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Restricted Share Agreement Template for Germany

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Key Requirements PROMPT example:

Restricted Share Agreement

"I need a Restricted Share Agreement under German law for granting 10,000 shares to our new Chief Technology Officer, with a 4-year vesting period starting March 1, 2025, and including special provisions for a potential IPO within the next 2 years."

Document background
The Restricted Share Agreement is a fundamental document used in German corporate practice for implementing equity-based compensation programs. It is typically employed when companies wish to grant shares to employees, executives, or consultants while maintaining certain restrictions on ownership and transfer. The document must comply with German corporate law, particularly the Stock Corporation Act (Aktiengesetz) and relevant securities regulations. This agreement is essential for startups, established companies, and multinational corporations operating in Germany who want to align stakeholder interests with company performance through share ownership. The document includes detailed provisions on vesting schedules, transfer restrictions, tax implications, and corporate governance requirements specific to the German jurisdiction, including necessary works council consultations where applicable.
Suggested Sections

1. Parties: Identification of the company issuing shares and the recipient

2. Background: Context of the agreement and relationship between parties

3. Definitions: Key terms used throughout the agreement, including specific German legal terminology

4. Grant of Restricted Shares: Details of the share grant, including number of shares, class, and nominal value

5. Vesting Schedule: Timeline and conditions for the vesting of restricted shares

6. Transfer Restrictions: Limitations on transfer of shares during the restriction period

7. Company's Right of Repurchase: Terms under which the company can repurchase unvested shares

8. Tax Provisions: German tax implications and responsibilities of both parties

9. Representations and Warranties: Statements of fact by both parties regarding their capacity and authority

10. Compliance with Laws: Obligations to comply with German corporate and securities laws

11. Termination: Circumstances and consequences of agreement termination

12. General Provisions: Standard clauses including governing law, jurisdiction, and notices

Optional Sections

1. Employment Relationship: Required when recipient is an employee, addressing relationship with employment contract

2. Works Council Approval: Required when German works council consultation is necessary

3. Share Voting Rights: Optional section defining voting rights during restriction period

4. Dividend Rights: Optional section specifying treatment of dividends during vesting period

5. Bad Leaver Provisions: Optional section defining consequences of termination for cause

6. Change of Control: Optional provisions for corporate restructuring scenarios

7. Lock-up Period: Additional transfer restrictions beyond vesting period

Suggested Schedules

1. Schedule 1 - Share Details: Detailed information about the restricted shares being granted

2. Schedule 2 - Vesting Schedule: Detailed timeline and conditions for share vesting

3. Schedule 3 - Shareholders' Agreement: Reference to or extract of relevant shareholders' agreement provisions

4. Schedule 4 - Tax Election Forms: Required German tax forms and elections

5. Schedule 5 - Share Transfer Form: Template for future share transfers

6. Appendix A - Acceptance Form: Recipient's formal acceptance of the restricted shares

7. Appendix B - Share Certificate: Form of share certificate or confirmation of electronic registration

Authors

Alex Denne

Head of Growth (Open Source Law) @ ¶¶Òõ¶ÌÊÓÆµ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions












































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Relevant Industries

Technology

Financial Services

Manufacturing

Professional Services

Healthcare

Biotechnology

Software

Consulting

E-commerce

Telecommunications

Media and Entertainment

Real Estate

Energy

Retail

Relevant Teams

Legal

Human Resources

Finance

Corporate Secretariat

Executive Leadership

Compensation and Benefits

Compliance

Tax

Corporate Governance

Share Administration

Relevant Roles

Chief Executive Officer

Chief Financial Officer

Human Resources Director

Legal Counsel

Corporate Secretary

Compensation Manager

Employee Benefits Manager

Finance Director

Managing Director

Board Member

Senior Executive

Department Head

Key Employee

Staff Member

Consultant

Independent Contractor

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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