Effective September 27, 2010, a new rule adopted by the Financial Industry Regulatory Authority (“FINRA”) requires timely notice to FINRA of certain corporate actions. FINRA Rule 6490 (Processing of Company-Related Actions) codifies the requirements of Securities Exchange Act Rule 10b-17 (Untimely Announcements of Record Dates). Issuers of publicly-traded, non-exchange-listed securities must file forms with FINRA and pay applicable fees within required time periods or be subject to late fees of up to $5,000. Late notifications may result in delayed processing of documents to announce corporate actions. The text of FINRA Rule 6490, a detailed discussion in Regulatory Notice 10-38 and related UPC forms and documentation are available on the FINRA website at http://www.finra.org/.
FINRA Rule 6490 requires that notice must be given in advance to FINRA concerning specified corporate actions including dividends or distributions in cash or in securities, stock splits, reverse stock splits, rights offerings, company name changes, trading symbol changes, mergers, acquisitions, dissolution or other company control transactions, bankruptcy or liquidation.
If you have questions, please contact Howard O. Hagen at 515-246-4543 or hhagen@dickinsonlaw.com.
