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On Thursday April 16, Sheppard Mullin submitted comments to the Federal Reserve about its terms sheets for the $600 Billion Main Street Loan Program. These comments raise and explore numerous important questions that the Fed and Treasury will necessarily need to grapple with to make the Main Street programs successful. We believe that these comments together with our comparative chart of the two Main Street loans being offered will help readers gain an initial understanding of how the Main Street Loan Program may work with companies’ existing debt and operations. We will provide updates when new information is released about the Main Street program.
Continue Reading Sheppard Submits Comments to Main Street Loan Program

5-1-2020 Update: We plan to provide an update later today to reflect the Fed’s April 30, 2020 release of the new terms sheets and FAQs.

On April 9, 2020, the Federal Reserve took additional actions to provide up to $2.3 trillion in loans to support the economy.  This blog focuses on the Main Street Lending Program, which is a $600 billion loan program, that will include $75 billion capitalized by the Treasury Department under the $454 billion Congressional appropriation of Section 4003(b)(4) of Title IV of the CARES Act.   The loans will target mid-sized companies, defined as having less than 10,000 employees or $2.5 billion in 2019 annual revenue, and will be made by banks and other eligible lenders, with the government then purchasing  95% of the lenders’ interest in the loans.Continue Reading Main Street Lending Program Summary

With annual reports on Form 10-K publicly filed and first quarter earnings releases getting underway, proxy season – the annual practice of filing and distributing proxy statements, reserving meeting venues and courting shareholders – is now in full effect.
Continue Reading Virtual and Hybrid Shareholder Meetings in the Era of COVID-19: What Public Companies Need to Know

The coronavirus (COVID-19) outbreak has impacted publicly traded companies that provide information to trading markets, shareholders and to the Securities and Exchange Commission (SEC). Companies need to be mindful with respect to disclosures in annual and quarterly reports, earnings releases, current reports, and public and private securities offering documents.
Continue Reading Coronavirus and Guidance on SEC Disclosures

Major economic stabilization funds are made available to U.S. businesses (including nonprofits), states and municipalities under Title IV of the CARES Act. Title IV itself is titled the “Coronavirus Economic Stabilization Act of 2020” (referred to in this summary as “CESA”).[1]
Continue Reading Funds Available to Businesses Under the Coronavirus Economic Stabilization Act (CARES ACT Title IV)

On March 25, 2020 the Senate passed a $2 trillion stimulus bill “[p]roviding emergency assistance and healthcare response for individuals, families and businesses affected by the 2020 coronavirus pandemic.”  The House and the President are both expected to approve the Bill in short order.  The Bill contains many provisions important to all companies, including government contractors.  Sheppard Mullin’s Government Contracts, Investigations and International Trade Practice Group prepared a summary of the Bill, available here.  In addition, for your reference, we are providing a section-by-section analysis from Capitol Hill, as well as the text of the bill itself.  Do not hesitate to contact us with any questions about the legislation or its implementation.
Continue Reading Key Provisions in the Senate Stimulus Bill

As we all learn to cope with the unprecedented changes to our daily lives imposed by the COVID-19 crisis, we want to assure you that the Sheppard Mullin estate planning team is thinking of you and stands ready to assist you in any way possible.

These uncertain times have caused many of us to think about steps we might take to confirm that our affairs are in order and that we have prudently provided for our family members and other loved ones.  To assist with that review, we provide the following tips:
Continue Reading Estate Planning In Turbulent Times

Boards of directors have a duty to exercise oversight and to monitor the company’s operational viability, legal compliance and financial performance during this COVID-19 pandemic. In Marchand v. Barnhill,[1] the Delaware Supreme Court held that the alleged facts relating to an outbreak of listeria raised a reasonably conceivable inference that the company’s directors failed to adopt a reporting and monitoring system sufficient to ensure they remained informed about food safety issues, which resulted in the company recalling all of its products, shutting down production, and laying off over a third of the workforce.[2]
Continue Reading COVID-19 Directors’ Duties of Oversight: Reporting and Monitoring

The World Health Organization has labelled novel coronavirus (COVID-19) a pandemic and the global number of confirmed cases of COVID-19 has surpassed 150,000.  Companies suffering losses that they believe are attributable to COVID-19 or desiring to seek insurance to potentially cover losses resulting from COVID-19, should discuss these issues with their insurance broker(s) and risk manager(s) to assess the extent of coverage available.  While the exact legal duties owed by insurance brokers to their clients vary from state-to-state, brokers are typically required to use at least reasonable care, diligence and judgment in procuring the insurance coverage requested by an insured.
Continue Reading Insurance Considerations for Companies Impacted by Coronavirus