Broc Romanek is Editor of CorporateAffairs.tv, TheCorporateCounsel.net, CompensationStandards.com & DealLawyers.com. He also serves as Editor for these print newsletters: Deal Lawyers; Compensation Standards & the Corporate Governance Advisor. He is Commissioner of TheCorporateCounsel.net's "Blue Justice League" & curator of its "Deal Cube Museum."
Today, Corp Fin Shelley Parratt delivered this important keynote speech regarding what the SEC Staff expects from 2010 executive compensation disclosures, as well as observations from the ’09 proxy season (eg. still not enough “analysis” in the CD&A). Among other important points that I will cover in this blog later this week, Shelley raised this point regarding how the Staff will administer the comment process in the near future:
It means that after three years of futures comments, we expect companies and their advisors to understand our rules and apply them thoroughly. So, any company that waits until it receives staff comments to comply with the disclosure requirements should be prepared to amend its filings if it does not materially comply with the rules.
Shelley addressed several other crucial points during a Q&A period not covered in her posted speech. The video archive of her keynote should be available in our archived Conference sometime tomorrow for those that want to see that…
Today is the “Tackling Your 2010 Compensation Disclosures: The 4th Annual Proxy Disclosure Conference”; tomorrow is the “6th Annual Executive Compensation Conference.” Note you can still register to watch online by using your credit card and getting an ID/pw kicked out automatically to you without having to interface with our Staff (but you can still interface with them if you need to). Both Conferences are paired together; two Conferences for the price of one.
– How to Attend by Video Webcast: If you are registered to attend online, just go to the home page of TheCorporateCounsel.net or CompensationStandards.com to watch it live or by archive (note that it will take about a day to post the video archives after it’s shown live). A prominent link called “Enter the Conference” on the home pages of those sites will take you directly to today’s Conference.
Remember to use the ID and password that you received for the Conferences (which may not be your normal ID/password for TheCorporateCounsel.net or CompensationStandards.com). If you are experiencing technical problems, follow these webcast troubleshooting tips. Here are the Conference Agendas; times are Pacific.
– How to Earn CLE Online: Please read these FAQs about Earning CLE carefully to see if that is possible for you to earn CLE for watching online – and if so, how to accomplish that. Remember you will first need to input your bar number(s) and that you will need to click on the periodic “prompts” all throughout each Conference to earn credit. Both Conferences will be available for CLE credit in all states except for a few (but hours for each state vary; see the CLE list for each Conference in the FAQs).
– How Directors Can Earn ISS Credit: For those directors attending by video webcast, you should sign-up for ISS director education credit using this form. This is meant only to facilitate providing information to ISS; they are the ones in charge of accreditation and any disputes will need to be taken up with them.
Black & Decker’s CEO Does the Right Thing? Foregoes Change-of-Control Payment
I loved Michelle Leder’s title of her footnoted.org blog recently entitled “On Black and Decker’s CEO and unicorns…“. Michelle was referring to the Form 8-K filed by Black & Decker which reveals that its CEO would forego $20 million in severance, a sum he would be entitled to under his arrangements with the company as triggered by this week’s announced merger with Stanley Tools. The Washington Post ran this article last week noting how this move is perhaps not as generous as it seems.
And here is a response from a member:
I don’t mean to throw stones, but Mr. Archibald is 66 years old. Why is he entitled to three years severance in the first place?
Based on my review of his new three year Executive Chairman Agreement, he is entitled to a base salary of $1.5 million per year, a target bonus of $1.875 million per year and long-term incentives of $6.65 million per year, (of which 50% is in stock options and 50% in restricted stock). Add to that, a 1 million share “sign-on” stock option grant (estimated value $15 million) and a Synergy Bonus Amount of as much as $45 million. All in, he could earn $90 million over the next three years, which would easily make up for his contract waiver if the company performs.
It is also worth noting that his current SERP is worth $35 million as of December 31, 2008, and he retained the right to an enhanced SERP if he is terminated before the end of the new contract term (i.e., he gets additional years of service and his foregone severance is included in the benefit calculation).
