Integrating Equity Compensation With Your Financial Plan

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Helping Unlock the Full Potential of Your CONCENTRATED STOCK HOLDINGS:

Tailored Solutions for Shareholders with Concentrated Positions

Are you a founder, executive, or investor with a substantial stock position in a public company? Our specialized services are designed to empower you in navigating the complexities of concentrated stock positions. Whether you're considering Pre-IPO & M&A Planning, Wealth Management & Financial Planning, ISO & NQO Stock Option Planning, or other strategies, we have you covered.

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You’re Invited: Planning For Liquidity

Are you a past or present employee of a public company and have questions on how to manage a concentrated stock or stock option position? Please join us for our monthly call series: Planning For Liquidity & Concentrated Equity Risk Management. The topics of conversation are:

  • Pre-IPO & M&A Planning
  • ISO & NQO Stock Option Planning
  • 10b5-1 Plans
  • 83b Elections & Rule 144 Services
  • Seeking to minimize potential trading liability
  • Navigate complex stock positions in retirement
  • Ways to manage your new found wealth
  • Helping maximize your stock to maximize your wealth

Date & Time: 2/27 at 12 PM & 4 PM ET

Register for 12 PM ET Register for 4 PM ET

Hosted By:

Timothy Davis, CFP®
Founder, Partner & Executive Managing Director
Michaelyn Bortolotti
Partner, Vice President & Wealth Manager


A Stock Option Success Story

“In 2018, we engaged a member of the management team of a Boston-based Biotech company that had an IPO of that year. John Doe had been awarded stock options the year before with a 4-year vest. In year one, based on the value of the stock in December of that year, his equity was worth $900,000. He had future vests of that same amount, assuming a stable stock price, in 2019, 2020 & 2021. John engaged us to help him determine at what price the stock would need to reach for him to send his children to college, pad his retirement and possibly purchase a second home.”

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The first step we took with John was to build a financial plan that would help him to determine the number he would need to achieve his primary goals. It was determined that he would need approximately (fill in the number - $1.5 million?) in after-tax money from his company stock to achieve his primary objective of sending two kids to college and padding his retirement. John was a Section 16C officer of his company which means he was subject to trading restrictions on his company stock and stock options. He was eligible for a 10b5-1 Plan as required by the company to buy or sell stock in that company. With the help of our team, John designed & implemented a 10b5-1 plan that was set in place for the time period of one year. The advantage of a 10b5-1 plan is that it sets forth a pre-determined sales plan that executes on the following parameters: Date, Price, Share Amount. As long as the plan is not changed, altered or canceled, John’s stock will execute within the pre-set parameters within the one-year time frame it is in place. Later on in 2019, the stock price hit the limit of John’s plan and he was able to sell (fill in the number - $1 Million) worth of stock. Over the life of his plan, he was able to sell in excess of $1 Million of stock which achieved his goal for his kid’s education and retirement goals.

For the next couple of years, John was able to execute additional transactions on his equity holdings through the use of a 10b5-1 Plan and Open Window periods. In 2021, the stock peaked out but from there it was the beginning of  a long, slow decline for the stock. In 2022, the company experienced set-backs with its R&D and the company was effectively shut down with the end result of the stock declining to under $.10/share.

The story does have a happy ending as the executive was able to sell off a seven-figure amount of stock through thorough planning and discipline. He was also able to dollar-cost-average out of the stock while it was still highly appreciated fulfilling some of his financial goals. Had he done nothing, the stock options would have ended up being worthless and the payoff of working at a successful biotech startup (at least in the first few years of its existence) would not been a positive experience.