ESS DocumentationThis ESS (Employment Share Scheme) Documentation is suitable for employees of small businesses in Australia.
Employee Share Schemes (ESS) give startups a way to issue shares (or options to purchase shares) to their employees. This provides employers with a means for attracting and retaining staff in line with shareholder interests, as the better the company performs the more financial benefit the employee will receive.
The Employee Option Plan within this document establishes the company's ESS for Options. The Offer Letter is used to offer these options to eligible employees as well as outline the specific terms of the offer to each employee. The Board Resolution is required to document the approval of an employee's participation in the company's Employee Option Plan.
Why do you need this ESS Offer and Plan?
An ESS offer and plan is necessary to establish your employee option plan and to set out specific terms of an offer of options to an employee. Apart from being legally compliant, it is important to clearly state any specific terms when offering options to prevent potential disputes.
What is included in this ESS Offer and Plan?
- Company details
- Employee details
- Offer letter and acceptance of offer letter
- Administration of option plan and delegation
- Treatment of options for leavers
- Issue of ordinary shares in respect of exercising options
- Procedure on exit event
- Reorganisation event
- No effect
- Exercise price of options and market value of shares
- Number of options
- Default vesting conditions or customised vesting conditions
- Restrictions on disposal of options
- Board resolution to approve participation
- Option exercise notice