Proxy Season Preview: Preparing Your Community Bank and its Shareholders for Upcoming Annual Meetings
March 1, 2012
ICBA Independent Banker (Independent Community Bankers of America)
Penny Somer-Greif was interviewed by the ICBA on the SEC's say-on-pay rules for smaller public companies. Say-on-pay refers to the process by which shareholders participate in advisory votes on executive compensation. The SEC also requires public companies to conduct advisory votes on the desired frequency of say-on-pay votes and on arrangements for any so-called golden parachutes that may be issued in conjunction with merger transactions.
Smaller public companies – including many community banks – do not have to conduct say-on-pay and frequency votes until next year, and don’t have to issue any say-on-pay disclosures until 2014.
"The SEC rule says that smaller public companies only have to discuss the say-on-pay vote if it was material to their executive compensation decisions, but I’m expecting if there was any discussion, stockholders would expect to see it discussed," says Penny Somer-Greif, an associate with the law firm Ober|Kaler in Baltimore and a former SEC attorney-adviser.
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