REITs Executive Compensation Guide

There are several methods to satisfy the prospectus delivery requirements. The company may deliver a paper copy of the prospectus to each participant (e.g., by mail or hand delivery). Alternatively, the company may satisfy its obligations by means of electronic delivery, such as by email, if certain conditions are met. PRACTICE POINT: If a NYSE-listed REIT files a Form S-8 registering the issuance of securities under an equity incentive or similar plan, it must also file a supplemental listing application with the NYSE to list those securities on the NYSE. Nasdaq does not require a supplemental listing application as long as the awards are granted under a stockholder-approved plan. Item 5.02(e) of Form 8-K requires disclosure when: (i) a company enters into, adopts or commences a material compensatory contract, plan or arrangement (collectively, a “ compensation arrangement ”), as to which the company’s principal executive officer, principal financial officer or another NEO participates or is a party; (ii) a compensation arrangement is materially amended or modified; or (iii) the company makes a material grant or award under any such compensation arrangement. Generally speaking, if any of the enumerated items discussed above are triggered, the company must file an Item 5.02(e) Form 8-K—within four business days of the triggering event—that provides a brief description of the terms and conditions of the compensation arrangement and the amounts payable under the compensation arrangement or any amendment or modification to the compensation arrangement. Item 5.02(e) of Form 8-K

Additionally, the staff of the SEC’s Division of Corporation Finance (the “ Staff ”) has adopted an interpretative position that the cancellation of a material compensatory arrangement triggers a disclosure requirement under Item 5.02(e) of Form 8-K if the termination constitutes a material amendment or modification. 14 This obligation exists in lieu of reporting under Item 1.02 of Form 8-K (i.e., Termination of a Material Definitive Agreement). The Staff has taken the position that an automatic renewal of covered executive officers’ compensation arrangements does not give rise to Item 5.02(e) disclosure requirements. Disclosure on Form 8-K is not required for any grant, award or modification made pursuant to a plan or arrangement that is materially consistent with previously disclosed terms of the plan or arrangement. Exchange Act Rule 12b-2 defines “previously reported” broadly to include, among other filings, Form 8-Ks, Form 10-Qs, Form 10-Ks, proxy statements and registration statements. PRACTICE POINT: Any compensatory arrangement that requires stockholder approval is material for the purpose of Item 5.02(e), and therefore is subject to disclosure. The disclosure requirement for such plans is triggered when the compensation plan or arrangement receives stockholder approval, rather than upon the date on which the compensation arrangement is approved by the board of directors or a duly authorized committee.

14 See SEC Compliance and Disclosure Interpretations—Exchange Act Form 8-K Question 117.14.

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