PRESENTATIONS
|
| Introduction to Legal Issues |
Presentation by Curtis R. Hearn, Partner, Jones, Walker
Recent corporate scandals have given way to increased scrutiny of public registrants and their boards by legislators and regulators. In addition, shareholder groups, such as Institutional Shareholder Services, are taking a harder look at entities and creating new metrics by which to measure and compare corporate governance. This presentation provides an overview of the current regulatory structure impacting corporations and what is expected by shareholders of boards and the principal officers of the entities in which they invest.
|
| Auditor Independence |
Presentation by Kenneth J. Najder, Partner, Jones, Walker
The auditor independence provisions of Title II of the Sarbanes-Oxley Act followed decades of increasing scrutiny on the importance of independent auditors and audit committees as a defense against financial fraud. Finally, perceived failures of the auditors and audit committees of Enron and other companies led to the Act and an independent review by the NYSE and NASD of their corporate governance standards. This presentation examines the provisions under Title II of the Act, including limits on non-audit services, pre-approval requirements, audit partner rotation, and auditor reports to the audit committee.
|
| Whistleblower Protections |
Discussion between Carl C. Hanemann and Lisa M. Buchanan, Partners, Jones, Walker
Whistleblower protections are contained in three widely-separated provisions of the Sarbanes-Oxley Act. Section 501 adds a new section to the Securities Exchange Act of 1934 that prohibits retaliation by broker-dealers and individuals involved in investment banking against securities analysts for unfavorable research reports. Section 1107 amends the U.S. Criminal Code to add criminal penalties for knowing or intentional retaliation against any person for providing to a law enforcement officer any truthful information relating to the commission or possible commission of any federal offense. Finally, Section 806 sets out the specific whistleblowing protection with respect to Sarbanes-Oxley violations. This presentation, in a role-playing case study, explores the operations of these provisions.
|
| SEC Standards of Professional Conduct for Attorneys |
Discussion between Carl C. Hanemann and Lisa M. Buchanan, Partners, Jones, Walker
The SEC adopted a final rule on Standards of Professional Conduct for Attorneys, implementing Section 307 of the Sarbanes-Oxley Act, and imposing new ethical obligations on attorneys who appear and practice before the Commission. The rule is important not only for U.S.-based securities lawyers but also for non-securities lawyers and non-U.S. lawyers who do work for companies that file reports with the SEC. The rule also has significant consequences for reporting companies and their management because it affects in serious ways their relationships with some of their most important advisors. This presentation, in a role-playing case study, explores the operation of the final rule.
|
| SRO Rulemaking |
Presentation by Douglas N. Currault, II, Partner, Jones, Walker
This presentation discusses the corporate governance reforms that the New York Stock Exchange, NASDAQ and the American Stock Exchange have proposed for listed companies, particularly in relation to audit committees, boards of directors, and codes of ethics. The discussion also includes best practices that many companies have considered to voluntarily adopt.
|
| Director and Officer Indemnification from Liability |
Presentation by Richard P. Wolfe, Partner, Jones, Walker
The term indemnification refers to reimbursement by a corporation to its directors, officers, and employees for expenses, including legal fees and, in some cases, judgments and settlements incurred and paid by them in defending lawsuits arising by reason of their being directors, officers, or employees of the corporation. This presentation explores the types of lawsuits as to which indemnification may be relevant, as well as the various categories of indemnification that may apply. In addition, there is some discussion of the advancement of legal fees as a solution to a practical problem of the indemnification process.
|
| Director & Officer Exculpation from Liability |
Presentation by Richard P. Wolfe, Partner, Jones, Walker
Unlike indemnification statutes, exculpation clauses in corporate charters protect directors not only against legal fees incurred in defending lawsuits brought against them as directors but, more importantly, against liability for certain types of actual breaches of their fiduciary duty to the corporation. This presentation explains the operation—and limitations—of exculpation clauses, in light of the corporate director’s principal duties of care and loyalty.
