How to Reduce Plaintiff Attorneys' Income Taxes and Build Wealth Using Contin...Greg Maxwell
This presentation was created by Greg Maxwell, Esq., CFP® of Amicus Settlement Planners. If you have any questions about deferring legal fees, you may schedule a complimentary call with Greg via this link: bit.ly/book-a-call-with-greg-maxwell, or you can email Greg at Contact@AmicusPlanners.com.
How to Reduce Plaintiff Attorneys' Income Taxes and Build Wealth Using Contin...Greg Maxwell
This presentation was created by Greg Maxwell, Esq., CFP® of Amicus Settlement Planners. If you have any questions about deferring legal fees, you may schedule a complimentary call with Greg via this link: bit.ly/book-a-call-with-greg-maxwell, or you can email Greg at Contact@AmicusPlanners.com.
Executive Compensation Checklist for New and Experienced Board Members (Credi...NAFCU Services Corporation
Looking for an Executive Compensation Checklist for your Credit Union? This presentation serves as a valuable tool for new and experienced board members in pinning down the latest information on new regulations and compensation philosophies associated with creating a successful executive compensation plan. For more info, visit: www.nafcu.org/bfb
"Non-Qualified Deferred Compensation Plans" was presented by Tom Sigmund on December 18, 2014, at the CPA Mega Tax Conference.
Tom discussed the details of non-qualified deferred compensation plans, including social security taxes, informal funding and penalties.
Five Common Questions About Deferred CompensationCBIZ, Inc.
Is a deferred compensation plan right for you? Here are five common questions about deferred comp.
Corporate deferred compensation plans for highly compensated employees are a planning tool that companies and key executives should explore. They are attractive because of the significant increase in ordinary income tax rates on compensation. Such plans are also a fringe benefit that can attract and retain key executives.
Defined contribution (DC) plan sponsors face increasingly complex issues. Russell Investments has developed a priority list of eight ideas and actions to help plan sponsors guide their participants toward better decision-making as they save for retirement.
Retirement Presentation For Small Businessguest4a21e5
Prepare for your future today with the right type of tax advantage savings plans. offer your employees the benefit of a retirement plan. Learn from this presentation what you can do today to make a bettewr tomorrow.
HunterMaclean ERISA and employee benefits attorney Rebecca Sczepanski made this presentation at the 2015 Savannah Fiduciary Seminar. Her presentation covered a summary of the legal issues regarding fiduciary status, including how to identify ERISA and state law fiduciaries. She provided tips for avoiding or mitigating risks associated with defined plan fiduciary status as well as an update on major fiduciary litigation.
Randall Webb - TJSDD - Common Pitfalls and Deficiencies Found in Plan AuditsDowney Brand LLP
At the 2015 Savannah Fiduciary Seminar, Randall Webb of TJS Deemer Dana presented the most common deficiencies identified during plan audits and how plan sponsors should correct those deficiencies going forward.
Apple Executive Compensation Policy WITH VIDEOExkalibur.com
Apple's Executive Compensation Policy incorporates 5 Cornerstones of Executive Compensation that represent a set of proven concepts that can be effectively applied to your business. I've also created a video describing Apple's plan (it appears on the first slide) which explains some of these concepts.
Check it out and let me know what we might be missing at http://www.Exkalibur.com.
Ensuring your top financial executives’ compensation package is competitive is a critical component of any successful compensation program. Learn how to attract and retain top talent across all organizations.
Executive Compensation Checklist for New and Experienced Board Members (Credi...NAFCU Services Corporation
Looking for an Executive Compensation Checklist for your Credit Union? This presentation serves as a valuable tool for new and experienced board members in pinning down the latest information on new regulations and compensation philosophies associated with creating a successful executive compensation plan. For more info, visit: www.nafcu.org/bfb
"Non-Qualified Deferred Compensation Plans" was presented by Tom Sigmund on December 18, 2014, at the CPA Mega Tax Conference.
Tom discussed the details of non-qualified deferred compensation plans, including social security taxes, informal funding and penalties.
Five Common Questions About Deferred CompensationCBIZ, Inc.
Is a deferred compensation plan right for you? Here are five common questions about deferred comp.
Corporate deferred compensation plans for highly compensated employees are a planning tool that companies and key executives should explore. They are attractive because of the significant increase in ordinary income tax rates on compensation. Such plans are also a fringe benefit that can attract and retain key executives.
Defined contribution (DC) plan sponsors face increasingly complex issues. Russell Investments has developed a priority list of eight ideas and actions to help plan sponsors guide their participants toward better decision-making as they save for retirement.
Retirement Presentation For Small Businessguest4a21e5
Prepare for your future today with the right type of tax advantage savings plans. offer your employees the benefit of a retirement plan. Learn from this presentation what you can do today to make a bettewr tomorrow.
