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MORGAN STANLEY PRIVATE WEALTH MANAGEMENT
555 California Street, 14th Floor
San Francisco, CA 94104
T H E M C G E E T E A M AT M O R G A N S TA N L E Y P R I VAT E W E A LT H M A N A G E M E N T
A p r i l 2 0 1 4
C L I E N T S N A M E
MICHAEL MCGEE, DIRECTOR
PRIVATE WEALTH ADVISOR
415.576.3186
MARCO SALERNO
FINANCIAL ADVISOR
415.955.1661
2
A B O U T P R I V A T E W E A L T H M A N A G E M E N T
Founded in 1977, Private Wealth Management is the division of Morgan Stanley
that is dedicated to serving the firm’s most affluent clients. PWM advisors utilize
a customized wealth management approach best suited for ultra high net worth
families and provide sophisticated solutions, through an open architecture, that
leverage the intellectual capital and insight of Morgan Stanley’s substantial global
resources. Today, clients from around the world entrust Private Wealth Management
with over $185 billion in assets with the goal of preserving and growing their financial,
family and social capital across generations.
1 As of February 2012.2 Includes overseas affiliates.
3
1 As of 31 December 2012Morgan Stanley Smith Barney LLC (Morgan Stanley Wealth Management), its affiliates, and Financial Advisors and employees are not in the business of providing tax or legal advice, and these materials and any statements contained herein should not be construed as tax or legal advice. Individuals are urged to consult their personal tax advisor or attorney for matters involving taxation and tax planning and their personal attorney for matters involving trust and estate planning and other legal matters.
W H Y W E A L T H Y F A M I L I E S C H O O S E M O R G A N S T A N L E Y
P R I V A T E W E A L T H M A N A G E M E N T
RETAIL BROKERAGE
Broad range of sophistication
and client experience
Access to some franchise and
institutional resources may be
limited to valued clients
Standard product and service
offerings; typically limited
customization
Retail pricing
Specialized services and
solutions tailored to the needs
and complexities of each
client
As a boutique group within a world-class
firm, Morgan Stanley Private Wealth
Management is well positioned to serve
ultra high-net-worth individuals, families
and their foundations around the world.
MORGAN STANLEY PRIVATE WEALTH MANAGEMENT
• Over 350 Private Wealth Advisors located in 40 offices across the U.S.1
• Special focus on individuals and families with $20mm+ in investable
assets
• Boutique division providing highly customized solutions and tailored
wealth strategies
• Team coverage with intensive client service
• Direct firmwide access to analysts, strategists, traders and investment
bankers
• Objective and consultative approach with one of the largest third party
platforms as well as an extensive Morgan Stanley proprietary platform;
Holistic wealth management approach with an expertise in complex
financial structuring, tax/estate strategies and family office services like
philanthropy and family governance
• Exclusive client events and educational programs for small groups of
ultra-high-net-worth individuals
PRIVATE BANKS (PROPRIETARYPRODUCT-DRIVEN)
Service-oriented approach
Centralized investment advice
Offering focused on
proprietary products
High turnover of advisors
Emphasis on trust
administration and sales over
investment expertise
High touch, low content
CONSULTANT ANDSMALL INDEPENDENTS
Objective, consultative
approach
Open architecture: product
offering primarily from third-
party providers
Ability to perform research,
asset allocation, manager
search & selection, due
diligence
Customized but limited risk
management assessment
Structured investments, trust
& estate, cash management
functions typically outsourced
Limited global reach
Characteristics that you may find at some alternative firms:
4
M O R G A N S T A N L E Y G L O B A L F O O T P R I N T
EUROPE
France | Germany
Greece | Hungary | Ireland
Italy | Luxembourg
Netherlands | Poland
Spain | Sweden
Switzerland
United Kingdom
Ukraine
NORTH AMERICA
Canada | United States | Mexico
CENTRAL AND SOUTH AMERICA
Argentina | Brazil | Costa Rica | Peru
AFRICA
Egypt | South Africa
AUSTRALIA
Australia | New Zealand
ASIA
China | Hong Kong | India
Indonesia | Israel | Japan
Malaysia | Philippines | Qatar
Russia | Saudi Arabia
Singapore | South Korea
Taiwan | Thailand | Turkey
United Arab Emirates | Vietnam
1 Includes PWM US, LatAm, EMEA, and Asia (as of 31 December 2012)2 As of 31 October 2012
• Over 350 Private Wealth Advisors in more than 40 regional offices
• Over $185Bn in assets under management1
• Focus on families with $20MM+ in investable assets
• Cover 20% of The Forbes 4002
• Generally co-located in the same offices as other Morgan Stanley businesses such as Investment Banking, Equities, Fixed Income and Investment Management, which provides strong linkage to other parts of the firm
