The Business Counselor Blog™

New Supply Chain Management Disclosure Requirements

This issue of Business Counselor Update includes new forms and commentary that will be incorporated into the Westlaw database Business Transactions Solutions (BTS) in December.  Access to further information requires a Westlaw subscription, which can be obtained by using the contact and ordering information included in the materials.  This issue highlights new supply chain management disclosure requirements adopted in California and include information on launching relationships with new vendors.  Protection of personal information is addressed by a social security number policy and counsel representing employers can take advantage of a template for disclosure of certain basic employment-related information to new employees.  Finally, the issue provides advice on creating a library of the forms needed to quickly and efficiently assist clients in forming and organizing a new corporation.

New Dodd-Frank Whistleblower Requirements Approved by SEC

A public company’s “whistleblower” policies and procedures must take into account the potential impact of Section 21F of the Securities Exchange Act of 1934 entitled “Securities Whistleblower Incentives and Protection.”, which was adopted as part of the Dodd-Frank Wall Street Reform and Consumer Protection Act (“Dodd-Frank”).  Among other things, Dodd-Frank established a whistleblower program that requires the Securities and Exchange Commission (“SEC”) to pay an award, under regulations prescribed by the SEC and subject to certain limitations, to eligible whistleblowers who voluntarily provide the SEC with “original information” derived from the independent knowledge or analysis of the whistleblower about a violation of the federal securities laws that leads to the successful enforcement of a covered judicial or administrative action, or a related action.  Dodd-Frank provides for bounties of 10% to 30% of the monetary sanctions exceeding $1 million resulting from an SEC enforcement action, or several enforcement actions rising out of the same set of facts. Dodd-Frank also prohibits retaliation by employers against individuals who provide the SEC with information about possible securities violations.   On May 25, 2011, the SEC voted to approve the Final Rules implementing the whistleblower provisions of Dodd-Frank and this report summarizes some of the key issues that public companies must now take into account in designing their internal procedures relating to employee reporting.

Preincorporation Agreements

Preincorporation agreements can be invaluable tools in focusing the principals of a new business on the hard decision that need to be made about governance of the new business and the roles that all of the key personnel will be playing in the operation and success of the venture.  These types of agreements include various contracts entered into by incorporators, promoters, subscribers and the principals (e.g., executive officers and directors) regarding the future organization of a corporation.  The agreements establish the ground rules for the organization, capitalization, and management of the proposed corporation.  This report provides an overview of the issues that should be considered by counsel and clients and also includes a sample of an agreement to incorporate as a Subschapter S ("pass-through taxation") corporation.  Westlaw subscribers interested in further information should review the materials in Chapter 5 of Business Transactions Solutions authored by Alan Gutterman.

Board Meetings and Actions: A Practical Primer

This report is intended as a practical primer on one very important aspect of counseling the board of directors--making sure that board meetings and other actions of the directors in the official capacity are conducted efficiently and in line with applicable legal requirements.

New SEC Rules on Shareholder Compensation Votes & Progress on US Patent Law Reforms

This month’s Business Counselor Update highlights the adoption of final rules by the Securities and Exchange Commission implementing required shareholder votes on executive compensation and golden parachute compensation and the latest developments in the ongoing efforts to reform the US patent laws.

Antitrust Compliance Checklist

It is essential for companies of all sizes to develop some sort of formal program and procedures relating to antitrust law compliance.  the two principal objectives of an antitrust compliance program should be "prevention" and "detection' and one good tool tool for educating clients is an antitrust compliance checklist. 

Director Education & Assessment

Accepted notions of good corporate governance dictate the implementation of director education programs and regular assessments of the performance of the board of directors.  This report provides an introduction to both of these topics.

Law & Compliance Practice Manual to be Released Soon

In just a few short weeks my new publication, the Business Counselor's Law & Compliance Manual, will be launched.  Attached is a copy of the Foreword to give you a preview of the contents.  I hope you will find the publication to be useful and welcome your suggestions for new topics.

Related Party Transaction Policy & Procedures

This post includes an example of a related party transaction policy and procedures for review of potential conflicts of interest involving directors, officers, major shareholders and parties related to them.  While this type of policy is obligatory for public companies it is also recommended for any firm that may engage in transactions that might create actual or potential conflicts of interest between the corporation and any of its key stakeholders.

Model Regulation FD Policy

The SEC adopted Regulation FD back in 2000 to address concerns about selective disclosure of material nonpublic information relating to companies subject to the Securities Exchange Act of 1934.  In response public companies adopted policies and procedures designed to assist with Regulation FD compliance.  In this post I provide a model Regulation FD policy that includes various elements that may be of value to any company administering a communications policy with a group of external stakeholders (including investors).