[{"data":1,"prerenderedAt":527},["ShallowReactive",2],{"document-deferred-compensation-agreement-D13830":3},{"document":4,"label":23,"preview":11,"thumb":24,"thumb600":25,"description":5,"descriptionCustom":6,"apiDescription":5,"pages":8,"extension":10,"parents":26,"breadcrumb":30,"related":38,"customDescModule":174,"customdescription":6,"mdFm":175,"mdProseHtml":526},{"description":5,"descriptionCustom":6,"label":7,"pages":8,"size":9,"extension":10,"preview":11,"thumb":12,"svgFrame":13,"seoMetadata":14,"parents":16,"keywords":15},"DEFERRED COMPENSATION AGREEMENT This Deferred Compensation Agreement (the \"Agreement\") is entered into effect as of [DATE], BETWEEN: [COMPANY NAME], (\"Company\"), a corporation organized and existing under the laws of the [State/Province] of [STATE/PROVINCE], with its head office located at: [COMPLETE ADDRESS] AND: [EMPLOYEE/RECIPIENT NAME], (\"Employee\") an individual with their main address located at: [COMPLETE ADDRESS] PURPOSE OF AGREEMENT 1.1 The Company and the Employee acknowledge and agree that this Agreement is established to provide a deferred compensation arrangement for the Employee as a form of nonqualified deferred compensation. This Agreement is designed to outline the terms and conditions of the deferred compensation arrangement. DEFERRED COMPENSATION AMOUNT 2.1 The Company agrees to defer a portion of the Employee's compensation in accordance with the terms and conditions specified in Exhibit A attached hereto. Exhibit A includes details about the deferred compensation amount, the timing of deferral, and any additional terms agreed upon by the Parties. VESTING AND DISTRIBUTION 3.1 The deferred compensation shall vest in accordance with the vesting schedule outlined in Exhibit A. 3.2 The distribution of the deferred compensation to the Employee shall occur as detailed in Exhibit A",null,"Deferred Compensation Agreement","3",513,"doc","https://templates.business-in-a-box.com/imgs/1000px/deferred-compensation-agreement-D13830.png","https://templates.business-in-a-box.com/imgs/250px/13830.png","https://templates.business-in-a-box.com/svgs/docviewerWebApp1.html?v6#13830.xml",{"title":15,"description":6},"deferred compensation agreement",[17,20],{"label":18,"url":19},"Human Resources","/templates/human-resources/",{"label":21,"url":22},"Hire an Employee","/templates/hire-employee/","Deferred Compensation Agreement Template","https://templates.business-in-a-box.com/imgs/400px/13830.png","https://templates.business-in-a-box.com/imgs/600px/13830.png",[27,17,20],{"label":28,"url":29},"Templates","/templates/",[31,32,35],{"label":28,"url":29},{"label":33,"url":34},"Legal Agreements","/templates/business-legal-agreements/",{"label":36,"url":37},"Employment & Contractors","/templates/employment-and-contractors/",[39,43,47,51,55,59,63,67,71,75,79,83,87,104,119,132,146,160],{"label":40,"url":41,"thumb":42,"extension":10},"Compensation Agreement","/template/compensation-agreement-D13258","https://templates.business-in-a-box.com/imgs/250px/13258.png",{"label":44,"url":45,"thumb":46,"extension":10},"Stock Compensation Agreement","/template/stock-compensation-agreement-D14066","https://templates.business-in-a-box.com/imgs/250px/14066.png",{"label":48,"url":49,"thumb":50,"extension":10},"Compensation and Benefits Policy","/template/compensation-and-benefits-policy-D13629","https://templates.business-in-a-box.com/imgs/250px/13629.png",{"label":52,"url":53,"thumb":54,"extension":10},"Checklist Worker's Compensation Claims","/template/checklist-worker-s-compensation-claims-D475","https://templates.business-in-a-box.com/imgs/250px/475.png",{"label":56,"url":57,"thumb":58,"extension":10},"Request for Instructions on Deferred Collections","/template/request-for-instructions-on-deferred-collections-D228","https://templates.business-in-a-box.com/imgs/250px/228.png",{"label":60,"url":61,"thumb":62,"extension":10},"Apology and Tender of Compensation","/template/apology-and-tender-of-compensation-D1288","https://templates.business-in-a-box.com/imgs/250px/1288.png",{"label":64,"url":65,"thumb":66,"extension":10},"Compensation and Benefits Manager Job Description","/template/compensation-and-benefits-manager-job-description-D11635","https://templates.business-in-a-box.com/imgs/250px/11635.png",{"label":68,"url":69,"thumb":70,"extension":10},"Board Resolution Approving Compensation for Board of Directors","/template/board-resolution-approving-compensation-for-board-of-directors-D39","https://templates.business-in-a-box.com/imgs/250px/39.png",{"label":72,"url":73,"thumb":74,"extension":10},"Non-Profit Partnership Agreement","/template/non-profit-partnership-agreement-D14023","https://templates.business-in-a-box.com/imgs/250px/14023.png",{"label":76,"url":77,"thumb":78,"extension":10},"Indemnification Agreement For Directors","/template/indemnification-agreement-for-directors-D480","https://templates.business-in-a-box.com/imgs/250px/480.png",{"label":80,"url":81,"thumb":82,"extension":10},"Severance Pay Agreement","/template/severance-pay-agreement-D12863","https://templates.business-in-a-box.com/imgs/250px/12863.png",{"label":84,"url":85,"thumb":86,"extension":10},"Severance Agreement (over 40)","/template/severance-agreement-over-40-D12862","https://templates.business-in-a-box.com/imgs/250px/12862.png",{"description":88,"descriptionCustom":6,"label":89,"pages":90,"size":9,"extension":10,"preview":91,"thumb":92,"svgFrame":93,"seoMetadata":94,"parents":96,"keywords":95,"url":103},"EMPLOYMENT AGREEMENT - AT WILL EMPLOYEE This Employment Agreement for \"At Will\" Employee (the \"Agreement\") is made and effective this [DATE], BETWEEN: [EMPLOYEE NAME] (the \"Employee\"), an individual with his main address at: [COMPLETE ADDRESS] AND: [YOUR COMPANY NAME] (the \"Corporation\"), an entity organized and existing under the laws of the [State/Province] of [STATE/PROVINCE], with its head office located at: [YOUR COMPLETE ADDRESS] RECITALS In consideration of the covenants and agreements herein contained and the moneys to be paid hereunder, the Corporation hereby employs the Employee and the Employee hereby agrees to perform services as an employee of the Corporation, on an \"at will\" basis, upon the following terms and conditions: APPOINTMENT The Employee is hereby employed by the Corporation to render such services and to perform such tasks as may be assigned by the Corporation. The Corporation may, in its sole discretion, increase or reduce the duties, or modify the title and job description, of the Employee from time to time, and any such increase, reduction or modification shall not be deemed a termination of this Agreement. ACCEPTANCE OF EMPLOYMENT Employee accepts employment with the Corporation upon the terms set forth above and agrees to devote all Employee's time, energy and ability to the interests of the Corporation, and to perform Employee's duties in an efficient, trustworthy and business-like manner. DEVOTION OF TIME TO EMPLOYMENT The Employee shall devote the Employee's best efforts and substantially all of the Employee's working time to performing the duties on behalf of the Corporation. The Employee shall provide services during the hours that are scheduled by the Corporation management. The Employee shall be prompt in reporting to work at the assigned time. NO CONFLICT OF INTEREST Employee shall not engage in any other business while employed by the Corporation. Employee shall not engage in any activity that conflicts with the Employees duties to the Corporation. Employee shall not provide any service or lend any aid or assistance to any party that competes with the services offered by the Corporation. Employee shall not provide any services to clients or prospective clients of the Corporation outside of the provision of services for the Corporation, whether such services are provided with or without compensation or remuneration. CORPORATION PROPERTY Employee acknowledges and agrees that while employed by the Corporation the Employee may be provided with use of computer equipment and other property of the Corporation. The use and possession of the such items shall be subject to any policies, requirements or restrictions established by the Corporation. Such items may only be used in performance of the Employee's duties for the corporation. On request of the Corporation, the Employee shall immediately deliver any such items to the Corporation. Upon termination of employment, Employee shall have the affirmative duty to return any such item to the Corporation whether a request is made or not. The obligation to return Corporation property shall extend and include any and all work product, client property, proprietary rights, intangible property, and all other property of the corporation regardless of the form or medium. COMPENSATION The Corporation shall pay the Employee such hourly compensation as determined by the Corporation. Payment shall be at the same time as the Corporations usual payroll to other employees. BONUS & BENEFITS Payment of any bonuses shall be at the complete discretion of the Corporation. No guarantee or representation that any bonuses will be paid has been made to the Employee. Standard benefits that are provided to other non-management employees shall be offered to the Employee, subject to the Corporation's policies and the terms and conditions of such benefits. WITHHOLDING All sums payable to Employee under this Agreement will be reduced by all federal, state, local, and other withholdings and similar taxes and payments required by applicable law. QUALIFICATIONS OF EMPLOYEE The employee shall satisfy all of the qualification that are established by the Corporation. TERM OF AGREEMENT There shall be no guaranteed term of employment. Employer acknowledges and agrees that Employee shall be an \"At Will\" Employee and that Employee's employment may be terminated at any time by the Corporation, with or without cause. FEES FROM EMPLOYEE'S WORK The Corporation shall have exclusive authority to determine the fees, or a procedure for establishing the fees, to be charged to clients by the Corporation for services that are provided by the Employee. All sums paid to the Employee or the Corporation in the way of fees, in cash or in kind, or otherwise for services of the Employee, shall, except as otherwise specifically agreed by the Corporation, be and remain the property of the Corporation