Comments on: Are Financial Fed execs jumping the gun on deal? http://www.footnoted.com/urge-to-merge/are-financial-fed-execs-jumping-the-gun-on-deal/ Morningstar's guide to what's hiding in SEC filings Fri, 10 Feb 2012 20:24:57 +0000 hourly 1 http://wordpress.org/?v=3.2.1 By: Dan Walter http://www.footnoted.com/urge-to-merge/are-financial-fed-execs-jumping-the-gun-on-deal/comment-page-1/#comment-10955 Dan Walter Tue, 05 Jan 2010 17:37:35 +0000 http://www.footnoted.com/?p=4458#comment-10955 While I have actually seen clauses like this several times, I have only seen them enacted a couple of times. In my experience early vesting clauses have been but in place to help defend against unwanted acquisition. Upon a potential acquisition, enough shares vest to allow the holders to regain some level of ownership control of the company. When I have seen these clauses that have generally been at very small, non-public companies who were trying to build a foundation before a big growth spurt. Pretty odd in a company the size of FF. While I have actually seen clauses like this several times, I have only seen them enacted a couple of times. In my experience early vesting clauses have been but in place to help defend against unwanted acquisition. Upon a potential acquisition, enough shares vest to allow the holders to regain some level of ownership control of the company.
When I have seen these clauses that have generally been at very small, non-public companies who were trying to build a foundation before a big growth spurt. Pretty odd in a company the size of FF.

]]> By: Michelle Leder http://www.footnoted.com/urge-to-merge/are-financial-fed-execs-jumping-the-gun-on-deal/comment-page-1/#comment-10953 Michelle Leder Tue, 05 Jan 2010 16:50:28 +0000 http://www.footnoted.com/?p=4458#comment-10953 @JR: I couldn't agree with you more. Hire the best accountant/tax attorney that you can afford and use whatever legal tricks you can to reduce your tax burden. But it still amazes me that so many executives expect someone else to pay their taxes just because their company is acquired. @JR: I couldn’t agree with you more. Hire the best accountant/tax attorney that you can afford and use whatever legal tricks you can to reduce your tax burden. But it still amazes me that so many executives expect someone else to pay their taxes just because their company is acquired.

]]> By: JR http://www.footnoted.com/urge-to-merge/are-financial-fed-execs-jumping-the-gun-on-deal/comment-page-1/#comment-10951 JR Tue, 05 Jan 2010 16:42:54 +0000 http://www.footnoted.com/?p=4458#comment-10951 Last time I remembered seeing options vest on announcement was the Sprint-MCI deal. That sure worked out well. I very much doubt there a recapture clause in this amendment to the original agreement in case the deal does not close. As to triggering these early to avoid taxes, this is just another reason to ban gross ups. If you are fortunate enough to be in a position to earn performance based equity bonuses and option awards, pay your own taxes! Last time I remembered seeing options vest on announcement was the Sprint-MCI deal. That sure worked out well.

I very much doubt there a recapture clause in this amendment to the original agreement in case the deal does not close.

As to triggering these early to avoid taxes, this is just another reason to ban gross ups. If you are fortunate enough to be in a position to earn performance based equity bonuses and option awards, pay your own taxes!

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