I hope this email finds you and your family in good health.  We are now into March, with this executive employment law newsletter reaching you on March 4th, which date has a place in US history. On this date, on a cool mostly cloudy afternoon in Washington D.C. 92 years ago, March 4, 1933, Franklin Delano Roosevelt took the oath of office to become the 32nd U.S. President.  He told a nation, during some of the worst days of the Great Depression, that the “only thing we have to fear is fear itself”. With his courage, candor, intelligence, and indomitable spirit, he would go on to lead America through those hard days and then through World War II that would follow, as our nation’s longest serving President.  See link – https://www.youtube.com/watch?v=khFwYWWF6Tc

Meanwhile winter continues.  For those like my wife who relishes her winter sports, I do hope there will be sufficient snow and ice this last month of winter.  For those like me who look forward to warmer weather, perhaps you will get a chance to sneak off for time in the sun in warmer places.
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March madness will soon begin and to all with your brackets and betting favorites, and for those out there with alma maters in the NCAA Basketball Tournament  – all best of luck! For my two tournament-eligible alma maters, this has not been the best of years, but both still do nurse their slim NCAA Tournament chances. Boston University – with four Patriot League wins in its last five games, the Terriers will host Navy in a first round PL tournament game at the “Roof” this Thursday.  Northwestern, after recent 20-win seasons, has been well below that this season, near the bottom of the 18-team “Big Ten.”  However, with 3 recent Big Ten wins, the Wildcats may finish among the top 15 to at least compete in the Big Ten Conference Tournament, March 12-16 in Indianapolis. So, hoping both BU and NU can stay hot through their respective Conference Tournaments though both are long shots for the 2025 Big Dance.

Meanwhile in men’s college hockey, BU won the Beanpot 4-1 in an upset over BC at TD Garden on Feb. 10, but BC remains firmly no.1 atop the college ice hockey national rankings. Hockey East remains strong with five New England college teams ranked among the top ten in national polls. So perhaps we will see a rare all-Eastern final at the Frozen Four in St. Louis April 10 to 12. All the while, in our professional winter sports, the Bruins are struggling and the Celtics are having a solid season and we can hope both will make the playoffs with a decent playoff run for the Celtics beginning next month. The Celtics will be defending their NBA championship but competition will be stiff.

As for Newsletter items, last week, CEOWORLD magazine published an article of mine on FAQs – my answers to Frequently Asked Questions that I receive on executive compensation, executive equity and negotiations.  Further into this March Newsletter, items #3 and #4 are two older articles of mine, both published in IVYEXEC career advancement website,#3 published in 2022 on leveraging  your strengths in negotiating for key terms in executive retention packages, #4 published in 2023 on terms to negotiate for in your new job offer or employment contract as a Chief Technology Officer (CTO) or a Chief Information Officer (CIO). Item #5 is a special offer also on executive retention. As always,  I hope some of these items might be of interest and  benefit… and my best wishes to all for the rest of March!

This almost 4-weeks value-packed offer, is as a way to get introduced to my law work: Executive Employment Retention Law Diagnostic — this offer is good through 3/31/25.   More Details Here
It’s always a pleasure to get back in touch with you and other clients, friends, and colleagues.  I hope the links and information provided will be useful to you and that there will be an opportunity for me to work with you on legal matters in the near future. 
Let’s keep in touch! 
Best regards,
Rob
Robert Adelson

*Adelson & Associates, LLC
Executive Employment Attorney
101 Federal Street, 19th Floor
Boston, MA 02110
(617) 204-5601 Law Firm
(617) 204-5602 Direct
(617) 204-5604 Fax
E-mail :  [email protected]
Blog:  https://robadelson.wordpress.com/
Twitter:  @AttorneyAdelson
LinkedIn: https://www.linkedin.com/in/robert-adelson-b8a1557/
Website: www.executiveemploymentattorney.com
Note on Adelson & Associates, LLC:
*As mentioned in bullet no. 2 of the January 2020 Business Law Newsletter, Robert A. Adelson is now the Principal of Adelson & Associates, LLC.  For fifteen (15) years, from October 2004 through December 2019, Robert Adelson practiced law and referred legal work to associates of his, trusted and experienced colleagues, as a partner of Engel & Schultz, LLP.  In December 2019, the lead partners of the firm announced they would go into semi-retirement, go their separate ways, and the office lease would expire in January 2020.  In response, Robert Adelson formed Adelson & Associates, LLC in December 2019 and commenced the new firm’s operations on January 1, 2020, with the new firm taking over, on that date and going forward, all current Robert Adelson clients, matters and operations, as well as all referral of legal work to associates of Robert Adelson.  The new firm’s offices, at 101 Federal Street, 19th Floor, are across the street from the prior offices at One Federal Street, 21st Floor, in Boston’s Financial District.

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: 

• Meaningful Level of Equity – to be sure that sufficient equity is granted so that if success is achieved, it will be impactful for you,
• Tax Favorable Structure – negotiation over the form of your equity at the outset is quite important because in tax law – “form is substance” – different forms produce very different tax results and you want tax-favored equity if possible,
• Severance Protection – if midway through the buildup you are forced out, you want your severance buy-out to embrace your equity as well as less important cash components of your comp package,
• True Up Adjustment – especially if you are brought in to secure a financing raise, you don’t want to be a victim of your own success and seeking a level anti-dilution protection is a fair ask,
• Cash-out protections – if after a number of years, no liquidity event is on the horizon, it is helpful to have a put option with the company to assure at some point you can tap into the value you achieved.

