Delivering Effective Equity Compensation Plans
Many of our most successful clients have found that equity sharing outside of their retirement plans helps align the motivations and performance of their employees with their company’s strategic plan for long-term growth. Many employees are looking for a stake in the outcome.
We can guide you through the readiness, tax, ERISA and design aspects of tailored programs to meet strategic goals.
Since organizations vary so much in size, complexity of capitalization and workforce composition, there is no one ideal equity compensation plan. Guidance through the design and implementation of equity-based compensation arrangements is best approached from a perspective of how will this support your goals. We’ll listen to your objectives and concerns and work with you to design a plan that meets them.
The available alternatives include true stock arrangements and stock-related plans (or quasi-equity arrangements) that do not provide employees with actual shares of stock, but with cash compensation tied to or determined by the value of the company’s stock. Often, a combination of plans is necessary to reach the right groups of employees. We can evaluate or help create:
- Nonqualified stock options (NSOs or NQSOs).
- Incentive stock options (ISOs).
- Restricted stock arrangements.
- Stock-loaded rabbi trusts.
- Stock appreciation rights (SARs).
- Phantom stock plans.
We’ll be your partner, guiding you through the process of assessing the viability of a stock-based strategy by identifying the “equity readiness” of various employees and then designing solutions to target the right type and amount of equity sharing and incentives to support your company’s goals.