Designated Lender’s Counsel

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Doug Cornelius at Compliance Building writes today about borrowers paying the legal fees of lender’s counsel: Of course there is a conflict with the law firm. That too is a conflict that has been in place for decades. The bank’s lawyers know they represent the bank. They also know the borrower is paying their bill. Until

What, If Anything, Is Wrong With The Contractual Obligations Table?

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Many readers will recognize the table above as being required by Item 303(a)(5) of Regulation S-K.  The Securities and Exchange Commission added this disclosure requirement in 2003, explaining in the adopting release: Aggregated information about a registrant’s contractual obligations in a single location will provide useful context for investors to assess a registrant’s short- and

Are California Statutes Authorizing Desist And Refrain Orders Facially Unconstitutional?

In December 2008, the Commissioner of Corporations issued a desist and refrain order based on alleged violations of the Corporate Securities Law and the Finance Lenders’ Law.  Nearly seven years later, the respondents challenged the order by filing a complaint in the U.S. District Court.  The complaint included four causes of action: (1) violation of

Court Holds Extrinsic Evidence Was Inadmissible

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As generally understood, the parol evidence rule prohibits the introduction of extrinsic evidence to alter, vary or add to the terms of an integrated agreement.  “Parol” is derived from the French word, “parole” meaning speech.  The parol evidence rule came into being as society became increasingly literate.  It was then that the written word began

With Periphrasis, “Success in Circuit Lies”

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I initially titled Tuesday’s post “The Staff’s Position On Unbundling Gets Even Weirder” but I ultimately elected to substitute “More Weird” for “Weirder”.  What I was struggling with was whether to use the comparative or periphrastic form of the adjective “weird”. The comparative form uses inflection, that is the modification of a word to express

The SEC Staff’s Position On Unbundling Gets Even More Weird

“Bundling” was a colonial American practice of unmarried persons sharing the same bed whilst being physically separated by a board or sack.  As might be expected, bundling had its critics.  One Henry Reed Stiles piously carped: Bundling – that ridiculous and pernicious custom which prevailed among the young to a degree which we can scarcely credit –

ISS Ignores Contrary Studies In Adopting Overboarding Policy Change

ISS released its 2016 Benchmark Policy Recommendations last Friday.  I had previously criticized ISS for its proposal to change its recommendation on withholding votes with respect to directors who sit on too many boards: In proposing this policy change, ISS cites surveys that reflect an increase in the time commitment required for board service. ISS

Enjoining The Correct Spelling

In yesterday’s post, I wrote that Judge Leigh Martin May had issued a ruling enjoining a SEC administrative proceeding.  Presumably, Judge May has or will issue an injunction.  This leads me to question why the verb is typically spelt “enjoin” while the noun is spelt “injunction”.  Both words share the same roots – they are formed by

Why The Capitol Is In The Capital

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Article III, Section 2 of the California Constitution provides that “Sacramento is the capital of California”.  The building in which the legislators meet, however, is denominated the “capitol” building.  Thus, the state capitol can be found in the state capital.  But why the variant spelling? Both words are derived from the Latin word for head