Advisory Shares Agreement for Canada

Advisory Shares Agreement Template for Canada

A Canadian legal document that establishes the terms and conditions under which a company grants shares to an advisor in exchange for their advisory services. The agreement complies with Canadian federal and provincial securities laws, detailing the share grant, vesting schedule, advisor's duties, and protective provisions for the company. It includes specific provisions required under Canadian corporate law and securities regulations, including necessary exemptions under National Instrument 45-106 and provincial Securities Acts. The document addresses tax implications, confidentiality obligations, and intellectual property rights in accordance with Canadian legislation.

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What is a Advisory Shares Agreement?

The Advisory Shares Agreement is a critical document used when companies wish to compensate advisors with equity instead of or in addition to cash compensation. This agreement is particularly relevant for Canadian startups and growth companies seeking to attract experienced advisors while preserving cash resources. The document must comply with Canadian securities laws, including federal and provincial regulations, and typically includes detailed provisions about share grants, vesting schedules, advisor duties, and protective covenants. The Advisory Shares Agreement should be carefully drafted to address securities law compliance, tax implications, and corporate governance requirements specific to Canadian jurisdictions. It's commonly used when engaging industry experts, seasoned entrepreneurs, or subject matter specialists who can provide valuable guidance to the company's development and growth.

What sections should be included in a Advisory Shares Agreement?

1. Parties: Identification of the Company and the Advisor, including full legal names and addresses

2. Background: Context of the advisory relationship and purpose of the agreement

3. Definitions: Key terms used throughout the agreement, including 'Advisory Shares', 'Vesting Period', 'Services', etc.

4. Appointment and Services: Scope of advisory services to be provided and terms of appointment

5. Share Grant: Details of the advisory shares being granted, including number of shares, class, and any restrictions

6. Vesting Terms: Vesting schedule, conditions, and acceleration provisions if applicable

7. Advisor's Obligations: Specific duties, time commitment, and performance expectations

8. Representations and Warranties: Standard representations from both parties, including advisor's sophistication and company's authority to issue shares

9. Confidentiality: Protection of company confidential information

10. Intellectual Property: Ownership and assignment of IP created during the advisory relationship

11. Term and Termination: Duration of the agreement and grounds for termination

12. General Provisions: Standard boilerplate including governing law, notices, amendments, etc.

What sections are optional to include in a Advisory Shares Agreement?

1. Non-Competition: Restrictions on advisor's involvement with competing businesses - include if advisor has access to sensitive competitive information

2. Non-Solicitation: Restrictions on soliciting company employees or customers - include if advisor has significant contact with key stakeholders

3. Tax Matters: Specific tax handling and responsibilities - include if complex tax implications exist or if advisor is non-resident

4. Board Observer Rights: Rights to attend board meetings - include if advisor is senior executive or industry expert

5. Expense Reimbursement: Terms for reimbursing advisor expenses - include if travel or other expenses are expected

6. Insurance and Indemnification: Coverage of advisor under company insurance - include if advisor role carries significant liability risk

What schedules should be included in a Advisory Shares Agreement?

1. Schedule A - Services Description: Detailed outline of advisory services to be provided

2. Schedule B - Share Vesting Schedule: Detailed vesting timeline and milestones

3. Schedule C - Share Rights and Restrictions: Detailed terms of the share class being issued

4. Appendix 1 - Accredited Investor Certificate: Certification of advisor's accredited investor status if required

5. Appendix 2 - IP Assignment Agreement: Detailed IP assignment terms and procedures

6. Appendix 3 - Share Transfer Restriction Agreement: Detailed share transfer restrictions and procedures

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Jurisdiction

Canada

Publisher

Genie AI

Document Type

Advisor Agreement

Cost

Free to use
Relevant legal definitions
Clauses
Relevant Industries

Technology

Biotechnology

Financial Services

Clean Energy

Healthcare

Manufacturing

Professional Services

E-commerce

Software Development

Consulting

Media and Entertainment

Real Estate

Education Technology

Artificial Intelligence

Relevant Teams

Legal

Human Resources

Finance

Corporate Governance

Executive Leadership

Board of Directors

Compensation

Corporate Development

Relevant Roles

CEO

Chief Legal Officer

Corporate Secretary

General Counsel

Board Member

Chief Financial Officer

VP of Human Resources

Legal Counsel

HR Director

Compensation Manager

Corporate Governance Manager

Equity Compensation Specialist

Industry Advisor

Technical Advisor

Strategic Advisor

Executive Advisor

Industries
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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