HunterMaclean ERISA and employee benefits attorney Rebecca Sczepanski made this presentation at the 2015 Savannah Fiduciary Seminar. Her presentation covered a summary of the legal issues regarding fiduciary status, including how to identify ERISA and state law fiduciaries. She provided tips for avoiding or mitigating risks associated with defined plan fiduciary status as well as an update on major fiduciary litigation.
Randall Webb - TJSDD - Common Pitfalls and Deficiencies Found in Plan AuditsDowney Brand LLP
At the 2015 Savannah Fiduciary Seminar, Randall Webb of TJS Deemer Dana presented the most common deficiencies identified during plan audits and how plan sponsors should correct those deficiencies going forward.
Apple Executive Compensation Policy WITH VIDEOExkalibur.com
Apple's Executive Compensation Policy incorporates 5 Cornerstones of Executive Compensation that represent a set of proven concepts that can be effectively applied to your business. I've also created a video describing Apple's plan (it appears on the first slide) which explains some of these concepts.
Check it out and let me know what we might be missing at http://www.Exkalibur.com.
Ensuring your top financial executives’ compensation package is competitive is a critical component of any successful compensation program. Learn how to attract and retain top talent across all organizations.
A company offer a competitive compensation arrangement in order to attract, retain, and motivate a qualified CEO to manage the organization.
This Quick Guide examines the elements of executive compensation and the process by which the compensation committee establishes pay packages.
It examines the questions:
• What is the purpose of a compensation program?
• How do boards structure pay?
• What is the difference between expected, earned, and realized pay?
• How much do CEOs make?
• Are CEOs paid the “right” amount?
For an expanded discussion, see Corporate Governance Matters: A Closer Look at Organizational Choices and Their Consequences (Second Edition) by David Larcker and Brian Tayan (2015): http://www.gsb.stanford.edu/faculty-research/books/corporate-governance-matters-closer-look-organizational-choices
Buy This Book: http://www.ftpress.com/store/corporate-governance-matters-a-closer-look-at-organizational-9780134031569
For permissions to use this material, please contact: E: corpgovernance@gsb.stanford.edu
Copyright 2015 by David F. Larcker and Brian Tayan. All rights reserved.
A presentation from a November 2011 webinar hosted by compensation and law experts from INTEGRATED Healthcare Strategies and Eptein Becker Green.
See more at: http://www.integratedhealthcarestrategies.com/knowledgecenter.aspx
Take this opportunity to learn about identifying and comparing to your competitors, building commitment and employee engagement and developing a total strategy that supports your organization’s mission and strategic plan.
Our webinar is structured to provide not only education but also useful strategies for addressing the many pressures on executive compensation, wages and salaries. Nonprofits are being scrutinized by the IRS, and executive compensation is a staple of all audits. Nonprofit managers and trustees must prepare for public, media, Form 990, IRS and State scrutiny. Wage and salary programs face a difficult economy as they struggle to attract and retain the best talent with scarce dollars.
Executive Compensation: Life Sciences & HealthCare 2013 CompStudy InsightsWilmerHale
Executive Compensation: Insights from the 2013 CompStudy Survey, Life Sciences & Healthcare Edition
Explores the CompStudy as well as:
- Current Founder’s Dilemmas research
- 2013 survey – company profiles
- Summary compensation data
- CEO compensation review
- Hot topics and current trends
This is a unique new survey (launched back in 2005) run by a team of professionals that all have solid C&B Corporate experiences. The survey is specifically designed to cover Senior Executive Management Compensation having Area, Regional, Headquarter or Corporate responsibilities based in Europe.
Dodd-Frank Wall Street Reform and Consumer Protection Act, Executive Compensa...Edward Hauder
This presentation looks at the executive compensation provisions (Sections 951-957) and corporate governance provisions (Sections 971-972) of the Dodd-Frank Wall Street Reform and Consumer Protection Act.
409A Guidance on Nonqualified Deferred Compensation Plans: Compliance Strateg...Petra Pasternak
Fenwick attorneys Marshall Mort and Hans Andersson discuss compliance strategies for nonqualified deferred compensation plans as well as implications of tax reform, definition of payment, exemptions, permitted payments, remedies and more.
Business Law & Order - September 16, 2013 - What you don't know can cost you ...AnnArborSPARK
Compensating employees with equity compensation is not uncommon, particularly with start-up companies. Unfortunately, what also is not uncommon are unforeseen consequences detrimental to the business or employee when equity plans are poorly structured. Our panel of experienced attorneys will discuss a myriad of equity related issues, including: positive and negative aspects of stock options (ISOs or NQOs?); founders stock, restricted stock and 83(b) elections, as well as common pitfalls, including fair market value, change in control and permissible payment dates under Code Section 409A; which employees are given equity; what equity grant vesting and buyback restrictions are typical and why, and what impact does equity compensation have on mergers and IPOs?
