Square D Company and Subsidiaries - Page 113

                                       - 92 -                                         
          insistence on adherence to SEC disclosure conventions in this               
          circumstance actually produces significant distortions.                     
          Specifically, Ms. Meyer would exclude any portion of the LTIP               
          payout from the measurement of the Retained Executives’ 1992                
          compensation, while at the same time she includes in the 1992               
          compensation of her purportedly comparable executives any long-             
          term incentive compensation payouts to them that happen to be               
          disclosed for 1992.  Such amounts are included in the 1992                  
          compensation of her purportedly comparable executives even where            
          they represent compensation for multiple years.55  Thus, the                
          version of conformity to SEC disclosure conventions that Ms.                
          Meyer advocates systematically inflates the 1992 compensation of            
          her purported comparables in relation to her computation of the             
          1992 compensation of the Retained Executives, which generates a             
          distorted comparison favoring petitioner’s position.  We                    
          accordingly reject it.                                                      
               We believe that a clear and convincing showing of reasonable           
          compensation for purposes of section 280G(b)(4) in this case must           
          take some account of the substantial LTIP payouts made to the               
          Retained Executives.  Mr. Rosenbloom’s determination to treat the           


               55 For example, Ms. Meyer includes in the 1992 compensation            
          of comparable executives Bielenski and Baisley, of W.W. Grainger,           
          Inc., their long-term incentive compensation payouts in 1992 of             
          $71,300 and $56,300, respectively, even though that company’s               
          proxy materials in the record disclose that the payouts covered 3           
          fiscal years (1990-92).                                                     





Page:  Previous  82  83  84  85  86  87  88  89  90  91  92  93  94  95  96  97  98  99  100  101  Next

Last modified: May 25, 2011