MORGAN STANLEY PRIVATE WEALTH MANAGEMENT HIGHLIGHTS
• US PWM dedicated offices include: Atlanta, Boston, Chicago, Dallas, Houston, Los Angeles, Menlo Park, Miami, New York, Philadelphia, San Francisco, and Washington
Global Footprint — MS Today Has 60,000 Employees in 42 Countries
5
T H E M C G E E T E A M
ESTATE PLANNING
STRATEGISTS
WEALTH MANAGEMENT TEAM
CLIENT
ALTERNATIVEINVESTMENTS
LENDINGPHILANTHROPY
& FAMILYGOVERNANCE
INVESTMENTBANKING
INSURANCE
MIKE MCGEE
DirectorPrivate Wealth [email protected]
415.576-3186
• Comprehensive Wealth Strategies• Diversification and Asset Allocation Strategies• Hedging and Monetization Strategies
• Corporate Client Services
NICOLE JONES Wealth Management AssociateAssistant Vice [email protected]
415.576.8731
• Daily Team Operations• Financial Plan Generation• Client Reports and Correspondence
• Equity and Fixed Income Trading
MARCO SALERNO
Financial [email protected]
• Financial Planning Analyst• Wealth Transition Strategies• Portfolio Allocations
• Team Marketing
MARK HALEY
Portfolio [email protected]
• Daily Client Operations• Money Manager Selection and Due Diligence• Consulting Group Liaison
• Client Reports and Correspondence
6
W H Y W E A L T H Y F A M I L I E S C H O O S E O U R T E A M
We work with our clients to help
them first define and then
accomplish their goals by delivering
comprehensive, integrated
strategies that leverage the vast
resources and specialists of
Private Wealth Management and
the firm.
EXPERIENCE
• The team has been working with High Net Worth Families for over 18 years, through several market cycles.
• We are conservative in our approach to wealth management and highly focused on principal preservation first and foremost.
• We have extensive experience with families of newly acquired wealth and the process of diversification from single stock concentration.
• Customized, objective advice as the cornerstone of our client relationships.
PERSONALIZED SERVICE
• High touch service with quick and easy access to all of our team members.
• We are our client’s first point of contact for all their financial needs.
ABILITY TO DELIVER A GLOBAL PLATFORM
• We leverage Morgan Stanley’s senior professionals in the areas of capital markets, investments, lending, estate planning, insurance, philanthropy and investment banking where appropriate.
INDUSTRY RECOGNITION
• Mike has been recognized by several publications over the years. Details of each article can be found in his biography and reprints are available.
OUR TEAM’S PHILOSOPHY:
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O U R I N V E S T M E N T P H I L O S O P H Y
From our Discovery Process, we develop Strategic and Tactical asset allocations along with an implementation schedule to transition any existing portfolios and concentrated positions.
We spend a significant amount of time in the beginning of a relationship getting to know our clients. A comprehensive discovery process is crucial to the customized solutions we develop.
We incorporate both sides of the balance sheet in our analysis to give advice with respect to all assets and liabilities of the client and their family.
We utilize active and passive managers and investments, depending on the situation.
We develop separate asset allocations for the various entities of our clients to account for different tax situations, objectives and time horizons.
We leverage the intellectual capital and resources of the firm, but make our own decisions based on the unique situations of our clients.
We will consider, and have extensive experience with, alternative investments to help dampen portfolio volatility and provide risk adjusted return.
We are not trying to make our clients wealthy. We help to keep them wealthy and grow their assets in a conservative, tax efficient manner.
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O U R C L I E N T S
65%Corporate Executives
25%Entrepreneurs / Business Owners
10%Real Estate Professionals
5% $2-5 million
20% $5–10 million
55% $10–50 million
10% $50–100 million
10% $100+ million
RELATIONSHIPS BY CLIENT NATURE RELATIONSHIPS BY SIZE
9
C A S E S T U D I E S 1
CASE 1
• Upon arrival to the firm we coordinated a full day for the client and his spouse at firm headquarters in New York to showcase all the resources that were specific to the client’s needs and introduced the client to senior management of the firm.
• We are in constant contact with these clients and have just recently brought in our Estate Planning Specialist to discuss updating their estate plan, purchasing a significant insurance policy for estate preservation and we continue to implement an investment strategy to account for the client’s recent retirement and take advantage of tactical opportunities.
