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0.4.4: Corporation Versus Limited Liability Company - Encyclopedia - Library - VC Experts |
 | | Generally, the grant of an option to purchase LLC equity to an employee does not have an immediate taxable consequence for the LLC or the employee. |
| | One fairly straightforward solution is to forestall option exercises until after the date the LLC converts to a C corporation in anticipation of an IPO or acquisition or merger. |
| | Options would "vest" under a schedule to be determined, but would not be exercisable until the "first exercise date." For option holders who leave employment prior to this first exercise date, the post-termination exercise period would continue until the conversion of the LLC. |
| vcexperts.com /vce/library/encyclopedia/documents_view.asp?document_id=41 (1339 words) |
