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Restricted Stock Agreement
"I need a Restricted Stock Agreement under Indian law for granting 10,000 shares to our new Chief Technology Officer, with a 4-year vesting schedule starting March 1, 2025, and including special provisions for accelerated vesting in case of a company sale."
1. Parties: Identification of the Company and the Recipient/Grantee of the restricted stock
2. Background: Context of the agreement, including reference to any equity incentive plan and board approvals
3. Definitions: Key terms including Restricted Stock, Vesting Date, Vesting Schedule, Restriction Period, etc.
4. Grant of Restricted Stock: Details of the stock grant including number of shares, class of shares, and nominal value
5. Vesting Requirements: Vesting schedule, conditions, and requirements for the restrictions to lapse
6. Transfer Restrictions: Limitations on transfer, sale, or encumbrance of shares during the restriction period
7. Rights During Restriction Period: Voting rights, dividend rights, and other shareholder privileges during the restriction period
8. Termination of Employment: Consequences of employment termination on restricted stock
9. Tax Obligations: Tax responsibilities of both parties and procedures for tax withholding
10. Compliance with Laws: Obligations to comply with Indian securities laws, SEBI regulations, and other applicable laws
11. Representations and Warranties: Standard declarations by both parties regarding capacity, authority, and compliance
12. General Provisions: Standard clauses including notices, amendments, governing law, and dispute resolution
1. Foreign Investment Compliance: Required when the recipient is a non-resident Indian or foreign national, addressing FEMA compliance
2. Electronic Records and Communications: Optional section for companies maintaining electronic records of restricted stock
3. Drag-Along Rights: Optional provisions for forced sale in case of company sale or merger
4. Tag-Along Rights: Optional rights for the recipient to participate in sale of shares by major shareholders
5. Lock-in Period: Additional restrictions beyond vesting period, often used for key employees
6. Accelerated Vesting: Optional provisions for acceleration of vesting in specific circumstances like change in control
7. Shareholders Agreement Compliance: Required if the company has an existing shareholders agreement affecting restricted stock
1. Schedule 1 - Details of Restricted Stock Grant: Specific details of shares granted including number, class, and nominal value
2. Schedule 2 - Vesting Schedule: Detailed timeline and conditions for vesting of restricted stock
3. Schedule 3 - Shareholders' Rights: Detailed description of rights attached to the shares
4. Schedule 4 - Tax Computation Guidelines: Guidelines for calculating tax implications at various stages
5. Appendix A - Board Resolution: Copy of board resolution approving the restricted stock grant
6. Appendix B - Equity Incentive Plan: Reference to or extract of the company's equity incentive plan
7. Appendix C - Regulatory Compliance Checklist: Checklist of compliance requirements under Indian law
Authors
Technology
Financial Services
Professional Services
Manufacturing
E-commerce
Healthcare
Telecommunications
Consulting
Software Development
Biotechnology
Retail
Real Estate
Education Technology
Legal
Human Resources
Finance
Corporate Secretarial
Executive Leadership
Compensation & Benefits
Corporate Governance
Compliance
Chief Executive Officer
Chief Financial Officer
Chief Technology Officer
Chief Operating Officer
Senior Vice President
Vice President
Director
Senior Manager
Department Head
Principal Engineer
Senior Software Engineer
Key Account Manager
Product Manager
Research Scientist
Senior Consultant
Executive Director
General Counsel
Head of Human Resources
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