and shall be included in the Corporation's name in such checking account or accounts as the Corporation may from time to time designate. CLIENTS AND CLIENT RECORDS The Corporation shall have the authority to determine who will be accepted as clients of the Corporation, and the Employee recognizes that such clients accepted are clients of the Corporation and not the Employee. All client records and files of any type concerning clients of the Corporation shall belong to and remain the property of the Corporation, notwithstanding the subsequent termination of the employment. POLICIES AND PROCEDURES The Corporation shall have the authority to establish from time to time the policies and procedures to be followed by the Employee in performing services for the Corporation. This may include, but is not necessarily limited to, employment policies, computer use policies, Internet access policies, email policies, and all other policies, procedures, directives, and mandates established by the Corporation, whether or not in written form or formally adopted. Employee shall abide by the provisions of any contract entered into by the Corporation under which the Employee provides services. Employee shall comply with the terms and conditions of any and all contracts entered by the Corporation. TERMINATION Employee acknowledges and agrees that Employee is an \"at will\" employee of the Corporation. As such, no term of employment is created hereby and employee may be terminated at any time in the sole discretion of the Corporation, whether there exists any cause for termination or not. CREATIONS AND INVENTIONS Employee acknowledges and agrees that any and all work product of the Employee that is conceived or created during the Employee's employment with the Corporation is the exclusive property of the Corporation. This shall include any and all copyrights, trade secrets, confidential information, patents, trademarks, trade dress, ideas, concepts, plans, business plans, business concepts, techniques, inventions, drawings, artwork, logos, graphics, web pages, databases, software, programs, CGI's, plug ins, applications, brochures, inventions, marketing plans and concepts, and all other ideas and work product of the Employee. The Employee acknowledges and agrees that all creations shall be \"works made for hire\" as defined in the [ACT OR CODE]. Notwithstanding the fact that this material may be considered to be a work made for hire, Employee agrees, during Employee's employment and thereafter, which covenant shall survive any termination of the employment relationship, to execute any and all documents requested by the Corporation to confirm the Corporation's ownership and control of all such material, including but not limited to assignments of copyright, confirmations of work for hire status, waivers of proprietary rights, copyright application, and any other documents requested by Corporation. RESTRICTIVE COVENANTS","Employment Agreement_At Will Employee","7","https://templates.business-in-a-box.com/imgs/1000px/employment-agreement_at-will-employee-D541.png","https://templates.business-in-a-box.com/imgs/250px/541.png","https://templates.business-in-a-box.com/svgs/docviewerWebApp1.html?v6#541.xml",{"title":95,"description":6},"employment agreement_at will employee",[97,99,101],{"label":18,"url":98},"human-resources",{"label":21,"url":100},"hire-employee",{"label":33,"url":102},"business-legal-agreements","/template/employment-agreement_at-will-employee-D541",{"description":105,"descriptionCustom":6,"label":106,"pages":107,"size":108,"extension":10,"preview":109,"thumb":110,"svgFrame":111,"seoMetadata":112,"parents":113,"keywords":117,"url":118},"EMPLOYMENT AGREEMENT FOR AN EXECUTIVE This Employment Agreement for an Executive (the \"Agreement\") is made and effective this [Date], BETWEEN: [EXECUTIVE NAME] (the \"Executive\"), an individual with his main address at: AND: [COMPANY NAME] (the \"Company\"), an entity organized and existing under the laws of the [STATE/PROVINCE], with its head office located at: Recitals In consideration of the covenants and agreements herein contained and the moneys to be paid hereunder, the Company hereby employs the Executive and the Executive hereby agrees to perform services as an Executive of the Company, upon the following terms and conditions: TERM The Company hereby employs Executive to serve as [position] and to serve in such additional or different position or positions as the Company may determine in its sole discretion. The term of employment shall be for a period of [NUMBER] years (\"Employment Period\") to commence on [DATE], unless earlier terminated as set forth herein. The effective date of this Agreement shall be the date first set forth above, and it shall continue in effect until the earlier of: The effective date of any subsequent employment agreement between the Company and the Executive; The effective date of any termination of employment as provided elsewhere herein; or [NUMBER] year(s) from the effective date hereof, provided, that this Employment Agreement shall automatically renew for successive periods of [NUMBER] years each unless either party gives written notice to other that it does not wish to automatically renew this Agreement, which written notice must be received by the other party no less than [NUMBER] days and no more than [NUMBER] days prior to the expiration of the applicable term. Duties and Responsibilities Executive will be reporting to [IDENTIFY]. Within the limitations established by the By-laws of the Company, the Executive shall have each and all of the duties and responsibilities of that position and such other or different duties on behalf of the Company, as may be assigned from time to time by [identify what person or body may assign additional responsibilities]. Location The initial principal location at which Executive shall perform services for the Company shall be [location]. Acceptance of Employment Executive accepts employment with the Company upon the terms set forth above and agrees to devote all Executive's time, energy and ability to the interests of the Company, and to perform Executive's duties in an efficient, trustworthy and business-like manner. Devotion of Time to Employment The Executive shall devote the Executive's best efforts and substantially all of the Executive's working time to performing the duties on behalf of the Company. The Executive shall provide services during the normal business hours of the Company as determined by the Company. Reasonable amounts of time may be allotted to personal or outside business, charitable and professional activities and shall not constitute a violation of this Agreement provided such activities do not materially interfere with the services required to be rendered hereunder. QUALIFICATIONS The Executive shall, as a condition of this Agreement, satisfy all of the qualification that are reasonably and in good faith established by the Board of Directors. Compensation Base Salary Executive shall be paid a base salary (\"Base Salary\") at the annual rate of [salary], payable in bi-weekly installments consistent with Company's payroll practices. The annual Base Salary shall be reviewed on or before [DATE] of each year, unless Executive's employment hereunder shall have been terminated earlier pursuant to this Agreement, starting on [agreed upon date] by the Board of Directors of the Company to determine if such Base Salary should be increased for the following year in recognition of services to the Company. In consideration of the services under this Agreement, Executive shall be paid the aggregate of basic compensation, bonus and benefits as hereinafter set forth. Payment Payment of all compensation to Executive hereunder shall be made in accordance with the relevant Company policies in effect from time to time, including normal payroll practices. Bonus From time to time, the Company may pay to Executive a bonus out of net revenues of the Company. Payment of any bonus compensation shall be at the sole discretion of the Board of Directors or the Executive committee of the Board of Directors and the Executive shall have no entitlement to such amount absent a decision by the Company as aforesaid to make such bonus compensation. Executive shall also be entitled to a bonus determined as follows: [DESCRIBE] Benefits The Company shall provide Executive with such benefits as are provided to other senior management Of the Company. Benefits shall include at a minimum (i) paid vacation of [NUMBER] days per year, at such times as approved by the Board of Directors, (ii) health insurance coverage under the same terms as offered to other Executives of the Company, (iii) retirement and profit sharing programs as offered to other Executives of the Company, (iv) paid holidays as per the Company's policies, and (v) such other benefits and perquisites as are approved by the Board of Directors. The Company has the right to modify conditions of participation, terminate any benefit, or change insurance plans and other providers of such benefits in its sole discretion. The Executive shall be reimbursed for out of pocket expenses that are pre-approved by the Company, subject to the Company's policies and procedures therefore, and only for such items that are a necessary and integral part of the Executive's job functions. NonDeductible Compensation In the event a deduction shall be disallowed by the Internal Revenue Service or a court of competent jurisdiction for federal income tax purposes for all or any part of the payment made to Executive by the Company or any other shareholder or Executive of the Company, shall be required by the Internal Revenue Service to pay a deficiency on account of such disallowance, then Executive shall repay to the Company or such other individual required to make such payment, an amount equal to the tax imposed on the disallowed portion of such payment, plus any and all interest and penalties paid with respect thereto. The Company or other party required to make payment shall not be required to defend any proposed disallowance or other action by the Internal Revenue Service or any other state, federal, or local taxing authorities. Withholding All sums payable to Executive under this Agreement will be reduced by all federal, state, local, and other withholdings and similar taxes and payments required by