Restricted Stock Award Agreement Template for Switzerland

A Swiss law-governed agreement that documents the grant of restricted company shares to an employee as part of their compensation package. The agreement outlines the terms and conditions of the share award, including vesting requirements, transfer restrictions, and forfeiture provisions. It ensures compliance with Swiss securities laws, tax regulations, and employment law requirements while establishing the rights and obligations of both the company and the employee regarding the awarded shares. The document includes specific provisions for Swiss tax treatment and social security implications of the award.

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What is a Restricted Stock Award Agreement?

The Restricted Stock Award Agreement is utilized when a Swiss company wishes to grant shares to employees as part of their compensation package, subject to certain restrictions and vesting conditions. This document is essential for implementing equity-based compensation programs in Switzerland, ensuring compliance with Swiss corporate law, securities regulations, and tax requirements. It typically forms part of a broader equity incentive plan and includes detailed provisions on vesting schedules, transfer restrictions, taxation implications, and termination scenarios. The agreement is particularly important in the Swiss context due to specific regulatory requirements regarding employee compensation, securities law compliance, and tax treatment of equity awards. It serves as a key document for both privately held and publicly traded companies in Switzerland looking to align employee interests with company performance through equity ownership.

What sections should be included in a Restricted Stock Award Agreement?

1. Parties: Identification of the company granting the award and the employee receiving it

2. Background: Context of the award, reference to any equity incentive plan, and corporate authorizations

3. Definitions: Key terms used throughout the agreement including 'Restricted Stock', 'Vesting Date', 'Restriction Period', etc.

4. Grant of Restricted Stock: Details of the stock award including number of shares, grant date, and nominal value

5. Vesting Requirements: Vesting schedule, conditions, and requirements for the restrictions to lapse

6. Transfer Restrictions: Limitations on sale, transfer, or encumbrance of shares during the restriction period

7. Termination of Employment: Treatment of awards upon various types of employment termination

8. Rights as a Shareholder: Voting rights, dividend rights, and other shareholder privileges during the restriction period

9. Tax Obligations: Tax implications, withholding requirements, and social security contributions

10. Compliance with Laws: Requirements for compliance with Swiss securities laws and other applicable regulations

11. Data Privacy: Consent for processing personal data related to the award administration

12. General Provisions: Standard contractual provisions including governing law, notices, and amendments

What sections are optional to include in a Restricted Stock Award Agreement?

1. Malus and Clawback: Provisions allowing the company to recoup or cancel awards in cases of misconduct or financial restatement

2. Change in Control: Treatment of awards in case of corporate transactions or change in control

3. Non-Competition and Non-Solicitation: Restrictions on competitive activities and employee solicitation, if applicable

4. International Provisions: Additional terms for cross-border awards or non-Swiss residents

5. Plan Administration: Details about the administration of the award program, if not covered in a separate equity plan

6. Electronic Acceptance: Provisions for electronic grant acceptance and administration, if applicable

What schedules should be included in a Restricted Stock Award Agreement?

1. Vesting Schedule: Detailed breakdown of vesting dates and portions

2. Tax Summary: Overview of tax implications and filing requirements in Switzerland

3. Notice of Grant: Formal notice specifying individual grant details including number of shares and dates

4. Form of Share Certificate: Template for restricted share certificates or book entry confirmation

5. Administrative Procedures: Procedures for handling dividends, voting rights, and communications

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

Jurisdiction

Switzerland

Publisher

Genie AI

Cost

Free to use

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