and externally.  Perhaps this isn’t a problem when things are going well, but when they’re not?

There are many other areas of concern to a nerd like me.  For example, which chiefs are deemed to be “executive officers” under SEC rules?  Are they also deemed Section 16 officers?  What’s the rationale for each?  (As an aside, it’s hard enough to explain to clients why someone who is an “executive officer”  may not be a “Section 16 officer,” or vice versa.  This plethora of chiefdoms doesn’t help.)  There seem to me to be compensation issues as well – are all chiefs created equal?  The answer must be “no,” because the traditional chiefs – the CEO, CFO, etc. – do not have identical compensation.  But how do you weigh compensation levels when presumably each chief oversees a significant area?

Finally, the cynic in me wonders why all these chief titles are necessary in the first place.  Perhaps it arises from the same concern for gratification and rewards that has led to giving every kid on the such-and-such team a trophy, even if his or her performance is poor.  I like having my title, as I have for much of my career. However, as my grandmother might say “everything in moderation.”  Or, as others might say, “keep it simple, stupid.” 

Image by Kevin Phillips from Pixabay

Spoiler alert – despite the title and the creepy photo, this is not about zombies, vampires, or anything else of a spooky nature.  Rather, it’s how we can hopefully make some of the deadwood in our proxy statements meaningful.

I realize that the upcoming proxy season already poses a bunch of challenges; just thinking about the SEC’s over-the-top rules on pay versus performance alone could bring on a couple of migraines.

However, a recent article on SEC comment letters to some major companies reminded me that we also face challenges associated with long-standing, important disclosures that tend to be ignored once they’ve been drafted, no matter how much time has passed.  For example, the SEC comments referred to in the article asked companies to do a better job explaining how their boards oversee risks.  What is the timeframe over which you evaluate risks?  Does the board use outside advisors to help them think about the unthinkable?  How does the risk oversight process align with disclosure controls?  Another area of comment related to board leadership: What exactly is the role of the board chair (or lead independent director)?  Does he or she represent the board in communications with shareholders?  Are there circumstances in which he/she could override the CEO on risk matters?  Are there circumstances in which the board would separate (or combine) the positions of board chair and CEO?  And so on.

As noted, I view these as important disclosures.  Sure, when the rules were changed a dozen or so years ago to require these disclosures, we thought they were pains in the neck (or other parts of our anatomy); we reviewed many companies’ proxy statements to see how they handled the issues; we may have agonized a bit about what to say; and then we more or less forgot about the disclosure, other than the occasional tweak in subsequent years.  You are free to disagree, but I think we owe it to our shareholders, if not to ourselves, to make these disclosures meaningful.

Now that I’ve gotten that off my chest, I want to focus on one particular set of disclosures that consistently disappoint me – specifically, the so-called “director skill set” disclosure called for by Item 401(e) of SEC Regulation S-K.  For those of you who haven’t committed all of Reg S-K to memory, the requirement is as follows:

“[F]or each director or person nominated or chosen to become a director, briefly discuss the specific experience, qualifications, attributes or skills that led to the conclusion that the person should serve as a director” 

Again, when this requirement was first instituted, many of us groaned.  We looked at a bunch of so-called leading companies’ proxy statements and debated pithy topics like whether we should provide this skill set disclosure in narrative, full-sentence form or the radical bullet-point approach.  Really.  And then, whatever we decided to do, we’ve tended to stick with it ever since.

At the time, I made the following two suggestions to my then employer:

  • For at least some directors – say, the board chair and the chairs of the board committees – do a little video clip in which each would explain what she/he contributed to the board. Embed a link to the video in the proxy statement; after all, if a picture is worth a thousand words, a video would be a multiple of that.  This suggestion was greeted with groans – we’d have to draft scripts, fit video shoots into already complex schedules, etc.  And it wouldn’t be cheap. OK, I figured that would be a losing proposition.
  • A less technical approach would be to ask each director to draft a sentence or three that we could then edit and include in the proxy statement, all in the first person. I actually thought this was reasonable, but if the first suggestion elicited groans, this one was met with outright derision.  I believe my (least) favorite response was “What? We can’t ask our board members to do that!”  To this day, it seems to me that when you’re paying someone hundreds of thousands of dollars a year and putting your company in his/her charge, asking him/her to draft a sentence or three wasn’t such a big deal.

And so it went, and so it goes.  I still don’t think either idea is bad, and I still see the same tired, old language in most proxy statements.  In some cases, the language has been supplemented or replaced with graphics that range from harmless to incomprehensible, but no one seems to care (presumably including the SEC, which didn’t raise the subject in that recent spate of comment letters).

That said, I’m really not wedded to either of these approaches or to any particular approach.  What I do think was best expressed by one of my favorite people on the institutional investor side of the discussion, who once told me that companies need to explain why each member of board is better than having an empty seat at the board table.  It seems to me that that is a reasonable goal and one towards which we should all strive.

Boards of directors have a lot – maybe too much – to do.  Subjects long believed to be the province of management are now viewed as being in the board’s wheelhouse, and when a problem arises with respect to any of those subjects, the first question asked by investors, regulators, the media, and others is often “where was the board?”  So it is with a degree of reluctance that I am writing to suggest another subject that I believe boards need to address.

Some background may be in order.  A few weeks ago, I attended a meeting of the American Bar Association International Law Section in Madrid.  (How a US-centric lawyer ended up at that meeting is a tale for another day.)  The trip, the city, and the conference were wonderful; I met some extraordinary people and was beyond grateful that I was able to go.  I also learned a lot, mostly on things like international trade and customs law, cross-border discovery, and other topics that I don’t often encounter in my practice.

Another panel that I thought had little to do with my practice turned out to be the most compelling panel of them all, and it definitely is relevant to my practice and to the observation above about the ever-growing responsibilities of the board.  The title of the panel was “Recognizing Human Trafficking as a Common Occurrence During Conflict, and Building Protection and Anti-Trafficking Strategies into Global Responses”.  I suppose the title of the panel could have been more succinct, but – as the moderator of the panel suggested – a more helpful change might have been to give a trigger warning before the panel got underway. Continue Reading Yet another thing for boards to consider

Since the 1980s, Section 102(b)(7) of the Delaware General Corporation Law (the “DGCL”) has enabled Delaware corporations to provide exculpation from breaches of the fiduciary duty of care to directors – but not officers – in certain circumstances.  Officers can now come in from the cold, as Section 102(b)(7) has now been amended to provide similar protection for certain officers.  Specifically, the amendments, which became effective on August 1, 2022, allow Delaware corporations to provide exculpation from breaches of the duty of care to specified officers in certain circumstances. The new provisions allow a qualifying officer to be exculpated from such claims made directly by stockholders but do not provide relief in connection with other fiduciary duties, derivative actions, or actions brought by a corporation’s board against its officers.

We view this amendment as a major forward step.  If your company (or any subsidiary) is a Delaware corporation, you should seriously consider amending its certificate of incorporation to provide this protection.  And if you are an officer of a Delaware corporation, you should make sure your board of directors is aware that this protection is available and urge your board to take the steps needed to provide the protection..

Continue Reading Coming in from the cold: Delaware provides exculpation protection to corporate officers