CEO – Technology Company (2015-2017)

CEO – Technology Company (2015-2017)

GFA Guidance & Recommendations

Impact

  • Developed for the CEO 3 different approaches to converting stock options into equity in anticipation of a change of control event, brought in outside valuation firm, drove valuation process, able to achieve option exercise price within $0.04 of strike price.
  • Developed simple tax and cash flow model for each option exercise scenario, marginal tax rate analysis, how to present to the board.
  • Unique option exercise strategy (not typical SH loan, personally guaranteed and paid off at closing): (1) bonus strike price, (2) SH pays taxes 16 months later post anticipated transaction, SH winner, PE firm loses loan proceeds repayment.
  • Coached CEO after multiple discussions on approaching board to increase his compensation package. Ultimately they did by approximately 17%. Worked with him on closing deal bonus.
  • Ultimately retained by the company to develop a comprehensive family wealth plan for the benefit of the CEO and his family. Plan also included income tax mitigation, family and income protection, risk management regarding their property, and estate planning. Discussed use of sale proceeds.
  • Currently executing new wills, trusts, DPOA, HCP and implementing various risk management programs including life, disability, homeowners, umbrella liability, etc.
  • Compensation (ordinary income) converted into long term capital gain. Estimated savings $1.25mm, $5k fee savings.
  • Successful board approval to convert options and finance.
  • Board understood but declined.
  • $50,000 salary increase, additional $400k deal bonus (college funding).
  • Executive perk, wills and trusts executed, life and income protection being placed.
  • Home properly insured (25% under), $2k saving, $5.0mm umbrella, preferred carrier.

GFA Guidance & Recommendations

Impact

  • Developed for the CEO 3 different approaches to converting stock options into equity in anticipation of a change of control event, brought in outside valuation firm, drove valuation process, able to achieve option exercise price within $0.04 of strike price.
  • Developed simple tax and cash flow model for each option exercise scenario, marginal tax rate analysis, how to present to the board.
  • Unique option exercise strategy (not typical SH loan, personally guaranteed and paid off at closing): (1) bonus strike price, (2) SH pays taxes 16 months later post anticipated transaction, SH winner, PE firm loses loan proceeds repayment.
  • Coached CEO after multiple discussions on approaching board to increase his compensation package. Ultimately they did by approximately 17%. Worked with him on closing deal bonus.
  • Ultimately retained by the company to develop a comprehensive family wealth plan for the benefit of the CEO and his family. Plan also included income tax mitigation, family and income protection, risk management regarding their property, and estate planning. Discussed use of sale proceeds.
  • Currently executing new wills, trusts, DPOA, HCP and implementing various risk management programs including life, disability, homeowners, umbrella liability, etc.
  • Compensation (ordinary income) converted into long term capital gain. Estimated savings $1.25mm, $5k fee savings.
  • Successful board approval to convert options and finance.
  • Board understood but declined.
  • $50,000 salary increase, additional $400k deal bonus (college funding).
  • Executive perk, wills and trusts executed, life and income protection being placed.
  • Home properly insured (25% under), $2k saving, $5.0mm umbrella, preferred carrier.

GFA Guidance & Recommendations

Impact

  • Developed for the CEO 3 different approaches to converting stock options into equity in anticipation of a change of control event, brought in outside valuation firm, drove valuation process, able to achieve option exercise price within $0.04 of strike price.
  • Developed simple tax and cash flow model for each option exercise scenario, marginal tax rate analysis, how to present to the board.
  • Unique option exercise strategy (not typical SH loan, personally guaranteed and paid off at closing): (1) bonus strike price, (2) SH pays taxes 16 months later post anticipated transaction, SH winner, PE firm loses loan proceeds repayment.
  • Coached CEO after multiple discussions on approaching board to increase his compensation package. Ultimately they did by approximately 17%. Worked with him on closing deal bonus.
  • Ultimately retained by the company to develop a comprehensive family wealth plan for the benefit of the CEO and his family. Plan also included income tax mitigation, family and income protection, risk management regarding their property, and estate planning. Discussed use of sale proceeds.
  • Currently executing new wills, trusts, DPOA, HCP and implementing various risk management programs including life, disability, homeowners, umbrella liability, etc.
  • Compensation (ordinary income) converted into long term capital gain. Estimated savings $1.25mm, $5k fee savings.
  • Successful board approval to convert options and finance.
  • Board understood but declined.
  • $50,000 salary increase, additional $400k deal bonus (college funding).
  • Executive perk, wills and trusts executed, life and income protection being placed.
  • Home properly insured (25% under), $2k saving, $5.0mm umbrella, preferred carrier.

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