• We are the family’s primary Financial Advisor and have been working with the family for over 15 years.
Ongoing RelationshipThe StrategyThe Situation
• Client was a senior executive of a public corporation before retirement.
• He is worth several hundred million dollars, derived almost entirely from the restricted stock in his company.
• Client is married with two grown children.
1 The case study presented is provided for illustrative purposes only. Past performance is no guarantee of future results. The information has been obtained from sources we believe to be reliable, but we cannot guarantee its accuracy or completeness. These strategies do not guarantee a profit or protect against loss and may not be suitable for all investors. Each customer’s specific situation, goals, and results, may differ...
• We started working with the client before his IPO and advised the client on several estate planning strategies.
• After the IPO, we helped the client diversify his position significantly over several years with 144 sales and other various hedging and monetization strategies.
• On the investment side, we initially funded a Municipal Bond portfolio, established a discretionary trading account, allocated assets to several external money managers and participated in several alternative investment offerings, all within the context of an integrated, comprehensive wealth management plan.
• We have helped the family to relate their values to their children over many years and with the help of the firm’s Family Governance resources.
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C A S E S T U D I E S 1
CASE 2
• Throughout the execution of the diversification plan, the clients were very pleased with the professionalism and education they received from us and the firm.
• Since then, we have refinanced their mortgage, provided estate planning strategists to help rework their existing family trust, incorporated two insurance policies for estate preservation and set up two 529 educational plans for their children.
• We are the family’s only Financial Advisor. We are currently reworking their financial plan and asset allocation as the husband has just taken a job at another technology firm with significant stock and option positions, which we are incorporating into an updated plan for them.
Ongoing RelationshipThe StrategyThe Situation
• Client is an executive of a public corporation with a net worth of approximately $8.5 million.
• At the time we met him a large portion of his net worth was divided between his current and one previous employer’s stock, with very little diversification.
• He is 44 years old and married with two young children.
1 The case study presented is provided for illustrative purposes only. Past performance is no guarantee of future results. The information has been obtained from sources we believe to be reliable, but we cannot guarantee its accuracy or completeness. These strategies do not guarantee a profit or protect against loss and may not be suitable for all investors. Each customer’s specific situation, goals, and results, may differ...
• We first met with the clients at their home to fully understand their situation and goals. We explained our process and introduced them to our open architecture platform for asset allocation and investment management.
• We spent many meetings listening to their concerns and what they wanted to accomplish with their wealth. Once we had a very good picture of what they wanted to do we illustrated the concentration and risk of their current net worth. We then helped them develop a financial plan which included a diversification strategy for both stocks, as well as a coordinated asset allocation strategy to diversify their wealth through the use of multiple managers across multiple asset classes.
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A C U S T O M I Z E D A P P R O A C H 1
Your family’s dynamics, goals and risk tolerance are unique. We
will tailor our process to meet your personal and financial needs
and objectives.
Discovery processWhile every client situation is unique, we begin
by learning about you, your family and your
financial complexities. What we learn helps us to
formulate specific strategies and, of equal
importance, it helps us customize the entire
relationship to your preferences and
requirements.
1
Formulation of tax, trust and estate strategyAfter reviewing your balance sheet and existing
estate plan, we help analyze your income and
estate tax circumstances to identify planning
techniques that may be effectively tailored to your
personal and financial objectives. We will work
with your tax and legal advisors in this effort
2
Creation of a customized strategic asset allocationManaging significant wealth often involves developing
a customized asset allocation mix that reflects risk,
opportunities and taxation across multiple entities,
while integrating your investing and estate plans. This
asset allocation3,4 becomes the basis for a long-term
strategy formalized in your investment policy.
3
Integration of tactical asset allocationThese short-term adjustments in asset allocations
seek to take advantage of opportunities created by
temporary market distortions. Before adjustments
are made, we can analyze the impact of any taxes or
trading costs on potential returns.
4
Implementation of a customized investment strategyAfter comprehensive due diligence and extensive
analysis of expected results across a range of
market scenarios, investment strategies from our
global investment platform can be leveraged to
create your portfolio. This process can help to
create the most efficient balance of risk and
return for your specific strategy.
5
Ongoing assessment of wealth management needsCoordinating with you and your other advisors, we
can conduct ongoing reviews and comprehensive
reporting to ensure that your strategy adapts to
changing financial and family needs.
