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NYDFS Announces Final Cybersecurity Rules for Financial Services Sector

From our colleagues Carla Small, Jim Halpert and Anne Kierig

Governor Andrew Cuomo has announced final cybersecurity rules for New York’s financial services sector.

The Cybersecurity Requirements for Financial Services Companies (the Final Rule), promulgated by the New York Department of Financial Services, is the most specific cybersecurity regulation in the country to apply to companies that are not critical infrastructure operators.…

New SEC exemption rules for intrastate and regional offerings

Yesterday the SEC adopted rules intended to facilitate intrastate and regional securities offerings.  The SEC made general updates and modernized old Rule 147, the safe harbor exemption for intrastate securities offerings under Section 3(a)(11) of the Securities Act. The SEC also adopted a new exemption in Rule 147A, which differs from Rule 147 primarily in that it expressly permits general solicitation and does not require the issuer to be formed in the same state as its principal place of business and investors. …

Understanding the differences between an ISO vs. NSO

By Tyler Hollenbeck and Cisco Palao-Ricketts

Although there a number of web resources regarding the distinctions between “incentive stock options” (ISOs), which can only be granted to employees, and “non-statutory options” (NSOs)[1], which can be granted to employees, directors and consultants, these resources are often heavy with tax jargon that is difficult to understand. …

A Founder’s Guide to Making a Section 83(b) Election

One of the more important tax decisions founders of early-stage companies will face is whether or not to make an election under Section 83(b) of the Internal Revenue Code for stock awards or other acquisitions of shares subject to vesting. By making this decision promptly upon acquiring the shares, founders can avoid missing the 83(b) filing deadline and protect themselves from significant tax consequences down the line.…

Choosing a Corporate Name: Practical Considerations and Legal Requirements

Deciding on the name for your to-be-formed company can be a stressful process given the seemingly endless number of possibilities and the limited legal requirements. Whether you have brainstormed a robust list of potential names and are having difficulty taking the final plunge, or are just now starting your search for the perfect name, we believe the practical considerations and legal overview below may be helpful to both new and experienced entrepreneurs alike when it comes to navigating the name selection process.…

Employee and Other Proprietary Information & Invention Assignment Agreements – Update for New Trade Secret Law

On May 11, President Barack Obama today signed the Defend Trade Secrets Act (DTSA) into law.  The law is effective immediately.  The DTSA provides a federal claim for misappropriation of trade secrets. Until now, trade secrets have been protected only at the state level, with most states (other than New York and Massachusetts) adopting their own version of the Uniform Trade Secrets Act (UTSA).…

Angel Investment Trends: FY 2015 Halo Report

The 2015 Annual Halo Report has been released by The Angel Resource Institute at Willamette University (ARI) and PitchBook.  The Halo Report analyzes angel group investment activity and trends in the United States.  Here are a couple interesting FY 2015 highlights:

  • The median seed-stage valuation for 2015 deals hit an all-time high of $4.6M (up from 53% from 2014);
  • The median and mean round sizes in deals with only angel investors climbed to $850K and $1.164M, respectively (both up materially from 2014);
  • The median and mean round sizes in deals when angels co-invest with non-angels also climbed to $1.6M and $2.0M, respectively (however, this was only a modest increase from 2014);
  • The Halo Reports provides a list of the most active angel groups by deal count in 2015;
  • California continues to be the leading region in terms of the most angel capital invested and highest angel deal count, but the New England-area basically doubled its share of both deals and dollars nationally in 2015; and
  • The top three industry sectors attracting angel investment continue to be software, healthcare and commercial services (in terms of both total dollars invested and total deal count).

Franchise tax due by March 1 for Delaware corporations: two methods of calculation, two vastly different results

Just a reminder to those who have Delaware corporations, your annual report and franchise tax payment are both due by March 1. At this point, you have likely already received from Delaware your notification of annual report and franchise tax due, which is sent to a corporation’s registered agent in December or January of each year.…

Angel Investment Trends: Q3 2015 Halo Report

The Q3 2015 Halo Report has been released by The Angel Resource Institute at Willamette University (ARI) and PitchBook.  The Halo Report analyzes angel group investment activity and trends in the United States.  Here are a couple interesting Q3 2015 highlights:

  • The median seed-stage valuation has hit an all-time high of $4M (up from $3M in 2014);
  • The median round size in deals with only angel investors was $725K and the median round size in deals when angels co-invest with non-angels was $1.71M (both up materially from Q3 2014);
  • The Halo Reports provides a list of the most active angel groups by deal count in 2015;
  • California continues to be the leading region in terms of the most angel capital invested and highest angel deal count (with totals thru Q3 2015 at 19.7% and 21.1%, respectively, of the U.S.

SEC Proposes Clawback Rules

The SEC has proposed rules requiring listed issuers to adopt and comply with written “clawback” policies. These policies would need to provide that, if a listed issuer is required to prepare an accounting restatement due to the material noncompliance of the issuer with any financial reporting requirement under the securities laws, then the issuer will recover the amount of any incentive-based compensation erroneously awarded to an executive officer.…

Carefully Draft NDAs to Avoid Whistleblower Concerns

In light of the SEC’s first enforcement action against a company for impeding whistleblower activity in violation of Rule 21F-17, employers may wish to consider clarifying in their agreements, policies and practices that involve confidentiality obligations that employees may provide truthful information to the SEC or other governmental agencies concerning potential violations of law.…

IMHO, Omnicare Doesn’t Materially Change Opinion Disclosure

Today, the U.S. Supreme Court issued its anticipated Omnicare decision, which addresses the standard of liability applied to expressions of opinion in a registration statement for a public offering. While there will be clamoring about Omnicare (it is somewhat rare for the Supreme Court to issue securities law decisions), in my opinion the case does not involve a fundamental shift in how disclosure is drafted, although it does invite a few drafting and diligence strategies.…

Interactive 2015 Data Protection Laws of the World Handbook

Compliments of our DLA Piper colleagues in the data protection and privacy practice, and co-editors Kate Lucente and John Townsend, here is the DLA Piper 2015 Data Protection Laws of the World Handbook. This updated 2015 online edition of the handbook offers a high-level snapshot of selected features of international laws as they currently stand in 77 jurisdictions across the world.…

Three Trends in 2014 Venture Capital Funding

Contributed by our colleague Mark Radcliffe

2014 was a great year for startups seeking funding.  Two of the leading reporting companies, PitchBook and CB Insights, report similar trends (both of these reports focus on funding by traditional financial venture capitalists and corporate venture capitalists, but the numbers differ because PitchBook also includes some angel investments).…

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