WORD OF THE DAY® for Hedge Funds – Accelerated Share Repurchase
On April 12, 2024, the Treasury Department (Treasury) and Internal Revenue Service (IRS) issued proposed regulations (89 FR 25980 and 89 FR 25829) on the excise tax on stock buybacks enacted as part of the Inflation Reduction...more
The U.S. Department of the Treasury and IRS intend to issue proposed regulations addressing application of a new excise tax on repurchases of corporate stock under Section 4501 of the Internal Revenue Code (Code). Section...more
The corporate alternative minimum tax (CAMT) and the excise tax on stock repurchases, each enacted as part of the Inflation Reduction Act of 2022, will soon become effective — for the CAMT, for taxable years beginning after...more
Beginning in 2023, an excise tax of 1% will apply to public company stock buybacks and a 15% corporate minimum tax generally will apply to corporations with book income exceeding $1 billion. Key Points: ..Public...more
On August 12, 2022, the U.S. House of Representatives approved H.R. 5376, the “Inflation Reduction Act” (the Act), which was signed into law by President Biden on August 16, 2022. The approval and subsequent enactment follow...more
The Inflation Reduction Act of 2022 includes an excise tax that, if enacted, will make share repurchases by publicly traded companies more costly starting in 2023. The proposed tax is meant to be a significant revenue-raiser,...more
In legislative text released October 28, 2021, the House Rules Committee proposed to impose a 1% excise tax on stock repurchases by publicly traded companies starting in 2022. If the provision is enacted, corporations will...more
Last month, the SEC announced that a public company had agreed to pay a $20 million penalty to resolve charges related to its repurchase of stock while supposedly in possession of material, non-public information (“MNPI”)...more
The question is no longer whether the volatility created by the COVID-19 pandemic will deepen the difficulties businesses and other institutions face in the coming months, but by how much and in what ways. In the past few...more
The Small Bank Holding Company ("BHC") Policy Statement ("Policy Statement") was adopted by the Federal Reserve in 1980 to facilitate transfers of small banking organizations, including BHCs formed to assume individuals' bank...more
Delaware law provides important tools for directors to maintain control of derivative lawsuits.1 One such tool is the “demand requirement” embodied in Court of Chancery Rule 23.1, which requires that before a stockholder acts...more
On May 2, 2017, Vice Chancellor Laster of the Delaware Court of Chancery dismissed a purportedly derivative and putative class action brought by a minority stockholder of software company VMware, Inc. (“VMware”), a subsidiary...more