Implementing the SEC's New Executive Compensation Disclosures: What You Need to Do Now!
Two-Day Detailed Agenda & Schedule
(Times are Eastern - but all panels will be archived and available at your discretion)
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For Washington DC Attendees, below are times you can check in at the Marriott:
- - Sunday, September 10th from 5:00 pm - 7 pm
- - Monday, September 11th from 7:30 am - 5:00 pm (Continental Breakfast from 7:30 - 9:00 am; Reception 5:00 - 6:00 pm)
- - Tuesday, September 12th from 8:00 am - 3:00 pm (Continental Breakfast from 7:30 - 9:00 am)
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For Webcast Attendees, below are directions on how to test your ability to watch the Conference:
If you are attending online, just log in to TheCorporateCounsel.net or CompensationStandards.com on the days of the Conference (or afterwards) to watch it live or by archive.
Here's what you'll need to watch the video (or listen to audio only):
- To watch by video webcast, you will need at least a 56 kbps connection to the Internet; however, 100 kbps is preferable. For audio only, you will need at least a 28.8 kbps connection to the Internet.
- You will need one of the following two "players" to access the video webcast: click here to check whether you already have the Windows Media Player or RealPlayer, which also allows you to determine whether you have the proper connectivity or any potential firewall issues.
- If you don't have one of the players, you need the free Windows Media Player (download here) or the free RealPlayer (download here). Please note that after downloading the software, you must install it. Simply downloading the software will not allow access to the archive. Downloading and/or installing the software may require permission from your network administrator.
- If you are still unable to access the archive, contact your IT department.
Note that course materials will not be available until the first day of the Conference. They will be handed out in DC and posted online, adjacent to the links you will use to access the video/audio.
We also gently remind you that only persons registered to attend are entitled to use an ID and password to access the Conference. In other words, it is illegal to share your ID and password with anyone else inside (or outside) your office - as well as a violation of the
terms & conditions of attending the Conference. If you share your ID and password with someone that is not registered - you not only will lose access to the Conference, you also will not be entitled to a refund. If you feel the urge to share, you should upgrade your license now to accommodate more people - our HQ will apply any money you already spent on a license towards a larger one.
Unfortunately, we will be monitoring for this illegal activity. You might recall that a few years back, Legg Mason was hit with a
$20 million dollar judgment because its employees were sharing IDs/passwords for an online service.
Day 1: Monday, September 11, 2006
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Learning the Basics
- The New CD&A – why directors and drafters need to be concerned
- How does the CD&A differ from the Compensation Committee Report
- Who should draft the CD&A and how should it be reviewed (and when)
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The "Analysis" and Actions: The Big Sleeper
- How the SEC Staff believes the "A" in "CD&A" is a monumental change – and what actions boards need to take now
- How to address your compensation philosophy, practices and policies
- How to address each element of compensation
- How to address the determination of award amounts
- How to tie each element of pay to your compensation philosophy and objectives
- How to describe the bases of each NEO's compensation
- How to describe performance-based compensation
- How to describe specific performance measures
- How to determine when information is "confidential"
- What should be said about process and procedures
- What needs to be addressed regarding tally sheets, internal pay equity, wealth accumulation analysis and other "hot button" compensation practices
- What is the relationship between CD&A and MD&A
- Essential Practice Tips You Oughta Know
- How to determine who is an NEO under the new rules
- The tough items: what to do with departing NEOs; how to tell if an officer becomes an NEO in middle of a year; what to do with large, non-recurring items
- Essential Practice Tips You Oughta Know
- How the Summary Compensation Table has changed
- What to include – and not include – in the new "total compensation" column, including how tally sheets tie into the column
- How to calculate the amounts of stock-based awards, including analysis of FAS 123(R) valuation methodologies
- What footnotes are now necessary to supplement the table
- How to draft narrative that ties to your new Summary Compensation Table
- Tips on how to transition your old SCT to your new SCT