applicable law. Other Employment Benefits Business Expenses Upon submission of itemized expense statements in the manner specified by the Company, Executive shall be entitled to reimbursement for reasonable travel and other reasonable business expenses duly incurred by Executive in the performance of his duties under this Agreement. Benefit Plans Executive shall be entitled to participate in the Company's medical and dental plans, life and disability insurance plans and retirement plans pursuant to their terms and conditions. Executive shall be entitled to participate in any other benefit plan offered by the Company to its Executives during the term of this Agreement (other than stock option or stock incentive plans, which are governed by Section 3(d) below). Nothing in this Agreement shall preclude the Company or any affiliate of the Company from terminating or amending any Executive benefit plan or program from time to time. Vacation Executive shall be entitled to [agreed upon number of time] weeks of vacation each year of full employment, exclusive of legal holidays, as long as the scheduling of Executive's vacation does not interfere with the Company's normal business operations.","Employment Agreement Executive","12",97,"https://templates.business-in-a-box.com/imgs/1000px/employment-agreement_executive-D543.png","https://templates.business-in-a-box.com/imgs/250px/543.png","https://templates.business-in-a-box.com/svgs/docviewerWebApp1.html?v6#543.xml",{"title":6,"description":6},[114,115,116],{"label":18,"url":98},{"label":21,"url":100},{"label":33,"url":102},"employment agreement executive","/template/employment-agreement-executive-D543",{"description":120,"descriptionCustom":6,"label":121,"pages":122,"size":9,"extension":10,"preview":123,"thumb":124,"svgFrame":125,"seoMetadata":126,"parents":128,"keywords":127,"url":131},"STOCK OPTION PLAN This Stock Option Plan (the \"Plan\") is given by [COMPANY NAME] (the \"Company\"), having its registered office at [SPECIFY ADDRESS] to its Employees. This Plan was approved and adopted by the Board of Directors and by the stockholders on [DATE]. STATEMENT OF PURPOSE [COMPANY NAME] has formulated this Plan, in furtherance of the corporate policy of the Company, for creating an environment conducive to higher growth opportunities for its Employees and the Employees of its Affiliates, and with a view to align the interests of such Employees and those of the shareholders by creating a common sense of purpose towards creating sustainable shareholder value. DEFINITIONS Administrator shall mean the Compensation Committee of the Board (or a subcommittee thereof) acting in its capacity as Administrator of the Plan. Applicable Laws shall mean the legal requirements related to the Plan and the option under applicable provisions of the securities laws of [STATE/PROVINCE]. Board shall mean the Company's Board of Directors. Company shall mean [NAME OF COMPANY]. Option Shares shall mean the number of shares of Common Stock subject to the option as specified in the attached Exhibit A. Optionee shall mean the person eligible to avail the Stock Option Plan. Permanent Disability shall mean the inability of the Optionee to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which is expected to result in death or to be of continuous duration of [NUMBER OF MONTHS] months or more. Plan shall mean this Stock Option Plan. GRANT OF OPTION The Company hereby grants to the eligible person (the \"Optionee\") an option to purchase shares of Common Stock under the Plan. The date on which this option is granted (the \"Grant Date\"), the number of shares of Common Stock purchasable under this option (the \"Option Shares\"), the exercise price payable per share (the \"Exercise Price\"), the applicable vesting schedule by which this option shall vest and become exercisable incrementally for the Option Shares (the \"Vesting Schedule\") and the date to be used to measure the maximum term of this option (the \"Expiration Date\") are indicated on the attached Exhibit A to this Plan. The remaining terms and conditions governing this option shall be as set forth in this Plan. ELIGIBILITY FOR THE GRANT OF OPTIONS The criteria to be fulfilled by an Employee for being considered an Eligible Employee may be prescribed by the Committee from time to time. Only Employees fulfilling such criteria and who are not Disqualified Employees shall be considered Eligible Employees for the purposes of this Plan. An option can be granted only to an Eligible Employee who has been selected by the Committee. While selecting Eligible Employees for the award of grants and for deciding the number of options to be granted to such Eligible Employees, the Committee may be guided by the following considerations (i.e. eligibility criteria): Number of years of service Job profile and grade Performance rating or key result area appraisal Any other factors the Board of Directors or the Committee may deem appropriate. OPTION TERM The term of this option shall commence on the Grant Date and continue to be in effect until the close of business on the last business day prior to the Expiration Date specified in the attached Exhibit A, unless sooner terminated in accordance with this Plan. LIMITED TRANSFERABILITY This option shall be neither transferable nor assignable by the Optionee other than by will or the laws of inheritance following the Optionee's death and may be exercised, during the Optionee's lifetime, only by the Optionee. DATE OF EXERCISE This option shall vest and become exercisable for the Option Shares in a series of installments in accordance with the Vesting Schedule set forth in the attached Exhibit A. As the option vests and becomes exercisable for such installments, those installments shall accumulate, and the option shall remain exercisable for the accumulated installments until the last business day prior to the Expiration Date or any sooner termination of the option term. CESSATION OF SERVICE The option mentioned above shall terminate (and this option shall cease to be outstanding) prior to the Expiration Date should any of the following provisions become applicable: Except as otherwise expressly provided in subparagraphs 8.1.2 through 8.1.7 of this Paragraph 8, should the Optionee cease to remain in Continuous Service for any reason while this option is outstanding, then the Optionee shall have until the close of business on the last business day prior to the expiration of the [NUMBER OF MONTHS]-month period measured from the date of such cessation of Continuous Service during which to exercise this option for any or all of the Option Shares for which this option is vested and exercisable at the time of the Optionee's cessation of Continuous Service, but in no event shall this option be exercisable at any time after the close of business on the last business day prior to the Expiration Date. In the event the Optionee ceases Continuous Service by reason of his or her death while this option is outstanding, then this option may be exercised, for any or all of the Option Shares for which this option is vested and exercisable at the time of the Optionee's cessation of Continuous Service, by (i) the personal representative of the Optionee's estate or (ii) the person or persons to whom the option is transferred pursuant to the Optionee's will or the laws of inheritance following the Optionee's death. However, if the Optionee dies while holding this option and has an effective beneficiary designation in effect for this option at the time of his or her death, then the designated beneficiary or beneficiaries shall have the exclusive right to exercise this option following the Optionee's death. Any such right to exercise this option shall lapse, and this option shall cease to be outstanding, upon the close of business on the last business day prior to the earlier of (a) the expiration of the twelve (12)-month period measured from the date of the Optionee's death or (b) the Expiration Date. Upon the expiration of such limited exercise period, this option shall terminate and cease to be outstanding for any exercisable Option Shares for which the option has not otherwise been exercised. Should the Optionee cease Continuous Service by reason of Permanent Disability while this option is outstanding, then the Optionee shall have until the close of business on the last business day prior to the expiration of the twelve (12)-month period measured from the date of such cessation of Continuous Service during which to exercise this option for any or all of the Option Shares for which this option is vested and exercisable at the time of such cessation of Continuous Service. In no event, however, shall this option be exercisable at any time after the close of business on the last business day prior to the Expiration Date. Except as otherwise precluded by Applicable Laws, should (i) the Optionee cease Continuous Service after completion of at least three (3) years of Continuous Service and (ii) the sum of the Optionee's attained age and completed years of Continuous Service at the time of such cessation of service equals or exceeds seventy (70) years, then the Optionee shall have until the close of business on the last business day prior to the expiration of the thirty-six (36)-month period measured from the date of such cessation of Continuous Service during which to exercise this option for any or all of the Option Shares for which this option is vested and exercisable at the time of such cessation of Continuous Service. In no event, however, shall this option be exercisable at any time after the close of business on the last business day prior to the Expiration Date.","Stock Option Plan","9","https://templates.business-in-a-box.com/imgs/1000px/stock-option-plan-D13284.png","https://templates.business-in-a-box.com/imgs/250px/13284.png","https://templates.business-in-a-box.com/svgs/docviewerWebApp1.html?v6#13284.xml",{"title":127,"description":6},"stock option plan",[129,130],{"label":33,"url":102},{"label":33,"url":102},"/template/stock-option-plan-D13284",{"description":133,"descriptionCustom":6,"label":134,"pages":8,"size":9,"extension":10,"preview":135,"thumb":136,"svgFrame":137,"seoMetadata":138,"parents":140,"keywords":139,"url":145},"NON-DISCLOSURE AGREEMENT (NDA) This Non-Disclosure Agreement (the \"Agreement\") is made and effective [DATE], BETWEEN: [YOUR COMPANY NAME] (the \"Disclosing Party\"), a corporation organized and existing under the laws of the [State/Province] of [STATE/PROVINCE], with its head office located at: [YOUR COMPLETE ADDRESS] AND: [RECEIVING PARTY NAME] (the \"Receiving Party\"), an individual with his main address located at OR a corporation organized and existing under the laws of the [State/Province] of [STATE/PROVINCE], with its head office located at: [COMPLETE ADDRESS] WHEREAS, Receiving Party has been or will be engaged in the performance of work on [DESCRIBE]; and in connection therewith will be given access to certain confidential and proprietary information; and WHEREAS, Receiving Party and Disclosing Party wish to evidence by this Agreement the manner in which said confidential and proprietary material will be treated. NOW, THEREFORE, it is agreed as follows: NON-DISCLOSURE OF CONFIDENTIAL INFORMATION Both Parties understand and agree that each Party may have access to the confidential information of the other party. For the purposes of this Agreement, \"Confidential Information\" means proprietary and confidential information about the Disclosing Party's (or it's suppliers') business or activities. Such information includes all business, financial, technical, and other information marked or designated by such Party as \"confidential\" or \"proprietary.