SEC Approves NASDAQ "Golden Leash" Rules

Overview

Recently, the U.S. Securities and Exchange Commission (the "SEC") approved NASDAQ's new Rule 5250(b)(3), which requires NASDAQ-listed companies to publicly disclose any cash or non-cash payments made by third parties to any directors or director nominees in connection with their candidacy for, and/or their service on, a company's board of directors. Foreign private issuers will be required to comply with the new rules. The SEC approved concurrent amendments to NASDAQ Rule 5615 to provide that foreign private issuers subject to disclosure requirements regarding these types of compensation arrangements in their home countries will be permitted to follow those rules in lieu of the NASDAQ rules, with appropriate Form 6-K disclosure.