Employment Agreements. We understand the diverse and complex legal and business issues presented by executive employment agreements, including compensation arrangements, fringe benefits, severance pay, change-in-control protection, confidentiality and non-competition restrictions, and current industry practices. We assist employers in the design and drafting of executive employment agreements and related arrangements.
Equity-Based Compensation. Our Group has substantial experience related to the design, implementation and operation of equity-based compensation arrangements, including stock options, stock appreciation rights, restricted stock, restricted stock units, employee stock purchase plans, phantom stock, and performance units, taking into account a myriad of tax, accounting, and securities law considerations.
Performance-Based Compensation. Performance-based compensation plans can be an important incentive to attracting and retaining executives who have multiple employment options. Our Group can help companies structure a plan that is in compliance with federal regulations and that will provide appropriate tax benefits to both parties.
Nonqualified Deferred Compensation Arrangements. We are highly skilled in designing and implementing nonqualified deferred compensation arrangements, including plans such as top-hat, excess benefit, make-up/mirror, phantom stock, and those related to tax-exempt employers. We assist employers in the selection, design and implementation of appropriate funding vehicles, including rabbi trusts, secular trusts, and other forms of security, and ensure that all plans are in compliance with Section 409A of the Internal Revenue Code.
Severance Arrangements. We are involved in all aspects of the negotiation, design, and implementation of severance provisions, including change-in-control protection, golden handcuffs, confidentiality and non-competition.
Fringe Benefits. Our Group has substantial experience related to the design, implementation, and operation of fringe-benefit arrangements, including housing assistance, relocation benefits, meals and lodging, employer-provided automobiles, qualified transportation fringe benefits, expense reimbursements, working-condition fringe benefits and no-additional-cost fringe benefits.
Change-in-Control Protection. Change-in-control protection not only protects a company’s executives, it also benefits the company by allowing the executives to evaluate potential business combination opportunities in an unbiased manner, without being distracted or dissuaded by the potential impact on them individually. However, such protection raises a series of complex tax, corporate governance and SEC disclosure considerations. We understand the issues presented by change-in-control protection agreements and assist employers in the design and drafting of arrangements which achieve a desired balance of the corporation’s and the executive’s concerns.
Split-Dollar Life Insurance Arrangements. Creating an arrangement that mutually benefits, from a value and tax perspective, both the employer and employee is an important consideration in the realm of executive compensation. When appropriate under the situation, our attorneys guide clients in selecting the most appropriate split-dollar life insurance plan. The most common options include endorsement, assignment, equity, and reverse split-dollar.
Director Compensation Arrangements. We are regularly called on to design and implement the compensation arrangements of non-employee directors and consultants, including share-equivalent unit arrangements and performance-based compensation.
Compensation Committee Advice. The compensation committee of a public company must consider increasing legal considerations, including the fiduciary duties of its members, taxation, SEC disclosure, Sarbanes-Oxley, exchange listing rules, institutional shareholder policies, employee relations, and public image. We provide ongoing advice regarding executive compensation arrangements, including tax, corporate governance, and reporting issues.
Payroll Reporting. We have substantial experience in the payroll withholding and reporting requirements applicable to executive compensation, including Form W-2 reporting, Form 1099 reporting, federal and state income tax withholding, and FICA taxation and withholding.
Tax-Exempt Organizations. Compensating executives of tax-exempt organizations requires special attention to additional considerations, including Section 457 of the Internal Revenue Code. We work with attorneys in the firm’s Not-for-Profit Group to help tax-exempt entities evaluate, design, and implement plans and arrangements that are sensitive to all of the unique legal considerations associated with tax-exempt organizations.