With special thanks to author Aimee Rosien.
Given recent developments and trends in the United States relating to restricted covenants (especially non-competes), companies should take another look at any restrictive covenants included in equity award agreements.
In the past, companies rarely tailored restrictive covenants in equity award agreements to each jurisdiction (US states or countries outside the United States). Now, with so many new restrictions in the United States, it is more typical for companies to tailor the restrictive covenants for compliance with applicable US state law.
However, outside the United States, enforcing restrictive covenants in an award agreement is even more problematic, especially non-compete and non-solicitation covenants. To learn more about the possible approaches companies can take to deal with restrictive covenants for employees outside the United States, read our recent NASPP guest blog post.