6
1 Asset allocation does not ensure a profit or protect against a loss
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A D I A L O G U E T O I D E N T I F Y Y O U R U N I Q U E F A M I L Y P O S I T I O N
S T E P 1 O F 6 : T H E D I S C OV E R Y P R O C E S S
Risk AppetiteLiquidity
Needs
Multi-Generational Family Goals
Taxability
Long Term GoalsSpecial
SituationsCharitable
GivingRestrictions
Time Horizon
AnticipatedWealth
Transfers
Short TermGoals
ConcentratedPositions
13
A C O L L A B O R A T I V E A P P R O A C H
S T E P 2 O F 6 : F O R M U L AT I O N O F TA X , T R U S T, A N D E S TAT E S T R AT E G Y
Customized Tax, Trust &
Estate Strategy
Tax, Trust & Estate Legacy
Planning Professionals
Your Current External Tax
Advisors
Your Current External Legal
Advisors
Your Morgan Stanley Private Wealth
Advisor
PROCESS FOR FORMULATING YOUR TAX, TRUST AND ESTATE STRATEGY
Conduct preliminary due diligence
(review of balance sheet and existing
estate planning)
Collaboratively discuss with the client
about income tax and estate planning
needs
Analyze available planning techniques
in relation to client’s financial goals
Assist clients and their tax and legal
advisors in the implementation of a
financially integrated estate plan to the
extent that the client is comfortable
Integrate investment and estate plans
(combining “asset location” with “asset
allocation”
1 Asset allocation does not ensure a profit or protect against a loss. 2 Morgan Stanley Wealth Management has created formal arrangements with third-party corporate trustees to provide fiduciary services for client personal trust accounts. Trustee services are available for a
wide variety of personal trusts. Talk to your Private Wealth Advisor for additional details.
5
4
3
2
1
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T H E P W M A S S E T A L L O C A T I O N F R A M E W O R K
S T E P 3 O F 6 : C R E AT I O N O F A C U S TO M I Z E D, S T R AT E G I C A S S E T A L LO C AT I O N
Analysis of Strategic Asset Allocation
• Employs quantitative analysis to identify the most appropriate customized solution for each client compared to various asset allocations
• Utilizes Monte Carlo Analysis, Factor Analysis and Time Period Analysis
Integrate Strategic Asset Allocation and Trust, Tax & Estate Planning
• Demonstrates how the integration of strategic asset allocation and appropriate estate planning can lead to a potentially more efficient transfer of wealth from an individual to charitable and/or noncharitablebeneficiaries
• Utilizes Monte Carlo Analysis
Starting with the Morgan Stanley Wealth Management Global Investment
Committee’s strategic frameworks, PWM utilizes rigorous analytical tools and models
to customize based on the complex needs of each family, endowment or foundation.
Asset allocation does not ensure a profit or protect against a loss
Formulated Tax, Trust &
Estate Strategy
Concentrated Stock Analysis Model
• Shows comparable performance and valuation metrics for a stock over the past 10 years
• Shows the risk/return tradeoff of transitioning into a diversified portfolio from a concentrated stock position
• Provides insight into potentially favorable liquidation and diversification strategies
Options Analysis Model
• Shows the valuation of ISOs and NQSOs for an individual stock and decomposes their total value into intrinsic value and time value
• Calculates the estimated tax cost of diversification as well as hurdle rates necessary for breakeven after exercising
Your Customized Strategic Asset Allocation and Investment Strategy
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S T E P 4 O F 6 : I N T E G R AT I O N O F TA C T I C A L A S S E T A L LO C AT I O N
L E V E R A G I N G M O R G A N S T A N L E Y W E A L T H M A N A G E M E N T
I N T E L L E C T U A L C A P I T A L
MORGAN STANLEY WEALTH MANAGEMENT GLOBAL INVESTMENT COMMITTEE
Morgan Stanley Private Wealth Management leverages the expertise of the Morgan Stanley Wealth Manage-ment Global Investment Committee for both strategic and tactical investment recommendations that are used as a basis from which to create customized recommendations that address clients’ unique risk profiles