\" Confidential Information also includes information which, by the nature of the circumstances surrounding the disclosure, ought in good faith to be treated as confidential. For the purposes of this Agreement, Confidential Information does not include: Information that is currently in the public domain or that enters the public domain after the signing of this Agreement. Information a Party lawfully receives from a third Party without restriction on disclosure and without breach of a non-disclosure obligation. Information that the Receiving Party knew prior to receiving any Confidential Information from the Disclosing Party. Information that the Receiving Party independently develops without reliance on any Confidential Information from the Disclosing Party. Each Party agrees that it will not disclose to any third Party or use any Confidential Information disclosed to it by the other Party except when expressly permitted in writing by the other Party. Each Party also agrees that it will take all reasonable measures to maintain the confidentiality of all Confidential Information of the other Party in its possession or control. TERM The term of this Agreement is [number] of [years/months] from the date of execution by both Parties. TITLE The Receiving Party agrees that all Confidential Information furnished by the Disclosing Party shall remain the sole property of the Disclosing Party. DISCLAIMER","Non Disclosure Agreement Nda","https://templates.business-in-a-box.com/imgs/1000px/non-disclosure-agreement-nda-D12692.png","https://templates.business-in-a-box.com/imgs/250px/12692.png","https://templates.business-in-a-box.com/svgs/docviewerWebApp1.html?v6#12692.xml",{"title":139,"description":6},"non disclosure agreement nda",[141,142],{"label":33,"url":102},{"label":143,"url":144},"Confidentiality Agreements","confidentiality-agreement","/template/non-disclosure-agreement-nda-D12692",{"description":147,"descriptionCustom":6,"label":148,"pages":149,"size":150,"extension":10,"preview":151,"thumb":152,"svgFrame":153,"seoMetadata":154,"parents":155,"keywords":158,"url":159},"NON-COMPETE AGREEMENT This Non-Compete Agreement (the \"Agreement\") is made and effective [DATE], BETWEEN: FIRST PARTY NAME] (the \"First Party\"), a corporation organized and existing under the laws of the [State/Province] of [STATE/PROVINCE], with its head office located at: [COMPLETE ADDRESS] AND: [COMPANY NAME] (the \"Second Party\"), a corporation organized and existing under the laws of the [State/Province] of [STATE/PROVINCE], with its head office located at: [YOUR COMPLETE ADDRESS] FOR GOOD CONSIDERATION, the receipt of which is hereby acknowledged, the undersigned First party agrees not to compete with Second party, or its successors or assigns.","General Non-Compete Agreement","1",30,"https://templates.business-in-a-box.com/imgs/1000px/general-non-compete-agreement-D882.png","https://templates.business-in-a-box.com/imgs/250px/882.png","https://templates.business-in-a-box.com/svgs/docviewerWebApp1.html?v6#882.xml",{"title":6,"description":6},[156,157],{"label":33,"url":102},{"label":33,"url":102},"general non compete agreement","/template/general-non-compete-agreement-D882",{"description":161,"descriptionCustom":6,"label":162,"pages":90,"size":9,"extension":10,"preview":163,"thumb":164,"svgFrame":165,"seoMetadata":166,"parents":168,"keywords":167,"url":173},"EMPLOYEE SEPARATION AGREEMENT This Employee Separation Agreement (the \"Agreement\") is effective [DATE] (\"Effective Date\"), BETWEEN: [YOUR COMPANY NAME] (the \"Company\"), a company organized and existing under the laws of the [State/Province] of [STATE/PROVINCE] with its head office located at: [YOUR COMPLETE ADDRESS] AND: [SECOND PARTY NAME] (the \"Employee\"), an individual resident at: [COMPLETE ADDRESS] WHEREAS, the Company employed the Employee under an agreement of employment dated _________________________ [DATE] as ________________[Designation]; WHEREAS, the Company and the Employee hereby agree to terminate the employer-employee relationship effective as of _______________________ [Severance Date] (the \"Separation Date\"); WHEREAS, the Company and the Employee would like to settle any and all actual or potential differences and disputes between them related to such employer-employee relationship; WHEREAS the Parties wish to evidence their contract in writing; WHEREAS the Parties are duly authorized and have the capacity to enter into and perform this Agreement; WHEREAS both the Parties affirm to understand all the provisions contained in this Agreement, and in case either Party requires clarification as to one or more of the provisions contained herein, either Party has requested clarification or otherwise sought legal guidance. The Company and the Employee shall individually be referred as \"Party\" and collectively as \"Parties.\" IN CONSIDERATION OF COVENANTS AND AGREEMENTS CONTAINED HEREIN, THE PARTIES HERETO AGREE TO THE FOLLOWING TERMS AND CONDITIONS: DEFINITIONS \"Employment Agreement\" refers to the Agreement executed between the Employee and the Company outlining the rights, responsibilities, duties and employment conditions that make up the legal relationship between Company and Employee. \"Property\" refers to all the assets and products provided by the Company to the Employee to facilitate the Employee in furnishing its roles and responsibilities. \"Severance Payment\" refers to the total amount paid by the Company to its Employee which exceeds the minimum payments as prescribed by the applicable laws. \"Separation Date\" is the employment termination date for the Employee for all purposes. NATURE OF SEPARATION The Parties who previously entered into an Employment Agreement now hereby agree to discontinue the Employee's employment relationship with the Company, effective on ____________ (\"Separation Date\") in an amicable manner, according to the terms and conditions provided in this Agreement. TERMS AND CONDITIONS The Company agrees to make a single payment to the Employee in the amount of ________________ as Severance Payment. The amount shall be subject to appropriate taxes and other payroll deductions as required by law. The Employee shall be given ___ business days after the Separation Date to prepare for the transition of work to the new employee who will take over the duties and responsibilities. LIABILITIES The Employee hereby releases and forever discharges the Company as well as all partners, employees, directors, consultants, and insurers from any claim, demand, cause of action, obligations, damages, liabilities, and charges which may have arisen during the employment period. The Employee states they have not nor will they file a lawsuit for any of the following prior to or after this Agreement for: All laws regarding the discovery or claim of wrongful termination Violation of public policy All compensation claims including back wages, commission, front pay, pay increases, bonuses, disability benefits, retirement compensation, or reinstatement fees Personal injury claims including mental, physical, emotional, humiliation, or damage to name If the Employee files a lawsuit based on legal claims that the Employee has released, the Employee will pay for all costs incurred by the Company, any related companies or the directors or employees of any of them, including reasonable attorneys' fees, in defending against the Employee's claim. Nothing in this clause shall be construed or intended to waive or limit the Employee's rights to enforce all terms of this Agreement. Furthermore, the Company has not violated any legal obligations and has made no acceptance of such by entering these terms. All agreements including, but not limited to non-disclosure, non-compete, confidentiality and non-solicitation agreements shall remain in full force. Additionally, the Employee agrees not to release any information pertaining to the Company that may be considered confidential or may cause harm to the Parties mentioned. CONFIDENTIALITY AND NON-DISCLOSURE The Employee agrees to maintain the strict confidentiality of all Confidential Information during the term of this Agreement and for a period of [Confidentiality Period] thereafter. For purposes of this Agreement, \"Confidential Information\" shall mean all information and materials of the Company, and all information and materials received by the Company from third parties (including but not limited to affiliates, subsidiaries, chapters, and members of the Company), which are not generally publicly available, and all other information and materials which are of a proprietary or confidential nature, even if they are not marked as such. The Employee acknowledges that, as a result of his employment with the Company, certain trade secrets and other confidential information of the Company have been disclosed to him. The Employee agrees that, as partial consideration for this Agreement, that the Employee shall not disclose or utilize for his personal benefit, or for the direct or indirect