Strong Written Agreement Key in Change in Control Agreement
// Dallas, Texas, United States // Attorney Keith Clouse (Blog) // Keith Clouse
A change in control agreement (also known as a golden parachute) guides employment issues for an executive whose employer is purchased by another company. For example, an executive enters into an employment agreement that contains a change in control provision with Widget World. Five years later, Acme Widgets purchases Widget World. This purchase triggers the change in control provisions in the executive’s contract with Widget World.
Because a change in control agreement is negotiated between the executive and his current employer but enforced against a different employer, disputes often arise over the interpretation of these agreements. That’s why Dallas executive employment lawyer Keith Clouse believes that an executive must aim for an agreement that is clearly drafted and leaves little open to interpretation. The executive must carefully define key terms, such as “material diminution of duties” and “material reduction in compensation,” so that the executive can easily prove his new employer triggered the pay-out clauses under the change in control agreement.
This article is presented by the Dallas employment attorneys at Clouse Dunn LLP. To speak to an employment lawyer about an executive compensation or a change in control agreement, send an email to debra@clousedunn.com or call (214) 239-2705.
Contact Keith Clouse
KEITH A. CLOUSE
Clouse Dunn LLP
214.220.2722 214.220.3833 ( fax) keith@clousedunn.com
