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Lobbyists for so-called unicorns have persuaded Republicans in the House to allow private company employees to wait up to five years before owing taxes on stock option gains — but the Senate plan forces everyone to pay as soon as share grants vest.
The 400-plus-page House draft bill released November 2 by the House included a provision, 409B, that triggered taxation whenever any payment or award became vested for all companies, public and private. READ MORE
The Senate's tax proposal would disrupt the disrupters: By taxing stock options at the time of vesting, rather than when they're exercised, the change would push startups toward cash compensation. Venture capitalists say that would be expensive and harmful to innovation. But the reality is that changes in Silicon Valley financing culture over the last decade have made equity compensation a bad deal for startup employees, as I can personally attest, so this policy change would probably be good for workers. READ MORE
Tucked into the mammoth tax bills Congress is debating are two provisions that will increase the taxation of executive compensation and undermine related governance practices. Corporate directors and senior managers, take note.
For starters, the Senate bill would virtually eliminate the ability of a company’s employees to defer the taxation of their compensation. Both the House and the Senate bills would severely limit the ability of corporations to deduct awards of performance-based compensation to their top five officers. READ MORE
Michael Karp, chief executive officer and founder of Options Group, discusses Wall Street compensation and the impact from technology. He speaks with Bloomberg's Julie Hyman and Mark Barton on "Bloomberg Markets." VIEW VIDEO
On November 9, 2017, the House Ways and Means Committee approved the House’s version of the tax reform bill (the “House Bill”) and voted to report it to the House floor for a full House vote. On the same day, the Senate Finance Committee released the Description of the Chairman’s Mark of the “Tax Cuts and Jobs Act” (the “Senate Finance Committee Mark”), which sets forth a summary of the Senate’s proposed tax reform legislation. The Senate Finance Committee Mark will be marked up by the Senate Finance Committee beginning Monday, November 13, 2017. READ MORE
You value your team. That’s why you put together a compensation package that includes a competitive salary, generous benefits and even the occasional rooftop happy hour. But, if you add in a few more key elements, you’ll create a compensation strategy that helps you connect emotionally with your employees, keep your existing team motivated and attract the right candidates when it’s time to grow. READ MORE
A proposed tax that charges people as their startup equity vests instead of when they cash it out and actually have money to pay the taxes could wreck how tech companies recruit talent. And the industry doesn’t have much time to mobilize to get this tax changed. READ MORE
The NFL's Compensation Committee will hold a conference call Monday to discuss and further push ahead the proposed extension for commissioner Roger Goodell, sources confirmed to ESPN. READ MORE
In the world of executive compensation, one idea has long been considered gospel. Chief executive pay, companies say, is tied to the returns they produce for shareholders, and the "pay for performance" concept is used to defend the lofty stock-based compensation that makes up the majority of most large public companies' pay packages. READ MORE
Efforts to conserve an equity plan’s share reserve should begin the day the issuer’s stockholders approve the plan (or share increase), and should continue going forward. Issuers that do not make such efforts tend to face problems relating to dwindling share reserves, including moving to cash-based programs, hiring proxy solicitation firms to garner stockholder support for share increases, and overcoming possible negative reactions from ISS. READ MORE
What can a person do that is worth a third of a billion dollars? A retirement announcement from Kenneth Chenault, chief executive of American Express, prompts the question. This month he said he would leave the company next year, after 17 years as chief. His compensation as CEO to date runs to $370m in shares and cash, an average of $22m a year. READ MORE
Oracle Corp.’s attempt to respond to investor complaints about excessive executive compensation by awarding its three top bosses pay packages worth more than $100 million didn’t please proxy adviser Institutional Shareholder Services Inc. READ MORE
Executive compensation is one of the many things John Flannery plans to shake up as he tightens the belt at General Electric Co. But his options may be limited. READ MORE
As compensation for corporate directors shifts more towards paying outside experts for their contributions, S&P 500 board members got a raise of almost $5,000 in 2016, reaching a median of $254,700, according to a study by Mercer, a consulting firm. The biggest winners work in the tobacco industry, led by Louis Camilleri, the non-executive chairman of Philip Morris International (PM - Get Report) , who earned more than $2.7 million in 2016, according to analysis by BoardEx, a relationship mapping service of TheStreet Inc. READ MORE
There's no easy spot on the executive board, but with technology and cybersecurity at the forefront and splashed across headlines, CIOs' jobs aren't getting any easier. READ MORE
Marc Lore — pronounced “Lorry” — was awarded more than $242 million worth of stock when the online retailer he helped found, Jet.com of Hoboken, New Jersey, was sold to Wal-Mart Stores Inc. in August 2016 for $3.3 billion. Lore then joined Wal-Mart as an executive vice president to run the Bentonville discount chain’s most ambitious assault on the competitive threat that is Amazon, adding another million or so to his total compensation. READ MORE
As new compensation allocations take effect in the new year, firms should ensure they are paying partners in accordance with their true economic contributions. READ MORE
Equifax could announce in coming days that it will claw back compensation from some top executives over its massive data breach, a person familiar with the matter said. READ MORE
Public companies commonly use their equity as a component of incentive compensation awarded to their executives and other employees.
Under Nasdaq Listing Rule 5635(c), prior stockholder approval is generally required before a listed company may issue shares under an equity compensation plan or other arrangement. To satisfy this requirement, public companies typically adopt and obtain stockholder approval of an incentive plan that provides for a reserve of shares that may be issued pursuant to various enumerated types of awards. READ MORE