While I am glad to see a CEO waiving severance, it looks to me like he is getting it back, and then some.
You may also want to read Paul Hodgson’s “Extraordinary merger bonuses at Pfizer” from The Corporate Library Blog. Also check out this NY Times article from the front page yesterday with a quote from Jesse Brill.
Reminder: Many Companies Need to Amend for Section 162(m) by Year End
Mike Melbinger of Winston & Strawn recently issued this reminder in “Melbinger’s Compensation Blog” on CompensationStandards.com:
Many companies will need to amend their employment agreements, equity plans and awards, and other incentive plans and agreements by December 31, 2009, to preserve the deductibility of performance-based awards and amounts under Code Section 162(m) [the $1 million limit on public companies ability to deduct compensation payments to its named executive officers] in light of Rev. Rul. 2008-13.
Background: Rev. Rul. 2008-13 held that if a plan or agreement provides for payment following an executive’s termination without cause, for good reason, or due to retirement, the plan or agreement does not pay “remuneration payable solely on account of the attainment of one or more performance goals,” as may be required by Code Sec. 162(m) and Treas. Reg. §1.162-27(e)(2)(i). Therefore, agreements providing for the accelerated vesting of performance-based cash or equity awards and a payment regardless of actual performance upon retirement, termination of the executive by the company without cause, or termination by the executive for good reason, would cause the awards to fail to satisfy 162(m)’s performance-based exception – even if the accelerated vesting and payout is never triggered. (The IRS first took this position in PLR 200804004.)
The IRS’ rationale for this position was simple: terminations without cause, for good reason, or due to voluntary retirement, are not listed as permissible payment events under the 162(m) regulations. The IRS has also pointed out that, under the sample definitions of “cause” and “good reason” set forth in the ruling, the involuntary termination may arise as a result of the employee’s poor performance and failure to meet the performance goal.
Effective Date Transition Rules: The IRS declared that it would not apply the holdings in the Rev. Rul. to disallow a deduction for any compensation that otherwise satisfies the requirements for qualified performance-based compensation under 162(m) and that is paid under a plan or agreement with payment terms similar to those in the ruling if either:
– The performance period for such compensation begins on or before January 1, 2009 or
– The compensation is paid pursuant to the terms of an employment contract as in effect (without respect to future renewals or extensions, including renewals or extensions that occur automatically absent further action of one or more of the parties to the contract) on February 21, 2008.
Thus, compensation paid for 2009 performance under most agreements and programs was exempt.
For most companies, the 2009 performance period is ending and, therefore, the delayed effective date under Rev. Rul. 2008-13 will not be available much longer. Every company should consider whether it needs to revise its performance-based compensation plans and agreements to comply with Rev. Rul. 2008-13 and, if it must, how to revise the plans and agreements to achieve the original purposes of the acceleration. Remember, Rev. Rul. 2008-13 would deny deductibility to plans and agreements with the offending language even if the acceleration event never occurs.
Mike also was the first one to blog about the IRS starting Section 409A audits about a month ago. Compensation newsletters I’ve seen are only now getting wind of this development…
Following up on the giant insider-trading case a few weeks ago against Raj Rajaratnam and Galleon Management, the SEC brought insider trading charges against 13 more yesterday, including charges against a pair of lawyers for tipping inside information in exchange for kickbacks.
This story was interesting not only for the involvement of Wall Street lawyers (see the WSJ Law Blog for a discussion of how often lawyers are involved in insider trading – answer: it’s rare), but for the colorful nickname of one of the defendants – “the Octopussy” – as well as notable details about the use of disposable cell phones. As noted by this NY Times article, this story has Hollywood potential written all over it – one of the main characters is named “Roomy Khan”! Another is “Deep Shah”!
Enforcement Director Rob Khuzami gave these remarks about how insider trading is a corruption of the basic principle that the markets are fair, including these memorable words:
Goffer would promptly tip the other traders we charge today, at times going to such extraordinary lengths to cover his tracks that he used disposable cell phones.