Moderator:
Melvin J. Muskovitz
Dykema Gossett PLLC
Panelists:
Charles M. Russman
Bodman PLC
Margaret Hunter
Dykema Gossett PLLC
SEC Adopts Enhanced Compensation and Corporate Governance Proxy Disclosure Rules for 2010 Proxy Season
A Practical Approach to What Companies, Boards and Compensation Committees Need to Do Now
This presentation about Sri Lanka accounting standards 19, employee benefits. most of the areas are discuss on this. objectives,short term,post,long term, termination. employee benifits.
Presentation delivered by Camille Evans, International Tax Director, Eastman Chemical Company and Tasheaya Warren Ellison, Senior Tax Attorney – Tax Dispute Resolution, Shell Oil Company at the marcus evans Tax Officers Summit 2016 in FL.
Dodd-Frank Executive Compensation Update – Rounding the Final Turn? Winston & Strawn LLP
As the fifth birthday of the Dodd-Frank Act fades into history, we are still awaiting rules from four of its main executive compensation provisions to be finalized. Proposed rules have been issued for all four (clawbacks, pay ratio, hedging, and pay for performance), and final rules are rumored for at least one in the very near future. Meanwhile, congressional pressure increases for the SEC to issue its final rules.
Winston & Strawn partners Scott Landau and Erik Lundgren from our executive compensation and employee benefits practice gave a practical, interactive presentation that reviewed the status of each of the “Last Four” requirements, compliance challenges facing companies, and strategies and action items for addressing the requirements and their uncertain timing.
Eight Key Questions for IRC § 409A Compliance -
The Gatekeeper to Structuring Effective Deferred Compensation Arrangements
Internal Revenue Code § 409A ("§409A") establishes several critical hurdles to tax deferrals by imposing a complex series of requirements governing plan documentation, the timing and content of elections to defer compensation, and the form and timing of the actual payment of deferred compensation. Failure to meet these requirements subjects the individual deferring the compensation to substantial additional tax penalties.
Qualified Retirement Plans: Surviving the Ever-Changing Regulatory EnvironmentQuarles & Brady
Please join us via webinar to gain practical knowledge directly applicable to your daily employee benefits responsibilities from a panel with over 100+ years of combined experience in the "trenches." Through their extensive plan administration, legal, compliance, regulatory and investigations experience, you will hear about the new regulatory changes effective in 2019 along with perspectives on avoiding and surviving uninvited visits from the Internal Revenue Service and the Department of Labor. Actual scenarios will be used to illuminate what worked well or not so well. You will also learn how to assess when and where it makes good business sense to approach the government to formally ask for absolution and when reasonable remedial action, consistent with standards of fairness and cost-efficiency, is sufficient and appropriate.
US/ Canada cross-border tax planning could be impacted by the recent finalization of Section 385 regulations by the IRS and Treasury Department. Because most of these new rules apply with an effective date reaching back to April 5, 2016, it is imperative that Canadian companies with U.S. activities assess their potential impact and develop a strategy for managing their exposure to these rules.
This presentation provides an update on both recently issued and forthcoming pronouncements of the Financial Accounting Standards Board (FASB). Through this presentation, you should be able to identify what changes are effective for your 2015 financial statements, including changes you may choose to early adopt.
1). The "Clawback" of erroneously awarded executive compensation and section 409A
2). Some administration tax proposals from the 2017 budget
3). Latest rating agencies' reports on life insurance industry
4). Failure to properly withhold non-qualifies plan FICA taxes - cases settled in favor of participants
5). Section 409A failure in retention agreement results in taxable income
Rethinking Executive Compensation While Awaiting Section 162(m) GuidanceFulcrum Partners LLC
This whitepaper report has been prepared by: Bruce Brownell, CFP, Founder and Managing Director Fulcrum Partners; G. Scott Cahill, CLU, Founder and Managing Director Fulcrum Partners; Joan Vines, Managing Director, National Tax - Compensation and Benefits, BDO; Carl Toppin, Managing Director Compensation and Benefits, BDO; Andrew Gibson, Regional Managing Partner - Tax Services BDO; and Peter Klinger, Partner, Compensation & Benefits, BDO.
