Revised Executive Compensation Requirements For Participants Under The Troubled Assets Relief Program

On February 17, 2009, President Obama signed into law the American Recovery and Reinvestment Act of 2009 ("ARRA"), widely described as the Stimulus Bill.¹ ARRA significantly expands the executive compensation requirements previously imposed under the Emergency Economic Stabilization Act of 2008 ("EESA"), which established the Troubled Assets Relief Program ("TARP"), and by subsequent guidance issued by the U.S. Department of the Treasury. ARRA's executive compensation restrictions apply to any entity that has received or will receive financial assistance under TARP (a "TARP Recipient") and generally will continue to apply for as long as any obligation arising from financial assistance provided under TARP remains outstanding, other than government-held warrants (the "TARP Assistance Period"). The ARRA restrictions are not limited to recipients of the TARP Capital Purchase Program, and they have potentially broad application to anyone participating in any TARP program or