Create a stock option scheme

About this business activity

An employee can create a stock option scheme to receive company stock as compensation, which can provide an incentive to stay with the company and help attract and retain talented employees.

Non-tax advantaged share options agreement (for contractors, advisors, etc)

  • This template is for a certain type of share options available in the UK known as "unapproved" or "non-tax advantaged" options.
  • Unapproved options do not require HMRC approval or require the workers to work more than 75% of their time with the business, meaning they are typically used for non-employees such as contractors, advisors, NEDs, international employees and so on.
  • They are not as tax advantaged as the EMI option scheme under the UK government rules.

Key issues covered in this template

  • Cliff period and vesting period of share options
  • What happens if the option holder ceases to be a service provider
  • Data protection
  • Non-relation with a separate contract for services
  • Non-transferability of option
  • Manner of exercise of option
  • Tax indemnity
  • Exit events

‍

What to watch out for

  • A contract for services (such as an advisor agreement) is not included
  • The Cliff Period and Vesting Period can be easily stated in the document
  • Various ways to terminate the agreement should be assessed by both parties, such as if the option holder ceases to be a service provider
  • The company should not be held liable for any taxes incurred by the option holder. This is taken care of in the contract

‍

Contract template sketch
1
7
1

Emi Share Option For Time And Performance (Stand-Alone)

This is a legal document that grants an employee the option to buy shares in the company based on how long they have worked there and how well they have performed.

What to watch out for

  • The agreement should grant the employee a time
  • based share option.
  • The agreement should be performance
  • based.
  • The company should be able to terminate the agreement at any time.
  • The employee should be able to terminate the agreement if the company fails to meet the performance criteria.
  • Contract template sketch
    4
    11
    2

    Exit Only Emi Share Option (Stand-Alone)

    This is a legal document that grants an employee an "exit only" stock option from their company.

    What to watch out for

  • The agreement should be in writing
  • The agreement should be signed by both parties
  • The agreement should state the number of shares to be granted
  • The agreement should state the exercise price of the shares
  • The agreement should state the expiration date of the option
  • Contract template sketch
    4
    11
    0

    Schedule 4 Rules For A Company Share Option Plan (Csop)

    The following is a template for a company share option plan (CSOP) that meets the requirements of Schedule 4 of the Income Tax (Earnings and Pensions) Act 2003.

    What to watch out for

  • The rules of the CSOP
  • The requirements of Schedule 4 of the Income Tax (Earnings and Pensions) Act 2003.
  • Contract template sketch
    4
    12
    3

    Time and Performance Based Employee Share Option Grant (Non Tax-Advantaged)

    This is a legal document that grants a non tax-advantaged share option to an employee, based on time and performance.

    What to watch out for

  • The agreement should be in writing
  • The agreement should be signed by both parties
  • The agreement should specify the number of shares to be granted
  • The agreement should specify the exercise price of the option
  • The agreement should specify the vesting schedule of the option
  • The agreement should specify the expiration date of the option
  • Contract template sketch
    2
    4
    2

    Time and Performance Based Option Certificate (Non Tax-Advantaged)

    This document is for a non tax-advantaged share option plan, either time-based or performance-based.

    What to watch out for

  • The options granted should not be tax
  • advantaged
  • The options should be either time
  • based or performance
  • based
  • Contract template sketch
    2
    1
    1

    Time and Performance Based Employee Share Options Grant (Board Minutes)

    This document is a record of a meeting held by the board of directors in which they established a share option plan and granted employee share options. The minutes can be used for EMI, CSOP and non tax-advantaged share options. Simultaneous tax-advantaged and non tax-advantaged option grants are often necessary because of the statutory limits on individual holdings of tax-advantaged options. If at least some option holders will exceed the relevant limit, then non tax-advantaged options will need to be granted to them in addition to their tax-advantaged options.

    What to watch out for

  • The board minutes recording the establishment of, and grant of employee share options under, a time and performance share option plan.
  • The minutes can be used for EMI, CSOP and non tax
  • advantaged share options.
  • Simultaneous tax
  • advantaged and non tax
  • advantaged option grants are often necessary because of the statutory limits on individual holdings of tax
  • advantaged options.
  • If at least some option holders will exceed the relevant limit, then non tax
  • advantaged options will need to be granted to them in addition to their tax
  • advantaged options.
  • Contract template sketch
    2
    1
    0

    Time and Performance Based Share Option Scheme Rules (Non Tax-Advantaged)

    This document outlines the rules for a private company's non tax-advantaged share option plan, which grants options that can be exercised after meeting time-based or performance-based conditions.

