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November 1, 2015Allen Bywaters Landon
Choice-of-Law Provisions and the Role of Business Relationships to Other Jurisdictions With Respect to Detrimental-Activity Clauses in Executive Compensation Plans
Exxon Mobil Corp. v. Drennen, 452 S.W.3d 319 (Tex. 2014)
May 19, 2017Allen Sparkman
Equity Incentive Compensation in Limited Liability Companies
One key difference between equity compensation in alternative entities and in corporations derives from the fundamental difference between the tax consequences of issuing equity in exchange for services in each form of entity. Receipt of stock from a corporation in exchange for services is generally taxable, absent use of an incentive stock option plan, while receipt of interests in an LLC or partnership may be non-taxable if the interests issued are profits interests.
March 4, 2016Frank Z. Ruttenberg
Compensation Strategies for the LLC
An LLC taxed as a partnership is one of the most flexible entity forms available today for allocating ownership interests. Unlike the cor porate model, where profits are allocated strictly pro-rata on the basis of the number of shares owned, management and owners of an LLC have virtually complete freedom to allocate profits among members so long as the allocation has "substantial economic effect" under IRC Sec. 704(b).
May 17, 2015George W. Coleman, John C. Ale, Cliff Ernst, Frank Z. Ruttenberg
Compensation Strategies for the LLC
An LLC taxed as a partnership is one of the most flexible entity forms available today for allocating ownership interests. Unlike the corporate model, where profits are allocated strictly pro-rata on the basis of the number of shares owned, management and owners of an LLC have virtually complete freedom to allocate profits among members so long as the allocation has "substantial economic effect" under IRC Sec. 704(b).
November 7, 2014Autumn Kraus
What Every Business Attorney Needs to Know About Family Law
This paper addresses challenging and often overlooked issues arising in the context of employment compensation.
October 23, 2009Barbara Spudis De Marigny
"But All The Popular Corporations Get To Do It": Compensating With Equity Interest In LLCs
LLCs have become a form of doing business that is used as regularly as the corporate form. In many respects, clients and their advisors do not even distinguish between the two forms of doing business and they may even believe that an LLC actually is a corporation.1 Given the similarities between the two forms, the expectation that the same compensation methods would work the same way for both entities is understandable. After all, how could LLCs have come into such common use if they did not offer the same employee benefits as corporations?