The committee is composed of senior investment professionals from Morgan Stanley and its affiliates who have expertise in asset allocation, equity, fixed income, alternative investments, and currencies
To enhance long term performance potential while being mindful of adding volatility, the committee suggests tactical adjustments that may be made to take advantage of market opportunities
SAMPLE ASSET ALLOCATION FRAMEWORK
for Investors with $20MM+ Investable Assets (Model 4)
SAMPLE ASSET ALLOCATION FRAMEWORK STRATEGIC TACTICAL
GLOBAL CASH 5% 8%
GLOBAL FIXED INCOME 30% 30%
Investment Grade 22% 26%
Short Term Fixed Income 10% 15%
US Fixed Income 10% 9%
International Fixed Income 2% 2%
GLOBAL EQUITIES 32% 32%
U.S. Equity: Large Cap Growth 5% 5%
U.S. Equity: Large Cap Value 5% 3%
U.S. Equity: MidCap Growth 2% 2%
U.S. Equity: Mid Cap Value 2% 1%
U.S. Small Cap Growth 1% 1%
U.S. Small Cap Value 1% 1%
European Equity 9$ 9%
Japan Equity 4% 4%
Asia Pacific ex Japan Equity 2% 2%
Emerging Markets 10% 10%
ALTERNATIVE INVESTMENTS 25% 25%
REITs 3% 3%
Commodities Diversified 6% 6%
Ex Precious Metals 3% 2%
Precious Metals 3% 4%
Hedged Strategies 4% 4%
Managed Futures 2% 2%
Private Real Estate 5% 5%
Private Equity 5% 5%
TOTAL 100% 100%
SOURCE: GLOBAL INVESTMENT COMMITTEE AS OF 14 JANUARY 2013
Asset allocation does not ensure a profit or protect against a loss
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A C O M P R E H E N S I V E S U I T E O F S O L U T I O N S
S T E P 5 O F 6 : I M P L E M E N TAT I O N O F T H E C U S TO M I Z E D W E A LT H S T R AT E G Y
BALANCE SHEET & LIABILITY MANAGEMENT
CASH MANAGEMENT
FAMILY OFFICE SERVICES
1 Services may be provided by a third-party or through an affiliate of Morgan Stanley Smith Barney LLC
OPEN ARCHITECTURE INVESTMENT PLATFORM & ADVISORY SERVICES1
ADVISORY PLATFORMAsset-Based Fee
BROKERAGE PLATFORMTransaction-Based Fee
TRADITIONAL INVESTMENTS: Equity, Cash Alternatives, Fixed Income
Morgan Stanley Wealth Management Managers Separate Account
• Global Investment Solutions
• PWM Advisor Managed
• Morgan Stanley Investment Management
External Managers
Separate Account
• Managers Nationally recognized investment management firms
• Niche Strategies
ALTERNATIVE INVESTMENTS
Morgan Stanley/External Managers
• Hedge Funds
• Private Equity
Fund of Funds
• Managed Futures
EQUITY-RELATED
Research Calls
Underwriting Calendar
Derivatives
Strategic Equity
Portfolios
FIXED INCOME RELATED
Research Calls
Interest Rates
Credit Products
Municipals
Foreign Exchange
Commodities
ALTERNATIVES
• Private Equity
• Venture Capital
• Real Estate
• Real Assets
• Managed Futures
• Commodities
• Exchange Funds
• Fund of Funds
• Hedge Funds• Hedging Strategies and Risk Management Solutions
• Structured Products and Derivatives
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A C C E S S T O B A N K I N G & L E N D I N G S E R V I C E S
S T E P 5 O F 6 : I M P L E M E N TAT I O N O F T H E C U S TO M I Z E D W E A LT H S T R AT E G Y
Securities BasedLending
Tailored Lending3rd PartyLenders1
Morgan StanleyHome Loans
CashManagement
Purpose (Margin) and Non-Purpose
Products—Conforming, Jumbo, HELOCs
• Morgan Stanley Private Bank , National Association
• Collateral—Marketable
securities, Commercial Real Estate, Business Assets, Unsecured
• Commercial Banking and Lending (Citibank)
• Aviation (PNC)
• Yacht/RV (Essex)
• Art (Emigrant)
Access to Cash Management Services
Morgan Stanley Smith Barney LLC (“Morgan Stanley Wealth Management”) is a registered broker-dealer and member SIPC, not a bank. Where appropriate, Morgan Stanley Wealth Management has entered into arrangements with banks and other third parties to assist in offering certain banking related products and services. Banking and credit products and services are provided by Morgan Stanley Private Bank, National Association, Morgan Stanley Bank, N.A. or other affiliates. Morgan Stanley Private Bank, National Association and Morgan Stanley Bank, N.A. (collectively, the “Banks”) are FDIC members. Morgan Stanley Wealth Management and the Banks are affiliates. Unless specifically disclosed in writing, investments and services offered through Morgan Stanley Wealth Management are not insured by the FDIC, are not deposits or other obligations of, or guaranteed by, the Banks and involve investment risks, including possible loss of principal amount invested.
