Securities Lawyer's Deskbook                          published by The University of Cincinnati College of Law

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Section 304 -- Forfeiture of Certain Bonuses and Profits

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1. Additional Compensation Prior to Noncompliance With Commission Financial Reporting Requirements. If an issuer is required to prepare an accounting restatement due to the material noncompliance of the issuer, as a result of misconduct, with any financial reporting requirement under the securities laws, the chief executive officer and chief financial officer of the issuer shall reimburse the issuer for--
   
   
   1. any bonus or other incentive-based or equity-based compensation received by that person from the issuer during the 12-month period following the first public issuance or filing with the Commission (whichever first occurs) of the financial document embodying such financial reporting requirement; and
      
      
   2. any profits realized from the sale of securities of the issuer during that 12-month period.
      
      
2. Commission Exemption Authority. The Commission may exempt any person from the application of subsection (a), as it deems necessary and appropriate.
   
   

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