On June 20, 2012, in furtherance of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, the Securities and Exchange Commission adopted new Rule 10C-1 under the Securities Exchange Act of 1934 and amendments to Item 407 of Regulation S-K that, among other things, focused on ensuring the independence of compensation committee members by directing the national securities exchanges to "establish listings standards that ... require each member of a listed issuer's compensation committee to be ... â€Üindependent' as defined in the listing standards of the exchange." In response to this SEC release, on January 11, 2013, each national securities exchange adopted new listing standards to comply with new Rule 10C-11.

The requirements of Rule 10C-1 and the new listing standards of each of the NYSE and NASDAQ are summarized below.

Footnotes

1 For a further discussion on (a) the SEC's adopting release for Rule 10C-1 and amendments to Item 407 of Regulation S-K, please see our Client Alert entitled "SEC Adopts New Rules Requiring Stock Exchange Listing Standards For Compensation Committees" (June 27, 2012) and (b) the proposed rule releases for each national securities exchange, please see our Client Alert entitled "NYSE and Nasdaq Issue Proposed Rules for Compensation Committees" (October 18, 2012).

2 When determining "independence" under its current listing standards, the NYSE rules (a) require a board to affirmatively determine that a director has no material relationship to the company and (b) provide that a director may not be independent if a relationship exists that would violate five "bright line" tests.

3 When determining "independence" under its current standards, the NASDAQ rules (a) require a board to affirmatively determine that a director does not have a relationship that would interfere with the exercise of independent judgment in carrying out that director's responsibilities and (b) provide that certain categories of director, based on certain identified relationships, cannot be independent.

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