He gave one of his tippees a disposable cell phone that had two programmed phone numbers labeled “you” and “me.”
After the insider trading was complete, Goffer destroyed the disposable cell phone by removing the SIM card, biting it, and breaking the phone in half.
He threw away half of the phone, and then instructed his tippee to dispose of the other half.
Needless to say, these antics might be appropriate in a James Bond movie.
But they have no place among Wall Street professionals who participate in our capital markets.
The ethical and legal judgments of these defendants were flatly wrong.
They weren’t close calls.
They weren’t nuanced.
They weren’t in gray areas.
As an aside, the SEC’s new Division of Risk, Strategy, and Financial Innovation is getting off the ground by announcing the hiring of three senior people…
US Supreme Court: Oral Arguments for Jones v. Harris
Last month, I blogged about the importance of the US Supreme Court’s Jones v. Harris case since it could impact the fiduciary duties of directors, including this podcast. Oral arguments were held this week and here are some reactions:
Yesterday, as noted in this NY Times article, the House Financial Services Committee passed the “Investor Protection Act” by a vote of 41 to 28. The bill includes an additional $1 billion-plus for the SEC’s budget and the proxy access provision blogged about recently. The Act now moves to the full House to be considered in the coming weeks, with a vote predicted to be held in early December.
The Adler-Garrett amendment – which exempts companies with a market cap of less than $75 million from having to comply with SOX’s internal controls provisions – passed by a vote of 37 to 32. This amendment was supported by White House Chief of Staff Rahm Emanuel – but as the NY Times reports: “The amendment was criticized by senior Democrats, including Representative Barney Frank of Massachusetts, the chairman of the committee. But at a news conference on Tuesday, Mr. Frank defended Mr. Emanuel’s involvement, saying he had helped to negotiate a substantial narrowing of the provision.”
I didn’t watch the Committee in action, but apparently it was a fluid, fast-moving and confusing situation and I have read a number of conflicting reports on what actually was passed. I’ll post the bill as passed when I get my hands on a copy so you can see how it differs from this discussion draft (here is the Committee’s summary of what passed yesterday).
As I understand it, this Miller amendment was passed, which would impact the independence of the FASB by establishing a federal government forum that would overlooking the FASB’s work. I also hear that this amendment from Congressman Perlmutter will also be offered as an amendment to the upcoming legislation, which would create a new risk regulator structure. I blogged about these actions yesterday as well.
Course Materials Now Available: “4th Annual Proxy Disclosure” and “6th Annual Executive Compensation”
Remember you will need your Conference ID and password to access these. Here is other important Conference information that I blogged about earlier this week.
When Will the SEC Adopt New “Proxy Statement Disclosure Enhancement” Rules?
Yesterday, SEC Chair Mary Schapiro delivered a speech at PLI’s annual Securities Law Institute that summarized the current state of proposals that are Corp-Fin related, including identifying the areas that the SEC’s upcoming concept release on proxy plumbing will address. She indicated that the proxy access proposal would be considered by the Commission in early 2010 (which is not new news, as noted in this blog).
But she did not indicate when the proxy disclosure enhancements proposals would be adopted (a set of proposals that includes the proposed executive compensation rules). At this point, it’s clear that these rules will not be adopted on November 9th – as widely rumored for some time – and it’s unknown when they will be adopted or if they would still apply to the upcoming proxy season even though time is running short to modify D&O questionnaires to capture new information. Corp Fin Director Meredith Cross indicated on a panel that these rules might indeed apply to the 2010 proxy season, but as I understand it, her statement wasn’t definitive so anything can happen. [Don’t forget our upcoming webcast: “Ask the Experts: Prepping for a Wild Proxy Season.”]
And even harder for many companies: timing compensation committee meetings (and other board meetings) to deal with any new rules before the year is out. Numerous members have been emailing me asking if – and when – this is gonna happen…
Survey: Will Your Compensation Committee Hold a Special Meeting if the SEC Adopts New Rules?
