United States: The SEC Strikes Again: Undisclosed Executive Perks & Related Person Transactions

THE SEC STRIKES AGAIN: UNDISCLOSED EXECUTIVE PERKS & RELATED PERSON TRANSACTIONS

Two recent SEC enforcement actions involving executive perks and related person transactions are a reminder that disclosure deficiencies in these areas can attract SEC scrutiny. The extent to which this represents a new trend or merely the carryover of investigations started under the prior leadership remains to be seen, but the recent activities warrant renewed attention to these matters.

Recent Perk-Related Enforcement

Over the last few years, a growing list of companies have found themselves on the wrong side of an SEC enforcement action for failing to disclose in their public filings perquisites ("perks") provided to their executives. In general, the actions have alleged either misconduct by executives who practiced deception to obtain unwarranted benefits or the absence of effective corporate controls. The companies targeted were generally (sometimes very) small, growth-oriented companies.

THE DOW CHEMICAL SETTLEMENT

Enter the SEC's settlement with The Dow Chemical Company ("Dow") on July 2, 2018. Dow is a household name with tens of thousands of employees and roots dating back to the 19th century. After its 2017 merger with DuPont, DowDuPont Inc. is among the 30 companies currently making up the Dow Jones Industrial Average. As such, it stands out among com­panies that have recently seen SEC enforcement action over perk disclosure.

Dow's SEC order does not allege executive misconduct. While it does allege insufficient procedures for complying with the SEC's executive compensation disclosure rules, those defi­ciencies seem, at least at first blush, surprisingly mundane. The SEC says that Dow inappropriately applied a "business purpose" standard to determine whether a benefit would be disclosed as a perk rather than the SEC's more stringent "integrally and directly related to [job] performance" standard. In the eyes of the SEC, Dow also did not adequately train its employees in the art of proper perquisite disclosure. But the order gives no indication of how the alleged breakdown in Dow's processes occurred and therefore does little to help steer other companies toward the right side of the perk line.

The amount Dow agreed to pay as a fine to the SEC, $1.75 million, is among the highest paid by any company in a perk-related enforcement action since 2015 (though not relative to its resources, clearly). The order further requires Dow to hire (and pay for) an independent consultant to review its policies, procedures and controls for complying with the SEC's perk disclosure rules. Dow must implement recommended changes (negotiating for any changes, but with the consultant ultimately calling the shots) and then subject itself to compliance monitoring for two years.

The SEC says approximately $3 million in executive perquisites for Dow's CEO, Andrew Liveris, were not "adequately evalu­ated and disclosed." The order provides only a high level list of the types of undisclosed perks, which were "among other things, travel to outside board meetings, sporting events and personal activities; club memberships; limited use of personal assistant office time; and membership fees to sit on the board of a charitable organization." The list itself raises more ques­tions than it answers. What, for example, constitutes "limited use of personal assistant office time" and how would it be monitored and valued? Are there any types of sporting events attendance at which would be integrally and directly related to one's job performance? While the magnitude of the unreported expenditures catches the eye, also notable is the fine ($1.75 million) relative to the total undisclosed amount ($3 million). The order hints at the considerable flexibility the SEC has in construing how many acts or omissions may lead to separate penalties (generally each capped at the higher of $775,000, adjusted for inflation, or the amount of pecuniary gain) against a company, giving it leverage in negotiated settlements.

