| Employee/director share subscription deed This standard document is an application for a subscription for shares by an employee or director, including a tax and NICs indemnity and an exclusion of liability for losses arising from loss of office or employment, and is in the form of a deed.For a short form letter application to subscribe for shares, which might be appropriate at an early stage of development of a company where there are few tax concerns about the employee's or director's shares, see Standard document, Subscription letter. |
| Plug-in clause: exclusion of claims for breach of contract relating to board exercise of discretion A plug-in clause for share option and share award plan rules which excludes the employee's right to bring a claim for breach of contract as a result of an exercise of discretion by the board of directors. |
| Share sale and purchase: Warranties relating to employee share plans and other incentives This document sets out specimen warranties about employee shares and share incentives (and other incentives) which could be included in an agreement for the sale and purchase of the entire share capital of a private company. |
| Data protection rule for share plans A plug-in rule for an employee share plan, dealing with employees' data protection rights. |
| Joint ownership arrangement: Letter to trustee of EBT to recommend that EBT enter into joint ownership agreement A precedent for a letter to the trustee of an employee benefit trust (EBT) recommending that the trustee of the EBT enter into agreements to acquire shares jointly with employees under a joint ownership arrangement. |
| Joint ownership arrangement: agreement for employee and trustee to jointly acquire shares A precedent for a joint ownership agreement under which the trustee of an employee benefit trust and an employee acquire different interests in a number of shares. These arrangements may also be referred to as joint share ownership plans (JSOP), shared ownership plans or jointly owned equity arrangements. |
| Letter to be sent to option holders on a rights issue A precedent for a letter to be sent to option holders when the company with shares under option has made a discounted rights issue. |
| Letter to be sent to LTIP award holders on a rights issue A standard letter from a company to the holder of an LTIP award, explaining how a rights issue affects outstanding LTIP awards. |
| Subscription letter A short form letter of application to subscribe for shares. The subscription letter confirms the number of shares subscribed for, and the amount paid per share. It also authorises the company to add the subscriber's name to the company's register of members. It refers to the consideration for the shares to be by way of cheque, banker's draft, electronic transfer or release of a debt owed by the company to the subscriber. This letter has been drafted to satisfy sections 583(2) and 583(3)(a) to (c) of the Companies Act 2006 (meaning of payment in cash). For a short form letter of application where the consideration is by way of an undertaking to pay cash to the company at a future date, see Standard document, Subscription letter: undertaking to pay. For a long form subscription deed to use when an employee or director subscribes for shares, including a tax indemnity and exclusion clause relating to liabilies for loss on termination, see Standard document, Employee/director subscription deed. Note that, in a non-leveraged investment round, the investors' subscription and payment for shares will be made pursuant to an investment agreement (see Standard document, Investment agreement: non-leveraged investment). |
| Board minute paragraphs for a grant of options over new issue shares under both a tax-advantaged and an unapproved option plan This document sets out component paragraphs for board minutes recording the simultaneous grant of employee share options over new issue shares under tax-advantaged and fully taxable (unapproved) share option plans. Simultaneous tax-advantaged and unapproved option grants are often necessary because of the statutory limits on individual holdings of tax-advantaged options. If at least some option holders will exceed the relevant limit, then unapproved options will need to be granted to them in addition to their tax-advantaged options. The tax-advantaged option plan could be either an EMI share option plan or an HMRC-approved company share option plan (CSOP). |
| Subscription letter: undertaking to pay A short form letter of application to subscribe for shares including an undertaking by the subscriber to pay the subscription monies for the shares at a future date. For a short form subscription letter where the subscription monies will be paid in full on issue, see Standard document, Subscription letter. |
| Stand-alone unapproved option (grant by shareholder to employee) A standard document for the grant of an unapproved share option by a shareholder to an employee by way of a stand-alone agreement, rather than under an employee share option plan whose rules specify in detail many of the terms of each option. However, it could be used with a simple employee share option plan, in which the rules prescribe option terms by reference to this document as a standard form of option agreement. |
| Articles of association: non-leveraged investments: companies formed on or after 1 October 2009 A sample set of articles of association to be used for companies incorporated on or after 1 October 2009 which are backed by a non-leveraged venture capital equity investment. These articles are originally based on the BVCA model articles of association for early stage investments. |
| Agreement for the surrender of an unapproved option for cash (payment by buyer) This document can be used for the surrender of an option where there is cash consideration. |
| Remuneration Committee briefing paper on adjustments to share options and awards needed on a rights issue A remuneration committee paper setting out proposals for adjusting entitlements under employee share plans as a result of a rights issue. |
| PAYE and employee NICs Indemnity A stand-alone PAYE indemnity from an employee (or former employee) or consultant for PAYE tax and NICs that the employer cannot deduct or has not deducted from payments. NOTE: This resource is being reviewed in light of the 2013 Budget. For more information, see Legal update, 2013 Budget: key business tax announcements. |
| Unapproved share option plan rules This standard document sets out template rules for the grant of options without any statutory tax advantages. This type of option is generally called an "unapproved option". These template rules are very comprehensive - users may find that draft rules they derive from them are considerably shorter. The optional rule 10 in this document allows for cash settlement of an option, where the option holder consents to this. Settling an option in this way would produce the same result as payment under a "phantom share option" or (in US terminology) a cash-settled "share appreciation right". Rule 10 also allows for settlement to be by way of a reduced number of shares, without any payment of the exercise price, which is the same as a share-settled "share appreciation right". Finance Act 2011 contains anti-avoidance legislation, enacted as Part 7A of the Income Tax (Earnings and Pensions) Act 2003, which taxes disguised remuneration provided to employees through third parties such as employee benefit trusts (EBTs), including, potentially, benefits provided under employee share plans. The legislation contains certain exemptions for employee share options, but the provisions are complicated and restrictive. Companies and their advisers should consider the impact of Part 7A when considering adopting a new share option plan which will operate in conjunction with an EBT. For more information, see Practice note, Disguised remuneration: Part 7A of the Income Tax (Earning |
| Unapproved share option plan: notice of exercise of option This is a form of exercise notice for use with PLC's precedent unapproved share option plan rules. |
| Unapproved share option plan: option certificate This is a form of option certificate for use with PLC's precedent unapproved share option plan rules. If downloading this document in word, susbcribers may prefer to alter the format to landscape and reduce the font size of some provisions to create a document in a "certificate" format. |
| Stand-alone unapproved option (grant by company to employee) A standard document for the grant of an unapproved share option by a company to an employee by way of a stand-alone agreement, rather than under an employee share option plan whose rules specify in detail many of the terms of each option. However, it could be used with a simple employee share option plan, in which the rules prescribe option terms by reference to a version of this document as a standard form of option agreement. |
| Third party rights exclusion rule for an employee share or share option plan A precedent for a rule to exlude third party rights in awards made under an employee share or share option plan. |