New York Clauses Relating to Transactions with Insiders refer to specific provisions within the laws and regulations of the state of New York that address transactions between a company and its insiders or related parties. These clauses are designed to regulate and govern these transactions, ensuring fairness, transparency, and preventing any potential conflicts of interest. In New York, there are several types of clauses relating to transactions with insiders, including: 1. The Interested-Director Transaction Clause: Under this clause, directors or officers of a company with a conflicting interest in a transaction must disclose their interest and abstain from voting on the matter. This provision aims to ensure that decisions are made in the best interests of the company and not influenced by personal gain. 2. The Fairness Opinion Clause: This clause requires companies engaging in insider transactions to obtain an independent fairness opinion from a qualified financial professional. The fairness opinion assesses and confirms that the transaction terms are fair to the company and its non-insider shareholders. 3. The Entire-Board Provision: This provision requires that the entire board of directors or a majority thereof approve any transaction with an insider. This ensures that decisions are made collectively and not solely influenced by a select few directors, minimizing the risk of self-dealing or unfair practices. 4. Minority Shareholder Protections: New York law also provides protections for minority shareholders in transactions with insiders. These clauses might include appraisal rights, allowing minority shareholders to demand a fair price for their shares if they do not agree with an insider transaction. 5. Enhanced Disclosure Requirements: New York regulations often require enhanced disclosure of insider transactions in public company filings. This ensures that shareholders and the public are adequately informed about the nature, terms, and potential conflicts of interest surrounding these transactions. These New York Clauses Relating to Transactions with Insiders play a vital role in safeguarding the interests of shareholders and maintaining the integrity of corporate governance. By imposing transparency, requiring independent assessments, and ensuring collective decision-making, these clauses aim to prevent abuse of power and protect the rights of all stakeholders involved.
New York Clauses Relating to Transactions with Insiders
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Knowingly lend, directly or indirectly, any money or property for the purpose of enabling any person to pay for or hold shares of its stock, unless the loan is made upon security having an ascertained market value of at least fifteen per centum more than the amount of the loan.
Regulation O was implemented to prevent certain bank insiders from receiving more favorable terms or benefits on loans or credit than those provided to non-insiders or other bank customers.
The application of Part 11 "Insider Transactions" regulation to agreement between the Bank and an entity partly owned by one of the Bank's directors. Part 11 requires that each mortgage purchase transaction be specifically reviewed by the Bank's board of directors.