Here is an anonymous survey to gather information about what companies are doing to prepare for the possibility of new SEC rules that apply to the upcoming proxy season:
Continuing our proxy solicitor podcast series, in this podcast, Rick Grubaugh of D.F. King & Co. provides some insight into issues related to shareholder proposals seeking to allow shareholders the right to call a special meeting – many companies have received passing votes and are faced with tough choices on how to deal with the demand – including:
– What is background of the proposals that seek companies to allow shareholders to call a special meeting?
– What might we expect for the 2010 proxy season regarding this type of proposal?
– What do institutional shareholders believe is the right threshold of share ownership to call a special meeting?
– What options do companies have if they receive a proposal?
Congress Update: The Battle Over SOX’s Internal Control Requirements Intensifies
This morning, the House Financial Services Committee will be voting on Rep. Frank’s “Investor Protection Act of 2009.” According to this WSJ article, the Committee passed an amendment by voice vote yesterday to exempt smaller companies from Section 404 of Sarbanes-Oxley. Rep. Frank reportedly hopes to beat that back today.
This Huffington Post blog notes that the White House is not doing anything to stop the move to soften Section 404 – and in fact, may be supporting it. This Washington Post article notes the same thing.
Meanwhile, FEI’s “Financial Reporting Blog” notes the latest developments regarding Congressional interest in overhauling the accounting area as there are two competing bills being floated. One would overhaul the FASB by creating a Financial Reporting Forum to oversee its activities.
The other would create a new Federal Accounting Oversight Board to do the same – this new Board would also displace the SEC as the ultimate authority and overseer of accounting standards for public companies (a role that the SEC now delegates to the FASB with its oversight). As reported by the Journal of Accountancy, a joint letter from a group normally at odds with each other argues that the SEC should retain its role.
More on “The Mentor Blog”
We continue to post new items daily on our new blog – “The Mentor Blog” – for TheCorporateCounsel.net members. Members can sign up to get that blog pushed out to them via email whenever there is a new entry by simply inputting their email address on the left side of that blog. Here are some of the latest entries:
– Avoiding Market Misperception of Tax Withholding Transactions
– Survey Results: Use of Enterprise Risk Management (and Disclosure Thereof)
– Analysis: Recent Corp Fin Accounting Comments
– Fifteen Risk Factors for Poor Governance
– How Colleges (and Law Schools) Are Changing
– Test Your Access Now: To ensure you don’t have any technical snafus for the Conferences, please test your access today (this test is only available this week) by using the ID and password that you received for the Conferences.
When you test your access, you can test our CLE Tracker as well as input your bar numbers, etc. You also will be able to input your bar numbers anytime during the days of the Conferences too (remember that you will need to click on the periodic “prompts” all throughout each Conference to earn credit). If you are experiencing problems, follow these webcast troubleshooting tips.
– How to Access the Conference: To access the webcast, use the ID/password that you received in an email from us to get in via a prominent Conference link that will be on the home page of TheCorporateCounsel.net on the day of the Conference; this ID/password is separate and different from any you use for our sites. Note that times posted are in Pacific Time; archives will be available within 24 hours after the live event ends.
– How to Earn CLE Online: Read the “FAQs about Earning CLE” carefully to see if it is possible for you to earn CLE for watching online – and if so, how to accomplish that. Both Conferences will be available for CLE credit in most states (but hours for each state vary; see which state and hours in List: CLE Credits).
– Don’t Share Your ID/Password: We remind you that sharing your ID and password with anyone is stealing from us and a crime.
For those attending in San Francisco:
– Check-In Times: When you come to the San Francisco Hilton – located at 333 O’Farrell Street – you can check in for the Conferences (i.e. pick up your Conference materials, etc.) starting at 7:30 am on Monday, November 9th until the last panel on Tuesday. Continental breakfast is available on Monday from 7:30 to 8:30 am – and on Tuesday from 7:00 to 8:00 am.
– Monday Night Reception: We hope you can join us after the Conference on Monday for our Opening Reception – to be held after the last panel ends – from 6:00 to 8:00 pm. The opening reception will be held in the Exhibit Hall.
