Structuring Profits Interests as Equity Incentive Compensation for Key Employees and Service Providers
Distribution Threshold, Vesting, Company Repurchase Rights, 83(b) Election, Rights of the Profits Interest Holder
Note: CPE credit is not offered on this program
Recording of a 90-minute premium CLE video webinar with Q&A
This CLE course will guide attorneys and advisors on critical legal and tax considerations for granting profits interests to key employees and service providers. The panel will discuss key issues regarding participation thresholds, vesting, repurchase rights, Section 83(b) election, rights of holders of a profits interest holders, financial reporting requirements, and other key items essential to structuring an effective profits interest program.
- Profits interest vs. capital interest
- Options to acquire profits interests
- Phantom arrangements
- Income tax consequences, advantages, and disadvantages
- Design, structuring, and implementation considerations
The panel will review these and other key issues:
- How does a capital interest differ from a profit interest, and what tax ramifications result from the type of equity interest granted?
- How does Section 409A apply?
- How does the Section 83(b) election apply?
- What issues arise for repurchase rights, vesting, and rights of the profits interest holder?
- How to establish safe-harbor thresholds
- Financial reporting and valuation
David Howell, MBA, ASA
A significant part of Mr. Howell's practice is in private equity and venture capital-funded companies, and he... | Read More
A significant part of Mr. Howell's practice is in private equity and venture capital-funded companies, and he specializes in valuations for equity compensation, intangible assets, buyouts, and complex securities.Close
Joseph E. Hunt, IV, J.D., LL.M.
Morse Barnes-Brown & Pendleton
Mr. Hunt has eight years of advisory and legal experience, counseling startup, emerging, and middle-market companies... | Read More
Mr. Hunt has eight years of advisory and legal experience, counseling startup, emerging, and middle-market companies throughout all stages of the entity life cycle, including formation, tax structuring, issuing equity, venture capital financing, and mergers and acquisitions. His clients span a variety of different industries at all stages of corporate development, with a particular focus in serving technology and life sciences startup companies. Mr. Hunt is a member of the adjunct faculty at Boston University School of Law where he teaches in the Graduate Tax Program.Close