Stock Options: Nonqualified vs. Incentive

Guest post by Joe Wallin – Carney Badley Spellman, P.S.

I have written a bunch of different posts over time on the different types of equity incentives a startup or emerging company can offer its workers. Below is a list of some of them.

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Economics 101

Joseph W. Bartlett, jbartlett@reitlerlaw.com, Counsel, Reitler Kailas & Rosenblatt LLC

The question arises in my mind whether a summary index could be organized to track and elevate it to its proper place and level of influence that portion of the U.S. economy composed of the contributions to GDP and other economic indicators from the activities of emerging growth companies (called “EGCs” or “gazelles”) and their principals, the index helping all hands, including the Fed and Treasury economists, to adjust their view of economic growth in the U.S. to take into account small business creation and operations as a vital element of the economy, an element which often is overlooked when forecasting overall GDP and constituent elements such as job creation. As a business/academic colleague of mine likes to say, you can only measure what can be measured. The question is whether one can measure the impact of the start-up economy once one is shown the ropes, so to speak, and to adjust the snapshots and forecasts of U.S. growth accordingly.

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Work Horse Redux

Joseph W. Bartlett, jbartlett@reitlerlaw.com, Counsel, Reitler Kailas & Rosenblatt LLC

What I have described as the “Work Horse” in early stage finance is a convertible note, bridging the investor into a discounted piece of the next, presumably institutional round of financing …the Series A, let’s say. Herewith some thoughts on that subject; I am plagiarizing from what I currently have in print (see https://josephbartlettvc.com/2015/08/21/the-work-horse-in-early-stage-financing, and am repeating myself in order to emphasize an often overlooked rationale for this structure. And, for purposes of simplicity, I am not including what would call the West Coast version of the Work Horse, the SAFE https://blog.vcexperts.com/2015/03/03/better-safe-than-sorry-a-new-way-to-finance-start-ups/.

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