Rollovers: the impact it can have on your retirementAndrew Leeman
While leaving your money in your former employer's plan may be an option, one way to gain more control of your assets is to consolidate your retirement funds into a single individual retirement account (IRA). Email me with any questions: aleeman@ft.newyorklife.com
Similar to Executive Compensation - Some Developments and Reminders (20)
2016 Year in Review: Recent Midwest Legal Decisions Impacting Real Estate and...Quarles & Brady
In 2016, the Midwest (which we will define as Illinois, Indiana, Iowa, Michigan, Minnesota, Missouri, Ohio, and Wisconsin) saw a number of statutory changes and court decisions that reshaped and framed a number of key issues every developer, design professional, owner, lender, contractor, and real estate and construction lawyer must know.
Key Bankruptcy Considerations Heading into a RecessionQuarles & Brady
As the impact of the COVID-19 pandemic continues to evolve, US businesses are already feeling the impact of a potential economic downturn. Presenters will discuss key considerations that may present themselves in the event of a recession, including modification and forbearance agreements, amendment/default scenarios, risks regarding "slow pay" and termination of key contracts, and priority rights of suppliers in bankruptcy, as well as implications of the Small Business Bankruptcy Act for potential debtors.
Action Steps for Your Employee Benefits Plan During the Coronavirus PandemicQuarles & Brady
With the enactment of two new Coronavirus-related laws, plan sponsors of retirement, health and welfare plans have several "must-do" items to consider, along with several "optional" items. Join us for this informative webinar where we will discuss the different legal considerations plan sponsors and service providers (such as third party administrators, insurance brokers and pharmacy benefit mangers) should consider for their retirement, health and welfare plans.
We will discuss:
-What coronavirus testing must be covered by health plans
Important changes to "over the counter" drugs and medicine
-Addressing layoffs and furloughs, and how to survive the benefit costs
-Best practices for distribution and loan options for those who have been affected
-Delaying, repaying and fixing 2020 required minimum distributions
-How to treat paid leave under your retirement plans
Guidance for Employers During the Evolving COVID-19 PandemicQuarles & Brady
As the impact of the COVID-19 pandemic continues to rapidly evolve, U.S. employers are wrestling with many workforce issues to ensure workforce safety and mitigate operational disruptions. Our discussion will present key considerations for employers relating to employee workplace safety, implementing policies and procedures for working remotely, handling issues of paid and unpaid leave for employees or family member care, as well as addressing travel restrictions, all within the context of FMLA, EEOC, wage and hour and other legal guidelines. A question and answer period will follow the presentation.
Guidance for Employers During the Evolving COVID-19 PandemicQuarles & Brady
As the impact of the COVID-19 pandemic continues to rapidly evolve, U.S. employers are wrestling with many workforce issues to ensure workforce safety and mitigate operational disruptions. Our discussion will present key considerations for employers relating to employee workplace safety, implementing policies and procedures for working remotely, handling issues of paid and unpaid leave for employees or family member care, as well as addressing travel restrictions, all within the context of FMLA, EEOC, wage and hour and other legal guidelines. A question and answer period will follow the presentation.
Business Law Training: Market Turmoil in D&O Insurance and Is Your Company Pr...Quarles & Brady
This lively discussion focused on the market turmoil in the current public and private D&O markets. Additionally, the professionals explained the scope of Cyber Insurance for tradition exposures, operational risk and regulatory compliance.
Understand the SECURE Act, the Repeal of the “Cadillac Tax” and Other Health ...Quarles & Brady
After stalling in the Senate for much of 2019, the long expected passage of the SECURE Act became a reality through a quiet attachment to the approved year-end spending bill. This session covered the Act's impact on important aspects of your benefit plans, along with the repeal of the so-called "Cadillac Tax" and other benefit changes included in the spending bill. Attendees were able to gain the information needed to comply with this newly passed legislation and ways to adapt their benefits to take full advantage of the law. We presented the formal legal changes as well as our perspectives on what compliance means on a practical level. Time for Q&A was planned near the end of the session.
Military Commissions details LtCol Thomas Jasper as Detailed Defense CounselThomas (Tom) Jasper
Military Commissions Trial Judiciary, Guantanamo Bay, Cuba. Notice of the Chief Defense Counsel's detailing of LtCol Thomas F. Jasper, Jr. USMC, as Detailed Defense Counsel for Abd Al Hadi Al-Iraqi on 6 August 2014 in the case of United States v. Hadi al Iraqi (10026)
Responsibilities of the office bearers while registering multi-state cooperat...Finlaw Consultancy Pvt Ltd
Introduction-
The process of register multi-state cooperative society in India is governed by the Multi-State Co-operative Societies Act, 2002. This process requires the office bearers to undertake several crucial responsibilities to ensure compliance with legal and regulatory frameworks. The key office bearers typically include the President, Secretary, and Treasurer, along with other elected members of the managing committee. Their responsibilities encompass administrative, legal, and financial duties essential for the successful registration and operation of the society.
