Equity Incentive Agreement Template for Singapore

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Key Requirements PROMPT example:

Equity Incentive Agreement

"I need an Equity Incentive Agreement for my Singapore-based fintech startup to grant stock options to our senior engineers, with a 4-year vesting schedule starting March 2025 and special provisions for accelerated vesting in case of company acquisition."

Document background
The Equity Incentive Agreement is a crucial document in Singapore's corporate landscape, used when companies wish to offer equity-based compensation to attract, retain, and motivate key personnel. It provides a comprehensive framework for granting and managing equity incentives while ensuring compliance with Singapore's regulatory requirements. The agreement typically includes detailed provisions on grant terms, vesting conditions, exercise procedures, and restrictions on transfer, making it essential for companies implementing employee stock option plans or other equity-based compensation schemes. This document is particularly relevant in today's competitive talent market where equity compensation has become a standard component of total remuneration packages.
Suggested Sections

1. Parties: Identification of the company and the option recipient

2. Background: Context of the equity incentive scheme and its purpose

3. Definitions: Key terms used throughout the agreement

4. Grant of Options: Details of the options being granted, including number and class of shares

5. Exercise Price: Price at which options can be exercised

6. Vesting Schedule: Timeline and conditions for option vesting

7. Exercise Period: Timeframe during which options can be exercised

8. Termination Provisions: Consequences of employment termination on options

Optional Sections

1. Change of Control Provisions: Treatment of options in case of company sale/merger - used for companies considering potential exit scenarios

2. Lock-up Period: Restrictions on selling shares after exercise - used when company wants to ensure long-term holding

3. Clawback Provisions: Company's right to recover shares/options - used when misconduct or performance issues are concerns

Suggested Schedules

1. Option Certificate: Formal document evidencing the grant of options

2. Vesting Schedule: Detailed breakdown of vesting dates and conditions

3. Exercise Notice: Template form for exercising options

4. Shareholders Agreement: Key terms affecting option holders post-exercise

5. Tax Treatment Summary: Overview of tax implications for option holder

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
Industries

Companies Act (Cap. 50): Primary legislation governing corporate structures, share issuance, requirements for share transfers and allotments, registration of share options and share plans, and directors' duties and shareholder rights

Securities and Futures Act (Cap. 289): Regulates securities offerings, disclosure requirements, prospectus requirements and exemptions, and defines securities and regulated activities

Income Tax Act (Cap. 134): Governs tax treatment of share options and awards, Employee Share Option Scheme (ESOS) requirements, and tax implications for both company and employees

Employment Act (Cap. 91): Covers employment relationship implications, rights and obligations of employers/employees, and compensation and benefits considerations

MAS Guidelines: Monetary Authority of Singapore guidelines covering compliance requirements for listed companies, corporate governance requirements, and disclosure obligations

SGX Listing Rules: Singapore Exchange requirements for share option schemes, shareholder approval requirements, and disclosure obligations for listed companies

Personal Data Protection Act 2012: Legislation governing handling of personal data, consent requirements, and data protection obligations

Contract Law: Basic principles of contract formation, consideration requirements, terms and conditions, and enforceability under Singapore law

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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