This excerpt taken from the EGBN DEF 14A filed Apr 6, 2009.
Emergency Economic Stabilization Act of 2008. As noted above, the Company sold shares of a series of its preferred stock and common stock purchase warrants to the Treasury under the CPP established under EESA. As a result of this transaction, the Company became subject to certain executive compensation requirements under the CPP, the EESA, and Treasury regulations. Those requirements apply the Companys named executive officers of the Company, as they be determined from time to time (collectively, the SEOs). Those requirements are:
· A prohibition on providing incentive compensation arrangements that encourage SEOs to take unnecessary and excessive risks.
· The compensation committee must review SEO incentive compensation arrangements with the senior risk officers to ensure that SEOs are not encouraged to take such risks and must meet annually with the senior risk officers to discuss and review the relationship between risk management policies and practices and the SEO incentive compensation arrangements.
· Recovery of any bonus or incentive compensation paid to an SEO where the payment was later found to have been based on statements of earnings, gains, or other criteria which prove to be materially inaccurate.
· Limits on the amounts that can be paid under change in control and similar agreements which provide payments upon separation of service.
· Limits on the Companys tax deduction for compensation paid to any SEO to $500,000 annually.