benefit of any other person or entity, or for any other reason, any information, ideas, concepts, improvements, discoveries or other information, whether patentable or not, which have been disclosed to the Employee during the time the Employee was employed with the Company. In addition, all documents, notes, files, data, records, correspondence, manuals, specifications, computer programs, email, voice mail, electronic databases, maps and other writings or materials of any type which have been provided to the Employee as a result of the Employee's employment with or through the Company, are and shall be the sole and exclusive property of the Company. The Employee shall promptly deliver all such property, including copies, and the personal property listed on Exhibit \"A\" attached hereto, to the Company within five (5) business days of the date of this Agreement. This provision shall survive the termination of this Agreement indefinitely. INTELLECTUAL PROPERTY RIGHTS Ownership: The Employee agrees that all copyrights, trademarks, patents, and other intellectual property rights to works or marks arising in from or in connection with the Employee's employment by the Company are \"work made for hire\" and shall remain the sole and exclusive property of the Company. Assignment of Interest: To the extent any work product is not deemed to be a work made for hire, the Employee, with effect from the creation of all work product, hereby assigns, and agrees to assign, to the Company all right, title and interest in and to such work product, including but not limited to copyright, all rights subsumed thereunder, and all other intellectual property rights, including all extensions and renewals thereof. Moral Rights: The Employee also agrees to waive all moral rights relating to the work product, including but not limited to all rights of identification of authorship and any and all rights of approval, restriction or limitation on use, and subsequent modifications. Assistance: The Employee further agrees to provide all assistance reasonably requested by the Company, both during and after the term of this Agreement, in the establishment, preservation and enforcement of the Company's rights in the work product.","Employee Separation Agreement","https://templates.business-in-a-box.com/imgs/1000px/employee-separation-agreement-D12842.png","https://templates.business-in-a-box.com/imgs/250px/12842.png","https://templates.business-in-a-box.com/svgs/docviewerWebApp1.html?v6#12842.xml",{"title":167,"description":6},"employee separation agreement",[169,170],{"label":18,"url":98},{"label":171,"url":172},"Employee Termination","employee-termination","/template/employee-separation-agreement-D12842",false,{"seo":176,"reviewer":187,"legal_disclaimer":191,"quick_facts":192,"at_a_glance":194,"personas":198,"variants":223,"glossary":251,"clauses":285,"how_to_fill":336,"common_mistakes":377,"faqs":402,"industries":430,"comparisons":455,"diy_vs_lawyer":469,"jurisdictions":482,"related_template_ids_curated":503,"schema":514,"classification":515},{"meta_title":177,"meta_description":178,"primary_keyword":179,"secondary_keywords":180},"Deferred Compensation Agreement Template (Free Word)","Free deferred compensation agreement template for employers and executives. Covers vesting, payout triggers, forfeiture, and tax compliance. Free Word and PDF download.","deferred compensation agreement template",[15,181,182,183,184,185,186],"deferred compensation plan template","executive deferred compensation agreement","nonqualified deferred compensation agreement","deferred compensation contract template","deferred compensation agreement word","deferred compensation agreement free download",{"name":188,"credential":189,"reviewed_date":190},"Bruno Goulet","CEO, Business in a Box","2026-05-02",true,{"difficulty":193,"legal_review_recommended":191,"signature_required":191,"notarization_required":174},"advanced",{"what_it_is":195,"when_you_need_it":196,"whats_inside":197},"A Deferred Compensation Agreement is a legally binding contract between an employer and an employee — typically an executive or key employee — under which a portion of earned compensation is set aside and paid out at a future date rather than when earned. This free Word download gives you a structured, attorney-reviewed starting point covering deferral elections, vesting schedules, payout triggers, forfeiture conditions, and tax compliance language you can edit online and export as PDF.\n","Use it when offering a senior hire or existing executive a supplemental retention incentive tied to future performance or tenure, when structuring a bonus deferral program for key employees, or when replacing informal compensation promises with an enforceable written agreement.\n","Deferral amount and election mechanics, vesting schedule, permissible distribution triggers, forfeiture and clawback provisions, funding and rabbi-trust arrangements, tax compliance language referencing IRC Section 409A, change-of-control treatment, and governing law.\n",[199,203,207,211,215,219],{"title":200,"use_case":201,"icon_asset_id":202},"HR directors and compensation managers","Formalizing a supplemental executive retention program with deferred payouts","persona-hr-manager",{"title":204,"use_case":205,"icon_asset_id":206},"CEOs and CFOs","Structuring personal deferral elections that defer income tax to a lower-rate year","persona-ceo",{"title":208,"use_case":209,"icon_asset_id":210},"Small business owners","Retaining a key employee for 3–5 years using a deferred bonus arrangement","persona-small-business-owner",{"title":212,"use_case":213,"icon_asset_id":214},"Corporate counsel and in-house lawyers","Documenting a board-approved NQDC plan in a single enforceable agreement","persona-corporate-counsel",{"title":216,"use_case":217,"icon_asset_id":218},"Startup founders","Compensating a critical hire when cash is constrained by deferring part of salary","persona-startup-founder",{"title":220,"use_case":221,"icon_asset_id":222},"Private equity portfolio company operators","Aligning management incentives with a defined exit or holding-period timeline","persona-operations-director",[224,228,232,236,240,243,247],{"situation":225,"recommended_template":226,"slug":227},"Deferring a portion of annual salary or bonus for a senior executive","Deferred Compensation Agreement (Executive)","deferred-compensation-agreement-D13830",{"situation":229,"recommended_template":230,"slug":231},"Retaining a key non-executive employee with a future bonus promise","Retention Bonus Agreement","bonus-agreement-D13815",{"situation":233,"recommended_template":234,"slug":235},"Providing equity-linked deferred compensation tied to company value","Phantom Stock Agreement","phantom-stock-agreement-D12853",{"situation":237,"recommended_template":238,"slug":239},"Granting stock options as part of a deferred compensation structure","Stock Option Agreement","employee-stock-option-agreement-D12613",{"situation":241,"recommended_template":242,"slug":231},"Tying deferred payouts to a defined performance metric","Performance Bonus Agreement",{"situation":244,"recommended_template":245,"slug":246},"Supplementing a qualified 401(k) plan for highly compensated employees","SERP (Supplemental Executive Retirement Plan) Agreement","retirement-agreement-D13035",{"situation":248,"recommended_template":249,"slug":250},"Documenting a salary continuation arrangement for a departing executive","Executive Separation Agreement","separation-agreement-D13184",[252,255,258,261,264,267,270,273,276,279,282],{"term":253,"definition":254},"Nonqualified Deferred Compensation (NQDC)","A compensation arrangement that does not meet the requirements of a qualified retirement plan under ERISA, giving employers flexibility in design but subjecting the arrangement to IRC Section 409A compliance rules.",{"term":256,"definition":257},"IRC Section 409A","The US Internal Revenue Code section governing nonqualified deferred compensation plans; noncompliance triggers immediate income recognition, a 20% excise tax, and interest penalties on the deferred amount.",{"term":259,"definition":260},"Deferral Election","The employee's irrevocable written decision — made before the compensation is earned — specifying the amount to defer and the timing and form of future distribution.",{"term":262,"definition":263},"Vesting Schedule","The timeline over which the employee's right to receive the deferred compensation becomes nonforfeitable, expressed as cliff vesting (100% on a single date) or graded vesting (percentage increments over multiple years).",{"term":265,"definition":266},"Rabbi Trust","An irrevocable grantor trust used to informally fund deferred compensation obligations; assets are protected from the employer's discretionary spending but remain subject to claims of the employer's creditors in bankruptcy.",{"term":268,"definition":269},"Substantial Risk of Forfeiture","A condition under which the employee's right to receive deferred compensation will lapse if a specified requirement — such as continued employment or a performance goal — is not met.",{"term":271,"definition":272},"Permissible Distribution Event","One of the six IRC Section 409A-approved triggers for paying out deferred compensation: separation from service, disability, death, change in control, unforeseeable emergency, or a fixed time or schedule.",{"term":274,"definition":275},"Change in Control","A transfer of majority ownership, merger, or asset sale that triggers accelerated vesting or distribution of deferred compensation under the terms of the agreement.",{"term":277,"definition":278},"Clawback Provision","A contractual right allowing the employer to recoup previously paid or vested deferred compensation upon a specified triggering event, such as a restatement of financial results or a breach of restrictive covenants.",{"term":280,"definition":281},"Specified Employee","Under IRC Section 409A, a key employee of a publicly traded company who must wait six months after separation from service before receiving any deferred compensation distribution.",{"term":283,"definition":284},"SERP","A Supplemental Executive Retirement Plan — a type of nonqualified deferred compensation arrangement used to provide retirement benefits to highly compensated employees beyond qualified plan