Here is the legal paperwork you need to compensate key employees
with stock options — saving your cash for growth!
Give your best people participation in the upside...
The best way to motivate valuable employees is to give them a piece of ownership in your company through stock options. They will feel the ownership, and enjoy the reward of staying the course and helping you to build your business.
StockOptionsBuilder is a collection of sample documents written in Word that you can easily edit or export to your favorite word-processor. It also includes several Excel spreadsheet tools — just fill in the variables and print.
Here's how your stock options work:
Options are simply the right to purchase your stock in the future at a price you determine now. (If you gave your employees the stock now, they would have to pay income tax on the value of the shares.) Instead, you give them the opportunity to purchase stock in the future at set a "strike price."
This way, they can enjoy the increase in value that their contribution will bring. They don’t have to pay for the stock until the time is right when the shares can be simultaneously sold.
Stock options are great for rewarding employees, contractors and other contributors to your business for their continued support, contributions and long-term commitment.
The typical start-up looking for venture financing will reserve 10-20% of the "outstanding shares" for the employee option pool. As the number of outstanding shares increases, the option pool will be increased from time to time to stay in the above range. The option plan is usually set up when the company needs to grant options, usually when the first employees are hired.
Here's what you get—a complete suite of documents and spreadsheets are enclosed to complete and manage the process:
• Cover Letter to Employees
Dear employee... Here is the paperwork that says, “You get a piece of the action…” Read this, sign that, file everything for the future (now get back to work!) It's actually a formal letter explaining the contents of the packet (most of this product) that you are giving them.
• Stock Option Agreement
This makes the incentive real in the minds of your employees and partners. All the benefits of owning shares (except voting rights) without the tax liability—pay for the shares and the taxes when the value has been built. Usually when your company is acquired or goes public, a simultaneous transaction is created whereby you and your employees purchase the options and immediately receive the proceeds.
• Stock Option Plan
Describes all of the legal details of a properly executed incentive stock option plan. What you and they can and cannot do, vesting, what to expect, dates, contingencies, disclaimers, etc.
Vesting
(Vesting gives shareholders the right to purchase an increasing percentage of their shares as time goes by… For example, using a 5 year vesting schedule, a person would be eligible to purchase 20% of their shares at the end of the first year. This way, if an employee or partner quits (or you must fire them), they can have only a prorated fraction of their original allotted number of shares based upon the amount of time the actually worked for you. Forfeited shares go back into the option pool.)
• Summary of Terms of the Stock Option Plan
This handy information sheet further explains many of the details involved in an Incentive Stock Option Plan.
• Common Stock Purchase Agreement
When it’s time to actually purchase the stock, you have the paperwork to complete the process.
• Stock Options Planning & Tracking Worksheet
Use this spreadsheet to list all of your shareholders as well as option holders. Keep track of when you gave the options, the option price, vesting—automatically calculates the balance of shares available for other employees and contributors.
• Board of Directors’ Approval
The formalities are serious. This makes it official. We make sure that you do it right. Fill in who gets how much stock, have your Board of Directors sign it, and you have officially approved granting stock options to your people. Use this handy form over and over again whenever you want to issue more options.
Your Own Stock Option Program...
Everything You Need—Easy to Edit & Complete
Just edit the pre-written text and print. Spreadsheets are already formatted in native Excel template with automatic formulas built in. Enter the names, dates and amounts and print.
You can put the whole thing in place yourself for a fraction (a very small fraction) of the cost of having it written from scratch. Then have your attorney (please see a specialist) or our affiliated law firm review it for completeness. Stock Options for your employees—a piece of the action... "golden handcuffs"... managed your way.
No new software to learn — Just load and go
There are no tricky computer programs or applications to learn. As soon as you download these Excel templates you can get started right away...
Put the necessary structure into your business that you need to increase profits, improve efficiency, and enable you to grow.
System Requirements
- Windows 95/98/2000/ME/XP
- Office 2000 or newer
- IBM-compatible PCs with a Pentium® processor or better, 166MHz or faster
- 32MB RAM, 64MB or more recommended
- 24MB hard disk space
- CD-ROM drive, 4x or faster
- Mouse or compatible pointing device
- 24-bit/true-color display
- Compatible with most popular printers
Please be sure you have all of the latest Windows and Office Service Packs installed... this makes world of difference!
- Click your START button (on your desktop)
- Click "Windows Updates" (or visit www.microsoft.com -- look for 'downloads') -- Please follow the Microsoft instructions.
Also, you may need to disable Norton before installing BizPlanBuilder.
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