The agreement should give a detailed outline of the position and duties. This outline gives the employee clearly defined authority and responsibility, and the employer a means of measuring performance. An employer also should include language allowing assignment of additional duties, as appropriate, if the need arises. The agreement should specify that the employer expects the full and exclusive services of the employee. Executives' contracts often specify a term, along with renewal rights.
Companies usually prefer short- term contracts, possibly conditioned on net profits.
Renewals can be automatic or on specified advance notice. Much of an executive's compensation normally takes the form of incentive pay, including bonuses based on profits or sales, stock options, and deferred compensation. In addition to benefits open to all employees, an executive may receive other perks, such as annual bonuses, extra vacation time, company cars, entertainment expenses, club memberships, or added death and disability benefits.