Following on from a recent post about Internal Revenue Code Section 409(a), which significantly changes the way non-qualified deferred compensation plans are treated for income tax purposes, I thought it would be helpful to provide some additional examples of recent contract documents and language that dealt with the issue. I had previously posted two examples of employment agreements which incorporated language around section 409(a), and I’ve attached the following example documents as well:
- Smith & Wollensky Restaurant Group Change in Control Protection Plan – the plan appears to be largely built around 409(a) compliance. This is also available online along with many other change of control agreements.
- Thoratec Separation Benefits Agreement - this document lays out, for a specific individual, how various components of deferred compensation and severance benefits may be altered to ensure Section 409(a) compliance
- Loews Corp Stock Option Plan - this document, recently filed with the SEC, incorporates specific language to make the plan compliant with IRC 409(a). Thousands of these stock option plans and employee benefits plans are easily searchable online at www.RealDealDocs.com.
The ability to quickly find specific contract language about changing tax or legal requirements can be invaluable in understanding how to deal with these issues, particularly when the documents have been drafted by well-respected law firms. I hope you find these helpful.
