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Tuesday, May 1, 2018

Becoming CEO of a Startup — Key Employment Contract, Equity Terms and Other Considerations

Last Tuesday, on April 24, 2018, CEOWorld magazine published an article I wrote on “Becoming CEO of a Startup — Key Employment Contract, Equity Terms and Other Considerations.” The magazine advised me that I can use “Featured in the CEOWORLD magazine” and their “Logo” on your website.
This article was designed for CEOs and other C-Suite, VPs or other senior executives who have achieved a level of success and who are tempted to leave an established company to take on the challenge of leading a startup, either a well-funded startup on the ground floor or an up and coming startup to the next level.

Becoming a startup CEO
My article discusses key employment contract and equity terms, including
  • Amount and terms of equity to seek,
  • Tax structure of equity if you are joining a ground floor startup,
  • Tax structure of equity if you are joining a scale-up startup,
  • Special severance terms for startup executive employment contracts.
The articles also suggest other important considerations to include in due diligence and employment contract terms including shared vision, representations as to current financial position and other representations the executive is relying upon to take the position.
It is my hope that this article will be helpful to CEOs and other senior executives who are considering joining a funded startup company, whether at the ground floor or in the scale-up stage. If you or any colleague of yours has a need in this area, please do reach out to me at radelson@engelschultz.com.

Friday, March 30, 2018

Consulting Between CEO Positions

executing consulting for CEOs and senior executives

Last Tuesday, on March 27, 2018, CEOWorld magazine published an article I wrote on  “Consulting Between CEO Positions”
This article was designed for CEOs and other C-Suite, VPs or other senior executives who have achieved a level of success and now find themselves between executive positions and might want to consider doing some consulting before accepting the next full-time job offer.

My article discusses the advantages consulting offers the CEO and other senior executives between positions, including the following:
  • Adding to your knowledge, experience and skill set,
  • Aiding and encouraging you to stay current in your field,
  • Expanding deal flow for new CEO and senior executive positions and business opportunities,
  • Lengthening your financial runway with money coming in so you don’t have to take the first position offered,
  • Enhancing your bargaining position when you find a position you like.

The articles also indicates how low cost it is to begin consulting.  At the end, the article offers half a dozen suggested steps to begin and develop a consultancy if you do want to give it a try.

The article concludes with the suggestion that if you do develop a consultancy you may want to keep it around and offers advice on how you can retain the business you created to co-exist with the full-time position after you accept a job offer for your next full time position.

To see my full CEOWorld magazine. article, go to LINK:  http://ceoworld.biz/2018/03/27/consulting-between-ceo-positions/
Or on my website https://www.executiveemploymentattorney.com/consulting-between-ceo-positions/
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 helpful to CEOs and other senior executives who are in between full-time permanent positions and might want to giving consulting a try during that interim period.  If you or any colleague of yours has a need in this area, please do reach out to me, your executive employment lawyer, at radelson@engelschultz.com.

