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NYSE Proposes to Amend Exclusions from Equity Compensation Rules to Mirror Practice

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The New York Stock Exchange proposes to amend Section 303A.08 of the Manual to clarify the circumstances under which certain sales of a listed company’s securities will not be deemed to be equity compensation for purposes of that rule. The rule proposal states as follows: Section 303A.08 provides that an... Read More

Topics: Employment, Executive Compensation, Public Companies and Securities

Does a Requirement to Pay “Target Variable Compensation” Include Equity Awards?

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In Batty v. UCAR International Inc. et al the Delaware Court of Chancery considered the terms of a severance agreement.  The agreement, which was entered into in 2000, set the compensation that plaintiff Batty, who was employed by certain of the defendants for 34 years, would receive from the defendants... Read More

Topics: Employment, Executive Compensation, Litigation, M&A, Public Companies and Securities

Revising 162(m) Disclosures in Proxy Statements

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The Section 162(m) deduction limit for performance-based compensation was repealed by the Tax Cut and Jobs Act, effective for taxable years beginning after December 31, 2017, subject to transition relief. Public companies should consider revising disclosures in their upcoming proxy statements. Recently filed proxy statements may provide some ideas, a... Read More

Topics: Employment, Executive Compensation, Public Companies and Securities

ISS Publishes Preliminary 2019 Compensation FAQs

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ISS has published preliminary frequently asked questions related to compensation policies for 2019. Some key observations are noted below. Will any of the quantitative pay-for-performance screens change for 2019? No. There will be no changes to the quantitative screens for the 2019 proxy season. The secondary Financial Performance Assessment screen... Read More

Topics: Employment, Executive Compensation, Public Companies and Securities

Court Declines to Approve Settlement in Director Pay Suit

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In Stein v. Blankfein et al the Delaware Court of Chancery considered a proposed settlement of litigation against directors of Goldman Sachs. The related complaint contained two counts for derivative relief for breach of fiduciary duties related to the payment of excessive compensation awards to non-employee directors and issuing stock-based... Read More

Topics: Employment, Executive Compensation, Litigation, Public Companies and Securities

#MeToo Clauses Being Added to Merger Agreements

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Some merger agreements are starting to include representations and warranties regarding the absence of allegations of sexual harassment against senior officials. Some examples follow. Brookfield Asset Management’s acquisition of Forest City Realty To the Knowledge of the Company, in the last five (5) years, no allegations of sexual harassment have... Read More

Topics: Employment, M&A, Public Companies and Securities

SEC Targets Perqs in Another Enforcement Action

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The SEC has targeted disclosure of executive perquisites in another settled enforcement action.  According to the SEC, the issuer did not follow the Commission’s standard regarding disclosure of perquisites, which provides that: An item is not a perquisite or personal benefit if it is integrally and directly related to the... Read More

Topics: Employment, Executive Compensation, Litigation, Public Companies and Securities

SEC Issues FAQs on Compensation Plan Proposals Included in Proxy Statements

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The SEC has issued a series of frequently asked questions, which in SEC speak are referred to as Compliance and Disclosures Interpretations (or C&DIs for short), on proxy statements and proxy solicitations.  In general the C&DIs replace previously issued telephone interpretations, but the lead in notes where substantive changes have been... Read More

Topics: Employment, Executive Compensation, Public Companies and Securities