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Vested Equity Agreement
"I need a Vested Equity Agreement for our Saudi-based technology startup to grant 5% equity to our new CTO, with monthly vesting over 4 years starting January 2025, including a one-year cliff and acceleration provisions in case of company acquisition."
1. Parties: Identification of the Company, the Equity Recipient, and any other relevant parties
2. Background: Context of the agreement, including company information and purpose of the equity grant
3. Definitions: Key terms used throughout the agreement, including technical and legal definitions
4. Grant of Equity: Details of the equity being granted, including type, class, and nominal value of shares
5. Vesting Schedule: Specific timeline and conditions for equity vesting, including milestones and dates
6. Vesting Conditions: Performance metrics, continued employment requirements, or other conditions that must be met
7. Rights and Restrictions: Voting rights, dividend rights, and transfer restrictions associated with the equity
8. Termination Provisions: Consequences of employment termination or service discontinuation on vesting
9. Company's Rights and Obligations: Company's commitments, including maintaining necessary authorizations and compliance
10. Recipient's Rights and Obligations: Recipient's commitments, including confidentiality and non-competition obligations
11. Tax Matters: Treatment of tax and Zakat obligations related to the equity grant and vesting
12. Governing Law and Jurisdiction: Confirmation of Saudi law application and dispute resolution mechanisms
13. General Provisions: Standard clauses including amendments, notices, and entire agreement provisions
1. Shareholder Rights: Additional section for cases where the equity grant includes specific shareholder rights or obligations
2. Board Representation: Required when the equity grant includes rights to board representation or observer status
3. Lock-up Period: Additional restrictions on share transfers for a specified period post-vesting
4. Tag-Along Rights: Include when minority shareholder protections are necessary
5. Drag-Along Rights: Include when majority shareholder rights need to be protected
6. Islamic Finance Compliance: Detailed section on Sharia compliance when required by parties or circumstances
7. Employee Benefits: Additional benefits or rights tied to the equity grant for employee recipients
8. Intellectual Property Rights: Required for recipients involved in technical or creative roles
1. Schedule 1 - Vesting Schedule Details: Detailed breakdown of vesting dates, percentages, and milestones
2. Schedule 2 - Share Certificate: Form of share certificate or evidence of ownership
3. Schedule 3 - Company Information: Details of company structure, capitalization, and existing shareholders
4. Schedule 4 - Shareholders' Agreement Terms: Key terms from the existing shareholders' agreement affecting the grant
5. Schedule 5 - Performance Metrics: Detailed criteria for performance-based vesting conditions
6. Schedule 6 - Required Notices and Forms: Templates for necessary notifications and regulatory filings
7. Appendix A - Board and Shareholder Resolutions: Copies of corporate approvals for the equity grant
8. Appendix B - Regulatory Approvals: Copies of any required regulatory or governmental approvals
Authors
Technology
Professional Services
Financial Services
Healthcare
E-commerce
Manufacturing
Consulting
Real Estate Development
Education Technology
Telecommunications
Renewable Energy
Digital Media
Biotechnology
Software Development
Legal
Human Resources
Finance
Executive Leadership
Corporate Governance
Compliance
Administrative
Company Secretariat
Board of Directors
Chief Executive Officer
Chief Financial Officer
Chief Technology Officer
Senior Software Engineer
Business Development Director
Legal Counsel
Human Resources Director
Company Secretary
Chief Operating Officer
Product Manager
Senior Consultant
Department Head
Technical Lead
Research Director
Regional Manager
Vice President
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