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Phantom Stock Award Agreement
"I need a Phantom Stock Award Agreement for our Series B startup in India, granting 1000 phantom stock units to our new CTO with 4-year vesting starting March 2025, including special provisions for accelerated vesting in case of acquisition."
1. Parties: Identification of the Company and the Employee receiving the phantom stock award
2. Background: Context of the phantom stock award program and its purpose
3. Definitions: Definitions of key terms including Phantom Stock Units, Fair Market Value, Vesting Period, Performance Criteria, and other relevant terms
4. Grant of Phantom Stock Units: Details of the number of units granted and basic terms of the grant
5. Vesting Schedule: Specific timeline and conditions for vesting of the phantom stock units
6. Valuation Mechanism: Method and formula for calculating the value of phantom stock units
7. Payment Terms: Conditions and process for payment of vested phantom stock units
8. Taxation and Compliance: Tax implications and responsibilities of both parties
9. Termination Provisions: Impact of various types of employment termination on phantom stock rights
10. Confidentiality: Obligations regarding non-disclosure of agreement terms and company information
11. Governing Law and Jurisdiction: Specification of Indian law as governing law and jurisdiction for disputes
12. General Provisions: Standard legal provisions including amendments, notices, and entire agreement clause
1. Non-Competition and Non-Solicitation: Additional restrictions on employee activities, recommended for senior employees
2. International Tax Provisions: Required if the employee is an expatriate or if there are cross-border tax implications
3. Change of Control Provisions: Specific provisions dealing with company ownership changes, recommended for private companies
4. Performance Criteria: Detailed performance conditions for vesting, needed if vesting is performance-based rather than time-based
5. Clawback Provisions: Provisions for recovering payments in case of fraud or misconduct, recommended for senior positions
6. Administrative Procedures: Detailed procedures for managing the phantom stock program, recommended for larger programs
1. Schedule 1 - Grant Notice: Specific details of the phantom stock grant including number of units and grant date
2. Schedule 2 - Vesting Schedule: Detailed timeline of vesting dates and quantities
3. Schedule 3 - Valuation Methodology: Detailed formula and process for calculating phantom stock value
4. Appendix A - Tax Treatment Summary: Summary of tax implications and withholding requirements
5. Appendix B - Administrative Forms: Standard forms for exercising rights, making claims, and other administrative actions
6. Appendix C - Performance Criteria: Detailed metrics and targets if vesting is performance-based
Authors
Technology
Financial Services
Professional Services
Manufacturing
Healthcare
Retail
E-commerce
Telecommunications
Consulting
Real Estate
Private Equity
Venture Capital
Human Resources
Legal
Finance
Compensation & Benefits
Corporate Secretarial
Executive Leadership
Board Secretariat
Compliance
Corporate Strategy
Chief Executive Officer
Chief Financial Officer
Senior Vice President
Vice President
Director
Senior Manager
Department Head
Technical Lead
Senior Engineer
Principal Consultant
Key Account Manager
Senior Sales Executive
Regional Manager
Product Manager
Research Lead
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