Ryan Harvey and Bryan Smith
As private companies prepare for their market debuts, they make changes in their equity compensation programs. This article looks at some of the shifts you can expect in your stock grants both during the period leading up to your IPO and after your company goes public.
Edwin L. Miller, Jr.
Stock options and restricted stock in pre-IPO companies can create substantial wealth, but you need to understand what might happen to your stock grants in venture capital financings, in an acquisition, or in an initial public offering. While Part 1 looks at venture financings and M&A deals, Part 2 analyzes IPOs.
myStockOptions.com Editorial Staff & Contributors
UPDATED! Finding legal techniques to minimize taxes is almost as popular in the US as stock compensation. These sophisticated techniques with founder's stock and options can defer or reduce taxes.
Joanna Glasner and Bruce Brumberg
Don't be discouraged by stock market volatility and underwater stock options. As the experts note, stock grants are tools for building wealth in the long term.
Peter Delevett
San Jose Mercury News
The IPO upside has a dark side too. New stock grant riches for employees can pose problems at work after the company has gone public.
Helen Shaw
CFO.com
You think your company is going public soon, but instead it might be acquired.
Kathleen Pender
San Francisco Chronicle
Varying tips from experts on how to profit (or avoid mistakes) with your stock options in an IPO.
Return to top of this page
You can expect SEC and contractual restrictions on your freedom to sell your company stock immediately after the public offering. The exact number of days until you can sell depends on...
Valuation of stock in pre-IPO companies remains as much an art as a science. However, as the company nears the actual IPO, reliable benchmarks exist...
Companies have flexibility in setting the conditions on which their stock grants can vest. This allows your company to base the vesting of your grant on...
This can depend on whether you are still affiliated with the company. For options and stock issued under Rule 701, Rule 144 requires you to wait at least...
The vesting of the grant will probably accelerate according to specifics in your stock plan or grant agreement. The grants will probably be cashed out. Depending on your level in the company and the length of your employment, you may receive a meaningful grant in your newly private company that will require you to...
When you set up a Rule 10b5-1 trading plan, one of the key requirements is that you must not...
Yes. A consultant to a private company needs to find out whether the options or shares...
You will face a lockup when your company goes public, or perhaps in an acquisition. A lockup is a contractual restraint on...
Yes. Sometimes an underwriter will release a portion of the lockup shares for sale before the lockup period expires...
Lockups prevent you from selling the shares, but you still own them, and the tax-treatment date is not deferred...
You take this risk in a pre-IPO situation, when valuation...
Except at times when a number of affiliates will simultaneously sell a portion of their stock, a public company is unlikely to register an affiliate's stock for resale...
The SEC Rule 144 requirement that current public information about the company be available is met if the company has filed all the required reports under the Securities Exchange Act of 1934...
Tracking stock is a separate class or series of common stock of a corporation...
You need to show that resale does not require you or your company to...
Return to top of page
Tax errors can be costly! Don't draw unwanted attention from the IRS. Our Tax Center explains and illustrates the tax rules for sales of company stock, W-2s, withholding, estimated taxes, AMT, and more.
