Public companies have many compliance rules and regulations pertaining to issuance of their securities and information dissemination and disclosure. Much of this is governed by the Securities Act of 1933 and The Securities Exchange Act of 1934. However, effective representation of public companies entails knowledge of a broad range of legal and regulatory issues beyond just these federal securities laws.
D&O Liability and Corporate Governance
Public companies have many directors and a diverse and large number of shareholders. Procedure, process, and formality rule the actions of public company boards. Directors of public companies not only have the traditional fiduciary duties of care and loyalty but also are subject to the judicially-developed business judgment rule. Directors of public companies have real risk of liability to their shareholders. And there can be liability to non-shareholders too. Avoidance of liability is critical to all directors and having adequate D&O insurance is a must.
At Carlile Patchen & Murphy we understand the role of directors of public companies and the importance of corporate governance policies and standards. Our lawyers have the experience and knowledge to advise corporate boards and give them the counsel they need to perform their duties in a manner that fulfills their duties and avoids liability.
Beyond securities laws and rules of corporate governance, there are additional laws and regulations as well – e.g., stock exchange rules (e.g., NASDAQ Market and NYSE) and the Sarbanes-Oxley Act of 2002. The laws and rules affecting public companies do not reside in a static environment. Old rules are changed and new rules are promulgated with frequency. Our lawyers stay abreast of new developments so that we can provide sound counsel and advice in this ever-changing landscape of rule-making and regulation.
Areas of Practice
Our practice includes advising companies seeking to go public and public companies and their management, officers and directors. The experience of our lawyers includes serving our clients on the following:
- Initial, secondary and follow-on securities offerings.
- Governance and compliance issues, including preparation and review of committee charters, codes of conduct and other corporate programs, policies and procedures.
- Best practices for boards and board committees.
- Sarbanes-Oxley Act governance requirements.
- Governance requirements of securities exchanges.
- Issues for compensation and audit committees with respect to SEC, NYSE and NASDAQ rules.
- Director and officer fiduciary duties and responsibilities.
- Board and management issues, including conflicts of interest, related party transactions and executive compensation.
- SEC and state disclosure issues in connection with periodic reporting requirements under the Securities Act of 1933, the Securities Exchange Act of 1934 and the Sarbanes-Oxley Act and related liability considerations.
- Compliance with Exchange rules.
- Issues concerning sales of securities by insiders and affiliates, including Section 16 compliance, Rule 144 compliance and insider trading guidelines and restrictions.
- Proxy Statements, Form 8-K, Form 10-K, Form 10-Q and Forms 3, 4, and 5 – preparation and review.
- Assisting public companies in going private transactions.
For over 40 years our firm has provided the guidance and advice crucial to our clients in the public company arena, including companies that have pursued their IPO. Our lawyers combine their legal and regulatory expertise with client-specific knowledge to: help clients optimize the benefits of accessing public markets for their securities; assist our clients’ directors and officers with performing their duties ethically and responsibly; and, help our clients achieve the goals of their companies.