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Restricted Stock Agreement Template for Hong Kong

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Key Requirements PROMPT example:

Restricted Stock Agreement

"I need a Restricted Stock Agreement for granting 10,000 shares to our new Chief Technology Officer, with a 4-year vesting schedule starting March 1, 2025, and accelerated vesting provisions in case of a company sale."

Document background
The Restricted Stock Agreement serves as a crucial document in Hong Kong's corporate landscape for companies implementing equity-based compensation strategies. It is typically used when a company wishes to grant shares to employees or service providers subject to certain restrictions and vesting conditions. The agreement must comply with Hong Kong's Companies Ordinance, Securities and Futures Ordinance, and relevant tax regulations. It contains essential information about the stock grant, including the number of shares, vesting schedule, transfer restrictions, and rights during the restriction period. This document is particularly important for companies looking to align employee interests with company growth while maintaining compliance with Hong Kong's regulatory framework for share-based compensation.
Suggested Sections

1. Parties: Identifies the company issuing the restricted stock and the recipient

2. Background: Sets out the context of the agreement and the company's stock plan or scheme under which the grant is made

3. Definitions: Defines key terms used throughout the agreement including 'Restricted Stock', 'Vesting Date', 'Restriction Period'

4. Grant of Restricted Stock: Details the number of shares granted and acknowledgment of receipt

5. Vesting Schedule: Specifies the vesting timeline and conditions for the restricted stock

6. Transfer Restrictions: Outlines limitations on selling, transferring, or encumbering the shares during the restriction period

7. Rights as a Stockholder: Describes voting rights, dividend rights, and other shareholder privileges during the restriction period

8. Termination of Employment: Explains what happens to unvested shares upon various types of employment termination

9. Tax Matters: Addresses tax obligations, withholding requirements, and Section 83(b) election options

10. Compliance with Laws: Ensures compliance with applicable securities laws and company policies

11. Governing Law and Jurisdiction: Specifies Hong Kong law as governing law and jurisdiction for disputes

12. General Provisions: Standard contractual provisions including amendments, notices, and entire agreement clause

Optional Sections

1. Company Repurchase Rights: Optional section detailing the company's right to repurchase shares under certain conditions

2. Change in Control Provisions: Accelerated vesting or special provisions in case of company sale or merger

3. Lock-up Agreement: Additional restrictions during public offering periods, if applicable

4. Drag-Along Rights: Rights requiring the holder to join in sale of company shares in certain circumstances

5. Tag-Along Rights: Rights allowing the holder to join in sale of company shares in certain circumstances

6. Electronic Delivery: Consent to electronic delivery of documents and notices

7. Data Privacy Consent: Specific consent for processing personal data, particularly relevant for international grants

Suggested Schedules

1. Schedule 1 - Grant Notice: Detailed information about the specific grant including number of shares, grant date, and vesting schedule

2. Schedule 2 - Stock Plan Terms: Key terms of the company's stock plan under which the grant is made

3. Schedule 3 - Tax Election Forms: Required tax forms and elections including Section 83(b) election form

4. Schedule 4 - Stockholder Agreements: Any additional stockholder agreements that apply to the restricted shares

5. Appendix A - Jurisdiction-Specific Terms: Special terms required under Hong Kong law

6. Appendix B - Notice of Exercise: Form for exercising any related rights or elections

Authors

Alex Denne

Head of Growth (Open Source Law) @ tiktok³ÉÈ˰æ | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions



































Clauses



























Relevant Industries

Technology

Financial Services

Professional Services

Healthcare

Biotechnology

Manufacturing

Real Estate

Retail

E-commerce

Telecommunications

Media and Entertainment

Consulting

Energy

Relevant Teams

Legal

Human Resources

Finance

Executive Leadership

Corporate Secretarial

Compensation & Benefits

Compliance

Board of Directors

Share Registry

Relevant Roles

Chief Executive Officer

Chief Financial Officer

Chief Operating Officer

Chief Technology Officer

Chief Human Resources Officer

General Counsel

HR Director

Compensation Manager

Legal Counsel

Corporate Secretary

Finance Director

Equity Compensation Specialist

Stock Plan Administrator

Board Member

Executive Director

Senior Manager

Department Head

Key Employee

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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