We believe many companies are taking a wait-and-see approach to the proposed rules. While some companies recognize their disclosures are inadequate, most want to see what the final rules entail and how other companies respond.

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As companies continue to expense their stock options, we expect to see a growing number of companies embrace other forms of incentives for their executives, such as performance-based stock. Although the vehicles may change, the goal of keeping executives motivated and engaged while effectively tying their pay to performance is as important as ever.

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