Related Practices
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Covington lawyers regularly handle the employee benefits and executive compensation aspects of business transactions of all kinds, both in the United States and internationally. For example, we handle the employee benefits and executive compensation aspects of:
- Acquisitions, divestitures, and other business reorganizations (mergers, stock sales, asset sales, spin-offs, auctions, and IPOs);
- Joint ventures;
- Corporate finance (loans, credit facilities, private placements, and public debt offerings); and
- Employee outsourcing and leasing arrangements.
We combine our technical skills with practical business judgment to help our clients--including employers, lenders, borrowers, investors and management groups--carry out their business objectives.
Our creativity and practical judgment are as important as our technical expertise in helping our clients analyze their obligations and address a wide range of issues in business transactions. The following are examples of the range of assignments that we routinely handle:
- Analyze equity compensation plans to determine whether stock options and other equity awards should be cashed out, assumed, or replaced with awards issued by the buyer;
- Draft employment, retention, and separation agreements for key employees;
- Negotiate the terms on which defined benefit plan assets and liabilities will be transferred;
- Resolve participant voting issues, fiduciary issues, and tax issues that arise when a retirement savings plan holds the stock of a target company;
- Design affordable benefit programs and employee transfer arrangements for companies that combine to form a joint venture;
- Design and review change in control provisions for senior executive retirement and other deferred compensation arrangements;
- Examine severance programs and post-retirement medical benefits to identify unanticipated liabilities;
- Formulate the benefit-related events of default under corporate debt agreements to ensure that they will not be triggered inadvertently;
- Design and negotiate practical transition service arrangements for benefits, payroll, and other services for employees affected by business transactions; and
- Advise companies on “early warning,” “reportable event,” and other matters involving the Pension Benefit Guaranty Corporation.
Our lawyers have successfully resolved a number of early warning cases in which the PBGC sought substantial additional pension funding or guarantees as a condition of permitting major corporate transactions to proceed.
Representative Matters
- The $3.6 billion sale of King Pharmaceuticals to Pfizer.
- AstraZeneca’s $1.26 billion acquisition of Ardea Biosciences.
- Thomson Reuters’s $1.25 billion sale of its Healthcare business to an affiliate of Veritas Capital.
- Tom Benson’s purchase of the NBA’s New Orleans Hornets.
- SandRidge Energy’s $1.275 billion acquisition of Dynamic Offshore Resources, LLC.
- Joy Global’s $375 million sale of its drilling products business to Cameron International Corp.
- Bristol-Myers Squibb’s $325 million acquisition of Amira Pharmaceuticals.
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