COMPLAINT AGAINST ENERGY XXI, LTD.'S FORMER CEO

Two weeks after the Dow settlement, the SEC's enforcement division filed a complaint against John D. Schiller, the former CEO of oil and gas company Energy XXI, Ltd. ("EXXI"), for perk nondisclosure violations, among other things. Mr. Schiller is reported to have settled that case with the SEC.1 According to the SEC, Mr. Schiller obtained over $1 million in perquisites over a five-year period that were "unreasonable, personal in nature, and/or not supported by sufficient documentation." Mr. Schiller's expenses allegedly included, among other things:

  • $323,000 to keep a private bar for certain senior EXXI executives and their guests stocked with liquor and ci­gars over a five-year period;
  • $43,000 for use of EXXI's company aircraft to attend his alma mater's college football game with other indus­try executives;
  • A combined $54,000 for a New York shopping trip for Mr. Schiller's wife and the spouses of other board mem­bers and members of senior management and first-class plane tickets for Mr. Schiller's wife and daughter to travel to London, in each case, in connection with EXXI board meetings; and
  • $15,000 as a charitable donation to the private school for Mr. Schiller's daughter.

The SEC's list combines items that appear purely personal in nature with others that seem to have at least some business purpose, once again reinforcing the exacting nature of the SEC perk disclosure standard. The $323,000 bar provisions charge, to which "only a dozen or so persons had keycard access," is a noteworthy reminder that access to executive-only facilities and their trappings may constitute perks subject to public disclosure. By apparently ascribing the full value of the restocking costs to Mr. Schiller (rather than some mea­sure of his proportionate share), the complaint sidesteps, but hints at, some of the thornier disclosure issues that can arise in valuing executive-facility perks. The charitable con­tribution item underlines the potential risks associated with corporate charitable contributions to institutions attended by an executive's (or director's) family member.

A TRIP BACK IN TIME

To understand the narrowness of the SEC's current perk dis­closure standard, we need to travel back to the late 1990s and early 2000s. At that time, providing extensive executive perks was not uncommon, and many companies had devel­oped a practice of disclosing them in a minimalist fashion.

While the SEC had by then been issuing guidance on perk disclosure for decades, it was a 2002 divorce filing by the wife of legendary former General Electric chairman and CEO Jack Welch that caught the attention of the media and the SEC.2 Mr. Welch had by then retired from his CEO day job but had signed on to consult for the company. The company had disclosed in its proxy statements that he was making merely $86,000 in cash compensation but would also receive "life­time access to Company facilities and services comparable to those which are currently made available to him by the Company."3 A seemingly inconsequential "extra" was later revealed to be an oblique reference to a lavish set of perks that far outstripped the value of the modest cash compen­sation. Among other things, Mr. Welch was provided with use of a $50,000 per month furnished Manhattan apart­ment, unlimited use of GE's planes, unrestricted access to a chauffeured limousine and a bodyguard for various speaking engagements, including Mr. Welch's book tour. In the first year following his retirement these perks reportedly had a total value of approximately $2.5 million (approximately $3.56 million in today's dollars).

The SEC was not pleased. In September 2004, the SEC announced a settlement with GE over its failure to "fully and accurately describe the retirement benefits Welch was entitled to receive from the company."

UNPACKING THE SEC'S PERK DISCLOSURE STANDARD

With the ink on the GE settlement barely dry, the SEC set out over the next two years on an ambitious and sweeping rewrite of the executive compensation disclosure rules. Along with adopting other rules that reduced the de minimis thresh­old for omitting perk disclosure altogether or not separately identifying perks, in August 2006 the SEC finalized a stricter standard for required perk disclosure.

The SEC specified that unless an item is "integrally and directly related to the performance of the executive's duties," it must be disclosed as a perk if it confers a direct or indirect benefit on the executive that has a personal aspect, regard­less of whether there is a business purpose. An exception is for personal benefits that are made generally available on a nondiscriminatory basis to all employees. If an item is integrally and directly related to the performance of the executive's duties, the inquiry is complete. For example, companies need not disclose the incremental value associat­ed with a luxury car over an economy car if the purpose of the rental is integrally and directly related to a business purpose. Despite some commenters' objections that "business purpose" should be considered in determining whether an item should be considered to be a perk, the SEC did not change its pro­posed standard when finalizing the current rules.