WINDING UP of COMPANY, Modes of DissolutionKHURRAMWALI
Winding up, also known as liquidation, refers to the legal and financial process of dissolving a company. It involves ceasing operations, selling assets, settling debts, and ultimately removing the company from the official business registry.
Here's a breakdown of the key aspects of winding up:
Reasons for Winding Up:
Insolvency: This is the most common reason, where the company cannot pay its debts. Creditors may initiate a compulsory winding up to recover their dues.
Voluntary Closure: The owners may decide to close the company due to reasons like reaching business goals, facing losses, or merging with another company.
Deadlock: If shareholders or directors cannot agree on how to run the company, a court may order a winding up.
Types of Winding Up:
Voluntary Winding Up: This is initiated by the company's shareholders through a resolution passed by a majority vote. There are two main types:
Members' Voluntary Winding Up: The company is solvent (has enough assets to pay off its debts) and shareholders will receive any remaining assets after debts are settled.
Creditors' Voluntary Winding Up: The company is insolvent and creditors will be prioritized in receiving payment from the sale of assets.
Compulsory Winding Up: This is initiated by a court order, typically at the request of creditors, government agencies, or even by the company itself if it's insolvent.
Process of Winding Up:
Appointment of Liquidator: A qualified professional is appointed to oversee the winding-up process. They are responsible for selling assets, paying off debts, and distributing any remaining funds.
Cease Trading: The company stops its regular business operations.
Notification of Creditors: Creditors are informed about the winding up and invited to submit their claims.
Sale of Assets: The company's assets are sold to generate cash to pay off creditors.
Payment of Debts: Creditors are paid according to a set order of priority, with secured creditors receiving payment before unsecured creditors.
Distribution to Shareholders: If there are any remaining funds after all debts are settled, they are distributed to shareholders according to their ownership stake.
Dissolution: Once all claims are settled and distributions made, the company is officially dissolved and removed from the business register.
Impact of Winding Up:
Employees: Employees will likely lose their jobs during the winding-up process.
Creditors: Creditors may not recover their debts in full, especially if the company is insolvent.
Shareholders: Shareholders may not receive any payout if the company's debts exceed its assets.
Winding up is a complex legal and financial process that can have significant consequences for all parties involved. It's important to seek professional legal and financial advice when considering winding up a company.
ALL EYES ON RAFAH BUT WHY Explain more.pdf46adnanshahzad
All eyes on Rafah: But why?. The Rafah border crossing, a crucial point between Egypt and the Gaza Strip, often finds itself at the center of global attention. As we explore the significance of Rafah, we’ll uncover why all eyes are on Rafah and the complexities surrounding this pivotal region.
INTRODUCTION
What makes Rafah so significant that it captures global attention? The phrase ‘All eyes are on Rafah’ resonates not just with those in the region but with people worldwide who recognize its strategic, humanitarian, and political importance. In this guide, we will delve into the factors that make Rafah a focal point for international interest, examining its historical context, humanitarian challenges, and political dimensions.
Car Accident Injury Do I Have a Case....Knowyourright
Every year, thousands of Minnesotans are injured in car accidents. These injuries can be severe – even life-changing. Under Minnesota law, you can pursue compensation through a personal injury lawsuit.
In 2020, the Ministry of Home Affairs established a committee led by Prof. (Dr.) Ranbir Singh, former Vice Chancellor of National Law University (NLU), Delhi. This committee was tasked with reviewing the three codes of criminal law. The primary objective of the committee was to propose comprehensive reforms to the country’s criminal laws in a manner that is both principled and effective.
The committee’s focus was on ensuring the safety and security of individuals, communities, and the nation as a whole. Throughout its deliberations, the committee aimed to uphold constitutional values such as justice, dignity, and the intrinsic value of each individual. Their goal was to recommend amendments to the criminal laws that align with these values and priorities.
Subsequently, in February, the committee successfully submitted its recommendations regarding amendments to the criminal law. These recommendations are intended to serve as a foundation for enhancing the current legal framework, promoting safety and security, and upholding the constitutional principles of justice, dignity, and the inherent worth of every individual.
4. 4
Executive Compensation
• Beyond “benefits” - seeking to align the interests of officers/key managers
and owners through salary, short and long term financial incentives
• Executive compensation touches on many areas of law, including corporate,
securities law, labor and employment
• Requirements originate from various sources, depend on whether a
company is public or private
• Internal Revenue Code – public and private
• Other laws/regulations (e.g., Dodd-Frank) – public
• NYSE/NASDAQ – public
• Governance organizations (e.g., ISS, Glass-Lewis) – public
• Institutional shareholders – public
5. 5
Related Tax Rules
• Several Internal Revenue Code sections govern executive compensation,
which generally apply to both public and private companies.
