The Treasury could not have foreseen that it would have to carve out an exception under the 409A change in control rules for the federal government acquiring interests in financial institutions. Hence the issuance of Notice 2009-49 announcing future changes to the 409A regulations:
Questions have arisen whether the Federal government's acquisition of an equity interest in a financial institution or other entity in connection with a Treasury EESA Equity Acquisition Transaction constitutes a change in control event and accordingly a permissible § 409A payment event. . .Posted by B. Janell Grenier at June 4, 2009 02:48 PMTreating a Treasury EESA Equity Acquisition Transaction as a change in control event and, therefore, a permissible payment event, would be inconsistent with the purposes of EESA and § 409A, and would be contrary to the public interest. For example, payment of nonqualified deferred compensation amounts as a result of a Treasury EESA Equity Acquisition Transaction could reduce the liquidity of the financial institution or other entity, which is directly contrary to the purpose of a Treasury EESA Equity Acquisition Transaction.