The Advisors' Blog

This blog features wisdom from respected compensation consultants and lawyers

June 2, 2021

Chart: How Deal Structure Affects Pay Arrangements

This Foley & Lardner blog explains how three typical deal structures – stock purchase, asset purchase, and carve-out – affect executive comp & employee benefits strategies. For each type of transaction, the chart shows:

1. Will the benefit plans & compensation arrangements come with the transaction?

2. Will employees and employment agreements come with the transaction?

3. What happens to the 401(k) plan?

4. What happens to non-qualified retirement plans?

5. What happens to equity awards?

6. Does the structure impact how/whether Code Section 280G (“golden parachute rules”) applies?

7. What happens to group health plans?

8. What about flexible spending accounts (FSAs)?

9. What about accrued vacation or bonus liabilities?

Liz Dunshee

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