• Section 409A — Deferral rules
• Section 280G and Section 4999 — Golden parachute rules
• Section 162(m) — $1 million compensation deduction limit (only applies to
public companies)
5
7. 7
Introduction – Dodd-Frank Act, Section 956
• Section 956 of the Dodd-Frank Act requires U.S. financial regulators to issue
rules prohibiting types and features of incentive compensation
arrangements that “encourage inappropriate risk-taking” at “Covered
Financial Institutions”
• Proposed rules were revised in 2016, purportedly to reflect the latest
practices of financial institutions and to align with rulemaking by foreign
regulators
• Compliance would be required by no later than the beginning of the first
calendar quarter that begins at least 540 days after final rule is published
• The proposed rule would not apply to any incentive-based compensation plan
with a performance period that begins before the compliance date
• For calendar year institutions, the earliest that the new rules would apply is
for periods beginning January 1, 2019
8. 8
Pause: But, We're Not a Bank
• While Dodd-Frank 956 is initially limited to large financial institutions, it’s
likely to affect others
• Experience from say-on-pay votes
• Changing the vocabulary, points of reference
• Changing perception of best practices
• ISS/institutional pressure
• Also changes the use of some terminology, which may creep into general
parlance
9. 9
Covered Financial Institutions and Covered
Employees
• “Covered Financial Institutions” – classified by average total consolidated
assets:
• Level 1: $250 billion or more
• Level 2: $50 billion or more but less than $250 billion
• Level 3: $1 billion or more but less than $50 billion
• Level 1 and Level 2 CFIs would be required to subject “Qualified Incentive-
based Compensation” for “Senior Executive Officers” and “Significant Risk-
Takers” to: deferral of payment; risk of downward adjustment and
forfeiture; and clawback
• “Senior Executive Officers” include heads of major corporate, risk, and
control functions – broader than the SEC's “Executive Officer” definition
• “Significant Risk-Takers” are determined based on compensation and
exposure; goes beyond officers
10. 10
Covered Financial Institutions and Covered
Employees (cont.)
• Level 3 CFIs would generally only be subject to a basic set of prohibitions
and disclosure requirements
• Exceptions would apply to Level 3 institutions where the activities, complexity
of operations, risk profile, etc., consistent with those of a larger institution
• Each Level 3 institution’s governing regulatory agency would have the
discretion to determine the applicability of the proposed rules
• Bottom line – initially only applies to very large institutions
• But, effects still likely to go beyond them
11. 11
• Mandatory deferral of a portion of all Incentive-based Compensation
awarded to a Senior Executive Officer or Significant Risk-Taker
• "Incentive-Based Compensation" – any variable compensation, fees, or
benefits that serve as an incentive or reward for performance
• Deferral requirements vary depending on role and whether long-term or not
• Can be up to 60% of Incentive-Based Compensation
• Up to four years
• Generally shorter deferrals for long-term compensation
• Deferrals are from the time of the “award” – which means the time when we
normally considered an award to “vest” at the end of a performance period
Deferral Requirements
12. 12
• Deferred awards may not vest faster than pro-rata, on an annual basis
• Deferral must include substantial portions of equity-like instruments and
cash
• Options may not represent more than 15% of the required deferral
• Required deferral can only accelerate on death or disability
• Potential benefit – may reduce compensation expense
• Tax issue – likely taxable to executive before the holding period expires
• Mere clawback isn’t a sufficient risk of forfeiture to delay taxes
Additional Prohibitions/ Requirements for
Deferrals
13. 13
Forfeiture, Adjustment, Clawback
• For defined Risk Events/Failures, deferred compensation subject to:
• Forfeiture (after Performance Period ends)
• Downward Adjustment (during Performance Period)
• Risk Events/Failures go well beyond restatements, such as:
• “Inappropriate risk-taking”
• Regulatory non-compliance
• Risk management or control failures
• Compensation also subject to clawback for a period of 7 years
• Measured from “vesting” (meaning after the deferral period, not the end of
the performance period)
14. 14
• Prohibits CFIs and Covered Persons from hedging deferrals
• Establishes maximum amounts to Incentive-based Compensation
opportunities
• Creates standards for performance measures
• Cannot rely solely on relative measures
• Cannot rely solely on transaction or revenue volume measures without regard
to transaction quality
• Requires risk management and compliance systems
• Mandates an independent compensation committee
• Must receive input to evaluate risk
Additional Prohibitions/ Requirements
15. 15
• Will require that plans and award agreements be reviewed and amended
for compliance
• Need to create effective processes to evaluate risk
• Does this cause executives to demand more non-incentive pay?
• How much will now serve as a base expectation for institutional
shareholders or governance groups?
• Will this be pushed through in the new Administration?
