Corporate executives and senior executives (“D&O`s”) are exposed to considerable personal risk when their company is involved in litigation or investigation. That`s why prudent D&O`s use all available legal safeguards, including charter agreements, insurance, and indemnification agreements. If well structured, these agreements offer broad protection, so individuals have the right to hire a lawyer at the company`s expense from the moment they need protection, whether because they are under investigation (even informal) by a supervisory authority, are accused of misconduct or are called to testify in a case. But in addition to statutory benefits, compensation agreements offer psychological benefits that cannot be provided by generally applicable legal, statutory or statutory provisions. Indemnification agreements offer the security that goes hand in hand with the maximum legally possible protection for D&O`s. If you are or will be a business administrator or senior executive, contact a qualified advisor for the development and negotiation of a compensation agreement tailored to you and your business. Readers who want to learn more about indemnification agreements in writing want to read the May 26, 2015 article on the Securities Matters blog of the law firm Mintz Levin (here), which details the importance of a separate written indemnification agreement for corporate executives and discusses the main features that this type of agreement should contain. Here you will find an old memo from the law firm Alston & Bird, which deals with indemnification and development in general and the need for written indemnification agreements in particular. If you`re a senior executive or director of a limited company (or a large private company), it`s never been more important to make sure you have an aggressive personal compensation agreement. Procedure and timetable. A compensation agreement usually includes procedures and deadlines that clarify and strengthen the rights of those compensated. For example, the agreement may require the company to control, when paying a fee against the beneficiary of the compensation, certain transaction conditions favourable to the director, such as.B. an unconditional exemption from any obligation related to the procedure and a confirmation that the beneficiary refuses any fault.
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