limits.",[286,291,296,301,306,311,316,321,326,331],{"name":287,"plain_english":288,"sample_language":289,"common_mistake":290},"Parties, purpose, and effective date","Identifies the employer and employee by legal name, states the purpose of the agreement, and sets the date from which the arrangement is effective.","This Deferred Compensation Agreement ('Agreement') is entered into as of [DATE] by and between [EMPLOYER LEGAL NAME], a [STATE] [ENTITY TYPE] ('Company'), and [EMPLOYEE FULL NAME] ('Executive').","Using a trade name instead of the registered legal entity name — if the employer entity doesn't match payroll and corporate records, enforcing a clawback or forfeiture becomes legally complicated.",{"name":292,"plain_english":293,"sample_language":294,"common_mistake":295},"Deferral amount and election","Specifies how much compensation is deferred — a fixed dollar amount, a percentage of salary or bonus, or an amount elected annually by the employee — and requires the election to be made before the compensation is earned.","Executive elects to defer [X]% of Base Salary and [Y]% of Annual Bonus each Plan Year. Such election must be submitted no later than [December 31] of the year preceding the Plan Year to which it relates.","Allowing an election after compensation has already been earned. Under IRC Section 409A, a post-earning election causes immediate income inclusion and the 20% excise tax — the entire deferred amount becomes taxable in the year of the violation.",{"name":297,"plain_english":298,"sample_language":299,"common_mistake":300},"Deferred compensation account","Establishes a bookkeeping account in the employee's name that tracks deferred amounts, any notional earnings or investment credits, and distributions — without requiring the employer to set aside actual funds.","The Company shall establish and maintain a Deferred Compensation Account for Executive, which shall be credited with the Deferral Amount as of [the last day of each pay period / the date the Bonus would otherwise have been paid] and adjusted to reflect Notional Earnings at the rate of [INDEX / FIXED RATE OF X%] per annum.","Promising specific investment returns in the bookkeeping account without carving out market-rate variability. Guaranteeing a fixed return above a de minimis rate can transform the arrangement into a funded plan subject to ERISA.",{"name":302,"plain_english":303,"sample_language":304,"common_mistake":305},"Vesting schedule","States when the employee's right to receive the deferred compensation becomes nonforfeitable — using cliff vesting, graded vesting, or immediate vesting depending on the retention objective.","Executive shall vest in the Deferred Compensation Account as follows: 33% on the first anniversary of the Effective Date, 33% on the second anniversary, and 34% on the third anniversary, provided Executive remains continuously employed by the Company on each such date.","Using a vesting schedule that is too short to serve as a meaningful retention tool, or too long to be legally defensible as linked to a substantial risk of forfeiture — three to five years is the typical enforced range.",{"name":307,"plain_english":308,"sample_language":309,"common_mistake":310},"Permissible distribution events and timing","Lists the specific triggering events that allow payment of the deferred compensation and the timing and form of each payout — critical for IRC Section 409A compliance.","Distribution shall be made upon the earliest of: (a) Executive's separation from service, subject to the six-month delay for Specified Employees; (b) Executive's death or Disability; (c) a Change in Control; or (d) [DATE], in each case in a lump sum / [X] annual installments.","Adding discretionary payout triggers beyond the six permitted Section 409A distribution events — for example, allowing the employer to accelerate payment 'at its discretion.' This voids Section 409A compliance and triggers the excise tax.",{"name":312,"plain_english":313,"sample_language":314,"common_mistake":315},"Forfeiture and clawback","Defines the conditions under which unvested or even vested deferred compensation is forfeited or clawed back — typically tied to termination for cause, breach of restrictive covenants, or financial restatement.","Executive shall forfeit all unvested amounts upon termination for Cause. In the event of a material restatement of Company financial results, the Company may recoup any vested amounts paid within the preceding [24] months to the extent attributable to the restated period.","Omitting a clawback clause entirely or failing to align it with the employer's Dodd-Frank clawback policy for public companies — listed companies are required to maintain and enforce a clawback policy under SEC Rule 10D-1.",{"name":317,"plain_english":318,"sample_language":319,"common_mistake":320},"Funding and rabbi trust","States whether the employer will fund its obligation informally through a rabbi trust or remain unfunded, and — if a trust is used — clarifies that assets remain subject to the employer's creditors in insolvency.","The Company may, in its discretion, establish a rabbi trust to hold assets intended to satisfy its obligations under this Agreement. Any such trust assets shall remain subject to the claims of the Company's general creditors in the event of insolvency or bankruptcy.","Promising the employee that trust assets are fully protected from creditor claims. A secular trust with true asset protection converts the arrangement into a funded plan subject to immediate income inclusion.",{"name":322,"plain_english":323,"sample_language":324,"common_mistake":325},"Change-in-control treatment","Specifies whether a change of control accelerates vesting, triggers distribution, or has no effect — and defines what constitutes a qualifying change-of-control event.","Upon a Change in Control, all unvested amounts shall immediately vest. Distribution following a Change in Control shall be made in a lump sum within [90] days of the event, provided such event constitutes a change in the ownership or effective control of the Company within the meaning of Treasury Regulation §1.409A-3(i)(5).","Defining 'change in control' more broadly than the Section 409A regulatory definition — a payout trigger that does not qualify under the treasury regulation exposes the payment to excise taxes even if the intent was legitimate.",{"name":327,"plain_english":328,"sample_language":329,"common_mistake":330},"Tax withholding and compliance","Confirms that all deferred amounts remain subject to applicable payroll and income tax withholding at the time of distribution, and that the agreement is intended to comply with IRC Section 409A.","All distributions under this Agreement shall be subject to withholding for federal, state, and local income and employment taxes. This Agreement is intended to comply with IRC Section 409A and shall be interpreted and administered consistently therewith.","Failing to include a 409A savings clause. Without one, any inadvertent noncompliance cannot be cured by interpretive construction, and courts have refused to reform agreements that are silent on compliance intent.",{"name":332,"plain_english":333,"sample_language":334,"common_mistake":335},"Governing law, entire agreement, and amendment","Identifies the controlling jurisdiction's law, confirms this document supersedes all prior compensation promises related to the deferred amount, and restricts amendments to written, signed modifications.","This Agreement is governed by the laws of [STATE]. This Agreement constitutes the entire agreement between the parties with respect to the subject matter hereof and supersedes all prior understandings. No amendment shall be effective unless made in writing and signed by both parties, provided that any amendment that affects the time or form of payment shall comply with IRC Section 409A.","Allowing informal amendments by email or oral agreement — any change to payout timing or form must meet Section 409A's subsequent deferral election rules or the amendment itself triggers excise taxes.",[337,342,347,352,357,362,367,372],{"step":338,"title":339,"description":340,"tip":341},1,"Enter the legal entity names and effective date","Use the employer's full registered corporate name and the employee's legal name as it appears on government ID. Set the effective date before any compensation subject to the agreement is earned.","Cross-reference the corporate registry to confirm the exact employer entity — a mismatch between the agreement and payroll records complicates enforcement.",{"step":343,"title":344,"description":345,"tip":346},2,"Define the deferral amount and election deadline","Specify whether the deferral is a fixed dollar amount, a percentage of salary, a percentage of bonus, or an annual employee election. Set the election deadline to at least one day before the start of the plan year in which the compensation is earned.","For bonuses that are performance-based, Section 409A permits a later election deadline of up to six months before the end of the performance period — confirm the bonus qualifies before using the extended window.",{"step":348,"title":349,"description":350,"tip":351},3,"Set up the bookkeeping account and notional earnings rate","Describe how the deferred account will be credited and what rate or index will be used to calculate notional investment returns. Common choices are a fixed rate (e.g., 5% per annum), a market index (e.g., S&P 500), or a menu of hypothetical investment options.","Avoid guaranteeing a fixed rate materially above the applicable federal rate — this can attract IRS scrutiny as a funded arrangement.",{"step":353,"title":354,"description":355,"tip":356},4,"Choose and document the vesting schedule","Select cliff or graded vesting with a schedule tied to the retention objective. Three to five years is the most common range. Ensure the schedule creates a genuine substantial risk of forfeiture rather than a token condition.","For retention agreements with a specific project or transaction timeline, cliff vesting on the target completion date is often more motivating than annual graded vesting.",{"step":358,"title":359,"description":360,"tip":361},5,"Specify permissible distribution triggers and payout form","List only the Section 409A-approved distribution events: separation from service, death, disability, change in control, unforeseeable emergency, or a fixed date or