Client Alert
Treasury Issues New EESA Executive Compensation Guidance
October 23, 2008
Because of the rapidly changing conditions in the financial markets, we have established this special series of Client Alerts to advise you of the newest economic and legal developments and their wide-ranging business implications.
Since last week, the Treasury Department has issued four sets of guidance regarding new executive compensation restrictions imposed under the Emergency Economic Stabilization Act of 2008 ("EESA"), the legislation quickly enacted earlier this month in order to provide liquidity to troubled financial markets. The restrictions technically only apply to financial institutions participating in one of the EESA programs. However, they can be expected to have at least some degree of "best practices" impact on compensation design and disclosure at many companies – as reinforced by comments made this week by a senior SEC Staff official, who suggested that public companies should be considering whether recent economic and financial events affect their compensation programs, particularly regarding the risks encouraged by compensation design, and adjusting their compensation disclosures accordingly.
Click here to read our client alert regarding the recent Treasury guidance.
Contact Information
If you have any questions regarding the recent Treasury guidance, please contact the Womble Carlyle attorney with whom you usually work or one of our Corporate and Securities attorneys or Employee Benefits attorneys.
Womble Carlyle client alerts are intended to provide general information about significant legal developments and should not be construed as legal advice on any specific facts and circumstances, nor should they be construed as advertisements for legal services.
IRS CIRCULAR 230 NOTICE: To ensure compliance with requirements imposed by the IRS, we inform you that any U.S. tax advice within this client alert is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter addressed in a client alert.
