When You Think FINANCIAL REFORM, Think Fulbright. TM August 12, 2010 How the New Financial Reform Legislation Affects Publicly Held Companies: Disclosure,

When You Think FINANCIAL REFORM,Think Fulbright.TM

August 12, 2010

How the New Financial Reform Legislation Affects Publicly Held

Companies: Disclosure, Corporate Governance,

Enforcement and Other Requirements

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Today’s Presenters

Darryl Anderson

Partner, Fulbright & Jaworski L.L.P.Houston

Harva Dockery

Partner, Fulbright & Jaworski L.L.P.Dallas

Gregg Berman

Partner, Fulbright & Jaworski L.L.P.New York

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Gregg Berman

Corporate PartnerFulbright & Jaworski L.L.P.HoustonGBerman@fulbright.com

Harva Dockery

Corporate PartnerFulbright & Jaworski L.L.P.DallasHdockery@fulbright.com

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Dodd–Frank

Although aimed at the financial regulatory system, the Act will affect most public companies

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What You Need to Know

Corporate Governance Executive Compensation

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Provisions Related to Corporate Governance

Proxy Access : Not mandated but enabled CEO / Board Chairman Structure Disclosure Broker Voting Say on Pay Say on Golden Parachutes Enhanced Compensation Committee Standards Clawback Policy

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Provisions Requiring Enhanced Disclosure

Pay vs. Performance Internal Pay Ratio Hedging

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Other Aspects

Revised “accredited investor” definition

Timing and What Now?

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Darryl Anderson

Litigation PartnerFulbright & Jaworski L.L.P.HoustonDanderson@fulbright.com

Dodd-Frank Impact on Enforcement

Increased Governmental Enforcement

Increased Private Litigation

Rulemaking Process

Whistleblower Provision

“In any covered judicial or administrative action, or related action, the Commission . . . shall pay an award or awards to 1 or more whistleblowers who voluntarily provided original information to the Commission that led to the successful enforcement of the covered judicial or administrative action, or related action, an aggregate amount equal to—

(A) not less than 10 percent, in total, of what has been collected of the monetary sanctions imposed in the action or related actions; and

(B) not more than 30 percent, in total, of what has been collected of the monetary sanctions imposed in the action or related actions.”

Whistleblower Qualifications

Original information Led to successful enforcement action $1 million or more in aggregated sanctions Cannot be criminally convicted in relation to same

scheme Cannot be used to circumvent SOX reporting

requirements for auditors

Scope of Whistleblower Qualifying Activities

Anything enforceable by the SEC is subject to a whistleblower report

Protections Afforded Whistleblowers

Anti-retaliation provision No arbitration May proceed anonymously No reasonable basis for report required?

Administrative Proceedings

Monetary penalties available

Administrative proceedings a more viable forum

Expanded Substantive Liability

Aiding and Abetting Liability

Extraterritorial Enforcement Jurisdiction

Criminal Provisions

Statute of Limitations Extended

Review of Sentencing Guidelines

Sources of Increased Private Litigation

Increased disclosure obligations

Whistleblower actions

Potential restrictions on arbitration clauses

What the Future Holds

Rulemaking authority could lead to further increases

● Study of effect of arbitration provisions

● Study of fiduciary standards for broker-dealers

● Study of private aiding and abetting cause of action

Protecting Your Business from Increased Exposure in the Dodd-Frank World

Review and revise compliance programs

Make employee hotlines user-friendly

Evaluate use of arbitration provisions and implement protections

Stay abreast of the rulemaking activities that impact your business

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Harva Dockery

Corporate PartnerFulbright & Jaworski L.L.P.DallasHdockery@fulbright.com

Dodd-Frank and Diversity

Establishment of Offices of Minority and Women Inclusion for each agency

Duties of each office director

Procedures for review and evaluation of contract proposals and hiring service providers

Ability to cancel contracts

Promotion of diversity in each agency's workforce

Annual reports to Congress from each office

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Continuing Education Information

If you are requesting CLE credit for this presentation, please complete the evaluation that Fulbright will send via email tomorrow.

If you are viewing a recording of this web seminar, most state bar organizations will only allow you to claim self-study CLE. Please refer to your state’s CLE rules. If you have any questions regarding CLE approval of this course, please contact your bar administrator.

NY CLE Number 100812 If you should have any questions regarding credit, please

email Victoria Beard at vbeard@fulbright.com

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Questions?

Darryl Anderson

Partner, Houston

Fulbright & Jaworski L.L.P.

danderson@fulbright.com

713 651 5562

Gregg Berman

Partner, New York

Fulbright & Jaworski L.L.P.

gberman@fulbright.com

212 318 3388

Harva Dockery

Partner, Dallas

Fulbright & Jaworski L.L.P.

hdockery@fulbright.com

214 855 8369

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When You Think FINANCIAL REFORM,

Think Fulbright.TM

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