Strong businesses require strong leadership. To help organizations recruit, hire and retain key leadership and senior managers, our Firm provides high-quality, client-tailored advice on all aspects of executive compensation, including benefits, tax, securities, labor and litigation issues. Our executive compensation team draws on experienced lawyers from our benefits, corporate, tax, private client and other departments to provide seamless, coordinated advice that meets the demands of today’s global workforce.
We understand the needs of employers and industry groups, and take into account the political, economic and social issues that drive legislators and regulators who develop and enforce executive compensation policy. Our clients include Fortune 500 companies, public companies of all sizes and privately held entities within the banking, financial services, health, technology, manufacturing, pharmaceutical, utilities, insurance and other industries. Our group includes former Internal Revenue Service officials who participated in many of the rulings and developed a number of regulations that affect executive compensation. Members of our practice also hold key leadership positions within national and state bar associations.
We work with clients to develop executive compensation strategies that attract, retain and reward key executives while also protecting the best interests of shareholders. In light of increasing public scrutiny and the changing legal environment, corporate governance issues are an important consideration when establishing internal processes and structures. We provide effective guidance on change-in-control protection, compensation committee governance, executive employment agreements, equity compensation and stock options, incentive compensation, non-qualified deferred compensation, public disclosures, Section 16 reporting and split-dollar life insurance.
Our executive compensation lawyers regularly negotiate and draft employment agreements that meet the needs of employers and executives. We draw on our deep knowledge of industry best practices and standards, and have broad experience representing public companies and privately held businesses in the financial services, utilities, health care, technology and manufacturing sectors. We help clients address complex legal and business considerations relating to executive non-competition restrictions, confidentiality provisions, dispute resolution procedures and liquidated damage clauses, as well as severance and deferred compensation obligations that may represent significant financial commitments in the context of business acquisitions, mergers, divestitures and changes in control.
We regularly assist public, privately held and limited liability companies and other clients in designing equity compensation arrangements that meet key incentive and retention goals. We coordinate solutions to a range of tax, securities and accounting considerations, including qualifying for incentive stock options and Section 162(m) deduction rules for named executive officers, registering equity investments for public companies, securing exemptions for private companies, and ensuring accurate compensation expense reporting. Our experience includes all forms of stock options, restricted stock, stock appreciation rights, phantom stock, deferred issuance stock awards, stock purchase programs, use of equity derivatives and conversion of equity compensation into deferred compensation. We also advise clients regarding use of equity compensation for estate planning, clawback provisions for non-competes, and divorce decrees.
To help employers address the complicated challenges that arise when providing benefits to executives in different countries, our executive compensation team provides full-spectrum guidance on international and domestic tax, employment, labor and privacy laws. We work with clients to harmonize compliance between existing practices in the executive’s home country and foreign laws that are at times inconsistent with domestic requirements. Our lawyers negotiate and establish special arrangements for retirement benefits, social security coverage (totalization agreements), equity compensation and other benefits, and counsel multinational companies on issues involving stock option grants, approvals for deferred compensation, employment agreements involving multiple jurisdictions, and foreign tax deductions under Section 404A.
Non-Qualified Deferred Compensation
We help clients structure and establish a range of non-qualified deferred compensation plans that help executives accumulate meaningful retirement benefits beyond those allowed under more restrictive, traditional tax-qualified profit sharing and pension plans. We address risks such as changes in control, help clients ensure compliance with ERISA and constructive receipt rules, expanded coverage for employees, and emerging tax regulations, and influence the development of legislation, including recent proposals to restrict executive access to deferred compensation funds and the means by which a company may fund payment for future plan benefits. Our lawyers also advise tax-exempt clients on Section 457 limits and other federal tax rules that apply to exempt organizations.
We help clients ensure compliance with the full range of Securities and Exchange Commission rules that affect executive compensation, perquisite and personal benefits arrangements, including required disclosures and reports (such as Form 10-K and Form 8-K reports and registration, proxy and information statements), related-person transactions and corporate governance requirements. We work with clients to identify and establish disclosure teams, help educate team members, executives, directors and officers on disclosure requirements and timeframes, conduct inventories of perquisites and compensation, evaluate board independence, and review and modify committee charter amendments, policies for stock option and other equity grants, and related processes.
Split-Dollar Life Insurance
Public companies, privately held businesses and tax-exempt organizations that provide split-dollar life insurance to their executives must ensure compliance with a number of Internal Revenue Service rules and related federal and state legislation. Together with experienced lawyers from the Firm’s tax, insurance and estate-planning practices, our employee benefits lawyers provide sophisticated split-dollar planning to a number of publicly held and other clients. We help clients evaluate alternatives for premium payments and to personal loan prohibitions, offer diagnostic reviews of corporate split-dollar programs, including group-carve out arrangements, SERP-swaps and “equity” split-dollar life insurance arrangements, and help identify new opportunities as regulatory requirements and financial markets evolve.