Board Resolution For Grant Of Options Template for England and Wales

A Board Resolution For Grant Of Options is a formal corporate document that records your company's board decision to grant share options to eligible recipients. Under England and Wales law, this resolution forms part of your company's statutory records and provides crucial legal evidence of the board's authorization for option grants.

When do you need this document?

You need this resolution whenever your board decides to grant share options to employees, directors, or other eligible individuals. This typically occurs when implementing employee share schemes, rewarding key personnel, or establishing equity-based compensation packages. The resolution is particularly important for Enterprise Management Incentive (EMI) schemes, Company Share Option Plans (CSOPs), or unapproved option schemes. You'll also need this document when modifying existing option terms, accelerating vesting schedules, or making discretionary grants outside regular scheme cycles. Financial institutions and auditors often require this documentation during due diligence processes.

Key legal considerations

Your resolution must comply with your company's articles of association and any existing shareholder agreements that may restrict option grants. The document should specify the total number of shares under option, exercise price methodology, vesting conditions, and performance criteria where applicable. You must ensure the resolution demonstrates proper board authority and includes details of any regulatory notifications required. Consider the dilution impact on existing shareholders and whether pre-emption rights apply. The resolution should address tax implications, particularly for EMI qualifying conditions or CSOP requirements. Include provisions for option lapse scenarios, change of control situations, and employment termination events.

Legal requirements in England and Wales

Under the Companies Act 2006, your board resolution must be properly minuted and retained as part of your company's statutory records. You must ensure a valid quorum was present when passing the resolution and that proper notice was given to all directors. If granting EMI options, you must comply with Schedule 5 of the Income Tax Act 2003 and notify HMRC within 92 days. For companies with listed securities, you may need to comply with disclosure requirements under the Financial Services and Markets Act 2000. Your resolution should confirm compliance with employment law under the Employment Rights Act 1996, particularly regarding equal treatment and discrimination provisions. Consider whether the Financial Conduct Authority's rules on financial promotions apply if communicating option grants to recipients.