The SEC acknowledges that its standard may be stricter than rules related to tax deductions or determining whether an item constitutes proper use of corporate assets under state law. Purposefully, the SEC adopted a principles-based approach to identifying perks, rather than a bright line, to discourage avoidance and facilitate evolution of disclosure along with corporate perk practices. However, the SEC's releases for the proposed and final rules did give certain specific examples:

Perks Under SEC Rules

Not Perks Under SEC Rules

Company-provided aircraft, yachts or other watercraft

Office space at a company business location

Commuter transportation services

A reserved parking space that is closer but not otherwise preferential

Commuting expenses (whether or not for the company's convenience or benefit)

Additional clerical or secretarial services devoted to company matters

Additional clerical or secretarial services devoted to personal matters4

Travel to and from business meetings

Investment management services

Other business travel

Club memberships not exclusively for business entertainment purposes

Business entertainment

Personal financial or tax advice

Security during business travel

Personal travel using vehicles owned or leased by the company

Itemized expense accounts the use of which is limited to business purposes

Personal travel otherwise financed by the company

Personal use of other property owned or leased by the company

Housing and other living expenses (including but not limited to relocation assistance and payments for the executive or director to stay at his or her personal residence)

Security provided at a personal residence or during personal travel

Discounts on the company's products or services not generally available to employees on a nondiscriminatory basis

 

EMERGING PATTERNS IN RECENT PERK-RELATED ENFORCEMENT ACTIONS

Since 2015, there has been a stream of perk-related SEC enforcement actions. Taken together, these actions indicate that the SEC continues to construe the current rules strictly and will hold companies accountable for even inadvertent failures to disclose perks if the SEC determines the failure is the result of lax corporate controls.

While the number of cases is limited, the settlements sug­gest some patterns:

  • Monetary settlements have ranged from ~0% to ~7,000% (~400% putting aside the Marrone Bio Innovations, Inc. matter described below) of the total undisclosed amounts, with the dollar settlements ranging from $0 to $1.75 mil­lion. In some cases, however, the SEC has made multiple claims against the subject company (some unrelated to perks), so the settlement amount reflects a mixed penal­ty (including in the Marrone Bio Innovations, Inc. matter, which was largely focused on other issues).
  • Where the executives are alleged to have engaged in de­ceptive practices, such as submitting falsified receipts or making exceptional, undocumented claims for reimburse­ments, the SEC has acknowledged leniency for companies that obtain reimbursements from executives for inappropri­ate corporate disbursements and pursue other appropriate remedial actions (including discipline/termination of exec­utives in certain cases).
  • Where disclosure failures are due to failures of corporate controls, the SEC will require the appointment of an inde­pendent consultant to review and oversee the implementa­tion of stricter corporate policies and procedures.

The chart below summarizes certain recent perk-related SEC enforcement actions.5

Company

Date

Approximate Amount of Undisclosed Perks

Other Allegations Unrelated to Perks?

Monetary Settlement

Independent Consultant Requirement?

Allegations of Executive Deception?

The Dow Chemical Company

July 2, 2018

$3 million over 5 years*

No

$1.75 million

Yes

No

Provectus Biopharmaceuticals, Inc.

December 12, 2017

$3.4 million over 5 years

No

$0**

Yes

Yes

MDC Partners Inc.

January 18, 2017

$11.3 million over 6 years*

Yes

$1.5 million**

No

Yes

Marrone Bio

Innovations, Inc.

February

17, 2016

$25,000 over 2 years

Yes

$1.75 million

No

Yes

MusclePharm Corporation

September 8, 2015

$482,000 over 4.5 years

Yes

$700,000 plus interest

Yes

No

PolyCom, Inc.

March 31, 2015

$190,000 over 4 years

No

$750,000**

No

Yes

* Amount was reported to have been partially reimbursed to the company by the executive.

** In the enforcement order, the SEC favorably cited the company's remedial efforts after disclosure deficiencies were identified.

PUTTING THE DOW SETTLEMENT IN CONTEXT

The SEC's enforcement action against Dow could suggest a new, stricter stance toward perk nondisclosure infractions. If Dow, with all its resources, can't get these things right without the SEC slapping it down, what chance do the little guys stand?