Practical Consequences/Questions
17. 17
Section 409A Basics
• Section 409A (i) requires:
• Requires any election to defer compensation to made by certain deadlines;
• Restricts payment of the compensation to certain objective payment triggers;
and
• Generally prohibits the parties from accelerating or further deferring the
payment.
• A violation of Section 409A typically results in the service provider (e.g., the
employee) recognizing immediate taxable income, paying a 20% penalty
and paying interest.
18. 18
Basics: Plan Types Under 409A
• Account balance plans for non-elective deferrals
• Account balance plans for elective deferrals
• Non-account balance plans
• Involuntary separation or window program payments
• Reimbursement plans
• Certain foreign plans
• Stock rights
• Split dollar
• All other
19. 19
Basics: Deferrals Can Come From
Anywhere…
• Employment Agreements
• Supplemental Executive
Retirement Plans
• Severance Arrangements
• Stock Option Plans
• Split-Dollar Life Insurance
• 457(f) Plans
• Commission Arrangements
• Medical or Other Reimbursement
• Tax Gross-Up Agreements
• Nonqualified Defined
Contribution and Defined
Benefit Plans
• Phantom Stock Plans
• Restricted Stock Units
• 401(k) “Wrap” Plans
• Excess Benefit Plans
• Bonus & Incentive Plans
• Change in Control Agreements
• Foreign Plans not Covered by Treaty
20. 20
Basics: Exceptions to 409A
• Short Term Deferrals
• Payment is received no later than 2 ½ months after the year in which the
employee is vested
• Payments to be paid under written arrangement between January 1 and
March 15 of the following year can be paid up to the end of that calendar year
• If arrangement not in writing, amounts paid after March 15 of the following
year will violate Section 409A
• Involuntary Severance Payments
• Payments triggered by involuntary termination of employment
• Up to 2 times pay or, if less, $540,000
• Payable within 2 years of termination
• Other Exceptions Permitting Delay of Certain Payments:
• Administratively impracticable and unforeseeable
• Jeopardize status as a going concern
• Payments for which Section 162(m) would limit the deduction
21. 21
IRS Clarifies Numerous 409A Issues
• June, 2016 IRS proposed regulations (the "2016 Proposed Regulations")
clarify 19 fairly narrow issues under existing Code section 409A regulations
• The 2016 Proposed Regulations generally formalize informal guidance
provided by IRS personnel in recent years and provides some helpful new
flexibility in certain areas
• Taxpayers may rely on the 2016 Proposed Regulations immediately
• Focus on most significant clarifications
22. 22
IRS Clarifies Numerous 409A Issues (cont.)
• Payment of Deferred Compensation Defined
• The 2016 Proposed Regulations clarify what is treated as a payment of
compensation for purposes of Code Section 409A
• An amount is treated as paid or received for purposes of Code Section 409A
when a taxable benefit is actually or constructively received
• Examples: transfer of cash, transfer of property taxable under Code Section 83,
transfer to a “secular” trust taxable under Code Section 402(b), or income
inclusion under Code Section 457(f) (affecting ineligible deferred compensation of
tax-exempt employers)
• Amounts taxable under Code Sections 83 or 402(b) generally are not treated as
“paid” until includible in income (generally on vesting or pursuant to an 83(b)
election)
• The transfer of an option that does not have a readily ascertainable fair market
value (such as a typical compensatory option) is not treated as a “payment” for
this purpose
23. 23
IRS Clarifies Numerous 409A Issues (cont.)
• Beneficiaries Treated Like Participants
• Death of a Beneficiary
• Death of a beneficiary, like the death of a participant, can now clearly serve as a
permissible payment event
• For example, a plan could provide that installment payments being made to a
participant continue to be made on the same schedule to a beneficiary after the
participant’s death, but upon the death of the beneficiary remaining benefits are
paid in a lump sum
• Intervening Events
• Currently the regulations allow a plan to provide for a change in timing for
payments that have already commenced based on an intervening event
• For example, a plan could provide that payments that commence upon a
separation from service will be accelerated and paid in a lump sum upon a
participant’s death
• The 2016 Proposed Regulations provide that such an intervening event plan
provision may be based on the death, disability or unforeseeable emergency
experienced by a beneficiary
24. 24
IRS Clarifies Numerous 409A Issues (cont.)
• New Payment Flexibility on Death
• Post-Death Payment Period
• A plan can now provide that a payment triggered by a death (of a participant or a
beneficiary) will be made or commence during any period falling within the
timeframe from (1) date of death to (2) December 31 of the year following the
year of death (instead of being limited to the normal 90 day post-event period)
• Any such period specified in a plan can be changed within this permissible range
without running afoul of the Code Section 409A rules on changes in payment
timing
• Deemed Timely Payment
• Regardless of any post-death payment period specified in a plan, payments will be
treated as made or commencing on time as long as the payment is made or
commences between (1) date of death, and (2) December 31 of the year following
the year of death
• The payment recipient may elect the year of payment without running afoul of the
section 409A rules (although the normal constructive receipt rules may present an
issue here)
25. 25
IRS Clarifies Numerous 409A Issues (cont.)
