In a “no-action” letter issued by the Securities and Exchange Commission’s Division of Corporation Finance, a firm’s use of equity-based incentive compensation was not found to violate a longstanding prohibition on companies providing personal loans to executives.
Responding to RingsEnd Partners, a financial services firm, the Division of Corporation Finance on March 4 wrote that “an issuer that permits its directors and/or executive officers to participate in the EBIC Program would not be deemed, directly or indirectly, to be extending or maintaining credit.”
