Primer on Equity Based Compensation Plans
Business owners who set up employee incentive plans generally do so to motivate their employees to work harder and smarter. Employee incentive plans also:
* Reward employees for performing (currently and in the past) at a superior level.
* Motivate employees to increase the value of the company.
* Help retain employees through the owner’s exit from the business.
* Begin transferring ownership in anticipation of an owner’s physical departure from the company. This is usually an early step in the exit planning process after the owner has decided to transfer to insiders.
Read more in this article by John Brown found via California Estate and Business Law Blog post.
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