the Board of Directors and any new director (with the exception of a director, who is appointed by a person who has entered into an agreement with the Corporation for a transaction described in the clauses (A) or (D) of this section), whose election was approved by the Board of Directors or elected by the company`s shareholders by a vote of at least two-thirds of the directors in office at the time, who were directors at the beginning of the period or whose election or appointment was previously approved, for whatever reason, to form a majority; (C) the company enters into an agreement, the conclusion of which would lead to entry if the control of the company were changed; or (D) the company`s shareholders in a merger or consolidation of the company with another company, other than a merger or consolidation, which would result in the company`s voting shares being at least 30% of the combined voting rights of the shares of the company or that surviving entity immediately after the merger or consolidation, or the Corporation`s shareholders approve a plan for the full liquidation of the corporation or an agreement to sell or dispose of all or all of the corporation`s assets. To fully benefit from these benefits, a senior staff member must meet the conditions set out in the agreement. Typically, this requires staying in charge for X years and/or completing a specific main task. Typically, an executive can choose a specific beneficiary for an NQDC plan or a SERP. In today`s economy, skilled talent is so in demand that some people have virtually limitless job opportunities. Recruiting, training and engaging staff is an expensive undertaking at all levels and even more so when the new employee has excessive skills that place him or her within a high salary range. As a result, some companies are using a golden handcuff agreement — an advantageous and controversial agreement. In addition to these positive incentives, gold handcuffs can take the form of negative/unaffordable incentives. For example, a confidentiality clause preventing an employee from disclosing confidential information or a non-compete clause to prevent an employee from working with the company for a period of time, thereby preventing the employee from leaving the company.
These have already been the subject of a separate debate, so we will discuss here the financial incentives that will be used as handcuffs.
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