On Thursday September 1, 2022, 2022, CEOWorld magazine published an article I wrote on “Stock Rights That Protect the Value of Your Executive Equity Compensation.”
This new article is designed for CEOs, C-level and senior executives, who have recently received a job offer or expect to receive a job offer and will be negotiating terms of executive compensation which will include executive equity.
In those negotiations, executive equity is often a very significant and often a major part of the executive compensation and a often a driver to accept a job offer. This is so because executive equity offers the prospect of greater financial upside value than from your fairly fixed and limited cash compensation. This special upside potential for executive equity arises from three different factors: (a) Appreciation – with your service the stock price or value might rise significantly, (b) Liquidity Event – a potential acquisition or an IPO might also significantly increase value, (c) Favorable Taxation – with appropriate structuring, appreciated equity on cash out may be taxed at a much lower rate than cash compensation for much greater take home pay.
Thus, given the high importance of equity in the CEO’s or C-level executive’s compensation package the focus of my article then moves to discuss these five (5) critical areas of stock rights and terms you want to be sure to give proper attention in your negotiations to give you the best chance to achieve the potential value from the equity you are granted:
To see my full CEOWORLD magazine. article, go to LINK: https://ceoworld.biz/2022/09/01/stock-rights-that-protect-the-value-of-your-executive-equity-compensation/
Or on my website at https://www.executiveemploymentattorney.com/stock-rights-that-protect-the-value-of-your-executive-equity-compensation/
This was my 38th article published in CEOWORLD since 2016. Previously, the editor advised that I can use “Featured in the CEOWORLD magazine” and the CEOWORLD “Logo” on my website and add CEOWORLD magazine in my LinkedIn profile’s “Experience Section” as an “Opinion Columnist.” and authority in the field.
On its own initiative, CEOWORLD magazine created on their website a library of Robert Adelson published articles. You can peruse this library and/or read as many of my 38 published articles as you wish. See https://ceoworld.biz/author/robert-adelson/
With more than 12.4+ million-page views, CEOWORLD magazine is the world’s leading business magazine written strictly for CEOs, CFOs, CIOs, senior management executives, business leaders, and high net worth individuals worldwide. https://www.linkedin.com/company/ceomagazine/
Two weeks ago, on December 18, 2020, I was quoted on the utility of corporate CEOs taking restricted stock units (RSUs) in lieu of cash bonuses, in an article, with the title above, published in the Las Vegas Review-Journal.
The newspaper that published this article, Las Vegas Review-Journal is the largest circulating daily newspaper in Nevada and ranked as one of the top 25 newspapers in the United States by circulation. https://en.wikipedia.org/wiki/Las_Vegas_Review-Journal
The article was about casino company CEO compensation, and how a number of Las Vegas-based CEOs had reduced their salaries in exchange for RSUs amid the pandemic, with the reporter wondering what their compensation might look like down the road.
In the course of our interview, I suggested a number of benefits from this exchange executive compensation strategy of a cash bonus exchanged for RSUs – both to benefit the executive personally but to benefit the company and company stakeholders, including the following:
To see this full article on CEO use of RSUs in the Las Vegas Review-Journal , go to LINK:
Gaming CEOs traded salary for stocks. Their ‘gamble’ is set to pay off.
The business reporter who authored this article, Bailey Schultz, said she had found me and reached out to me after reading an earlier article I wrote on RSUs that was published in CEO World. That article, published February 28, 2017, was entitled “The Advantage of RSUs in Your CEO Compensation Package.”
My 2017 RSUs article, targeted toward CEOs, C-Suite executives and other senior level executives, discussing the benefits of RSUs as a key part and often the most important part of their compensation package. The article discussed how RSUs are most useful in mature companies where the CEO or C-suite executive takes a position where stock has considerable value, but growth is still expected in the public company or perhaps an IPO or liquidity event is not far off or in a turnaround situation in a mature company where there is no assurance of appreciation and the CEO needs assurance of a floor in his or her equity value.
As part of my overall discussion of RSUs, my 2017 article covered these topics –
To see my full article, go to LINK: http://ceoworld.biz/2017/02/28/advantage-rsus-ceo-compensation-package/
It is my hope that this article will be of benefit to CEOs, C-level and senior executives who might benefit or whose companies might benefit from the use of RSUs as part of the executive compensation package. If you or any colleague of yours has a need in this area, please do reach out to me at firstname.lastname@example.org.
On November 5, 2020, CEOWorld magazine published an article I wrote on “Negotiating a Custom CEO or C-level Executive Compensation Package” .
This new article is designed for CEOs, C-level and senior executives, who are negotiating new job offers where the metrics of a routine Gartner or Mercer compensation survey are just not appropriate for that particular CEO or C-level executive compensation package, and the executive employment advisor is called upon to suggest, design and then lead the negotiations for a custom executive compensation package.
My article first suggests three situations well suited to justify development and deployment of a custom executive compensation package:
My article then moves on to discuss that the custom package must not only make up for your loss of pay and benefits to leave your current employer, but even more so, to make up for three further critical intangibles as well, and hence – what should be included on your custom executive compensation package? And how much equity compensation should you ask for?