Morgan Stanley Home Loans are made by Morgan Stanley Private Bank, National Association or other affiliated lenders, not Morgan Stanley Wealth Management. The loans referenced herein are made by Morgan Stanley Private Bank, National Association. A Morgan Stanley Wealth Management investment relationship does not have to be established or maintained to obtain the products and services offered as part of the Home Loans program.
These products may not be available in all states and are limited to U.S. citizens and permanent resident aliens only. Residential loans are not available in Guam, Puerto Rico and the Virgin Islands. Other restrictions may apply. Morgan Stanley Private Bank, National Association underwriting guidelines will apply.
Loans are subject to credit application and loan approval. Rates, terms and programs are subject to change without notice.
Proceeds from mortgage loan transactions including initial draws and advances from HELOCs are not permitted to be used to purchase, trade or carry securities, repay margin debt or to make payments on any amounts owed under the Note or HELOC loan agreement.
Morgan Stanley Smith Barney LLC. 2000 Westchester Avenue, Purchase, NY 10577. Tel: 800-869-3326. Nationwide Mortgage Licensing System Unique Identifier No. 171760. Arizona Mortgage Broker License No. 0910887. California Department of Corporations Finance Lenders Law License No. 603H431. Georgia Residential Mortgage Licensee No. 23976. Kansas Licensed Mortgage Company No. MC.0025024. Massachusetts Mortgage Broker License No. MB5439. Montana Mortgage Broker License No. 171760. Licensed by the New Hampshire Banking
Department.23976. Kansas Licensed Mortgage Company No. MC.0025024. Massachusetts Mortgage Broker License No. MB5439. Montana Mortgage Broker License No. 171760. Licensed by the New Hampshire Banking Department. Licensed by the New Jersey Department of Banking and Insurance. Registered Mortgage Broker—NYS Banking Department. Ohio Mortgage Broker Act Certificate of Registration No. MB.804039.000. Rhode Island Licensed Loan Broker. Mortgage brokers may not make loans.
For additional important disclosures, please see the end of this presentation.
18
S T E P 6 O F 6 : O N G O I N G A S S E S S M E N T O F M A N A G E M E N T N E E D S
O N G O I N G A S S E S S M E N T T O H E L P M E E T Y O U R C H A N G I N G
F I N A N C I A L & F A M I L Y N E E D S
Asset allocation does not ensure a profit or protect against a loss
Review ofPortfolio
Performance
Executionand Tactical Adjustments
Review ofStrategic
Asset Allocation
Your strategic asset allocation is analyzed quantitatively and qualitatively in relation to your investment policy statement to confirm that your specific needs are being addressed
The appropriateness of each holding, based upon performance and your investment objectives, is assessed
Leverage the Firm’s intellectual capital and investment platform to integrate tactical changes to your asset allocation framework
Breadth ofExperienceto Adapt to
Changing ClientNeeds
19
P R E - I P O O R M & A
T R A N S A C T I O N T I M E L I N E
Post-IPO/M&A
Pre-IPO/M&A
Tax, Trust, Estate and Legacy Planning
Family Office Services
Investment & Risk Management
Tax and Estate Planning Strategy Session
Conduct a stock option analysis and consider exercise of options as appropriate
Appoint Morgan Stanley Smith Barney as custodian for private stock certificate
Evaluate stock hedging & sales(e.g. 10b5-1 plans)
Execute philanthropic gifting strategies
Implementation and monitor of 10b5-1 plan
Segregate tax liability from proceeds and invest
Implement investment portfolio with after-tax proceeds
Continue tax planning and integrate with investment plan
20
A P P E N D I X
21
O U R T E A M
Mike is a Director in the Private Wealth Management Group at Morgan Stanley, one of a select group of Financial Advisors designated to work with Ultra High Net Worth clients and their companies.
Mike was included in the “Top 100 California Advisors” in the February 9th, 2009 edition of Barron’s and in that same edition was named one of the “Top 1,000 Advisors” in the country. He made that same list for 2010 in the February 20th, 2010 edition of Barron’s, again for 2011 in the February 21st, 2011 edition, the February 20th, 2012 edition, the February 18th, 2013 edition and most recently in the February 24th, 2014 list for six years in a row. For 2014, the list is now the Barron’s 1,200.
Mike and his team joined the firm in July, 2002 from Robertson Stephens, where he worked for seven years. While at Robertson Stephens they worked primarily with the officers and key employees of companies before and after their organizations had a liquidity event or IPO.