• Correction of Unvested Amounts
• The 2016 Proposed Regulations add considerable specificity in terms of anti-
abuse requirements, including that
• the arrangement must be noncompliant with Code Section 409A prior to the
change
• there is no pattern or practice of permitting similar failures,
• the correction generally be consistent with prescribed corrections under IRS
corrections guidance (such as in IRS Notice 2008-113 and IRS Notice 2010-6), and
• that a method of correction be consistently applied
• The requirement to conform to correction methods specified in IRS
corrections guidance for unvested amounts can be expected to significantly
alter how many of these corrections are performed
26. 26
IRS Clarifies Numerous 409A Issues (cont.)
• Other Clarifications
• Separation from Service for Dual Status Employees
• When an individual moves from employee status to independent contractor status,
whether he experiences a “separation from service” at that time depends on the
employee rules
• If there is no separation at that point, the independent contractor rules apply in
determining whether a separation occurs thereafter
• Termination and Liquidation of Plan
• If an employer takes advantage of the plan termination and liquidation rules
for one plan, all plans of the same type (e.g., nonqualified elective deferral
plans) maintained in the controlled group must be terminated
• Two Times Pay Exemption for Severance
• The current regulations exempt certain severance arrangements limited to
“two times pay"
• The 2016 Proposed Regulations describe how this exemption applies to
individuals hired and terminated in the same year
28. 28
What are Golden Parachute Payments?
• Payments are parachute payments if:
1. Made in the “nature of compensation”,
2. Made to a “disqualified individual” (DI), (e.g. an officer, a shareholder, or highly
compensated individual),
3. Contingent on a change in the ownership, control, or assets of the corporation,
and
4. The aggregate present value of the compensation payments equals or exceeds
3 times the base amount
• Two basic penalties:
1. The company loses its deduction for a portion of the compensation paid, and
2. The individual pays 20% excise tax on the compensation deemed to be an
excess parachute payment
The Consequences
29. 29
• Applies only to publicly held corporation
• No deduction allowed for applicable compensation paid during the year
• To any covered employee
• That exceeds $1 million dollars
• Covered employee
• CEO and 4 highest paid officers required to be reported under Securities
Exchange Act (CFO gets excluded from this definition)
• Applicable compensation equals all deductible compensation before
application of this limit except
• Commission
• Performance based compensation
• Performance based compensation must be paid under plan approved by
shareholders at least as frequently as every 5 years
Section 162(m) Overview
31. 31
SEC Dodd-Frank Proxy Rules Update
• Generally applicable to publicly held companies
• Except as noted, not to emerging growth companies
• CEO Pay Ratio Rule – Now final (effective for years beginning 1-1-17
• To be disclosed in following year's proxy statement ('18 annual meeting)
• Companies required to disclose:
• The annual total compensation of the "Median" employee, excluding the CEO
• The annual total compensation of the CEO
• The ratio of those two amounts
• Hopes for deferral/repeal – on Congress’s target list
32. 32
SEC Dodd-Frank Proxy Rules Update (cont.)
• Pay for Performance
• Still proposed
• Won't be effective for 2017, for calendar year companies at least
• Companies will be required to disclose:
• Tabular disclosure covering up to 5 years of comp “actually paid” to the
CEO and an average of comp “actually paid” to the other NEOs
• Relationship between:
• Compensation “actually paid” and the registrant’s total shareholder return
(“TSR”), and
• The registrant’s TSR and a peer group return
33. 33
SEC Dodd-Frank Proxy Rules Update (cont.)
• Executive Compensation Clawbacks – Proposed
• Will apply to all current and former executive officers
• Current rules cover only CEO and CFO
• ISS and other governance groups already look for clawback policies
• Clawback trigger event - a "Correction of Errors“
• If the issuer must prepare an accounting restatement due to the material
noncompliance with any financial reporting requirement, the issuer must claw
back related compensation
• Current rules cover narrower circumstances
• Also applies to emerging growth companies
34. 34
• In December 2016, ISS updated its guidelines for evaluating equity-based
compensation plans
• ISS continues to employ three “pillars” – 100 total points
• Plan cost – 45 points
• Plan features – 20 points
• Grant practices – 35 points
• 53 points is “passing”
• Negative points are possible
• What's new?
• Tweaks of the ISS plan cost formula
• Expanded minimum one-year vesting requirements
• Penalties for dividends on unvested awards
• Greater positive weighting for performance-based grants
ISS Updated Plan Guidelines