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  • 1.

    Provide an overview of the primary sources of law, regulation and practice that govern or affect executive compensation arrangements or employee benefits.

  • 2.

    What are the primary government agencies or other entities responsible for enforcing these rules?

  • 3.

    Are any types of compensation or benefits generally subject to specific corporate governance requirements or approval by shareholders or government?

  • 4.

    Under what circumstances does the establishment or change of an executive compensation or benefit arrangement generally require consultation with a union, works council or similar body?

  • 5.

    Are any types of compensation or benefit arrangements prohibited either generally or with senior management?

  • 6.

    What rules apply to compensation of non-executive directors?

  • 7.

    Must any aspects of an executive’s compensation be publicly disclosed or disclosed to the government?

  • 8.

    Are employment agreements required or prevalent? If so, what provisions are common?

  • 9.

    What are the prevalent types and structures of incentive compensation? Do they vary by level or type of organisation?

  • 10.

    Are there limits generally on the amount or structure of incentive compensation? Are there limits that adversely affect the tax treatment of the employer or the executive?

  • 11.

    Is deferral and vesting of incentive awards permissible? Are there limits on the length or type of vesting and deferral provisions?

  • 12.

    Can it be held that recurrent discretionary incentive compensation has become a mandatory contractual entitlement?

  • 13.

    Does the type or amount of incentive compensation awarded to an executive potentially affect the compensation that must be awarded to other executives or employees?

  • 14.

    Is it permissible to require repayment of incentive compensation under certain circumstances? Are there circumstances under which such repayment is mandatory?

  • 15.

    What are the prevalent forms of equity compensation awards in your jurisdiction? What is a typical vesting period?

  • 16.

    Are there forms of equity compensation that are tax-advantageous or disadvantageous to employees or employers?

  • 17.

    Does equity-based compensation require registration or notice? Are exemptions, or simplified or expedited procedures available?

  • 18.

    Are there withholding tax requirements for equity-based awards?

  • 19.

    Are inter-company chargeback agreements between a non-local parent company and local affiliate common? What issues arise?

  • 20.

    Are employee stock purchase plans prevalent or available? If so, are there any frequently encountered issues with such arrangements?

  • 21.

    Are there any mandatory benefits? Are there limits on discontinuing voluntary benefits that have been provided?

  • 22.

    What types of employee benefits are prevalent for executives? Are there tax or other financial incentives or disincentives for any employee benefit arrangements?

  • 23.

    Are there prohibitions on terminating executives? Are there required notice periods? May executives be dismissed without cause?

  • 24.

    Are there statutory or mandatory minimum severance requirements in your jurisdiction? Are there any other mandatory, post-employment benefits?

  • 25.

    What executive severance payment level is typical?

  • 26.

    Are there limits on dismissal for ‘cause’? Are there any statutory limits on ‘constructive dismissal’ or ‘good reason’? How are ‘cause’ or ‘constructive dismissal’ defined?

  • 27.

    Are ‘gardening leave’ provisions typically used in employment terminations?

  • 28.

    Is a general waiver or release of claims on termination of an executive’s employment normally permitted? Are there any restrictions or requirements for the waiver or release to be enforceable?

  • 29.

    What post-employment restrictive covenants are prevalent? What are the typical restricted periods?

  • 30.

    Are there limits on, or requirements for, post-employment restrictive covenants to be enforceable? Will a court typically modify a covenant to make it enforceable?

  • 31.

    What remedies can the employer seek for breach of post-employment restrictive covenants?

  • 32.

    Are there any required pension or other retirement benefits? Are there limits on discontinuing voluntary benefits that have been provided?

  • 33.

    What types of pension or other retirement benefits are prevalent for executives? Are there tax or other financial incentives or disincentives for any employee benefit arrangements?

  • 34.

    May executives receive supplemental retirement benefits?

  • 35.

    May an executive be indemnified or insured for claims related to actions taken as an executive, officer or director?

  • 36.

    Under what circumstances will an asset sale in your jurisdiction result in an automatic transfer of benefit obligations to the acquirer?

  • 37.

    Is it customary to provide for executive retention or related arrangements in connection with a change in control?

  • 38.

    Are there limits or prohibitions on the acceleration of vesting or exercisability of compensation in a change in control? Are there restrictions on ‘cashing-out’ equity awards?

  • 39.

    Do foreign exchange controls rules apply to the remittance of funds, or the transfer of employer equity or equity-based awards to executives?

  • 40.

    Must employment agreements, employee compensation or benefit plans, or award agreements be translated into the local language?

  • 41.

    Are there prohibitions on tax gross-up, tax indemnity or tax equalisation payments?

  • 42.

    Are choice-of-law provisions in executive employment contracts generally respected?

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Sullivan & Cromwell LLP provides the highest quality legal advice and representation to clients around the world. The results the firm achieves have set it apart for more than 130 years and have become a model for the modern practice of law.

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NY 10004-2498
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