When we are asked to review equity plans and related agreements governing equity awards and share purchase rights granted to participants in the United States and abroad, they often contain beneficiary designation provisions. While nice in theory, beneficiary designations are administratively burdensome and fraught with pitfalls, particularly outside the United States.
As we’ve recently been helping several companies work through the ins and outs of the treatment of awards upon the death of a participant, we thought it would be worthwhile to highlight the potential complications with permitting beneficiary designations and provide alternate recommendations when drafting equity documentation and policies.
To learn more about the pros and cons of beneficiary designation provisions in equity plans and related agreements, see our recent National Association of Stock Plan Professionals (NASPP) guest blog post here.