However, there are some factors operating outside the four corners of the SEC's enforcement order that may cast it in a different light. In August 2014, a former Dow fraud inves­tigator filed a lawsuit against Dow claiming that Dow had unlawfully terminated her employment in October 2013 after she raised concerns about potential financial state­ment fraud, including as a result of certain unreported ex­ecutive perquisites. The complaint cites $719,000 worth of unreported personal expenses for Mr. Liveris, including a $218,938 trip for him and his family to the 2010 Super Bowl, as well as a 2010 World Cup trip, a safari in Africa and trip to the 2010 Masters golf tournament. It also alleges payments, falsely identified as routine business expenses, to charities closely linked to Mr. Liveris. After losing a motion to dismiss in December 2014, Dow settled the whistleblow­er retaliation suit in early 2015.

While the allegations in the complaint offer plausible, though unverified, details to fill out the generalities used in the SEC's order ("travel to outside board meetings, sporting events and personal activities" and "membership fees to sit on the board of a charitable organization"), the settlement order leaves us wanting additional facts to assess the nature of the undisclosed compensation and the procedural defi­ciencies that allowed for it.

Prior to the SEC's announcement of the settlement, Dow had not disclosed in its public filings the existence of the SEC's inquiry. The SEC was undoubtedly aware of allegations in the whistleblower complaint, which likely precipitated its involvement in the case. The language in a settlement order is the subject of negotiation between the defendant and the SEC enforcement staff. It would not be surprising if Dow preferred not to have the details of its alleged transgressions spelled out in the order. The lack of specificity, however, leaves others who would like to learn from these mistakes scratching their heads.

Related Person and Form 8-K Allegations Involving EXXI

Beyond the perk disclosure deficiencies noted above, the SEC took aim at several other activities related to EXXI by Mr. Schiller, EXXI director Norman M.K. Louie and Mount Kellett Capital Management LP ("Mount Kellett"), EXXI's then-largest shareholder, for whom Mr. Louie worked as a portfolio manager.6

Among other things, the SEC accuses Mr. Schiller of financing an "extravagant lifestyle" by entangling his personal financ­es with those of EXXI, leading to a failure to report related person transactions. The SEC's related person rules7 require disclosure of any transaction (i) that occurred during a given fiscal year, or that is currently proposed, (ii) in which a subject company was or is to be a participant, (iii) with an amount involved of at least $120,000 and (iv) in which a related person had or will have a direct or indirect material interest.

The arrangement allegedly worked as follows: Mr. Schiller had pledged a stock portfolio largely consisting of EXXI stock in order to secure over $23 million in loans. When EXXI's stock dropped in value, Mr. Schiller was facing a series of margin calls, which drove him to obtain $7.5 million in personal loans from the three company vendors.8 EXXI then awarded the vendors new business or improved the vendors' business terms with EXXI. The SEC contends that this constituted a related person transaction because Mr. Schiller had a material interest in the vendors' business with EXXI as a result of the personal loans he received in exchange for future EXXI busi­ness. Despite the fact that the new business arrangements followed the loans (which could arguably undercut Mr. Schil­ler's interest in them), the SEC also alleges that two of the vendors threatened to call the loans after they were made if the promised business did not materialize.

The SEC further claims that Mr. Schiller allegedly obtained a $3 million loan from Mr. Louie at a time when Mr. Louie was a candidate to join EXXI's board. The failure of Mr. Louie and Mr. Schiller to disclose the arrangement to EXXI led EXXI to file an incorrect Form 8-K upon Mr. Louie later joining the board that failed to mention the loan. Mr. Schiller, after allegedly failing to disclose the loan, voted in favor of Mr. Louie's appointment to the board.

