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Full-Text Articles in Law
Leverage In The Board Room: The Unsung Influence Of Private Lenders In Corporate Governance, Frederick Tung
Leverage In The Board Room: The Unsung Influence Of Private Lenders In Corporate Governance, Frederick Tung
Faculty Scholarship
The influence of banks and other private lenders pervades public companies. From the first day of a lending arrangement, loan covenants and built-in contingency provisions affect managerial decision making. Conventional corporate governance analysis has been slow to notice or account for this lender influence. Corporate governance discourse has traditionally focused only on corporate law arrangements. The few existing accounts of creditors' influence over firm managers emphasize the drastic actions creditors take in extreme cases - when a firm is in serious trouble - but in fact, private lender influence is a routine feature of corporate governance even absent financial distress. …
Civil Liability And Mandatory Disclosure, Merritt B. Fox
Civil Liability And Mandatory Disclosure, Merritt B. Fox
Faculty Scholarship
This Article explores the efficient design of civil liability for mandatory securities disclosure violations by established issuers. An issuer not publicly offering securities at the time of a violation should have no liability. Its annual filings should be signed by an external certifier – an investment bank or other well-capitalized entity with financial expertise. If the filing contains a material misstatement and the certifier fails to do due diligence, the certifier should face measured liability. Officers and directors should face similar liability, capped relative to their compensation but with no indemnification or insurance allowed. Damages should be payable to the …