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SEC CHAIR ON OPTION BACKDATING

June 13, 2006

In a recent speech SEC Chairman Christopher Cox talked about option backdating:

While I can't comment on the SEC's ongoing investigations of specific companies, I can tell you what the Commission's position is. Back-dating must be fully disclosed. And the granting of back-dated options must be properly accounted for.

As one means of dealing with this problem, our proposed executive compensation rule will provide better and more useful disclosure of the backdating of options. It would require that a company clearly identify the portion of compensation that results from "in-the-money" option awards resulting from backdating.

Via BenefitsBlog.

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