According to the Securities and Exchange Commission (SEC) filing, the company said it may cancel or require reimbursement of any incentive compensation received by any officer after July 19, 2007, if certain conditions exist.
The rule the company terms “clawback” allows MMC to make the move if the amount of the incentive compensation was based on the achievement of specified consolidated and/or operating company financial results; MMC subsequently restates those financial results; in the compensation committee’s judgment, the officer engaged in intentional misconduct that contributed to the need for the restatement; and the officer’s incentive compensation would have been lower if the financial results in question had been properly reported.
MMC said it will not seek to recover incentive compensation paid more than three years prior to the date the applicable restatement is disclosed.
In the filing MMC identified what it called a “Double-Trigger” condition for vesting of equity-based awards upon a change in control. The new rule provides that vesting will occur if during the 24 months following the change in control, the employee was terminated without cause or resigned for good reason.
The “Double-Trigger” rule changes the existing mandate that allowed for equity-based awards to become immediately fully vested on a change in control.
MMC said in the filing, “These policies result from the Board’s ongoing review of corporate governance practices at MMC, and are among the latest in a series of governance enhancements implemented by the Board since 2005.”
The filing is here .