The NASPP Blog

With the NASPP Conference just barely behind us, today I highlight some tips I picked up on working with your lawyers from one of the sessions at the Conference. While most of us dread having to run projects past legal, the fact is that your lawyers (both in-house and outside counsel) can be an important and helpful member of your team, as demonstrated by the session “Face Your Demons: How You and Your Stock Plan Lawyer Can Work Together More Effectively” (a complete production with skits, props, and even audience participation, the session also demonstrated that even lawyers can have a sense of humor).

Face Your Demons: How You and Your Stock Plan Lawyer Can Work Together More Effectively

Negotiating Vendor Service Agreements / Business Contracts

Your lawyers provide valuable assistance in reviewing vendor service contracts. For one thing, they are probably better at reading fine print than you are (and you don’t really want to read those contracts yourself anyway, do you)?

The salesperson may present the contract as a form agreement, but this is rarely the case. Your lawyers can spot important service limitations that might impact your business–such as limited customer support hours–or gaps in the services that are provided that might later prove critical and can help you modify the contract to better meet your needs.

Lawyers also make excellent partners in negotiations. While many of us are uncomfortable with negotiating, lawyers are typically good at it. Let them play the bad cop to your good cop and take some of the pressure off yourself.

Reduce Exposure of Audits and Litigation / Secure Better Value from Outside Counsel

Of course, one of the tasks lawyers do best is compliance–look to your lawyers for assistance with understanding the potential risk of an audit or litigation–including the likelihood of such an event occurring, possible penalties, and even “softer” impacts, such as public perception and employee morale. This allows you to make informed decisions when evaluating procedures and plan designs. Should you become aware of a compliance failure, your lawyers should be one of your first phone calls (after your manager, of course); they can help you assess the gravity of the situation and strategize an appropriate response.

And, because your lawyers are working with many different clients (and also know other lawyers that have lots of clients), they can be a valuable source of information on industry trends and best practices. Before deciding on a process or design, check with outside counsel to find out if there is a better way.

Solicit More Proactive Legal Advice

When implementing new plans or programs, don’t wait until it’s too late to talk to your lawyers. Get their input early in the process, while you can use their input to shape the program (e.g., making sure there aren’t any unexpected compliance pitfalls or better approaches). And don’t be afraid to push back–working with your lawyers should be a back and forth process.

Navigate Evolving International Issues

I’ve said it before, but it bears repeating–a global stock plan is not a do-it-yourself project. No matter how few employees or countries are involved, never offer stock compensation to non-U.S. employees without consulting outside counsel. (Think about it, you would never implement a plan in the United States, even for just a handful of employees, without legal assistance. The laws aren’t any less complex outside the United States.)

In addition to seeking their advice when new programs are implemented, consider meeting with your outside counsel on a regular basis (e.g., quarterly) to review developments outside the United States that might impact your plans so you can determine if further research is needed.

Did you miss this session? It’s not too late to hear the presentation; purchase the audio and materials today!

It’s Renewal Time
All NASPP memberships expire on a calendar-year basis. Renew your membership today and avoid the last minute rush on December 31.

Join Now and Get Three Months Free!
If you aren’t currently an NASPP member, now is the time to become one! Join the NASPP for 2011 and you’ll get the rest of 2010 for free.  Tell all your friends!

Don’t Miss Out–Conference Audio Available
If you weren’t able to attend the Conference or did attend but couldn’t get to all the sessions you wanted to (and with over 40 sessions, who could?), you can download the audio from any and all sessions in MP3 format.  Purchase just the sessions you want or save by purchasing a package of sessions.

NASPP “To Do” List
We have so much going on here at the NASPP that it can be hard to keep track of it all, so I keep an ongoing “to do” list for you here in my blog. 

• Purchase the audio for the 18th Annual NASPP Conference.
• Complete the Compliance-O-Meter quiz on ESPP Design.
• Take the “Question of the Week” challenge.
• Renew your NASPP membership for 2011 (if you aren’t an NASPP member, join today).

– Barbara