In this interview with Jennifer Rubin, Member, Employment, Labor & Benefits Practice at Mintz Levin, we discuss why executives employment agreements need to be done in writing.
Jen focuses on C-suite executive compensation practices, and on meeting the increasingly complex employment needs of executives of public and private corporations. When she isn’t negotiating employment, equity and severance arrangements, Jen leverages her twenty-five years of experience as a trial lawyer to help clients craft business solutions to legal problems. Jen, who has an AV Preeminent ranking from Martindale-Hubbell, which publishes a highly respected Law Directory, that provides background information on United States lawyers and law firms.
She is also a member of the Board of Directors of Big Brothers Big Sisters of San Diego County and is a faculty member and advisor to The Honor Foundation, a non-profit organization that assists Navy Seals and other armed services special operators transition from military service to the private sector. Jen is frequently quoted in the Wall Street Journal and other publications.
Patrick: I think any time that you raise an institutional round of financing, like a Series A, and you bring venture capitalists in, if you’re a founder of a company, you need to get these things put in place. There have been times in my career when the VCs have said, “Just trust us.” My answer is, “This isn’t a matter of trust.
This is a matter of clarifying how things will work in the event that things go sideways.” If I didn’t trust you, I wouldn’t even work with you. You wouldn’t ask me to sign a proprietary invention non-disclosure agreement unless you trusted me. It’s not really about trust.
I think that’s a negotiation tactic that people use. If you’re a founder or a CEO, sometimes it’s very difficult to negotiate for yourself. Even if you’re a fantastic negotiator with customers, it’s really important that you get these things put in place. Although Jenn wouldn’t give us statistics, it is common for these things to happen.
The time to negotiate these things is not as you’re being exited. The time to negotiate is when you’re bringing in an institutional round of financing if you’re a founder or when you’re negotiating coming into a company if you’re the CEO that is being brought in.
Jennifer: That’s right. Think of it this way. You can’t submit a handshake as Exhibit A at trial.
This is Patrick Henry, CEO of QuestFusion, with The Real Deal…What Matters.