    What to watch out for

  • The rules of the plan
  • The conditions under which the options may be exercised
  • The terms of the options themselves
  • Contract template sketch
    1
    1
    0

    Employer's Guide to Time and Performance Based Share Option Plan (Non Tax-Advantaged)

    A guide for employers on how to establish and operate a non tax-advantaged share option plan that is based on time and performance.

    What to watch out for

  • The establishment and operation of a non tax
  • advantaged time and performance share option plan.
  • Contract template sketch
    3
    1
    2

    Employee Guide to Time and Performance Based Share Option Plan (Non Tax-Advantaged)

    This guide explains share options to employees who are part of a non tax-advantaged time and performance share option plan.

    What to watch out for

  • The document should explain share options to employees in a clear and concise manner
  • It should be easy to read and understand
  • It should be up to date with the latest information on share options
  • It should be accurate and free from errors
  • It should be unbiased and objective
  • Contract template sketch
    0
    3
    0

    Company Share Option Plan Certificate

    This document is a certificate for a CSOP (employee stock ownership plan) option.

    What to watch out for

  • The document should include the name of the company and the employee.
  • The document should state the number of shares the employee is entitled to.
  • The document should specify the exercise price of the option.
  • The document should set out the expiry date of the option.
  • Contract template sketch
    3
    6
    1

    Phantom Share Option Certificate (Private Company)

    This is a form of phantom share option certificate for a private company's phantom share option plan.

    What to watch out for

  • The document should include the name of the company and the plan, as well as the names of the participants.
  • It should also include the number of shares covered by the plan and the exercise price.
  • The expiration date of the options should also be included.
  • Contract template sketch
    1
    3
    0

    Time And Performance Option Grant Rules For EMI Share Option Plan

    This document provides template rules for the grant of options that qualify as enterprise management incentives (EMI) share options under Schedule 5 of the Income Tax (Earnings and Pensions) Act 2003, as well as for the grant of non tax-advantaged options.

    What to watch out for

  • The document should outline the rules for granting options that qualify as enterprise management incentives (EMI) share options.
  • The rules should also provide for the grant of non tax
  • advantaged options.
  • Contract template sketch
    2
    2
    2

    AIM Company Rules For EMI Option Plan

    This document provides template rules for the grant of options by an AIM company that wishes to comply with the Investment Association (IA) principles of remuneration. Options that qualify as enterprise management incentives (EMI) share options under Schedule 5 of the Income Tax (Earnings and Pensions) Act 2003, as well as non tax-advantaged options, can be granted under the plan.

    What to watch out for

  • The rules for granting options
  • The types of options that can be granted
  • The investment association principles of remuneration
  • The requirements for enterprise management incentives (EMI) share options
  • Contract template sketch
    3
    5
    1

    Paragraphs Covering Grant Of EMI Option Grant For AIM Company Board Minutes

    The EMI share option plan (AIM) allows for the granting of tax-advantaged EMI or CSOP or non tax-advantaged share options. The following paragraphs are for board minutes to record the adoption of plan rules and the grant of options.

    What to watch out for

  • The adoption of plan rules
  • The grant of tax
  • advantaged EMI or CSOP or non tax
  • advantaged share options
  • Contract template sketch
    0
    6
    2

    Employee EMI Exercise Notice

    This is a form for employees to fill out and sign when they wish to exercise their EMI stock options.

    What to watch out for

  • The form of notice for the exercise of an EMI option
  • Completion and signature by the employee
  • Contract template sketch
    2
    2
    1

    Employer's Guide To Time And Performance Based EMI Option Plan

    This document is a guide for employers on how to establish and operate an enterprise management incentives (EMI) option plan that is based on time and/or performance conditions.