- Essential Practice Tips You Oughta Know
- What to include in the new tables
- How to overcome the challenges in calculating amounts now required to be disclosed, including earnings on plan balances
- How to draft the narrative disclosure, including how to describe your assumptions and how to minimize "double counting" risks
- The need to address open-ended formula provisions and the presence or absence of caps
- Essential Practice Tips You Oughta Know
- What to include in these tables
- How to disclose the pertinent details about option granting practices
- How to determine if an award is subject to a "performance or market condition"
- How to include material modifications of awards, including repricings
- How to deal with outstanding pledges and hedging positions by directors and NEOs
- Essential Practice Tips You Oughta Know
- How to determine what is a "perk"
- How to deal with the challenging issues of airplane travel
- How to deal with other modes of travel
- How to deal with security-related items
- How to deal with other perquisites
- What valuation methodologies you should use
- How to disclose perks
- Essential Practice Tips You Oughta Know
Day 2: Tuesday, September 12, 2006
- What new disclosures are now required and how to integrate these disclosures with other SEC filings
- How to overcome the challenges in calculating amounts now required to be disclosed
- The need to address wealth accumulation numbers and/or caps
- The tough items: perquisites, welfare benefits, tax gross-ups, caps vs. open-ended and more
- Essential Practice Tips You Oughta Know
- How to prepare the new director compensation table
- How to tie narrative disclosures to the new table
- The tough items: perquisites, hold-til-retirement, related-party transactions and more
- Essential Practice Tips You Oughta Know
- What new disclosures are now required
- What you need to do now with your committee charters, governance guidelines and checklists
- How to describe the role of the compensation consultant (plus lawyers and other advisors), including how to describe multiple engagements with a particular consultant
- Essential Practice Tips You Oughta Know
- What new disclosures are now required, including the interplay of NYSE and Nasdaq requirements
- What you need to do now with your data collection processes, including D&O and independence questionnaires
- The tough items: how to uncover hidden information, "what now" when you uncover a director tie, how to handle new directors, and more
- Essential Practice Tips You Oughta Know
- What new disclosures are now required, including new disclosure of approval procedures and policies
- How to analyze business transactions, including reliance on safe harbors and calculation of amounts
- How to deal with indebtedness, including calculation of amounts
- How to analyze family ties
- How to revise your D&O questionnaire
- What changes to other procedures and policies are now necessary
- Essential Practice Tips You Oughta Know
What you need to tell directors NOW about their new roles, including:
- The compensation setting and review process
- Getting up-to-speed on tally sheets, internal pay equity and wealth accumulation analyses
- Preparing – and reviewing – the new CD&A, the tables, and the expanded narrative in the compensation section of the proxy statement
- Who should be on the disclosure committee for compensation disclosures
- Who should lead which stage of the process
- What the reporting chain should look like (eg. relationship between HR and the compensation committee)
- What data should be collected - and by whom, including how disclosure controls and procedures now relate to internal controls in this area
- What you need to do now with your D&O questionnaires
- What other processes now need to change (and why), including coordination between the compensation and disclosure committees
- What is the interplay between CEO/CFO certifications and subcertifications with the new rules
- How might processes for smaller companies differ
- Examples of what companies have done so far and what you can do
- Essential Practice Tips You Oughta Know
- How the new rules differ from the old rules, including new disclosure requirements
- What arrangements need to be disclosed for new officers
- What arrangements need to be disclosed for continuing officers
- What arrangements need to be disclosed for directors
- "Materiality" and other tough items: how to deal with salary increases, discretionary bonuses, formulas, perquisites, creation and filing of exhibits, and more
- What you need to do now with your data collection processes, including changes to your disclosure committee
- Essential Practice Tips You Oughta Know
- What types of documentation you now need to avoid liability (and keep your job)
- What areas need documentation that perhaps weren't necessary before
- What areas is the SEC Enforcement Division likely to focus on
- What areas is the plaintiff's bar likely to focus on
- Essential Practice Tips You Oughta Know
