Executive Employment Agreement
(Pro-executive) (PA)

Summary

This template is an executive employment agreement between a single employer and an executive and is drafted from the perspective of an executive hire with ample negotiation leverage and therefore contains more executive-friendly provisions. This template includes practical guidance, drafting notes, and alternate clauses. This template is state-specific to Pennsylvania and, therefore, should be tailored to suit the relevant circumstances, including consideration of state or local employment law issues. Unlike a pro-employer executive employer agreement, this agreement does not bind the executive to arbitration and does not contain pro-employer restrictive covenants on the executive, such as non-solicitation, non-competition, non-disclosure, non-disparagement, and proprietary information restrictive covenants. Rather, it includes employee-friendly definition of Good Reason, relatively generous severance and change-in-control severance terms, and executive-friendly indemnification rights, and other special benefits such as reimbursement of attorney's fees (for agreement negotiation and for litigating agreement matters if the executive prevails) and tax gross-ups for parachute payments, I.R.C. § 409A violations, and severance payments relating to the cost of health insurance coverage. However, note that tax gross-up and other executive perquisites have become increasingly less common, particularly at public companies. For a full listing of related ancillary agreement content, see Ancillary Agreements in M&A Transactions Resource Kit. For an employer friendly agreement, see Executive Employment Agreement (Pro-employer) (PA). For additional guidance, see the Executive Employment Agreement Resource Kit, which includes the practice notes Executive Employment Agreement Negotiation and Drafting (Pro-employer), Executive Employment Agreement Negotiation and Drafting (Pro-executive), and Executive Employment Agreement Insights: From High Stakes to Competing Interests. See also the related templates Executive Employment Agreement Term Sheet and Executive Offer Letter. For additional related practical guidance, see the Section 280G Resource Kit. To compare state and federal laws on restrictive covenants and terminations in employment agreements, see the Labor and Employment State Law Comparison Tool. For a practice note and chart that summarizes and describes market trends and key terms found within a sample of executive employment agreements entered into by public companies during the first quarter of 2023, see Market Trends 1Q 2023: Executive Employment Agreements. For a full listing of key content covering executive employee agreement considerations, see Executive Employment Agreement Resource Kit. Executive Employment Agreement Precedents You can find precedents of executive employment agreements with Market Standards–Employment Agreements, the searchable database from Practical Guidance of publicly filed executive employment agreements that enables users to search, compare, and analyze over 6,000 agreements, dated from 2017 to the present, using approximately 75 detailed deal points to filter search results. For more information on Market Standards–Employment Agreements coverage, click here. Click here to access employment agreements on Market Standards. Following are Market Standards links to the results page for recently filed agreements and the information/agreement page for selected agreements: • Results page for covered agreements filed with the SEC within the last 60 days • First American Financial Corporation, CEO (February 20, 2024) • Dyne Therapeutics, Inc. President & CEO (March 21, 2024) • SANUWAVE, Inc., CFO (March 26, 2024) • Nauticus Robotics, Inc., CEO (February 21, 2024) • Vimeo, Inc., CEO (March 26, 2024) • Shake Shack Enterprises, LLC, CEO (March 18, 2024)