    What to watch out for

  • The establishment and operation of an enterprise management incentives (EMI) option plan subject to time and/or performance based exercise conditions.
  • The key tax and National Insurance contributions (NICs) advantages and disadvantages of EMI
  • The conditions that must be met for the grant of EMI options
  • The types of company that can grant EMI options
  • The maximum value of options that can be granted to any one employee
  • The employees who can be granted EMI options
  • The process for granting EMI options
  • The tax and NICs consequences of exercising EMI options
  • The tax and NICs consequences of selling shares acquired on exercise of EMI options
  • The reporting requirements for EMI option plans
  • Contract template sketch
    3
    6
    2

    Options Grant Under EMI Time And/Or Performance Based Vesting Plan

    This is an agreement for a share option plan that allows employees to purchase shares at a set price, either after a certain amount of time has passed or after meeting certain performance goals.

    What to watch out for

  • The time and/or performance based exercise condition of the EMI share option plan
  • The option agreement itself
  • Contract template sketch
    2
    6
    2

    Employees Guide To Time And Performance Based EMI Option Plan

    This document is a guide for employees who participate in an EMI share option plan that is based on time and performance.

    What to watch out for

  • The document should be used as a guide for employees who have an EMI share option plan based on time and performance.
  • The document outlines what the employee should do in order to participate in the plan and how the plan works.
  • The document also includes information on how the employee can exercise their options and what the tax implications are.
  • Contract template sketch
    0
    5
    2

    Non-Qualifying Options Grant Under EMI Time And/Or Performance Based Vesting Plan

    This is a legal document outlining the conditions under which non-qualifying options may be granted to employees under an Employee Share Option Plan. The options may be exercised based on time and/or performance conditions.

    What to watch out for

  • The document should outline the conditions under which the options can be exercised
  • It should specify whether the options are subject to a vesting period
  • It should detail the performance criteria that must be met in order for the options to be exercised
  • Contract template sketch
    3
    5
    0

    EMI Rollover Agreement For Acquired Company

    This is a rollover agreement for an EMI share option plan that can be used when the company being acquired offers to grant a replacement EMI option under the statutory EMI option rollover provisions.

    What to watch out for

  • The document should specify the terms of the rollover agreement, including the number of shares to be granted and the exercise price.
  • It should also set out the conditions under which the rollover agreement may be terminated, and the consequences of such termination.
  • Finally, the document should explain the tax implications of the rollover agreement.
  • Contract template sketch
    3
    6
    1

    Employee EMI Option Plan

    This is an EMI option agreement to be used with the EMI share option plan (exit only) rules.

    What to watch out for

  • The agreement should be used in conjunction with the EMI share option plan (exit only) rules
  • The agreement sets out the terms and conditions of the option
  • The agreement should be signed by the employee and the company
  • The agreement should be dated
  • The agreement should state the number of shares the employee is entitled to purchase
  • The agreement should state the exercise price of the option
  • The agreement should state the expiration date of the option
  • The agreement should state the vesting schedule of the option
  • The agreement should state the restrictions on the transfer of the option
  • Contract template sketch
    1
    6
    1

    Employers EMI Exit-Only Option Plan Guide

    This document is a guide for employers on how to set up and run an enterprise management incentives (EMI) option plan.

    What to watch out for

  • The establishment of an EMI option plan
  • The operation of an EMI option plan
  • The exit of an EMI option plan
  • Contract template sketch
    1
    1
    1

    Performance Based EMI Option Agreement For AIM Listed Company (Not Tax-Advantaged)

    This is a non-tax-advantaged performance-based option agreement to be used by an AIM company to grant options under an enterprise management incentives (EMI) option plan.

    What to watch out for

  • The document should be reviewed by a qualified tax advisor to ensure that the options granted are not tax
  • advantaged.
  • The company should ensure that the options are granted under an enterprise management incentives (EMI) option plan that is approved by HMRC.
  • The company should ensure that the options are granted to employees who meet the eligibility criteria for EMI options.
  • The company should ensure that the options are granted for a period of not more than 10 years.
  • The company should ensure that the options are exercised at a fair market value.
  • Contract template sketch
    2
    4
    0

    Performance Based EMI Option Agreement For AIM Listed Company

    This document is an agreement for AIM companies to grant enterprise management incentives (EMI) options under an EMI option plan, based on performance.

