Sep
29
Employee Share Ownership: Shareholder Question
by Eric Lehner
.QUESTION:
“Does the company have a formal policy on employee entitlement to share ownership; or choosing shares in lieu of salary/wages?”
ANSWER:
As a matter of policy, Winning Brands has never issued shares to employees in lieu of normal compensation. Employees are compensated competitively for the local employment market and paid for full time employment. All employee compensation is up-to-date. Employees acquire, as a bonus, access to common shares through a vesting period (as opposed to simply being “given” shares without proving their commitment to the company). The only shares issued to employees to date are restricted shares. No such shares have yet been converted from restricted status to free trading shares.
Persons who resign from employment may retain the shares if their vesting period has been satisfied.
Persons associated with the firm in a commercial relationship for sales services rendered and who do not carry out their work from the company’s business office, such as Key Account Managers living in various markets, are not employees as defined by employment law, and do not receive a salary. There is a commission arrangement in such cases, with expense reimbursement. Such persons are nonetheless part of a close collaborative team and are also eligible for the vesting of common shares through time and work as well. We have strong respect and appreciation for such team members, whose self-confidence and entrepreneurism enable the commission basis for the relationship. The commission basis is mutually beneficial. It reduces company overheads during the early stages of growth while on the other hand providing an above average possible return to the sales associates if/when the breakthroughs come. An example of a person in this category is Steve Fantus, whose permission I have to name for illustration purposes.
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