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/
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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/

One week ago, on Wednesday September 1, 2021, the website Ivy Exec published under “Business Strategy” an article I wrote on “Phantom Stock as Executive Compensation for Family Businesses.”

​This new article is designed not only for C-level and senior executives, but even for many directors and mid-level executives, who currently work in a family business or are offered a position in a family business and received NO executive equity compensation because most family businesses do not issue equity to non-family members.

My article discusses the use of phantom stock as a mean to give the executive a substitute to equal for him or her all the benefits of stock, options or RSUs. This technique also benefits the family business by not only avoiding use of actual stock and offering a key executive recruitment / retention tool but also providing a technique where all payments are tax deductible.
The technique is highly beneficial to CEOs and senior executives because it not only gives him or her a meaningful stake in the growth of the company, but also offers the possibility for capital gains level taxation, plus a liquidity feature often missing in stock plans of private companies.
To see my full IvyExec Career Advice website article, go to LINK: https://www.ivyexec.com/career-advice/2021/phantom-stock-as-executive-compensation-for-family-businesses/
Or https://www.executiveemploymentattorney.com/phantom-stock-as-executive-compensation-for-family-businesses/
IvyExec hosts articles and webinars from experts in the career, leadership, and business spaces who wish to share their knowledge with our audience. In April 2021, I was invited to write for IvyExec since it seeks original content on the topics of career development, leadership, and business strategy as it applies to senior-level and C-Suite professionals. IvyExec blog posts and webinars are shared with its community of more than 2 million members on its website, in its newsletter, and on its social media channels. https://www.ivyexec.com/career-advice/write-for-us/
It is my hope that this article will be of benefit to C-level and senior executives who have the opportunity or should have the opportunity to gain an equity stake in the family businesses that their management skills and efforts or helping to build, so that you along with the family owners can share in the benefits of that company growth.
Family business owners do have good reason to avoid taking on minority owners, but that does not mean you, as the non-family executive, need to be deprived of the kind of equity or equity-like stake you would receive in a non-family business. My article suggests a way to do this — to the benefit of the non-family executive and the family business owners too. 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.

Last Wednesday, on March 31, 2021, the day before Major League Baseball’s Opening Day for the 2021 baseball season, CEOWorld magazine published an article I wrote on “Don’t Let Misalignment in Executive Compensation Create Your Own “Black Sox Scandal”.
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This new article is designed for CEOs, C-level and senior executives, who may face misalignment in the structuring of their executive compensation, incentive and performance-based compensation.

The article first discusses misalignment as commonly mentioned that can harm the interests of investors, owners and shareholders, where executive compensation incentives revenues and earnings per share that can encourage acquisitions that can benefit CEOs but not add long term value and might actually harm the interests of the investors.

My article then moves to discuss the less often recognized issue of misalignment that can harm CEOs, C-level and senior executives. Major misalignment of executive compensation is discussed in the three circumstances, as follows:

• Added performance targets are set even after liquidity occurs as approved by the investors,
• A major portion of equity is tied to remaining in the position until liquidity occurs, and
• Tying an entire bonus to the achievement of a single fixed objective, where the owners have significant discretion to limit or even eliminate the executive’s ability to achieve that sole objective.

I timed publication of this article to coincide with Major League Baseball’s Opening Day, because the 3rd and last example of misalignment harmful to executives, and certainly one of the most flagrant, was the root cause of the biggest scandal in American sports history, when Chicago White Sox players accepted bribes from gamblers to intentionally lose the 1919 World Series. This “Black Sox Scandal” offers a vivid demonstration how such executive compensation misalignment can harm both executives and players in this case and also the company, owner and other stakeholders (in this case the fans) as well.

My article then ends with recommendations for executives to adopt in their executive compensation negotiations to avoid harm from such destructive misalignment,
To see my full CEOWorld magazine. article, go to LINK: https://ceoworld.biz/2021/03/31/dont-let-misalignment-in-executive-compensation-create-your-own-black-sox-scandal/

Or on my website at https://www.executiveemploymentattorney.com/dont-let-misalignment-in-executive-compensation-create-your-own-black-sox-scandal/

This was my 32nd 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.
CEOWORLD magazine | LinkedIn

It is my hope that this article will be of benefit to CEOs, C-level and senior executives who are engaged or will soon engage in negotiations over the terms of their executive compensation, incentive compensation and performance compensation. It is my hope that this article may be helpful to you to avoid executive compensation misalignment potentially harmful to the executive. Feel free to share this article. If you or any colleague of yours has a need in this area, please do reach out to me at [email protected].

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.
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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.
 
Or https://www.executiveemploymentattorney.com/wp-content/uploads/2021/01/Attorney-Rob-Adelson-in-Casino-CEOs-trade-bonuses-for-stock-Las-Vegas-Review-Journal.pdf

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.   
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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/   
or http://www.executiveemploymentattorney.com/articles-section/the-advantage-of-rsus-in-your-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 [email protected].