Wednesday, March 7, 2018

Joining a board of directors as an executive can be rewarding

Joining a board of directors as an executive can be rewarding, yet has its pitfalls. Boston executive employment attorney Robert Adelson serves the role of an employment advisor to help executives weigh the costs and benefits of joining a board, as well as negotiates their compensation package. The many benefits of joining a board include but are not limited to lucrative stock and options, networking opportunities and access to a new source of information. However, despite these rewarding benefits, an executive who joins a board takes on a large task – one which, if left unfulfilled can expose them to shareholder lawsuits.
In November of 2013, executive Maxwell Vanderburgh* was asked to serve on a board of directors for an outside company, Mr. Vanderburgh’s C-level executive experience, knowledge and day-to-day management made him the perfect man for the position. When making his decision, Mr. Vanderburgh called on executive employment attorney and advisor Robert Adelson to help him advise the position and negotiate his terms. Attorney Adelson expressed the importance of understanding his rights and duties on the board and potential liabilities he could be exposed to. After Mr. Vanderburgh weighed the pros of cons of this position and realized serving on a board would advance his career and be a rewarding experience the two sat down to negotiate. Upon negotiating Maxwell Vanderburgh’s compensation package, Attorney Adelson implemented proper protections to limit risk exposure and negotiate lucrative stock and options. To ensure protection, Attorney Adelson made sure that there was proper liability insurance in place to protect executive Maxwell Vanderburgh in the event of any suit.
When negotiating the executive’s compensation package, Attorney Adelson explained the responsibilities that must be upheld by a board director; most importantly being a director’s fiduciary duty. This duty is comprised of three separate duties: a duty of care, a duty of loyalty and a duty of candor. In short, these duties require the executive to make informed decisions, act in the interest of the organization it is representing and always provide correct information to shareholders.
Executive employment attorney Robert Adelson was able to help and advise CEO Maxwell Vanderburgh on his decision to become a board director. Attorney Adelson also worked with Mr. Vanderburgh, hands on, throughout the stages of negotiation so Mr. Vanderburgh would receive a compensation package that would be rewarding as well as protect him from any potential suit.
If you or one of your colleagues is a CEO or senior executive who is considering taking on a board of director role, I am glad to assist.  Please do reach out to me at radelson@engelschultz.com.

Friday, February 9, 2018

How to Renegotiate Your CEO Employment Contract When You Have Achieved Success

Last Thursday, on February 1, 2018, CEOWorld magazine published an article I wrote on  “How to Renegotiate Your CEO Employment Contract When You Have Achieved Success.
This article was designed for CEOs and other C-Suite, VPs or other senior executives who have achieved a level of success and seek a greater share of the benefits his or her leadership has brought to the company, as well as a refresh of the level of incentives as he or she takes the company to the next level.

My article discusses why the Board would agree to sweeten the package for the CEO (or other senior executive), including these reasons:
  • Fear of losing a successful executive,
  • Costs of recruiting a replacement,
  • Disruption to a successful team,
  • Uncertainty of how a successor would work out,
  • Loss of momentum as the company goes through a new transition, and
  • Loss of promise of where the CEO might take the company if allowed to build on his or her success.
The article then suggests key items to seek in negotiations, and offers suggestions on negotiation strategy to improve chances for a successful outcome.
Among the strategies suggested are to plan and develop a back-up to enhance your bargaining position and also for possible use if negotiations don’t succeed, and finally use of an “ace in the hole” to achieve success.

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 helpful to CEOs and other senior executives who have achieved a level of success on the job and deserve and would like to seek a share of the benefits their success has conferred to owners and shareholders and refresh of incentives as they seek to take the company to the next level.   If you or any colleague of yours has a need for advice in this area, please do reach out to me, executive employment lawyer, Robert Adelson, Esq. at radelson@engelschultz.com.

Monday, November 6, 2017

Interim CEO and Turnaround CEO Employment Agreements: Terms and Compensation

On October 26, 2017, CEOWorld magazine published an article I wrote on “Interim CEO and Turnaround CEO Employment Agreements: Terms and Compensation.”

This article was designed for executives, who have been offered, are seeking or are now considering taking Interim CEO or Turnaround CEO positions.

The Interim CEO may be one of the following:
  • company insider from the Board or current executive suit or a current consultant to the Company, as Interim CEO, chosen in part for familiarity with the company and essentially to be a placeholder until the new CEO can take up his or her duties
  • executive outside the company recruited to fill that role, someone with a name in the field to maintain the position of the company in the eyes of analysts and investors until the search for a new CEO is completed and the replacement installed
  • an executive hired or recruited not just as a placeholder but as a true Turnaround CEO, who is being brought in to “right the ship” when a company is in turmoil, unprofitable or otherwise not performing to the desired level.


This article discusses the different roles each would play as Interim CEO or Turnaround CEO and the different terms each should seek in employment, compensationseveranceequity, disclosure and indemnification from the company that needs their services.
or my website https://www.executiveemploymentattorney.com/interim-ceo-and-turnaround-ceo-employment-agreements-terms-and-compensation/

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 helpful to senior executives who are navigating the shoals of noncompete, nonsolicitation agreements and going into a new position or change of control. If you or any colleague of yours has a need in this area, please do reach out to me at radelson@engelschultz.com or 617–875–8665.

