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Clawbacks and Compensation Plan Design


Product Code - LGN259
Speaker(s): Doreen E. Lilienfeld, Shearman & Sterling LLP; Ronald O. Mueller, Gibson Dunn & Crutcher LLP; Russell G. Ryan, King & Spalding LLP; Steven A. Seelig, Towers Watson
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Under upcoming Dodd-Frank rule-making, public companies will be required to develop, disclose and implement a clawback policy. This policy will allow the company to recover from current or former executives incentive-based compensation that was based on erroneous data if the company must restate its financial statements due to material noncompliance with financial reporting requirements. Even in the absence of SEC rule-making, many investors are encouraging companies to adopt or enhance their clawback policies, and many companies have addressed these issues. This program will identify the significant design, tax, enforcement and other issues that companies need to consider when designing and implementing clawbacks.

The faculty presenting this program will begin with an overview of the current state of clawbacks. What do most companies have in place and why do they have those provisions? They will explore the current state of SEC enforcement actions under Sarbanes-Oxley and how those actions have been dealt with by the courts. They will also review the current state of the law as it affects private enforcement actions by companies seeking clawbacks from their employees and former employees.

The program will explore the provisions of the Dodd-Frank statute, what the statute says and the issues the SEC must confront as it crafts proposed regulations for implementing the requirement that companies have clawback policies in place for circumstances of financial restatements. The speakers will prognosticate where the regulations may be headed and identify the most difficult issues the SEC must resolve.

Next, the program will cover both the tax implications of an executives being required to pay back prior compensation and the potential accounting implications to companies that grant equity compensation subject to a clawback provision. Finally, based on these issues, the faculty will discuss the issues companies will confront in implementing clawback provisions and how those issues may influence future executive compensation designs.

Educational Objectives:

• Learn the current state of clawback provisions, SEC enforcement efforts and court cases involving clawbacks.
• Understand the Dodd-Frank provisions and the open issues that the SEC is expected to address in its proposed rule-making.
• Find out about the current regime for executives who are required to repay compensation received in a prior tax year, as tax issues will influence clawback design.
• Understand related accounting issues, as the issue of discretion to enforce clawbacks and how it can cause variable plan accounting is being debated between companies and their auditors.
• Learn how Dodd-Frank clawbacks may influence future plan design.

Who would benefit most from attending this program?

Compensation and benefits practitioners, corporate counsel, compensation consultants and SEC and corporate governance counsel would all benefit from attending.

Program Level: Intermediate-Advanced

Prerequisite: An understanding of executive compensation issues.
CPE Delivery Method: Group Internet-Based Live
Field of Study: Specialized Knowledge and Applications
Recommended CPE Credit: 1.5 credits
Anticipated CLE Credit: 1.5 credits (may vary based on from which jurisdiction requested)

For additional information, please see the “CE Credit” tab.

Doreen E. Lilienfeld, Shearman & Sterling LLP; Ronald O. Mueller, Gibson Dunn & Crutcher LLP; Russell G. Ryan, King & Spalding LLP; Steven A. Seelig, Towers Watson

Doreen E. Lilienfeld, Shearman & Sterling LLP
Doreen Lilienfeld is a partner with Shearman & Sterling, where she serves as the Deputy Practice Group Leader of the Executive Compensation & Employee Benefits Group. She has been involved in a wide variety of compensation-related matters, including the design and implementation of retention and compensation plans, disclosure and regulatory compliance, and employment negotiations with senior executives. Ms. Lilienfeld has significant experience in compensation and benefits issues relating to private equity and other mergers and acquisitions transactions. She has advised both U.S. and non-U.S. issuers on corporate governance and regulatory requirements relating to compensation and benefits matters.

Ms. Lilienfeld has been resident in the Frankfurt, London and Bay Area offices of Shearman & Sterling. For the past ten years, Ms. Lilienfeld has spearheaded the publication of the Shearman & Sterling LLP survey of the compensation-related corporate governance practices of the largest 100 domestic issuers. She became a member of the firm’s nine-member elected Policy Committee in 2014.

Ms. Lilienfeld earned a J.D., magna cum laude, from the Benjamin N. Cardozo School of Law, where she served as Managing Editor of the Cardozo Law Review, and a B.A., with honors, in Psychology from New York University. She is admitted to practice in New York and California.

