Preparing employee stock option agreements is a complex and lengthy process.
This is why we decided to share our own and open source it for the entrepreneurial community. We have worked on it at length to consider financial, tax, and legal implications and make an unbiased and fair contract that will reward the employee, protect the company, and set fair financial remuneration for the work and passion that is required in building a startup.
The template includes:
1. The list of defitions applied in the contract: our best effort to translate financial calculations into legal words
2. A default one year cliff and monthly vesting afterwards: terms that can be adjusted but are the norm for early stage startups as of today
3. The vesting schedule in appendix: a useful, more financial, appendix that clarifies a lot of the calculations expressed in the legal gergon
4. All the common terms that are required in a stock option contract
5. Overview of how the option is affected in all possible employment termination scenarios
The template does NOT include:
– tax treatment
– compliance
These sections are omitted because of their vast difference according to region and legislation.
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The document serves just as a starting point for business owners and employees. It is not a legal document and should not be used without consulting a legal adviser on the country-specific terms and procedures.
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