������Ƶ

A Stock Option Agreement gives employees the right to buy company shares at a set price within a specific timeframe. In New Zealand, these agreements form a key part of many employee compensation packages, especially in startups and growing businesses looking to attract and retain top talent.

The agreement spells out crucial details like the strike price (what you'll pay per share), vesting schedule (when you can exercise your options), and any rules around selling the shares. Under NZ securities law, companies must carefully structure these agreements to comply with Financial Markets Conduct Act requirements and ensure proper disclosure to option holders.

Use a Stock Option Agreement when your company needs to incentivize key employees without spending immediate cash. This tool works especially well for New Zealand startups and growth-phase businesses looking to attract talented staff while preserving capital for business operations.

The agreement becomes vital during funding rounds, when establishing employee share schemes, or as part of executive compensation packages. It's particularly useful when competing for skilled professionals against larger firms offering higher salaries. Under NZ law, implementing these agreements early helps avoid costly securities compliance issues and ensures clear documentation of share ownership rights.

• Traditional Share Options: Standard agreements granting employees the right to buy company shares at a fixed price, usually vesting over 3-4 years
• Performance-Based Options: Tied to specific company or individual targets, common in NZ tech firms and startups
• Executive Stock Options: More complex agreements with additional rights and restrictions, often part of senior management packages
• Growth Shares: Special class options that only gain value once the company reaches certain valuation thresholds
• Employee Share Purchase Plans: Structured options allowing regular share purchases at discounted rates, popular among larger NZ companies

• Companies/Employers: Create and offer Stock Option Agreements as part of compensation packages, usually through their board of directors
• Employees/Recipients: Accept and exercise options according to vesting schedules and agreement terms
• Legal Counsel: Draft and review agreements to ensure compliance with NZ securities laws and Financial Markets Conduct Act
• HR Managers: Administer option schemes and maintain records of grants, vesting dates, and exercises
• Company Directors: Approve option grants and oversee the share option scheme's implementation

• Company Details: Gather current share price, total shares authorized, and share class information
• Option Terms: Determine exercise price, vesting schedule, and expiry dates for the options
• Recipient Information: Collect employee details, position, and eligibility under NZ securities laws
• Board Approval: Secure necessary corporate authorizations and shareholder consents
• Documentation: Our platform generates compliant agreements with all required terms and conditions
• Review Points: Check share scheme rules, tax implications, and Financial Markets Authority requirements

• Grant Details: Number of options, exercise price, and grant date clearly stated
• Vesting Schedule: Detailed timeline of when options become exercisable
• Exercise Terms: Process and conditions for converting options into shares
• Termination Provisions: What happens to options if employment ends
• Securities Law Compliance: Required disclosures under NZ Financial Markets Conduct Act
• Tax Implications: Acknowledgment of tax obligations for both parties
• Shareholder Rights: Voting and dividend entitlements once options are exercised

Stock Option Agreements often get confused with Stock Purchase Agreement, but they serve distinctly different purposes in New Zealand's corporate landscape. While both deal with company shares, their timing, structure, and legal implications differ significantly.

• Timing of Transfer: Stock Option Agreements grant future rights to purchase shares at a set price, while Purchase Agreements facilitate immediate share transfers
• Price Mechanism: Options lock in today's price for future purchases, whereas Purchase Agreements reflect current market value
• Vesting Requirements: Option Agreements typically include vesting schedules and performance conditions; Purchase Agreements enable direct, immediate ownership
• Tax Treatment: Options trigger tax implications upon exercise, while Purchase Agreements may have immediate tax consequences under NZ law
• Target Users: Options typically serve as employee incentives, while Purchase Agreements suit investors and business sales