You Can Still Attend Via Video Webcast: Due to unprecedented demand and limited space at our conference hotel for the Conferences, we were forced to end Conference Registrations for those attending live in San Francisco. It’s sold out! But note in the alternative, you can still attend by video webcast. You automatically get to attend both Conferences for the price of one: Register now.
As I’ve been covering in this blog over the past week, Congress is moving ahead with its regulatory reform efforts for the markets. Below is a summary of this Sullivan & Cromwell memo:
On October 27, U.S. House Financial Services Committee Chairman Barney Frank released a discussion draft of the Financial Stability Improvement Act of 2009, a legislative proposal for reform of the regulation of the financial services industry. The proposed legislation would, among other things, create a framework for regulation of systemically important financial firms and activities; provide an alternative resolution regime for systemically important financial firms; merge the Office of Thrift Supervision into the Office of the Comptroller of the Currency, retaining the federal thrift charter; reform in several significant respects the regulation of insured depository institutions and their holding companies; and impose certain asset retention requirements on originators and securitizers of asset-backed securities.
More on our “Proxy Season Blog”
With the proxy season now looming in many of our minds, we are posting new items regularly again on our “Proxy Season Blog” for TheCorporateCounsel.net members. Members can sign up to get that blog pushed out to them via email whenever there is a new entry by simply inputting their email address on the left side of that blog. Here are some of the latest entries:
– Europe: Shareholders Increasingly Exercise Votes
– Postseason Review: Withhold Votes
– Analysis: Online Annual Reports
– Reminder: “Independence” Ain’t What it Used to Be!
– Will the Sky Fall if Union Representatives Sit on Boards?
– Time Warner Explains Consultant Selection
Below is an excerpt from this Davis Polkmemo that describes key provisions of two competing over-the-counter derivative bills being considered in the House, comparing their similarities and differences:
Two competing bills to reform the over-the-counter derivatives markets are awaiting action by the House of Representatives: a bill to enact the “Over-the-Counter Derivatives Markets Act of 2009” reported by the Financial Services Committee, chaired by Barney Frank, and a bill to enact the “Derivatives Markets Transparency and Accountability Act of 2009” reported by the Agriculture Committee, chaired by Collin Peterson.
Each of the Frank Bill and the Peterson Bill is based on the proposal released by the Obama Administration on August 11, 2009, and since their earlier releases as discussion drafts, they have moved incrementally closer to each other. The bills share many common features, but several important differences remain to be reconciled. It is expected that Chairman Frank and Chairman Peterson will work to reconcile the differences before a bill moves to the House floor.
And here is an interesting article from Harpers entitled “An Object Lesson in Governmental Failure: Derivatives Reform.”
RiskMetrics Opens Its Policy Comment Period
Last week, RiskMetrics opened its policy comment period, providing an opportunity for a range of industry constituents to provide feedback on updates to its proxy voting policies in markets worldwide. Topics covered include takeover defenses in the U.S.; board and director independence in Japan, the U.S., and Europe; compensation and slate ballots in Canada; and equity and share purchase authorities in Europe. The comment period runs through next Wednesday, November 11th.
Sidenote: On Friday, the SEC’s Inspector General released 536 exhibits related to the SEC’s failure to uncover the Bernie Madoff scandal. That’s a lot of paper. Here’s DealBook’s analysis of what the exhibits say…
Also notable is this recent speech from SEC Commissioner Luis Aguilar entitled “The Power of the Shareholder & the Rise of Corporate Democracy.”
Our November Eminders is Posted!
We have posted the November issue of our complimentary monthly email newsletter. Sign up today to receive it by simply inputting your email address!
On Wednesday, as noted in this MarketWatch article (and this blog too), Rep. Maxine Waters introduced an amendment that was passed by the House Financial Services Committee that would require companies to allow proxy access. The amendment is part of a larger financial reform bill that’s expected to get considered by the full House soon. Of course, the proxy access component of the bill could all die at any time – but it’s notable since its gotten much further than either the Schumer or Peters bill has ever moved.