schedule. For each trigger, state whether payment is a lump sum or installments.","Installment distributions spread the income tax hit over multiple years — for large deferred balances, this is often more tax-efficient than a lump sum.",{"step":363,"title":364,"description":365,"tip":366},6,"Draft the forfeiture and clawback conditions","Define termination-for-cause forfeiture and any performance-based forfeiture conditions for unvested amounts. For vested amounts, add a clawback tied to financial restatement or breach of restrictive covenants.","If the employer is a public company subject to Dodd-Frank, confirm the clawback provision aligns with the SEC Rule 10D-1 compensation recovery policy.",{"step":368,"title":369,"description":370,"tip":371},7,"Decide on a rabbi trust and document it","If the employer intends to informally fund the obligation, reference the rabbi trust arrangement and include the creditor-subordination language required by IRS Revenue Procedure 92-64.","A rabbi trust improves executive confidence in the arrangement without creating a funded plan — but the employer's legal counsel should review the trust document separately.",{"step":373,"title":374,"description":375,"tip":376},8,"Add the 409A savings clause and execute before earnings begin","Insert the Section 409A compliance and savings clause in the tax section, then obtain signatures from both parties before the first deferral period begins. Have counsel review before execution for any arrangement above $50,000.","Use a dated signature block for each party and retain a fully executed copy in the employee's personnel file and the company's corporate records.",[378,382,386,390,394,398],{"mistake":379,"why_it_matters":380,"fix":381},"Making or accepting a deferral election after compensation is earned","Under IRC Section 409A, an election made after the right to the compensation has vested causes immediate income inclusion, a 20% excise tax, and interest penalties on the entire deferred amount — regardless of when it is actually paid.","Execute the deferral election before the start of the plan year in which the compensation will be earned. For performance bonuses, confirm whether the 18-month performance-period exception applies before using a later election date.",{"mistake":383,"why_it_matters":384,"fix":385},"Adding a discretionary payout trigger outside the six Section 409A events","Any distribution event not listed in Section 409A — such as 'at the employer's discretion' or 'upon a liquidity event' that does not meet the regulatory definition of a change in control — causes the entire plan balance to become immediately taxable with penalties.","Limit distribution triggers strictly to the six statutory events and ensure each is defined using the Section 409A treasury regulation language, not informal business definitions.",{"mistake":387,"why_it_matters":388,"fix":389},"Failing to include a 409A savings and compliance clause","Without an explicit savings clause, courts and the IRS cannot use interpretive flexibility to cure inadvertent technical violations — the agreement is judged on its literal terms.","Include a clause stating the agreement is intended to comply with IRC Section 409A and shall be interpreted consistently with that intent, with any ambiguous provision construed to avoid noncompliance.",{"mistake":391,"why_it_matters":392,"fix":393},"Omitting creditor-subordination language when using a rabbi trust","A rabbi trust without proper creditor-subordination language may be treated as a funded secular trust, causing immediate income inclusion for the employee — defeating the purpose of the deferral entirely.","Follow IRS Revenue Procedure 92-64 model trust language and include an explicit provision that trust assets remain subject to the claims of the employer's general creditors in insolvency or bankruptcy.",{"mistake":395,"why_it_matters":396,"fix":397},"Using a vesting schedule so short it does not constitute a substantial risk of forfeiture","If the IRS determines there is no genuine forfeiture risk — for example, a 30-day cliff vest — the deferred compensation may be treated as constructively received and taxable in the year it was earned.","Set a vesting schedule of at least 12 months tied to continued employment, and preferably 24–60 months for material amounts. Ensure forfeiture conditions are real, not cosmetic.",{"mistake":399,"why_it_matters":400,"fix":401},"Failing to coordinate the agreement with existing employment contract terms","Conflicting termination provisions between an employment contract and a deferred compensation agreement — particularly around what constitutes 'cause' or 'good reason' — create competing interpretations that employees and their counsel exploit in separation disputes.","Cross-reference and harmonize defined terms between the employment contract and the deferred compensation agreement before execution. Use identical definitions of 'cause,' 'good reason,' and 'change in control' across both documents.",[403,406,409,412,415,418,421,424,427],{"question":404,"answer":405},"What is a deferred compensation agreement?","A deferred compensation agreement is a binding contract between an employer and an employee under which a portion of earned compensation — salary, bonus, or other remuneration — is set aside and paid at a future date rather than when earned. Most arrangements for US employees are nonqualified deferred compensation plans (NQDC) governed by IRC Section 409A. They are used to retain key employees, defer income tax to future years, and align executive incentives with long-term company performance.\n",{"question":407,"answer":408},"What is the difference between a qualified and a nonqualified deferred compensation plan?","A qualified plan — such as a 401(k) or pension plan — meets ERISA requirements, offers immediate tax deductions for employer contributions, and must cover a broad group of employees. A nonqualified plan is not bound by ERISA coverage rules, giving employers flexibility to offer it selectively to executives or key employees, but the employer cannot deduct contributions until the employee receives the income. The tradeoff is flexibility in exchange for greater tax complexity under IRC Section 409A.\n",{"question":410,"answer":411},"What is IRC Section 409A and why does it matter?","IRC Section 409A is the US tax code provision governing nonqualified deferred compensation. It requires deferral elections to be made before compensation is earned, limits permissible distribution events to six specific categories, and restricts subsequent changes to payout timing. Violations result in immediate income inclusion, a 20% excise tax on the deferred amount, and interest penalties — all borne by the employee. Every US deferred compensation agreement must be drafted to comply with Section 409A and its treasury regulations.\n",{"question":413,"answer":414},"What are the permissible distribution events under Section 409A?","Section 409A permits deferred compensation to be distributed only upon one of six events: separation from service, the employee's death, the employee's disability, a change in control of the employer (as defined by treasury regulation), an unforeseeable emergency, or a fixed date or schedule specified in the agreement at the time of deferral. Any payout trigger outside these six categories — including employer discretion or a liquidity event that does not meet the regulatory definition — violates Section 409A.\n",{"question":416,"answer":417},"Do deferred compensation agreements need to be reviewed by a lawyer?","For any material amount — generally above $25,000–$50,000 — legal review is strongly recommended. IRC Section 409A imposes strict timing, election, and distribution rules where errors cannot easily be corrected after the fact and penalties fall on the employee. A one-to-two hour review by a compensation or tax attorney typically costs $400–$800 and can prevent excise tax exposure that dwarfs the cost of advice.\n",{"question":419,"answer":420},"What is a rabbi trust and should the employer use one?","A rabbi trust is an irrevocable grantor trust used to informally fund deferred compensation obligations. It protects deferred amounts from the employer's discretionary spending — increasing executive confidence in the arrangement — but assets remain subject to the employer's general creditors in bankruptcy. This distinction prevents the arrangement from being treated as a funded ERISA plan that would trigger immediate income inclusion. Rabbi trusts are optional but commonly used when deferred balances are large or when the executive has negotiating leverage to require one.\n",{"question":422,"answer":423},"What happens to deferred compensation if the employer goes bankrupt?","Because nonqualified deferred compensation is an unsecured promise to pay, the employee becomes a general creditor of the employer in bankruptcy. Rabbi trust assets, while protected from the employer's day-to-day spending, are also available to satisfy general creditor claims in insolvency — the employee has no priority over other unsecured creditors. This insolvency risk is a fundamental characteristic of NQDC arrangements that executives should weigh carefully when negotiating large deferred balances.\n",{"question":425,"answer":426},"Can a deferred compensation agreement be amended after signing?","Yes, but amendments that change the timing or form of payment must comply with Section 409A's subsequent deferral election rules — generally requiring that the amendment be made at least 12 months before the scheduled payment date and that it defer payment by at least five additional years. Amendments that do not affect payment timing (such as updating a notional earnings index) have more flexibility. Any amendment should be reviewed by a tax attorney to confirm it does not inadvertently trigger a Section 409A violation.\n",{"question":428,"answer":429},"How is deferred compensation taxed when distributed?","Deferred compensation is taxed as ordinary income to the employee in the year of distribution, not the year it was earned. FICA (Social Security and Medicare) taxes are generally owed when the amount vests — which may be earlier than distribution. The employer must withhold federal and state income taxes at the time of payout. The tax-deferral benefit is realized when the employee is in a lower marginal rate at distribution than at the time of earning, which is common for post-retirement payouts.