The article then concludes with my suggestions for how the executive can achieve company “Buy-in” – how do you sell the custom CEO or C-level executive compensation package to an often skeptical employer? This last part shares three of my best “sales” techniques:
To see my full CEOWorld magazine. article, go to LINK:
Or on my website at https://www.executiveemploymentattorney.com/negotiating-a-custom-ceo-or-c-level-executive-compensation-package/
This was my 31st article published in CEOWORLD over the last five years. Previously, the editor advised that I can use “Featured in the CEOWOLRD magazine” and the CEOWORLD “Logo” on my website and add CEOWORLD magazine in my LinkedIn profile’s “Experience Section” as an “Opinion Columnist.” and authority in the field. See https://ceoworld.biz/author/robert-adelson/
With more than 12.4+ million-page views, CEOWORLD magazine is the world’s leading business magazine written strictly for CEOs, CFOs, CIOs, senior management executives, business leaders, and high net worth individuals worldwide.
It is my hope that this article will be of benefit to CEOs, C-level and senior executives who are considering job offers in situations where a custom executive compensation package is appropriate. Feel free to tweet or share this article. If you or any colleague of yours has a need in this area, please do reach out to me at email@example.com.
Last Thursday, on September 3, 2020, CEOWorld magazine published an article I wrote on “Achieving Zero Taxation on Sale of Your Startup Equity”.
This new article is designed for CEOs, C-level and senior executives, who are considering taking a position in a startup or early stage company in life sciences, tech, e-commerce or another high growth area of the economy, where executive equity may comprise a major part of your compensation package.
My article discusses how taking equity in qualified small business stock may enable you to have zero Federal taxation on all or most of your appreciation on a sale of shares after 5 years. That exclusion from tax applies to not only the Federal capital gains tax but also the net investment income tax and the alternative minimum tax (AMT), on appreciation up to $10 million or 10x your adjusted tax basis in the stock, whichever is greater.
The article also includes a number of important tips to qualify your shares for this tax exclusion on sale, including the following:
To see my full CEOWorld magazine. article, go to LINK:
This was my 29th article published in CEOWORLD. Previously, the editor advised that I can use “Featured in the CEOWORLD magazine” and the CEOWORLD “Logo” on my website and add CEOWORLD magazine in my LinkedIn profile’s “Experience Section” as an “Opinion Columnist.” and authority in the field. For a library of my past article published by CEOWORLD, see https://ceoworld.biz/author/robert-adelson/
With more than 12.4+ million-page views, CEOWORLD magazine is the world’s leading business magazine written strictly for CEOs,CTOs, COOs, CIOs, CTO/CSOs, senior management executives, business leaders, and high net worth individuals worldwide.
It is my hope that this article on eliminating taxation on all or most of the appreciation on early stage or high growth stock a CEO or other C-level or senior executive receives as part of your executive compensation package may be of benefit to those currently or in the future negotiating their executive compensation and equity package, or renegotiating in a retention situation. If you or any colleague of yours has a need in this area, please do reach out to me at firstname.lastname@example.org.
Restricted stock can be offered in lieu of cash to deliver immediate value with a strike price
Restricted stock can be offered in lieu of cash to deliver immediate value with a strike price much less than current fair market value. For senior recruits, technical or executive, you want to offer more to beat the competition – restricted stock does this. Robert Adelson, an executive compensation attorney, negotiates executive compensation; in one representative case, he worked with executive Steve Miles* to set up a vesting schedule to later grant him compensation in the form of stock.
By using its stock, the company avoided cash cost, and stock offers key advantages that make equity more valuable to employees than cash. Some of these benefits are:
In addition, restricted stockholders usually provide voting rights. As a result of the benefits of restricted stock, the use of this form of employee compensation has become very popular. Since the issue of founders' shares is deductible, the company can save money that would have gone to taxes by using stock for pay. The tax windfall can also be used creatively to enhance efforts to recruit or retain key people. This is done by sharing the company's tax windfall with employees. As an executive employment attorney, Robert Adelson works with C-level executives everyday and sees that when growth is the priority, cash savings are important, and building the team is critical – stock options provide lucrative advantages for both the company and the executive.
When working with executive Steve Miles, Robert Adelson negotiated his employment compensation and set up a several year vesting plan with attainable restrictions. This allowed the company to avoid cash cost and gave Mr. Miles compensation to work and look forward to down the road. Attorney Adelson also worked with the Company to grant Mr. Miles voting rights, like any other shareholder would have. A main advantage with restricted stocks is that they differ from other stock options and still retain some value if the price were to go down.
Attorney Robert Adelson frequently represents employees and executives negotiating their executive contract terms, stock, options, relocation, non-competes, termination and separation agreements. He also represents startup and smaller companies in software, medical device and other technology-based fields, independent consultants with compensation and stockholder arrangements, incorporation and liability protection, intellectual property protection, and in vendor, client and subcontractor contracting arrangements. Executive Steve Miles was a key employee and through the negotiation of his executive employment agreement; Attorney Adelson was able to grant him a lucrative and flexible form of executive compensation.
*All dates, client’s names and companies have been altered to keep confidentiality.