Mike received a degree in Economics from Tufts University and studied Economics at Oxford University. He enjoys a wide variety of watersports and is actively involved with his wife’s non-profit organization.
MARCO SALERNOFinancial [email protected]
Marco has over eight years of financial service experience. His work for the team includes creating and delivering custom planning and investment solutions for ultra-high net worth families. As a fully licensed professional, Marco implements wealth management strategies for clients by concentrating on portfolio management. He focuses on global macro-economic research, asset allocation, portfolio hedging and estate planning strategies.
Marco is a Finance graduate of San Francisco State University and a five year honorable veteran of the U.S. Navy. Marco has a true appreciation for diverse cultures, having lived and worked in 23 countries around the world. He enjoys motorsports, fitness training and playing musical instruments. He serves as a member of several youth organizations, speaking to low-income teens to share his own story and encourage their personal success.
MIKE MCGEEDirectorPrivate Wealth [email protected]
415.576.3186
22
O U R T E A M
Nicole joined the firm in April, 2004. Her primary responsibility is the administration of the team. In addition, she works closely with the employees of our client companies and provides operational support to the clients. Nicole prepares our client reports and is our liaison to the Consulting Group.
Prior to joining the firm Nicole performed similar functions at Merrill Lynch and Robertson Stephens. She also has prior industry experience with Montgomery Securities.
Nicole graduated from Florida A & M University with a Bachelor of Science degree in Business Administration. Nicole is originally from Ohio and has been living and working in the Bay Area for nine years.
MARK HALEY
Portfolio [email protected]
Mark joined the firm in January, 2004. He has fifteen years of experience in the Securities Industry. He works closely with our clients and firm resources to provide full administrative and operational support for the team.
Prior to joining the firm, he worked as a Margin Analyst for Banc of America Securities, and in the Private Client Division with Bear Stearns.
He grew up in the Oakland and currently lives in San Francisco.
NICOLE JONESWealth Management AssociateAssistant Vice [email protected]
415.576.8731
23
D I S C L O S U R E S :
S E C U R I T Y T Y P E I N V E S T I N G R I S K S
PRIVATE EQUITYPrivate equity interests may be highly illiquid, involve a high degree of risk and be
subject to transfer restrictions.
MANAGED FUTURES
Managed futures investments are speculative, involve a high degree of risk, usesignificant leverage, are generally illiquid, have substantial charges, subject investors toconflicts of interest, and are suitable only for the risk capital portion of an investor’s
portfolio. Before investing in any partnership and in order to make an informeddecision, investors should read the applicable prospectus and/or offering documentscarefully for additional information, including charges, expenses and risks. Investors
should read the prospectus and/or offering documents carefully for additionalinformation, including charges, expenses and risks. Managed futures investments donot replace equities or bonds but rather may act as a complement in a well diversified
portfolio.
REAL ASSETS
The prices of real assets – precious metals tend to fluctuate widely and in aunpredictable manor, and have historically experienced periods of flat or decliningprices. Their prices are affected by several factors, including global supply and demand,
investors expectations with respect to the rate of inflation, currency exchange rates,interest rates, investment and trading activities of hedge funds and commodity funds,and global or regional political, economic or financial events and situations.
COMMODITIESInvesting in commodities entails significant risks. Commodity prices may be affected by
a variety of factors at any time, including but not limited to, (i) changes in supply anddemand relationships, (ii) governmental programs and policies, (iii) national andinternational political and economic events, war and terrorist events, (iv) changes in
interest and exchange rates, (v) trading activities in commodities and related contracts,(vi) pestilence, technological change and weather, and (vii) the price volatility of acommodity. In addition, the commodities markets are subject to temporary distortions
or other disruptions due to various factors, including lack of liquidity, participation ofspeculators and government intervention.
STRUCTURED PRODUCTSAn investment in Structured Investments involves risks. These risks can include, but arenot limited, to: fluctuations in the price, level or yield of underlying instruments,
interest rates, currency values and credit quality; substantial loss of principal; limits onparticipation in appreciation of underlying instrument; limited liquidity; credit risk ofthe issuer; and, conflicts of interest.
These materials are provided for general informational and educational purposes basedupon publically available information from sources believed to be reliable. These
materials do not take into account your personal circumstances and we do notrepresent that this material is complete or applicable to your situation. These materialsdo not constitute an offer to either buy or sell securities or to participate in any trading
strategy. These materials may change at any time without notice to you.
