Restricted Stock Agreement Template for Australia

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Key Requirements PROMPT example:

Restricted Stock Agreement

"I need an Australian Restricted Stock Agreement for our tech startup to grant 10,000 shares to our new CTO, with quarterly vesting over 4 years starting March 2025, and including special provisions for an IPO event."

Document background
The Restricted Stock Agreement is a crucial document used in Australian corporate practice when companies wish to grant shares to employees or contractors subject to certain restrictions and vesting conditions. This agreement is commonly utilized as part of employee compensation packages, particularly for key personnel retention and long-term incentivization. It must comply with Australian corporate law, including the Corporations Act 2001 (Cth), relevant tax legislation, and ASX requirements for listed companies. The document typically includes detailed provisions about share grant terms, vesting schedules, transfer restrictions, forfeiture conditions, and tax implications. It's particularly relevant in the context of employee share schemes and equity compensation plans, requiring careful consideration of both corporate and tax implications under Australian law.
Suggested Sections

1. Parties: Identification of the Company and the Recipient of the restricted stock

2. Background: Context of the agreement, including reference to any employee share scheme or compensation plan

3. Definitions: Definitions of key terms used throughout the agreement

4. Grant of Restricted Stock: Details of the stock grant, including number of shares, grant date, and any consideration

5. Vesting Provisions: Vesting schedule, conditions, and requirements for the restricted stock

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

7. Forfeiture Conditions: Circumstances under which shares may be forfeited

8. Tax Provisions: Tax obligations and responsibilities of both parties

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

10. Termination Provisions: Impact of employment termination on restricted stock

11. Compliance with Laws: Requirements for compliance with relevant Australian laws and regulations

12. General Provisions: Standard contractual terms including notices, amendments, governing law, and dispute resolution

Optional Sections

1. Change in Control Provisions: Provisions addressing the impact of company ownership changes on vesting and restrictions

2. International Tax Provisions: Additional tax considerations for non-Australian residents or international tax implications

3. Drag-Along Rights: Rights requiring the recipient to sell shares in case of a company sale

4. Tag-Along Rights: Rights allowing the recipient to participate in a sale of shares by major shareholders

5. Employee Share Trust Provisions: Provisions relating to any trust structure used to hold the shares

6. Non-Competition and Non-Solicitation: Restrictive covenants tied to the stock grant

7. Relationship with Employment Agreement: Clarification of how this agreement interacts with existing employment terms

Suggested Schedules

1. Schedule 1 - Share Details: Detailed information about the restricted shares including class, rights, and total number

2. Schedule 2 - Vesting Schedule: Detailed timetable and conditions for vesting of shares

3. Schedule 3 - Shareholder Agreement Terms: Key terms from the company's shareholder agreement that apply to these shares

4. Schedule 4 - Tax Election Forms: Required tax forms and elections under Australian tax law

5. Schedule 5 - Notice of Grant: Formal notice of stock grant including all relevant details

6. Appendix A - Acceptance Form: Form for the recipient to formally accept the grant and its terms

7. Appendix B - Company Constitution Excerpts: Relevant excerpts from the company constitution affecting these shares

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 | Serial Founder & Legal AI Author

Relevant legal definitions
Clauses
Relevant Industries

Technology

Financial Services

Professional Services

Healthcare

Mining and Resources

Manufacturing

Retail

Telecommunications

Biotechnology

Real Estate

Education

Media and Entertainment

Relevant Teams

Legal

Human Resources

Finance

Executive Leadership

Corporate Governance

Tax

Compensation and Benefits

Share Registry

Company Secretariat

Compliance

Relevant Roles

Chief Executive Officer

Chief Financial Officer

Chief Operating Officer

General Counsel

Human Resources Director

Company Secretary

Financial Controller

Compensation Manager

Legal Counsel

HR Manager

Equity Compensation Specialist

Stock Plan Administrator

Corporate Lawyer

Tax Manager

Senior Executive

Department Head

Key Employee

Industries
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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