Foreign Corrupt Practices Act Compliance and PEG Policy

Foreign Corrupt Practices Act Compliance and PEG Policy
International Consulting Day Rate Compensation Policy - 2011-2012

LEAD

Introducing Party ,
if any,
to Actual
Lead Owner

Actual
Lead
Owner

Engagement
Lead

STAFFING
LEADS

COMPENSATION
for LEADS

1% of
Revenue

2% of
Revenue

SEE
BELOW

5% of
Revenue

COMPENSATION
for the
Engagement
Lead
on the Work

75%
of THEIR AGREED
DAY RATE
in Engagement

15%
of AGREED
DAY RATE of
Team Member #2

10%
of AGREED DAY
RATE
of each additional
Team Member #3,
etc.

COMPENSATION
for
Team Members
on the Work

70%
of THEIR AGREED
DAY RATE
in Engagement

Foreign Corrupt Practices Act - COMPLIANCE and PEG POLICY

US Cracks Down on Corporate Bribes
By DIONNE SEARCEY, WSJ 26May09

Selected Abstract of Article

The Justice Department is increasing its prosecutions of alleged acts of foreign bribery by U.S. corporations, forcing
them to take costly steps to defend against scrutiny.

The crackdown under the Foreign Corrupt Practices Act, or FCPA -- a post-Watergate law largely dormant for
decades -- now extends across five continents and penetrates entire industries, including energy and medical
devices. Among the companies currently under Justice Department review: Sun Microsystems Inc. and Royal Dutch
Shell PLC, according to the companies' disclosures.

At least 120 companies are under investigation, according to Mark Mendelsohn, a deputy chief in the Justice
Department division overseeing the prosecutions, up from 100 at the end of last year.
The effort began in the wake of a series of business scandals earlier this decade, including the collapse of Enron,
that stirred up a new corporate-reform movement.

Today, companies across the U.S. are working to figure out if they are at risk. In some instances, companies have
called the Justice Department to come clean, in hopes of obtaining leniency.

What is the Foreign Corrupt Practices Act or FCPA?

The law prohibits U.S. companies from paying, or offering to pay, foreign-government
officials or employees of state-owned companies to gain a business advantage. It covers
non-monetary gifts or offers in addition to cash payments, and is worded broadly enough
that it's spawning an army of consultants, some of whom once prosecuted bribery cases
for the Justice Department, who offer to interpret the gray areas.

The FCPA became law in 1977 amid investigations into alleged contributions to Richard
Nixon's re-election fund. At that time, a Securities and Exchange Commission inquiry
revealed that some companies had been maintaining offshore slush funds used to sway
business decisions abroad. After the passage of the 2002 Sarbanes-Oxley Act, which is
intended to hold executives more accountable for their companies' actions, the Justice
Department dusted off the FCPA law as part of the overall crackdown on corporate
shenanigans.

PEG Policy ref FCPA

It is very simple.

•        We don’t do it. We never pay “bribes” to anyone or government official or government.
•        We do, from time to time, use AGENTS under the Law of Agency – which is legitimate.
•        Where we use an AGENT, their active service tasks are well defined and actually provided.
•        Where we use an AGENT, agency costs/fees are customary and industry standard.
•        An example is we use Shipping Agencies to provide services for marine vessels.

WE do, however, have a LEAD Payments Policy:

•        LEAD Introductory Fee of 1% of our Booked, Billed and Collected (BB&C) related revenue
•        LEAD Opportunity Reward of 2% of our BB&C revenues for consulting
•        LEAD Staffing Reward of 5% of our BB&C revenues for a staffing placement
•        Engagement Annuity payable based on BB&C in any such engagement.

LEAD payments made are reviewed by the Advisory Board (Practice Leads) for transparency and control

- This is offered to providers of leads who are NOT an employee of the LEAD given.
- We have those who have provided leads, but have declined accepting annuities due to the corporate
policies of their employers. ASK THEM IF THEY HAVE SUCH POLICIES IN PLACE and get a response
IN WRITING.
- These LEAD payments are ONLY made to actual lead providers of qualified leads, NOT to Client
companies or their employees
- Employees of engaged firms are not offered nor given any compensation for PEG engagements with
their own company. They are barred from participating in the LEAD Payment Program. No other forms of
compensation are given nor acceptable.

Hope this helps define our policy. One reason we use structured project finance is its transparency.

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Project Executive Group