TheCorporateCounsel.net

January 7, 2010

Survey Results: D&O Questionnaires and Related-Party Transactions

Below are the results from a recent survey we conducted on the topic of your company’s plans for this year’s D&O questionnaire in the area of related-party transactions:

1. Regarding the level of related-party information that we request from directors and officers:
– We ask each D&O to inform us of any related-party transaction – 55.7%
– We ask each D&O to inform us of only those related-party transactions over $120,000 – 40.2%
– We ask each D&O to inform us of only those related-party transactions over $50,000 – 1.0%
– We ask each D&O to inform us of only those related-party transactions over $25,000 – 0.0%
– Other – 3.1%

2. Regarding the level of related-party information that we request from directors and officers:
– We ask each D&O to submit an annual list of their entire immediate family – 9.3%
– We ask each D&O to submit an annual list of their entire immediate family, including place of employment and any entities in which they own more than a specified amount – 21.7%
– We define “immediate family members” and provide a list of the company’s subsidiaries and then ask each D&O to list any immediate family members doing business with these entities – 53.6%
– Other – 15.5%

3. Regarding how “complete” we require the list of immediate family members:
– We require each D&O to provide a complete list of each individual that falls under the definition of “immediate family members,” regardless if there has ever been any contact with them (e.g., in-law living in another country) – 29.2%
– We request that each D&O provide a list of immediate family members they are in contact with and require an affidavit that there is no contact with other known “immediate family members” (egs. estranged child or hostile father-in-law) – 2.1%
– We do not require each D&O to provide a list of immediate family members; instead, we rely on the directors to self-report related-party transactions – 65.6%
– Other – 3.1%

4. Regarding the method(s) of due diligence review that we perform for related-party transactions:
– We rely solely on each D&O to alert us to any potential transactions – 32.0%
– We conduct a periodic review of SEC filings, Web search engines, and relevant web sites to update the lists of immediate family members provided by our D&Os – 0.0%
– We conduct a periodic review of our accounts payable and receivable for transactions with individuals on the list of immediate family members provided by our D&Os – 25.8%
– We distribute the lists of immediate family members to our business unit heads and require them to monitor for related party transactions – 2.1%
– All – or some combination – of the above – 27.8%
– Other – 12.4%

Please take a moment to respond anonymously to our “Quick Survey on Impact of Loss of Broker Nonvotes for ’10 Proxy Season.”

Profile: SEC Chair Schapiro’s First Year

Here is a Bloomberg article that profiles SEC Chair Schapiro’s first year in office.

Mailed: November-December Issue of The Corporate Counsel

The November-December issue of The Corporate Counsel includes pieces on:

– 2010 Proxy Season Items
– New SLAB Narrows 14a–8(i)(7) Ordinary Business “Risk” Exclusion
– Staff Says It Won’t Necessarily Settle for Futures–Only Comments on Executive Compensation Disclosures–What That Will Mean For Issuers
– Other SLAB 14E Items
– A Few Thoughts on Proxy Access
– Can No Disclosure Be Good Disclosure?
– CFOCA Update
– More on Obtaining CFOCA Waiver Letters for Separate Financials of Acquired Businesses, Subsidiaries and Guarantors
– ABA Committee’s Statement of Effect of the FASB Codification on Audit Response Letters
– The Staff’s New Section 13(d)/(g) CDIs

Act Now: Get this issue on a complimentary basis when you try a 2010 no-risk trial today.

– Broc Romanek