May 12, 2017This articles discusses the rights of non-voting shareholders for entrepreneurs and investors. A common question that entrepreneurs/inventors have when incorporating is how to structure their business.
March 30, 2017The purpose of an Employee Stock Option Plan (ESOP) is to enable the corporation to grant stock options to its directors, officers, employees and consultants (the “participants”).
March 23, 2017Trust is a big part of any deal, and a situation where you’ve been hired and promised shares but never received any is a major breach of that trust. But does that trust translate into something legally binding, that when broken, gives you options for legal action?
October 27, 2016To avoid confusion, stipulate the date the agreement is to take effect into the agreement. It should also be indicated that this is the date that will be used to determine the price of the stock option.
October 27, 2016If a bank has an automatic exercise of options program, they may be able to evade the insider reporting requirements (section 91 of the Securities Act) in respect to the sale of common shares of the bank to employees.
October 27, 2016In the company's articles, explicitly provide which class of shares is to be issued under the Employee Stock Option Plan (ESOP). Also, ensure that redemption rules for all classes of shares are clearly stipulated.
October 27, 2016When issuing an ESOP, ensure that the proper consideration (money, property, or past services) is received and recorded. Even if the ESOP is issued on the basis of a loan provision, consideration must be received from the registered owner of the ESOP.
October 27, 2016Ensure employees have sufficient knowledge about a mandatory Employee Stock Option Plans (ESOP). If the ESOP becomes mandatory, ensure that employees are given sufficient notice and are well aware of this change.
February 13, 2016If there is a bona fide takeover bid from a third party, a majority of the shareholders can agree to the take-over on behalf of all shareholders due to the drag-along provisions.
February 12, 2016This article discusses the option of "paying with shares" which allows startups to offer their employees to purchase shares in the company in lieu of a raise.
January 31, 2016Stock options are often issued as a part of a company’s incentive program to the company’s and its subsidiaries’ key persons who are working on the company’s projects. The purpose of the stock options is to give personnel a financial incentive to work hard to increase the company’s shareholder value.
January 24, 2016The Board of Calico Resources set new corporate objectives and revised its executive compensation policy to align with those objectives.
January 17, 2016Drag-along provisions are clauses in a stock option plan or some other form of agreement which grant investors and shareholders the right to compel the founders and other stockholders to vote in favor of (or otherwise agree to) the sale, merger or other “deemed liquidation” of the company.
January 09, 2016SH Communications launched a new stock option plan to give their employees incentives to work harder and stay longer with the company. The assumption is that the employee option holder will want to do everything possible to increase the company’s shareholder value.
December 27, 2015Startup companies often struggle with the valuation calculation, and how to determine the number of shares to issue to a new team member.
December 14, 2015One of the best ways to increase stockholder value is to make each employee a stockholder, and get each employee to 'think like a stockholder'. This has motivated many companies to offer broad based employee stock option plans.
December 12, 2015According to a referenced article, from 2000 to 2012 productivity went up about 25%, but wages increased only about 7% in the United States. Fairly structured ESOP's may be a mechanism for promoting employee engagement and improved financial stability of the middle class..
November 29, 2015Even on company acquisitions, an ESOP can be used creatively to both share company profits with employees and provide assets for a retirement plan.
November 01, 2015The reverse stock split is intended to increase the per-share trading price, in order to satisfy the $1 minimum bid price requirement for continued listing on the NASDAQ Capital Market.
October 31, 2015The way ESOPs usually work in startup companies is by issuing the options with a vesting period, usually four years. Once the shares are vested an optionee may purchase and own the shares. However, Skype followed different conventions.
October 28, 2015FTI Consulting granted 'Employment Inducement Awards' to induce its new Chief Strategy and Transformation Officer to join the company. The Inducement Awards included a stock option grant that was 'outside of the shareholder approved program' but 'subject to the same terms and conditions'.
October 28, 2015With the market recovering and stabilizing in 2014, ESOP's became a tool for the retention and motivation of employees especially in the financial sector.