Employee Benefit Trusts

Employee Benefit Trusts ("EBTs") incorporating an independent offshore trustee can fulfil a number of roles for companies seeking to mitigate taxes and retain, motivate and stretch the client's management team by a well structured and efficiently administered remuneration package. The benefits of EBTs can be summarised as follows:

• Provide long term incentives to enhance the company's ability to attract and retain key executives
• Joint participation in the company's equity for those employees who are bound by certain trigger events can be an effective 'lock-in period' retention tool.
• Creating a market in the illiquid shares as part of a share incentive scheme.
• Hedge the company's exposure to its own share price prior to vesting incentives, by holding or "warehousing" shares in the company.
• Taking the assets off the employer's balance sheet and out of the hands of any potential creditors of the company, thus providing security to key executives.