24
D I S C L O S U R E S
Tax laws are complex and subject to change. This information is based on currentfederal tax laws in effect at the time this was written. Morgan Stanley Smith BarneyLLC, its affiliates, employees and Private Wealth Advisors are not in the business of
providing tax or legal advice, and these materials and any statements contained hereinshould not be construed as tax or legal advice. This material was not intended or writtento be used, and it cannot be used by any taxpayer, for the purpose of avoiding penalties
that may be imposed on the taxpayer under U.S. federal tax laws. Individuals shouldconsult their personal tax advisor or attorney for matters involving taxation and taxplanning and their attorney for matters involving personal trusts and estate planning
and to understand the tax and related consequences of any actions or investmentsdescribed herein.
Morgan Stanley Smith Barney LLC is a registered Broker/Dealer, member SIPC, not abank. Where appropriate, Morgan Stanley Smith Barney LLC (Morgan Stanley WealthManagement) has entered into arrangements with banks and other third parties to
assist in offering certain banking related products and services. Unless specificallydisclosed in writing, investments and services offered through Morgan Stanley WealthManagement are not insured by the FDIC, are not deposits or other obligations of, or
guaranteed by, a bank and involve investment risks, including possible loss of principalamount invested. Except where specifically noted, banking and lending productsand services are provided by Morgan Stanley Private Bank, National Association,
Morgan Stanley Bank, N.A.
Investment and services offered through Morgan Stanley Private Wealth Management,
a division of Morgan Stanley Smith Barney LLC. Member SIPC.
Forex transactions have inherent risk, including the potential loss of principal, and are
not suitable for all investors. Forex transactions may be subject to exchange (orcurrency) risk or, the risk that an investor will have to close out a long or short positionin a foreign currency at a loss due to an adverse movement in exchange rate. Before
undertaking Forex transactions, you should understand the associated risks. Engagingin foreign currency transactions entails more varied risks than normally associated withtransactions in the domestic securities markets. Attention should be paid to market,
credit, sovereign and liquidity risks.
Cash or forward positions in foreign currencies are volatile and involve inherent risks
including the effect of leverage. The potential of loss is a significant consideration.Because of the effect of leverage, a relatively small market movement will have aproportionately large impact on the funds deposited. This loss can be equal to or, in
some instances, greater than the full amount of the initial investment.
Certain Forex transactions may only be entered into by clients who qualify as EligibleContract Participants (ECP) as defined by the Commodity Exchange Act. Over-the-counter transactions require investors to be classified as an Eligible Contract
Participant, and in certain instances transactions may be executed with a counterpartythat is an affiliate of Morgan Stanley Wealth Management.
The investments and services listed may not be suitable for all investors. MorganStanley Smith Barney LLC recommends that investors independently evaluateparticular investments, and encourages investors to seek the advice of a financial
advisor. The appropriateness of a particular investment will depend upon an investor’sindividual circumstances and objectives. Life Insurance, disability income insurance,and long-term care insurance are offered through Morgan Stanley’s licensed insurance
agency affiliates.
BARRON’S – TOP 100 CALIFORNIA ADVISORS
Source: Barron's “Top 100 California Advisors,” February 9, 2009, as identified byBarron's Magazine, using quantitative and qualitative criteria and selected from a totalannual pool of over 3,000 nominations. Advisors who are selected have a minimum of
seven years of financial services experience. Quantitative factors include, but are notlimited to, the amount of assets under management. Qualitative factors include, butare not limited to, compliance record, interviews with senior management, and
philanthropic work. Investment performance is not a criterion. The rating may not berepresentative of any one client's experience and is not indicative of the FinancialAdvisor's future performance. Neither Morgan Stanley Smith Barney nor its Financial
Advisors pay a fee to Barron's in exchange for the rating. Barron’s is a registeredtrademark of Dow Jones & Company, L.P. All rights reserved.
BARRON’S – TOP 1,200 AND 1,000 ADVISORSSource: Barron's “Top 1,200 Advisors,” February 24, 2014, as identified by Barron'smagazine, using quantitative and qualitative criteria and selected from a pool of over
4,000 nominations. Advisors in the Top 1,200 Financial Advisors have a minimum ofseven years of financial services experience. Qualitative factors include, but are notlimited to, compliance record and philanthropic work. Investment performance is not a
criterion. The rating may not be representative of any one client's experience and is notindicative of the financial advisor's future performance. Neither Morgan Stanley SmithBarney LLC nor its Financial Advisors or Private Wealth Advisors pays a fee to Barron's
in exchange for the rating. Barron’s is a registered trademark of Dow Jones & Company,L.P. All rights reserved.Asset Allocation and diversification does not guarantee a profit or protect against a
loss.