Monday, September 11, 2017

Phantom Stock as a Way to Get 'Equity Compensation' from Family Businesses

On September 6, 2017, CEOWorld magazine published an article I wrote on “Getting the Benefits of Equity Compensation from Family Businesses through Phantom Stock.

Phantom stock for executive compensation
Photo credit: dotshock
 
This article was designed for CEOs, C-suite executives and other senior executives who currently work in a family business or are offered a position in a family business and receive now or are offered NO 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 that stock, options or RSUs would provide to the executive in a non-family business.

Techniques used in the past and offered to the reader can produce a true “win-win” by providing key benefits to the family business as well as to the CEO or other senior executive, including the following
  • For the Family Business: Creates key executive recruitment tool to offer stake in growth and effectively compete with equity offered by non-family businesses, plus “golden handcuffs” to retain the services of senior executives over the years
  • For the Family Business: Provides this tool with no usage of actual stock or options and no rights as stockholder of company
  • For the Family Business: All payments made under the plan are fully tax deductible to the family business.
  • For the Executive: Gives executive a meaningful stake in the growth of the business, a true share of what the executive achieves for the business
  • For the Executive: Provides a liquidity feature often missing in stock plans of private companies.
  • For the Executive: Phantom Stock Plans can be structured to replicate options or RSUs, and can also be structured to offers the possibility for capital gains level taxation, in after tax income achieved
My article includes a hypothetical example, where a 55-year-old executive is to take the CEO position as successor to the 75-year-old family CEO.  In this example, the successor CEO negotiates for the establishment of a phantom stock plan as a condition to taking the position.  The intention is that the successor CEO receive phantom stock under the phantom stock plan as an important part of his (her) executive compensation package and that the plan would continue after that to enable the successor CEO to use phantom stock to recruit other non-family senior executives to further bolster management of the family business.

To see my full CEOWorld magazine. article, please go to my website:
https://www.executiveemploymentattorney.com/articles-section/getting-the-benefits-of-equity-compensation-from-family-businesses-through-phantom-stock/

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 helpful to (1) CEOs and senior executives working in family businesses, (2) CEOs and senior executives considering taking positions in family businesses, and (3) leaders of  family businesses seeking to recruit non-family members as the new CEO or other senior executives.

If you or any colleague of yours has a need in this area, please do reach out to me, your executive employment lawyer, at radelson@engelschultz.com or call 617-875-8665.

Sunday, August 13, 2017

Pitfalls of and Techniques to Surmount Non-Compete Agreements for Executives

Last Thursday, on August 10, 2017, CEOWorld magazine published an article I wrote on “Pitfalls of and Techniques to Surmount Non-Compete Agreements for Executives.” This article was designed for CEOs, C-suite executives and other senior executives who are asked to sign non-compete agreements with their company.  My article deals with both the coverage and pitfalls of non-competes but also offers key techniques for the CEO and senior executives to surmount non-competes and protect your career.


Executive considering non-compete agreement




Techniques used in the past and offered to the reader include negotiation of the following

  • Fully “Paid up” non-compete to make the Executive whole,
  • Planning to navigate around the shoals of the non-compete terms,
  • Use of an indemnity from the new employer.
My article also discusses key terms for the executive to negotiate in covenants for non-solicitation of customers and clients, non-solicitation of employee and contractors, confidentiality and NDA agreements, and assignment of inventions.

To see my full CEOWorld magazine article, go to http://ceoworld.biz/2017/08/10/pitfalls-of-and-techniques-to-surmount-non-compete-agreements-for-executives/
or my website at http://www.executiveemploymentattorney.com/articles-section/pitfalls-surmount-executive-non-compete-agreement/

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 helpful to senior executives who are navigating the shoals of non-compete, non-solicitation agreements and going into a new position or change of control.  If you or any colleague of yours has a need in this area, please do reach out to me at 617-875-8665 or email radelson@engelschultz.com.