Ronald O. Mueller, Gibson Dunn & Crutcher LLP
Ronald Mueller is a partner in the Washington, D.C. Office of Gibson, Dunn & Crutcher and works in the securities regulation and corporate governance area with an emphasis on proxy and disclosure issues, executive compensation, and corporate transactions. He was named by BTI Consulting Group as a 2014 BTI Client Service All-Star for delivering “outstanding legal skills enveloped in a rare combination of practical business knowledge, extraordinary attention to client needs and noteworthy responsiveness.” He is listed in the 2014 edition of The Best Lawyers in America® in the categories of corporate governance law, corporate compliance law, and securities regulation. Mr. Mueller is active in the Committee on Federal Regulation of Securities of the American Bar Association and is a frequent speaker and author on securities and corporate governance matters, including and developments in proxy disclosures and proxy contests, the SEC's disclosure requirements, corporate governance developments, Section 16 rules, and executive compensation issues.

Mr. Mueller earned a J.D. from Columbia Law School, where he was a Harlan Fisk Stone Scholar and a James Kent Scholar, and a B.A., magna cum laude, from Vanderbilt University. Mr. Mueller is a member of the District of Columbia Bar Association and the American Bar Association and is admitted to practice before the courts of New York and Washington.

Russell G. Ryan, King & Spalding LLP
Russ Ryan is a partner in the Washington, D.C. office of King & Spalding, where his practice focuses primarily on SEC enforcement investigations, corporate internal investigations, Foreign Corrupt Practices Act (FCPA) compliance, and related corporate governance issues. He recently represented a public-company CEO in connection with one the SEC’s first “no-fault” clawback enforcement cases under Sarbanes-Oxley Section 304, and he is the author of a forthcoming BBNA portfolio on the subject of Section 304 clawbacks.

Mr. Ryan currently serves as Vice-Chair of the Broker-Dealer and SEC Enforcement Committee of the DC Bar’s Corporation, Finance, and Securities Law Section. He has been recognized as one of the “SEC Enforcement 40,” an elite group of the top SEC enforcement defense lawyers, and as a Washington, D.C. “Super Lawyer” in the area of securities litigation. Mr. Ryan joined King & Spalding in 2004 after a 10-year career in the SEC’s Division of Enforcement, including his last three years as Assistant Director of the Division. He is a nationally-recognized expert on SEC enforcement policy and a prolific writer and speaker on related topics, including frequent contributions to the op-ed pages of The Wall Street Journal.

Mr. Ryan earned a J.D. from St. John's University and a B.A., summa cum laude, from Boston College. He is admitted to practice in the District of Columbia and New York.

Steven A. Seelig, Towers Watson
Steve Seelig is the Senior Executive Compensation Counsel for the Center for Research and Innovation of Towers Watson in Washington, D.C. He serves as the firm’s expert on matters involving the taxation, accounting and legal implications, including SEC disclosure requirements, of all forms of executive compensation and perquisite programs. Mr. Seelig is a frequent public speaker on executive compensation matters and a prolific author. He and other Towers Watson consultants author the blog: http://www.towerswatson.com/newsletters/executive-pay-matters.

Mr. Seelig earned an LL.M. in Taxation from Boston University Law School, a J.D. from Catholic University Law School, and a B.A. degree from the University of Rochester. He is a member of the District of Columbia and New York State bars.

This program’s CLE-credit eligibility varies by state. Bloomberg BNA is an accredited provider in the states of New York*, California, Pennsylvania, Texas and Virginia, and most other jurisdictions grant CLE credit on a per-program basis. At this time, Bloomberg BNA does not apply directly to the states of Florida, Rhode Island, Montana, Delaware and Hawaii although credit is usually available for attorneys who wish to apply individually. Additionally, the following states currently do not grant credit for Bloomberg BNA OnDemand programming: Arkansas, Ohio, Nebraska, and Delaware. All requests are subject to approval once the live webinar has taken place or the customer has viewed the OnDemand version. Please allow up to four to eight weeks for CLE processing. Contact the Bloomberg BNA accreditations desk if you have specific questions that have not been addressed.

*Bloomberg BNA is an accredited provider in New York for experienced attorneys only.

Hardship Policy
For information regarding Bloomberg BNA’s Hardship Policy, please visit the Continuing Education Information page.

Questions
Individual programs, subjects, and formats may not receive credit in some states and there may be specific rules regarding who may earn credit or the maximum number of credit hours that may be earned with specific formats. For specific questions, contact your state MCLE regulatory entity for specific questions about your MCLE rules or visit the American Bar Association’s website for general information on accreditation.

If you have further questions regarding a specific state or how to file for CE credit, please contact Bloomberg BNA customer service at 800-372-1033 and ask to speak to the CLE Accreditation Coordinator or send an email to accreditations@bna.com.