While the complaint and settlement cast EXXI as unaware of Mr. Schiller's loans from the vendors and Mr. Louie, the SEC does not hold EXXI out as completely blameless. On one hand, the SEC faults Mr. Schiller for omitting information on one of the vendor loans on a director and officer ("D&O") questionnaire that expressly asked about related person transactions, and says that EXXI's senior legal officer repeat­edly solicited a D&O questionnaire from Mr. Louie. However, the documents also make clear that EXXI personnel did not insist that Mr. Louie actually complete the D&O ques­tionnaire prior to the board vote on Mr. Louie's appointment (although the full board was apparently unaware of that fact). It was not until ten months after the D&O questionnaire was first solicited, and seven months after Mr. Louie supposedly became aware of the SEC's investigation, that he filled out a D&O questionnaire, which disclosed the $3 million loan.

Actions for the Proxy Offseason

What is clear is that the SEC continues to demand that perk disclosure adhere to a high standard compared to other ar­eas of law and that ignoring, whether intentionally or not, that standard presents some peril. As a threshold matter, in­dividuals responsible for preparing executive compensation disclosure need to be familiar with the SEC's perk disclosure standard. Those individuals must be empowered to find the information within the company to provide accurate disclo­sure. While that may seem obvious, in our experience, inter­nal "silo-ing" of human resources, finance, legal and other functions often serves as a barrier. Assigning one person re­sponsibility to quarterback these issues is often useful. Fur­ther, we recommend that companies review reimbursement policies and procedures with the SEC's disclosure standard in mind, and make sure they both conform to high standards of verification and recordkeeping and are in fact followed.

There is only so much that can be done to guard against a director or officer affirmatively concealing information from a company about related party transactions, but the EXXI-related enforcement actions do suggest some ac­tions for companies to take. Of course, companies should make sure their D&O questionnaires comprehensively cover related person transactions and are timely completed. A failure to adequately learn about related person transac­tions and other potential conflicts of interest may have impli­cations not only for required public disclosures, but also for stock exchange listing requirements and independence standards under a company's own governance policies or state law (e.g., special board committee membership). Accordingly, in some cases, companies may wish to supple­ment basic, broad questions on D&O questionnaires about related person transactions and potential conflicts of inter­est with specific prompts. Companies should also make sure directors and officers are aware of the need to provide timely updates to the company if related person transactions or potential conflicts of interest arise between D&O question­naire cycles.

Finally, the complaint against Mr. Schiller also indirectly demonstrates the risk of director and officer stock pledg­ing. If a company does not yet have an anti-pledging policy, it should strongly consider adopting one, and if it does, it should review the policy's adequacy.

Footnotes

1 The SEC's public announcement indicated that Mr. Schiller consented to a $180,000 fine and a five-year bar from serving as a public company director or officer.

2 The SEC also pursued perk-related enforcement against Tyson Foods in 2005.

3 GE had also filed the retirement and consulting agreement itself, which added that the "facilities and services" to which Mr. Welch would have access included "aircraft, cars, office, apartments, and financial planning services."

4 This enumerated item may explain the reference to "limited use of personal assistant office time" in the Dow settlement, although the facts in the Dow case around that item remain elusive.

5 EXXI was not named in the complaint against Mr. Schiller or the separate settlement, also filed on July 16, 2018, with an EXXI director and EXXI's largest shareholder. However, EXXI filed for Chapter 11 bankruptcy in 2016 and its assets were sold to a successor at the end of 2016.

6 Mount Kellett was accused by the SEC of failing to disclose that it had taken substantial steps to actively participate in the governance of EXXI by filing a timely Schedule 13D.

7 Item 404 of Regulation S-K defines a "related person" to include a company's executive officers, directors (including nominees), certain significant shareholders, and their immediate family members.

8 Section 402 of the Sarbanes-Oxley Act, which prohibits loans from the company to directors and officers, foreclosed Schiller's turning to the company to help out with the margin calls.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Similar Articles
Relevancy Powered by MondaqAI
 
In association with
Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions