1. US Update: Equity Compensation in Dublin Chapter Meeting Wednesday, 23 September 2009 Michael Bendorf Executive Director, Global Equity Organization

2. Introduction
After an extreme period of turbulence, search for new best practices in equity compensation is ongoing
Ongoing discussion about how best to use compensation to support acceptable risk & reward
Increasing appetite for regulatory solutions
Enhanced disclosure or “reasonable” program guidelines?
Governments searching for new sources of revenue
Greater fluidity in service provider alliances as issuers looking for greater value at lower cost

3. Corrective measures have become popular
Clawbacks
64% of Fortune 100 companies have policies in place to recoup ‘improper’ or ‘excessive’ compensation1
Up from just 17% in 2006
Option Resetting
At one point earlier this year, as many as 90% of stock options held by employees at Fortune 500 firms were underwater
More than 100 tech/biotech firms have conducted option exchange programs in the past two years2
53% Options for options
30% Options for restricted stock
12% Options for combination of options & restricted stock
1 Equilar 2009 Executive Compensation Outlook
2 Radford 2009 Mid-year Update

4. Prescriptive measures are also under consideration
Greater understanding of how equity vehicles can impact appetite for risk
Continued increase in use of restricted stock/RSUs at all but the smallest technology firms
68% of technology firms now emphasize full value awards
Equity Mix Emphasis ( )
Source: Radford 2009 Mid-year Update

5. Prescriptive measures are also under consideration
Performance-based equity continuing to make inroads
Use of performance attachments increasing, but limited
71% of large technology firms use, but only on 5% of award pool1
Ongoing discussion regarding timeframes and measures
Equity compensation programs are becoming more complex, in part a recognition of multiple roles
Prevalence of Equity Compensation Design for S&P 5002
1 Radford 2009 Mid-year Update
2 Equilar CEO Pay Strategies Report for S&P 500

6. Forecast for 2010
Enhanced regulatory efforts will mark executive compensation in the coming year
New ‘Compensation Czar’ empowered to set or influence compensation levels at TARP recipients
Impact likely to extend beyond just Financial Services sector
Legislation pending in Congress to give shareholders non-binding ‘say-on-pay’
SEC proposing new rules to increase independence of Compensation Committees
Potential impact of G20 discussions in Pittsburgh this coming week unknown

7. Questions and Discussion
For more information
Equilar
David Sasaki
Radford Surveys + Consulting
Brett Harsen