Earlier this morning, President Obama announced new
executive compensation restrictions for financial institutions
receiving "exceptional assistance" in the future from the
U.S. government. (Exceptional assistance is bailout money that is
customized beyond the generally available programs). The
announcement includes several key provisions.
Highlights of this new program, which has been receiving
tremendous media attention, are as follows:
- Limits senior executives to $500,000 in total annual
compensation, other than the Restricted Stock Exception;
- Provides a Restricted Stock Exception: Excess pay above
$500,000 may be paid, but only in the form of restricted stock or
another long-term vehicle that vests when (1) the government has
been repaid with interest or (2) after a specified period according
to conditions that consider (among other factors) the degree a
company has satisfied repayment obligations, protected taxpayer
interests or met lending and stability