For those in denial and think that the SEC’s delay of acting on its outstanding proposals killed the move to adopt proxy access, this may serve as a “wake-up” call that access is very much still alive and on the table…
A few days ago, I blogged about a move in the House to exempt smaller companies from SOX’s internal controls requirements. As noted in this Huffington Post blog, one of that amendment’s co-sponsors, Rep. Carolyn Maloney, has backed down and now merely proposes yet another study regarding the impact of Section 404 be done. As noted in the blog, Maloney acknowledges she was not aware of the recent study conducted by the SEC – but she wants the study done anyways. Congress at work…
Schering-Plough Issues Results of Shareholder Survey on Compensation
As Susan Wolf mentioned would happen during her podcast regarding Schering-Plough’s experiment of surveying its shareholders about its pay practices ahead of its annual meeting last year, the company issued a report yesterday regarding the survey responses it received. We have posted a copy of this report in our “Say-on-Pay” Practice Area on CompensationStandards.com.
Note that Pfizer is the second company to go “biennial” by announcing yesterday it will start putting say-on-pay on its ballot next year.
IASB’s Possible Changes to Fair Value Accounting
Last week, IASB’s Chair – Sir David Tweedie – delivered a speech providing an update how fair value accounting might be reformed through changes to IAS 39, “Financial Instruments.” Also read FEI’s “Financial Reporting” Blog to learn how FASB and IASB have committed to “re-tripling” their efforts to meet the 2011 convergence deadline.
From our proxy solicitor podcast series, in this podcast, Reid Pearson of The Altman Group provides some insight into option exchange program issues, including:
– Once a company has decided to bring an option exchange program to shareholders, what are some of the first steps they should consider?
– From a proxy voting perspective, what types of issues will institutional investors and the proxy advisory firms (egs. RiskMetrics, Glass Lewis) be looking at when deciding on their vote or recommendation?
– Is it acceptable for an exchange program to recycle the exchanged shares back into the pool of shares available for future grant?
– What kind of fallout would there be if a company does an exchange of underwater stock options, but does not bring the program to shareholders?
In this USA Today article, SEC Commissioner Elisse Walter’s recent battle with cancer is described nicely.
Survey Results: “Affiliates” for Rule 144 Purposes
We recently wrapped up our Quick Survey on “”Affiliates” for Rule 144 Purposes.” Below are our results:
1. At our company, we define the term “affiliates” for Rule 144 purposes as:
– All Section 16 “persons” – 62.3%
– All Section 16 “officers” – 12.3%
– Selected Section 16 officers and directors – 18.6%
– Selected Section 16 officers – 0.5%
– CEO only – 0.5%
– Other – 5.9%
Please take a moment to respond anonymously to respond to our “Quick Survey on D&O Questionnaires and Related-Party Transactions.”
The “4th Annual Proxy Disclosure Conference”
Due to unprecedented demand and limited space at our conference hotel for the “4th Annual Proxy Disclosure Conference,” we were forced to end Conference Registrations for those attending live in San Francisco. It’s sold out!
You Can Still Attend Via Video Webcast: But note in the alternative, you can still attend the “4th Annual Proxy Disclosure Conference” (11/9) – which is paired with the “6th Annual Executive Compensation Conference” (held on 11/10) – by video webcast. You automatically get to attend both Conferences for the price of one. Here is the agenda for both Conferences. The speakers are a “who’s who” in the executive compensation field, including:
– SEC’s Shelley Parratt
– Disclosure experts Dave Lynn, Mark Borges, Alan Dye and Ron Mueller
– Disclosure experts Keith Higgins, Scott Spector, Howard Dicker, Amy Goodman and Martha Steinman
– Treasury’s Mark Iwry, Senior Advisor to Secretary Geithner
– RiskMetrics’ Pat McGurn and Valerie Ho
– Glass Lewis’ Bob McCormick
– NY Times’ columnist Joe Nocera
– Noted counsel John Olson and Marc Trevino
– Renowned consultants Fred Cook, Ira Kay, Mike Kesner, Doug Friske, James Kim and Don Delves
– Chevron director Bob Denham and P&G Chair A.G. Lafley
– Investor advocates Meredith Miller and Paul Hodgson
– Our own Jesse Brill and Broc Romanek
Order Audio from NASPP Conference: In addition, you can still hear each – and any – of the 36 panels you wish from the NASPP Conference by ordering the downloadable audio and course materials.
