Hotline
December 01, 2003
Recent developments of interest to corporate counsel.
Allocating Administrative Costs: What Your Benefits Adminstrator Needs To Know
December 01, 2003
The Employee Benefit Security Administration of the Department of Labor (DOL) has recently announced a more liberal view toward charging tax-qualified retirement plan expenses against the accounts of participants in 401(k), ESOP, and other defined contribution plans. This article provides a brief overview of the kinds of expenses that plans may pay and then explains how the new DOL guidance provides employers and plan sponsors with greater flexibility in allocating these expenses to participant accounts.
In the Spotlight: Mutual Subrogation Waiver Benefits Landlord and Tenant
December 01, 2003
A very important lease provision, particularly from the tenant's perspective, is an effective subrogation waiver. The subrogation waiver essentially provides that in the event of a casualty that is caused by the negligence of one party to a lease, the negligent party is nonetheless not liable for the resulting damage to the extent that the damage is either covered by applicable insurance proceeds or to the extent it would have been covered by insurance proceeds had the other party to the lease maintained the insurance as required under the lease. Subrogation waivers provide, in effect, that both parties to the lease benefit from the casualty insurance maintained by either party. This concept is especially fair to the tenant in net lease situations where the tenant pays its pro rata share of the landlord's casualty insurance. Landlords also benefit from a mutual subrogation waiver to the extent that the tenant's leasehold improvements, fixtures, and personal property are damaged or destroyed due to the landlord's negligence.
Monitoring the Nasdaq Capital Gains
December 01, 2003
We are at a wonderful period in time in many ways. We are enjoying the year-end holiday season with our family and friends, the Dow index has crested the…
Advice on Avoiding Misunderstandings in Premises Measurement
December 01, 2003
What could be simpler, more mundane, and less worthy of a lawyer's attention than lease provisions dealing with a business term — the square footage of the premises? However, a lawyer's failure to define the agreed-upon method of its measurement properly in the lease can lead to headaches and even litigation as the lease term progresses. Because measurement standards are not mandatory or legislated, the parties are free, depending on their relative market positions, to agree upon the method to be used in the lease. Often the measurement of square footage is referred to in terms that are imprecise and have no legal definition. Depending on the area where the building is located, measurement methods may vary and a landlord may have its own method that is a modified form of a particular standard of measurement. Without a specified measurement standard and the right to confirm a landlord's measurement, a tenant could end up paying more for its space than it intended (or budgeted); and may later find itself unable as a practical matter to contest a landlord's measurement of an expansion space.
Trends in Deal Terms
December 01, 2003
Set forth below are our findings based on a review of the 34 publicly-reported venture capital financings that took place in the Mid-Atlantic region during…
Board Protection: Individual Liability Insurance for Independent Directors
December 01, 2003
In the wake of recent corporate governance scandals, independent directors of public companies face increased levels of scrutiny and heightened prospects for the risk of personal liability. Recent court decisions have criticized directors of public and private companies for insufficient attention to their duties. The Sarbanes-Oxley Act of 2002 (S-O) and the proposed corporate governance reforms of the New York Stock Exchange (NYSE) and the Nasdaq Stock Market (Nasdaq) call for decisions about critical matters such as accounting policies and executive compensation to be made solely by directors who meet rigorous independence standards. In response to the ongoing tide of corporate governance reforms as well as the rising numbers of shareholder lawsuits and escalating settlement costs, insurance companies have sharply increased premiums for traditional directors' and officers' liability insurance (D&O insurance), which typically insures officers and directors as well as the company itself. At the same time, insurers have narrowed the scope of coverage of D&O insurance policies in terms of both dollar limits and the types of insured events.
Fax Rule Facts: Complying with the New Fax Rule Under the Telephone Consumer Protection Act
December 01, 2003
Have you ever sent a fax containing a lease agreement, listing agreement, property informational brochure or estoppel certificate? What about a fax with a purchase order, invoice or a request for a proposal from a vendor of property-related services or goods? In the leasing world, who hasn't? At the same time, have you ever considered obtaining prior written consent from the recipient to authorize your transmission of that fax? In many, if not all, cases, the answer is likely to be "who has?" In the not-too-distant future, that answer probably will need to be changed. Read on to find out why — and whether you will be among the crowd that must obtain that prior authorization before turning on your fax machine.
The Leasing Hotline
December 01, 2003
Highlights of the latest Commercial Leasing cases from around the country.