    What to watch out for

  • The document should be used by AIM companies to grant performance
  • based EMI options under an EMI option plan.
  • The agreement should include the number of options to be granted, the exercise price of the options, the vesting schedule, and the expiry date of the options.
  • The agreement should also include a description of the performance criteria that must be met in order for the options to vest.
  • Contract template sketch
    3
    3
    1

    Share Option Agreement (Exit-Only EMI Plan)

    This is a non-qualifying (non tax-advantaged) share option agreement to be used with exit only EMI share option plan rules.

    What to watch out for

  • The document should specify who the options are being granted to.
  • The document should specify the number of options being granted.
  • The document should specify the exercise price of the options.
  • The document should specify the expiration date of the options.
  • Contract template sketch
    1
    5
    0

    Employee Guide To Exit Only EMI Share Option Plan

    This document is a guide for employees of EMI who have been granted options under an exit only EMI share option plan. It explains what these options are and how to use them.

    What to watch out for

  • This is a guide for employees that is intended to be used for EMI and non
  • qualifying options granted under an exit only EMI share option plan.
  • The guide covers the following topics:
  • The types of options that can be granted under an exit only EMI share option plan.
  • The key features of an exit only EMI share option plan.
  • The tax implications of an exit only EMI share option plan.
  • The process for exercising options under an exit only EMI share option plan.
  • The consequences of not exercising options under an exit only EMI share option plan.
  • Contract template sketch
    0
    1
    1

    Relevant Contract Types

    πŸ“ˆ EMI Options Agreement

    An EMI option is an agreement between an employer and employee that gives the employee the right to purchase shares in the company at a set price, usually at a discount to the market price. The agreement will specify the number of shares that can be purchased, the price at which they can be bought, and the period of time during which the option can be exercised.

    Thank you!

    What happens now?
    Check your email inbox now! Most people receive an invite link from us instantly, so you are only a click away from full access πŸ’₯
    Didn’t receive an email?
    If you don’t have an invite link sat in your inbox (and youβ€˜ve refreshed that page a couple of times), then you fall into the group of of people I like to personally welcome in to the Genie Community πŸ‘‹.

    Please book in 30 minutes with me using this link
    https://calendly.com/rafie/30-min-call

    If you don’t want to book a call in now, no problem. I’ll be in touch over the next few days
    Small Avatar - Rafie Faruq 150 x 150 pixels
    Rafie Faruq
    Chief Executive Officer
    Oops! Something went wrong while submitting the form.

    Legal firms who may be able to help

    Find legal help for

    Create a stock option scheme

    . If we don't have a template for you to use yet, we will refer you to legal help instead.

    Note: Although we list lawyers who may be able to help, this does not indicate that the listed law firms have an affiliation or partnership with Genie AI.

    Match Solicitors

    Match Solicitors

    Employment law firm

    0121 647 6788

    Employment

    Hallett Employment Law Services

    Hallett Employment Law Services

    Employment law firm

    01455 208886

    Employment

    rradar

    rradar

    Employment law firm

    0330 041 4996

    Employment

    Featured templates

    Advisor Agreement (Payment Via Share Options)

    Use this agreement when bringing an advisor on board to formalize variables such as job role and responsibilities, duration of contract and compensation. The agreement also sets forth certain key terms such as confidentiality and intellectual property.

    Read More
    Contract template sketch
    12
    145
    6

    Consultancy Agreement - Company appointing an individual consultant (not using a personal service company)

    This template is to be used the next time your company needs to set out terms with an individual (i.e. not to be used for agreements involving a personal service company as defined within IR35). It sets out the terms on which a contractor provides services to a client company, and is perfect for freelance software developers, marketing consultants, designers, PR/HR/recruitment consultants.

    Read More
    Contract template sketch
    9
    118
    12

    Intellectual Property Assignment (for founders to assign IP to company)

    This IP Agreement is designed for an individual to assign IP to a company e.g. a founder is starting a company and needs to vest the IP into that company

    ‍

    Read More
    Contract template sketch
    4
    25
    1

    Do you need a lawyer?

    We have 150+ legal templates for businesses like yours to use for FREE

    find out more

    Browse by:

    Business categories

    Business activities

    SEEΒ ALL
    SEEΒ LESS

    Contract types

    SEEΒ ALL
    SEEΒ LESS