\n",[431,435,439,443,447,451],{"industry":432,"icon_asset_id":433,"specifics":434},"Technology / SaaS","industry-saas","Used to retain engineering leads and product executives when cash compensation is constrained; often structured with a change-of-control trigger tied to an anticipated acquisition or IPO.",{"industry":436,"icon_asset_id":437,"specifics":438},"Financial Services","industry-fintech","Heavily regulated firms use NQDC plans to supplement 401(k) limits for highly compensated employees; mandatory deferral of a portion of bonus is common practice at investment banks and asset managers.",{"industry":440,"icon_asset_id":441,"specifics":442},"Healthcare","industry-healthtech","Hospital systems and physician groups use deferred compensation to retain key medical directors and administrators; 457(b) and 457(f) plans are the primary vehicles for tax-exempt entities.",{"industry":444,"icon_asset_id":445,"specifics":446},"Professional Services","industry-professional-services","Law firms, consulting firms, and accounting practices defer a portion of partner-level compensation to fund retirement-like distributions, often structured as salary continuation tied to post-retirement non-compete obligations.",{"industry":448,"icon_asset_id":449,"specifics":450},"Manufacturing","industry-manufacturing","Used to retain plant managers and operations executives with multi-year vesting tied to capital project milestones or long-term operational performance targets.",{"industry":452,"icon_asset_id":453,"specifics":454},"Retail / Hospitality","industry-retail","Regional and divisional executives at large retail chains often receive deferred compensation tied to multi-year same-store sales targets, with change-of-control acceleration common given frequent M&A activity in the sector.",[456,460,463,466],{"vs":457,"vs_template_id":458,"summary":459},"Employment Contract","employment-agreement_at-will-employee-D541","An employment contract governs the overall terms of the employment relationship — title, salary, duties, termination, and restrictive covenants. A deferred compensation agreement is a supplemental document that addresses only the deferral and future payout of a portion of that compensation. The two documents should cross-reference each other and use consistent defined terms, particularly for 'cause,' 'good reason,' and 'change in control.'",{"vs":230,"vs_template_id":461,"summary":462},"D{RETENTION_BONUS_ID}","A retention bonus agreement promises a lump-sum cash payment contingent on the employee remaining employed through a specific date — it is paid in full at that point with no ongoing deferral mechanics. A deferred compensation agreement involves an ongoing deferral of earned income with vesting, notional earnings, and Section 409A distribution rules. Retention bonuses are simpler to administer; deferred compensation is more flexible for larger, multi-year arrangements.",{"vs":234,"vs_template_id":464,"summary":465},"D{PHANTOM_STOCK_ID}","A phantom stock agreement provides the economic equivalent of equity appreciation without issuing actual shares — payouts track the change in company value over time. A deferred compensation agreement defers cash compensation that has already been earned rather than creating a new value-tracking instrument. Phantom stock is better suited to companies where equity upside is the motivating factor; deferred compensation is preferable when retaining earned cash income is the goal.",{"vs":238,"vs_template_id":467,"summary":468},"stock-option-plan-D13552","A stock option agreement grants the right to purchase shares at a fixed price after a vesting period, creating value only if the share price appreciates. A deferred compensation agreement defers already-earned cash compensation with a predictable, contractually defined payout. Options carry upside and downside risk tied to company performance; deferred compensation is a more certain obligation of the employer, making it preferable for risk-averse executives or companies without a clear equity-value story.",{"use_template":470,"template_plus_review":474,"custom_drafted":478},{"best_for":471,"cost":472,"time":473},"Small business owners structuring a straightforward deferred bonus arrangement for one key employee in a single US state","Free","30–60 minutes",{"best_for":475,"cost":476,"time":477},"Any arrangement above $50,000, executive-level hires, or employers in multiple states or jurisdictions","$400–$800 for a one-to-two hour tax or compensation attorney review","1–3 days",{"best_for":479,"cost":480,"time":481},"Public companies, financial-services firms, or arrangements involving rabbi trusts, SERP structures, or complex vesting tied to M&A events","$2,000–$8,000+","2–4 weeks",[483,488,493,498],{"code":484,"name":485,"flag_asset_id":486,"note":487},"us","United States","flag-us","IRC Section 409A governs all nonqualified deferred compensation for US taxpayers, imposing strict rules on election timing, permissible distribution events, and subsequent deferrals. Violations result in a 20% excise tax plus interest on the deferred amount, borne by the employee. Public companies must also comply with SEC Rule 10D-1 clawback requirements. State income taxes apply at the time of distribution in most states; California taxes deferred compensation when the employee was a California resident during the service period, regardless of where they live at distribution.",{"code":489,"name":490,"flag_asset_id":491,"note":492},"ca","Canada","flag-ca","Canada does not have a Section 409A equivalent, but deferred compensation arrangements must be structured carefully under the Income Tax Act to avoid the salary deferral arrangement (SDA) rules, which can cause immediate income inclusion if the primary purpose of the deferral is tax reduction rather than a genuine retirement or incentive objective. The six-year deferral limit under the SDA rules significantly restricts long-term deferrals for most employees. Quebec's Act Respecting Labour Standards may impose additional constraints for provincially regulated employers.",{"code":494,"name":495,"flag_asset_id":496,"note":497},"uk","United Kingdom","flag-uk","UK deferred compensation arrangements are subject to the Employment Income Parts 7A and 7AA of the Income Tax (Earnings and Pensions) Act 2003, which impose a disguised remuneration charge on employer-funded arrangements held in third-party trusts. Arrangements using UK equivalents of rabbi trusts must be structured carefully to avoid an immediate income tax charge. National Insurance Contributions (NICs) are generally due when the deferred amount vests rather than when paid. The Financial Conduct Authority imposes additional deferral and clawback requirements for Material Risk Takers at regulated firms.",{"code":499,"name":500,"flag_asset_id":501,"note":502},"eu","European Union","flag-eu","There is no unified EU framework for deferred compensation; each member state applies its own income tax and social security rules at vesting or distribution. France, Germany, and the Netherlands each have distinct rules on when deferred remuneration becomes taxable and whether employer contributions to trust-like vehicles are deductible. For regulated financial institutions, the EU Capital Requirements Directive (CRD V) mandates minimum deferral periods and clawback provisions for Material Risk Takers, requiring at least 40–60% of variable compensation to be deferred for a minimum of four to five years.",[458,504,505,506,507,508,231,509,510,511,512,513],"employment-agreement-executive-D543","stock-option-plan-D13284","non-disclosure-agreement-nda-D12692","general-non-compete-agreement-D882","employee-separation-agreement-D12842","independent-contractor-agreement-D160","job-offer-letter-long-D12769","board-resolution-D78","adhesion-to-the-unanimous-shareholder-agreement-D848","agreement-of-purchase-and-sale-of-business-assets-D318",{"emit_how_to":191,"emit_defined_term":191},{"primary_folder":102,"secondary_folder":516,"document_type":517,"industry":518,"business_stage":519,"tags":520,"confidence":525},"employment-and-contractors","agreement","general","all-stages",[521,522,523,524],"deferred-compensation","executive-compensation","employment-agreement","compensation-and-payroll",0.95,"\u003Ch2>What is a Deferred Compensation Agreement?\u003C/h2>\n\u003Cp>A \u003Cstrong>Deferred Compensation Agreement\u003C/strong> is a legally binding contract between an employer and an employee — typically an executive, senior manager, or other key person — under which a portion of earned compensation is withheld from current payment and paid out at a specified future date or upon a defined triggering event. Unlike a qualified retirement plan such as a 401(k), a nonqualified deferred compensation (NQDC) arrangement is not subject to ERISA's coverage and funding rules, giving employers the flexibility to offer it selectively and structure it around retention or performance objectives. In the United States, virtually all such arrangements must comply with IRC Section 409A, which governs election timing, permissible distribution triggers, and payout mechanics with strict penalties for noncompliance — making precise drafting essential.\u003C/p>\n\u003Ch2>Why You Need This Document\u003C/h2>\n\u003Cp>Without a written deferred compensation agreement, a verbal or email-based promise to pay a future bonus or deferred salary is nearly impossible to enforce and creates immediate legal and tax exposure for both parties. The employee has no documented right to the deferred amount and no defined payout terms to rely on; the employer has no vesting or forfeiture conditions to protect against early departure. From a tax perspective, an undocumented or improperly structured arrangement can be treated as constructively received — meaning the employee owes income tax on the full amount immediately, with no deferral benefit realized at all. A properly executed agreement defines every material term — deferral amount, vesting conditions, permissible distribution events, forfeiture triggers, and Section 409A compliance language — in a single enforceable document that protects both the employer's retention objectives and the employee's expectation of future payment.\u003C/p>\n",1781185992595]