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Describing the Issuer’s Business in Offering Documents

Preparing a description of the issuer's business for a disclosure document in a securities offering can be a challenging, yet satisfying, exercise for issuer's counsel.  Review some of the issues in the report on drafting the business description for an offering memorandum.


Technology and Organizational Effectiveness

Technology is important because of the impact it can have on the decisions a company makes regarding its strategy and the design of its organizational structure.   The role of technology in the overall conversion process–acquiring inputs, transforming the inputs into finished outputs (products and services) and marketing and selling the outputs to customers to generate capital to purchase more inputs and sustain the business–is discussed in a report on technology and organizational effectiveness.


New Form 990 Reporting Requirements for Tax-Exempt Organizations

In this report on new Form 990 reporting requirements learn more about the sweeping changes that have been made in the public disclosure obligations of tax-exempt organizations, particularly with respect to providing information on their governance practices.  Make sure your clients are in compliance!


Key Determinants of Organizational Effectiveness

An organization will survive only if it proves to be an effective means for realizing its stated goals and objectives, including the personal needs of the individual members of the organization and the requirements of other interested stakeholders.  See how your business stacks up against some of the key determinants of organizational effectiveness. 


Rules for Legal Audit Process

Before conducting a legal audit counsel should determine each of the steps in the audit process and make sure that they are document in the form of a description of the proposed audit methods and rules for the legal audit process.


New Business Concept Evaluation Worksheet

Before launching a new business be sure to consider the issues and questions included in the attached new business concept evaluation worksheet.


Identifying and Evaluating Prospective Suppliers

Supply chain relationships are key elements of any company's business strategy.  This week I am featuring a report on how to identify and evaluate prospective suppliers.


Checklist for Preparing Articles of Incorporation

Last week I discussed some common errors in drafting and filing the articles of incorporation.  Today I'd like to provide you with a simple checklist to follow when preparing the articles of incorporation to ensure that all legal and business requirements are satisfied.


Common Errors in Preparing and Filing Articles of Incorporation

One of the most embarrassing moments for corporate counsel is when the secretary of state rejects articles of incorporation when they are presented for filing.  As a preventive measure, it is important for counsel to be reminded of the following common errors in preparing and filing articles of incorporation: 

  • Rejection of the proposed articles of incorporation because the corporate name is not available.

  • Failure to conform the corporation's name as shown in the caption of the articles of incorporation to the name used in the first paragraph.

  • Failure to include a word denoting corporate status such as corporation, incorporated, or corporation, or an abbreviation thereof, in the corporate name when such is required under state law.

  • Failure to provide the street address, as opposed to a post office box, of both the corporation and its registered agent.

  • Failure to state the county in which the principal office of the corporation will be located.

  • Failure to state at least one principal purpose of the corporation, when required by state law.

  • Failure to set forth the number of shares the corporation is authorized to issue.

  • Failure to state the par value of the authorized shares, or to state that they are without par value, when required by state law.

  • Failure to pay the proper filing fees.

  • Failure to sign the check.

  • Failure to date and/or sign the articles of incorporation or the designation of registered agent, including the occasional omission altogether of the designation document.

  • Failure to type the incorporator's name under the signature (many signatures are illegible).

  • Failure to properly complete acknowledgments on the articles, when required by state law.


The content in this report has been adapted from material that will appear in Fall 2008 in Alan Gutterman’s publication entitled “Business Transactions Solutions” and is presented with permission of Thomson/West.  Copyright 2008 Thomson/West.  For more information or to order call 1-800-762-5272.  Alan Gutterman is the Founder/Principal of Gutterman Law & Business (, which publishes the Emerging Companies Blog and the Business Counselor Blog, and a Partner of The General Counsel LLC (






Final Pre-Implementation Strategy Review

It is clear that the strategic planning process can be time-consuming and requires a substantial amount of managerial resources.  Once the mission and strategy statements have been completed, and the goals and objectives have been established, the senior managers of the relevant business unit (or the firm as a whole in the case of corporate-level strategies) will obviously be eager to push forward.  Before proceeding, however, it is wise to have an objective, independent group composed of members that have not been involved in the strategy formulation process conduct a final pre-implementation strategy review.  This type of approach, which can also be used for specific “bet-the-company” transactions, introduces a “devil’s advocate” to the process in order to ensure that full consideration is given to the tough questions that need to be recognized and answered before the firm commits its resources to a particular strategy.  While it is not surprising that the strategy developers will often resist this approach, their cooperation and understanding can be solicited by assuring them that the members of the group are not interested in managing their business but rather are looking to gain a better understanding of how decisions have been made and the assumptions that are being used in developing the strategies.  The personal agendas of the reviewers and the strategy developers should not be allowed to interfere with the review process and the focus should remain on determining whether the proposed strategy is the best of all feasible alternatives even if it includes risks and minor defects that can only be recognized and not totally overcome.

The review group should always be led by someone who has no direct stake in the outcome of the review and is not part of the management hierarchy involved with creating and executing the strategy.  In this case of a review of a business unit strategy this means that the group leader should be a senior manager of another business unit.  Corporate-level strategies should be reviewed by groups overseen by an independent member of the board of directors with proven experience in strategy development who understands the overall organization of the company.  Group members should have a knack for being able to pose questions that focus specifically on the assumptions used in developing the proposed strategy since it is important to ensure that a wide range of possible scenarios have been considered.  Group members should also be reminded that it is not their role to come to conclusions and advocate their own answers to the questions that they raise, nor should they seek to develop their own alternative strategies.

The questions posed by the review group will obviously depend on the particular strategy under consideration; however, questions that probably should be asked in almost every instance include the following:

  • Is the strategy realistic and is it likely to produce long-term success for the business unit and/or the firm as a whole?

  • Is the strategy constructed in a way that it will withstand public scrutiny and reasonably anticipated turbulence in the relevant business environment?

  • Have the developers of the strategy taken past experiences and failures into account in assessing the likelihood of future success for the strategy?

  • Does it appear that the members of management hierarchy involved with creating and executing the strategy have had access to all relevant information, including dissenting views?

  • Has consideration been given to the impact that the strategy will have on existing businesses?

  • Have the strategy developers considered all reasonable options before settling on the specific strategy under consideration?

  • Do the advocates of the strategy demonstrate sufficient confidence in its likelihood of success and would they be willing to risk their personal resources on the ultimate outcome of the strategy?

The work of the review group should be respected and the managers associated with the development and execution of the particular strategy should be required to prepare some sort of formal response to the review even if it is ultimately decided to move forward with the strategy in essentially the form it was originally presented for review without significant modification to take into account the findings of the review group.

The discussion in this post is based on P.B. Carroll and C. Mui.  “7 Ways to Fail Big” Harvard Business Review, September 2008, 82-91, 86-87, and this material will appear in Fall 2008 in Alan Gutterman’s publication entitled “Business Transactions Solutions” and is presented with permission of Thomson/West.  Copyright 2008 Thomson/West.  For more information or to order call 1-800-762-5272.  Alan Gutterman is the Founder/Principal of Gutterman Law & Business (, which publishes the Emerging Companies Blog and the Business Counselor Blog, and a Partner of The General Counsel LLC (