Yesterday, Corp Fin issued Staff Legal Bulletin No. 14E, which changes how the Rule 14a-8(i)(7) exclusion for ordinary business operations applies so that proposals relating to CEO succession planning generally are no longer excludable (“generally” because proposals that seek to micro-manage will still be excludable; we’ll have to see how “micro-manage” is interpreted by the Staff) – and that risk-related proposals will be analyzed under a new framework.
The SLB lays out this risk-related framework as: “rather than focusing on whether a proposal and supporting statement relate to the company engaging in an evaluation of risk, we will instead focus on the subject matter to which the risk pertains or that gives rise to the risk.” The SLB also reminds companies and proponents how to notify the Staff when they intend to submit correspondence in connection with a no-action request.
Unlike last year’s Staff Legal Bulletin regarding 14a-8, this one is bound to cause a stir because it essentially reverses two prior Staff decisions – with the likely result of more proposals being included in proxies during the upcoming proxy season.
In his blog, Sanford Lewis describes the changed positions as a victory for shareholders and gives some background about the press for these changes, including the shareholder proposal meeting with the Corp Fin Staff held last month. And the RiskMetrics’ “Risk & Governance” Blog includes quotes from a number of activists hailing the SEC’s actions, it also describes how these two Staff positions have evolved over time.
Posted: 2010 Compensation Disclosure Treatise
Dave Lynn, Mark Borges & I just finished the new ’10 version of Lynn, Borges & Romanek’s “Executive Compensation Disclosure Treatise and Reporting Guide” – it is now posted on CompensationDisclosure.com and the hard copy is at the printers (delivery expected in mid-November). To obtain both the online and hard copy versions of this Treatise, you need to try a no-risk trial to the Lynn, Borges & Romanek’s “Executive Compensation Service” now.
Without access to this New Treatise – as well as the “Proxy Disclosure Updates” quarterly newsletters that you will get if you renew as a Service subscriber – you will miss our critical guidance that you need to prepare your proxy disclosures during this upcoming proxy season including this:
Proxy Disclosure Updates – Full Walkaway Model CD&A: Dave is putting the final touches on a key, new model CD&A disclosure which will need to be addressed in this year’s proxy statements. The upcoming Fall issue of “Proxy Disclosure Updates” will focus on this important new full walkaway disclosure, providing not only new model disclosure, but also invaluable guidance on what to cover and why and how. To receive this model disclosure as soon as it’s out, you need to try a no-risk trial now.
Carving Up the “Investor Protection Act”: The Political Process at Work on SOX’s Internal Controls
Last week, I polled members as to whether they thought the SEC’s 6th – and deemed “final” – delay in having smaller companies provide auditor attestations would really stick. The poll results were:
– 50% said SEC would not further delay the deadline
– 22% said the SEC would further delay it without being forced to
– 12% said Congress would force the SEC to delay it
– 16% said “what me worry?”
Looks like there is a chance that 12% knew what they were talking about. Yesterday, the Huffington Post reported in this blog that Reps. John Adler (D-NJ) and Carolyn Maloney (D-NY) planned to introduce amendments to the Investor Protection Act that would permanently exempt companies with market capitalizations of less than $75 million from Section 404 of Sarbanes-Oxley and further delay that Section’s application to companies with a market cap of less than $700 million. Here is Rep. Adler’s related press release.
I have a copy of Rep. Adler’s “Dear Colleague” letter as well as an opposition letter from the Consumer Federation of America, which combined provide more details than the Huffington Post blog – if you want them, email me…
