S-K 402 is the primary SEC disclosure item
for executive compensation

• Substantially revised per SEC Release 33-8732  2006

• "Represents a thorough rethinking of the rules in place prior to these amendments, combining a broader-based tabular presentation with improved narrative disclosure supplementing the tables"

• More changes adopted per SEC Release 33-8765  2006
• SEC FAQs  1.24.07
• See SEC Comment Letters on Executive Pay for SEC staff observations from its review of executive pay disclosures filed during 2007 proxy season
• Access RiskMetrics Group study dated October 2007 and prepared by ISS Center for Corporate Governance

• Compensation Disclosure: Best Practices and Examples

Key changes to S-K 402

• Compensation discussion and analysis

• S-K 402(b) Topic Page

• Summary Compensation Table revised and expanded

• Foots to an annual total compensation figure
  for each NEO
• S-K 402(c) Topic Page

• New tables with narrative discussion added to cover

• Plan-based awards  S-K 402(d) Topic Page
• Outstanding equity awards  S-K 402(f) Topic Page
• Option exercises - stock vested  S-K 402(g) Topic Page
• Pension benefits  S-K 402(h) Topic Page
• Nonqualified plan  S-K 402(i) Topic Page
• Director compensation  S-K 402(k) Topic Page

• Revised narrative discussion

• Narrative for 402(c) and (d) S-K 402(e) Topic Page
• Termination - Change-in-control  S-K 402(j) Topic Page

Over-arching principle

• Must disclose all items of compensation in "plain English"
• Alan Beller speech  10.20.04

• Roel Campos speech  1.23.07

• Chairman Cox speech   3.23.07

Changes to definition of named executive officer

• Include chief financial officer regardless of
  compensation and $100,000 threshold based on total compensation rather than salary and bonus

Applies to fiscal year ending on or after 12.15.06

• Effective Dates

Information on old S-K 402, S-K 402 Archive

SEC makes changes to S-K 402

• SEC Rel 33-8765
• Changes were effective 12.29.06

Changes affect

• S-K 402(c)  Summary compensation table
• S-K 402(d)  Grants of plan-based awards table
• S-K 402(k)   Director compensation disclosures

Changes to S-K and S-B items and proxy rules

• Necessitated by changes to S-K 402
• Final release commentary  Rel 33-8732 § II.E

10-K

Form 10

S-1

S-3

S-4 

S-11

S-K Item 402 FAQs

• Supersede old S-K 402 FAQs in 1997 Telephone Manual
  and its March 1999 Supplement
• Divided into two parts

• Questions and Answers of General Applicability
• Interpretive Responses Regarding Particular Situations

Index to FAQs and related Topic Pages

• Questions And Answers Of General Applicability

§	Link to FAQs	Link to Topic Page
1	402	--
2	402(a)	--
3	402(b)	CD&A
4	402(c)	Summary comp table
5	402(d)	Grant table
6	402(e)	Narrative for tables
7	402(f)	Outstanding awards table
8	402(g)	Exercises - vested table
9	402(h)	Pension benefits table
10	402(i)	Deferred comp table
11	402(j)	Termination table
12	402(k)	Director comp table

• Interpretive Responses Regarding Particular Situations

§	Link to FAQs	Link to Topic Page
1	402	--
2	402(a)	--
3	402(b)	CD&A
4	402(c)	Summary comp table
5	402(d)	Grant table
6	402(e)	Narrative for tables
7	402(f)	Outstanding awards table
8	402(g)	Exercises - vested table
9	402(h)	Pension benefits table
10	402(i)	Deferred comp table
11	402(j)	Termination table
12	402(k)	Director comp table

Select Proxy and Other 1934 Act Filings

Select Proxy and Other 1934 Act Filings

Select S-1 and S-4 Filings 

Speeches by SEC Commissioner

• 2007 Summit on Executive Compensation  1.23.07

• 2007 Corporate Counsel Institute  3.08.07
• 2nd Annual Corporate Governance Summit  3.23.07

NACD and Council for Institutional Investors

• Joint task force report with recommendations on majority voting, Section 404, and executive pay  January 2007

ISS Corporate Governance Blog analysis

• The Challenge of Valuing Stock Options  2.20.07

Speech by Director White

• The Promise of Transparency  2.23.07

ABA Committee on Federal Securities Regulation 

• Dialogue with John White, Director of the Division of Corporation Finance  3.16.07

Comment Letters 

• Received by SEC from individuals and entities in response to the Proposing Release
• See also letter from CFA Institute Centre for Financial Market Integrity dated 12.20.07

Paul Hastings  March 2007

• Insights - and Key Examples - from the First CD&As

Winston & Strawn  March 2007

• Debunking Myths Under the New SEC Disclosure Rules as We Head into the Home Stretch

Kirkland & Ellis  April 2007

• The Media and Executive Compensation Disclosures

King & Spalding  May 2007

• Executive Compensation Disclosure Rules

Kaye Scholer  December 2007

• 2008 Proxy Season: Focusing on Your Executive Compensation Disclosures

Latham & Watkins  2.11.08

• 2008 Proxy Season: New Developments and Reminders Regarding Executive Compensation Disclosures and Equity Plans

Wachtell Lipton  2.19.08 

• Executive Compensation 2008
  Executive compensation will continue to attract significant interest in 2008. In light of this attention, this memorandum describes some key recommendations for directors to consider as they address executive compensation matters in the coming year.

• Focus on Long-Haul
• Pay for Performance and Retention
• Succession Planning
• Wealth Accumulation and Internal Pay Equity
• Compensation Consultants
• Disclosure and Analysis
• Disclosure of Performance Targets

Executive Compensation Disclosures

S-K 402 Archive

S-K Index

Equity Compensation Accounting