|
|
 |
|
| CEO/CFO Certifications and Improper Influence Over Auditors |
Presentation by L. Richards McMillan, Partner, Jones, Walker
Under Sections 302 and 906 of the Sarbanes-Oxley Act, each periodic report containing financial statements filed by a public company must be accompanied by a written certification from the CEO and the CFO that, among other representations, they have reviewed the report, and the report fairly presents, in all material respects, the financial condition and results of operations of the company. Knowing or willful failure to comply with the new certification requirements may subject the CEO and the CFO to a substantial fine and imprisonment. Section 303 of the Sarbanes-Oxley Act makes it unlawful for any officer or director, or individuals acting under their direction, from taking any action to mislead or fraudulently influence the auditor of the company’s financial statements. This presentation examines these important areas of corporate governance and responsibility, including analysis of final rules issued by the Securities and Exchange Commission. In addition, practical issues are addressed and guidance offered in dealing with the challenges of these comprehensive provisions.
|
| Penalties for Officer and Director Misconduct |
Discussion between L. Richards McMillan and Margaret F. Murphy, Partners, Jones, Walker
Section 304 of the Sarbanes-Oxley Act is one of several provisions in the Act that was designed to prevent chief executive officers and chief financial officers from receiving bonuses or profiting on sales of company stock, while misleading interested parties about the company’s financial condition. This presentation focuses on the compensation and profit forfeitures that are required by the Act, as well as other penalty provisions, and identifies unanswered questions and offers recommendations for companies in handling issues prospectively.
|
| Insider Transactions |
Discussion between L. Richards McMillan and Margaret F. Murphy, Partners, Jones, Walker
Section 403 of the Sarbanes-Oxley Act amends Section 16(a) of the Securities Exchange Act of 1934 to require officers, directors, and 10-percent beneficial owners of public companies to report transactions in the securities of the company much sooner than in the past. In effect, legislators sought to make information on insider transactions more readily available to investors to encourage smarter investment decisions. This presentation takes a look at some of the issues of compliance with the new requirements and offers various pre-clearance procedures for smoothing the transition.
|
| Prohibition on Insider Loans |
Discussion between L. Richards McMillan and Margaret F. Murphy, Partners, Jones, Walker
Section 402 of the Sarbanes-Oxley Act generally prohibits public companies from extending a loan to any director or executive officer that is not made in the ordinary course of the issuer’s business, and is not generally made available to the public on market terms. Although there has been no guidance from the Securities and Exchange Commission in this area, this presentation examines many of the insider loan issues that have arisen, and offers some insights into the types of arrangements that may be subject to the reach of the statute, as well as some exceptions.<
br>
|
| Retirement Plan Blackout Periods |
Discussion between L. Richards McMillan and Margaret F. Murphy, Partners, Jones, Walker
Section 306(a) of the Sarbanes-Oxley Act prohibits any director or executive officer of a public company from engaging in transactions of equity securities of the company during any retirement plan blackout period. The SEC issued final rules, known as Regulation Blackout Trading Restriction (Regulation BTR) to address the operation of Section 306(a). This presentation examines the requirements and exceptions of Regulation BTR and provides guidance for companies to comply with those rules.
|
| Director & Officer Insurance |
Discussion between Richard P. Wolfe and L. Richards McMillan, Partners, Jones, Walker
The director and officer insurance market is currently in a state of tremendous flux. Policy clauses that insurers were willing to agree to a year or two ago may no longer be available. More particularly, D&O insurers have recently attempted to eliminate the severability clause that protects innocent directors from losing coverage because of faithless co-insureds. In addition, rates for some D&O policies have increased as much as 500 percent in the last year. This presentation alerts directors and officers to some of the more sensitive and important problem areas presented by D&O policies, which can significantly affect the protection offered to a director of a public company by such a policy.
|
|
